1958-09-06

PUBLIC ACCOUNTS


Mr. Alan Macnaughlon (Mount Royal):: Pursuant to the obligations placed upon the chairman by the rules of the house, Mr. Speaker, I have the honour to present in English and in French the third report of the standing committee on public accounts.
I do not intend to move concurrence in this report.



CONCLUSION OF PRESENT SESSION-SITUATION IN FAR EAST

Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, as one can now look to the hope of termination of this session, I thought I ought to make a few general remarks as to the probable date of commencement of the next session.
I know we cannot always predict the end of a session. Many circumstances arise that make it rather difficult to determine. But as it appears to be generally agreed that today we can expect to conclude this session, I should like to say this. I have been here for 18 years, and I have never seen any session in which there has been harder and more arduous application to an extremely heavy program than has been the case this session. I express the hope that unless international or national problems of major urgency require the calling together of parliament at an earlier date, the next session will not be convened before the month of January. As a matter of fact, some indication is given as to the degree of application to their duties by hon. members when it is realized that since October 14 last, parliament has been sitting for 171 days, and that for a considerable portion of that period extra hours have been the rule rather than the exception.
I believe in parliament. I believe that when parliament is sitting-and when I say this I speak for myself and, I am sure, for my colleagues-there is a feeling of strength to the government of the day, when that government has the benefit of the presence of parliament where, after all, we are all working
to the same end. In a community of council and in common dedication, parliament has its greatest strength.
I mentioned that the international situation might make necessary the calling of the next session of parliament at an earlier date. In that connection I think the house will permit me to make a reference to the present international situation which, while disquieting today, has in recent months revealed grounds for encouragement. We have had during the summer striking evidence of the extent to which international agreement is possible by negotiation under the United Nations. The prospects for progress on disarmament are, I think, better than they have ever been before. In the past month we have seen what the United Nations has been able to achieve in the Middle East toward the reduction in tension, and the general move toward the settlement of that problem. What has been achieved in that area is as yet tentative rather than final.
However, at this time there is in the Far East a situation which is most disquieting. The most alarming aspect there is that it seems difficult to envisage a satisfactory settlement of a dispute which has attained such threatening proportions. I think the world wants to be assured that nothing will be left undone to prevent any action that might result in the world sliding into disastrous consequences. Surely it is not beyond our capacity in the light of the experience in recent months in other parts of the world to find some means whereby in this dispute in the Far East the good offices of the United Nations might be invoked.
As far as Canada is concerned, I think Canadians as a whole would expect that their representatives will not fail at this time to explore every avenue for the settlement of the grave situation which today prevails, and it is in that spirit that I suggest the United Nations might have an opportunity and an appointment with responsibility in this direction.
Hon. L. B. Pearson (Leader of the
Opposition): Mr. Speaker, I agree with the Prime Minister that this session appears to be approaching its terminal stages. I also agree with him that it has been a hard working but an interesting one. I can certainly understand him when he says that
4704	HOUSE OF
External Affairs-Far East this has been the most interesting session he has had in his 18 years of parliamentary experience.
It is unfortunate that we are closing the session at a time when international tension in the Far East has increased, especially in view of the fact, as the Prime Minister has indicated, that during the earlier part of the summer tension in other parts of the world seemed to have decreased. It is not wise to be too optimistic when tension decreases, and it is certainly not wise to be too pessimistic at a time when tension appears to increase; but the situation which the Prime Minister has mentioned in the Far East in respect of Quemoy, Matsu and the offshore islands certainly does give cause for great anxiety.
The Prime Minister has mentioned the possibility of the good offices of the United Nations being invoked in this tense situation, a situation which he said had reached distressing proportions; indeed they are dangerous proportions. Anything that can be done, of course, in that direction should be done. We are all aware, I think, of the great success to which the Prime Minister also referred of the United Nations in its intervention in the Middle East. I confess that the action of the assembly on that occasion resulted in more constructive progress than I thought might be the case when the assembly was called together. I know we all rejoiced at its success on that occasion.
If intervention by the United Nations in the Far East in this particular situation should meet with success we would certainly also rejoice. But it is perhaps going to be a little more difficult in this case because intervention there would be intervention by the United Nations in respect of a dispute between two governments, each of which claims to be the government of China, and in that sense this is a dispute which is a civil conflict. The United Nations has recognized one side in that conflict as the government of China and not the other. That is a complicating feature of the situation.
I have had some personal experience in this connection, because I did once take part in negotiations within the United Nations as a member of the committee searching for a formula for a Korean armistice. Those negotiations took place with representatives of the Chinese communist government, and we did not recognize that government. On the other hand, when they met with us, they did not recognize us, and we had to deal with them in adjoining rooms. Another indication of the difficulty is that when a settlement was sought in Indochina it had to be done outside the United Nations, because red China was involved there.


Nevertheless, without underestimating the difficulties, I agree that if anything can be done with regard to this matter in the United Nations it should be done; perhaps it is something which the Canadian delegation to the forthcoming assembly could pursue.
The situation is dangerous because among other things such a high proportion of the army of nationalist China has now been concentrated on these two small islands. I am told that more than one-third of Chiang Kai-shek's best troops are there. That is creating a situation Where the defence of these islands is becoming more and more important to the defence of Formosa, and it is to the defence of Formosa that the United States has committed itself, not the defence of these islands. But the two things are becoming more closely intertwined.
The Secretary of State for External Affairs has said on behalf of the government, and, I agree with him wholeheartedly, that we are not committed in this matter. We are not committed, but we are certainly concerned, and if anything happens out there to involve the United States we will be more than concerned; we could hardly help being involved if only because of the fact that we, quite rightly, have a North American air command for defence purposes. As the Prime Minister has said, it is a dangerous and tense' situation.	,j
The right hon. gentleman also mentioned the prorogation of parliament. I should like to ask him whether in view of possible international and, indeed, domestic developments he has considered adjourning rather than proroguing at this time. This would make it easier for us to meet in the event of an emergency.


John George Diefenbaker: The question of whether we should adjourn or prorogue is one that I think should be viewed from the standpoint of practical realities and the interpretation which would be given to any action of that kind. Were we to adjourn, the interpretation placed upon it might be other than the interpretation placed upon prorogation. If events should make it necessary the calling of parliament would not be long delayed; I think it would be possible to call parliament together just as quickly as it would be after a mere adjournment.


Mr. H. W. Herridge (Kootenay West):: I am
sure everyone has listened with great interest to the Prime Minister's statement with respect to this session which is about to conclude and with respect to the possibilities for next session, but I am sure the portion of his statement to which we paid even closer attention was his reference to the international situation, because without doubt there

is great public concern regarding this developing situation with respect to Formosa and the adjacent islands.
We were very interested to hear the Prime Minister say that our representatives at the United Nations will not fail to explore every avenue in dealing with this situation, and his reference to the possibility of invoking the good offices of the United Nations. I think that is very interesting, particularly in view of the forthcoming meeting of the general assembly. The Prime Minister and the Leader of the Opposition referred to the successful action of the United Nations in dealing with the difficult and tense Middle East situation, and on that account I just want to ask one question before closing.
Is the government of Canada prepared to give leadership to the world in an effort to prevent further unfortunate developments in this crisis by proposing that the whole question be referred to the general assembly of the United Nations for action soon and, in so doing, earn the gratitude of all mankind?


John George Diefenbaker: Mr. Speaker, the question that has been asked by the hon. gentleman is a very large one. I went a considerable way in my opening remarks, and having regard to the distance I went I am sure the hon. gentleman would not expect me to answer to a greater extent and give more information than was given in the earlier stage. I thank him for his suggestion, and also for having underscored the necessity of steps being taken to bring about a solution of the situation the seriousness of which the Leader of the Opposition and the hon. gentleman have not exaggerated in their descriptions.



BUSINESS OF THE HOUSE


[Stage Direction]
On the orders of the day:
Hon. E. D. Fulton (Minister of Justice):: Mr. Speaker, I should like to make a statement in regard to the government's intentions in connection with Bill No. C-32, item No. 3 on the order paper. On December 21 last, during the session of parliament that was then in progress, I introduced Bill No. 241, an act to amend the Criminal Code dealing with the slaughtering of animals. At that time I referred to the growing demand for action that would compel all slaughterers of food animals to adopt humane methods of killing, and indicated that it was the view of the government that some action in this field was desirable.
At the time the bill was introduced I pointed out that there were a number of considerations that had to be borne in mind and
Business of the House
a number of difficulties to be overcome before we could be sure we had satisfactory legislation. For this reason we said we would only give the bill first reading at that time, and then leave it to stand over to this session so that all those interested could consider the draft legislation and make their representations or suggestions in connection therewith.
I was particularly concerned, of course, to have the comments of the provincial attorneys general, since the provinces are responsible for the enforcement of the Criminal Code. We received comments from six of the provinces, all of which contained some criticism or suggestion which we did our best to meet in redrafting the measure. We also received comments from one or two of the humane societies and the council of meat packers, but apart from these we received very few suggestions from individuals or organizations.
I accordingly introduced this session a new bill, No. C-32, which was given first reading on June 25. This bill includes modifications which were suggested by the limited number of comments we had received.
Notwithstanding our conscientious attempts to provide legislation that would meet the situation we nevertheless, since June 25, have received strong representations from a large number of sources to the effect that it is not satisfactory. I must inform the house that most of these representations received after the introduction of Bill No. C-32 this session are from persons or organizations we had not previously heard from, or alternatively they raised points not raised in the earlier submissions, and that it would have been most helpful if we could have received them subsequent to the introduction of the bill at the previous session and prior to the introduction of the new bill at this session. It was for that purpose that we had allowed it to stand over after first reading last year. However, the fact is that we did not receive them until after we had introduced Bill No. C-32, and the result is that we are now faced with a number of conflicting representations and points of view, many of them involving new considerations of real substance which frankly it has not been possible to reconcile or resolve in the time at our disposal since they were received.
The submissions which raise new considerations deal with such points as the problem of providing for those cases where slaughter, or preparation for slaughter, is carried out in conformity with certain religious ritual; the designation of approved appliances; the availability in Canada of equipment necessary particularly in the case of certain classes of animals; the desirability of defining

Business of the House
"humane method" in advance so those installing certain devices will know for certain that the expenditures made will not be thrown away; the problem of legislating in such a way that large commercial slaughterhouses will be covered without at the same time imposing conditions which it is impracticable or impossible for small concerns or individual farmers to comply with, all matters which present real problems when criminal legislation is concerned.
Strong representations on one or all of these matters have been received from religious organizations, from humane slaughter societies, from small packers, from large packers and from individual farmers and farm organizations, representations of a nature and from sources which are entitled to careful consideration. Unfortunately, as I say, they were received after Bill No. C-32 was introduced.
In the face of these comments and objections I have come reluctantly to the conclusion that it is not possible at this time to find a legislative formula that would resolve all the difficulties that are involved. I wish to assure the house that we in the Department of Justice have tried conscientiously to find such a formula, and express my regret that we have been unable to do so. Accordingly I have come to the conclusion that it would not be in the public interest to proceed with Bill No. C-32 at this session.
We are still convinced, however, that it is desirable that some action be taken. It is our present feeling that the best way to proceed would be to place the matter before a committee of parliament in order that evidence and opinions of all those concerned may be heard and studied, in the expectation that in this way and with the assistance of members of parliament themselves we may work out a satisfactory method of meeting the problem. Accordingly it is our intention to introduce a further draft proposal at the next session which will be placed before the appropriate committee of the house, or possibly of both houses, for their study and consideration.
It is my hope that in the meantime all concerned will give the matter further consideration and prepare their submissions, so that at an early date next session the committee may proceed with its study and hear evidence which should be helpful in enabling parliament to determine the best course to follow in bringing about a solution.
I cannot conclude, Mr. Speaker, without expressing my appreciation for the co-operation I have received from interested organizations. I should also add that it is a matter of great satisfaction to me that a number of

the large meat processing plants have already installed humane devices for the slaughter of food animals.


Hon. L. B. Pearson (Leader of the Opposition):: Mr. Speaker, the minister's
statement deals with a matter which we had anticipated would have been brought before the house this session. Indeed, the minister himself indicated that; but in the circumstances I do not think anyone can object to the stand he has taken and the course he proposes. We on this side have noted with satisfaction his reaffirmation of the desirability of action in this matter, a matter which has aroused great public interest in the country. I think the course he has suggested, namely that the subject should be referred to a committee at the next session of the house, is a good one.


Mr. Hazen Argue (Assiniboia):: Mr. Speaker, we are disappointed that circumstances have made it difficult if not impossible for the minister to proceed with the bill at this time. We know that Canadians generally abhor cruelty and inhumane actions in the slaughter of animals. I am sure the people of Canada are sympathetic to the principle of the bill and desirous that action should be taken.
I appreciate the difficulties the minister has outlined and some of the considerations that must, of course, enter into any such measure, particularly with reference to conformity to religious ritual. We do not think there should be any undue consideration of the monetary cost of installing whatever equipment is necessary for the humane slaughter of animals. We would certainly resist any pressure that might be applied on this ground.	We are pleased that the
minister has not dropped the bill permanently but will reintroduce the subject at the next session of parliament by referring it to a committee of the house, in the hope that some satisfactory solution may be obtained. (Translation):



REQUESTS TOR ANSWERS TO QUESTIONS ON ORDER PAPER

[Stage Direction]
On the orders of the day:
['One of the officials of my department.']
Mr. Guy Rouleau (Dollard):: Mr. Speaker, I wish to put a question to the Secretary of State (Mr. Courtemanche).
Since the session might well end in two or three weeks-or even possibly today-may I point out that on the 24th of June I had a question placed on the order paper. It was No. 125. Later on, I had another one, No. 163, inserted on the 18th of July. May I ask the Secretary of State if I could obtain an answer today, or if this is not practicable, would he be good enough to approach the minister concerned so that I could have a reply by return mail?


Hon. Henri Courlemanche (Secretary of State):: Mr. Speaker, I take due note of the question put by the hon. member for Dollard.
(Text):



[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: Mr. Speaker, I should like to ask the Minister of Trade and Commerce this question. What steps is the government taking, in the light of the highly competitive uranium market, to expedite the signing of bilateral agreements which are an essential prerequisite before we can develop markets for Canadian uranium?


Hon. Gordon Churchill (Minister of Trade and Commerce):: Mr. Speaker, we are fully aware of the competition respecting uranium throughout the world, and we want to maintain ourselves in a satisfactory position because of the supplies of uranium we have in Canada. We have every intention of pursuing very actively the negotiation and signing of bilateral agreements where that is possible.


Lester Bowles Pearson: May I ask a supplementary question. Will the minister comment on reports that negotiations are now going on between Japan and South Africa for the purchase of a sizeable amount of uranium oxide, and on reports that the U.S.S.R. has now offered to sell uranium on the open market?


Gordon Minto Churchill: I have no comment which would be helpful at this moment. We are quite aware of the fact that South Africa has substantial supplies of uranium, and the Leader of the Opposition has simply drawn attention to the competitive nature of the marketing of uranium throughout the world. We are fully aware of that, and intend to maintain our position if at all possible.


IMMIGRATION
[Stage Direction]
On the orders of the day:
Mr. Harold E. Winch (Vancouver East):: Mr. Speaker, I should like to direct a question to the Minister of Justice. In view of the fact that this session of the house is now coming to a close and also in view of the importance of the Doukhobor question in British Columbia, is the Minister of Justice able to make a progress report on the situation? Can he tell the house what is now taking place and
Inquiries of the Ministry whether or not he has yet received any official communication from the Soviet embassy relative to the acceptance by that country of the Doukhobors, almost 3,000 of whom, I understand, have now agreed to leave Canada under the financial agreement announced some time ago by the Minister of Justice?


Edmund Davie Fulton: Mr. Speaker, I shall deal with the last part of the question first. I can say that we have received no direct communication from the Russian embassy or from any individual Doukhobor or representative group of Doukhobors, including the sons of freedom sect, on the subject of negotiations with the Russian government. I believe it is a matter of public knowledge-if it is not I can confirm it now- that a small group of the Doukhobor leaders did visit Ottawa recently and apparently paid a visit to the Soviet embassy. They did not contact or attempt to contact myself or any representative of the federal government.
I have received no report directly on the results of that visit but I have had a report from the attorney general of British Columbia within the last few days that a delegation waited on him after the visit to the Soviet embassy and reported to him that they had been given a very friendly reception there, although he did not receive any report as to any conclusive results of that visit. The attorney general tells me that he is informed- I think this has been stated in the press- that the Doukhobors feel very definitely that a considerable number will be returning to Russia and that there will be agreement with the Soviet authorities to receive them, but we have no direct information on that point.


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
Mr. G. J. Mcllrailh (Oiiawa West):: Mr. Speaker, yesterday the Leader of the Opposition directed a question to the Prime Minister concerning the export of used fighter aircraft to United States purchasers and in his answer the Prime Minister said, among other things, that he would give a detailed answer today. In view of that fact and in view of further press comment on the subject this morning, I wonder whether the Prime Minister or some minister of the government is able to give us the precise details on this subject.


Hon. G. R. Pearkes (Minister of National Defence):: These aircraft, Mr. Speaker, were declared surplus two years ago, and they have been advertised for sale. At last a purchaser has been found. These aircraft have been

Inquiries of the Ministry moved from Alberta to the United States. There is no secrecy as to the destination, and they will be sold, I am informed, only to citizens of the United States. The Department of National Defence has no further requirement for this type of aircraft.


George James McIlraith: I wonder if I might be permitted a supplementary question, Mr. Speaker. My concern is not with the fact that the department declared them surplus; my concern has to do with the dangers inherent in an improper ultimate use of the aircraft. Would the minister go a little further than he has gone, and tell us whether or not export permits were granted, and whether when they were granted there was consideration by cabinet, or a committee of it, of the implications of this sale before permits were granted; whether or not an order in council was passed, and if so would he table it, and what steps have been taken by the government to ensure that there is no re-export from the United States, bearing in mind the fear I expressed earlier.


George Randolph Pearkes: The sale was made through the Crown Assets Disposal Corporation. I understand that no export permits are required for that type of equipment going to the United States.


Mr. Pickersgill:: What about the order in council? The minister did not say anything about that.


George Randolph Pearkes: No order in council is necessary for such a sale.


Lester Bowles Pearson: Was any action taken to ensure that these planes would not be exported to an undesirable destination?


George Randolph Pearkes: I am informed that these aircraft will not be sold to anyone but a citizen of the United States.


Lester Bowles Pearson: May I ask who informed the minister of this?


George Randolph Pearkes: One of the officials of my department.



INQUIRY FOR RETURN


[Stage Direction]
On the orders of the day:
Mr. Frank Howard (Skeena):: I have a question I should like to direct to the Secretary of State. On September 3 a question of mine was passed as an order for return, and I wonder if the Secretary of State could indicate whether or not it will be possible to answer that question before this session ends?


Henri Courtemanche: I shall be able to table this answer today.



DOMINION-PROVINCIAL RELATIONS NEWFOUNDLAND    REPLY TO REQUEST FOR INCREASED GRANT

[Stage Direction]
On the orders of the day:
John Whitney Pickersgill: I should like to ask the Prime Minister if a reply has yet been sent to the telegram from the premier of Newfoundland transmitting the text of the resolution adopted unanimously by the house of assembly two days ago, and which was moved by the premier and seconded by the leader of the opposition.


John George Diefenbaker: The answer, Mr. Speaker, is that a reply has not yet been sent. I had hoped that it would be, but it has not because of the rush of events in the last two days. As the decision had been made that there would be no further legislation introduced at this session and no additional estimates following the estimates that are now before the house, the answer will be obvious.


John Whitney Pickersgill: I take it, then, what the Prime Minister is saying is that the government does not intend to comply with the request?


Mr. Speaker:: I think this is a matter that necessarily comes up in consideration of the estimates.


John Whitney Pickersgill: You are quite right, sir, and I thank you.

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



DEPARTMENT OF FINANCE

[Stage Direction]
550. Departmental administration-further amount required, $20,775.
John Whitney Pickersgill: I want to draw the minister's attention to the text of the communique issued at the conclusion of the federal-provincial conference on November 26, and particularly to the last two paragraphs in that communique, which read as follows:
Possible changes in the tax-sharing arrangements act were discussed but it was understood that no endeavour would be made to reach conclusions on this matter prior to further consideration of the subject by the dominion government in the light of the public statements made by the provincial representatives in open sessions and the discussions which took place in committee.
All delegations wish to express their pleasure at the opportunity which the conference afforded to put their views before the others who were present. It was agreed that a subsequent meeting be held as soon as possible in the new year in accordance with the proposal made by the dominion government in calling this conference.

Well, as I look at the calendar on the table I find that this is September 6. This conference has neither met nor have we been able, despite repeated requests throughout the session, to get any indication as to when the conference might be called or indeed if the conference will be called at all. All hon. members are aware of the fact that one Saturday morning in January last the minister came into the house and read the text of a telegram he had sent to the premiers of the ten provinces indicating that the federal government in its wisdom, as a unilateral act, was going to make a change in the taxsharing arrangement to increase the base on which the share of the income tax of the provinces was calculated from 10 per cent to 13 per cent. We all remember that the minister had some difficulty with his arithmetic, and he spent most of the next week correcting it, but that is a minor matter.
The major matter is that the preceding parliament had passed an act, valid for one year only, an act which applies to the fiscal year in which we are now, and an act which will expire not long after the opening of the next session if it comes, as the Prime Minister in his prognostication suggested it would, some time in January.
I said this in the budget debate, and I would remind the minister that no reply was given at that time. I said I felt that it was a deliberate design of the government to have it happen this way, so that next January the provinces would be faced with another take it or leave it, unilateral proposition. That appears to be what is in contemplation.
There is, of course, an alternative which would be even less acceptable, I should think, to the provincial governments, namely that the government should just allow the legislation to lapse and go back to the previous arrangement. It may be that, in view of the staggering proportions of the minister's deficit, that is his secret intention. However, I am not seeking to speak the minister's mind; I am only seeking to speak my own.
It seems to me that this is a strange way to proceed, that it is a strange way to treat the provinces after this undertaking that the conference would be convened as early as possible, or as soon as possible in the new year. I know if that communique had been issued by the present Prime Minister's predecessor or by the predecessor of the Minister of Finance that conference would have been held long ago. The plain meaning of those words was that it would be early in the new year and I could look up statements in the proceedings which
Supply-Finance
would confirm that impression. But for some reason or another, despite what all the provincial governments undoubtedly believed was an undertaking that this conference would be held, there has been no conference and no hint of a conference from the federal government.
We have had, of course, several statements attributed to the premier of Ontario that the conference would be held at this date or at that date, but it seems evident that the premier of Ontario is perhaps not as much in the confidence of the present administration as he may have been when this conference was held a year ago, or as he may have been even as late as January, or as his officials may have been at that time. But what we know, and all we know-because we have been kept completely in the dark about this matter and there are very few places where it is possible under the rules to debate it, and this happens to be one of them-about this extremely important matter is what we have read. The minister from Newfoundland had this to say on May 4, 1947, as reported in the St. John's News. I just happened to have his comment here; I could just as well have quoted any other minister.


Mr. Browne (St. John's West):: Did the hon. member say 1947?


John Whitney Pickersgill: I should have said 1957; I thank the hon. gentleman for the correction. This statement is in direct quotation marks. It was a statement made by the hon. gentleman at St. Stephen, New Brunswick. No, I am mistaken; it was a statement made by the Prime Minister at St. Stephen, New Brunswick. The hon. member for St. John's West was asked for a comment, and this is what he said:
-our party if returned to power will give the Atlantic provinces and the municipalities a better deal than they have now.
So far as the Atlantic provinces are concerned the minister's party has carried out that undertaking, and I have always given them credit for that fact. But what I am drawing attention to is the statement of the Prime Minister and what the minister said. The minister went on to say this, and I may say that I just picked this report up; I happened to have it here, but I could find this same statement from half a dozen other ministers, including the Minister of Finance. The minister went on to say:
"The federal government during the past eight years has been in a position where the revenue collected by them leaves no room for the provinces or the municipalities to finance the improvements and maintenance of necessary public services.
"They will continue to suffer from shortage of schools, electrification and good roads-

Supply-Finance
And these are the words I wish to emphasize.
-unless there Is a redistribution of the taxation powers. This our party hopes to bring about.
That was the policy. It was the policy enunciated by Mr. Drew when he was the hon. gentleman's leader, when he sat over here on this side of the house in another parliament. It was the policy enunciated by the present Prime Minister. It was the policy repeated ad nauseam by the Minister of Finance when he sat over here on this side of the house. I refer to the policy that there was to be a redistribution of these tax sources. Where is it? When is it going to happen, or what is going to happen?
I do not think anybody believes that this particular feature of Tory policy is ever going to be translated into action. When the minister made that confession last January that he had to follow Mr. Harris's policy and that all that he could do was pay a small dividend on Mr. Harris's policy, I believe that was the real and practical turning point.
I must say that I commend the government for their wisdom and good sense in adopting Mr. Harris's policy, because it was a sound policy and theirs was never a sound policy, but the fact is that they only did it in this unilateral fashion. They only did it for one year. No provincial government now knows, nor does this parliament, what is going to happen at the end of the year. Before very long I think the minister should come clean and tell us what the policy of the federal government is with respect to this tax-sharing problem, and particularly with respect to the statute which is going to expire this year.


Mr. Fleming (Eglinton):: The house has been given from time to time all the information that is available on this subject. The important measures that were passed by parliament last January for fiscal assistance to the provinces have been an important contribution to strengthening the fiscal position of the provinces and the municipalities during this year. The Atlantic adjustment grants providing $100 million payable at the rate of $25 million per annum over the next four years commenced on April 1. Each of the four Atlantic provinces is receiving benefits from that source, New Brunswick, Nova Scotia and Newfoundland at the rate of $7J million per annum and Prince Edward Island at the rate of $2J million per annum.
The other measure of fiscal aid to the province approved by parliament in January on the motion of the government was the increase from 10 per cent to 13 per cent in the provincial share of the yield from the
[Mr. Pickersglll.l
personal income tax. That has been of assistance to all of the provinces. That is the position. The provision for the increase to the provinces from 10 per cent to 13 per cent in the yield from the personal income tax was provided by parliament for one year.
The reasons for inability to reconvene the dominion-provincial conference at the beginning of the year were stated at that time and were discussed fully in this house. I am sure there is no advantage in repeating now what was said then. The government is well aware that the provision by way of increase from 10 per cent to 13 per cent applies only to the present year. Whatever measures are proposed by the government in relation to calling a conference on this subject of fiscal relations between the dominion and the provinces will be announced in due course. I have nothing I can usefully add on that subject today.
The hon. member has spoken of the budget. I think I should recall in that respect that the budget deficit estimated when I spoke in the budget debate on June 17 was $648 million. In the discussion of amendments to the Excise Tax Act, when we increased exemptions from the sales tax on fuel oil when used in logging, lumbering and mining operations involving further decreases in taxation of an estimated $2 million, I stated at that time that they would increase the deficit by that amount to $650 million. The sums included in the further supplementary estimates which have been tabled, which have been discussed in part and which will be further discussed today, involve further increases in expenditures. My estimate at this time of the deficit in the light of these increased commitments, is of the order of $700 million.


John Whitney Pickersgill: I have one or two questions. Of course the minister did not answer the most important question I asked, and I repeat it. Is it the intention of the government to allow this legislation to lapse without putting anything in its place, or is it the intention to continue the 13 per cent? That is not an academic question. We are in the month of September and every provincial government, like the federal government, has to have some basis upon which to plan its finances. I should think after the 15 months or so during which the minister has been in office he would realize that for a provincial government that is an increasingly difficult problem; and to leave the provinces in doubt as to whether this additional 3 per cent is going to be continued or whether something is going to be put in its place does not seem to me the fair way of dealing with the provinces, by agreement, about which we used to hear so much when we were on the other side of the house and the hon. gentleman was over here.

This 3 per cent was given not after consultation with the provinces, but it was simply a decision of the federal government, a decision they made and which they could unmake. I should not say unmake because they made it for only one year, but if it is not made again the provinces go back to the 10 per cent. I think surely that, at least, should be cleared up, and surely the minister could tell us whether it is the intention, before new legislation is introduced, to have a conference.


Donald Methuen Fleming: I have dealt with
that question. I said that when it is appropriate for the announcement to be made it will be made. I have indicated that these considerations as to the position of the provinces are in the mind of the government. We showed that in January, when in the face of urgent requests from the provinces we moved to ask parliament to increase the fiscal payments to the provinces without waiting for the time when it would be possible to reconvene the conference. We have not overlooked and do not intend to overlook the need which the provinces will have to know what they are going to receive in the next fiscal year so the provincial treasurers may plan their budgets accordingly.


John Whitney Pickersgill: What the minister is
saying is that in his own good time and out of his own superior wisdom he will condescendingly let the provincial treasuries know whether he is going to give them anything and, if so, what it is going to be; and that in the meantime this House of Commons, from which he is craving supply at this moment, has no right to know anything about it.


Donald Methuen Fleming: That is not what
the minister said at all. That is not the spirit in which the minister spoke at all. The minister I think indicated an understanding attitude toward the problem.


John Whitney Pickersgill: I will leave it at that.


Lester Bowles Pearson: This further item of departmental administration makes it possible for me to return to a matter which I raised the other day in connection with the conversion loan. I shall do so very briefly in order to make sure that the record is straight and that there is no misunderstanding concerning the matter.
The other day I asked the minister a question. I did not make a statement, I asked him a question as to what were the additional interest charges the taxpayers will have to pay, and I went on to mention charges which had been estimated to be as high as $100 million per year for the next 25 years. Then in order to make it quite
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clear that this was an estimate made by someone else I said that, of course, the amount would depend on how successful the operation will be. We learned last Tuesday, that $5 billion had been reconverted and most of it, I suppose, would be into the 25-year bonds.
During the luncheon recess on the day of that debate the minister got his own figures from the Bank of Canada. He brought them into committee in the afternoon. On the basis of those figures he challenged my mathematics. I must say I thought he was brave in bringing up our comparable ability at mathematics. Mine is certainly not great, as he indicated, but his own record speaks for itself. He and his supporters got a good deal of pleasure from the discrepancy between the figure I reported as having been estimated by a certain source at $100 million and his Bank of Canada figure of $49 million. I do not begrudge the minister his moment if not of truth, at least of amusement over this comparison, but I have had an opportunity to look into the matter a little further and I think it should now be cleared up.
If the figure of $6.4 billion is taken-that is the objective of the loan and it is undoubtedly on that basis that the estimate I gave to the minister was made-and if the calculation is made on the basis of the success of the loan and the conversion into 25-year bonds where the interest rate is 1J per cent greater, the amount-and I am sure the minister's mathematics will agree with mine here-of extra interest charged to the taxpayer will be $96 million. So this particular estimate made on that basis of calculation was $4 million out; it should be $96 million instead of $100 million.
The minister gave his figure of $49 million, but he did not explain it or justify it. I suppose he explained it to this extent; he said that the amount was based on the $5 billion converted to date, which is a very different basis of calculation from the one taken in the calculation I gave. He gave the impression that our calculations were made on the same basis, which was not valid.
Assuming that all the bonds in the amount mentioned by the minister, that is to say $5 billion, have been converted-all of them- into 25-year bonds, the additional interest charge which would have to be paid on the basis of calculation he used would be $75 million. That is, assuming there was a 100 per cent conversion from the victory bonds to the 25-year bonds in the amount of $5 billion, the additional annual interest charge would be $75 million and not $49 million. Therefore if the minister's figure, given to him as he states by the Bank of Canada, of $49 million is accurate, then the government

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has failed to reach its major objective, which was to convert the old bonds into the new 25-year bonds, by that amount.
The difference, therefore, was not due to any error in arithmetic on my part but to the calculation which the minister made on a basis which brings about a figure of $49 million only. But this does have serious implications because I suggest it means that not as high a proportion of these bonds in the $5 billion total is being converted to the 25-year bonds as is desirable.
Before I sit down I would like to ask the minister another question on this point. Is he in a position to say whether the new conversion bonds will be supported at par, or will their value be allowed to fluctuate and find its own level on the market? That, as the committee knows, is an important question which is of great interest to bondholders and also to this committee, because the answer the minister gives will throw some light upon the monetary policies which will be applied in our country in the future, and in the very near future, when some monetary questions will have to be decided.


Donald Methuen Fleming: 
Lester Bowles Pearson: I thank the minister for the information he has given but I certainly intend to correct the statement, which he repeated, that my figure was a miscalculation. It was no miscalculation at all. Why do I have to read again what I said? I said: "I want to ask the minister what are the additional interest charges the taxpayers will have to pay, which have been estimated to be as high as $100 million." That estimate has appeared in the press and that is where I read it; in a reputable journal too, and it was not the Winnipeg Free Press.
Then I went on to say, being particularly cautious, that the final figure would depend, of course, on the amount of bonds converted and into what maturity they were converted. Then the minister came back with his figure of $49 million without any explanation at all. He has given us his explanation this morning, and it is an important explanation.

Indeed, it does explain where he gets his figure of $49 million. The figure of $100 million was obviously based on the assumption that the operation would be completely successful and that the conversion would be entirely into the 25-year bonds.
I am sure it was the desire of the government to get as high a proportion of this conversion into the long term bonds as possible. I am sure that was the desire in order to make it easier for future financing. What we have learned this morning is of importance; that of the $5 billion converted, $1.8 billion has gone into the 25-year bonds and smaller amounts into the earlier maturities. Therefore, the calculation made on that basis does come to this figure of $49 million. To that extent it is true that the burden on the taxpayer will be easier. But to that extent also the operation has not been as successful, I assume, as the government would have liked it to be. However, there is still another week to go, and perhaps there will be more 25-year bonds taken out.


Donald Methuen Fleming: We think this has been highly successful. We did not think for one minute that every holder of victory bonds would convert into the 25-year maturity. For instance, bonds in the case of many institutions are not normally purchased for periods of 25 years; they usually operate in the shorter term market. We think the response, with 36 per cent of the conversions in terms of the amount up to Wednesday of this week going into the 25-year bond, is a highly satisfactory result. There should not be any impression, therefore, that there has been a lack of success or any disappointment over the results. The results in all respects have been most highly successful.
I shall simply make this further observation with regard to interest yield. There has been a great deal of loose talk, and some of it in this house, about an increase in interest rates of 1J per cent. From the figures I have given the committee it will be quite clear that as of the close of the market on Wednesday of this week the net increase in interest on the aggregate of conversions, far from being 1J per cent has been a fraction under one per cent.


Mr. Carter:: Before this item carries I want to refer the minister to a question which I placed on the order paper on July 1, question No. 143. This question was in two parts. Part 1 reads as follows:
How many loans have been granted to persons, companies or firms in Newfoundland by the industrial development bank in each year since 1950?
Part 2 reads:
What is the amount of each loan?
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On August 18 as reported in Hansard on page 3754, the minister gave the following answer:
1.	1950, 1; 1951, 1; 1952, 1; 1953, nil; 1954, 1; 1955, 1; 1956, 1; 1957, 2; 1958, 2.
2.	It is not in the public interest to disclose this information, which is a matter of customer and bank relationship.
Just because the minister makes that statement it does not automatically follow that he is right, because I do not think the minister is any less fallible than the rest of us.
It would certainly be in the public interest to know the amount of loans made by this bank in any fiscal year or in any calendar year. If it is correct that there was only one loan in each of six years in the nine-year period, that might perhaps justify what the minister said, though I would point out to him that we were not asking who got the loans and we had no interest in knowing who the customers were, but rather we wanted to know only the amounts of the loans. I do not think the minister could claim it would not be in the public interest to tell the committee what was the total amount of the loans granted in that nine-year period, and I ask him to give that information to the committee at this time.


Donald Methuen Fleming: Mr. Chairman, my hon. friend may not appreciate that the industrial development bank is not an adjunct of the Department of Finance at all. The industrial development bank is a subsidiary of the Bank of Canada. It operates as an independent institution. I have no control over the industrial development bank. Some hon. members speak and act as though I had. I wish to make it clear that the industrial development bank is a subsidiary of the Bank of Canada and is responsible to the Bank of Canada. The Bank of Canada has a separate, independent status created by a statute of this parliament. The industrial development bank, it is true, reports from time to time as to the extent of its lending operations. Those reports appear publicly from time to time.
As to its operations in Newfoundland or in any other province, I believe that information may be available from the bank sources; but if it is, it is available to my hon. friend just as much as it is to me, because of the fact the bank operates independently of the government and independently of the Department of Finance.
When this question was asked, appearing as question No. 143 of this session, I take it the bank had a very good reason for not giving the amount, because it would have tagged each individual loan. It is not as though there had been a large number of

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loans so that the answer to the second question would not have disclosed the affairs of each particular individual borrower. I think my hon. friend will appreciate that it is not quite fair to expect a bank which operates in this independent way to disclose its individual operations and transactions with its customers. It makes its reports to the Bank of Canada and gives general disclosure of its operations, but not of any individual transaction.


Chesley William Carter: As I understand it the Bank of Canada is an instrument of federal government fiscal policy-


Donald Methuen Fleming: No, no. I wish to correct my hon. friend on that, Mr. Chairman. The Bank of Canada has an independent status under legislation enacted by this parliament, and it has powers that are conferred upon it directly by parliament.


Chesley William Carter: Is the government going to make the amendment promised by the Minister of Justice during the last campaign?


Donald Methuen Fleming: To what amendment does my hon. friend refer?


Chesley William Carter: An amendment to the Bank of Canada Act. I believe the industrial development bank could play a much more useful role than it is playing at the present time. At present all it can do is lend money to individuals for capital industrial investment. That is not the great need at this time, particularly in Newfoundland. Whether or not the industrial development bank is a subsidiary of the Bank of Canada, it has been set up to give the public a service which they cannot get from the regular chartered banks. If it is not doing that there is no justification for its existence.
At the present time I fail to see that it is doing very much more than the ordinary commercial banks are doing and in so far as Newfoundland is concerned, as the record of that question shows, it has been of very little use at all. What we want to achieve is better use of this bank, and we want to enable it to function in a way that will be of greater benefit particularly to the smaller business people in Canada.


Donald Methuen Fleming: Mr. Chairman, my hon. friend can complain as he wishes if he thinks the industrial development bank is making loans in fields in which it should be operating, but I would ask him before he makes such criticisms to consult the statute under which this bank operates, because this bank's powers of lending are defined and prescribed strictly by parliament. I am informed that the bank receives many applications that are completely outside the
[Mr. Fleming (Eglinton).1
scope of operations in which the bank is permitted by parliament to engage.
The annual report of the industrial development bank for the fiscal year 1957 is available. It shows the classification of provinces in terms of aggregate statistics. It shows that to September 30, 1957-that is to say the close of the bank's fiscal year at September 30 a year ago-the gross authorization on loans, investments and guarantees for Newfoundland was $475,000 less calculations and reductions. The gross authorizations during the fiscal year 1957 amounted to $255,000. The current authorizations at September 30, 1957, were $433,000, and the amount of loans outstanding in Newfoundland at September 30, 1957, was $315,000.


Chesley William Carter: I thank the minister, but I know that information is in the report. What the minister said confirms my complaint to the effect that the bank is restricted in its operations by an act of parliament. I believe that act should be opened and broadened so the scope of the bank's operations could be extended, particularly to meet the needs of the small businessmen in Canada.


Mr. Dumas:: Mr. Chairman, I shall take only a few minutes of the time of the committee because I know the minister is very anxious to complete his estimates, and I do not blame him for that.
By the end of this month the commonwealth trade and economic conference will have taken place in Montreal; in fact the minister told us it would take place between September 15 and 26. A few days later, on October 6, another very important conference will be held in New Delhi and the Minister of Finance will attend as a representative of Canada in his capacity as Minister of Finance. I know he will have great responsibilities at both conferences. One of the most important items on the agenda at the New Delhi conference will be that of expanding the operations and functions of the international monetary fund and the world bank.
Early in the year we knew something was to be done, but of course we did not know how it was to be accomplished. There were rumours in the spring that perhaps there would be an increase in the price of gold. An interesting article on this subject appeared in the Montreal Gazette of Wednesday, June 4, 1958, one paragraph of which I wish to cite:
The possibility that the United States might so act-
-to increase the price of gold. I continue:
-was widely rumoured last week. Plenty of evidence could be marshalled to support such a

move. The most persuasive is the threat of a squeeze on. international short term credit if the American recession deepens.
Of course this threat has materialized. 1 continue:
"The simple reason for the thoroughly undesirable squeeze on liquidity is that since pre-war days, the dollar price of many commodities entering into international trade has trebled while the dollar price of gold has stood still "says The Economist, London.
That is an extract from an article which appeared in The Economist of London. Now, Mr. Chairman, we were informed in a statement by the Prime Minister in the house on July 25 that he favoured increasing the quotas of the international monetary fund and the international bank. In a very clear statement the Prime Minister outlined what he thought should be done. Of course this was not new because earlier in the month, on the occasion of the visit of the Prime Minister of the United Kingdom, Mr. Macmillan, this was mentioned. On June 13 the Ottawa Journal had the following report of a press conference with Mr. Macmillan:
Mr. Macmillan said a commonwealth development bank "to mobilize the potential savings of the commonwealth and to direct investment" would be discussed at the Montreal conference. Commonwealth free trade and the bank were "only my hopes and dreams".
Prime Minister Macmillan addressed members of the house and the Senate in this chamber on June 13, and on June 14 the following report appeared in the Financial Post:
Macmillan's Ottawa talks concentrate on finances.
1.	Action by the international monetary fund to increase, perhaps double, the reserves of the free world.
2.	Action by the world bank to bring at least a corresponding increase in the capital available for undeveloped countries.
Again this did not tell us exactly what would happen. We were still hoping there would be an increase in the price of gold. Mr. Macmillan went across the border to visit the United States, and on June 14 the following article appeared in the New York Times:
Officials believed Mr. Macmillan's optimism reflected success in "selling" to President Eisenhower and Mr. Dulles his ideas for increasing the "liquidity" of the western world so that the challenge of Soviet exports might be met through increased trade between the western powers and the underdeveloped nations of Africa and Asia.
Following this, in fact on August 27, an article appeared in the Globe and Mail containing the following:
Today-
The reference is to July 26.
-Mr. Eisenhower instructed treasury secretary Robert Anderson to back moves at New Delhi to throw more resources behind the fund and bank.
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We are told also that this will be done through increasing quotas and increasing the liquidity of the world bank and the monetary fund. However, in the same month an article appeared in the Montreal Gazette, part of which reads as follows:
This year the optimists are counting upon decisions reached at the commonwealth trade and economic conference here in mid-September to serve as a lever to pry the gold price into public debate. Once the issue is in the open, they believe, the chances for persuading American acceptance of a higher price are good.
I am not going to read the whole article, but only a few more extracts. In the article there is the following:
There is only one difficulty. However cogent, however strongly put, none of them answer the main American objection to a higher gold price. An increase would inflate American currency. Inflation, admittedly, is already present. But so far the government is still hopeful of keeping it under a measure of control. Deliberate inflation, such as would follow from a higher gold price increase, remains thoroughly undesirable. Moreover, the Americans are already convinced that the advantages of a higher price for gold-with the exception of those applying to the producers-can be pretty well supplied by expanding the functions of the international monetary fund and the world bank.
That is when we learned that this was to be done. I can understand the position of the minister when he goes to the commonwealth trade and economic conference. I can also understand the position of Britain in this matter. It will certainly be difficult to contradict the United States. I can see also why what I am about to read was added to this article:
Further, they would seem to have convinced the Canadian government of that point.
The United States would seem to have convinced the Canadian government that this was not the time for an increase in the price of gold, but that instead the functions of the international monetary fund and the world bank should be expanded by increasing quotas. The article continues:
The proponents of a higher gold price cite finance minister Fleming as their strong hope in pushing it through. Mr. Fleming may have preferred a higher price for gold but if so it hasn't been evident in his public pronouncements. Rather, the indications are that Mr. Fleming, like the Americans, favours the broader use of existing world monetary agencies.


Donald Methuen Fleming: From what paper did my hon. friend read that last quotation?


Armand Dumas: From the Montreal Gazette of August 21. I am not here to blame the minister, because I know pressure is being put on the United Kingdom and Canadian governments not to insist on an increase in the price of gold. Nevertheless I am hoping that the minister will discuss this matter at the commonwealth trade conference with other commonwealth countries. I am sure it can

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be discussed. Even if the United States does not like it, it is not their conference but our conference. Therefore I hope the minister will discuss the matter. I am not saying that the minister should go to New Delhi and try to raise that point very strongly, because I think it is understood before he goes there that this question should not be brought up. In the Northern Miner of two days ago the following article appeared:
There can't be any change by Britain in the price of gold so long as it owes money to the international monetary fund. By the same token, it would be impolite to even talk about it.
That is the position the Americans are taking. However, we know that this is a very important question for the commonwealth. After all, we know that an increase in the price of gold would do much good. In the same article in the Montreal Gazette about which the minister asked me there is the following:
There is no question that a higher price for gold would have been a proper step in the pre-war world. But the world has changed. Statesmen must deal with things as they are.
We still think there should be an increase. I do not wish to take any more time of the house, but will conclude by saying that we know that the need for reserves of some kind against the vagaries of international trade and capital movements remains undisputed. Gold therefore continues to be accepted as such a reserve, and is also prized as a means for effecting final settlement between countries. This is very true because we know that the international monetary fund, for example, expresses exchange parities in gold, and also that a portion of the subscription payments to the fund must be in gold or United States dollars and that it is specified that payment must be in United States dollars of the present gold content. The possibility that reserves of gold may now be inadequate has arisen largely because inflation has increased trade values at a rate much greater than the growth of gold reserves.
Were inflation to continue it would sooner or later become inevitable that the very retention of gold for use in international settlements would depend on a rise in the price. In the event that reserves are already inadequate, an increase in the price of gold should render international trade freer, more flexible and larger in volume. A higher gold price need not lead to inflation, owing to the divorce of money from gold. We are not on the gold standard now. This need not be inflationary, either, through its effects on public finance, given prudence in domestic fiscal policy.

Even if the minister has made up his mind not to insist at New Delhi on a rise in the price of gold, I know he is anxious to do it. I know that last fall he must have been very anxious to discuss this matter. I know that the minister, when he was on this side of the house, often blamed previous finance ministers for not having insisted on a rise in the price of gold. When he was saying that he did not know for certain that these ministers had not insisted on an increase in the price of gold. In fact we are sure they did. If the minister says they have not-


Donald Methuen Fleming: I have not seen evidence of it.


Armand Dumas: -we are told that they did. The minister may have mentioned this subject at the meeting last fall, but if he did nothing came of it. He is going on October 6 to New Delhi, and he will have another chance. As I explained before, we can appreciate that there may be difficulties. However, I still say that this subject should be thoroughly discussed at the forthcoming commonwealth conference. If the minister feels that other finance ministers have not done their duty in regard to the monetary fund, he will have an opportunity to bring that out. When he goes to New Delhi he can ask for an increase in the price of gold, and when he comes back he can tell us that he has attained his objective.


Donald Methuen Fleming: As the hon. gentleman has indicated there have been proposals put forward, both by the Prime Minister of Canada and the Prime Minister of the United Kingdom, in favour of an increase in the capital of the international bank for reconstruction and development, and also in the capital available to the international monetary fund. My hon. friend is aware of the statement that was made within recent days by President Eisenhower and the secretary of the treasury of the United States, Mr. Ralph Anderson.
It is quite clear that this proposal of an increase in the capital of these two important international institutions will be discussed at the meeting at New Delhi which opens on October 6. I hope to be in attendance at the meetings of the boards of governors of both these institutions. While the subjects are bound to be discussed at those annual meetings, it does not necessarily follow that final decisions will be taken at that time. The meetings normally last about five days. It may be that the board of governors will give a general expression of its views in relation to the subject and leave the matter for further discussion and further action at the executive level.

What an increase in the capital of the institutions will mean in terms of a possible increase in the contribution of gold to the fund on the part of contributing members of either institution remains to be seen. That will be determined entirely in relation to the terms that will be established and attached to any increase in the capital, and the form that the increase will take.
My hon. friend referred to some rumour that was current not very long ago that there was to be an increase in the price of gold. All I can say is that I have no information as to the source or grounds of the rumour. I think in general my hon. friend will agree that in the light of the position I have taken in this house over the years, and the things I have said in this house, I am not unaware of the interests of Canada as a gold producer.


Hazen Robert Argue: I have one matter I should like to raise before the item carries. I have a letter from Ralph Loomer, of Falmouth, Nova Scotia, in which he encloses a copy of a letter that was received by the credit unions in Nova Scotia. The credit union letter reads in part as follows:
Within the last few days many of you have had a visit or some form of communication from your bank advising of a new schedule of rates on all cheques cleared through the banks for credit unions and their centrals, such new schedule to become effective on November 1, 1958.
This new schedule of rates will adversely affect the entire credit union movement across Canada, including the caisses populaires and their federation in the province of Quebec. The greatest effect will be felt by the leagues, central credit unions, co-operative credit societies and credit unions offering a personal chequing service. The organizations that will be most adversely affected will be those central organizations with secondary chequing being cleared through the centrals.
This new schedule sets forth new rates that in some cases present a serious problem for the credit union movement. For us in Nova Scotia the picture looks something like this at the present time.
1.	The clearing fee of 2\ cents per item which we are now paying will be increased to 5 cents per item or just doubled. We expected to clear this year something between 25 and 30 thousand cheques.
2.	The service charge will be 10 cents per item both debit and credit as compared to no service charge at present.
The letter is quite lengthy and I do not intend to read anything further from it. If the minister knows anything about this particular matter now I would appreciate him giving us his opinion. If he has no information I would appreciate him looking into this question to see if the banks will reconsider the position they have taken. I think he will agree with me that the credit union movement of this country is performing a very worth-while service to its membership, and that anything that would add to its financial costs by way of clearing fees to the banks should not be enacted. I would hope the
57071-3-298
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minister would use his good offices to have these charges revert, if possible, to their previous level.


Donald Methuen Fleming: I shall be glad to look into it, Mr. Chairman.


[Stage Direction]
Item agreed to.
553. To provide for the expenses of a royal commission on Newfoundland, including the payment, notwithstanding the Civil Service Act, of honoraria or allowances as may be authorized by the treasury board to officers, clerks or employees permanently employed in the civil service for services rendered by them to the commission, $10,000.
John Whitney Pickersgill: I was grateful to His Honour Mr. Speaker for pointing out that I would have an opportunity to pursue the inquiry, though there is not much point in pursuing the inquiry itself, which I made to the Prime Minister this morning about his reply to an appeal made to him by unanimous vote of the house of assembly of Newfoundland, contained in a resolution which was moved by the premier and seconded by the leader of the Prime Minister's own party in Newfoundland and which was transmitted to the government, making a request that the province should be given what is its undoubted right by this parliament this session. I had not much hope the other evening when the Minister of Finance replied to the appeals to the government which were made by all the Liberal members from Newfoundland who were present in Ottawa at that time to accede to this unanimous request of the house of assembly. But the minister did not slam the door tight; that was left for the Prime Minister this morning. Despite this unanimous request; despite the fact that the leader of his own party in the house of assembly in Newfoundland had seconded this motion and that all the Conservative members had supported it, he indicated that no attention was going to be paid to the request.
This is an extremely serious matter. While there is nothing an opposition can do in the circumstances except protest, I certainly do so, and I have no doubt that my friends from Newfoundland on this side of the house will join in that protest. What is this request that the Prime Minister has turned down, and turned down for no valid reason whatsoever? It is a request made as long ago as August 11 in the first instance and made again by the assembly, as I have said, two days ago. It is a request that as an interim payment the amount recommended by the royal commission which was set up to complete the work of union should be paid and paid immediately. Why? Here are the premier's words in his original message of August 11:
I wish to stress the importance to the welfare of Newfoundland of immediate federal action on an

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interim basis. The commission has clearly shown that at least the amounts recommended are urgently needed to enable the provincial government to continue existing services.
That is what we are denying or rather what the government is denying, because I certainly take no part in it and we on this side of the house have shown by our speeches the other night that we take no part in it. May I say that I appreciate the support that was given to the position taken by the Liberal members and by our leader. I refer to the support that was given by the hon. gentlemen in the corner. We have shown that we feel this action should have been taken.
What is it that is being denied or refused? It is money that is urgently needed to continue existing services, not to have any kind of improvement but to continue existing services. I want to be fair about this matter. The Prime Minister said this in his reply to the appeal and the Minister of Finance the other night put it on Hansard. I will read it from Hansard; I may say that I am reading from page 4623:
We expect prorogation of parliament within very few days and it is quite impossible to complete full consideration of the royal commission's report in the meantime.
This is the part to which I wish particularly to draw attention.
Newfoundland is receiving $7,500,000 per annum as its share of the Atlantic adjustment grant and an additional three per cent of the yield from the personal income tax this year, neither of which would have been received by the province of Newfoundland had this government not come into office. These benefits, which incidentally exceed the amounts recommended by the royal commission, should enable you to meet the fiscal conditions described in your telegram pending final decision on recommendations of royal commission.
That is the reply. I do not contest that Newfoundland is receiving the Atlantic provinces grant. I do not contest that Newfoundland, like the other provinces, is getting the extra 3 per cent. But all those other provinces are getting these things to improve their services, to ameliorate their conditions. What does the Prime Minister say to Newfoundland? He says to Newfoundland, "You can take what the other provinces-every one of them richer than Newfoundland-can use for improvements and you must use it to continue your existing services." That is what this government is saying. That is the sympathetic attitude they have taken to the unanimous request of the legislature in which their own party joined.
That is the situation; there is no way whatever of getting around it. This feeble excuse that the government did not have time to consider the recommendations of the report is no excuse whatsoever. Unless the Minister of Finance, the minister from Newfoundland
[Mr. Pickersgill.l
or the Prime Minister is going to tell us that the government is considering cutting down this award, there is no excuse. If they are considering the possibility of cutting it down, then I think they ought to be honest and frank enough to get to their feet and say so. But if they are not considering cutting it down, and if all they are considering is either keeping it as it is or increasing it, there is no ground under the sun for denying the minimum amount recommended by the commission.
No reason was given either by the Prime Minister or the Minister of Finance the other night. I cannot understand why the government should have taken this attitude. Knowing that they would have no debate, knowing that there would be no difficulty about getting this vote through, I cannot conceive of a reason why the government should take the attitude they have taken or why they should not have acceded immediately to this request for what is, after all, the right of the newest province of Canada. I venture to say that if Ontario or Quebec had been asking for their rights, and if the premier and leader of the opposition in the legislature of Ontario had sent a joint appeal to have something done to which they had a right under the British North America Act, there would have been no similar hesitation on the part of the Prime Minister or the Minister of Finance.


Some hon. Members:: Oh, oh.


John Whitney Pickersgill: I venture to suggest that if the same request had come from the premier of Quebec seconded by the leader of the opposition in that assembly there would have been no hesitation at all, if it was their right, as this is. But because it is Newfoundland this attitude is taken. I am not going to assign reasons; I am not going to impute motives. I will leave the government to explain this matter themselves.
It seems to me that more than from any other member of the government, the one from whom we ought to have that explanation is the minister who represents the province of Newfoundland in the government of Canada. The minister sat silent the other night when we on this side of the house representing the province of Newfoundland made our appeals to the government. I am not criticizing him for that. I recognize the fact that, while the matter was still under consideration, while the government had not reached a final conclusion, the minister under the doctrine of collective responsibility had no other course to follow. I found myself at times in the same position as that in which the minister found himself that evening, and I offer no criticism on that score.

But the decision has now been taken; it has now been announced. The government has said no to Newfoundland. It has said no to the unanimous request of the province. It seems to me that "no" should be explained, that we should know why this reasonable request has not been met. That is the more true, Mr. Chairman, when one thinks of the fact that the Prime Minister himself clearly recognized what the situation was at the time of the provincial conference last November. At that conference the premiers of Nova Scotia and New Brunswick both suggested that Newfoundland should not participate in the proposed Atlantic provinces grant because Newfoundland's case was a separate and different one.


The Chairman:: Order. It being one o'clock I do now leave the chair.


Lester Bowles Pearson: We would be prepared to continue.


Donald Methuen Fleming: Would the committee give unanimous consent to continue this sitting after one o'clock?


Some hon. Members:: Agreed.


Joseph Pierre Albert Sévigny: Is it the pleasure of the committee that the sitting continue after one o'clock?


Some hon. Members:: Agreed.


John Whitney Pickersgill: I would suggest to the minister that he try to exercise a little of his influence on some of his supporters who do not seem to understand what an important question is now before the committee, particularly when we are sitting at an hour not prescribed by the house.
As I was saying, Mr. Chairman, this position was recognized clearly and explicitly by the Prime Minister at the federal-provincial conference last November. At that time the premiers of Nova Scotia and New Brunswick said or implied-in fact I think there is no doubt, but I do not want to be unfair to them and I do not want to waste time in reading that part of the record so I say "said or implied"-that Newfoundland should not participate in the Atlantic provinces grant because the Newfoundland situation was being considered by a royal commission. This is what the premier of Newfoundland had to say in reply to this contention, as reported at page 100 of the proceedings: Yesterday Premier Stanfield In his magnificent speech, and Premier Flemming in his magnificent speech, each had a paragraph of identical meaning referring to Newfoundland. You, Mr. Prime Minister, referred specifically to Newfoundland but in other terms, I am happy to say.
1 got the impression from these two friends of mine that they are under the impression that so far as this conference is concerned Newfoundland 57071-3-298J
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might as well not be here, that our ease is being taken care of by the royal commission. That is not so.
No matter what the royal commission recommends, no matter if they recommend the full amount we have asked for and if you and your colleagues recommend that amount to parliament and parliament passes it, all it will do will be to enable us, to enable the government of Newfoundland, to continue-
And I emphasize this once again.
-to continue the present levels and standards of our public services which are a quarter of a century behind the maritimes. That is all it can do at the most.
That is why I noted so carefully your words yesterday-
This is addressed to the Prime Minister.
-when you did not by any manner of means suggest that Newfoundland had no place in this conference today and yesterday. I thank you and Newfoundland thanks you for that.
Later on, as recorded lower down the page, he had a further comment-I am going to read as little as possible in order to take as little of the time of the committee as possible -to the effect that as the result of certain things into which I will not go at the moment, Newfoundland was left behind in the North American progress, and then the premier went on to say the following:
We ask the Canadian government this simple question: Do you really think, does Canada think, does the parliament of Canada really think, does the Prime Minister think, that Canada has done its duty to the new province when it implements the recommendations of the royal commission which will enable it to maintain our present levels and standards?
Is that all? Are we not to be invited to future fiscal conferences? Does that settle Newfoundland's case, just the implementing of the report of the royal commission? Are we not part of this fiscal conference when the Prime Minister said yesterday that he will recommend to parliament some additional and special consideration for the Atlantic provinces? In adopting the new term "Atlantic provinces" did he not include Newfoundland? I am sure he did. Was that not something separate and apart altogether from the royal commission? Surely the recommendations of the royal commission have nothing to do with this fiscal conference, nothing whatever.
The Prime Minister replied, as recorded at page 101, as chairman of the conference in the following words:
I will say no more at this time, but I would point out to the premier of Newfoundland that when I used the expression "the Atlantic Provinces" I anticipated what his views would be in regard to the use of that expression.
I think that clearly indicates that the Prime Minister at that time understood quite clearly that the Atlantic provinces grants were intended to be available to Newfoundland in the same way and for the same purpose as they are available to the three maritime provinces; that is, to make improvements in their services and not merely to continue the

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existing situation; and that there is no connection, and should be no connection whatsoever, between the two subjects.
Then we had the telegram to the premier of Newfoundland on August 26 saying, in effect: "You got these Atlantic provinces grants which you would not have got if we had not been in office, but you cannot use them like the other Canadians can use them. You have to use them for existing services because we are not going to give you what you have a right to have," that is to say the award of this royal commission. That is what the Prime Minister is saying. He is saying, "You are a second class province; you are not entitled to your rights". That is what it is, and let there be no mistake about it whatsoever.
I am the more surprised that this decision should have been announced in the final way in which it was announced this morning, because I have looked over some of the things said in the past by the minister from Newfoundland when he sat on this side of the house. On April 23, 1951, as will be found at page 2306 of Hansard, there is one sentence which I would like to read from a long speech by the minister which in large part supports this particular sentence. He referred to term 29, and having quoted it he said:
That section gave a term of eight years within which this royal commission should be appointed. But it has been my opinion from the beginning that the financial terms have been inadequate.
The minister went on to point out that the previous government should do something about this at a time when they were supposed to be derelict in their duty in not doing it, and that is the position-I am sure he will correct me if I am wrong-which he consistently took during that parliament and which was taken also by his associate the late Gordon Higgins, who also spoke eloquently on this subject in the house. Thereafter the minister became a candidate for parliament and in 1957 was successful in being re-elected. He became a member of the government, and the representative of the province of Newfoundland in the government.
I could quote many other citations similar to this one but on May 1, 1957, the St. John's Telegram quotes the minister to the following effect:
If elected, Mr. Browne said, he would "fight personally to see that we get better terms from Ottawa (under terms of union which come up for revision this year) and to convince our party of the justice of our case". He wants to fight personally because Newfoundland's "financial future depends on how parliament treats the report of the royal commission at the next session."
That was in 1957; that was what the minister said, and it is perhaps more than anything else why he got elected. If I remember

rightly both newspapers in St. John's supported the hon. gentleman because they felt that Newfoundland needed advocates of its cause on both sides of this house. Perhaps I would not have agreed with their support of the hon. gentleman, but I agree that we do need advocates for Newfoundland on both sides of the house, and I am anxious to hear what that hon. gentleman is advocating for Newfoundland, because we have not had any evidence of that as yet.
It is not as though the minister said this before the election and then said something else afterwards, because on June 11, 1957- a day that many of us will remember, particularly on this side and perhaps on the other side of the house too, for a long time to come-the minister made a statement about his election and, again to quote from the St. John's Telegram, he is reported as follows:
Personally he was extremely happy that through Its representation in parliament, Newfoundland's interests will be protected especially in the matter of the financial compensation that we should receive and expect from the federal government.
This, therefore, is not a new matter for the hon. gentleman and I think we should be told by him why it is, and with what justification, that this course has been taken, at least with his tacit approval however much he may have fought against it in the cabinet. He has to share the collective responsibility for this slap in the face to the whole house of assembly and the whole province of Newfoundland which he and I were both elected to represent. I also think he should tell us what he is going to do about getting that consideration which was promised by the Prime Minister in reply to the question of the Leader of the Opposition on August 15, and which in large part, despite other preoccupations, could have been given between July 10 and September 6, the approximate two months during which the government had this report in its possession.
I do not rest my case there because I am willing, as I say, to give the government a year or even two years to consider the report if this interim payment is made, if the basic amount is paid, but what we do protest against is this pointblank, blunt refusal to accede to the request, the well merited request, made by the premier and the leader of the opposition of Newfoundland for what is the right of the government and people of that province.


Chesley William Carter: I would be failing in my duty to my constituents and my province if I did not add my voice to the protest which has been raised by the hon. member for Bona-vista-Twillingate, and I want to protest all the more vigorously because neither the

Prime Minister nor the Minister of Finance nor any spokesman for the government has given one single reason why this interim payment should not be made.
I want to put on record seven reasons why interim payments should be made. My first reason is that these payments have been recommended by a royal commission after a very thorough study of the economic circumstances and the needs of Newfoundland. My second reason is that this assistance is one of Newfoundland's rights, emanating as it does from term 29 of the terms of union, and was recommended as such by the commission. In the third place, Newfoundland has not received any payment which has not also been granted to other Atlantic provinces. Not a single cent has gone to Newfoundland which has not also gone to the others. However, refusal of this grant prevents Newfoundland from making full use of grants in the way the other provinces are able to make use of them.
My fourth reason is that the grants are long overdue. They are overdue by more than a year. My fifth reason is that the grants have been requested by an unanimous resolution of both parties in the Newfoundland legislature, the government as well as the Conservative opposition. That request has been made in the full knowledge of Newfoundland's needs and of the urgency of the situation, which was sufficiently great to put this matter beyond the ordinary lines of party division.
My sixth reason is that the government has itself appealed to the provincial governments to do everything possible to work out a program of public works in order to provide more employment during the winter months. The government of Newfoundland has complied with that request and developed a program of works which would create employment, particularly during the winter months, but now by its action the federal government has nullified those efforts on the part of the provincial government to comply with this government's own request.
My seventh reason is that Newfoundland is faced with the prospect of the worst winter this year that it has experienced since the hungry thirties. By granting this request for an interim payment the federal government would not be committing itself in any way; neither would the granting of an interim payment interfere with the federal government's wish to give the fullest consideration to the recommendations of the commission. However, by its refusal the federal government has decided to condemn Newfoundland to a retarded rate of progress and to condemn Newfoundlanders to unnecessary hunger, hardship and suffering.
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I therefore appeal again to the Minister without Portfolio, the hon. member for St. John's West, to use his influence with his colleagues in the cabinet in order to have this decision reversed.


Mr. Batten:: I want to add my voice to the protests that have been made here this morning by the hon. member for Bonavista-Twil-lingate and the hon. member for Burin-Burgeo. It does seem to me that there are no grounds at all for this refusal by the present government to acknowledge the findings of the McNair royal commission and thereby give Newfoundland what we think is a final settlement of that agreement entered into in 1949.
I could agree with the Prime Minister that maybe there is good reason for taking time just now to study this report further, and I have no objection to that; but I do believe it is only fair and just that an interim payment should be made now so as to avoid the hardship that will come to Newfoundland during the coming winter.
I can see no reason why we have not heard from the hon. member for St. John's West; I do not know why he has not given us the benefit of his opinion in this instance. I believe I am speaking for all Newfoundlanders when I say we ask for nothing which is not our right, and at this time we come to the Canadian parliament asking for nothing more than justice without equivocation.
There is little need to recount the facts concerning term 29. That has already been done. There is no occasion now to comment once more on the foresight of those who included this term in the terms of union, or to restate the significance which Newfoundlanders have attached from the very beginning to this particular term of the agreement. Implementation of the recommendations of the McNair royal commission in the manner, the speed and the degree in which it is done will be a measure of the desire of the Canadian government to honour an obligation undertaken on behalf of the Canadian people.
I listened with some concern to the very definite statement made by the Prime Minister today; and while I can agree that he may require more time to study this document and give further consideration to the case, I can see no reason why an interim payment could not be made so that Newfoundland might be able to carry on over the present year at least. I was talking to an hon. member yesterday following a previous discussion in this house, and he gave me the idea that he was of the opinion that this was all a one-way street.
May I tell the committee that the union of Newfoundland with Canada was not a

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one-way street. I believe the stature of Canada as a nation was enhanced when Newfoundland joined Canada in 1949. It was a section of this land, formerly a dominion in its own right, which elected by a free vote of its people to become a part of Canada and the tenth province of this federation. It is true that Newfoundland has received many social benefits and also the services of government departments which have become highly specialized over the years. These have been a great blessing to Newfoundland, but it must not be concluded that because of that fact there has not been something else going in the other direction. Over the last eight years Newfoundland has been making a substantial contribution to the Canadian economy on a commercial, financial and economic basis, and I submit that this contribution is capable of measurement because Newfoundland, unlike the other provinces of Canada, did not grow with confederation. It elected years ago to maintain its independence, and because of that fact it is now possible to measure the contribution which Newfoundland has been able to make to the Canadian economy.
It should be remembered, too, that when Newfoundland became a province of Canada it did so at a time when it was enjoying the greatest prosperity it had ever enjoyed. There was no time in the history of the province when its condition was as happy as in 1949, so the union of Newfoundland with Canada was not a device to avoid the risk of financial peril. It was a desire on the part of Newfoundland and the people there to become a part of this great nation. It is now the duty of this committee to affirm and consummate its obligation with respect to clause 29 of the terms of union agreed to in 1949. We find the present government unwilling to honour that obligation.
I say again the union of Newfoundland with Canada enhanced Canada as a nation. It added 400,000 people to the population of this country. If these people had been brought here from some European country a considerable amount of money would have been paid to bring them and establish them here as Canadian citizens. But not only did they not have to be brought and established here; they brought with them many things of benefit to Canada. They brought to Canada an addition to its area of 155,000 square miles of territory, adding a considerable area to the portion of Canada below the 60th parallel, Labrador with 112,000 square miles and Newfoundland with 43,000, approximately twice the size of Nova Scotia or approximately 80 per cent of the total combined area of the other three maritime provinces. From a military standpoint the union brought with it

control of the north Atlantic approaches to North America as well as a major protection to the security of Canada.
We have only to look at the mineral resources to see something of the further contribution Newfoundland has made to Canada. In the last few years we have heard a great deal about the iron resources of the United States, the Mesabi range, and about where iron resources will be found in the future. Those who have taken the trouble to read the report of the Paley commission of 1952 will have some idea of the need for iron ore in the United States and Canada. In 1953 Bell island alone was able to provide 40 per cent of the total Canadian production of iron ore. In that year the total production was 6.5 million tons. In 1955 this one mine alone was able to provide 45 per cent of the total iron ore production of Canada.
Oh, yes; Newfoundland has made a substantial contribution to the Canadian economy. This does not take into account the other tremendous iron ore reserves that exist in Newfoundland and Labrador. Looking at it from another point of view, when the reserves are further developed in Labrador, and when Bell island has assumed still more importance, Canada will be making a great demand on the production which will be available from these sources. The iron ore mines of Bell island produce an ore which has an extremely high silica and phosphorous content. The ore of Labrador has a comparatively low silica and phosphorous content. If we are going to develop our mines on Labrador there will be need to develop further the mines of Bell island so there may be a mixture of these two ores for the blast furnaces of Europe. One could go on and talk about copper, zinc and lead and the contribution of these resources Newfoundland is able to make to the Canadian economy, thus increasing Canada's mineral production.
It has often been said that the forest products of Canada are her very greatest resource. In Canada we produce many tons of newsprint each year. Newfoundland with a population of only 2.5 per cent of the total Canadian population has increased newsprint production in Canada by 10 per cent since union in 1949. On this island we have considerable forest resources, and the same is true of Labrador. These are adding much to the economy of Canada. I still contend that in the union of Newfoundland with Canada it was able to make a real contribution to the economy of the country.
Our fishing industry is important to Newfoundland and to Canada. In 1954 Newfoundland was able to produce 29.8 per cent of the total landings for that year, not an insignificant amount. It has been said, too, and

I believe with a great deal of merit, that any domestic market is far better than a foreign market. On the island of Newfoundland there is a domestic market of $200 million each year. Many of the things Newfoundland bought before 1949 came from other parts of the world. Today between 85 and 90 per cent of the imports of Newfoundland come from the Canadian mainland.
I believe that in consideration of the fact that the union of Newfoundland with Canada was not a one-way street in the first place, and second because what is being asked for now is only a consummation of the terms of union entered into in 1949, further consideration should have been given this request; and it could have been given on a non-partisan basis since the suggestion made to the Prime Minister was made not by the premier of Newfoundland alone but one in which he was joined by the leader of the opposition in that province.
The request that it made of this committee today is made by the people of Newfoundland. In 1949 they thought whatever agreement was entered into would be honoured by the federal government. I say again that what we are asking now is nothing more than justice without equivocation.


Mr. Tucker:: Mr. Chairman, I wish to
associate myself with what has been said by hon. members from Newfoundland regarding this payment to that province. I agree wholeheartedly with what has been said by those hon. gentlemen.
I have learned that the legislature of Newfoundland has unanimously agreed that this house be requested to pay to Canada's newest province, England's oldest colony, the amount that has been recommended by the royal commission on Newfoundland's finances after a careful study of term 29. I also understand that many expenditures set up in the estimates of Newfoundland for the fiscal year cannot be met without an interim payment from the federal government. By making this payment the Prime Minister and his cabinet should not be deterred from giving consideration to the recommendations contained in the McNair report relative to increasing the amount beyond $8 million per annum.
In view of the above I hope the Prime Minister and his colleagues will give further consideration at the earliest possible date to the joint request of the legislative assembly of Newfoundland. Thus far it seems that the request is like a voice crying in the wilderness. We are asking only that Newfoundland be treated as any other province and extended the same rights. Our joining the other nine provinces made our relationship with Canada
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a two-way street of mutual benefit. I feel, therefore, that I must join in the protest of the hon. members who have spoken before me.


Donald Methuen Fleming: Mr. Chairman, this subject was discussed at considerable length in committee of supply two days ago. At that time the hon. member for Bonavista-Twillingate said he was speaking in a nonpartisan tone and making an appeal to the government. On behalf of the government I responded to that appeal in, I think, a like spirit and indicated that the government viewed this as a serious matter calling for very careful consideration. At no time has there been any refusal whatever of any just claim on the part of Newfoundland.
But today the hon. member has unleashed a very bitter attack on the government, and has made some charges based apparently on the assumption that there has been some refusal on the part of the government. There has not. This report remains, in the view of the government, a report relating to a matter of very great importance to fiscal relations between Canada and Newfoundland. It is a matter that affects fiscal relations not simply today but in the years to come. It is a matter which, if it is to receive justice, must have the most careful consideration.
I placed on the record two days ago two of the telegrams which have been exchanged between the premier of Newfoundland and the Prime Minister of Canada. I drew attention to the fact that the premier of Newfoundland had publicly expressed gratitude for the position taken by the Prime Minister of Canada in this house in stating that this matter, because of its importance, should and would receive very careful study on the part of the government. In my remarks I enlarged on the fact that under the pressures of the session it simply had become impossible to give to this large question that careful consideration which it merits, and on that and the Prime Minister's statement today hon. members opposite have mounted their attack this morning.
You will not have forgotten, Mr. Chairman, that there were two factors in the situation which led the government to indicate that action by way of provision of an item in the estimates would not be possible in the dying days of the present session. The first, of course, is one I have mentioned, that the matter is a very large one and the report must receive careful and thorough study. The other, however, was one that the Prime Minister emphasized and which has received further emphasis, not mentioned by hon. members opposite, within the past twenty-four hours. That further fact is that the report has not been received with acceptance

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by the government of Newfoundland. Indeed, the report has been the subject of the bitterest attacks on the part of the premier of Newfoundland.
Had this been a report whose recommendations had been accepted by the government of Newfoundland the matter might have appeared in a different light, but we are asked now to take action to fulfil for this year the full extent of the recommendations in the report while that report is still denounced by the recipient government. To proceed in the way that we have been challenged today to proceed would, I think, hardly be regarded as responsible in the light of the existing condition. I emphasize that the report has not been accepted at any time. Immediately it was made public it was received with strong expressions of dissatisfaction and critical comment in Newfoundland by the premier of that province.
If anything had been lacking in the expressions of dissatisfaction and criticism on the part of the government of Newfoundland at that time, certainly that lack has been filled since, for today's noon editions of the Ottawa papers carry reports of statements made in the Newfoundland legislature yesterday by the premier of Newfoundland. I shall read just a few extracts from the report. It is a Canadian Press dispatch from St. John's dated September 6:
Premier Smallwood says the McNair royal commission that recommended Newfoundland should receive an additional $8 million annually from the federal government "was a dead loss". "This is the first time I said it publicly", he told the legislature yesterday. "The work of the royal commission was a dead loss. And the commissioners are also a dead loss. I recommended the appointment of some of those commissioners-God forgive me."
The commission consisted of chairman Chief Justice John B. McNair of the New Brunswick supreme court. Chief Justice Sir Albert Walsh of the Newfoundland supreme court and Professor John Deutsch.
It was appointed by the last Liberal government in Ottawa to determine how much Newfoundland needs to keep public services at their present level
Provision for the commission was made in term 29 of the terms of union with Canada, signed in 1949 when a Liberal government was in Ottawa.
Premier Smallwood surprised some members by announcing, I m glad that there was a change of government in Ottawa" following the last federal election. "I was glad the minute it happened. Twenty-two years in power is too long...I don't think it s good that they got such a majority. They should have got a substantial majority but not that big.
He assured he house, "In Newfoundland I'm a Liberal. But I am a confederate before I am a Liberal. My prime interest in life is to see confederation succeed regardless of what complexion the federal government is."
Then he proceeded, as this article indicates, to attack various features of the report and some of the statements made in the report concerning conditions in Newfoundland. The

article makes mention of the fact that the opposition leader, Mr. Malcom Hollet, had said earlier that the commission might have recommended more if they had seen conditions in the White bay area. Then the article continues:
"That's the trouble", Mr. Smallwood said. "They wouldn't go. You couldn't budge them. They practically mutinied when we tried to show them pictures of our institutions."
These are but a few of the statements that could be taken from this report, and these are the words of the premier of Newfoundland delivered not months ago, not weeks ago, but only yesterday in the legislative assembly of Newfoundland. These are attacks on his part delivered against the report, and this is the report that we as a government in the dying stages of this session are expected to adopt and to ask the house to implement.
I think a great deal more consideration must be given to this situation, to the report, its recommendations and the conditions that can be given to the matter under the pressure of this particular time. We would not be doing justice to this large subject to act now in the way we have been asked to act in the face of these crushing attacks delivered against the report by the premier of Newfoundland himself. Surely it is not to be said that we are somehow in default in not moving to implement the report when the report, so far from meeting with satisfaction on the part of the government of Newfoundland, has evoked such bitter and crushing attacks by the premier of that province.
I have only this to say in conclusion, and it is a repetition of what I said on Thursday and earlier today. There has been no refusal on the part of the government to consider this matter. On the contrary, there has been the plainest undertaking on the part of the government to give this matter that careful consideration which it merits, having regard to the importance of the subject involved and the interests of Newfoundland in her fiscal relations with the federal government. That careful study will be given. That careful study which the subject warrants could not be given under the pressures of these recent days and in the dying minutes of this session.


Lester Bowles Pearson: I am amazed at the argument advanced by the Minister of Finance in explaining the refusal of the government to make this grant available to Newfoundland for this year so that Newfoundland can make up its budget on the basis of this amount, which it had every reason to expect, as an interim amount. The argument the minister used the other night, or one of the arguments he used, was to this effect. Well, Newfoundland was getting its share from the

Atlantic provinces grants for the improvement of services, and that should be enough for the maintenance of services.
At least he has not repeated that argument today, but what he has done to support his case is this. He has quoted from the current edition of the Ottawa Journal, repeating the argument that because the Newfoundland government and the opposition there are disappointed at the amount recommended by the royal commission, because they think it should be much more and because Mr. Smallwood has expressed himself so forcibly on that score, they should be given nothing at all.
The reconsideration which the Newfoundland government and the Newfoundland house of assembly want is a reconsideration upward. In other words the argument is that because you in Newfoundland asked for more as a long-term proposition, we will give you nothing now. There is no escape from that conclusion. We are not asking the government to decide on a long-term policy at this time. We are asking the government to live up to its pledge to implement that particular recommendation of the report which will make it possible for Newfoundland now to maintain its services. That is all we are asking.
Obviously they are not going to get that. The minister has said, why should we be asked to consider this matter in the dying days of this session? The fact is that in the dying days of this session they put in the supplementary estimates an item of $40 million for grain growers and one of $8i million for universities-we are not complaining about that

they were able to do that in the dying days of this session but they were not able to do this for Newfoundland in the dying days of this session. The report making this recommendation was in the hands of the government on July 10 and the session was not dying on July 10, though the government may have felt like dying at that date.
In any event that is the situation, and no amount of specious argument on the part of the minister can alter the facts. What the government says is this; because you want a loaf, we are not going to give you half a loaf. That is the situation. We will let it stand at that.


[Stage Direction]
Item agreed to.
University grants-
669. To provide that the rate of $1.00 mentioned in vote 541 of the Appropriation Act No. 1, 1957, is struck out and the rate of $1.50 is substituted therefor; and that a new agreement may be entered into accordingly with effect from the first day of April, 1958, between the national conference of Canadian universities and the Minister of Finance; the amount provided for in vote 127 of the main estimates for the present fiscal year to be applied to the purpose of this vote; additional amount required, $8,500,000.
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Donald Methuen Fleming: This is the item under which it is proposed by the government that the rate of $1 provided in vote 541, which has already been approved, should be struck out and the rate of $1.50 substituted therefor for aid to Canadian universities. I think I should say a brief word on this subject and in relation to some of the considerations that have been raised in this house in regard to it.
The grants to universities from federal sources were initiated in the fiscal year 1951-52. At that time the grant was less than $8 million. It was fixed at the rate of 50 cents per capita of population in Canada. That amount was raised one and a half years ago to $1 per year. Item 669 now before the committee proposes that it should be increased by a further 50 cents per capita to a total of $1.50. That will raise the appropriation this year to something over $25J million.
When this was announced in the house a few days ago the hon. member for Laurier asked me whether there had been any indication on the part of Quebec that these amounts would be accepted by that province. I gave a negative answer. The first year these grants were made available by parliament, in 1951-52, they were accepted by the universities of the province of Quebec, but not since then. In the meantime, in accordance with the provisions of the vote year by year and latterly in accordance with the terms of the agreement between the Minister of Finance and the national conference of Canadian universities, which governs the distribution of these amounts, the unclaimed portion has been accumulating. As the portion of the total grant available to the institutions of higher learning in Quebec has not been accepted by them, the amount allocated for that province has been accumulating. By the end of this fiscal year, March 31, 1959, the amount that will have accumulated for the institutions of higher learning in the province of Quebec will amount to about $15 million. The accumulation will become more rapid by reason of the increase that is now proposed.
I wish to make it clear on behalf of the government that we would wish the institutions of higher learning in Quebec to have the benefit of the provision intended on their behalf by parliament. The province of Quebec has more than a quarter of the population of Canada. Last year it had one-third of the students of all of Canada attending institutions of higher learning. Quebec pays its full share of taxes out of which this vote is made available, and the matter has been the subject of representations made by our members of parliament from Quebec.

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Let me make it abundantly clear, Mr. Chairman, that this government will always scrupulously respect the terms of the Canadian constitution. It is plainly recognized that education is a field of jurisdiction exclusively assigned to the provinces under the British North America Act. As long as this government is in office there will never be any attempt made to trespass on that jurisdiction exclusively vested in the provinces.
The distribution of these sums is governed by an agreement which is referred to in the main estimates. It is an agreement that was entered into between the then minister of finance, my predecessor Mr. Harris, on March 26, 1957 and the national conference of Canadian universities, which is an incorporated body. Some change is anticipated before long in the constitution of that body, but it will not basically affect the provision for distribution of these sums through the national body that represents the Canadian universities. The agreement is in fairly general terms, but it is the document that now governs the method of distribution under the provision made by parliament year by year through the item in the estimates.
I emphasize, Mr. Chairman, that in reference to this subject of the basis of distribution this present government makes no rigid approach. We adopt no take it or leave it attitude in regard to this basis of distribution. The agreement which has been in effect now for a year and a half stipulates that the amount to be allotted to any province is determined in accordance with the population of the province. It is a straight per capita reckoning. The sum is provided on a population basis for the institutions of higher learning of any province, and is then to be distributed among those institutions in accordance with the student enrolment in courses as defined by this agreement.
Now I say, Mr. Chairman, of this agreement in relation to the attitude of the present government, that while the formula contained in the present agreement has not so far been such as to be viewed with favour in the province of Quebec, if there is any formula or modification of the present agreement which anyone cares to put forward which would permit the institutions of higher learning in the province of Quebec to participate, and which is in keeping with the national interest, we as a government are prepared to give it serious consideration.
In order to make more clear the government's position with respect to the constitutional issues that may be regarded by some as here involved, let me close by saying this.

(Translation):
The government respects and will always scrupulously respect, the constitution of this country. We recognize and we respect the provinces' absolute jurisdiction in the field of education. The increased grants proposed by the government are merely a necessary aid to universities, without government infringement upon a single provincial responsibility. As long as this government is in power, it will never encroach upon education, which is a provincial matter.


Mr. Chevrier:: Will you always respect provincial rights as did the Right Hon. Mr. St. Laurent?
(Text):


Lester Bowles Pearson: I wish to take the time of the committee for a few moments, Mr. Chairman, to talk about this very important subject. I regret that it has to be done at this hour, without benefit of luncheon, but I think it is a good thing that we should be sitting right through in this way in order to complete our work. This is an important matter, and I think I should say a few words about it.
There is no doubt that in this country in the field of higher education we are approaching-I do not think the word is too strong- a crisis in the sense that there are increasing costs, increasing needs and inadequate income to meet those costs and those needs. The obligations of government in this respect are greater than ever, and this includes the obligations of the federal government in this field of higher education, always having regard to what my hon. friend has just emphasized, the paramount necessity of respecting the authority, control and jurisdiction of the provinces in the field of education.
There has never been any desire on the part of anyone on this side to interfere with that control or that jurisdiction. When these grants to universities were initiated by Mr. St. Laurent and his government in 1951, that was made quite clear. Mr. St. Laurent was scrupulous in never departing from that principle.
When my hon. friend affirms, as he has affirmed-I wish I could affirm it as eloquently in French as he did-the policy and principle of the government he is, I am sure he will admit, carrying on the policy and principle that was followed by the previous government in this field. When he says they would welcome a formula which would make it possible for Quebec to accept this kind of assistance, I can assure him that when we were in office certainly we would have welcomed any formula which would have made that possible; indeed, we certainly sought such a formula.

Now, the need is apparent and the obligation of even the federal government is apparent in connection with this matter, subject to the qualification I have made. At the present time in this country 11.3 per cent of our income is spent by all levels of government on education, and 23.1 per cent goes to defence. The needs, as I say, are increasing. The universities must expand to meet those needs, and unless financial considerations prevent it they will expand. The Gordon commission, in its report on education, estimated that in the fall of 1964 there would be an enrolment in our universities of 113,000 students. In 1955 the bureau of statistics presented a projected university and college enrolment in Canada which estimated that in a 10-year period, which would be the fall of 1964, that enrolment would reach 128,900 students. I think the figure at present is something between 80,000 and 90,000.


Donald Methuen Fleming: The figure, when the term closed last spring, was just around 81,000, and that was a 10 per cent advance over the total of the year before.


Lester Bowles Pearson: This shows the problem with which we are faced in the expansion of university education in this country. We are faced with the same problem in respect of capital requirements to take care of this expansion. An estimate has been made that for the next five years $314 million will be required to take care of this essential capital expansion, so the question arises at once, where is this money to come from?
In 1956 of the amount expended on university education in Canada, 6 per cent came from endowments, a decrease in percentage though an increase in absolute terms and 28 per cent came from fees. That is a high proportion of the expenditure compared with 11 per cent in the United Kingdom coming from fees. This is a heavy burden on student fees as compared with the United Kingdom. Provincial governments were providing 40 per cent of the cost and the federal government is now providing 15 per cent of the cost of higher education in this country. About 55 per cent is coming from governmental sources, while in the United Kingdom 70 per cent of the cost of university education comes from government. Other sources in this country provide 11 per cent.
Over the years the federal government has assisted in university education. When I was looking into this matter I was surprised to find how much had been done for higher education by the federal government, in the form of direct aid, in the form of scholarships and so on. I do not desire to detain the committee by going into it, but the direct aid has been substantial since world war II. There 57071-3-299i
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has been aid to veterans and their children, vocational assistance and the officer training plan, which is a very important contribution. There have been the national research council scholarships, scholarships given by a federal agency which have been accepted I think without question by all the provinces. This has amounted to about $25 million. Then there is assistance to universities through departmental grants for research and for extension work in health, agriculture, labour, fisheries and transport.
There is, therefore, nothing new about assistance to universities by the federal government, and that assistance has been accepted in some form by all provinces.
Then we have the grants in aid about which we are talking on this particular item. As the minister pointed out, those were instituted in 1951. In 1958 these grants amounted to something over $17 million, and the minister proposes to add $8.5 million more for that purpose. We on this side most warmly and heartily support that increase. There is also the assistance given by the Canada Council of $1 million a year in scholarships. Capital assistance for construction from the Canada Council up to March 31, shared by 12 institutions, has reached the amount of $4 million. This help to universities, as the minister has said, began in 1951, and I think it is not inappropriate at this time to pay a sincere tribute to Mr. St. Laurent for his interest in this matter and for all that he did.


Some hon. Members:: Hear, hear.


Lester Bowles Pearson: Nothing I could say would equal in eloquence the tribute paid to Mr. St. Laurent at the conference of Canadian universities in 1956 by the chairman of the conference, who is now the Secretary of State for External Affairs. On that occasion in paying tribute to the wise and far-sighted leadership of Mr. St. Laurent he had this to say:
The aid that his government has extended to the Canadian universities has been given without a hint of a tendency of a suggestion of a suspicion of a trend towards a desire to undermine their academic freedom.
And he concluded as follows:
We thank you, sir, in a mood of gratitude not unalloyed by an expectation of benefits to come.
Those benefits came shortly after. They were then doubled, and today are being increased by this amount in the estimates. We certainly welcome this measure.
There is one feature I would like to call to the attention of the minister which perhaps could be improved upon. I agree that the grants should be increased, and they are now being increased. They should be increased without any strings attached to them, and that is the case here. I am sure care has

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been taken to ensure that there should be no suspicion of any strings being attached by the manner in which they are being distributed through the council of Canadian universities. However, the present formula for allocating these grants, as the minister pointed out, is based on the population of each province and, within any province, those amounts are distributed in proportion to the number of students attending approved higher educational institutions.


Donald Methuen Fleming: In accordance with the definition in the terms of the agreement.


Lester Bowles Pearson: Yes, as defined, which makes them acceptable. Perhaps this formula could be altered as recommended by the national conference of Canadian universities, because in its present application the provinces with small populations but high proportions of university students do suffer. The grant for 1957-58 for Ontario per student-perhaps the minister could give me the exact figure, because I was not able to get it-


Donald Methuen Fleming: For Ontario, $252 for 1957-58.


Lester Bowles Pearson: I had $238, but the student grant for Nova Scotia was only $148. That is of course due to the passionate desire of the young men and women in that province to have a university education, and no doubt the ease with which they qualify for such education. But perhaps the government could look into the formula recommended by the universities to see if it could be made somewhat more equitable in its distribution.
We have put forward some proposals in this field, and I just want to place them on the record, which will only take a very short time. We have proposed that the federal government should provide 2,500 Canadian scholarships and 7,500 bursaries every year to students who can pass an open examination conducted in both official languages. That would make it possible, I believe, for any young Canadian to get a university education who could qualify for it on the basis of this kind of competitive examination, and it would surely ensure that no young Canadian would be prevented from so doing because of a lack of funds.
I admit this will be an expensive scheme to put into effect. If it were put into full effect with the students studying at universities for four years it would require $25 million in assistance each year. This would be done by competitions conducted by the university association and so on. We have also proposed interest-free loans from the first university year until one year after graduation, which would constitute a revolving fund from which students could benefit, from

the interest which would begin one year after they left college. I think it would be advisable for a scheme of this kind not to be restricted to Canadians who have just left school. It also could become a most important part of our adult education.
I believe this proposal should commend itself at least to the Secretary of State for External Affairs, because in concluding my remarks I refer to what he said in March, 1958. This will also show that while we welcome this item because it increases the grant, it does not implement the promises made in the election campaign by the Secretary of State for External Affairs, presumably speaking for the government. On March 4, 1958, as reported in the Halifax Chronicle-Herald he outlined a stepped-up program of assistance comprising the following three points: urgent increase in fellowships, bursaries and scholarships. That is something I have mentioned. Next, that federal government grants to universities be increased from $1 to $1.50 per head and that is being done, and that the distribution should be based on a national average. Finally, and this is important, a possible amendment to the federal housing act to allow financial assistance to universities for residential construction which could be repaid on a self-liquidating basis.
My hon. friend probably knows that this latter point is one of the most important problems facing the universities in their capital construction program, and if the National Housing Act could be used in this way it would be a great help to them.
The Secretary of State for External Affairs repeated these proposals in Vancouver on March 22, and on that date the press quoted him as saying also that these proposals were for 1958-59. The report goes on to say that when the minister made them on this date he was cheered by more than 1,000 students. He might well have been cheered, because he said that the grants would be $1.50 per head of population instead of $1, and that there would be $6,250,000 to finance 10,000 new scholarships, bursaries and fellowships in 1958-59, eventually increasing to $25 million for 40,000 scholarships.
These were the proposals he brought forward three weeks before the election. He also promised amendments to the National Housing Act, which I have mentioned, and as a member of a government with a great interest in higher education he put forward this program as something which would be implemented in 1958-59. This is not being done. We welcome however this increase of 50 cents in the amount of the grant, and we will be very glad indeed to support it.


Herbert Wilfred Herridge: 
Mr. McWilliam:: Mr. Chairman, the remarks made by the leader of our party have set out this party's attitude on grants in aid to universities and the proposed increase. My hon. friend also made certain suggestions with regard to further aid.
The present formula, including this year's increase, will grant up to approximately $725 per student in some provinces. In other provinces the amount will be as low as $220 This is a most inequitable formula, particularly as it affects the provinces of Nova Scotia and New Brunswick, as the hon. member for Algoma East has pointed out.
My remarks will deal with the service rendered by the small universities and their financial plight, and the group of high school students whose standards would enable them to continue their education but who are unable to do so for financial reasons. The further supplementary estimates contain an item in the amount of $8.5 million covering a 50 per cent increase in the amounts of the grants in aid, bringing the total amount paid to $25,600,000 based on the rate of $1.50 per head of population.
This increase is a most welcome and badly needed one, and meets half way the request made by the national conference of Canadian universities. This 50 per cent increase is a substantial one in the light of present revenues, and it will provide further financial assistance which will pay big dividends in the years ahead. The number of eligible Canadian universities is 91. However, seven of these are in Quebec province, which reduces the number that will receive grants this year to 84.
In New Brunswick and Nova Scotia there are 19 eligible universities as compared with 10 in the provinces of British Columbia and

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Alberta and three in Prince Edward Island and Newfoundland. Ontario has a total of 30. New Brunswick and Nova Scotia together have as many institutions eligible for grants in aid as have British Columbia, Alberta, Manitoba and Newfoundland combined, despite a much smaller population. New Brunswick has more eligible universities than either British Columbia or Alberta, while Nova Scotia ranks third behind Ontario and Saskatchewan.
In April of this year the national conference of Canadian universities submitted a four-clause brief to the government. The clauses read as follows:
(1)	To double the federal grants In aid to universities of Canada.
(2)	To agree to some modification of the present formula of these grants to make the rates between one university and another more equal.
(3)	To provide financial help towards capital expenditures for departments in the physical and biological sciences.
(4)	To provide greater federal support for fundamental scientific research and for graduate studies within universities.
The request contained in clause 2 of the brief asks for a modification of the present formula toward making the rates between one university and another more equal, but apparently no action in this regard is contemplated this year. I take it from the minister's recent answer to a question I asked him on orders of the day, when he stated that no change was contemplated, that this is the case. His answer was just a "no", but I imagine that reply would not go beyond the present year and that there may be changes in the future.
In summary, the brief states that the present system shows weaknessess in that universities in some provinces receive far less per student than those in other provinces. The rates in New Brunswick and Nova Scotia are among the lowest, the top rate per student being $481 and the lowest $148. The summary also states that there is failure to make any provision for the wide differences in the cost of educating students in the various disciplines. While the increase in grants rises annually in accordance with the increase in student enrolment, in 1956-57 the average grant per student was $221 and in 1957-58 it was $205, a difference amounting to $16 less per student.
The opinion has been expressed that this submission favours the larger universities. I refer, of course, to the submission of the national conference of Canadian universities. In my opinion it would be a serious mistake to increase the per student grant to large universities at the expense of the smaller institutions. Most of the larger universities are endowed and many of them receive grants
[Mr. McWilliam.l
from provincial governments; their tuition fees are higher and their large enrolments qualify them for the major portion of the grant.
On the other hand the small universities which are not endowed are continually facing critical financial problems which retard expansion and in many cases are in difficulties in meeting current expenses. The present level of federal grants in aid in many cases are the difference between carrying on and closing the doors.
In the provinces of New Brunswick and Nova Scotia where there is a proportionally large number of universities, the majority, like most Atlantic province institutions, are in the small university group. The smaller universities enrol students who in many cases cannot afford to go to a larger university. In this respect these institutions are performing a great service to Canada in providing higher education for a group who otherwise would be denied the opportunity. While the present percentage of qualified students attending universities is low, being only 7 per cent out of a possible 31 per cent, it would be much lower if small universities were not offering the opportunity. Increased grants make it possible for small universities to carry on and extend the opportunity for a larger enrolment among the group with limited financial means, which comprises practically all students in the group between the 7 per cent now attending and the 31 per cent eligible.
The government should give every consideration toward making it possible for the group who have the academic qualifications but who lack the financial aid to continue their education thus providing equality of opportunity. I wish to take this opportunity to publicly express, once again, the gratitude of the people of New Brunswick to one who has done more than any other single person in assisting young men and young women to acquire a higher education. I speak of that great benefactor, Lord Beaverbrook.
Any submission to the government to change the formula of payments should be given the most serious consideration, keeping in mind the financial plight of the small universities, and in particular the group they serve. If any change is made in the formula of payments the quota for small universities should be increased to bring about an equality of opportunity.


Donald Methuen Fleming: Mr. Chairman, just one word. I thank the Leader of the Opposition and other hon. members who speaking for themselves and their parties have commended this proposed increase represented by the present item. I believe I should make

one comment on the matter that has been raised. It has to do with the formula for division of the provincial allotment among the universities or institutions of higher learning in the provinces.
It is quite true the present formula which we have inherited from the agreement of March, 1957 and which was in effect indeed since the grants were first instituted in the fiscal year 1951-52, has created wide disparities in the amounts allotted per student by reason of the fact that the proportion of population in attendance at institutions of higher learning varies so widely from province to province. The Leader of the Opposition referred to Nova Scotia. Under the present formula Nova Scotia receives the lowest per student award. On the other hand, under the existing formula Newfoundland receives by far the highest. For the year 1957-58 the distribution ran all the way from a low of $148 per student enrolled in Nova Scotia to a high of $421 per student enrolled in Newfoundland.
This matter has been studied, and as the hon. member for Northumberland-Miramichi mentioned it was the subject of representations made on behalf of the governing body of the national conference of Canadian universities to the government when they met the Prime Minister and myself several months ago.
This has been a troublesome and difficult matter. No one wishes to see these wide differences. However, in seeking to bring about a greater measure of equality on a per student basis very serious difficulties are encountered because of the difference in educational forms in each of the provinces, and the difference in definitions of "institutions of higher learning" in the various provinces. It is because of the wide difference that exists attributable to differences in provincial approach that it has not yet been found possible to devise a formula which will maintain general justice as among the different provinces with a greater measure of equality in the allotment per student.


[Stage Direction]
Item agreed to.
The Deputy Chairman:: That completes the estimates of the Department of Finance.



DEPARTMENT OF NORTHERN AFFAIRS AND NATIONAL RESOURCES

[Stage Direction]
670. To provide for contributions to the provinces, pursuant to agreements entered into or to be entered into, with the approval of the governor in council, by Canada with the provinces, of amounts equal to one-half of the amounts confirmed by the provinces as having been spent by them for campground and picnic area developments-further amount required, $1,500,000.
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John Whitney Pickersgill: Mr. Chairman, there are a couple of points I wish to bring up very briefly, and these relate to matters that were under consideration at the time the minister's regular estimates were before the committee and on which we did not have information because at that time the minister had not been able to supply it to us. It related to two employees in the Cape Breton highlands national park, and I should like to read the question and answer as given by the minister as recorded at page 4516 of Hansard. It will be recalled that I had a starred question on the order paper for about two months which was finally answered by the minister on Wednesday last, though I had asked for an answer before the minister's regular estimates were before us.


Mr. Hamilton (Qu'Appelle):: What has that to do with this item?


John Whitney Pickersgill: Does the minister wish to raise a point of order?


Francis Alvin George Hamilton: What has that to do with this item? I was asking you.


John Whitney Pickersgill: If the minister wishes to raise a point of order about this, Mr. Chairman, I must confess this matter has nothing whatever to do with the particular item now before us. These are unfinished matters we were considering, and they are unfinished through no fault of our own because we were seeking information from the minister which he could not give us at the time his estimates were before us, although I am not criticizing him for that. I am bringing this matter up now solely because I thought it would be much more convenient to the house if I brought it up in committee of supply when the minister could perhaps dispel some of my misgivings and shorten the whole proceedings. If the minister insists on his point of order, I will not have the right to bring it up here and I shall be forced to bring it up on the second reading of the appropriation bill. From the point of view of getting through the business quickly, I think it might be much better to exercise a little latitude and dispose of it here, but I am in the hands of the committee. Does the minister want me to go ahead?


Francis Alvin George Hamilton: I think it is up to the chairman.


Charles Edward Rea: Unless someone raises a point of order the chair is quite willing.


John Whitney Pickersgill: In that case I shall proceed. I am not going to raise the point of order! When the minister quite properly intervened I was beginning to read the questions I had

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asked and the answers the minister gave, as found on page 4516 of Hansard for September 3. The first question was:
Were George P. LeBlanc and Alex P. Boudreau dismissed from the Cape Breton highlands national park effective June 10, 1958?
The answer given by the minister to that question was:
Mr. Speaker, the answer to the first question is yes.
The second question was:
How long had each of these employees been employed by the national park?
The answer to that question was as follows:
George P. LeBlanc was continuously employed from April, 1951, to the date of his dismissal. Alex P. Boudreau was originally taken on strength on October 6, 1954. Mr. Boudreau was struck off strength on February 14, 1955 and was again taken on strength on May 11, 1955. He was continuously employed from that date to the date of his dismissal.
The third question was:
What was the reason for dismissal in each case?
The answer was:
The answer to question No. 3 is that the dismissal in each case was made on the basis of a declaration by an hon. member that the employee had taken an active part in politics.
I have here, sir, a telegram which I received on September 4, the day following the minister's answer, which reads as follows:
J. W. Pickersgill, M.P.,
House of Commons,
Ottawa, Ont.
Population of North Inverness flabbergasted at declaration Hamilton re George LeBlanc and Alex Boudreau. Five thousand people can swear these two were never active in politics apart from going out to vote. Press for immediate investigation.
Simon P. Boudreau.
I also have a copy of a letter sent to the hon. member for Laurier purporting to have been addressed-I must not say anything I cannot prove-to the minister on June 16, 1958 from Cheticamp, Inverness county, Nova Scotia. It reads as follows:
Hon. Alvin S. Hamilton,
House of Commons,
Ottawa, Ont.
Honourable and dear sir:
We were somewhat surprised at your recent statement in the House of Commons to the effect that no employee of the federal government had been dismissed for reasons of political affiliation.
We, the undersigned, George P. LeBlanc and Alex P. Boudreau, have been employed as carpenters by the department of northern affairs in the Cape Breton highlands national park for seven years and three years respectively. Our work has always been highly satisfactory as can be ascertained by contacting Mr. Atkinson, the recently transferred park superintendent.
On June 10 we were notified that our services would no longer be required. Upon being asked

the reason for our dismissal the new park superintendent, Mr. Brown, produced the following letter:
Definite allegations of participation in political activity have been made against the following three employees who are employed in the Cheticamp side of the park in seasonal positions. These are Alex P. Boudreau, George P. LeBlanc and Peter H. Poirier. These men should be released immediately and replacements obtained on the advice and recommendations of the local adviser.
There is a query over the signature because apparently they could not read it but they have taken it to be "B. M. Strong". I am not altogether surprised that they could not read the signature. The letter continues:
If getting out to vote on election day is considered being engaged in political activities, then we must of course plead guilty. However, we were not aware that federal government employees had as yet been deprived of their right to vote. As to other political activities, we are prepared to swear that neither of us, while employed by the federal government has ever given publicly any indication as to which side he was on. Our only guilt would seem to stem from the fact that we were appointed by a Liberal administration. Furthermore, we are prepared to provide you with a sworn statement bearing the signatures of 500 people in this community to the effect that nobody really knows which way we voted in the last election.
I would hope that would be true.
A dismissal of this type is a black mark against our reputation which we are not prepared to ignore. Unless your department acts immediately to erase it, we shall be forced to have recourse to legal means.
Yours very truly,
George P. LeBlanc, Alex P. Boudreau.
The minister stated in reply to my question -I want to be very exact-"the dismissal in each case was made on the basis of a declaration by an hon. member that the employee had taken an active part in politics." I am not going to repeat now what the hon. member for Laurier said earlier in the session, but he indicated the historic reasons for permitting dismissals in this fashion, a procedure,
I may say, which I, like the hon. member for Laurier, think is antiquated and should be discontinued, no matter who is in office. People should not be dismissed on the simple declaration of a member of parliament that he knows these persons to have been engaged in political activities.
The hon. member for Laurier read a lot of authorities, Sir Robert Borden, Mr. Meighen, Mr. Mackenzie King and a good many others, to the effect that the reason a declaration by a member of parliament was accepted and a declaration by anyone else was not accepted was that such a declaration could be debated right here in parliament in the face of the accuser. The minister did not tell us what member of parliament it was who made this

declaration. It does seem to me that the very least the minister could do in this case is to tell us what member made this written declaration, because it has to be a written declaration, and table it in the house so that every hon. member will have the opportunity to see it, so that we, who are responsible to all the taxpayers of Canada for the way in which public moneys are expended, will have the full and proper opportunity to see what in fact the situation is that is alleged by the hon. member and so that he, whoever he may be, will have the opportunity to defend his conduct.
I agree with what was said the other evening by the hon. member for Assiniboia. I agree completely that this procedure is something that belongs to another age. I do not care whether it was done by Liberals or Conservatives. I do not think it should be done any longer. I have no hesitation in saying that and I have no hesitation in adding that I was not aware of this practice during the time I have been a member of parliament until after June 10, 1957.


Mr. Cardiff:: Would you like a few concrete examples of what took place?


John Whitney Pickersgill: No, I am not particularly interested. Of course, if the hon. gentleman wants to make one of his rare speeches I would be very glad to let him do so, and I would not care whether it was done by Liberals or Conservatives. I do not say that the practice is necessarily wrong but I say that it is an antiquated practice.


Lewis Elston Cardiff: You would think that nobody but the Conservatives ever did it.


John Whitney Pickersgill: I did not say that nobody ever did it but the Conservatives. The hon. gentleman was not listening.


Lewis Elston Cardiff: Oh yes, I was.


John Whitney Pickersgill: I said it was done in the past.


Lewis Elston Cardiff: You are making a big fuss over nothing. You are taking a lot of time on a lot of things that do not amount to anything.


John Whitney Pickersgill: The hon. gentleman's interventions are always, of course, of an exceptionally high order, Mr. Chairman. Only yesterday we heard eloquent speeches from the Prime Minister, the Leader of the Opposition and the leader of the C.C.F. party about human rights, and yet today the chief whip of the government says that the dismissal of two men because of accusations we have not seen in this parliament is a matter of no consequence.


Lewis Elston Cardiff: I did not say any such thing.
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John Whitney Pickersgill: Well, a small matter.


Lewis Elston Cardiff: I did not say any such thing.


John Whitney Pickersgill: I am not going to misrepresent the hon. gentleman, but the record will speak for itself.


Lewis Elston Cardiff: I just asked a simple question, and you would not answer it.


John Whitney Pickersgill: If the hon. gentleman will repeat his question, I will answer it.


Lewis Elston Cardiff: Go on with your speech.


John Whitney Pickersgill: I want to repeat that I am not seeking to condemn any previous governments or any previous politicians, but I think this is the type of practice about which I should like to see the Prime Minister or anyone else undertake a reform. I should like to see investigations of these charges of political activity conducted by some impartial person. So far as I am concerned, I hope I never belong to a government in the future that carries on this practice. There may be many hon. members who think that is not a very serious thing for me to say because my political prospects are not very good.
However, I am serious about this matter, and I do not want to be diverted from the point. The point is that the minister allowed two employees to be fired from a national park, on his own statement, because some unnamed hon. member in this house made accusations. We know nothing about them, and again I say I believe we in this house are entitled to have that information so that we can form a judgment as to whether or not that was justified. These people say it was not. I am not taking their part. I have never seen these men in my life. I do not know anything whatever about them, except what I have before me here.
This is not an isolated case, of course. The minister has had other instances, and I want to say something about another one about which the minister did not bring down a return until just after his estimates were through. Before that, however, I have another letter here signed by Thomas Williams and William Asseff of Smelt Brook, Victoria county, Cape Breton. This was written on August 28, and it reads:
I know you are not the member for Victoria-Cape Breton North-but I am writing this letter to you to see if you can help us to get our jobs back on the Cape Breton Highlands national park.
I, Thomas Williams, of Smelt Brook, and William Asseff of South Harbour, Victoria county, were laid off our jobs on the 26th of August at 12 o'clock. There were two more men hired in our position that were on another job at the launchway at Smelt Brook.
Peter A. Macintosh went to work on the launchway on the 26th of August and was hired on the park on the same day. Mr. Ernest Briand who was sub-foreman on the launchway was given one or

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two weeks to have someone placed as foreman so he could work with the national parks.
I ask you, sir, is this a fair way for a free Canadian to be treated or are we going to have the privilege of a free vote taken away from us.
I ask then why, when there's no complaints in the superintendent's office, were we laid off our jobs and two more men hired in our place. I ask, Mr. Member, will you ask this in parliament and send me the answers?


John George Diefenbaker: Is that the entire letter?


John Whitney Pickersgill: That is the entire letter, and I would be glad to send it to the Prime Minister.


John George Diefenbaker: No.


John Whitney Pickersgill: I have never been one to read parts of a document.


John George Diefenbaker: No, but you read so fast at the end.


John Whitney Pickersgill: I know that hon. members want to get through, and I am trying to accommodate them. I apologize also for my voice. It needs a rest.
I want to go to another case, and this is a case which was discussed on the minister's estimates on the last evening they were before the house. He told me I would find the answers to my questions, which he did not answer-I should not say he refused to answer them, except by remaining in his seat-when this return was brought down. It was a return to a motion made by the hon. member for Ottawa West and it related to the dismissal, as I put it, or the failure to re-engage, as the minister put it at one point though he changed his ground as he went along, of a certain Mrs. A. E. Woodman of Jasper.
I have here this return and the first letter on this file is a letter to the superintendent of the national park from Mrs. Woodman, which is dated January 6. I will only read the text of the letter, and not the names, but I shall read the full text.
Having been an attendant at the Jasper information bureau for several summers, perhaps a formal application is not necessary. However, just for the record, I shall be available for service on June 1st, 1958 or earlier if required.
To this, Mrs. Woodman received the following reply dated January 21:
Thank you for your letter of January 6th making application for employment at the Jasper information bureau this summer.
We will be pleased to have you back again at the bureau this year and you will be contacted at a later date as to when your duties will commence.
That is the whole letter. Then, on June 2, and this is the next letter on the file, there is a letter addressed to Mr. Strong, chief of the national parks service, Norlite building, Ottawa. It reads:
For the past four years I have been on the summer staff at the information bureau here. This year

I applied and was accepted quite early in the year. Yesterday Mr. Pettis informed me that, in a letter from Dr. Horner, M.P. for Jasper-Edson, he received orders to discharge me because my name was associated with the Liberal party. Dr. Horner told him who was to replace me. Will you give this matter your attention, please, it is now too late for me to secure other summer work; my husband is a world war I veteran and we live on a small C.N.R. pension-he was refused work this year too but no reason given. Are we living in a Gestapo age? An early reply will be appreciated.
Then, on June 9, Mrs. Woodman wrote the minister in the following terms:
May I ask for your consideration? I Shall be as brief as possible.
Are you aware that patronage has reared its ugly head in Jasper national park?
I am not a civil servant but for the past four years I have given satisfactory service as an attendant in the information bureau here.
This year I applied for the same position early in the year and was given a letter of acceptance. On June 2, 1 was informed that Dr. Horner, M.P. for Jasper-Edson had objected to me being given employment as I was an active member of the Liberal organization in Jasper.
Mr. Pettis gave me a letter which stated-[DOT]
Perhaps I do not need to read that again because I read it. Then the letter goes on:
I understand Mr. Pettis' position-
Perhaps I should read that because I am breaking the continuity.
Mr. Pettis gave me a letter which stated, "I have been instructed by my head office in Ottawa to withdraw our offer of employment to you in the Jasper information bureau for the forthcoming season". I understand Mr. Pettis' position but this letter gives a wrong impression-I was never "offered" employment in the bureau, I applied in writing and was accepted in writing; I was informed that my work would start June 14, 1958- therefore I was discharged, most unfairly, too late in the season to secure another employment.
My husband is a veteran of world war I and we live on a small C.N.R. pension: he applied for the attendant's job at the park west gate but he was not given work of any kind-why? We can only assume that he too is being penalized for my political associations.
We have lived in Jasper for sixteen years and I feel sure, Mr. Hamilton, that you and other members of the cabinet believe in justice and a square deal for every "fellow Canadian" of Mr. Diefen-baker's.
Will you investigate this matter of my discharge from the service? I will appreciate hearing from you.
To this, the minister replied on June 14 in the following terms:
I wish to acknowledge and thank you for your letter of June 9th.
It has been government policy for many years to discharge or not employ people who have actively participated politically. By your own admission you state in your letter, "We can only assume that he too is being punished for my political associations." Under the circumstances, I have no choice in the matter but to concur with the action taken by my departmental officials.
Then there is another letter here of June 19 to Mr. Pettis from Mrs. Woodman which

I do not think I will read because it talks about getting legal advice and so on. Then there are several letters from the Liberal candidates to which reference was made by the minister. I am not going to take any more time to read this file because it is, of course, the property of the house and is available to everyone to read. After I had raised this matter in the house I received a letter from Mrs. Woodman whom I have never met and whom I do not know at all, on August 19 in the following terms:
Dear Mr. Pickersgill:
Thank you for bringing my ease out in the open and insisting on an admission from Mr. Hamilton that I was hired and then "told later not to report".
I am sending you copies of my letters from the Department of Northern Affairs and National Resources, including my acceptance for work at the information bureau and my discharge, written in such a way that it gives the impression that an offer of work had just casually been withdrawn: nothing could be more wrong-I was never "offered" work-I asked for it and was discharged just twelve days before I expected to begin work, too late to get other full time summer employment here.
The enclosed copy of a letter from Dr. Hugh Horner, M.P. for Jasper-Edson, is a masterpiece of contradiction, it was not marked "confidential" so I do not hesitate to pass it on to you to be used as you see fit.
I have been a member of the Liberal party all my "voting" life and I just hope I am still around to do my small bit when the next election comes around.
Thank you again for your support.


Some hon. Members:: Oh, oh.


John Whitney Pickersgill: Here is a letter that I have already read into the record from Mr. Pettis the superintendent to Mrs. Woodman. Then here is the letter to Mrs. Woodman that purports to be from the hon. member for Acadia, and I say "purports to be" because I have only received this from the lady herself and have not, of course, been able to verify it in any way. But the hon. gentleman is a member of this house and if he wishes to deny the letter he has the right to do so. The letter reads as follows:
Ottawa, June 9, 1958.
Mrs. A. E. Woodman,
Jasper, Alberta.
Dear Mrs. Woodman:
The Prime Minister has requested that I reply to your letter of June 2nd-
This astonished me and I put a motion on the order paper asking for the correspondence between Mrs. Woodman and the Prime Minister and the Prime Minister offered no objection to the motion which was passed. But I inquired this morning and the correspondence had not yet been tabled. I am not seeking to make anything of that fact at all. I know what preoccupations there have been. The rest of the letter follows:
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The Prime Minister has requested that I reply to your letter of June 2nd, which was addressed to him with regard to the position on the tourist information bureau at Jasper.
When asked for recommendations to fill these positions I found that I could not accept your name because of your political activity. For the record I would like it to be known that the Conservative party do not intend to practice patronage as the old Liberal regime did.
I think there is a beautiful irony there.


Some hon. Members:: Oh, oh.


John Whitney Pickersgill: I continue:
We feel that a person's politics should not be of any influence in being accepted for any position. However, the general rule is that any employee of the government, civil servant or otherwise, should not take part in any political activity.
Yours sincerely,
Hugh M. Horner, M.D., M.P.
That is the whole of that letter. What I want to say is this. This lady was not employed by the government at the time of the general election. It is true that she had applied for a position and had been told that in June a casual position, a summer seasonal position, would be hers. She was a free citizen, not an employee of the government all during the election campaign. She surely had a right, if she wanted to, to engage in political activities just as any other free citizen has. The day when free citizens are not going to be allowed to engage in political activity is a day that I am sure neither the Prime Minister nor the minister on reflection wants to see happen here. If it is going to be said that no one is to be employed subsequently in the public service because he has engaged in political activity, there are a great many employees who would never be engaged in the public service. It seems to me to be an absolutely preposterous suggestion to say that because someone has been active politically and subsequently applies for a position, that should make any difference whatsoever in that position.
I quite agree with the view that a public servant, while a public servant, should not engage in political activity. I do not agree with the view that is expressed by some parties that they should. But the idea that people should be penalized because when they were not public servants they engaged in political activity seems to me to be wholly preposterous. Before we grant any more money to the minister I think we are entitled to have from him an explanation of these two cases.
I admit he has had no notice here of this other case. I would not want to press that one because I admit that the minister has not heard of it before. I do not want to be

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unfair. But of these two cases the minister has had ample warning and ample knowledge, namely the cases of these two gentlemen George Leblanc and Alexander Boudreau in the Cape Breton Highlands park. I think we should have the declaration of the member of parliament who is responsible for this laid before us and read into the record so that we know what we are talking about. In the case of Mrs. Woodman I think we should hear from the minister what justification he thinks there is for penalizing people because at a time when they were not public servants they engaged in political activity.


Hazen Robert Argue: As my name has already been mentioned in this discussion, I want to say that I am indeed shocked by the practice that apparently is being followed. I do not think members of parliament should be given the right or the responsibility of informing on public employees and recommending that they be dismissed and that the government should subsequently take that recommendation as full reason for dismissing such an employee. Surely it is part of the fundamental right of every Canadian, if he is to be dismissed from a position, to know why he has been dismissed and he should have some recourse of appeal. Members of parliament should not be given this right to jettison the economic position of Canadians and to interfere in their personal right of employment if they are giving good service.
The hon. member for Bonavista-Twillin-gate at one point in his remarks said that he would not say that what has been done is wrong but he would say that it is antiquated. I am quite prepared to say that it is wrong. Not only is it antiquated but it is wrong. It is wrong on moral grounds. It is wrong from the standpoint of efficient government administration. It can do nothing but undermine the morale of public employees. If this practice is carried on of a member of parliament informing the minister and having people fired, it makes a mockery out of any other move by this parliament by way of a bill of rights. If parliament is sincere- and I believe it is-in wanting a bill of rights to guarantee human freedoms, then the practice of this government in this regard strikes at the very foundation of human freedoms in this country.
I can tell the government that if they continue this practice and if individual members of parliament on the government side of the house accept this as a prerogative and exercise it they will be hounded by members of the opposition in this house, session in and session out, because this is a matter of great importance to the welfare and to the
[Mr. Plckersgill.l
freedom of the people of Canada, and we are not going to take this kind of interference with human freedoms without a continuous and energetic protest.


John Whitney Pickersgill: Is the minister not going to
reply?


Francis Alvin George Hamilton: I think it is only fair to the house to repeat some of the statements and allegations which have been made here today. I think anyone who knows the political history of the last 25 or 30 years will look on this change of government after 22 years of one administration as one of the greatest steps forward in the improvement of the treatment of casual workers for the government which has ever taken place in the history of any democratic country.


Some hon. Members:: Hear, hear.


Francis Alvin George Hamilton: This matter, as admitted by the hon. member for Bona-vista-Twillingate who raised it, is completely out of order. He took advantage of the situation which had been fully discussed in the estimates when they were before the house, and in the interest of getting things accomplished we made no objection, but I would just like to put the whole thing in perspective. Many hon. members recall with personal interest the things which happened in Saskatchewan in 1934 when the government changed in that province; many of us remember with personal interest when the federal government changed in 1935 and when at these various parks and institutions where the government employed casual help, not just one here and two there but the whole outfit was dismissed out of hand.


An hon. Member:: Remember Ontario in 1935.


Francis Alvin George Hamilton: And there are hon. members in this house who had members of their families who lost their jobs. When you think of the thousands of employees in the national parks and the northern affairs department and particularly the number employed as casual labourers, and especially remembering that the hon. member after searching up and down this country from one end to the other can come up only with two cases in Cape Breton, one case in Jasper, this new case of which I do not know and one, or is it two, other cases in some other place-at any rate just a few cases-I think it is a matter of a tribute which should be paid to this government. I say this especially in view of the fact that if we had adopted the attitude with respect to casual labourers which was taken by the previous administration, there would have been no

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delay after last June; there would have do not know this lady, she was employed been a 100 per cent change.	by the parks department during the general
To my knowledge there was almost no election and before, and it was all right when change made in the employees of the na- she was working for the Liberal government tional parks after last June. We kept all to take part in that sort of activity, but when those appointees, casual employees as they a new government comes along she should were, even though traditionally, particularly have enough sense not to go out and actively in the eastern areas, there would have been oppose the then government in the current a complete change-over. When the winter election. One could not blame the sitting work program started last winter those same member for recommending her dismissal in men, not appointed by this government, were that case, and I asked him some pointblank kept on to do their work.	questions in this regard.


An hon. Member:: What about these cases?


Francis Alvin George Hamilton: The appreciation of what we have done is well known in some of these areas. I have also intimated in this house that in some cases instead of using the traditional methods of hiring people, members of parliament have asked members of the churches of both principal faiths in this country to recommend persons to the superintendent who most need this casual labour.
These things in the minds of the people of Canada will, X think, indicate as clearly as anything that this government has taken a tremendous step forward. We have a new profession of faith on the part of the hon. member for Bonavista-Twillingate who sat in the closet working for the previous administration for many years, advising them at the highest level, and then took his place as a minister of the crown, but not once did he stand on his feet in this house and make a declaration the like of which he made today-


An hon. Member:: Judas.


Francis Alvin George Hamilton: The government has gone forward and I know investigations are being carried out in accordance with the policies laid down in the various departments and because of some of these investigations delays have occurred.
The Woodman case was discussed on my estimates and I do not think the hon. member for Bonavista-Twillingate was quite right in bringing it forward at this time, because he did not give the facts which were disclosed.


John Whitney Pickersgill: If the minister will permit me to say so, the only reason I brought it up again was that the report had not been tabled and I did not previously have the information.


Francis Alvin George Hamilton: I am not going to debate that little point but I would just like to point out to the committee that the Woodman case concerned a woman who had been actively political whether at the time of her dismissal or not. If we just let our minds go back, and of course hon. members


John Whitney Pickersgill: Could I ask a purely factual question? The minister said she was employed during the June election, but she was to report for work on June 14, 1958 according to the return, and the election of 1957 was on June 10. Is the minister stating as a fact she was employed before June 10, 1957, or is that merely a supposition?


Francis Alvin George Hamilton: The hon. member knows I have not the file before me but it is true she was employed for the previous four or five years in the reception booth of the park and in June she certainly would be on duty. I think, therefore, the member was wrong in bringing up this matter on this vote, which has nothing to do with it and he has not achieved the purpose which he would like to have achieved. You cannot make the people of Canada swallow this idea that now the Liberals are in opposition they have suddenly changed their spots and have become as virtuous as the hon. member for Bonavista-Twillingate would lead us to believe.
This government by its actions has alleviated the problems of the civil servants and has raised the civil service level and that of the casual workers of the government to a new high, and I would say that I hope this will be the end of the subject.


John Whitney Pickersgill: Will the minister give us the name of the member on whose recommendation the action was taken in the Cape Breton Highlands case?


Francis Alvin George Hamilton: Yes, that hon. member was the member for Inverness-Richmond.


Mr. Grills:: I have been listening with considerable interest and amusement to the hon. member for Bonavista-Twillingate in his remarks about political patronage. He mentioned two people who asked him to reinstate them, and I would inform him that dozens of people in Hastings South have asked me to get them reinstated in jobs they lost in 1935. They were fired in 1935 without a trial and without any consideration, and they now want to get their jobs back which were lost during a Liberal regime. I think he has made an error today because his party were past

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masters in this sort of thing. As far as the hon. member for Assiniboia is concerned, he has no sins to answer for as he has never had the opportunity.


[Stage Direction]
Item agreed to.
DEPARTMENT OF AGRICULTURE Terminable services-
663. To provide for payments to western grain producers of $1 per acre up to a maximum of 200 acres per farm in accordance with regulations of the governor in council, $40,000,000.
Hon. D. S. Harkness (Minister of Agriculture):: Mr. Chairman, I seem to detect some eagerness on the part of some hon. members to speak on this item which is to provide the money to make these payments of $1 an acre to western farmers up to $200 per farm.
The Prime Minister made a detailed statement on this matter a week ago today in which he made reference to the long term farm program on which we are engaged. He pointed to the part which this particular proposal is intended to play, and he also discussed the scheme itself in some detail. For these reasons I do not think I should take up the time of the committee for too long in speaking on the matter today.
However, I should like to say that the government gave very long and detailed consideration to the problems of western grain producers. The western members of parliament in this party-and they constitute all the hon. members concerned except one- were consulted on numerous occasions with regard to this question and they gave us very valuable advice in connection with it.
The so-called deficiency payments which were asked for by the western wheat pools and by other western farm organizations were considered very thoroughly. I say "so-called deficiency payments" and I would just like to say a word on that. These requests made by the wheat pools and other western organizations were not, strictly speaking, for deficiency payments at all. I am sorry about the confusion that exists over the term "deficiency payments". A deficiency payment is one which is made to make up the price to a certain predetermined level if the price falls below that level. This is one of the three methods used under the Agricultural Prices Stabilization Act in order to put floor prices into effect. As I say, the request was not for a deficiency payment of this sort but for the fixed payment of so much a bushel on the two previous past crops.


Hazen Robert Argue: Would the minister say whether or not the proposition of the wheat pools was based on a formula and, if so, how this formula was arrived at, because my understanding is that they had a definite formula.


Douglas Scott Harkness: That is correct, but it has nothing to do with the point I am making now, that it was not a request for deficiency payments. What I am trying to do is to clear up the confusion that exists over the term.


Joseph Pierre Albert Sévigny: It would be appreciated by the Chair if members kept their voices a little lower. There is far too much noise in the committee at the present moment.


Douglas Scott Harkness: As I said, the request of the western farm organizations for this payment was very carefully studied and it presented two very grave disadvantages. First of all, under payments of the kind requested, the people who would receive the largest benefits would be the largest producers, and the people who would get the smallest benefit would be those who needed help most, that is, the smaller producers. In addition, those who were hailed out or who lost their crops by any other means would receive no payment at all under the so-called deficiency payments requested, and people who had fed the major portion of their grain to livestock would similarly receive no payment. Those are very serious disadvantages. It would not make for a fair distribution, and it would not give the major portion of the money to the people who needed it most.
A second serious disadvantage is that if this payment had been put into effect with respect to oats and barley there is no question but that the United States would have reacted in one of two ways. Either that country would have placed an embargo against the entry of Canadian oats and barley into the United States or it would have been required by its own customs act to place against Canadian oats and barley a countervailing duty equivalent to the amount of the deficiency payments. Thus we would have been no better off than before. In fact, we would have been much worse off. That situation is one which made payments of the sort requested highly undesirable; it was the type of thing which would actually have done the Canadian western economy more harm than good.
The plan of acreage payments which we propose under this item is the best method, I think, which could possibly have been devised to meet the cash difficulty which it is admitted exists in western Canada is due to two short crops, a short crop this year and a short crop last year. I think it must be borne in mind that farmers, and grain farmers in particular, depend on two things: the size of the crop produced and the price received per bushel. During this year and last year the number of bushels produced have been considerably reduced and income has therefore been reduced, even though the

price was similar to that of previous years. In fact, the price is down a little, too. But 1 think we must always keep in mind that the most important determining factor is the size of the crop. It is much better, for example, to have a 40-bushel crop and get $1 a bushel than to have a 10-bushel crop and to get $2 a bushel for it.
As a result of short crops the small farmers particularly in western Canada have had very little grain to deliver. The acreage payment which we propose to put in effect will give most assistance to these small farmers who need assistance most at the present time. In commenting on the statement made by the Prime Minister, the only criticism made by the Leader of the Opposition with regard to this scheme was, really, that it was not based on any formula or principle. This is not the case. The principle upon which these payments are based is to extend the greatest amount of assistance to those who need it most, that is, to the small farmers. That is the basic principle underlying this type of payment and, of course, there is a definite formula. The formula is to make payments of $1 an acre up to a maximum of 200 acres in order to accomplish the purpose which I have enunciated in stating the principle of the proposal.
The fact that it will accomplish this purpose can I think be shown by considering the size of farms in western Canada. This is a matter which was raised by the hon. member for Assiniboia, and I will comment on his statement later. As reported in Hansard for October 28, 1957, at page 462 I gave a breakdown of the number of cultivated acres-the size of farms in western Canada as far as cultivated acreage is concerned-and looking at that table we see there are, or were, in that area, 230,854 permit book holders and of these, 31,299 had less than 100 cultivated acres, that is, 13 per cent of the total had less than 100 cultivated acres. The next group are those having between 100 and 199 cultivated acres, and they amount to 63,272 of these farmers, that is, 27 per cent. If you add those two groups together you have 94,571, or over 40 per cent of all the permit book holders among farmers in western Canada who have less than 200 acres in cultivation. You have a large number of others in the next group, 200 to 299 acres. The total amounts to 51,000 people in this category, but a large number of those in this group probably little more than 200 acres in cultivation. As a matter of fact, their average is 246 acres.
Taking these figures altogether I think it becomes clear that this type of payment provides payment on the total acreage in
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cultivation of over 40 per cent of all the farmers in western Canada and provides payment on nearly all up to 50 per cent. That seems to me to be much the fairest way in which assistance could be provided to western farmers and their admitted cash deficiency made up at this time.
The hon. member for Assiniboia in commenting on the statement made by the Prime Minister stated that this payment which was going to be made was less than 10 per cent of what the farm organizations out there had requested. That is a completely incorrect statement and I am surprised at the hon. member for making that remark and another statement with which I shall deal in a moment.


Hazen Robert Argue: It is absolutely true.


Douglas Scott Harkness: The wheat pools requested total payments amounting to $228 million.


Hazen Robert Argue: On one year.


Douglas Scott Harkness: No, covering the two crop years, and the payment being made of course, is very much more than 10 per cent of that.
The hon. member for Assiniboia in complaining about the size of this payment also made the statement that the average cultivated acreage of farms in Saskatchewan exceeded 500 acres, a statement which I questioned at the time and which is completely incorrect. I have before me figures as to the average size of cultivated acreage for western farms. In Manitoba it is 232 acres, in Saskatchewan it is 392 acres and in Alberta it is 299 acres. Those are the average sizes of farms in the three prairie provinces. In other words, the size of the farms out there is much smaller than the average person particularly in eastern Canada always seems to believe and smaller than the hon. member for Assiniboia, who should have known better, stated.
There are one or two other points I should like to make. There were some complaints made in western Canada stirred up particularly by hon. members of the opposition parties that the Agricultural Stabilization Act affected eastern farmers far more than it affected western farmers because western wheat, oats and barley were not included under the act. That is true only to the extent that some people in western Canada specialize in the growing of grain and do not produce livestock, dairy products and so forth. I might point out that the payment being made to those western farmers now will certainly at least balance up the payments made to other farmers under this act from which a number of farmers have received no benefit because they grow nothing except wheat.
In connection with this point, however, I should emphasize that the amount of benefit

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Which accrues from the Agricultural Stabilization Act cannot be measured by the actual amount of money which is being paid out under that act. As an example, take the case of butter. The amount of money we pay out in order to keep the price of butter at its present level bears no relationship whatever to the great benefit that price confers on all of the 69 per cent of Canadian farmers who are engaged in the dairy business. The same thing applies to any other payment made under the Agricultural Stabilization Act or otherwise in order to assist the agricultural industry. The benefits which derive are very much wider than the actual amount of money involved.
In closing I might just say that the money which will be paid out under this scheme will be distributed by the Canadian wheat board on the basis of the cultivated acreage shown in the current permit books for 1958. The Canadian wheat board has the organization, the set-up and facilities and the information to be able to make these payments more efficiently and expeditiously than any other agency.


Lester Bowles Pearson: Mr. Chairman, the minister would, I am sure, be very disappointed if I did not say a few words at this time on this item of his estimates but I will do my best not to detain the committee. There are some things, however, that I feel it is necessary to say in regard to what is involved in this item, not in terms of policy, I suggest-because it does not represent policy-but in terms of short term, short range action, how it will be applied and what it covers. In so far as these payments will help to make up for declining farm income and put in circulation extra dollars where they are sorely needed then they meet our approval and will secure our support.
We have put forward, although not in this house, our own views in connection with agricultural policy. There will be an occasion, if not this session then next session, for us to discuss our views in this house because the Prime Minister last Saturday indicated that in the next session we would hear from the government in regard to long range agricultural policies. Certainly that is not involved in this item today. That is one of the reasons for which we criticized it. Furthermore, this action by the government must be a disappointment to western grain producers in the light of statements that have been made by spokesmen of the present government during recent years. Such a reaction of disappointment is natural and inevitable in view of the policies put forward by the Prime Minister and the Minister of Agriculture when they were in opposition.

The Prime Minister's policy in those days as stated in the House of Commons was to overcome by government action-in so far as it should be done by government action-the cost-price squeeze, to restore to the farmer a fair share of the national income based upon a formula of parity, taking into account the relationship between the cost of production on the one hand and the prices farmers must pay on the other.
Notwithstanding what the Minister of Agriculture has said the payments provided in this item are based on no discernible or rational principle. If there is any principle involved it is only a one based on a grant to be made to people who need it and for short term. There is no principle involved in this item which is of a general application over a period of years. Certainly this grant is not related to cost of production or prices and it is not related to any principle of parity. Indeed, when the Prime Minister referred to this matter a week ago today he did not even mention the idea, the principle of parity although he did in that statement dismiss the principle of deficiency payments and the principle-if it is a principle-of a two-price system.
The references to parity made by the Prime Minister on previous occasions were certainly absent last Saturday and they were absent from the statement made today by the Minister of Agriculture. Instead, we were subjected to some general statements and philosophical observations in the statement made by the Prime Minister concerning the difficulties of agriculture and the necessity of the government doing something about it next session on a long term basis. When I speak about the precise language the Prime Minister used with respect to this matter in the past, I have in mind in particular the words he used in the house on March 12, 1956. As found on page 2021 of Hansard, the present Prime Minister had this to say:
The squeeze which the farmer suffers results from the disparity in the relationship between the prices of farm products and the prices the farmer has to pay. When they are in proper relationship parity is established, and it is parity that the farm organizations across this country are asking for today. Not charity but parity.
Those were the words of the present Prime Minister at that time. I suggest that in the action taken by the government on this occasion the farmers are getting neither charity nor parity. Certainly the Prime Minister made no effort last Saturday to relate his payments to a formula for parity about which he spoke in such feeling terms in the debate to which I have referred. In the speech from which I have just quoted the Prime Minister defined parity and left no doubt in the minds

of those of us who were in the house at that time that the establishment of a system of parity prices would prove a solution to the problem of agriculture. Indeed, as found at page 2026 of Hansard for the same day, the Prime Minister moved an amendment in these words:
That all the words after "that" be struck out and the following be substituted therefor:
"in the opinion of this house consideration should be given by the government to the advisability of introducing during the present session legislation to create a parity of prices for agricultural products at levels to ensure producers a fair price-cost relationship."
That same theme was developed in the election campaign of 1957. I find it necessary at this time to refer only to a few of the Prime Minister's speeches in that campaign. Some of them have already been referred to in the house. According to the Ottawa Journal of May 9, 1957, the Prime Minister told a Brantford audience that the Conservatives if elected will "maintain a flexible price support program to ensure an adequate parity for agricultural producers, based on a fair price-cost relationship". I take it that the prairie farmers were not excluded from that reference. Then, on April 25, 1957, in his opening speech in that campaign the Prime Minister outlined an agricultural policy. I quote from the press statement that was issued:
We will assure the farmer of his fair share of the national income-
"We will assure".
-by maintaining a flexible-and I underline the word "flexible"-
These are the Prime Minister's words.
-price support program to ensure an adequate parity for agricultural producers based on a fair price-cost relationship.
It is fair to conclude from that, of course, that the Prime Minister had the western producer in mind as well as other agricultural producers. Last session the Minister of Agriculture introduced his agricultural stabilization measure and defended it as fulfilling all the election pledges of his party.


Douglas Scott Harkness: And it did.


Lester Bowles Pearson: In the light of what I have just quoted, in the light of the Prime Minister's statement in the house in 1956 when he advocated an agricultural policy based on parity prices, and he defined what parity prices were and I have given the definition, how can the Minister of Agriculture say that the agricultural stabilization measure introduced last session fulfilled all the election pledges of his party? The minister in explaining that legislation, and I refer to Hansard for December 14, 1957, page 2398,
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stated that a guaranteed price could be provided through purchase of the commodity, paying deficiency payments, and other price support payments determined by the governor in council. What has happened to these deficiency payments? On Saturday last the Prime Minister dismissed deficiency payments for western agriculture because they, and I quote from page 4346 of Hansard of this session, "are not in the long run interest of either the western grain producer or the nation as a whole."


Douglas Scott Harkness: I just finished explaining that they are not deficiency payments; these are flat payments.


Lester Bowles Pearson: They are indeed. I am just trying to explain that the agricultural policy of the government when it was in opposition and when it was talking about policy during the election campaign was a policy based on parity and deficiency payments.


Douglas Scott Harkness: We have deficiency payments in effect for a large number of commodities.


Lester Bowles Pearson: I do not think even the ingenuity of the Minister of Agriculture will be able to prove to the house that the action embodied in this item and the policy they have adopted up to the present in regard to agriculture meets the promises made by the Prime Minister and himself during the election campaign and previously in the house. Indeed, Mr. Chairman, last Saturday when the Prime Minister spoke there was no clarion call for parity. There was no ringing declaration for deficiency payments. There was no formula to guarantee a cost-price relationship, no principle advanced to produce a fair share of the national income for the farmer. And that is what my hon. friends talked about so much during the election campaign and previously in the house.
Therefore we are now entitled to ask the Prime Minister whether he has repudiated his election promises to the prairie farmers on this matter. We are entitled as well to point out that the agricultural policy for the western farmer proposed by the Prime Minister when in opposition is now a virtual shambles. I have no doubt the hon. member for Assiniboia will be able to help me confirm that fact when he gets up.


John George Diefenbaker: You should speak about a shambles and promises.


Lester Bowles Pearson: Deficiency payments are out. Parity is out. A fair share of the national income is not mentioned. What is to be the substitute? This one-shot operation which when it ends, so far as we know, is to be replaced by what? We do not know. We do know that it is not based on any kind of

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principle enunciated in the house or throughout the country by the Prime Minister or Minister of Agriculture. We remind the Prime Minister of his statement in the house that he was laying down as an agricultural policy for the Conservative party of that day "not charity but parity".
I will conclude, Mr. Chairman, by referring to one editorial expression of opinion on this matter, not from the Winnipeg Free Press although they have some interesting references to it.


John George Diefenbaker: That is where your speech came from; your speech has the appearance of Winnipeg Free Press authorship.


Lester Bowles Pearson: My right hon. friend is really almost morbidly and unhealthily preoccupied by what the Winnipeg Free Press says. Why does he worry so much about the Winnipeg Free Press?


John George Diefenbaker: Because apparently it is my hon. friend's adviser in all things.


Lester Bowles Pearson: I am glad the Prime Minister said "apparently" because that, of course, covers almost any statement he can make. I am sure he really thinks that it is more apparent than real. However, I would not hesitate to take good economic advice from whatever source I could get it, and I commend that to my right hon. friend and to the Minister of Finance. I certainly do not know where he is getting his agricultural advice.


Douglas Scott Harkness: You had better go to another source if you want good economic advice.


Lester Bowles Pearson: I do not know where he is getting his advice at the present time but it is not really very impressive when what results from it is this one-shot $40 million operation which as far as it goes will help the grain producers but will leave them high and dry as to what is going to happen in the future. The Toronto Globe and Mail is not a paper normally too friendly to our party but in commenting on this particular vote in its issue of September 4 it had this to say:
Its effect will be neither prophylactic nor therapeutic-it will prevent nothing, neither will it cure. It will do little, considering the price of farmland and tractors, to help him increase the size of his establishment. And rather than protect him from inflation, it will subject him and everybody else to more inflation, because he will not produce with it, just consume.
Then, this editorial ends with these words:
Isn't it time, in short that they stopped looking upon the small farmer, and the small farmer stopped looking upon himself, as a charity case?
I am sure the small farmer does not look upon himself as a charity case, but I am not so sure the government does not look

upon the small farmer in this sense if this is the best he can get from the government on agricultural policy.


Hazen Robert Argue: Mr. Chairman, the amount of money that is involved in this item, and the absence of any formula based on the cost of production, means that the government has abandoned the many promises it made to the Canadian people over the years to provide a system of prices based on parity. The members of the government, for many years, have said to the farmers of this country that if they were elected they would immediately embark upon a policy that would provide such parity prices. This policy-this lack of policy -demonstrates that the Conservative party has finally abandoned the principle of parity and, in the words of the Minister of Agriculture himself, is not providing even deficiency payments to the prairie grain producers.
The type of payment that is being provided by this motion is the worst possible type of payment that could be made. It is a bad type of payment because it is inapplicable, because it is not based on a formula tied to the cost of production, and because it smacks of a handout. The government's position in the past has been very clear. The Conservative party had a handbook in the 1957 election, entitled "Agriculture"-


An hon. Member:: And very good.


Hazen Robert Argue: It is very good; before the election what they said was wonderful, but since the election the performance-


Douglas Scott Harkness: Wonderful, too.


Hazen Robert Argue: -ten per cent. The handbook
says:
Regular motions have been introduced into the house by Mr. Diefenbaker in order to secure for the farmer a more satisfactory share of the national income. April 8, 1941:
"Immediate steps should be taken to create a parity of prices as between agriculture and other products in order to improve the position of Canadian agriculture so that it may receive a just and fair return."
On March 23, 1953, another motion by the Prime Minister:
Consideration should be given by the government to the advisability of introducing during the present session legislation to provide floor prices for agricultural products at such levels as to ensure producers of a fair price-cost relationship.
Where is the floor price for wheat, oats and barley based on the fair price-cost relationship? It is nonexistent. As a matter of fact, the floor price gets worse every year in terms of purchasing power. In recent years the initial prices with the exception of oats, which was reduced a couple of years ago, have remained the same and every year the cost of production goes up. On March 12, 1956, just two years ago the Prime

Minister moved in this house a motion that legislation should be introduced to create a parity of prices for agricultural products at levels to ensure producers of a fair price-cost relationship. I wonder if the Minister of Agriculture believes in parity prices? Does the minister believe that there should be a parity of prices for agricultural products at levels to ensure a fair price-cost relationship? I do not think he does.


Douglas Scott Harkness: We provided that in the stabilization bill.


Hazen Robert Argue: A parity of prices-what an emasculation of the English language. Parity prices, which are based on equity, which are based on a price formula related to the cost of production, but what the minister has brought in is a bill, a so-called stabilization bill, that provides floors on a moving average based on market prices. He calls that parity prices. The Prime Minister, speaking at Kipling, May 17, 1957, is reported in the Regina Leader-Post as having said that by electing the Conservative party the farmers would get parity prices, cash advances on farm-stored grain. Cash advances have been provided and the farmers want to know when the promise to provide parity prices will be implemented.
The Minister of Agriculture has quarrelled with the term "deficiency payments", as being used by the Saskatchewan wheat pool. He says that what they are asking for is a flat payment. I do not care whether he wishes to call it a flat deficiency payment or some other kind of a deficiency payment, but it is much more adequate than anything the government is proposing in this legislation. It is based on a precise formula, that is that there shall be a deficiency payment sufficient to bring prices up to the level that prevailed over the eight-year period from 1947 to 1955. The Saskatchewan wheat pool pointed out that since 1947 the cost of production has gone up by 50 per cent, while the price of wheat has fallen by 21 per cent. They are not asking for parity prices. If they were asking for parity prices, they would probably be asking for well over $2 a bushel. They are not asking for any compensation because of the increase in the cost of production, even though the increased cost of production has been more than 50 per cent. However, they are asking that there shall be protection of their returns so that with the tremendous increase in the cost of production year after year, they do not have to take a lower and lower price in the succeeding years.
They are not asking for a continuing price but a floor price based on an eight-year average from 1947 to 1955. If the farmers were given everything for which they asked they would still be hard-pressed in meeting
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this rapid increase in the cost of production. The Saskatchewan wheat pool is heading this drive requesting a deficiency payment of 27 cents a bushel for the 1955-56 wheat crop and a deficiency payment of 36 cents a bushel for the 1956-57 wheat crop. The minister says that the legislation he is providing will do more for the people who need it most. I challenge that statement. I do not think it is correct. The Saskatchewan wheat pool, in their proposition, would provide a basis of payment relating to the marketing of grain up to a maximum of $1,500 per farmer, depending upon the amount of grain that he has produced.
The Minister of Agriculture went on to say that the reason the government is doing this is not because of any change in the cost of production; it is not because of any fall in price levels, but it is because of a short crop last year and this year. Then, the minister says farm income depends on the size of the crop. This is not as correct as saying that farm income depends on marketings. If the farmer markets more grain, he gets more money. Farm marketings have not been low in recent years, and have not been low in this period to which the farm organizations allude. As a matter of fact, even in the year that has just passed there was more wheat marketed than in the long term average. The wheat pool has this to say:
Moreover, in the last five years while the agricultural problem has been building up, western farmers have delivered more wheat to country elevators than they have on the average for the last 35 years. Canadian exports, likewise, have been above the long-term average in the last two years...
In short, western farmers have been selling better than average crops during these years of surplus. And they have found, nevertheless, that the cost-price squeeze is forcing them into bankruptcy.
That is a very strong term. Does the minister think that $200 will save the farmers from bankruptcy?
The disparity between farm costs and farm prices is the major problem. Farm groups are suggesting that it be solved by deficiency payments on wheat, oats and barley delivered during the crop years 1955-56 and 1956-57.
The Prime Minister has offered them a dollar an acre up to $200. In making his statement announcing the $40 million he outlined what he called a comprehensive long term agricultural program. I do not think there was anything really new in it. I do not think there is anything in it that meets the basic problem of the farmer's rising cost of production and falling prices for grain. The first problem the Prime Minister talked about was wheat exports as well as promotion and market development. Yet in recent years we have been marketing more than an

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average crop each year and exporting more than an average crop while the farmers go bankrupt. So continuing our exports at the good levels of previous years is not going to correct this problem of the price-cost squeeze.
Then the second plank is a comprehensive crop insurance program. I would be most pleased if such a program were brought about. But what does crop insurance mean? It means at the very best that the farmers will get a smaller income in time of crop failure than if they had a crop. Hence at the very best it will give them less money than when they have a crop. They have had good crops. They have sold good crops. Yet they are going broke. A crop insurance program is not going to cure that situation.
The third point, a food bank for deficit areas in time of crop failure. That is a good program. That is part of sound agriculture. But it does not meet the current price cost squeeze at all.
The fourth plank is long term program of farm loans. That above all will not solve the farm problem. The farmers in western Canada now are much more concerned about paying the debts they have than about getting more debts. While long term credit at low interest rates will be of value in building an economic unit, it is certainly no cure for the problem at hand.
The fifth plank is the means of meeting the small farm problem which the government has talked so much about. The government has under consideration ways and means of improving the level of living of farmers on small farms by means of better land use. That will not do very much. The farmer on a small farm is probably the best authority about how to use his land most efficiently and he is using it efficiently. He is using it so efficiently that he has marketed the biggest crop in history in recent years. So that is not going to get him out of this mess.
The government is going to encourage the formation of economic farm units. The problem is that we have the small farm. Now they say they are going to get him a bigger farm. It means only one thing, namely that there will be fewer farmers. When you get one farmer on a bigger piece of land, there is less land for somebody else because the supply of land is fixed. When you divide it up into bigger units, you have fewer farms. So what they say is that they are going to help the small farmer by getting rid of him and leaving the land to larger farmers on economic units.
As the sixth plank, plans are already under way for a national conservation conference. Judging by the accomplishments of some

recent conferences, I do not think too much hope can be given to the producers on the basis of a conservation conference to deal with the whole question of the price-cost squeeze and the economic position of the farmer.
What has been the reaction to this in western Canada? The other day I put on the record some of the comments of Mr. James Paterson, head of the Interprovincial Farm Union Council. I notice that other prominent persons in Saskatchewan have been making statements. I have here in my hand a clipping from the Saskatoon Star-Phoenix of September 2. It is entitled "Ottawa 'Deficiency' Payment Piddling, Van Vliet Thinks".
-said Professor H. Van Vliet, head of the farm management department of the university, "reminds me of the Bennett nickel-payment of the 'thirties'." That is. he considered it too "piddling" to be worthy of much attention.
One of the very best agricultural economists in the province of Saskatchewan, the head of the agricultural economics department at the University of Saskatchewan, a man of many years experience in agriculture and in farm economics, a man who is not given to making exaggerated statements, calls the payment piddling. R. B. Bennett, when the pressure was on in 1931 and western grain producers were in a squeeze, brought in a payment of five cents a bushel on wheat. If the government had brought in a five cent a bushel payment on wheat for the two years that the wheat pool is asking about it would have amounted to about $35 million. That would have been almost as much as the government is now providing for; and if they had made comparable payments on oats and barley, it would be more. A five cent payment based on purchasing power of 1931, related to the quantities of wheat marketed in the years 1956-57, and extended to oats and barley, would have meant more today than the $40 million based on the $1 an acre that we have under consideration. This is no better treatment in 1958, in terms of the cost of production and the value of money and the agricultural prices, than R. B. Bennett's five cents a bushel which did the Conservative party in those years more damage than good.


Mr. Nasserden:: Why did it do more
damage?


Hazen Robert Argue: Because it was not enough. It was something like the $6 increase in the old age pension. Every old age pensioner was glad to get it but it was far short of what was justified and needed and it made him so angry that he voted against the people who had provided the inadequate increase.

I do not think that this payment meets the situation. I do not think it is nearly enough. The second vice president of the Saskatchewan farmers union is reported in the newspapers as saying that he is giving Saskatchewan farmers advice to take the $200 they are paid and invest it in a return railway ticket to Ottawa so that they can all come down here in a mass delegation and impress upon the government the need to provide deficiency payments in keeping with the requests of the farm organizations. This payment of a dollar an acre will mean $200, of course, to the majority of farmers. Will that solve the economic crisis which he faces? How much money is it? It is 55 cents a day.
I ask the government to consider how far 55 cents a day will go towards providing the farmer and his family with an income and how far it will go towards paying the cost of production of agriculture in this country?
The position the Prime Minister has taken in this house until recent months in advocating a system of parity prices, a system of support prices, based on a fair price-cost relationship was clearly a good one. It is just as valid today as it was in 1941 and in the subsequent years when he moved these motions. It is needed just as much now and we are apparently just as far away from getting it as we ever have been.
I would hope the government will meet the request of farm organizations for deficiency payments based on what I consider to be a reasonable formula, a system which does not ask for an ever increasing amount related to an increase in cost of production but which merely says there will be support prices which will not allow a further deterioration in the prices of wheat, oats and barley.
A few years ago we had a strenuous debate in this house at the end of the United Kingdom wheat agreement, resulting in the provision of $65 million from the national treasury into that pool. This $65 million was not then felt to be adequate from the standpoint of western farmers, but the need today is much greater than it was then because, since that time, the price of farm products has deteriorated by a very large amount.


Douglas Scott Harkness: Livestock prices are away better than they were at that time and so are dairy prices.


Hazen Robert Argue: The minister did not say when his party was advocating parity prices that the parity prices for grain producers would be forgotten about if the market for cattle appeared to be improved. No, Mr. Chairman, the farmers of western Canada will not be satisfied until the government provides them with a floor price, a continuing one, at a
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reasonable level and until they feel the government has fulfilled its many promises to provide parity prices. The sum of $200, as I said a few days ago, is worth just $200, and to that extent is welcome, but $1 per acre is a very small part of the amount of money necessary at this time even in the face of very large markets to give to the people on the prairies a standard of living which compares reasonably well with that of other Canadians.


John George Diefenbaker: I do not want to take up the time of the committee at great length, but having listened to the two speeches made by the Leader of the Opposition and the hon. member for Assiniboia, there are a number of matters to which I think reference should be made.
I have listened to my hon. friend from Assiniboia on many occasions and he is the most generous man with other people's money I have ever known. He is all for the reduction of taxes, the almost removal of income tax on average incomes, but when it comes to generous promises and statements with regard to what he would do in the circumstances, he has no equal in this house.


Some hon. Members:: Hear, hear.


John George Diefenbaker: I think that tribute is due to him because he brought up an example a little while ago as a passing jibe at the Liberal party, that having increased the old age pension by $6 per month they had thereby annoyed the old age pensioners who, while pleased to receive that amount, found it convenient and proper to vote against the Liberal party. I would say to the hon. gentleman that if the amount of promises resulted in votes in keeping with the exaggeration of the promises made by C.C.F. members before the last election, the numbers in his party would not have been reduced from some 25 to 8, because as I remember it those irresponsible promises indicated $75 per month for the old age pension. The people cannot be deceived by such promises which are made simply for political purposes.
One of the major reasons-and I say this with great respect to the hon. gentleman to whose advocacy I have always paid the strictest regard-for the diminution of national support for the party he represents is the irresponsible nature of the promises made by those associated with him.
I take second place to no one-


John Whitney Pickersgill: In making promises.


John George Diefenbaker: -in my desire to see that agriculture shall receive its fair share of the national income, and that has been the purpose and the aim of the government which I have the honour to lead. We have gone forward

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in the last 15 or 16 months during which time we have been in office to a degree that has met with the support of farmers generally across Canada as well as other citizens.
I know it is a great tribute to us that it is expected that all the promises we made would be completely implemented within the short time we have been in power. I ask my hon. friend to go across this country and to see whether the reaction he finds is not that never before in Canada has there been in such a short period of time during which a government has been in power when so many of its promises made to the electorate of the country have been carried out.
No matter what is done, my hon. friend will always say it is not enough. This will be the case no matter what course is followed. For years he was advocating, and in this he joined with the rest of us, the Saskatchewan dam project, but when we proceeded as one of our first acts to implement our promises in that regard we receive from him that qualified approval that we have not done enough in rendering at least $75 million available to the people of Saskatchewan.
One of the first acts of this government when it assumed office was to commence a review of the agricultural policies and these studies have been productive of legislative and administrative action which has materially benefited agricultural producers in all parts of Canada. 1 point out to my hon. friend that while I am not among those who accept in their entirety the Gallup polls which are taken from time to time, since this parliament began we have received an increase in support from the farmers as well as from other citizens of Canada because this government has gone ahead in an endeavour to bring about a new concept of implementation of promises made at any time heretofore. One of the first acts of this government when it assumed office in the development of our agricultural policy was the legislation passed under the title of the Agricultural Stabilization Act which provides Canadian farmers with a degree of security they had not known before.
I should like to review briefly what this measure has achieved for Canadian farmers. As hon. members know, the Agricultural Stabilization Act provides for the mandatory stabilization of the price of nine key commodities at not less than 80 per cent of their average price for the preceding ten years. These nine commodities represent 65 per cent of the farm cash income apart from western cereal grains. This act also provides for the stabilization of prices of non-mandatory commodities at levels fixed by the governor in council.

The effective prices fixed for the mandatory commodities have been about 100 per cent of the previous ten years average for butter and cheese, 85 per cent for eggs, 84 per cent for hogs and 80 per cent for cattle, sheep and wheat, oats and barley outside the wheat board area. Then other commodities for which stabilization is not mandatory have also been brought under the act at prices reaching up to 90 per cent of the ten year average for soy beans, 93 per cent for sugar beets and 110 per cent for wool.
The steps taken under this act have been successful in preventing serious price declines in several commodities. In others they have provided a measure of price assurance for farms which has enabled them to plan their operations with a high degree of confidence.
"Done nothing", he said. "Taken no steps in a year to implement the promises." But the hon. member will remember that under the stabilization act regard is had to the cost of production so as to bring about as far as possible that degree of security for the farmer which will bear a fair relationship to the cost of production.
In so far as the prairie farmers are concerned, while support was given to the measure when it was first introduced by the hon. gentleman and by those associated with him, it was always subject to some suggestion that it was not enough or that there was something wrong with it. The hon. gentleman has fine ability but he is developing a carping attitude. No matter what is done he always has to carp, he always has to indulge in some small criticism. This is not in keeping with what he used to be, and I point this out to him as one who has listened to him throughout the years with interest and admiration. The hon. member has developed a tendency which is dangerous to one so young as he, an attitude of continual carping, a continual dealing with small things, never prepared to say that anything is right or that steps are being taken in the direction of improvement.
To meet the specific regional problems of our prairie farmers, interest-free cash advances to the amount of $34.5 million were provided to some 50,000 farmers on their farm-stored grain. I have already referred to the South Saskatchewan dam irrigation project, which is a major matter of benefit to agriculture. I can also refer to the steps that have been taken to prevent the dumping into Canada of agricultural products so as to preserve for the Canadian farmers their proper markets and to safeguard them against this type of competition which bears no relationship to actual cost. These are some of the things that we have

done. These are the courses that we have mapped out. Our objective is unchanged, namely to raise agriculture and the other economies of our country to a level in keeping with the general situation prevailing within our country and internationally.
Today the hon. member grudgingly admitted -I think it was a grudging admission, by his attitude and his manner of speech-that last year as a result of a vigorous export policy by the Department of Trade and Commerce Canadian exports of wheat rose to 317 million bushels, the highest in five years, at a time when other exporting nations had experienced major declines in their sales.
These are some of the things that we have been able to achieve in a matter of 15 months or slightly more, during a portion of which time we were absent from our duties because of an election campaign. These are some of the things which we have done. I set out the plan for the future and the course to be followed at the election as we proceeded step by step, and in the meantime made provision to assist, in particular, the small farmers by payments as provided in the estimates now before us.
I listened with interest, also, to the Leader of the Opposition. He dealt with agricultural matters. He spoke of the cost-price squeeze. I do not seem to remember that at any time when he was in a position to do something on behalf of western farmers or on behalf of farmers in general across Canada he showed anything like the enthusiasm which he is displaying today. We talk about promises. I have some here. These are the agricultural promises made by the hon. gentleman in his speeches across the country, things which could have been done, action which could have been taken during the years in which the government to which he belonged was in power. During all those years we asked for some action. Today when action is being taken and when a course is being followed which will bring about the rehabilitation of agriculture to a state which it has not enjoyed in recent years, the answer given by the hon. gentleman is that from the paper from which he quotes so frequently, or from the group of advisers who served him so ill only a few months ago by the advice they gave him then. It is an interesting attitude, the one shown by the hon. gentleman. He is ambidexterous, if I may use that expression. He says: "Oh, it is $40 million, but it is not worth while considering; it has no principle."
The principle was set forth by the Minister of Agriculture, and I set it forth the other day. It is a provision that is meant to meet an immediate situation. The amount in question is, as I stated the other day, more than the
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amount which for so many years represented the request on the part of hon. members of the C.C.F., the amount that would have to be paid into wheat board funds in order to secure for the farmer under a two-price system a fair and proper return for that portion of his wheat production which is used in Canada.
We have taken this step. We intend to carry out by gradual stages a policy to bring about the achievement of that which we advocated through the years. My friend the hon. member for Assiniboia talks about marches on Ottawa. That is something he has been trying to get the farmers to do for months. I have read the speeches he made out there. He called on the western farmers to march on Ottawa and they told him to march back to Ottawa by himself. All over western Canada he has been bringing about that new form of democracy that consists in having the farmers march. He spoke about it again today. He said the $200 could be used by the average farmer to buy a return ticket.


Hazen Robert Argue: It was the second vice-president of the Saskatchewan Farmers' Union who made that statement.


John George Diefenbaker: The hon. gentleman has been able to produce one or two but he has not been too successful on the whole. He went out to western Canada. He talked to the farmers and urged them to march. "On to Ottawa!" was his cry, but he came back by himself.
Mr. Chairman, this is part of an agricultural policy designed, as the Minister of Agriculture said a moment ago, to meet an immediate situation. When the next session arrives we intend to introduce a measure for which the farmers have asked from the earliest days in western Canada, something which has also been requested by farmers in other parts of Canada, an insurance plan to bring about the assurance of at least a modicum of income, that degree of income which will not cost the farmer too much to assure himself of, and through which during the dark days of drought the farmer may be assured of at least a fair and reasonable rate of return. That is one of the things that came about under the Prairie Farm Assistance Act. That met the situation in the western provinces to a degree. That legislation was placed on the statute books as a result of the initiative of the Right Hon. J. G. Gardiner. It has been expanded, it has served a successful purpose and has been beneficial. Farmers generally are today asking for something further in that direction and it is because they are asking

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for that we intend to provide the opportunity at the next session of parliament of taking this further step.
I am not going into the question of deficiency payments. I dealt with that on the other occasion and I am not going to take the time of the committee to deal with it again. I pointed out that during the election campaign and prior thereto I had stated at no time that deficiency payments would be introduced. At no time did I directly or indirectly promise deficiency payments. What I said was that this was one of the suggestions made by the farmers that would receive the fullest and most sincere consideration. We gave it that consideration for weeks on end. We listened to the views of economists. We discussed the general situation in so far as international trade is concerned. I placed our reasons before the house when 1 mentioned the particular item of $40 million. At that time I explained that deficiency payments applied to deliveries of grain would fail to help those producers most in need and would require very large subsidies from the federal treasury.
My friend the hon. member for Assiniboia talks about 10 per cent. What he is asking for apparently is $400 million. If $40 million is being given at this time by way of advance, is it 10 per cent?-


Douglas Scott Harkness: Less than 10 per cent.


John George Diefenbaker: Yes, less than 10 per cent. Let us be reasonable. Does my hon. friend suggest that there should be made available at this time over $400 million? That is the kind of argument that brought about the situation in which he and his party find themselves today. No farmer with whom I am familiar in the western provinces has been other than reasonable throughout the years. They have not asked for the impossible. They have requested a reasonable return. I speak for the large body of those in the western provinces who throughout the years have known that when I spoke to them I have represented the facts as they were.
The government made a careful study of this matter. The serious implications for our export trade have not been answered. The subject was conveniently neglected by hon. gentlemen who have spoken. Deficiency payments to producers will be classed as a producer subsidy and grain entering export trade may be liable to countervailing duties in certain countries.
When we tried to do something on behalf of the farmer by bringing in anti-dumping legislation my hon. friend the Leader of the Opposition said, "Of course I am for it, but we are against it". On both sides of the question in so far as GATT is concerned of

which he spoke so eloquently, were we to enter into the scheme that is advocated in the form in which it is suggested we would find ourselves immediately in difficulties in our export trade.


Mr. Gour:: You are out of order speaking about GATT.


John George Diefenbaker: In so far as our exports to the United States of oats and barley are concerned, as I said previously, close to 100 per cent of our export trade in oats is to the United States and one-quarter of our export trade in barley is to the United States. To bring into effect these payments on these two particular grains would result in action being taken against us which would be nothing but detrimental to the Canadian farmers as a whole.
We gave the fullest and most complete consideration to this question. I myself know something of the western farmer and his problems. I know it from those days long ago, the earliest days. I know the difficulties experienced by the farmers in those early days when we went on to land that was entirely virgin. I experienced those days and I know those difficulties. That is one of the reasons why the policies we have enunciated were designed in order to meet that condition.
We took steps at the last session in so far as cash advances are concerned and also under the Agricultural Stabilization Act. This session we took steps, as we have since we came into power, to meet the terrific competition that farmers are receiving through imports of agricultural products from other countries being dumped into the markets here to the detriment of Canadians. We have taken the necessary steps at this session. We took action with respect to rehabilitation through the South Saskatchewan river dam. In addition to that we made provision for an immediate situation. At the next session our further unfolding of the program that was enunciated will be carried out to the end that agriculture will be able to attain that position wherein a degree of fairness and justice will be assured not only to farmers in western Canada but to farmers generally throughout the country.


Mr. Rapp:: Mr. Chairman, in rising to speak on these estimates I should like to say at the outset I am in full agreement with the principle of the motion to make payments to the western grain producers for which approval is sought in the estimates that are before us. I am grateful to the Prime Minister for introducing this legislation and to the ministers who were so instrumental in drafting a formula under which payments will

be made on an acreage basis so that every farmer will benefit. The $40 million proposed in the estimates will be of assistance to the western grain growers who have been labouring hard under the price squeeze in which they have found themselves over the last few years. One must be a grain grower to know what it means to produce under such a cost of production. Taking into consideration the so-called price squeeze that has been with us for a long time, without any attempt having been made in the past to prevent it or cope with it, this payment cannot be expected to rectify all the evils of the past. However, it is reasonable to assume that the $40 million proposed as payment for one year will have an effect on western agriculture and will alleviate some of the hardships experienced in the past. Indeed, it will go much further than the agricultural policy that we heard so much about last winter, namely the ten cent increase in the initial price which money in the first place belongs to the farmer.
Had steps been undertaken in the past or even as late as 1955 when it was apparent then as it is now that the price the farmer was receiving for his produce was away out of line proportionately with the prices he had to pay, the situation would not have been as grim as it is now. Consequently the effect of this payment at the present time would have been much more beneficial as the need would not have been as great as it is now.
With the way the situation is now it will be expected that the forthcoming payment should correct all the shortcomings of past years but it must be admitted this is almost impossible without putting too big a burden on the treasury in one year. The part I like most about the action taken, and I know it is appreciated by many farmers, is the fact that this is only one part of a long range program for Canadian agriculture. As stated by the Prime Minister, under this policy, among other benefits, the farmer will find protection from such hazards as drought, frost and crop failures of various kinds.
This is a policy which has been advocated over the years by farm organizations and authorities on agriculture. If it is implemented it is hoped it will put agriculture on a sounder economic basis. In my opinion this program will go a long way towards achieving the ultimate goal, namely to give the farmer a fair return for his investment and labour and to place him in the same position as other segments of our nation by giving him a fair return for his investment and labour.
I would be failing in my duty if in connection with this estimate I did not mention the agricultural amendments implemented during this session, namely 57071-3-300
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P.F.A.A. cash advances and others. All these acts were amended to meet changing conditions in agriculture and I know that if changes should be necessary in the future in connection with what we are now discussing they will be forthcoming.
Finally, I should like to say that I am pleased that this estimate has been brought in at this time. If it had been introduced last winter or before March 31 it would have been classified as just election bait but now it will serve as a clear indication that the government is concerned with the welfare of all sections of our country. On behalf of the western grain growers and myself I should like to ask the house to approve the estimate before us to provide for payments to western grain producers in accordance with the regulations of the governor in council.


Chesley William Carter: Mr. Chairman, in replying to the Prime Minister's announcement of this policy a few days ago our leader had this to say, as found on page 4348 of Hansard for August 30:
I am thinking particularly at this moment of the fisherman who has also had his hard times, and who perhaps will look with a certain amount of envy to this kind of action taken by the government for the grain producers.
Naturally, Mr. Chairman, we do not object to this legislation but, as has been pointed out, our fishermen can suffer from the failure of the fisheries just as farmers suffer from the failure of crops. My purpose in rising at this time is to call to the minister's attention the fact that the fishery has failed this year in many parts of Newfoundland, and we hope that the same consideration and assistance will be given to the fishermen as is being given to the farmers under this legislation.


Mr. Pascoe:: Mr. Chairman, as a western farmer I had intended to take part in the discussion of this supplementary payment of $40 million to the prairie grain producers. No statement is necessary from me now. I want to thank the Prime Minister and the Minister of Agriculture for answering opposition statements so fully. The statements of the Prime Minister and the Minister of Agriculture will be very carefully studied by prairie farmers and I suggest that they will be well received when considered in relation to the government's long range agricultural policy.
There is one important aspect of the government's farm policy that I should like to emphasize for a moment because it is a part of the long range program. I refer to the farm cost survey on the prairies late this fall. I want to congratulate the Minister of Trade and Commerce on his announcement of July 19 of this farm cost survey. On July 19, as

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found at page 2469 of Hansard, the Minister of Trade and Commerce said:
X believe it will meet a very great need because we are always encountering the problem of cost and income in so far as agriculture is concerned.
Such an inquiry into farm costs is greatly needed in the formulation of the government's long term agricultural policy. Such a step should have been taken years ago by the previous government. The fact that they did not undertake such a survey and did not have any definite figures explains why their agricultural policies during 22 years lacked any long range objective.
There has been a great deal of loose talk about farm costs. I say "loose talk" because definite figures are not available. When I was in Ottawa with the prices board in the 1940's the question of average farm costs was always coming up and no one had a definite answer, not even the farm organizations. I recall one conference of prices board officials with farm groups when the question of the cost of producing a bushel of wheat was raised. There were almost as many different answers as there were farmer representatives in the room.
I mention this, Mr. Chairman, in this committee to emphasize the importance of the farm cost survey this fall. The undertaking of this farm cost survey indicates the determination of this government to tackle and solve Canada's farm problems. I am sure that the prairie farmers will accept this $40 million supplementary payment in the spirit in which the government is paying it, as immediate help in a problem that can only be solved by a long range program, such as a program of better farm credit, national crop insurance, better land use and greater wheat sales, which this government is undertaking. The farm cost survey this fall is, as I said before, an indication of this government's determination to tackle the farm problem and to solve it.


Edward Nasserden: In rising to take part in this debate, I am reminded of a day many years ago in the history of our country when the minister of agriculture saw his sincere efforts to help misunderstood by those whom he sought so diligently to assist. I refer, of course, to the five-cent payment to which reference has been made in this debate, a payment that was made during the period when the Hon. Robert Weir was minister of agriculture. This payment went to the farmers who produced the grain, but did not go to farmers who did not have those bountiful crops of grain. It is for this reason we have this estimate based on an acreage payment which will go out to farm people, and which will give them something
[Mr. Pascoe.l
to make up the difference between the sale price and the cost of production.
During the past several days I have had reason to think back over the past 20 years during which I have been actively engaged in the agricultural industry. Before that, I recall doing the chores on my father's farm. I recall various responsibilities from time to time, and particularly those which resulted from service in positions which resulted in one being continually confronted with the problems of agriculture. On this occasion I should like to put on record, for this parliament and for succeeding parliaments as well, the acceptance of the government's action, with the usual reservation that they pursue this whole matter of farm security and the attempt to ensure that the people engaged in this industry shall enjoy a fair share of the national income. The Prime Minister did a creditable job today and a few days ago in presenting the overall agricultural situation in this country, that is as creditable a job as anyone could do before the report of the price spreads commission is made public and before the survey that is now being conducted into farm living costs and costs of production in these various areas of Canada where agriculture forms the basic industry is completed.
It seemed to me that as he spoke the other day, and again today, he spoke as no other man in the recent history of our industry or of our parliament has spoken on behalf of those engaged in the agricultural industry. He spoke with a feeling that came from recognition of how closely the farm people of this country are confined to overalls. This is one of the reasons why I am convinced that the legislation which will follow will be the type that will endure for many years to serve this industry that is basic to Canada's economic welfare. From the very beginning, I have been one of those who has held the view that our first consideration should be the adoption of those measures which will help to build a sound national policy and which will apply with equality to farm people in every segment of our industry and in all parts of the country.
What is of even more importance is the fact that this session has resulted in the development of some of the bases of that agricultural policy, and of equal importance is the fact that even now the remaining part of that program is only awaiting the application of a reliable basis upon which to put these things into operation for the benefit of the people in all parts of Canada. The present item ir. the estimates is a short terms measure which will be welcomed by the farmers in western Canada, especially in the light of the long

term objectives which have remained untouched over a period of years by those who today form the opposition group in parliament. I do not think that anyone in western Canada will seriously consider this assistance as peanuts, as was suggested by the hon. member for Assiniboia the other day, nor do I believe his reference to it as a pittance will go down very well with many thinking farm people. At the same time, I acknowledge that does not mean that the needs of the western farmer have been fully met.
The stabilization bill fulfils a widespread need in many parts of this country, and it will become increasingly important as the production of livestock continues to increase in our province. Earlier in the estimates we had an item of $17,500,000 to reimburse the eastern feeder for his purchases of western grown grains. This measure is designed to help the eastern farmer, but at the same time it is an incentive to the movement of western grown grains which the western Canadian farmers certainly appreciate.
This session of parliament has granted, almost to the last detail, those things for which the farmers in western Canada have asked. There has been the amendment to the P.F.A.A. to which all who produce grain in western Canada contribute on every bushel they sell. The problem of crop insurance and farm credit has been under study, and the Prime Minister has held out hope that those things will be brought before us at the next session of parliament.
The government must have had a good reason for deciding that farms of 200 acres or less were the ones upon which to base their short term assistance. Some people in western Canada will be disappointed that the government did not decide on a unit that could more properly be described as an average size farm in grain growing areas. I have given this matter a great deal of consideration, and have come to the conclusion that perhaps as a result of this choice the government has allowed a principle to be established upon which farm people will be able to build a powerful case when the ranks are finally closed as between farmers in all parts of Canada, and when they come armed with the statistical data to establish their right to a full and fair share of the national income.
From each of the western provinces there have been those who have devoted themselves diligently and faithfully to their constituents in this matter. It has been a source of satisfaction to be associated with them in the agricultural caucus of our party. I think it is only fitting that on this occasion so near the end of the session I should express the appreciation and satisfaction that has come to us all as members from other parts of Canada
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have shown the same desire and capacity to envision a truly national policy for agriculture.
If I have one regret in this whole matter I hope that I may be pardoned. It is that the constituency of Assiniboia did not have a representative in the government caucus to speak for the people of that great grain growing area of Saskatchewan. Their representative in the commons could only ask the question: "When?" It did not matter how many times he asked that question, it did not add a single dollar to the amount embodied in this estimate. In fact, the hon. member for Assiniboia seems to have forgotten-


Charles Edward Rea: Order. In this item 663 I do not see anything mentioned about the hon. member for Assiniboia. I would greatly appreciate it if the hon. member would stick to item 663.


Edward Nasserden: The policy of this government in providing funds to purchase wheat for disposal in certain areas where we might not otherwise be able to secure a commercial market is one that should assist in the reduction of our wheat carry-over; and to the extent to which that carry-over is reduced, deliveries will be increased from farms in western Canada. This should have a relieving effect on the problems arising in those areas where yields have been above normal. It would appear to me at this time there should be little wheat left on farms at the end of this crop year, owing to natural crop conditions as well as the marketing policy and disposal plans of the government.
I should like to say also that I am one of those in western Canada who produce grain. Our harvest started about two weeks ago, and I have had to curb my impatience to hear again the rhythm of harvest machinery, a tune that shells out Canada's second largest single export item. That should be a reminder to people in all parts of this country that we are fortunate in Canada indeed to have the cereal producing areas within our borders.
I should also like to say that it should be a reminder to people in all parts of this country that without these resources of cereals we would be bidding in the export market today for bread grains. Maybe then people in this country would appreciate the value of a bushel of wheat in relation to the incomes that they enjoy today.
During the past two weeks, awaiting the introduction of this measure, I have had the leisure to re-examine the history of the party that first won my loyalty at a time when there were few indeed who were giving it a second thought as an instrument through which to achieve some of the principles important to the industry in which I found myself. During

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that period I have taken the trouble to reexamine the history of the farm organizations and the industry in which I find myself, and to chart the progress that has been made from time to time as a result of the dedicated efforts of those organizations. Being as closely associated with some of that history as I have been, any assessment of farm legislation on my part is naturally critical. Yet, taking all things into consideration, I find that I am almost unwillingly enthusiastic about the measure of achievement that has been chalked up by the members of this government at this session of parliament that today records a breadth and sum of achievement never before achieved by any party anytime hitherto in the history of our country.


Hazen Robert Argue: I enjoyed the remarks of the Prime Minister immensely, Mr. Chairman. I do not think he has been in better form except perhaps on that famous day of January 20, I think it was. I know that in relation to the seriousness of the debate and the degree of concern one sees, the Prime Minister puts every effort into his speech. He is a tremendous orator. There is no doubt about that. He has the largest bag of tricks of any hon. member in this house. We appreciate that fact from knowing the hon. gentleman for many years. I do not know whether, when he was in the opposition, his criticism was carping but it was consistent. He was the most critical that I think has ever sat in the opposition, even more critical perhaps than the present Minister of Public Works.


Mr. Green:: Oh, no. Leave me out of this.


John Whitney Pickersgill: It was a neck and neck race.


Hazen Robert Argue: How the Prime Minister used to needle the government. He would get the Right Hon. C. D. Howe so angry that he would make statements that were so unparliamentary that I would not want to repeat them. The Prime Minister is a very able politician. He knows when things are going well in the house and the minister conducting the legislation is doing an excellent job, that the legislation is airtight and that he then <}oes not have to pay this meticulous attention to the debate of the house. But I do not recall a Prime Minister who began a debate originally by a very long statement-an almost unprecedented statement by way of length-on motions regarding an item that was to be passed in the estimates by one of his colleagues and, after having made a very long statement and after having outlined in addition to the temporary policy, the long range vision of what might be done in many 
years ahead, comes into the house and makes a very strong statement on the item itself.
I think I have known the Minister of Agriculture as long as I have known the Prime Minister. He being an Alberta man or a prairie man and conversant with the grain problem, I thought that probably he would be taking a much more prominent position in this debate than that which he has taken so far. As I say, when the case is very weak, the Prime Minister makes up for it by pulling out all the tricks. He ridiculed the C.C.F.; and when I am the only member from the prairies on the opposition side that is not hard to do. The Prime Minister has 47 of the 48 members. I do not really think that is because the C.C.F. did such a bad job in the opposition. I think it is because our hon. friends in the official opposition, when they were in the government, did such a terrible job and the people on the prairies were so anxious to get rid of them they said, this is the party that probably has the best chance. The farmers today are caught in the price-cost squeeze. The C.C.F. candidates were caught in a political squeeze. But I do not think that pointing out that the Conservatives have 47 members from the prairies, the C.C.F. have one member and the Liberal have no members is really a good sound argument in favour of anything.
I do not think that by following this course the Prime Minister is really doing himself justice. Oh, I can remember when he was the lone wolf from Saskatchewan, the one Conservative member. That was also mentioned in this house, and he was not allowed to forget that it was the policies of R. B. Bennett which had made it impossible to elect a Conservative in Saskatchewan either provincially or federally with the exception of my hon. friend. But he built for himself a good reputation in this house as the only Conservative from Saskatchewan, the reputation of being in the opinion of many Saskatchewan people a very forceful and authentic voice of the true wishes of the people of that province.
I have no hesitation in saying today that I believe in advocating and in championing the deficiency payments for which the farm organizations have asked and not only the farm organizations but the boards of trade, the retail merchants associations, the municipal associations, the teachers associations and some of the church conferences which have passed on this question and that I am no less speaking for them at this time than was the Prime Minister when he spoke on other matters in other days.
I say this because I believe the people of Saskatchewan without reference to party

believe that the prairie people are entitled to something more than is contained in these estimates.
I thought as the Prime Minister was talking that we were back to the throne speech because he referred to a great many things which had gone on during this session, but there was one reference which I noticed he did not make. He did not say "I am still for parity prices". He forgot all about parity prices and all about his statements in the past. I think the Prime Minister used to be in favour of parity prices, in fact I know he was. The Minister of Agriculture never was, never has been and is not today. If there are some things which make us excited in this house, one thing which makes the Minister of Agriculture excited is an argument on parity prices.


Douglas Scott Harkness: It does not affect me at all.


Hazen Robert Argue: He sees in parity prices a great danger to the country. He says, "Look at the Americans who tried it." That did not prevent the Prime Minister himself over the years from advancing this policy day after day.
The Prime Minister has said that the farmers today enjoy a degree of security never before known. I will let the farmers themselves decide whether or not that is true, whether they are better off today with the average price of a bushel of wheat at $1.23 or whether they were better off in 1943 after the price of wheat had been increased to $1.25 a bushel. I will let them judge whether they enjoy a greater degree of security than ever before in the light of the reduced final payment on the 1956-57 crop year by 5 cents or 6 cents a bushel. I will let them decide whether they are in a better position with a continuing increase in cost of production.
The Prime Minister has said the government has kept its promises; he has talked about the commitments the government has made and some of them have been met. When they have been met we have fully supported such legislation, but some of the promises have not been kept. We were going to have a report on the old age pension system in the United States within three or four months after the appointment of Dr. Clark. We have heard nothing of it yet and I thought we were going to have immediate action after the receipt of the report. We knew there was going to be a federal-provincial conference; we knew that, the government said so, but it has not taken place. So that promise has not been kept. There was going to be no suffering from unemployment in this country-the Prime
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Minister said that too. He said, "No unemployed person will suffer under this administration" or words to that effect, but we still have very, very widespread unemployment and a great many people think that this coming winter will be-


Some hon. Members:: Order.


Hazen Robert Argue: I am out of order-the Prime Minister was out of order and other members were out of order. The Prime Minister dragged in everything but the kitchen sink and I am at least sticking to some of the promises made by the government.
The Prime Minister made a great to-do about what he said was my general reaction to anything done by the government, that it is not enough and that it should be a lot more. I would say that is a reasonably consistent stand which I take, although I know of many, many things, probably most things passed in this house, which I have supported without question, because almost every item which goes through this house goes through unanimously.
I think, however, that the role of the opposition is as important as is the role of the government. The role of the government is to bring forth legislation and that of the opposition is to criticize such legislation and to point out its weaknesses. I believe that more could be done for western agriculture than is being done and that more could be done now. I would say to the Prime Minister that when I am fully satisfied with everything the government does, then I will cease to be of any value as a member of this House of Commons because it is the duty of members of parliament to do their best to improve the legislation before the house.
The Prime Minister said I am always trying to promote a march on Ottawa. I believe I mentioned that a couple of years ago-


Some hon. Members:: Oh, oh.


An hon. Member:: More recently.


Hazen Robert Argue: No, I think I have used the words "mass delegation" since that time.


John George Diefenbaker: Oh no.


Hazen Robert Argue: If the Prime Minister would just hear me, I would say, with respect to his suggestion that I have been promoting a march of the farmers on Ottawa, that I am not denying that nor am I agreeing with it. All I am saying is that I believe I used the word "march" a couple of years ago but to the best of my knowledge I have since referred to it as a mass delegation.


Gordon Minto Churchill: To Ottawa.


Hazen Robert Argue: I would remind the Prime Minister that while he can take his pick and

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he can use any word he likes, certainly all statements about mass delegations to Ottawa do not emanate from me. They are from other people who are interested in sending a mass delegation to this city, and I know from acquaintance with the directors of the Saskatchewan wheat pool that at their general meetings over the last few years they have asked their board of directors to so press the deficiency payment policy approved by their organization upon the government that they would get a decision from the government and, failing a favourable decision, to undertake the organization of a mass delegation to Ottawa. It is not something new; it has happened before, and in fact it happened in 1942 when the Prime Minister was a member of the opposition. It can happen again, depending, I am sure, on what kind of legislation is forthcoming from the government in the days ahead. The farm organizations have carefully considered the question and they are advocating deficiency payments and they are dissatisfied with the item now before the house. They consider that if these requests are not met they will send an organized mass delegation, which is their right in a free country, to wait on this parliament and on this government in Ottawa.
I have no hesitation in repeating that I believe prairie people generally do not feel that this sum of $40 million is adequate and that they are asking for deficiency payments as set forth by their farm organizations.


Gordon Minto Churchill: I shall not detain the committee over long, but I do think in view of some remarks which have been made this afternoon by the Leader of the Opposition and by the hon. member for Assiniboia that a few facts should be placed on the record which will be helpful to those people who will be reading this debate with a great deal of interest because the subject is of very considerable importance to the farm population of western Canada.
In view of the representations that have been made to us during the last 14 months and the importance attached to this subject I think it would be helpful if some pertinent facts were inserted amid the remarks that have been made this afternoon. When the representatives of the farm organizations the pool organizations-came to see us in January to present a brief relating to deficiency payments and other matters they pointed out that several countries of the world were making deficiency payments to their wheat growers. This argument has been used on many occasions and it is very plausible until we examine it carefully. They drew our attention to the fact that the following countries assisted their wheat growers from

a figure of $2.06 a bushel up to as high as $4.03 per bushel. They listed the following countries:
Ireland
United Kingdom Belgium Japan Austria
Germany
Brazil
Italy
Norway
Switzerland
They said to us: this is the type of support which is given elsewhere. But with the exception of Italy, which now and again exports some wheat, the other nine countries are all steady annual importers of wheat, and the deficiency payment as used in those countries is used as a stimulus to production. They are trying to raise the level of production so that they may cut down their imports, and that is why they have made use of these deficiency payments. A deficiency payment used for this purpose in a country such as Canada which is a great exporter of wheat would not be anything like as helpful.
The deficiency payment asked for by the farm organizations was based on a bushel payment idea, which means that those who had wheat to deliver in the years 1955, 1956 and 1957 would be the ones who would get the benefit. They paid little attention to those who were in the position of having little or no wheat to deliver. Yet one of the basic problems facing western agriculture has been the variability of income due to the variability of crop conditions. Everyone in western Canada is familiar with that situation, and people throughout Canada should be conscious of it, too, because as the income of western agriculture declines the whole economy of Canada suffers, and it can decline anywhere between $150 million and $200 million a year depending on the crop that is harvested. This is really the basic problem affecting agriculture.
I do not overlook the problem raised by several hon. members and by representatives of the farm organization with regard to the cost-price squeeze. That is a pressing and perplexing problem, and it has to be met in so far as it can be met. Nevertheless the basic problem is this one of the variability of income and I should like to indicate some figures with regard to it. We are familiar with periods of high income and periods of low income on the prairies and although technological improvements and marketing techniques have tended to reduce this variability, for the foreseeable future it will remain a feature of any western farm economy not rigidly controlled.
A comparison of income per farm over a period of years must recognize the fact that the average size of farms has been increasing rapidly and that the "statistical" average income of all farms is much less than that of bona fide commercial farms, as a result of

the inclusion of many very small farms in accordance with the census definition.
The average income per farm in the prairie provinces adjusted to constant dollars-1948-57 = 100-varied between $1,714 and $6,631 during the period 1935-57. The average for the period was $4,255 and in 1957 was only fractionally lower at $4,242. The pattern of the changes was one of rapid if sporadic, increase from 1935-52, followed by a fairly steady decline. However, even expressed in constant dollars, income per farm in 1957 was still one third above the 1935-44 ten year average.
Income per improved acre adjusted to a constant dollar	value-1948-57 = 100-also
varied widely during the period under review, from a low of $8.47 to a high of $22.96 per acre. In 1957 adjusted income per acre was $13 as compared with an average of $15.85 for the ten year period.
The average annual income per acre from wheat, adjusted to a constant dollar value- 1948-57 = 100-for the prairie provinces fluctuated between $10.91 and $33.02. The average for the ten years was $20.95 and for 1957 was $18.85.


John Whitney Pickersgill: I am rising on a point of order, Mr. Chairman. I refrained from making any comment on this vote but I, like my hon. friend from Burin-Burgeo, would have liked to point out that not only in agriculture but in the oldest industry of Canada, the fisheries, fluctuations in price of this character take place. What the minister is doing now is making a long academic discourse, and it seems to me to be quite out of order and unrelated to this item.


Gordon Minto Churchill: On the contrary, I am putting on the record facts, something which the hon. member for Bonavista-Twillingate has always strenuously avoided. He deals so much with theory and gets so aroused emotionally over various problems that it is difficult for him to deal with the facts of a situation, and that is exactly what I am dealing with on this occasion.


Lester Bowles Pearson: A point of order has been raised, and perhaps the minister could sit down long enough for it to be determined.


Charles Edward Rea: There is no question but that the Chair has allowed quite a lot of latitude this afternoon, but I think, that hon. members should come back to this item No. 663, because if the chair allows latitude to one it has to allow it to another.


Gordon Minto Churchill: There was considerable discussion with regard to the cost price-squeeze
Supp ly-A gr (culture
and all those other matters affecting the income of prairie farmers, and these points I have mentioned are related to that.


Charles Edward Rea: There was no objection raised when that happened, but now an objection has been voiced the Chair must bring members back closer to this particular item.


Gordon Minto Churchill: Mr. Chairman, it is extraordinarily difficult when the Chair is obliged to restrict a speaker after allowing so much latitude but I shall certainly respect the ruling. May I make a few comments with regard to marketings and exportings of wheat which are related to this problem. The hon. member for Assiniboia mentioned that and said that over the years marketings had remained very constant but may I point out that these marketings would not have remained at the high level at which they have been the last few years had it not been for a vigorously pursued export policy. That was dealt with by the Prime Minister who indicated that we had set a record this year of 317 million bushels of wheat for export of which 23 million bushels constituted an increase in our cash sales and 32 million bushels represented loans and gifts to the Colombo plan countries.
The suggestions for deficiency payments have run into enormous sums of money but it is sometimes overlooked that we are now expending a considerable amount of financial support. Let me just illustrate that. In this vote there is provision for $40 million. There were excess storage charges on wheat running between $35 million and $40 million. During the course of the last crop year approximately $50 million was expended by way of outright gifts or long term loans for the export of wheat. The payments for this year under P.F.A.A. may run between $25 million and $30 million. During the course of one year we have expended approximately $150 million to $160 million in support of western agriculture over and above the advantages that accrue from low freight rates on grain moving to our ports.
The long range program is part and parcel of this vote which we are considering today. In conclusion I would suggest that in that the essential and most important factor is to press on with an export program with respect to wheat that will reduce the surplus that has been hanging over our heads in this country for some time. That surplus was reduced during the course of this crop year by over 100 million bushels of wheat and in the coming crop year it may be reduced by an equal amount or more. However, we will still be left with a considerable surplus of wheat in Canada. Unless that surplus of

Ways and Means
wheat is moved there cannot be marketings and deliveries by farmers to the elevators and hence there will be a reduction in the income of the individual farmer.
By and large our program and this assistance is aimed at assisting the smaller farmer in western Canada who deserves that type of assistance and who will constantly receive the sympathetic attention of this government.


[Stage Direction]
Item agreed to.
Charles Edward Rea: That completes the estimates.
Resolutions adopted in committee of supply this day reported and concurred in.



WAYS AND MEANS

Donald Methuen Fleming: that the house go into committee of ways and means.
Motion agreed to and the house went into committee, Mr. Rea in the chair.


Donald Methuen Fleming: That towards making good the supply granted to Her Majesty on account of certain expenses of the public service for the fiscal year ending March 31, 1959, the sum of $1,898,604,644.89 be granted out of the consolidated revenue fund of Canada.


[Stage Direction]
Motion agreed to.
Resolution reported and concurred in.
Mr. Fleming (Eglinton) thereupon moved for leave to introduce Bill No. C-61, for granting to Her Majesty certain sums of money for the public service of the financial year ending the 31st March, 1959.
Motion agreed to, bill read the first and second times and the house went into committee thereon, Mr. Rea in the chair.
On clause 1-
John Whitney Pickersgill: Mr. Chairman, what is the total amount? Will the minister tell us that?


Donald Methuen Fleming: Yes, Mr. Chairman. The total amount provided for by this bill is $1,898,604,644.89. It is the amount appropriated now, the three earlier appropriation acts for the fiscal year 1958-59 having already appropriated sums totalling $1,866,884,889.11, making a grand total of appropriations including the main, supplementary and further supplementary items of $3,765,489,534.00.


[Stage Direction]
Clause agreed to.
Clauses 2 to 5, inclusive, agreed to.
Schedules A, B and C, inclusive, agreed to.
Preamble agreed to.
Title agreed to.
Bill reported, read the third time and passed.

John George Diefenbaker: Mr. Speaker, I wonder if the house would allow me to make a suggestion at this time. In view of all the circumstances, if the house is agreeable, prorogation could take place at eight o'clock this evening. That could be achieved by simply adjourning at the conclusion of whatever business remains provided the membership of the house will consent. I am merely placing this suggestion before the house at this time to the end that we might be able to arrange for the presence of the representative of the Governor General for prorogation.


Lester Bowles Pearson: So far as the opposition is concerned, I hope we can arrange the remaining business of the house to make that possible. We shall try to ensure that our criticism from now on is not carping.


Mr. Speaker:: I take it there is unanimous consent that the house will continue with government orders until they have been completed, then rise until eight o'clock, if there is any interval, and reconvene at eight o'clock in the chamber.


Some hon. Members:: Agreed.



CANADIAN CITIZENSHIP ACT


Hon. Ellen L. Fairclough (Minister of Citizenship and Immigration) moved: that the house go into committee to consider Bill No. C-58, to amend the Canadian Citizenship Act.
Motion agreed to and the house went into committee, Mr. Rea in the chair.
On clause 1.


John Whitney Pickersgill: Mr. Chairman, I should like to make one or two very brief general observations on clause 1. When the bill was before the house for second reading, as Your Honour is aware, I sought to move an amendment to the second reading of the bill which Your Honour ruled out of order on the ground that it was anticipating the committee stage. In order to save time I should like to give notice now that when we come to clause 2 I propose to move an amendment in committee in which I shall seek to accomplish what Your Honour told us from the chair could be accomplished in committee, because I understood that to be the sense of Your Honour's ruling.
But I should like to say that we voted against second reading of the bill for two reasons. First, although it appears on the surface to move a long way, and it has moved somewhat in the direction we think it ought to go, towards giving equality of status to

naturalized citizens with natural born citizens, we think it should go the whole way or that it is not worth doing at all. Second, although when the hon. lady moved second reading she told us that she intended to strike out subparagraph (c) of clause 2 of the bill, that of course had not been done at the time of second reading and we were voting on the bill as it was before the house and we did not feel that we could vote for a bill containing that clause, with the interpretation that we placed upon it. I believe that the hon. member for Cartier wishes to make an observation or two on clause 1.


Mr. Crestohl:: Mr. Chairman, I want to address myself to the use of the word "intend" in the bill because I think it has some very significant connotations which perhaps are not very obvious at first sight. I was pleased to hear the minister say that she would withdraw subparagraph (c) of clause 2 because it does use the word "intend" and, as the minister said, it is really difficult to risk using the word "intend" because it might be misunderstood. It is difficult to know what a person intends. You do not know what is in that person's mind and you cannot base any conclusions on it. The minister was quite right in saying she would withdraw subparagraph (c) of clause 2 which now reads as follows:
The governor In council may, in his discretion, order that any person other than a natural born Canadian citizen shall cease to be a Canadian citizen it, upon a report from the minister, he is satisfied that such person...
(c) did not, at the time of taking the oath of allegiance set forth in the second schedule, intend to comply with such oath.
As I say, I agree wholeheartedly with the minister that it is difficult to know what a person intends at a particular time. We also find the word "intend" in subsection 1 of section 10 of the act which reads as follows:
The minister may, in his discretion, grant a certificate of citizenship to any person who is not a Canadian citizen and who makes application for that purpose and satisfies the court that-
Then there are about ten items and I do not intend to read them all because I want to save the time of the committee. With the exception of the last one they are all palpable and factual so that the court can at the time know the fact that the applicant has complied with each one of these items. I will refer to two or three for illustration only. The court can know, under subparagraph (a), that the applicant has attained the age of 21. Proof of that can be made. Under subparagraph (b) the court can know that he has resided in Canada for a period of at least one year. Proof of that can be made. Under paragraph (c) proof can be made that he has acquired Canadian domicile, and so on down the line. But 57071-3-301
Canadian Citizenship Act then we come to the last subparagraph and we see that the court must be satisfied that he intends to have his place of domicile permanently in Canada.
In clause 1 of the bill now before us we see that the words "intends to comply with the oath of allegiance set forth in the second schedule" are used. The minister has rightly withdrawn subparagraph (c) of clause 2 and I see no reason for the retaining in the legislation of the words "intends to comply with the oath of allegiance." It is very nebulous and it does not fall into the same category of factual items that can be proven to the court. I regard this as a somewhat dangerous provision to add. The minister has deleted a great many of the obstacles that existed in the previous act by bringing forward this bill. But I think there is a catch. I do not say that the minister intends it to be so but I think there is a catch when after the applicant has complied with all other requirements you provide that the court must also be satisfied that the applicant intends to comply with the oath of allegiance.
That is not a factual thing and it is difficult to know at any time whether the person intends to comply. Someone will have to judge that. Someone will have to read the applicant's mind at the time. Does he intend to comply? By simply saying, "I do not think he intends to comply", I say that whoever will be in that position will be able to nullify all the factual requirements already complied with by the applicant. I respectfully submit to the minister that this addition is not necessary. It adds nothing to the legislation and it creates a problem because someone will have to read the applicant's mind. He may then say, "I do not think you intend to comply" and thus nullify all the other factual requirements.


John George Diefenbaker: May I ask the hon. gentleman a question? Would there not be the same proof required as there would be in respect of the earlier subsection to which he made reference-that the applicant intends to have his place of domicile in Canada? The individual applying for naturalization will be asked, "What do you intend to do"? He says, "I intend to stay in Canada; my plan is to remain here and establish a domicile." Is not intent in this case the same, something which has to be determined by the surrounding circumstances at the time as necessary to be established before it could in any way be determined?


Leon David Crestohl: The Prime Minister is quite right, but I think that the word is superfluous in that clause.


John George Diefenbaker: But it has been there for a long time.

Canadian Citizenship Act


Leon David Crestohl: He must first of all prove factually that he has lived in Canada over a number of years; that he has a domicile in Canada.


John George Diefenbaker: That he intends to.


Leon David Crestohl: A man can say I intend to do so; quite right. However, when the granting of citizenship is going to depend upon whoever will sit in judgment saying, I do not believe the intention, that is a danger spot. It is very dangerous authority to place in the hands of someone, to judge whether an applicant who has complied with countless requirements should then have his application refused because that person will say, I am not quite sure you intend to keep the oath that you are taking. I think that is a very dangerous clause, and I do not believe it adds any prestige to the act. I do not think it is a fact which anybody could possibly prove or disprove, as to what a. person's intent may be. After you have satisfied all the requirements, your hope of citizenship may be washed away because someone will say, I do not believe you intend to follow the oath. Who is the mind reader who will be able to draw that conclusion to nullify the application?


John George Diefenbaker: Who is the mind reader who determines the question of intent as to domicile?


Ellen Louks Fairclough: I think the hon. member for Cartier attacks this thing from a peculiar position. This word "intends" in this particular clause is not at all the same as in the clause which we propose to remove. It must be taken in conjunction with the final wording in subsection (1) of section 10 which says that the applicant, amongst other things, should satisfy the court about a great many things. I draw the hon. member's attention to the words in paragraph (d) which says that he must be of good character. I ask the hon. member, how does one prove that one is of good character? It is probably easy to prove you are not of good character. You could probably have evidence of being a bad character, but I doubt that you could really produce evidence to prove that you are of good character. Again, therefore, it is a case of what is in a person's mind. When you ask a person to prove that he is of good character or to satisfy the court that he is of good character, I think it is quite proper that you should ask him also to satisfy the court about other things. Has he the intention to live a proper life in this country, to stay in this country?
I cannot get too excited about a person who has attained the position in life where

he has been appointed a judge in our courts misinterpreting the examination or conversation which he may have with a prospective citizen. I submit, Mr. Chairman, that if you are not going to have some such safeguard, if you are not going to signify to the judge the type of examination which you hope he will make of applicants for citizenship, you may just as well grant the applicant his citizenship without any examination whatever. You may as well grant it merely because he applies for it and has been in the country the requisite number of years. You may say, very well, you have been here for five years and now if you wish to be a Canadian citizen we are not going to ask you what your intentions are, we are not going to ask you whether you intend to live in this country, whether you intend to apply for a passport and then leave this country. There are a great many angles to it. I submit, in all sympathy with the hon. member's concern, that this is a matter for the judges in the courts to decide, as they have done in the past. This is merely an indication to the judges that we hope they will be careful in awarding citizenship to these applicants.


Leon David Crestohl: May I point out to the minister that I do not believe the comparison is a good one in so far as proving good character is concerned. Certainly, before a man's application is considered it is carefully investigated by our security officers. Reports are obtained from all the courts as to whether or not this man has a criminal record. Security officers investigate everywhere, and these facts are placed before the judge. The judge has factual evidence.
This is the only item in twelve requirements that is not factual, but upon which one has to rely by just guessing. May I point out to the minister also that if this were left to a judge perhaps some cure might be obtained, but sometimes these things are not done by a judge. They are done by a minister, by a deputy minister or by departmental officials. If one simply says, I do not think that this man will keep his oath of allegiance, that is sufficient to disqualify him from citizenship. I think that is a barrier that is difficult to overcome. It should not exist in a piece of legislation. As the hon. member for Bonavista-Twillin-gate said the other night, we want to eliminate policing the mind, and this approaches an attempt to police one's mind. If you say that a man will not qualify for citizenship, not on the ground of facts but on one's thoughts, that is a very dangerous thing.


[Stage Direction]
Clause agreed to.

On clause	2-revocation of Canadian
citizenship.
John Whitney Pickersgill: I should like, if the hon. lady would allow me, to move an amendment-


An hon. Member:: The minister has the floor.


John Whitney Pickersgill: All right; it will just complicate things.


Ellen Louks Fairclough: I am sorry there is a misunderstanding here. I indicated before that when clause 2 was being considered I intended to move an amendment to the house. I think the committee was well aware of this intention. I shall, therefore, ask my colleague the Minister of Agriculture to move:
That Bill C-58, an act to amend the Canadian Citizenship Act, be amended
(a)	by adding the word "or" at the end of line 25 thereof,
(b)	by striking out the word "or" at the end of line 28 thereof, and
(c)	by striking out lines 29, 30 and 31 thereof.


Douglas Scott Harkness: I so move, Mr. Chairman.


John Whitney Pickersgill: Could the hon. lady say what the effect of that amendment is?


Ellen Louks Fairclough: It is to eliminate clause (c) of the proposed subsection (1) of section 19.


[Stage Direction]
Amendment agreed to.
John Whitney Pickersgill: I indicated earlier that I intended to move an amendment. Since the occupant of the chair has changed since I last spoke, I would just recall that last evening on second reading I sought to move the following amendment:
That all the words after the word "that" be struck out and the following substituted therefor:
"This house declines to give second reading to this bill because it fails to provide that naturalized citizens shall have equality of rights and status with natural born citizens."
I will not trouble to read the Speaker's ruling on that amendment when it was ruled out of order-you have no doubt acquainted yourself with it-on the ground that it would anticipate amendments which could be moved in committee. I may say that I had not thought, until the Speaker gave that ruling, that it would be possible to make an amendment in committee that would achieve that object. But Mr. Speaker having directed my mind in that direction, I applied my mind to it and I think Mr. Speaker has proved to be right. I have an amendment which does, in fact, achieve the objective which the Speaker told us could be achieved in committee. Therefore without more ado I will move as follows:
That section 2 as amended be amended by striking out all the words after "19. (1)" in line 12 to 57071-3-30Ii
Canadian Citizenship Act the end of the section and substituting the following therefor:
" (a) A Canadian citizen other than a natural bom citizen shall not lose his citizenship for any cause for which a natural born citizen would not lose his citizenship.
(b) Where it is established to the satisfaction of the court that a person has obtained a certificate of naturalization or Canadian citizenship by false representation or fraud or by concealment of material circumstances such certificate shall be revoked and such person shall be deemed never to have been a Canadian citizen."
In support of this amendment I should like to say that the (a) part of it makes it quite clear that once a person has become a naturalized citizen he has exactly the same status as does a natural born citizen and that he cannot lose-that, of course, is indicated in the act in every other respect except one-he cannot lose his citizenship for a cause for which a natural born citizen could not lose his citizenship.
Then in section (b) I applied my mind in the direction in which I indicated last night in an aside to the Minister of Justice I thought it might be applied; that is to say, taking the analogy of nullity as opposed to divorce. It is clear that what is meant in the proposed bill and what is intended is that if a certificate of naturalization or citizenship is acquired by fraud or misrepresentation of the material circumstances, the person who obtained it never was a citizen. What this amendment says is that he never was a citizen and that the certificate was not a valid certificate. I am not a lawyer and I do not know too much about these things, but I would suppose that if someone obtained a birth certificate by fraud and it was found that it was fraudulent, he would no longer be a natural born citizen of Canada.


Edmund Davie Fulton: You could not very well say you had never been born.


John Whitney Pickersgill: No.


Edmund Davie Fulton: That is what you are trying to say here.


John Whitney Pickersgill: No. What I am saying here is that he never was a citizen because he did not comply properly with the law that he is required to comply with to become a citizen. The only difference between what I am suggesting and what the hon. lady is putting forward in her bill, now that she has taken out that highly objectionable section (c) which really would have instituted thought police in so far as these naturalized citizens were concerned, is that it will no longer be competent to revoke the citizenship of the person who has been charged with the offence of treason, is outside the country and does not come back to be tried.
That is the sort of thing that happens once in a great while. It is perhaps desirable to

Canadian Citizenship Act be able to do this. However, if we are going to take away all the other reasons, why leave this one? The main purpose of this whole exercise, as I take it-and I think the house is not divided on this point any longer-is to give complete equality, the psychological feeling of equality. If a natural born person is a traitor, we cannot divest him of his citizenship. Therefore are we really going to be losing very much if once in a generation there happens to be a naturalized person who is charged with treason and is outside of Canada and whom we cannot strip of his citizenship? It does not seem to me that the country is going to suffer very much compared with what we are trying to do in this legislation. In other words, we are trying to give to the naturalized citizens of this country a feeling that once they are naturalized they are equal of the natural born citizens.
I think I have made my point and I do not want to trespass further on the time of the committee. I have tried to make this suggestion in a completely non-controversial way because I think all of us are looking to the achievement of the same objective. I may say that if the Minister of Justice finds any technical defect in the amendment, I should be happy indeed to yield to his very much superior knowledge of these matters in making any textual changes in it. But I would hope that in principle it would be acceptable to the government.


Ellen Louks Fairclough: I am sorry to say that this amendment which is proposed by the hon. member for Bonavista-Twillingate is not acceptable. I think that one of the things we hope our new citizens will acquire, along with their citizenship, is a pride in that citizenship. I think they realize when they take the oath of allegiance that by so doing they owe that allegiance to the crown and that having done that voluntarily they must abide by the oath they have taken. Unlike the natural born Canadian, the naturalized Canadian is a person who comes to this country owing allegiance to a foreign power. On acquiring Canadian citizenship a naturalized person, by his very act, deliberately forsakes his allegiance to the foreign power and by oath gives his allegiance to the crown. If that person chooses then, in deliberate violation of his oath, to do acts which lead to his being charged with treason, surely it is not expecting too much that he will return at least voluntarily to answer to charges before the court. The natural born person on the other hand automatically owes allegiance to the crown from birth. If by his deliberate act he declares allegiance to a foreign power, he thereupon loses his Canadian citizenship also. Mr. Chairman, I do
[Mr. Pickersgill.l
not want to prolong this debate. This is a point on which I feel rather strongly. I am sorry, but I cannot accept the hon. member's amendment.


Leon David Crestohl: I should like to ask the minister a question. The minister speaks in terms of a naturalized citizen who has committed an offence, leaves the country and does not come back for trial and therefore should lose his citizenship. I agree with that. But assuming that a natural born citizen also commits the offence, also leaves the country and also does not come back to trial, why treat him differently from the way in which you treat a naturalized citizen? He has committed the same offence. He has left the country the same as has the naturalized citizen, and he does not come back for trial. They are both on an equal footing. They have done the same thing. Why differentiate as between the one and the other?


Joseph Pierre Albert Sévigny: Is the committee ready for the amendment?
Amendment (Mr. Pickersgill) negatived: Yeas, 17; nays, 55.


[Stage Direction]
Clause agreed to.
Clause 3 agreed to.
Bill reported.
Ellen Louks Fairclough: the third reading of the bill.


Lester Bowles Pearson: Before the bill passes, Mr. Speaker, there are one or two observations I wish to make. We moved an amendment which was ruled out of order but we were told it could be moved in committee, which was done. More important, however, we could not vote for a bill which included section 19(c). True, the minister indicated that this objectionable clause would be removed, but it was there when we were asked to vote and therefore we could not support second reading.
However, that section has now been removed and, as this bill does go some distance, though not as far as we think it should go, towards achieving the objectives we have in mind, we will vote for it on third reading.
Motion agreed to and bill read the third time and passed.



BROADCASTING


Hon. George C. Nowlan (Minister of National Revenue) moved: the second reading

of and concurrence in amendments made by the Senate to Bill No. C-55, respecting broadcasting.


John Whitney Pickersgill: Would the minister please tell us what are the amendments?


George Clyde Nowlan: There are two amendments to the bill, one dealing with the section about Canadian interest or ownership. It never was the intention to interfere in any way with stations which already held a licence, and there is at least one of these stations, and possibly more, which because of the fact that their shares-namely the shares of a particular company operating a radio station-are owned by a company the shares of which are listed on a stock exchange that it might be impossible from time to time to establish the fact that they are 75 per cent Canadian controlled. The bill was therefore amended in the Senate as a result of inquiry made by the senators and I appeared before them and after discussing the matter I realized there was the possibility of some prejudice against two or three stations presently in operation in this country. I therefore agreed to this amendment.
The other amendment is one to which reference was made during debate to the effect that the president and vice-president of the Canadian Broadcasting Corporation should hold office during good behaviour rather than for seven years.


Lester Bowles Pearson: The two amendments to this bill mentioned by the minister are quite acceptable to us. The first amendment, which will prevent any interference, is something which should be approved. So far as the second amendment is concerned, this is in exactly the same terms as we advanced in this house when we were discussing that part of the bill, and we naturally support it. I cannot, however, refrain from expressing my disappointment and that of my colleagues that we were not as persuasive in our advocacy of this change as were the senators. I do not want to mention at this late stage consideration of high constitutional principles in the relationship between the House of Commons and the Senate, but it is regretted that the amendment put forward in the house by us was rejected while the same amendment put forward by the Senate was accepted. With these few observations I wish to express on our part the acceptance of the amendment which we believe will improve the bill.


George Clyde Nowlan: It was the persuasion of the hon. member in the house which, I am sure, laid the groundwork for the amendment from elsewhere.
Broadcasting


Hazen Robert Argue: We have no objections to the amendments before us but we do feel, as parliament feels, that Canadian broadcasting should be in the hands of Canadian corporations. I realize that this amendment as it has been explained would mean that great hardship on these two or three particular stations might be avoided, but I wonder whether, if these stations should apply for an expansion of their privileges, such as an increase in their power and other facilities-in other words, if they should appear before the board asking for an extension of their power-they would then find themselves in a different position. I think it is one thing to say we will not interfere with them in their existing form but there is some difference as to the procedure which might be followed if they ask for an extension of power for their station, and so on.
I am wondering if the minister in a few words could tell us the intention with regard to that particular subject. Will it be considered in the very broad terms of this amendment which allow the governor in council a great deal of leaway in laying down the conditions?


George Clyde Nowlan: I cannot, of course, speak for the board of broadcast governors as to what they might do in a specific case. Each application would depend on the circumstances, as the hon. member knows. All I can say is that the companies which appeared before the Senate committee and presented their arguments were perfectly satisfied with this amendment which was brought about in conjunction with the companies as between the Senate and the Department of Justice. I am sure that the circumstances in each particular case will be taken into consideration. There are only four as far as we know that could be affected, and their interests will be safeguarded.


Hazen Robert Argue: Would the minister care to give the house the names. If he would prefer not to do so-


George Clyde Nowlan: There would be no objection. I think there is one station in Toronto, another in Montreal and possibly one in Windsor. Frankly I have forgotten where the other two stations are.


[Stage Direction]
Motion agreed to, amendments read the second time and concurred in.

Howard Charles Green: Before the sitting is suspended I should just like to say a word in my capacity as leader of the house by way of thanks to both the opposition parties and in particular to the hon. member for Laurier (Mr. HOUSE OF COMMONS
House of Commons
Chevrier) and the hon. member for Assiniboia (Mr. Argue) for the co-operation they have shown throughout the session.
I suppose we sometimes think that many harsh words are said across the floor of the house, words that are very rude and which perhaps we regret-I am speaking for members on both sides, now, not only for those who happen to support the government. It may be of some comfort and encouragement to hon. members if I tell them that some weeks ago one of the representatives here from another commonwealth country told me he believed that the Canadian House of Commons was the most polite democratic assembly in the world, and he said the debates were in far better temper and conducted in an atmosphere of far more friendliness than in any other democratic parliament. That may or may not be true. However, I have great confidence in his judgment.
In any event, Mr. Speaker, it is very true that there has been a very good spirit in the house throughout the session. I think we shall all go back to our homes in different parts of Canada tonight, tomorrow or next week feeling that we have made many new friends during this session and that we have renewed old friendships, and this is the spirit in which a democratic country is best governed. For my part I should like to express thanks to the members of both the opposition parties.


Lionel Chevrier: Mr. Speaker, when the leader of the house caught your eye a moment ago I was also rising and for a similar purpose: to express our thanks to the house leader for the manner in which he has conducted the business of this house during the session. I want to express our thanks to him for his co-operation and for his understanding, because at all times I have found that co-operation has existed to the highest degree. He has fulfilled the task which the government has given to him with competence and efficiency and it is appreciated on this side of the house.
I should not like to see the house prorogue without at the same time expressing on behalf of the official opposition our thanks to you, Mr. Speaker, for the manner in which you have presided over our deliberations. I had occasion to say this at a previous session and I am only too pleased on this occasion to repeat that you have shown fairness and equity in your capacity as Speaker of this house, and those of us who sit on the opposition benches appreciate it to the fullest extent.
(Translation):
Mr. Speaker, I feel I should say something with regard to the Deputy Speaker of the House (Mr. Sevigny). The way in which he IMr. Green.]
has acquitted himself of his duties as such came as no surprise to us. He has done so not only with competence but also with great courtesy, following thereby in the footsteps of his distinguished father. I am pleased to express our thanks to him.
I would also like to avail myself of this opportunity to express my sincere thanks to the leader of the house.
(Text):


Hazen Robert Argue: It would appear in order for me at this time to apply for membership of this newly established mutual admiration society. I am pleased to agree with the remarks that have been made as to the very fine co-operation we have received from the leader of the house in arranging the business during this session. To many of us he is a friend of long standing, and it is a pleasure to work with him in his new capacity. We have been fortunate in the person who has been the leader of the house in previous years, but I do not think we have ever had a better relationship, better understanding and closer working relationship than we have had with the present house leader.
I realize that from time to time members in various quarters of the house may have been impatient about the length of the speeches and the length of the session, but in relation to the work which has been done, this session has been one of the shortest in the history of Canada. It has been a session in which we have passed the largest number of estimates, and we have also passed a great many bills. I think the government and its members have given a spirited defence of the legislation which they have presented, and in the tradition of the opposition we think we have presented constructive criticism, constructive alternatives and, when necessary, firm opposition against certain acts and certain legislation.
I also wish to agree most wholeheartedly with the remarks which have been made about Your Honour. We in this group are closer to you, at least geographically, than any other party in the house and I think that has been a real advantage for us. We have come to know Your Honour better and to realize your very good qualities. I said in the last parliament that you had proceeded fairly and had meted out the rules in an equitable manner to all members. I want to say on behalf of the C.C.F. group that you have maintained in our minds the great prestige that you had in the last parliament and we look forward to a continuance of this very fine relationship for the good of the Canadian nation in the years ahead.
Right Hon. J. G. Diefenbaker (Prime
Minister): Mr. Speaker, I do not intend to
delay the house. I shall simply say that the

epitome of parliamentary government is the relationship that has been evidenced here during the session and more particularly in these last few moments when each of us speaks as he feels. I do not want to say more than that I believe in this session we have endeavoured to carry out to the highest degree possible the parliamentary system, with the realization that while the government has a large majority at no time has it endeavoured intentionally to bring about a denial of that equality of opportunity which is of the essence of our system.


Harold Edward Winch: And I thought all the time we were fighting!


Mr. Speaker:: May I say on behalf of myself and, if I may, on behalf of the Deputy Speaker and chairman of committees and also the deputy chairman of the committees of the whole, how deeply we appreciate what has been said by hon. members. I am all too conscious of my own deficiencies. I am bound to err and even when I am right I am bound to give offence to one side or the other. Therefore I deeply appreciate the fact that you will tolerate me to the extent you have.
I should like to take this opportunity of saying I hope to see all hon. members before they leave and immediately after we rise I hope that all hon. members will enter the door of room 16 which is wide open and that those who cannot come then will perhaps come after prorogation. Thank you very much indeed.


Charles Edward Rea: Perhaps I may be allowed to thank hon. members for the co-operation I received when I was sitting in the chair because at times there were rather difficult and borderline rulings to make.
I should also like to express my thanks to the three clerks for their kindness, patience and the very excellent words of wisdom they offer to those who will listen.
May I also be the first to wish all hon. members a merry Christmas.


Joseph Pierre Albert Sévigny: I should like to join Mr. Speaker and add my own thanks to those expressed by the deputy chairman for the kind reception you have given to my somewhat novice decisions during the current session. I owe a great debt of gratitude to you all for your forbearance, to Mr. Speaker for his guidance and to the clerks for all the guidance they gave. I may have been wrong at times and when I was duly corrected it was always quite pleasant. I surely consider it an honour to have presided over the committees during this session.
The Royal Assent (Translation):
I wish to thank the hon. member for Laurier (Mr. Chevrier) and all those who a moment ago showed by their applause their appreciation of such services as I might have rendered during this session. You may rest assured that at all times I appreciated the co-operation of Mr. Speaker and that of hon. members. Thanks to their advice and their encouragement, I have been able on occasion to improve my rulings.
(Text):


Herbert Wilfred Herridge: Mr. Speaker, I just want to say briefly that the kindly references made by the leader of this group to yourself are extended also to the Deputy Speaker, the deputy chairman of committees, the officials of the house, and with respect to the kindly references he made to the government side of the house, and in order to avoid any misunderstanding, I want to say I do not want government members to assume that we think we are burying the government.
At 6.26 p.m. the sitting was suspended until 8.00 p.m. this day.



SITTING RESUMED

[Stage Direction]
The house resumed at eight o'clock.

Mr. Speaker:: The Royal Assent
An act for the relief of Barbara Golebiowski Lorens.
An act for the relief of Nicholas Vogel.
An act for the relief of Viola Mary White Witt.
An act for the relief of Joseph Lucien Roland Richer.
An act for the relief of Marc Baillargeon.
An act for the relief of Lucille Perrin Ballard.
An act for the relief of Barbara Rae Lynch Harding.
An act for the relief of Estelle Leblanc Hebert.
An act for the relief of Georgiu Panajtiotis Yarenis.
An act for the relief of Shirley Watson Pennoyer.
An act for the relief of Anastasia Gorshko Hruby, otherwise known as Ann Gorshko Hruby.
An act for the relief of Edwin Showier.
An act for the relief of Nikolaj Kurdiaszow.
An act for the relief of Johann Schneider.
An act for the relief of Lise Beaudry Livingston.
An act for the relief of Beverley Georgina Berry Turpin.
An act for the relief of Shirley Eileen Ferris MacTavish.
An act for the relief of Maurice Turcotte.
An act for the relief of Christina Maxwell Biggs Sanderson.
An act for the relief of Thomas Patrick Heavers.
An act for the relief of Josephine Gertrude Rice Thornhill.
An act for the relief of Ruth Gruber Sosnowsky.
An act for the relief of Samuel Wasserman.
An act for the relief of Celia Bernhaut Jamensky.
An act for the relief of Mary Elizabeth Rains-borough Archer Rudner.
An act for the relief of Waldo John Brayton.
An act for the relief of Jean-Paul Camire.
An act for the relief of Evelyn Zigayer Sedawey.
An act for the relief of Eleanor Wanda Leshynska Ross.
An act for the relief of Irene Rondeau Desbiens.
An act for the relief of Victor Petrashevics.
An act for the relief of Joseph Adrien Octave Guillotte.
An act for the relief of Jeannette Jaslow Feifer.
An act for the relief of Edith Rosen Browman.
An act for the relief of Paul-Emile Papineau.
An act for the relief of Joan Patricia Gatien Juzenko.
An act for the relief of Myrto Mona Diane Chevrette Cadieux.
An act for the relief of Andrzej Skarzynski.
An act for the relief of Otto Zilkalns.
An act for the relief of Leo Milette.
An act for the relief of Angelina Di Battista Overland.
An act for the relief of Robert Herman Kashower.
An act for the relief of Evelyn Mills Miles.
An act for the relief of Margaret Alguire Kernaghan.
An act for the relief of Georges Albert Hetu.
An act for the relief of Francisca Catharina Sanders Simard.
An act for the relief of Yolande Robert LeBel.
An act for the relief of Joseph Anthime Roland Bock.
An act for the relief of Clarence Joseph Reilly.
An act for the relief of Elizabeth Christina Law MacNab.
An act for the relief of Frank Joo.
An act for the relief of Eileen Annie Elizabeth Stonebridge Hopkinson.
An act for the relief of Giuseppe Fusari.
An act for the relief of Jean Adolophe Abel Mathys.
An act for the relief of Catherine Regina Hearn Cullen.
An act for the relief of Richard Cloutier.
An act for the relief of James Nelson LeBlond.

An act for the relief of Louise Auger Lecavalier.
An act for the relief of Marie Noella Therese Legault Lebel.
An act for the relief of Muriel Marguerite Elizabeth Ada Brant Yeaman.
An act for the relief of Marie Becherbleith Reicher.
An act for the relief of John Charles Underhill.
An act for the relief of Patricia Wirth Usher.
An act for the relief of Jean Audrey Vickers Mastro.
An act for the relief of Mary Rebecca Lafontaine Johnson.
An act for the relief of Jetti Edelstein Popowski.
An act for the relief of Jean Philippon.
An act for the relief of Sidney Schwartz.
An act for the relief of Barbara Crawford Bucci.
An act for the relief of Holger Madsen.
An act for the relief of Miriam Astrof Hymovitch.
An act for the relief of Margaret Welsh Clark Gray Perego.
An act for the relief of Eunice Joyce Stone Berwick.
An act for the relief of Rita Elizabeth Edwards Bryant.
An act for the relief of Mary Farrelly Crane.
An act for the relief of Margaret Eileen McKenzie Beauchemin.
An act for the relief of Jeanette Josephine Cools Cox.
An act for the relief of Geraldine Marilyn Woods Spencer.
An act for the relief of Mariette Giselle Denise Pesant Forget.
An act for the relief of Joy Diedre Shelley New.
An act for the relief of Muriel Ethel Serchuk Rutenberg.
An act for the relief of Deborah Barash Dindzik, junior.
An act for the relief of Gladys Elsa Hannah Birnbaum Aston.
An act for the relief of Giulietta Marcogliese Iacurto.
An act for the relief of Herbert Budd, junior.
An act for the relief of Dorothy Mary Shrimpton Legault.
An act for the relief of Maria Giuseppa Di Nunno.
An act for the relief of Marie Jacqueline Fer-nande Belisle Wechselberger.
An act for the relief of Simonne Fournier Bergeron.
An act for the relief of Cecily Anne Maud Carter Bernard.
An act for the relief of Marie Henriette Andree Massue Prevost.
An act for the relief of Lovell Orville Woodard.
An act for the relief of Joseph Wing.
An act for the relief of Hilda Jamesie Hatfield Carter.
An act for the relief of Evelyn Mae Wood Snell.
An act for the relief of Robert Smith.
An act for the relief of Ethel Fisk Gwynne-Davies.
An act for the relief of Marie Reine Drouin Milliard.
An act for the relief of Joseph Leonidas Albert Paradis.
An act for the relief of Hyman Wexler.
An act for the relief of Natasha Harpf Cray ter.
An act for the relief of Shirley Bertha Marietta Birrelle Wilson.
An act for the relief of Norma Elizabeth Gammie Costigan.
An act for the relief of Merita Helen Gertrude Alarie Russell.
An act for the relief of Sydney Clarence Walker.
An act for the relief of Barbara Anne Young McFadden Pallett.

An act for the relief of Jean Mercidus Cecilia Steel MacDonald.
An act for the relief of Arthur Thomas Hazell.
An act for the relief of Iris Olive West Dion.
An act for the relief of Margaret Cox Lafortune.
An act for the relief of Gertrude Falkenstein Garfield.
An act for for the relief of Angela Bertha May Cohen Weinstein.
An act for the relief of Rosanne Dolimont Ruelokke.
An act for the relief of Jeannette Hatsedakis Haeck.
An act for the relief of Natan Grunstein.
An act for the relief of Hedwig Papp Witwitzki.
An act for the relief of Adrienne Menard Huot.
An act for the relief of Martha Ratelle Holtken.
An act for the relief of Joseph Ovila Maurice Valentyne.
An act for the relief of Gweneth Vera Payne Smith.
An act for the relief of Raymond Leslie Larocque.
An	act	for	the	relief	of	Gordon Kent Lambert.An	act	for	the	relief	of	Catherine Doris Dooley
Bantey.
An act for the relief of Monica Frances Fleice Bottomley.
An	act	for	the	relief	of	Fritz Drechsler.An	act	for	the	relief	of	Robena Sarah Florence
Worrell Day.
An act for the relief of Gerald Leonard Pilcher.
An act for the relief of Mary Madeleine Dorothy Butler Meaney.
An act for the relief of Libusa Franic Kotow.
An act for the relief of Sheila Estelle Rosenstone Lane.
An act for the relief of Renald Leroux.
An act for the relief of Pierrete Beauregard Ifould.
An act for the relief of Marion Brooks McConnell Bienvenue.
An act for the relief of Patricia Alleyn Burstall Corrigan.
An act for the relief of Charles Athol Gordon.
An act for the relief of Margaret Canuel Fraser.
An act for the relief of Jean Dick Joslin.
An act for the relief of Halbert James Haldane Kerr.
An act for the relief of Mary Thelma Bourgeos Gaudet.
An act for the relief of Jacques Gerardin.
An act for the relief of Yolande Charron Fiorucci.
An act for the relief of Fernand Larouche.
An act for the relief of Mary Pelly Osborne.
An act for the relief of Leonard Lowrey.
An act for the relief of Josette Lacaille Johnston.
An act for the relief of Iona Gertrude Mary Adcock Dolphin.
An act for the relief of Maurice William Miller.
An act for the relief of Margit Szilagyi Rojzskies.
An act for the relief of Rita Jeanne Landry Benoit.
An act for the relief of Maria Eva Dorothe Deziel Lefebvre.
An act for the relief of Violet Mary Ward Gravel.
An act for the relief of Jean Phyllis Fensom Kell.
An act for the relief of Louise Giguere Boisvert.
An act for the relief of Barbara Janet Dillane Barr.
An act for the relief of John Shaw Macneill Carson.
An act for the relief of Freda Levine Schubert.
An act for the relief of Kenneth Herbert Gregory.
An act to amend the Penitentiary Act.
An act to incorporate the lakehead harbour
commissioners.
An act respecting Trans-Mountain Oil Pipe Line Company.
The Royal Assent
An act to incorporate Canadian Women's Press Club.
An act to amend the Loan Companies Act.
An act to amend the Trust Companies Act.
An act to amend The Returned Soldiers' Insurance Act.
An act to amend the Children of War Dead (Education Assistance) Act.
An act to provide for the conditional liberation of persons undergoing sentences of imprisonment.
An act to amend the Emergency Gold Mining Assistance Act.
An act respecting The Burrard Inlet Tunnel and Bridge Company.
An act to amend the Veterans Insurance Act.
An act to amend the Financial Administration Act.
An act to authorize certain amendments to the agreement made under the Maritime Coal Production Assistance Act with The Dominion Coal Company, Limited.
An act respecting Stanmount Pipe Line Company.
An act to amend the Customs Tariff.
An act to amend the Excise Tax Act.
An act to amend the Income Tax Act.
An act to authorize the construction of a bridge across Lubec channel between the province of New Brunswick and the state of Maine.
An act to amend the Judges Act.
An act respecting Westcoast Transmission Company Limited.
An act respecting the board of trade of the city of Toronto.
An act respecting the development and improvement of the national capital region.
An act to amend the Railway Act.
An act respecting the taxation of estates.
An act respecting Mid-Continent Pipelines Limited.
An act to amend the Customs Act.
An act to amend the Canadian Citizenship Act.
An act respecting broadcasting.
To these bills the royal assent was pronounced by the Clerk of the Senate in the following words:
In Her Majesty's name, the Honourable the Deputy Governor General doth assent to these bills.
Then the Speaker of the House of Commons addressed the Deputy Governor General as follows:
May it please Your Honour:
The Commons of Canada have approved certain expenditures for the public service, and the application of certain amounts in the accounts, of the year ended March 31, 1958.
The Commons also have voted supplies required to enable the government to defray certain expenses for the public service of the year ending March 31, 1959.
In the name of the Commons I present to Your Honour the following bills:
An act for approving certain expenditures authorized for the public service, and the application of certain amounts in the accounts, of the financial year ended the 31st March, 1958.
An act for granting to Her Majesty certain sums of money for the public service of the financial year ending the 31st March, 1959.
To which bills I humbly request Your Honour's assent.
To these bills the Clerk of the Senate, by command of the Deputy Governor General, did thereupon say:
In Her Majesty's name, the Honourable the Deputy Governor General thanks her loyal subjects, accepts their benevolence, and assents to these bills.

Prorogation of Parliament PROROGATION OF PARLIAMENT
After which the Deputy Governor General was pleased to close the first session of the twenty-fourth parliament of Canada with the following speech:
Honourable Members of the Senate:
Members of the House of Commons:
The twenty-fourth parliament has commenced with a most active and noteworthy session.
We have been glad to welcome this summer Her Royal Highness the Princess Margaret on her visit to Canada. We look forward with great pleasure to the presence in Canada next year of Her Gracious Majesty the Queen on the occasion of the opening of the St. Lawrence seaway.
During this present session you have welcomed and heard in parliament the President of the United States, the President of the Federal Republic of Germany, the Prime Minister of the United Kingdom and the Prime Minister of Ghana. These visits have provided a valuable and timely opportunity for discussions of problems of mutual interest and for an exchange of impressions on broader issues.
My government has been encouraged by indications of progress during the last few months in the field of disarmament and by recent developments in the Middle East situation but the general outlook remains uncertain and in particular, the current tension in the Far East is a source of deep concern.
My government took an active role at the emergency special session of the general assembly of the United Nations in promoting measures that would serve as a basis for a comprehensive effort to reduce tension and improve conditions in the Middle Eastern area.
My ministers have welcomed the announcement by the United States and United Kingdom governments of their readiness to suspend tests of nuclear weapons for one year while negotiations for a political agreement take place; they hope that as a result there will emerge an effective agreement among the nuclear powers continuing the suspension of testing under effective international supervision. The prospect of further technical talks to examine possible safeguards against surprise attack gives ground for hope of additional progress in this important field of disarmament.
My ministers welcome the approval you have given to the important agreement for the integration of the air defence of North America. Measures are being worked out to ensure that such defence is maintained on an efficient and economical basis consistent with the rapid technical changes in this field. Furthermore, arrangements have been initiated for closer consultation by ministers with members of the United States administration in the field of defence policy.
Your support of programs to provide practical assistance to the peoples of the less developed regions of the world through the medium of the United Nations, under the Colombo plan and under special arrangements for the West Indies and Ghana has been further evidence of the desire of Canadians to participate in international programs of economic as well as humanitarian importance.
You have had laid before you a report on the international conference on the law of the sea held in Geneva early this year and the five conventions agreed upon by that conference. My ministers will support the early convening of a second international conference on the law of the sea to deal with the important questions left unsettled at Geneva.
My government has been gratified to observe the improvement in the general economic conditions in Canada. It will continue its efforts to increase


employment and ameliorate the condition of those temporarily unable to find work.
During the present session you have enacted measures of major benefit to the people of Canada.
You have authorized an Increase in the public funds made available under the National Housing Act to ensure the further progress of our housing program.
You extended for a further six weeks during this year the period during which seasonal benefits were paid under the Unemployment Insurance Act.
You have provided for increases in the pensions of former members of the civil service, the armed forces and the Royal Canadian Mounted Police.
You have reviewed and improved the Veterans Insurance Act, the Returned Soldiers' Insurance Act and the Children of War Dead (Education Assistance) Act. and increased the benefits payable thereunder.
As a further interim measure to meet the needs of the grain producers in the prairie provinces, pending the working out of long term measures, you have provided an acreage payment to such producers. The Prairie Grain Advance Payments Act has been revised in the light of experience in its operation. The benefits of the Prairie Farm Assistance Act have been extended to an increased number of farmers. The lending power of the Canadian farm loan board has been enlarged. The Canada Agricultural Products Standards Act has been amended, and the amounts payable under the Animal Contagious Diseases Act have been increased.
You have approved the necessary arrangements with the government of Saskatchewan for carrying out the South Saskatchewan project and provided for the immediate commencement of construction of the main dam in this important undertaking.
You have made provision for the establishment of an office to assist small business in Canada.
You have provided a needed increase in the support furnished by parliament for the universities of Canada.
The Hospital Insurance and Diagnostic Services Act has been amended to set a definite and earlier date for the commencement of the payments authorized by it.
You have completely revised the legislation relating to taxes on estates, making it more equitable and practical as well as alleviating the burden on smaller estates. You have revised the Income Tax Act, and increased the exemptions from sales tax under the Excise Tax Act.
The National Capital Act which you have passed will make possible the more effective continuation of the long term development and improvement of the national capital and its immediate environs.
You have passed an important act to provide for the regulation of broadcasting in Canada and to ensure the continued operation of a national broadcasting system that will furnish a varied and comprehensive service of a high standard that is Canadian in content and character.
In the Parole Act you have created an orderly and permanent basis for the reform and rehabilitation of those confined to penitentiaries and their integration into society as useful citizens.
There has been placed before you a bill of rights for the recognition and protection of human rights and fundamental freedoms in Canada coming within the jurisdiction of parliament. There will now be an opportunity for this measure to receive careful study before action on it is finally taken by parliament.
Other measures enacted at this session include acts to approve the income tax conventions with Belgium and the Belgian Congo, the Canadian National Railways Financing and Guarantee Act,

the British Columbia Coast Steamship Service Act, an act to incorporate the lakehead harbour commissioners and an act to authorize the construction of a bridge between Campobello island and Maine. You have also amended the Railway Act, the Indian Act, the Criminal Code, the Penitentiary Act, the Lake of the Woods Control Board Act, the Loan Companies Act, the Trust Companies Act, the Maritime Coal Production Assistance Act, the Emergency Gold Mining Assistance Act, the Customs Tariff, the Customs Act, the Judges Act, the Financial Administration Act, the Yukon Act and the National Parks Act.
Members of the House of Commons:
My ministers welcome the approval you have given for the operation of a simultaneous translation system in the House of Commons.
Prorogation of Parliament Your committees have been more active than for many years past and show promise of contributing to the greater effectiveness of parliament in the future.
I thank you for the provision you have made for all the essential public services and payments in the current fiscal year and in addition for the approval granted for the payments made under special warrants last year.
Honourable Members of the Senate:
Members of the Commons:
I pray that divine Providence may continue to bless, protect and guide our nation.
This concluded the first session of the twenty-fourth parliament.

Question



ANSWER TO QUESTION

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

Mr. Boivin: In respect of how many contracts for rural mail delivery routes have tenders been invited in each of the provinces of Canada: (a) from June, 1955 to June, 1956; (b) from June, 1956 to June, 1957; (c) from June, 1957 to June, 1958?
Answer by: Hon. W. M. Hamilton (Postmaster General):
(a)	June, 1955 to June, 1956
(b)	June, 1956 to June, 1957
(c)	June, 1957 to June, 1958
British Columbia...
Alberta	
Saskatchewan	
Manitoba	
Ontario	
Quebec	
New Brunswick	
Nova Scotia	
Prince Edward Island Newfoundland	
41	25	2020	28	422	29	48	15	4118	99	78123	93	18657	42	5732	33	4312	3	6Nil	Nil	2
[The following items were passed in committee of supply]:



DEPARTMENT OF FINANCE

[Stage Direction]
503. Loan to the Ottawa civil service recreational association, on such terms and conditions as the governor in council may approve, to assist in the construction of the W. Clifford Clark memorial recreation centre, $300,000.
General administration-
550.	Departmental administration-further amount required, $20,775.
Administration of various acts and costs of special functions-
551.	Administration of the Farm Improvement Loans Act, the Veterans' Business and Professional Loans Act, the Fisheries Improvement Loans Act and the Prairie Grain Producers' Interim Financing Act-further amount required, $11,000.
Special-
552.	To provide for the expenses of the royal commission on Canada's economic prospects, including the payment, notwithstanding the Civil Service Act, of honoraria or allowances as may he authorized by the treasury board to officers, clerks or employees permanently employed in the civil service for services rendered by them to the commission, $191,300.
553.	To provide for the expenses of a royal commission on Newfoundland, including the payment, notwithstanding the Civil Service Act, of honoraria or allowances as may be authorized by the treasury board to officers clerks or employees permanently employed in the civil service for services rendered by them to the commission, $10,000.
554.	Grant to the national conference of Canadian universities to assist in defraying the expenses of the congress of universities of the British commonwealth to be held in Canada in 1958, $37,500.
General items of payroll costs including superannuation payments-
667.	To authorize, effective the 1st day of July, 1958, for the remainder of the fiscal year ending on the 31st day of March, 1959, increases in the allowances, pensions and annuities granted or payable pursuant to Part I of the Civil Service Superannuation and Retirement Act, the Civil Service Superannuation Act, an act to provide for the retirement of certain members of the public service (c. 67 of the statutes of 1920), The Civil Servants Widows Annuities Act, 1927, subsection (2) of section 15 of the Currency, Mint and Exchange Fund Act, the Royal Canadian Mounted Police Act (other than Part IV), the Defence Services Pension Act, the Public Service Superannuation Act, the pension plan of the national harbours board, and any appropriation act of the parliament of Canada that, in the opinion of the treasury board, provides for an allowance, pension or annuity based on length of service; the amounts of the increases shall be deemed not to be payments made pursuant to any of the foregoing acts or plan and shall be in such amount (or calculated at such rate), paid to such persons or classes of persons and paid in such manner and subject to such terms and conditions as the governor in council, by regulations, prescribes, $2,500,000.
Supply-Items Passed
668.	To authorize the treasury board to make regulations to provide for a hospital care insurance plan for
(a)	employees of Her Majesty In right of Canada (and their dependents), and
(b)	dependents of members of the Royal Canadian Mounted Police and of members of the regular forces,
if such employees or members have been appointed as such in Canada and are serving outside Canada; the regulations to provide for compulsory contributions to the plan and that persons included in the plan may continue to be so included for such period after returning to Canada as the regulations prescribe; government contribution to the plan for the present fiscal year, $15,000.
University grants-
669.	To provide that the rate of $1.00 mentioned in vote 541 of the Appropriation Act No. 1, 1957, is struck out and the rate of $1.50 is substituted therefor; and that a new agreement may be entered into accordingly with effect from the first day of April, 1958, between the national conference of Canadian universities and the Minister of Finance; the amount provided for in vote 127 of the main estimates for the present fiscal year to be applied to the purpose of this vote; additional amount required, $8,500,000.
52. Salaries and expenses of office, $848,790. Insurance-
156. Departmental administration, $632,198.

[Stage Direction]
Indian affairs branch-
Welfare and economic development of Indians-
666. Operation and maintenance-further amount required, $1,000,000.

[Stage Direction]
Terminable services-
663.	To provide for payments to western grain producers of $1.00 per acre up to a maximum of 200 acres per farm in accordance with regulations of the governor in council, $40,000,000.
664.	Contibutions to the governments of the provinces of Manitoba and Saskatchewan, in accordance with terms and conditions prescribed by the governor in council, of one-half of the amounts paid by the governments of those provinces for transporting haying equipment, fodder and livestock to and within those provinces on and after July 1, 1958, $500,000.

[Stage Direction]
670.	To provide for contributions to the provinces, pursuant to agreements entered into or to be entered into, with the approval of the governor in council, by Canada with the provinces, of amounts equal to one-half of the amounts confirmed by the provinces as having been spent by them for campground and picnic area developments-further amount required, $1,500,000.
Water resources branch-
671.	To provide for a fishway on the Yukon river at the site of the hydro-electric power development being constructed by the northern Canada power commission for the Whitehorse area, $1,000,000.


[Stage Direction]
Thursday, August 14, 1958