1959-05-13

Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, I wish to announce the appointment of a royal commission to inquire into problems relating to railway transportation and the alleviating of inequities in the freight rate structure. A little later I shall ask leave to table two copies of the order in council which establishes this commission.
Hon. members will recall that the Minister of Public Works (Mr. Green), as Acting Prime Minister, on November 26 announced the intention of the government to set up a suitable body to review the general field of railway problems and policy. He said this study would include not only a comprehensive consideration of the freight rate problem, including the situation of the long haul provinces in the west and in the Atlantic region, but also other specific problems which required solution if Canada's railways were to be able to serve the national interest without prejudicing particular areas or industries.
At the same time it was announced that pending the results of this long term study, measures would be worked out to relieve inequities in the freight rate structure, and this, of course, has been done in Bill C-38, now before the house, which is designed to carry out that intention. I think an examination of the terms of the commission will make clear that they are wide enough to cover all that is necessary and specific enough to direct the attention of the commission to the most urgent problems.
I should like to refer to the powers in general, which are as follows:	The commission is empowered to inquire into and report upon the problems relating to railway transportation in Canada and the causes thereof and to recommend solutions thereto; and in particular, without restricting the generality of the foregoing, the commission shall consider and report upon:
(a)	inequities in the freight rate structure, their incidence upon the various regions of Canada, and the legislative and other changes
that can and should be made in furtherance of national economic policy to remove or alleviate such inequities;
(b)	the obligations and limitations imposed upon the railways by law for reasons of public policy, and what can and should be done to ensure a more equitable distribution of any burden which may be found to result therefrom;
(c)	the possibilities of achieving more economical and efficient railway transportation;
(d)	whether and to what extent the Railway Act should specify what assets and earnings of railway companies in businesses and investments other than railways should be taken into account in establishing freight rates; and
(e)	such other related matters as the commissioners consider pertinent or relevant to the specific or general scope of the inquiry.
The commission will consist of the following: Hon. Charles P. McTague, Q.C., Ll.D., chairman; Herbert Anscombe of Victoria; Archibald H. Balch, Ottawa; Rene Gobeil, Quebec city; M. A. MacPherson, Sr., Q.C., of Regina; Howard Mann of Moncton and Arnold Platt of Lethbridge. We think those recommended have the necessary qualifications. Mr. McTague, Mr. MacPherson and Mr. Anscombe are, of course, widely known. Mr. Balch is chairman of the national legislative committee of the national railway brotherhoods. Mr. Gobeil is a consulting engineer. Mr. Howard Mann of Moncton is secretary of the maritime transportation commission, and Mr. Arnold Platt is a farmer and immediate past president of the Alberta farmers union.
The commissioners are aware that it is the desire of the government, and I am sure of parliament, that they should proceed with this inquiry with all reasonable dispatch in order that a report may be made on these important problems as soon as it is possible to assemble and consider all the information and analyses that it is necessary to have.
When the Minister of Public Works as acting prime minister announced the government's intention to arrange for this review he assured the western farmers that such review would not mean that they would have to pay more freight on the shipment of grain for export. I wish to take this occasion to confirm this, in regard particularly to the action that may be taken as a result of the work of the royal commission. To make it

Royal Commission on Railways clear beyond question, the Crowsnest pass rates are part of a bargain that was made between the railways and the government on the one hand and the settlers who went west on the other hand. We intend, in so far as this government is concerned, to see to it that that contract shall not be broken. I wish to table, sir, copies of P.C. 1959-577.


Hon. Lionel Chevrier (Laurier):: Mr. Speaker, we on this side of the house welcome the announcement by the Prime Minister of the appointment of a royal commission to inquire into transportation matters. While it is difficult at this time to analyse what the powers of the commission are, this will be possible after we have been able to consult Hansard.
However, as I listened to the Prime Minister I was impressed with the powers which the government intends to give to this commission, namely powers which will authorize the commission to investigate not only the inequities in the freight rate structure but also the transportation problem in general.
The house will remember that the Prime Minister invited some of us on this side to make suggestions to him as to the subjects to which consideration should be given by the commission. Whether or not these recommendations have been taken into consideration it is not possible for me to say from the statement the Prime Minister has made. 1 think there is no doubt, sir, that an investigation into the whole transportation problem of this country, that is the railway transportation problem, and into the freight rate structure is imperative at this time.
I would, however, like to remind the government that similar investigations were made by the former administration in years past. I should like to bring to the attention of the government the fact that under P.C. 1487 there was conducted a complete and thorough investigation of the freight rate structure. The board of transport commissioners has handed down three reports in that connection. Then there was the Turgeon royal commission which followed and which made a number of important recommendations all of which, in so far as the freight rate structure of this country is concerned, were implemented by the former administration by way of legislation.
There may be, however, a series of circumstances that have developed since that time which make it important and imperative that further investigation be carried out. The government has seen fit to do that, and we on this side of the house welcome it. May I, however, say to the Prime Minister,


in view of the statement made by the Minister of Transport and I believe by the Acting Prime Minister in the absence of the Prime Minister, that time is of the essence in connection with any investigation of this nature. I say that having regard to the fact that there is now pending, although it is adjourned, before the board of transport commissioners an application for a further increase of some 12 per cent in freight rates.
Whether or not it will be possible for this commission to report within the period of a year I am not in a position to say. But I do know this, that having regard to what the Turgeon commission did-and they made a very thorough investigation of the transportation problem-it took them two and one half years. It would seem to me that if this commission is to do the kind of job that parliament expects it to do, it should take all the time that is necessary.
I thought I should put these suggestions or this reaction to the announcement on Hansard because there can be no doubt that all of us agree that this is all to the good. In connection with the last statement made by the Prime Minister concerning the Crowsnest rates, I may add that I believe he will remember that on more than one occasion when I occupied the post of minister of transport I stated that there was no intention on the part of the then government to alter in any way the status of these rates which had been established in 1897.


Mr. H. W. Herridge (Kootenay West):: The
present injustices and inequities and the many problems that face the various regions in Canada, particularly certain sections of industry and agriculture, have required investigation for some time. On that account we in this group are glad to know that the government has appointed this royal commission to investigate this section of the transportation problem.
We are sorry, Mr. Speaker, that the royal commission has not the power to investigate all aspects of transportation including air, sea and road, because we believe that the evolution of a satisfactory transportation policy means an investigation into all aspects of transportation and the tying of them together by one investigation, one report and one set of recommendations.
To that extent, Mr. Speaker, in our opinion the royal commission has been shackled. However, we trust that the commission will speedily undertake its duties and that a report will come forward at the earliest possible time in order that legislation may be presented to this house at the soonest possible moment.

Starred Questions
AIR TRANSPORT	STARRED QUESTIONS



CANADA-U. K.    REPORT ON DISCUSSIONS ON AGREEMENT

Hon. George H. Hees (Minister of Transport):: Mr. Speaker, I wish to inform the house that discussions took place in Ottawa last week between the aeronautical authorities of the United Kingdom and Canada, with a view to bringing up to date the air agreement signed in August, 1949 between the two countries. The problems confronting the two governments on the next phase of international transport were examined, and it was decided that the traffic rights under the present bilateral should be broadened to meet the new situation.
The United Kingdom granted Canada the right to originate flights in Toronto destined for Hong Kong; to originate flights in western Canada destined for the United Kingdom; and rights in Europe between London, Brussels, Dusseldorf, Zurich and Vienna. Canada granted the United Kingdom rights in Toronto on the north Atlantic service. The air lines of both countries will be able to exercise the new rights on March 1, 1960.
I am very pleased with the outcome of the discussions with the United Kingdom, and expect that the new services will greatly contribute to the convenience of the travelling public.


Lionel Chevrier: Mr. Speaker, may I direct a question to the Minister of Transport. I was not able to follow too carefully the statement he just made. I should like to ask him whether the agreement includes fifth freedom rights for B.O.A.C. at Montreal?


George Harris Hees: No, Mr. Speaker.



EXCISE TAX ACT

Hon. Donald M. Fleming (Minister of Finance):: Mr. Speaker, pursuant to the resolutions which were adopted in the house on May 4, I ask leave now to introduce two of the budget bills, namely an act to amend the Excise Tax Act and an act to amend the Income Tax Act.
Mr. Fleming (Eglinton) thereupon moved for leave to introduce Bill No. C-47, to amend the Excise Tax Act.
Motion agreed to and bill read the first time.



INCOME TAX ACT

Donald Methuen Fleming: for leave to introduce Bill No. C-48, to amend the Income Tax Act.
Motion agreed to and bill read the first time.



PUBLIC WORKS DREDGES


Mr. Robichaud: 1.	Have any changes of personnel taken place on Department of Public Works dredges number 23 and 24 for the 1959 operating season?
2.	If so, (a) Are any of last year employees not being rehired for the coming season? (b) What were their names and how many years of service had each of these employees to his credit? (c) What were the reasons in each case for dismissal? (d) Were representations made against such employees, and what is the source of complaint in each case?


Hon. Howard C. Green (Minister of Public Works):: Mr. Speaker, the answers are as
follows:
1.	Yes.
2.	(a) Yes.
(b) Name	Service
Zoel Allain	
3^	seasonsGeorge Clancy	
3J	seasonsPius Robichaud	
3i	seasonsGeorge Savoie	
2	seasons
(c) and (d) There were no dismissals. These are seasonal positions and employment terminates at the end of a season.



EXPLORATORY OIL AND GAS PERMITS, NORTHERN CANADA  PUBLIC SALES

Mr. Hardie: 1.	How many exploratory oil and gas permits were issued between July 1, 1957 and March 31, 1959, on the mainland of northern Canada i.e. the Mackenzie district of the Northwest Territories and in the Yukon?
2.	How many public sales were held in that period, on what dates were they held, what are the names of the successful bidders in each sale, and how many acres are under permit to each successful bidder as a result of each sale?


Hon. Alvin Hamilton (Minister of Northern Affairs and National Resources):: The answer to the first part of the question is: Northwest Territories (Mackenzie district), 1,033 permits; Yukon Territory, 75 permits; total, 1,108 permits.
With regard to the second part of the question, Mr. Speaker, I have a list of these public sales with the acreages, and I would ask permission to have them printed in Hansard at this point as part of my answer.


Mr. Speaker:: Has the minister leave to have the answer to this part of the question printed in Hansard at this point?


Some hon. Members:: Agreed.
[Editor's note: The portion of the answer
referred to above follows]
September 23, 1957	Permits	AcresD. Todd Briggs	
2	94,335Shell Oil Company of Canada Ltd	
5	316,704Gorda Investments Ltd. . .	1	62,890
Starred. Questions
Permits Acres
November 17, 1958 Texaco Exploration Company 	
Shell Oil Co. of Canada	8	422,504Ltd	23	1,052,542Amerada Pet. Corp	
Great Plain Devel. Co. of	1	52,982Canada Ltd	
December 2, 1958 Murphy-Canada Oil Com-	8	418,448pany 	2	127,388Charles M. McAvoy 	
New Superior Oils of	3	184,464Canada Ltd	
December 15, 1958 Texaco Exploration Com-	1	60,948pany 	
Champlin Oil & Refining	3	159,620Co	
Canadian Husky Oil Lim-	1	52,982ited	3, 159,622Imperial Oil Limited ....	10	591,224Sun Oil Company 	1	53,656Mobil Oil of Canada Ltd. February 2, 1959 Shell Oil Company of Can-	11	574,685ada Ltd	
Pan American Petroleum	5	73,280Corp	
March 9, 1959 Pan American Petroleum	2	127,068Co	32	1,898,764Triad Oil Co. Ltd	
Hudson's Bay Oil & Gas	1	63,212Co. Ltd	
Shell Oil Company of	2	95,661Canada Ltd	
Canada Southern Petrole-	9	506,736um Ltd	1	63,854Dome Petroleum Ltd ....	1	31,445California Peace River Co. Alberta Bretorada Pet.	1	63,854Corp	3	150,102James Ross 	
Alberta Calgarada Pet.	1	50,262Corp	1	50,262



ATOMIC ENERGY


Mr. Martin (Essex East): 1.	Are negotiations underway at present between Canada and any other government or governments, with a view to a bilateral agreement on the peaceful uses of atomic energy?
2.	If so, with which countries?
3.	What form are any such negotiations taking?


John George Diefenbaker: The answer to the first question is yes.
The answer to the second question is: Japan, Pakistan, Australia and the European atomic

energy community, known as EURATOM. The members of EURATOM are Belgium, Federal Republic of Germany, France, Italy, Luxembourg and the Netherlands.
The answer to the third question is: In the case of Japan, a Japanese delegation has been meeting in Ottawa with Canadian government officials. The negotiations with EURATOM were conducted initially by a Canadian delegation sent to Brussels for this purpose and are being concluded by the Canadian embassy in that city with the EURATOM commission. The other negotiations have been taking place through normal diplomatic channels.




Mr. Martin (Essex East): 1.	Has a Japanese delegation been in Ottawa conducting negotiations for a bilateral agreement on the peaceful uses of atomic energy?
2.	If so, has an agreement been signed?


John George Diefenbaker: The answer to the first question is yes.
The answer to the second question is: No, an agreement has not yet been signed. However, good progress has been made in the work of the two delegations and a draft text has been referred to the Canadian and Japanese authorities for consideration.



ROYAL MILITARY COLLEGE


Mr. Hellyer: 1.	Is Royal Military College a degree-granting institution?
2.	If so, does its charter authorize the granting of honorary degrees?
3.	Who recommends candidates for honorary degrees?
4.	Have any candidates been recommended for such degrees?
5.	If so, who are they?
6.	What qualifications must any candidate for an honorary degree possess?
7.	Is Royal Military College under the jurisdiction of the Department of National Defence?


Hon. G. R. Pearkes (Minister of National Defence):: Mr. Speaker, in answer to the first two questions, the Royal Military College of Canada is a degree granting institution by virtue of The Royal Military College of Canada Degree Act. Section 2 of that act reads:
The senate of the college shall have the power to grant degrees and honorary degrees.
In answer to question 3, I suppose normally the recommendations would originate with the senate, but I know of no restrictions to prevent anybody making a recommendation to the senate.
In reply to questions 4 and 5, I am sure hon. members of the house will be very pleased to

learn that, on the recommendation of the senate, on Friday of this week Right Hon. John G. Diefenbaker will have an honorary degree conferred upon him. He is, as all hon. member know, Prime Minister of Canada, a member of Her Majesty's privy council, a distinguished member of the Canadian bar, and a gentleman who served overseas with the Canadian expeditionary force during the years 1916 and 1917.
In reply to the sixth question, I think the general answer is that the Royal Military College follows the normal practice of other universities in considering candidates for honorary degrees.
In reply to the seventh question, the answer is yes.



NATIONAL CAPITAL COMMISSION


Mr. McMillan: 1.	Has the national capital commission recently disposed of a parcel of land (approximately 40 acres) in the Tremblay road, St. Laurent boulevard, Queensway area, Ottawa?
2.	If so, to whom and at what price?
3.	Was this property publicly advertised for sale?
4.	Were bids invited from the public for this land?
5.	If such bids were not invited from the public, why not?


John George Diefenbaker: Mr. Speaker, the answer to the first question is no. The second is not applicable. The answer to the third and fourth questions is no, and the fifth is not applicable.
I think I should add, however, that I am informed that negotiations have been going on with regard to the disposal of property in the St. Laurent boulevard-Queensway area but as yet no recommendation has been received by the governor in council from the national capital commission.



AIR TRANSPORT FOR MEMBERS OF PARLIAMENT, WINDSOR-WHEATLEY, ONT.

Mr. Mcllrailh: 1.	Did the Department of Transport provide air transportation for a group of members of the House of Commons to Windsor and Wheatley, and return, on Thursday, May 7, 1959?
2.	If so, to what vote was the cost of such flight charged?


George Harris Hees: Mr. Speaker, the answer to part 1 is that the Department of Transport assigned an aircraft to transport from Ottawa to Windsor and return, on May 7, the members of the standing committee of the House of Commons on marine and fisheries on official business of the committee.
The answer to part 2 is vote No. 435-civil aviation branch-airports and other ground services-operation and maintenance, etc.
Orders for Returns

On the orders of the day:


Mr. Frank Howard (Skeena):: I would like to address a question to the Minister of Transport. I apologize for not having sent him notice, but it arises out of his answer to this starred question. Can the minister indicate what was the seating capacity of the aircraft which the Department of Transport made available for the marine and fisheries committee to travel to Windsor on May 7?


Mr. Speaker:: I would suggest that this question should be put on the order paper. It is purely a statistical inquiry and is of no great importance to the house.


Frank Howard: Mr. Speaker, if I may raise a point of order with regard to your suggestion that the question be placed on the order paper, it flows from a verbal answer in the house by the minister to a starred question, and because of information given by the minister I am seeking additional information.


Mr. Speaker:: If the hon. member wishes to ask a question which is supplementary to a starred question, he did not say so and I misunderstood him. If the hon. member has a supplementary question to an answer given to a starred question he may proceed.


George Harris Hees: Mr. Speaker, I will inquire and let the hon. member know the exact number of seats; but I can assure him that there were enough seats to allow both him and the Liberal members who did not go to do so, rather than trying in some manner to put the government on the spot.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. Denis: 1.	What have been the federal contributions to
each Drovince for conditional payments (a) agriculture:	(b) health; (c) hospital insurance; (d)
welfare; ie) vocational training; (f) highways and transportation; (g) resources development; (h) subsidized rentals and slum clearance; (i) other, during the fiscal years 1956-57, 1957-58, 1958-59, and estimated amounts for the fiscal year 1959-60?
2.	In what fiscal year was each of these conditional payments inaugurated?



SASKATCHEWAN


Mr. Carter: 1. For the fiscal year ended March 31, 1958, what were the total payments by the federal government to individuals, institutions, corporations, municipalities, and government, of the province of Saskatchewan?

Motion for Papers
2.	In the same year, what were the total payments made by the federal government elsewhere than in Saskatchewan on behalf of this province?
3.	What is the estimated amount of revenue received in the fiscal year mentioned, by the government of Canada, out of the province of Saskatchewan?
4.	For the fiscal year ended March 31, 1958, what were the payments paid to the residents of Saskatchewan by way of (a) family allowances; (b) the Old Age Security Act; (c) the Old Age Assistance Act; (d) Disabled Persons Act; (e) Blind Persons Act?
5.	At the end of that year how many people in Saskatchewan were reported as being in receipt of (a) unemployment insurance; (b) social welfare or relief?
6.	What was the estimated population of Saskatchewan on March 31, 1958?



MOTION FOR PAPERS


[Stage Direction]
Motion No. 96-Mr. Howard:
For a copy of all special price contracts entered into between Eldorado Mining and Refining Limited and (1) Bicroft Uranium Mines Limited; (2) Canadian Dyno Mines Limited; (3) Faraday Uranium Mines Limited; (4) Gunnar Mines Limited; (5) Lorado Uranium Mines Limited; (6) Rayrock Mines Limited; (7) Algom Uranium Mines Limited; (8) Can-met Explorations Limited; (9) Consolidated Denison Mines Limited; (10) Milliken Lake Uranium Mines Limited; (11) Northspan Uranium Mines Limited; (12) Pronto Uranium Mines Limited; (13) Stanleigh Uranium Mining Corporation Limited; (14) Stanrock Uranium Mines Limited.
Hon. J. M. Macdonnell (Acting Minister of Trade and Commerce):: Mr. Speaker, this motion, which calls for copies of all special price contracts between Eldorado Mining and Refining Limited and the 14 private uranium producers in Canada, is not acceptable to the government.
In these transactions Eldorado is acting merely as an intermediary between the Canadian producers and the atomic energy authorities of the United Kingdom and the United States. No Canadian government funds are involved. It would be improper and indeed a breach of business relationships to make available the details of these private transactions.
The house divided on the motion (Mr. Howard) which was negatived on the following division;
++YEAS
Messrs:
Fisher	Peters
Herridge	Regier
Howard	Winch-7.
Martin (Timmins)
Aiken
Aitken, Miss 
++NAYS
Messrs:
Allard
Allmark
Badanai
Baldwin
Barrington
Baskin
Batten
Bell (Carleton)
Bell (Saint John-Albert)
Benidickson
Best
Bigg
Boivin
Bourbonnais
Bourdages
Bourget
Bourque
Brassard (Chicoutimi) Brassard (Lapointe) Brooks
Browne (St. John's West) Browne (Vancouver-Kingsway)
Bruchesi
Brunsden
Campbell
(Lambton-Kent) Campbell (Stormont) Campeau Cardiff Caron Chambers Chevrier Chown Comtois Courtemanche Creaghan Crestohl Crouse Danforth Denis
Deschambault
Diefenbaker
Dorion
Drysdale
Dubois
Dumas
Dupuis
English
Eudes
Fairclough, Mrs.
Fairfield
Fleming (Eglinton) Fleming (Okanagan-Revelstoke)
Flynn
Fraser
Frechette
Garland
Gillet
Grafftey
Granger
Grills
Gundlock
Halpenny
Hamilton (Notre Dame de Grace)
Hamilton (Qu'Appelle)
Hamilton ( York West)
Hanbidge
Hardie
Harkness
Hees
Hellyer
Henderson
Hicks
Horner (Acadia)
Horner (Jasper-Edson)
Johnson
Jones
Kindt
Kucherepa
Lafreniere
Lahaye
LaRue
Latour
Lennard
Letourneau
Macdonald (Kings)
Macdonnell
Maclnnis
MacLean (Queens) MacLean (Winnipeg North Centre) MacLellan Macnaughton Macquarrie McCleave McGee McGregor Mcllraith McLennan McPhillips McQuillan McWilliam Maloney Mandziuk Martel
Martin (Essex East)
Martineau
Martini
Meunier
Milligan
Monteith (Verdun)
Morissette
Morris
Morton
Muir (Cape Breton North and Victoria) Muir (Lisgar)
Murphy
Nesbitt
Nielsen
Nixon
Noble
Nowlan
Nugent
O'Hurley
O'Leary
Pallett
Parizeau
Pascoe
Payne
Pearkes
Pearson
Pickersgill
Pratt
Racine
Rapp
Ratelle
Rea
Regnier
Ricard
Richard (Ottawa East) Richard (St. Maurice-Lafleche)
Roberge
Robichaud
Rompre
Simpson
Small
Smallwood
Smith (Calgary South) Smith (Lincoln)
Smith (Simcoe North)
Smith (Winnipeg North)
Southam
Spencer
Stanton
Starr

Stearns
Stinson
Tass6
Taylor
Thrasher
Tremblay
Tucker
Villeneuve
Walker
White
Wratten-166.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Hon. L. B. Pearson (Leader of the Opposition):: Mr. Speaker, would the Prime Minister say whether the Minister of National Defence was speaking for the government and has he any other comment to make on the statements attributed to the minister yesterday to the effect that "the west could knock the stuffing out of the Russians if they started a war today", "I am certain the western alliance has the nuclear power to totally obliterate their principal cities", while, and this is another quotation "a Soviet attack on North America today could very well prove abortive"?


George Randolph Pearkes: Mr. Speaker, I was asked to comment on a statement made by Mr. Khrushchev a few days ago, and I did make those remarks. I think all those remarks are true.


Lester Bowles Pearson: The Prime Minister did not answer the first part of the question. Was the minister speaking for the government in making this statement?


John George Diefenbaker: The minister has given his answer, and the responsibility of a minister to a government is always recognized.



REPORTED STATEMENT BY GENERAL PARTRIDGE TO U.S. SUBCOMMITTEE

[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: Would the Minister of National Defence comment on a statement made by General Partridge to the House of Representatives subcommittee on appropriations on February 12, at which he said he was speaking as a servant of the Canadian as well as the United States government, when he said:
We think the threat which we have now and the one which we shall have in the future is of the same general character as the offensive force which we ourselves are building.


George Randolph Pearkes: I have said many times that it is not the practice to comment on statements made by an officer of the United States before any congressional or other committee of that country. I feel that it would be most inappropriate to make comments on such statements as are alleged to have been made.
Inquiries of the Ministry


Lester Bowles Pearson: Mr. Speaker, this is not an alleged statement. It is from an official publication, and the man who made it-


Mr. Speaker:: Order. The Leader of the Opposition is not entitled to make statements himself. He is entitled to ask questions at this point, and at other times there are opportunities to argue.


Lester Bowles Pearson: May I ask a supplementary question. Does the minister not realize that General Partridge, in his own words, made this statement "as a servant of the Canadian as well as the United States government"?


George Randolph Pearkes: Mr. Speaker, as a servant of Canada an officer cannot be called before any United States congressional committee. He was called as an officer of the United States air force.


Hon. Paul Martin (Essex East):: May I ask
a supplementary question. For the purposes of the Royal Canadian Air Force, did the minister ask General Partridge whether or not he made that statement?


George Randolph Pearkes: You are asking me whether I will ask General Partridge if he made that statement?


Paul Joseph James Martin: Did you ask him?


George Randolph Pearkes: I am told by the Leader of the Opposition that he did make the statement and that it is in an official record.


Paul Joseph James Martin: In view of the fact that the Leader of the Opposition has brought this matter to the attention of the Minister of National Defence, will the latter call General Partridge before a committee here so we can inquire what the situation is in this particular?


George Randolph Pearkes: No, Mr. Speaker, since it is not the custom to call even Canadian officers before any such committee.


Hon. Paul Hellyer (Triniiy):: May I ask a
further supplementary question. Will the minister tell us what Canada's contribution would be to North American defence which would make any Russian attack abortive?


Mr. Speaker:: Order. I think this matter has gone too far. The hon. member is now asking a question which obviously is not one to be answered on the orders of the day.


George Randolph Pearkes: I would be very pleased to answer that question if I may. For example, there is the extensive warning system which Canada helps to maintain in the northern part of this country.


Paul Theodore Hellyer: Is the minister aware that in the evidence presented before a United States

Inquiries of the Ministry congressional committee there was a statement that the warning system could be jammed by attacking bombers?


John George Diefenbaker: By whom?


Mr. Speaker:: Order. The hon. member is pursuing a matter tor which he knows the answer. The minister answered the first question and gave his views about the propriety of the matter.


Paul Theodore Hellyer: I know the answer. I just wonder whether the minister does.



INDUSTRY


[Stage Direction]
On the orders of the day:
Mr. Speaker:: The hon. member for Essex East.


Mr. N. L. Spencer (Essex West):: I should like to direct a question to the Prime Minister. Following the presentation made to the cabinet by the united automobile workers last month on the matter of small cars, is the Prime Minister in a position at this time to make a statement on the subject?


John George Diefenbaker: Mr. Speaker, for some months there have been newspaper reports to the effect that the so-called big three in the United States motor car industry were planning to produce small cars in the United States. Following these reports a delegation of the united automobile workers had a conference with the government urging that, if such reports were correct, small cars should also be produced in Canada. Prior to the visit of the delegation the government had been giving consideration to this matter and discussions have been going on between the government and its officials with representatives of the automobile industry.
I can say this, that if and when Ford, General Motors or Chrysler announce that they intend to enter upon the production of the so-called small cars in the United States the government is determined, in so far as lies within its power, to have smaller cars produced in Canada.
To that end I have asked the presidents of General Motors of Canada, Ford and Chrysler to meet with me in Ottawa on Saturday morning when discussions will take place. Following these discussions I hope I will be in a position to determine, with my colleagues, the future course to be taken. But let me emphasize that if small cars are manufactured in the United States by these companies we want the same situation in Canada.


Paul Joseph James Martin: On a question of privilege, when the hon. member for Essex West rose to ask this question you referred to him as the member for Essex East, Mr. Speaker. Undoubtedly you recalled that I had put this question three times before.


John George Diefenbaker: Mr. Speaker, if I was in
error in my description of the hon. member, there was certainly no doubt about his identity in my mind.



PIPE LINES


[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: I wish to direct a question to the Acting Minister of Trade and Commerce. Has the government received a new application from Trans-Canada Pipe Lines Limited for the export of gas to the United States? If so, at what point or points in Canada does Trans-Canada Pipe Lines Limited propose to export gas to the United States?


James MacKerras Macdonnell: I will take that question as notice.



ST. LAWRENCE SEAWAY WELLAND CANAL  SUGGESTED SPECIAL SCHED- ULING FOR BULK CARRIERS

[Stage Direction]
On the orders of the day:
Mr. F. E. Lennard (Wentworth):: May I ask
the Minister of Transport if, in order to ensure adequate supplies of raw materials for some of our basic industries, any consideration is being given to special scheduling of bulk carriers through the Welland canal at this time of congestion there?


George Harris Hees: I wish to thank the hon. member for giving me notice of his intention to ask this question. It has been decided that, so long as a considerable degree of congestion occurs at the Welland canal, and in order to assist Canadian and United States industries dependent upon the expeditious movement of bulk materials, such as iron ore, coal, grain and pulpwood, and to ensure the effective operation of the canal, special dispatching will be resorted to under which bulk carriers -whether in ballast or loaded-fully engaged in the transportation of the commodities referred to will be taken alternatively with general cargo vessels. There will, of course, be adherence to the requirements of the International Boundary Waters Treaty Act of 1911 which provides for equal treatment of vessels of both Canada and the United States.

Inquiries of the Ministry FINANCE



REPORTED BAN ON CERTAIN FOREIGN VESSELS

[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: wish to address a question to the Minister of Transport. Did any representative of the Canadian government consult with representatives of the United States government or the St. Lawrence seaway authority before banning certain foreign vessels from the seaway?


George Harris Hees: Mr. Speaker, first of all I would like to make it very clear that no ships have been banned from the use of the seaway. Before the seaway opened shipping companies were advised that certain gear would be required in order to allow ships to move through our locks as efficiently and speedily as possible. What we have required these ships to do now is to instal this gear so that they can move through our locks as expeditiously and as efficiently as possible.


Herbert Wilfred Herridge: May I ask a supplementary question. Has the minister received representations from certain Canadian ship owners urging that priority be granted to lake ships over foreign ships in going through the seaway?


George Harris Hees: If the hon. member was in the house and paying attention he would have heard my answer given earlier today which dealt with the matter quite fully.


Herbert Wilfred Herridge: I was paying attention, but the noise created by party members opposite prevented my hearing it.



CANADIAN BROADCASTING CORPORATION


[Stage Direction]
On the orders of the day:
Lionel Chevrier: May I direct a question to the Minister of Labour. Is the minister aware of a possible walk-out of C.B.C. employees following the rejection by the union negotiating committee of the federal conciliation board's report? What is the minister or his officials doing to conciliate this dispute?


Hon. Michael Starr (Minister of Labour):: Yes, I am aware of the circumstances involved in this dispute, and our department is doing everything it possibly can to provide
facilties for a settlement.
66968-9-229



REPORTED INTENTION TO CURTAIL PERSONAL AND COMMERCIAL LENDING

[Stage Direction]
On the orders of the day:
Mr. Alexander Best (Halton):: I should
like to direct a question to the Minister of Finance. Has the government or the Bank of Canada recently issued any instructions to the chartered banks to limit credit or new loans?
Hon. Donald M. Fleming (Minister of
Finance):	None whatever, Mr. Speaker
There have been rumours, and there have been speculative articles in the press, suggesting that a letter had gone out from the Bank of Canada to the chartered banks proposing some form of credit restriction. I have made inquiries of the Bank of Canada and I am informed that they have sent out no such letter, and so far as any indication on the part of the chartered banks to their clients on the subject of their credit is concerned, it has not been sent at the suggestion of the Bank of Canada or with the prior knowledge of the Bank of Canada. The same applies, so far as the government is concerned. Whatever has been done by the chartered banks in this respect has been done entirely on their own initiative.


Mr. W. M. Benidickson (Kenora-Rainy River):: May I ask a supplementary question. I am thinking of the last sentence in the minister's reply. He referred particularly to a letter. Will he assure the house that the governor or his senior officials have not, in consultation with the commercial banks at a conference urged them to do the thing to which reference has been made?


Donald Methuen Fleming: I am told that
there were some conferences or meetings of the chartered banks in this respect, but the meetings were held without any prior knowledge whatever on the part of the Bank of Canada.


Mr. Erharl Regier (Burnaby-Coquiflam):: May I ask the minister if he is now aware of the decision of the banks to seriously curtail lending activities and if so, is the government contemplating any action to ensure that enough money will be available for the immediate expansion of the Canadian economy?


Donald Methuen Fleming: Mr. Speaker, so
far as action on the part of the chartered banks is concerned, I presume the banks will have to be guided by what they consider to be good banking practice in this respect. I can tell the hon. gentleman, if he is suggesting that the government should debauch
3616	HOUSE OF
Inquiries of the Ministry the currency of this country, we have no intention of doing any such thing.


Mr. M. W. Martin (Timmins):: Will the
minister inform the house as to what effect this may have on the co-operation the banks may give to the minister's efforts to market federal securities in the future?


Mr. Speaker:: I think the hon. member
is getting rather ahead of the possibilities. Unless he relates the question to a specific loan I think it is too hypothetical and indefinite.
LLater:l


Erhart Regier: I have a question I should like to ask the minister in view of his claim only a few minutes ago that neither he nor the Bank of Canada had any prior knowledge of this meeting of the chartered banks as a result of which action is now being taken. Was the government or the Bank of Canada a participant in any of these discussions prior to the decision arrived at by the banks?


Donald Methuen Fleming: No, Mr. Speaker.



INQUIRY AS TO ACTION PROTECT BONDHOLDERS FROM LOSS

[Stage Direction]
On the orders of the day:
Murdo William Martin: I wish to direct a supplementary question to the Minister of Finance in view of his reference to the debauchery of currency. Is the minister aware that the price offered yesterday on his 41 per cent conversion bond was down to $91.25 and is the government planning any action to protect the small investor who may have to sell his bonds from suffering exceptional losses?


Donald Methuen Fleming: Mr. Speaker, it is an extraordinary question that concerns itself with the price of securities in the market fluctuating day by day. The government never said that it would support these bonds in the market. On the contrary, when the question was asked in this house last September by the Leader of the Opposition (Mr. Pearson) I made it quite clear that there was no such undertaking on the part of the government or the Bank of Canada. As the hon. member may be aware or should be aware by now, the situation in the market is the result of the fact that the banks for some time now have been selling in substantial amounts their holdings of Canada bonds in order to place themselves in a liquid position to provide the credit sought of them to an extraordinary degree at the present time in the course of the great recovery that is going on in the Canadian economy today.


William Moore Benidickson: I have a supplementary question. The minister referred to the normal market freedom of buyers and sellers in this


particular realm. Does he want to say to the house that, without consultation with him, the Bank of Canada supported until late October the market price of these bonds?


Donald Methuen Fleming: Mr. Speaker, I dealt with that subject in this house two weeks ago in a speech of such length that I blush even to think of it. I am not a little surprised and I may say highly flattered that my hon. friend should ask me now to repeat something that I said then and tried to say very plainly. I spoke at that time of what the Bank of Canada had done both in the after-market and at the time around the first of November when they ceased to buy bonds of those particular issues.


Mr. Pickersgill:: Why don't you answer the question?



AGRICULTURE


[Stage Direction]
On the orders of the day:
Paul Joseph James Martin: May I ask
my friend the Minister of Agriculture, who is in a generous mood today, if he is in a position to announce the government's policy with regard to representations that have been made for the continuation of floor prices on sugar beets and soybeans, products that mean so much to the farmers of southwestern Ontario?


Hon. D. S. Harkness (Minister of Agriculture):: Mr. Speaker, as the hon. member knows, I am always in a generous mood, but I am not in a position to make any announcement in regard to these two commodities today.



DEFENCE PRODUCTION


[Stage Direction]
On the orders of the day:
Mr. Hubert Badanai (Fort William):: I have a question for the Minister of Defence Production. Could the minister comment on the statement made in Fort William on May 11 and reported in the Times-Journal of May 12 to the effect that an announcement would be forthcoming within two months on the possibility of aircraft interceptor contracts for the Canada Car plant at Fort William?


Hon. Raymond O'Hurley (Minister of Defence Production):: Mr. Speaker, I am certainly not in a position to control all the representations that appear in newspapers, and this is news to me.


Mr, D. M. Fisher (Pori Arthur):: May I ask
a supplementary question. Has the Minister of Defence Production any information on the possibility of a Bobcat contract for Canada Car at Fort William or the possibility of aircraft component contracts, and have his officials given any information to Premier Frost on this subject which he has not given to the house?


Mr. O'Hurley:: Phase 2 of the Bobcat program is progressing in Montreal in Canada Car, and we have briefed Canada Car on the possibility of getting contracts for aircraft components, but at the moment I have no definite report to make on this subject.


Mr. Fisher:: I think the minister missed my question. Has he given any information on this particular point to Premier Frost of Ontario that he has not given to anyone else?


Mr. Speaker:: I am not sure how the hon. member would justify a question of that kind.


Douglas Mason Fisher: Premier Frost made an announcement in Fort William two days ago that the Bobcat contract had been speeded up, and that aircraft interceptor contracts were going to come within two months to this plant. If he is making these announcements, I should like to know what his contact is from the point of view of the Minister of Defence Production?


Raymond Joseph Michael O'Hurley: Premier Frost is absolutely right so far as speeding up the Bobcat program is concerned. I think I gave the answer to the other part of the question. We have given every facility and encouragement to Canada Car at Fort William to get some contracts from the air defence program in the United States.



POST OFFICE DEPARTMENT


[Stage Direction]
On the orders of the day:
Mr. Azellus Denis (SI. Denis):: May I ask
a question of the Postmaster General. Will the minister give the house the reason for another recent stamp issue, and will the minister explain the meaning of the design which seems to represent a rather fully dressed woman sitting on her heels picking a banana from its stem?


Hon. W. M. Hamilton (Postmaster General):: I might say that this stamp design commemorates the significant contribution of Canadian women to the formation and development of the international organization of 66968-9-229J
Inquiries of the Ministry rural women's groups known as the associated country women of the world, and is the first Canadian stamp ever designed by a woman. We are rather proud of that fact. I am sorry that the hon. member seems to have completely missed its significance and has tried to cast aspersions on the work of this artist. The stamp, of course, represents a symbolic woman attending a plant on which is superimposed a globe of the world, indicating the international aspects of this movement which originated in Canada. I may say that it has proved to be abundantly clear to almost everyone who has seen the design.


Some hon. Members:: Oh, oh.


John Whitney Pickersgill: I have a supplementary question, Mr. Speaker. May I ask the Postmaster General what is a symbolic woman?


Mr. Speaker:: Order. Two hon. members have supplementary questions. The hon. member for Bonavista-Twillingate has already finished his question. I recognize the hon. member for Kootenay West.


Herbert Wilfred Herridge: My
supplementary question is addressed to the Postmaster General. Is it not correct to say that the federated women's institutes of Canada expressed their great appreciation of this stamp?


William McLean Hamilton: I am
extremely grateful to the hon. member whose observation is quite correct. Several members of the national executive of the women's institute saw the design a substantial time before it came and were quite delighted with it.


John Whitney Pickersgill: Perhaps I could ask a supplementary question. I wonder whether the minister could tell the house what a symbolic woman is.


Some hon. Members:: Oh, oh.


Mr. Speaker:: Order. I do not think I
should allow the minister to run that risk.



HARBOURS


[Stage Direction]
On the orders of the day:
Mr. J. R. Taylor (Vancouver-Burrard):: should like to direct a question to the Minister of Transport. Can the minister say whether negotiations have been completed between the national harbours board and the civil aviation officers with respect to the use of Vancouver harbour for seaplanes?
3618	HOUSE OF
Inquiries of the Ministry


George Harris Hees: Mr. Speaker, I wish to thank the hon. member for giving me notice of his intention to ask this question. The civil aviation officers of the department have recently concluded negotiations with the national harbours board, and it has been decided both to increase the size of the area designated for use by seaplanes, and to relocate the area in order to reduce taxiing to and from bases of operation to a minimum.
Incidentally, it was deemed necessary to continue to restrict seaplane traffic in the harbour to commercial air carriers and aircraft belonging to industrial concerns having business in the harbour, owing to the normal heavy traffic of ships.



TRANSPORT


[Stage Direction]
On the orders of the day:
George Harris Hees: While I am on my feet, Mr. Speaker, I should like to answer a question which was asked me yesterday by the hon. member for MacKenzie River (Mr. Hardie). I was asked if I was aware that the Northern Transportation Company intends to use ships of United States registry in Arctic work this year.
The Northern Transportation Company reports to the Minister of Trade and Commerce (Mr. Churchill), but I can inform the hon. member that I am not aware of any United States commercial vessels which are being used in supply work in the Arctic this year. Certain United States naval vessels, which were the only suitable type available, were transferred to my department when the United States government agreed that Canada should take over the supply of the D.E.W. line, and these are in the custody of Northern Transportation Company which, of course, operates them with Canadian personnel.


Mr. M. A. Hardie (Mackenzie River):: wonder whether the Minister of Transport can tell me whether those ships have passed Canadian steamship inspection for Arctic work?


George Harris Hees: Yes, Mr. Speaker.



DISPOSITION OF ORDER RESPECTING DEMURRAGE ON GRAIN CARS

[Stage Direction]
On the orders of the day:
William Moore Benidickson: I would like to direct a question to the Minister of Transport. I was wondering if he could inform the house whether or not, by order in council, the decision of the board


of transport commissioners with respect to demurrage for railway cars with respect to grain has been altered and, if so, what is the duration of the time specified in the order in council?


George Harris Hees: Mr. Speaker, this order has been held up in order to allow the matter to receive further consideration and study.


William Moore Benidickson: Mr. Speaker, I do not think the Minister of Transport answered me directly. Has there been an order in council suspending this particular ruling of the board of transport commissioners?


George Harris Hees: Yes, Mr. Speaker.



INQUIRY FOR RETURN


[Stage Direction]
On the orders of the day:
Mr. Yvon Dupuis (St. Jean-Iberville-Napier-ville):: Mr. Speaker, in the absence of the Minister of Public Works I should like to ask a question of the Secretary of State. (Translation):


Yvon Dupuis: Has the minister made inquiries, as he promised to do on April 22 last, concerning question No. 108 which I had asked in early February and which had been passed as an order for return? The question dealt with certain retaining walls.


Hon. Henri Courtemanche (Secretary of State):: Mr. Speaker, as several departments are concerned, some of the inquiries remain to be done, but I shall reply to that question very soon now.


Yvon Dupuis: Could the minister tell me what other departments can be concerned with the matter of retaining walls?


Henri Courtemanche: The Department of Transport and the Department of Public Works.


Yvon Dupuis: That is not several others, just one other department.


Mr. Tremblay:: It takes two to handle that job.
(Text):



ROYAL CANADIAN AIR FORCE


[Stage Direction]
On the orders of the day:
Paul Theodore Hellyer: I should like to direct a question to the Minister of National Defence. Will the minister tell the house whether any consideration was given by the R.C.A.F. or by his department to providing transportation for Air Commodore Fauquier

of the famous Dambusters squadron to attend the ceremony before the Queen Mother in London?


George Randolph Pearkes: Yes, Mr. Speaker; but unfortunately no transportation was available nor is it possible for the R.C.A.F. to meet the many requests made by individuals who wish to attend similar events in the United Kingdom.


Paul Theodore Hellyer: I have a supplementary question. Could the minister tell us whether space was available in the Lancaster bomber which flew other members of the R.C.A.F. to London?


Mr. Speaker:: I am not sure that this line of inquiry is of sufficient urgency to take the time of the house that is by asking whether there was space in an aircraft flying across the Atlantic. The hon. member can ascertain by private inquiry what the answer is or put the question on the order paper.


Lester Bowles Pearson: I rise on a point of order, Mr. Speaker. This matter has already received a great deal of attention in the press. It deals with a man who was a great hero in the R.C.A.F. during the war, and the ceremony in London is of great symbolic importance. Surely it is proper to ask whether or not it would have been possible to make an exception in this case so that he could have attended the ceremony in London.


Mr. Speaker:: I understood the minister to have given an answer. I did not intervene on the first question, but it seems to me that the second one went too far.



REQUEST FOR STATEMENT RESPECTING


[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: Mr. Speaker, I would like to ask the Acting Minister of Trade and Commerce whether he can give the house any information as to the progress, if any, being made in the discussions concerning the renegotiation of the Soviet-Canadian trade agreement, and whether reports to the effect that difficulties are being encountered in this matter are correct?


James MacKerras Macdonnell: I will take that question as notice, Mr. Speaker.



UNEMPLOYMENT INSURANCE ACT


[Stage Direction]
The house resumed from Tuesday, May 12, consideration of the motion of Mr. Starr for
Unemployment Insurance Act the second reading of Bill No. C-43, to amend the Unemployment Insurance Act.
William Moore Benidickson: Mr. Speaker, I rather thought from the challenges that had been made in the debate so far that perhaps the first speaker this afternoon would have been the Minister of Finance (Mr. Fleming) explaining to us the reasons for the extraordinary financing that the cabinet has seen fit to provide for the unemployment insurance fund, which everybody knows is a fund which has about $400 million worth of securities in its portfolio. I am not going to comment further about that. I hope that before the debate concludes the minister will explain, not only the authority but the reason for this unusual and unprecedented form of governmental intervention in the affairs of a fund that is basically contributed to by non-government sources. Eighty per cent comes from employees and employers.
My chief point at this time, Mr. Speaker, is to direct the attention of the house to the fact that in the last couple of years, as the Minister of Labour (Mr. Starr) himself said, we have had an unusual experience in that the amount of money paid out has greatly exceeded the amount of receipts. Of course, that is typical of any insurance scheme, at unusual times but the question which I want to raise before the house at this time is the question of whether or not the act, as it now stands, is really satisfactory to members of this house having regard to investment policy. I will be the first to say that this particular legislation was provided by the previous administration; but under the previous administration we had not the same experience of take-outs from the fund as we have had recently. I confess, that section 85 of the statute stipulates that the funds of the unemployment insurance commission should be invested exclusively in government of Canada securities.
Then under section 20 there is set up what is called an investment committee. Having regard to the experience of the last couple of years and the startling information that there have been capital losses of over $10 million-perhaps more, but the latest return was $10 million-I wonder if the house in considering this act would not want to make sure that a review should take place with respect to the set-up of the investment committee as determined by section 20 of the act. I do not think that anybody who examined parliamentary return 8 2A, I think it is, of last session in 1958 would have failed to note that a high proportion of the investments of the fund were in victory bonds on March 31, 1958. But the interesting factor is that the people who are in charge of
3620	HOUSE OF
Unemployment Insurance Act this very large capital fund happen to be the same people who have other responsibilities in connection with government debt policy and general fiscal policy. In recent times I am suggesting to the house that there could be on their part difficulty in deciding where their judgment should lie. According to parliamentary return 82A, which I mentioned, $402 million was invested in victory bonds. I cannot think that any committee member at that time could fail to foresee that there was a likelihood of greater need for liquidity in the assets of the fund; but on the other hand the same people who under this section are asked to be the investment committee are the very people who were associated with the Minister of Finance and others in the promotion of the sale of longer term government financing through the conversion loan.
In other words I see that these people are at times in the regrettable position of being asked to wear two hats. I believe that it would be highly advisable for the Minister of Labour and the government to reconsider this matter of the investment committee. In my opinion the investment committee in charge of a fund of these enormous proportions should be completely detached from the possibility of any conflict of interests with respect to the relationship of the policy of the Minister of Finance or the government in the matter of fund raising.
We have a precedent in the Canada Council. We have an investment committee there headed now by a private citizen, the much-esteemed former governor of the Bank of Canada. This bill is asking us to make sure that further amounts go into the unemployment insurance investment portfolio. While we are doing that I suggest we should make sure that the most impartial determination of best advantage to the contributors will result without question.
This is an unusual fund to the extent that it is not substantially government money. Eighty per cent of it is contributed by employees and employers. Under the act one member of the investment committee is nominated by the Minister of Labour but two are designated as being either the nominee of the Minister of Finance, or the governor of the Bank of Canada, or the nominee of the governor. Those who are paying 80 per cent of the shot, having regard to the disclosure of these capital losses, would I think feel better assured if we had an independent investment committee. I raise that matter for the consideration of the house.
We have been rather restricted in debate in discussing some sections of this bill. I am hoping that the committee on industrial


relations will not feel itself so restrained. I am hopeful that the committee will call for evidence about the possibility of widening the group of those who are insured under this scheme. This is a major factor but at this time the government has not seen fit to increase the number of those who could in all likelihood suffering this particular catastrophe expect insurance coverage. I feel the time is ripe for the industrial relations committee to examine the act carefully.
I am thinking of the possible inclusion of hospital workers and many other employees. Hospital workers alone number approximately 100,000. In view of the proportion of hospital revenues that will come from either provincial or federal government sources through insurance schemes I believe that hospital employees should be brought into this scheme. There are hospital maids and non-professional workers of various kinds who have not been included and I feel that the committee should give this question very serious consideration.
My main point, however, is simply to say that the experience of the last year or two indicates that the individuals who are responsible for policy with respect to the investment of funds in the unemployment insurance fund are the same people who in another capacity are engaged in debt management and other fiscal government matters. In view of the fact that 80 per cent of the contributions to the fund come from outside government sources-they are in essence taxes-I think a more independent investment committee is highly justified.
I would therefore at this stage move, seconded by the hon. member for Nipissing (Mr. Garland), the following amendment:
That all the words alter "that" be struck out and the following substituted therefor:
"this house declines to give second reading to this bill which makes no provision for ensuring the stability of the unemployment insurance fund through the establishment of an investment committee independent of the persons responsible for carrying out the government's policies with respect to the public debt".


Donald Methuen Fleming: Mr. Speaker, I rise on a point of order. I submit to you that this amendment is out of order. You will observe that it proposes that the house should not give second reading to the bill on the ground that the bill-and this is the language of the amendment:
-makes no provision for ensuring the stability of the unemployment insurance fund through the establishment of an investment committee independent of the persons responsible for carrying out the government's policies with respect to the public debt.

In shortened form, Mr. Speaker, this amendment proposes that the house should not give second reading to the bill because we have not included in the scope of the bill a provision which is not there now. When the Speaker was in the chair last evening he was called upon to deal with another amendment introduced on behalf of the official opposition which he ruled out of order. That amendment, if I may recall it to you, sir, was in these words:
This house declines to proceed with this bill because its provisions were formulated and introduced without any consultation by the government with the advisory committee and before receiving the annual report of that advisory committee on the financial condition of the unemployment insurance fund for the fiscal year ending March 31, 1959, and its recommendations thereon.
May I say, Mr. Speaker, in view of the fact that you were not in the chair at the time, that the ground upon which the Speaker ruled that amendment to be out of order was that on second reading an amendment that can be submitted and be in order is an amendment that sets up a contrary principle, a principle contrary to the principle of the bill. It was quite evident to the Speaker, in dealing with the amendment introduced last evening, that it did not introduce a principle contrary to the principle of the bill. It dealt with something that the opposition argued was antecedent to the introduction of the bill, something that should have been done before the bill was brought before the house, that there should have been prior consultation, that the bill should not have been submitted until a certain report had been received. In view of the nature of the amendment he ruled that it did not set up a principle contrary to the principle of the bill, and therefore he ruled it out of order.
Now, that rule, Mr. Speaker, is obviously one aspect of the rule of relevance. My submission to you with respect to this new amendment, is that it fails for the same reason and is not relevant to the bill before you. The bill before you contains a number of amendments to the Unemployment Insurance Act, in designated clauses of that act. None of these clauses relates to the subject matter of this amendment.
In his remarks in leading up to the introduction of his amendment, the hon. member for Kenora-Rainy River (Mr. Benidickson) referred to the provisions of section 20 of the main act which determines the composition of the investment committee. Then he made reference also to the later sections of the act, sections 85 and 86. None of these sections, Mr. Speaker, falls within the scope of the amending bill now under debate, Bill No. C-43.
Unemployment Insurance Act
Last night the Speaker had occasion to refer not once but several times to the well-established rule that the introduction of a bill to amend a statute in this house does not in fact open up the entire statute for discussion in this house, and discussion on the amending bill must be relevant to the bill and cannot stray outside the scope of the bill into the wider provisions of the statute which it proposes to amend. This is precisely what has been done here this afternoon.
There is nothing in the present bill at all that concerns or affects the composition or the powers of the investments committee. There is nothing in the amending bill, which relates to investments, and yet the amendment before you proposes that the house should withhold second reading of this bill because it makes no provision for changing the provision of the main act in reference to the investment committee.
If this amendment were in order it would be possible for any member to discuss any provision of the main act, regardless of whether it receives mention or no mention in the amending bill. It would be equally competent to any member to introduce any amendment proposing that second reading of the bill be withheld because some provision of the main act, not mentioned in the amending bill, is not included within the scope of some particular amending provision. This would reduce the procedure of the house obviously to chaos, and it is because of considerations of this kind that the rule is so well established: first, that the introduction of an amending bill does not open up the main statute for discussion and debate; second, that any amendment must be strictly relevant to the bill. The fact that it concerns some provision of the main act does not make it at all relevant to the bill. In the third place, Mr. Speaker, the fact is that this amendment does not set up a principle contrary to the principle of the bill. It says only that the bill should not be read now because it does not make provision for something that lies outside of it. Obviously, Mr. Speaker, this amendment is out of order on several grounds and I respectfully ask you so to rule it.
Mr. W. M. Benidickson (Kenora-Rainy
River): On the point of order, may I just refer to the matter of relevancy? Your Honour will have looked at the remarks of the Speaker the other night when he referred to principles of an amending bill. I think that is of the essence here. We are being asked to vote additional moneys to this fund. This amendment relates entirely to those moneys and I say that that therefore is one of the basic principles of the bill. I

Unemployment Insurance Act refer to the principle of stability of the fund or the integrity of the fund, as I think the Minister of Labour (Mr. Starr) called it the other night. It is of the essence to make sure that the investment policy will maintain stability and integrity in the fund.


Paul Joseph James Martin: If you
would allow me, Mr. Speaker, I should like to supplement what the hon. gentleman who has just taken his seat has said in this connection. This matter has interested me and I thought I would engage myself this morning in looking up the appropriate authorities which I think clearly establish the false position in which the Minister of Finance seeks to place us when he calls Your Honour's attention to an amendment which had been ruled out of order last night. But, as he himself indicated in the remarks which he made this afternoon, there is no similarity between the amendment now before Your Honour and the amendment submitted last night.
I call Your Honour's attention to May's sixteenth edition at pages 530 and 531. At the bottom of page 530 I find the following:
It is also competent for a member who desires to place on record any special reasons for not agreeing to the second reading of a bill, to move what is known as a "reasoned amendment". This amendment is to leave out all the words in the main question after the word "that" and to add other words: and the question proposed upon the amendment is, that the words proposed to be left out stand part of the question. A reasoned amendment is placed on the paper in the form of a motion and may fall into one of several categories.
(1)	It may be declaratory of some principle adverse to, or differeing from, the principles, policy or provisions of the bill.
(2)	It may express opinion as to any circumstances connected with the introduction or prosecution of the bill,-
And I underline the words "circumstances connected with the introduction".
That is a statement of principle which has been recognized by all commentators, including Beauchesne, who makes reference to a comment similar to May, in citation 382, which of course is well known to this house and which deserves mention at this time. Citation 382 reads:
It is also competent to a member who desires to place on record any special reasons for not agreeing to the second reading of a bill, to move as an amendment to the question, a resolution declaratory of some principle adverse to, or differing from,-
And I underline the words "or differing from". I continue:
-the principles, policy, or provisions of the bill.
And so forth. I shall not quote the remaining portion of this particular citation. Then if we look at the work, "A Parliamentary Dictionary", we find on page 162 what is meant by a reasoned amendment. In the

first paragraph on page 162 beginning with the second sentence I find the following:
This form of amendment-
Your Honour will remember that my hon. friend sought to base part of his argument upon his interpretation of what was a reasoned amendment.
-seeks, by substituting other words for those of the question "that the bill be now read a second (third) time", either to give reasons why the house declines to give a second or third reading to the bill, or to express an opinion with regard to its subject matter or to the policy which the bill is intended to fulfil.
My hon. friend who has just spoken has emphasized the argument of relevancy, and in that connection I would refer Your Honour to Votes and Proceedings for 1958 where there is a ruling by His Honour the Speaker on a problem involving this particular principle. The reference will be found on page 539 at the middle of the page where Mr. Speaker makes this observation with regard to the argument of relevancy:
This is the third time I have had to deal with this matter today.
I would call Your Honour's attention specifically to this observation. He says:
I will not repeat what was said previously. The first question which must be considered is relevancy. I think the Minister of Justice, in acknowledging that it would be relevant to debate whether the clauses of this bill are in conflict with our obligations under GATT, thereby acknowledges that an amendment directed to that same purpose is relevant, because if it is relevant to debate it-
That is the important point-"because if it is relevant to debate it."
-if the amendment is otherwise good-it is relevant to move an amendment declaratory of a principle to the same effect.
All through this debate, as the hon. member for Kenora-Rainy River has emphasized, emphasis has been placed in argument on the importance of preserving the integrity of the unemployment insurance fund. That has been the gist of most of the speeches. The particular committee referred to in section 20 of the Unemployment Insurance Act, modification of which is proposed in this amendment, has to do with that very argument, and if it is proper to make reference to such an argument and make it part of the main argument in debate, as Mr. Speaker has said, it is possible and justifiable to base an amendment on such an argument even though, as the Minister of Finance said, directly there was no specific reference in the bill. However, I would argue that by implication and indirection there certainly is.
The Minister of Labour himself has given us the justification for this amendment. He said that the purpose of the bill was to

maintain the integrity of the fund. The integrity of the fund can best be maintained by a proper investment policy. A proper investment policy is one pursued by the investment committee under section 20 of the act, and this amendment calls for a rearrangement and a new composition of that investment committee in order to do what the Minister of Labour said, namely maintain the integrity of the fund.
In this connection, if Your Honour will address himself again to May, page 421, 16th edition, he will find the author's comments on the question of relevancy, the matter I am now pursuing. There the author says:
The fundamental rule that debate must be relevant to a question necessarily involves the rule that every amendment must be relevant to the question on which the amendment is proposed. Stated generally, no matter ought to be raised in debate on a question which would be irrelevant, if moved as an amendment, and an amendment cannot be used for importing arguments which would be irrelevant to the main question.
Surely that is clear. The Minister of Labour indicated that the purpose of this bill was to maintain the integrity of the fund, and if we were justified in commenting on that particular purpose and now seek to strengthen the instruments by which the fund is to be made stronger, then surely this amendment must perforce be regarded as in order. Lest there be any doubt whatsoever, I refer Your Honour again to the words of Mr. Speaker at page 539 of last year's Votes and Proceedings where he goes on to point out:
The first question which must be considered is relevancy. I think the Minister of Justice, in acknowledging that it would be relevant to debate whether the clauses of this bill are in conflict with our obligations under GATT-
The amendment there had nothing to do, in the sense in which the Minister of Finance speaks with the argument in debate but since argument in debate was permitted by Mr. Speaker it must follow that the reasoning which he pursued in connection with that particular matter applies on all fours with regard to the matter now before us. The facts before us are that the unemployment insurance fund was diminished to the extent of $10 million as a result of the loss of value of certain securities held by the commission. That was a permitted situation as a result of the operations of the investment committee. We say that happened because the investment committee was improperly constituted and that because of these facts and in order to preserve the integrity of the fund the committee ought to have a different composition such as this amendment contemplates.
There is no precedent whatsoever against an amendment like this. All the positive 66968-9-230
Unemployment Insurance Act evidence clearly indicates that we satisfy the argument of relevancy. When my hon. friend says that there is nothing in the particular amendments before the house having to do with the investment committee he is right, but the point is, as the Minister of Labour said, that the purpose of the bill is to maintain the integrity of the fund and the only way that can properly be done is by an investment committee that is so constituted as to further that particular end.
For these and among other reasons I ask Your Honour to take the view on the basis of this argument that there can be no doubt whatsoever that this is a proper amendment, a proper amendment likewise for the reasons which caused Mr. Speaker the night before last to accept in principle the argument made in the amendment which I had the honour to propose. That amendment had nothing to do whatsoever with the sections of the bill. We were calling in that amendment for an increase in the contributions paid by the federal government for the purpose of giving benefits to the unemployed people of our country. There is nothing in the amendments which have to do with the federal contribution and to argue that this particular amendment is out of order is to argue that the Speaker was wrong on Monday when he acknowledged the amendment put forward at that time. So, Mr. Speaker, with confidence in this argument I submit it to you.


Mr. Deputy Speaker:: First of all, I must remind the house that we cannot compare the ruling which was made the other night by Mr. Speaker concerning the amendment proposed by the hon. member for Essex East (Mr. Martin) with the position of the present amendment. There is a marked distinction between this amendment and the other amendment, and the ruling which was made the other night does not serve as a precedent for the ruling which I now propose to make.
I have listened with great interest to the comments made by the Minister of Finance (Mr. Fleming). I have also listened carefully to the remarks made by the hon. member for Kenora-Rainy River (Mr. Benidickson), and the hon. member for Essex East. There are two points which I should like to emphasize. The first one is the question of relevancy. In the present instance, I consider that this amendment is not relevant to the bill being discussed. It is rather relevant to the act itself, but at the moment we are not discussing the act, we are discussing the bill. The second point I wish to emphasize is that the

Unemployment Insurance Act house should listen carefully to the way in which the amendment reads. I shall now read it:
This house declines to give second reading to this bill which makes no provision for ensuring the stability of the unemployment insurance fund through the establishment of an investment committee independent of the persons responsible for carying out the government's policies with respect to the public debt.
The way in which this amendment reads actually makes it more in the form of a separate resolution or bill than an amendment to what is contained in the bill under discussion. Then again, the rule of relevancy is completely disregarded. If every bill that was discussed by this house were subject to amendments of this type which could stipulate that the bill did not contain enough and should contain something else, then there would be no relevancy at all. I consider this amendment which is now before the house contains no reference to anything contained in the bill and I must therefore rule it out of order.


Mr. Harold E. Winch (Vancouver East):: must admit that I find myself in some difficulty at this stage of second reading of Bill No. C-43 to amend the Unemployment Insurance Act. I rather think I am in the position known as being over the proverbial barrel because I am damned if I do and I am damned of I do not, when it comes to a question of how to vote. Undoubtedly many cogent arguments have been set forth, not once but repeatedly, that there are sections of this bill which are of such a nature that they should be opposed.
There is a provision in the bill for approximately a 30 per cent increase in the charges on employers and employees so as to re-establish the fund or, as has been so aptly put by previous speakers, to maintain the integrity of the fund. I think it is obvious also that in so far as the beneficiaries of the fund are concerned, there is not a commensurate return from the 30 per cent increase in the charges which is to be levied in the future. There is also a section of the bill which introduces new and discriminatory taxation and to that, of course, I am certainly opposed.
In addition, I agree with the objections that have been raised that the increased charge is, in part, made necessary as a charge on the insured because of circumstances over which he had no control. I refer, of course, to the amount of money that was required to be taken out of what was actually an insurance fund to take care of the situation that arose because of serious unemployment, call it a recession or depression if you


like, and changes introduced by the government without any financial responsibility being accepted by the government which made the changes in the act. I think that is a negation of the principle of insurance and should not be supported.
There is also another matter, of course, which I think is very serious, and that is the fact there is no increase contemplated in the weekly allowances to those beneficiaries who fall in the low income categories. The amounts which they are receiving now are certainly low enough, and if the employees in the future have to pay increased charges and yet the majority of those workers will receive no increase whatever, then I think there is something wrong with the basic principles. As I say, Mr. Speaker, there are excellent and cogent reasons which have been put forward in great detail by a great many speakers in this house as to why there should be opposition to second reading.
At the same time there is another side of the picture. I find I am in agreement with the fact that some improvements are being made in the bill which is now before us. We have the bringing of new salary groups into the plan, and I think that is all to the good. There are small, very small provisions for an increase in the earning rates at the same time one is drawing unemployment insurance. Small as this improvement is, it is to the good. Then, of course, there is the extension of coverage. If one is eligible the period of eligibility is raised from 36 weeks to 52 weeks. Although I am rather inclined to believe that this will not cover a great many in the plan, it is an improvement without a doubt. For these latter reasons, therefore, I feel that the bill should be supported on second reading. You see, Mr. Speaker, what I meant on opening when I said I was over the proverbial barrel and damned if I did and damned if I did not.
However, an hon. member should, if he can act with conscience, vote, and so far as I am concerned a decision has to be reached. I have reached a decision, Mr. Speaker, based on this fact. If one turns down a bill on second reading which contains improvements which one favors, then turning down second reading in order to kill those things you do not like automatically deprives the people of this country of the opportunity of reaping the benefits of the improvements. The important fact is, and it is an important fact, if a bill does pass second reading, then every member of this house gets an opportunity to support those sections which he feels are improvements in the act, and at the same time he is able to speak against and vote against those measures of which he disapproves. There is such an occasion where

one can express an opinion on each proposal and each section, and that is when the bill gets into committee. Although I strongly disapprove some of the provisions and I think I also disapprove some of the motives behind the government's introduction of some of the provisions of this bill, nevertheless I also agree with some of the proposals and we will have an opportunity of expressing ourselves by speech and by vote in committee, and be able to try to vote down the things we do not like and try to get through the things we like. After being careful to explain that that is my position, as far as I am personally concerned it is my intention to vote in favour of the second reading of this bill.


Mr. J. R. Garland (Nipissing):: Mr. Speaker, I should like to speak briefly on this matter. The bill before us, which is one to amend the Unemployment Insurance Act, seems to substantiate in my mind, two points. The first is that the government is prepared to accept the proposition of mass unemployment in Canada and the second is that it seems prepared to accept as a fact that unemployment will continue. In other words, it is apparent that this government, which claimed to have all the answers when they sat on this side of the house, are bankrupt of ideas for the solution of Canadian problems today. They are pursuing policies which, if continued, could bankrupt our national treasury. Mr. Speaker, it is apparent that the Minister of Labour and his colleagues have no policy to deal with unemployment. Instead, they seem to accept it by this legislation they seek to extract from Canadian workers and Canadian employers enough cash to pay for the government's folly. In other words, they are seeking to have workers and employers pick up the cheque for the failure of this government. The necessity for replenishing the unemployment insurance fund simply reflects the failure of this government to restore confidence in our economy, and failure to recognize and to attempt to cure the basic causes for the heavy drain on the unemployment insurance fund.
It is not my intention to deal at any length with these causes. They are well known, I think, to most Canadians: lack of planning; diversion of trade rather than expansion of trade; higher interest rates which are a drag on expansion and a drag on our economy; higher taxes, which retard and restrict expansion, expansion which can only come from increased savings and those savings from earnings. I think the people are wondering what has happened to this billion dollar program of public works. All of these things are, of course, the reasons, to a great degree, for 66968-9-230i
Unemployment Insurance Act the necessity for the legislation that is before the house at the present time.
But I rose today primarily to bring one matter to the attention of the government. I refer to the difficulty that is being experienced by many of our young people in Canada today in getting established in the labour force. I am talking particularly about those people under the age of twenty. They have been having considerable difficulty especially in this past couple of years. This is one of the most disturbing factors in our whole economy. It is one which is giving concern to many of the welfare organizations throughout our country and I think should now concern the government and business generally. I am not suggesting that this matter is solely the responsibility of the government but it is a very real problem.
I am going to use November figures which show a great difference between the impact of the recession on working people over 20 and its impact on those to whom I refer, namely those under 20. At November 15, 4.5 per cent of the labour force between the ages of 25 and 44 were out of a job and looking for work; but of the labour force between 14 and 19, 12.5 per cent were jobless. Unemployment among this group, I recognize, is always higher because they have difficulty in getting established in the working force. The rise of unemployment among teen-agers from 5 per cent in November, 1956, to 9.8 per cent in November, 1957, and now to 12.5 per cent in November of last year, is indeed an alarming situation. If, as seems likely, a large number of young people will be leaving school-


Mr. Speaker:: I am listening to the hon. member's exposition of the problem with respect to the employment of people first coming to an age where they will begin working. I would ask him to relate what he is saying to the problem that is before the house. I have not yet seen that there is in this bill or in the amendment anything which involves the matter which the hon. member is discussing.


Lionel Chevrier: Mr. Speaker, I should like to rise on a point of order and, at the same time, on a question of privilege.


Mr. Speaker:: Perhaps the hon. member for Laurier (Mr. Chevrier) would allow the hon. member for Nipissing (Mr. Garland) to indicate how he intends to relate what he is saying to the bill. I have simply asked him to do so. If he does not want to answer, I will hear the hon. member for Laurier.


Lionel Chevrier: Before he does so, Mr. Speaker, I should like to rise on a question of privilege affecting all of the members of

Unemployment Insurance Act this house. It has to do with the amendment which was made a moment ago by the hon. member for Kenora-Rainy River (Mr. Beni-dickson) and about which the hon. member for Essex East (Mr. Martin) spoke at some length. While he did so, the Speaker in the chair had a ruling which he gave and I am sure it must have been a prepared ruling. He did this in the absence of Your Honour who was in the habit of ruling and who did rule on two of the amendments that were proposed by this side of the house, I believe the day previous. It seems to me that the fact that the amendment was made just a few minutes before the ruling was handed down, although the Speaker at that time had in his hands the text, is a matter of privilege affecting all of the members of this house, having regard to the fact that this should have taken place when Your Honour was out of the chair.


Mr. Speaker:: The hon. member knows very well that it is not open to any member of the house to impugn the conduct of the Chair, whoever may be in the chair. It cannot be raised as a matter of privilege. The only way in which such a matter can be put forward is by making a positive motion calling the conduct of the Chair into question. I therefore cannot allow the hon. member for Laurier (Mr. Chevrier) to proceed to criticize the occupant of the chair for his conduct, even though he is not satisfied with it.


Lionel Chevrier: Mr. Speaker, the last
thing that I would want to do is to impute motives to either the Speaker or the person who holds the Speaker's place in his absence. But the point I was trying to make is this-


Mr. Speaker:: The hon. member was doing exactly what he has said he would not want to do and I hope he will not continue to do it again. What is before the house now is a question which I have asked the hon. member for Nipissing who has the floor. I have asked him whether he can relate the problem he has been discussing with the bill that is before the house.


Lionel Chevrier: Will Your Honour allow me to rise on the point that I indicated to Your Honour-


Some hon. Members:: No.


Lionel Chevrier: -because I think there has been an invasion of the rights of the members of the opposition.


Mr. Speaker:: I understand what the hon. member says but I cannot see how he could possibly, within the rules of this house, continue the discussion which he opened as a matter of privilege. I therefore cannot hear

him in that way at this time. If the hon. member wishes to bring that matter before the house, he has open to him a way of doing it but it is not by a direct attack on the conduct of the Chair.


Paul Joseph James Martin: May I ask Your Honour how an hon. member can raise this question? This question is not one of censure but a question relating to the clarification of a decision of the greatest importance with regard to freedom of debate in this house.


Some hon. Members:: Order.


Mr. Speaker:: I think the hon. member for Essex East is making the same error.


Paul Joseph James Martin: With respect to Your Honour, it is not an error.


Mr. Speaker:: A decision was made by the Chair in my absence a few minutes ago by the Deputy Speaker.


Donald Methuen Fleming: And not appealed.


Mr. Speaker:: The hon. member should not draw inferences and make imputations against the Chair, no matter what he feels about its conduct, unless he does it in the proper way which is by a substantive motion in which the allegations can be made and the facts debated. There is no other way under the rules.


Paul Joseph James Martin: Mr. Speaker, I have asked Your Honour a question. Are you now suggesting that we can have this particular ruling clarified by way of a positive motion? There is no suggestion on the part of the hon. member for Laurier (Mr. Chevrier) or anyone else of imputing motives either to Your Honour or to the Deputy Speaker. That has not been our custom in this parliament. But we do feel that there has been a grave error committed today, and we are asking Your Honour how that can be rectified? We feel it is an error. Certainly it is inconsistent with the ruling-


Mr. Speaker:: There is only one course open to an hon. member who disagrees with the ruling of the Chair, and that is to appeal.


Donald Methuen Fleming: Shame.


Lionel Chevrier: You are a fine one to say shame.


Mr. Speaker:: Order. I am not supposed to give interpretations of the rules of the house. Hon. members know that there is that right of appeal, and that is the only way in which a decision of the Chair can be reviewed.


Michael Starr: Shame on you.


Lionel Chevrier: It is the Minister of Finance who should be slapped. No one is more shameful than he is.


Paul Joseph James Martin: Mr. Speaker, in the British house during the last century Lord Morley, I think it was, on an occasion like this made an observation of this order regarding a ruling that was not regarded as valid. Your Honour said we should have appealed. We have endeavoured throughout this parliament not to resort to that course for the reasons I have stated. An appeal would not solve this question. Hon. gentlemen opposite would vote against us as they always do.


Mr. Speaker:: Order. I have made my ruling. I am sorry, but I cannot hear the hon. member further. The hon. member for Nipissing (Mr. Garland) had the floor, and he was dealing with the question of unemployment of young people coming to the age of employment. Before he proceeds to discuss that problem I assume he is relating it to the bill, and I would ask him how he attempts to do so?


John Richard Garland: Thank you very much for bringing me back to the point where I was when Your Honour stopped the debate. It seems to me that in discussing the legislation which we are considering today, which is necessary to replenish the unemployment insurance fund, we may discuss some of the reasons which have brought about this particular necessity. The point I was trying to make was that a substantial drain on this fund is due to one segment. It does-


Mr. Speaker:: Let me put it to the hon. member in this way so that he understands me. I have no intention of restricting the debate on this bill beyond what appears to me to be its proper scope, and I have given a good deal of latitude, in my own view, to what is the proper scope. If the hon. member who has posed a particular problem relating to young people wishes to suggest that this bill deals with that problem inadequately or has some suggestion how this bill can deal with it, then he is in order and can proceed. If he is discussing unemployment at large, that would not be in order.


John Richard Garland: Mr. Speaker, I assure you I have no intention of discussing unemployment at large. However, statistics prove, as do the government's own figures, that a substantial drain on the fund is due to that segment to which I referred earlier, namely those people in the labour force under the age of 20. It seems to me that this legislation fails to recognize that fact. Here is the percentages of the labour force between 14 and 19 years of age that are unemployed: in November 1956, 5 per cent; in November 1957, 9.8 per cent; in November of last year the figure had risen to 12.5 per cent. I was simply going to say
Unemployment Insurance Act that the number of people coming out of school this year who probably will not go back in the fall, together with the larger group coming up next year, makes this a very real problem which I think the government should recognize and in some way endeavour, with the co-operation of business generally, to solve.


Lester Bowles Pearson: Mr. Speaker, I desire to say something about this bill on its second reading, which normally deals with the principle of the bill and which normally gives the opposition the opportunity to discuss, in a very general way, those principles and other matters relevant to the bill and all that it covers.
I agree, Mr. Speaker, with the government that something has to be done about the unemployment insurance fund, and I propose in the course of my remarks, with your permission, to deal with the situation which brought about this necessity and to deal also with the various methods by which this difficulty could be overcome, one of which has been put forward by the government in this bill. But that is not the only way of dealing with the problem, and indeed in our amendments, two of which were ruled out of order, we put forward alternative proposals dealing, as we thought, with the principles of the bills and its problems.
Mr. Speaker, as to the reasons which require legislation of this sort-I will come back to that again later in my speech-the statistical report on the operation of the Unemployment Insurance Act for March 1959, which has just come to my hand, gives us some very good evidence as to why the fund has to be strengthened, why it has to be replenished, and why the steps which the Minister of Labour (Mr. Starr) referred to in his brief address the other night have to be taken to strengthen the stability and the security of this fund which is so important to the workers of this country. This fiscal report includes, perhaps as its most significant fact, that unemployment for the 12 months ending March 31, 1959, according to benefits paid to claimants on the fund, was nearly 25 per cent greater than in the 12 months ending March 31, 1958. The total benefits paid out amounted to $479 million as against $385 million, the monthly average of beneficiaries being $452,000 for 1958-59 as opposed to $366,000 for 1957-58.
Mr. Speaker, I agree with the hon. member for Vancouver East (Mr. Winch) that in approaching this bill and in approaching this problem we in the opposition, as the hon. member pointed out, are in a dilemma. There are some things in this bill which should and do meet with our approval. There are other

Unemployment Insurance Act things in the bill with which we strongly disagree; and there are some omissions from the bill which we think should be put in the bill.
There are also circumstances surrounding the introduction of this bill with which we most strongly disagree. Of course, that constitutes a dilemma. On second reading, as an hon. member said, you are confronted with a dilemma whichever way you vote. You are damned if you do and you are damned if you don't.
There are various ways of dealing with the problem which this bill attempts to deal with in one particular manner. There was an interesting editorial in the Financial Post of May 9 entitled, "Split Insurance Fund?" which puts forward one method of alleviating this problem. Perhaps I could place on the record one or two paragraphs from that editorial. Dealing with the draft bill before us the editorial said:
The proposal now is to raise contribution rates 30 per cent and to make a start at adding another huge group of seasonal workers to the fund-those in agriculture. This will simply mean that the industrial worker and employer will be making welfare payments to farm workers as well as to loggers and fishermen.
This is manifestly unfair.
I do not say that I agree with those words in the editorial. I continue:
An entirely new approach to unemployment insurance in Canada is needed. Perhaps we should not have one unemployment insurance scheme, but two. One could cover year-round workers and could pay its own way. The other could cover seasonally employed loggers, fishermen and farm workers and its resources could be beefed-up by drawing on the general funds of the state.
The government has not attempted to follow that course in the amendments to the act nor did the opposition in the amendments we put forward follow that course exactly. But we did put forward the view that the government contribution to this fund in the present circumstances-the proportion of the fund met by the general taxpayers through contributions-should be higher than it is at present. That was the principle that was embodied in the amendment we put forward yesterday. However, I agree, as I have said, that something has to be done. We do not think this bill is going at it in the right way although there are some parts of which we approve.
As I said, we strongly condemn the circumstances surrounding the introduction of this bill and this debate in the House of Commons. We believe that the procedures followed and those not followed by the government exhibit a contempt of parliamentary rights. That is all the more surprising in view of the language that used to be used by some hon. gentlemen opposite when anything

happened in this house that appeared to reflect on parliamentary rights and privileges. We think also-and this is one reason which would certainly justify any hon. member of this house voting against second reading of this bill-that there has been evasion or violation of certain of the provisions of the unemployment insurance act with which this bill deals. We think there has been on the part of the government a refusal which is to be condemned to provide the information on which to form an intelligent and reasoned judgment on the merits and principles of this bill on second reading. We are surprised, to put it mildly, that in this debate on second reading there has been no contribution made to this vitally important matter by hon. members on the government side of the house at a time when the level of unemployment is greater than it has ever been since the act was introduced.
The present debate has not been easy for the opposition. Hon. members opposite have certainly raised points of order which we believe has unduly restricted the debate. They have restricted debate by their interruptions and by the raising of these points of order. Yet no member of the government as yet has commented on any proposal made by those on this side of the house. We are always being charged by hon. members on the government benches with having no proposals to make. They say we are merely objecting. Yet we have not heard from any member of the government in regard to the proposals which were emphatically made by the hon. member for Essex East (Mr. Martin) and which have been repeated by others.
The government has not yet answered the questions we have asked or given the information we had the right to get. Indeed, it would have been quite impossible for us to have conducted this debate with any sense of realism or of having covered the whole subject if we had not been able to secure after the debate began a report from the unemployment insurance advisory committee which has a definite bearing on the matters covered by this bill. I have said that I thought in this matter the government has evaded or violated certain provisions of the Unemployment Insurance Act. Having made that statement which has already been made in this debate by my friend the hon. member for Essex East I should attempt to document it.
In our opinion paragraph 2 of section 3 of the act has been violated because the minister failed to carry out that genuine and effective consultation with organizations representing labour in connection with the appointment of a member of the unemployment insurance commission


Mr. Speaker:: Order. The hon. member is now getting into an area which I very clearly decided in the course of this debate was beyond the scope of this debate; that is, the constitution of the advisory commiteee, the appointment of the membership and matters relating to the advisory committee which are not called into question in any way in the bill which is before the house. I must ask the Leader of the Opposition (Mr. Pearson) not to deal with the question of the appointment of the advisory committee. I shall leave it at that.


Lester Bowles Pearson: Mr. Speaker, I had not mentioned the advisory committee. I mentioned the unemployment insurance commission. Certainly, however, I feel that I had every right to mention the unemployment insurance advisory committee because that is the committee which is the agency charged in this bill-


Mr. Speaker:: The hon. member perhaps misunderstood me. I did not say he had no right to mention the unemployment insurance advisory committee. I said I would not permit a debate on the question which was attempted yesterday; that is, the appointments to the advisory committee. I may have misapprehended that the Leader of the Opposition was going in that direction.


Lester Bowles Pearson: Mr. Speaker, I am sorry if 1 misunderstood you. What I was hoping to be able to point out was that the unemployment insurance advisory committee is the agency referred to in the amendments and charged in this bill with the responsibility for giving financial advice to the commission and the government in the operation of the fund and surely it is possible to mention the committee and its activities in connection with this bill because whether the bill is a success or not will largely depend, not only on its provisions, but on how they are carried out. It is our contention that at the present time the government has violated the act to the point where this committee now has no legal existence of any kind.
I am not arguing for the moment how that was brought about. Perhaps that would be out of order. But the result of the action taken or not taken is that this committee, which is so important in its connection with this bill, has now only a chairman and five members when the act itself in paragraph 1 of section 19 says that there shall be a committee consisting of a chairman and not less than six members. It has not got six members. How, therefore, can this committee function? How, therefore, can the purposes of this amendment be carried out in so far as
Unemployment Insurance Act they affect this committee, when no such committee is in legal existence?


Mr. Speaker:: That may be a proper subject of debate at another time. The hon. member can bring that forward as a charge against the government for its failure to comply with the provisions of the Unemployment Insurance Act. That in effect is what he is doing. But the committee is involved in this debate in so far as we have heard the recommendations which the government has tabled and which have been submitted to the government in connection with the amendments to the act. I have not sought to interfere with the fullest and freest debate on the contents of that report but I do repeat, in my view, the members who seek to deal with the actions of the government with respect to the constitution of the committee are contravening the rules of the house. I hope the Leader of the Opposition will appreciate that I am not trying to curtail the debate on the bill which is before the house, but I am trying to enforce the rules of the house by ensuring that debate proceeds in an orderly manner toward a decision on the matters which are before the house. The questions the hon. member raises are not before the house and will not be before it, and they are out of order.


Lester Bowles Pearson: Mr. Speaker, what we have before the house is a bill which seeks to replenish the unemployment insurance fund and to provide stability for that fund, to ensure that that fund will be administered in the best interests of those who benefit from it as unemployed. We are giving some more money to the fund; we are giving more responsibility to the agency which administers the fund. I am merely saying, Mr. Speaker, that one of those agencies, which was referred to by the minister in his opening statement, though he spoke only a few minutes, cannot discharge its responsibilities under this amendment or under the act.


Mr. Speaker:: Order. I understand what the hon. member is saying but he persists after I have made my ruling in going on with the discussion. I hope he will not make it necessary for me to ask him to desist.


Lester Bowles Pearson: Mr. Speaker, I will drop that although I had something more to say about it. You have ruled it out of order and naturally I accept your ruling.
There is another section of the Unemployment Insurance Act which in our view, Mr. Speaker, has been evaded and it has a bearing on this bill and I think on this debate, and that is paragraph 2, section 90. We contend, Mr. Speaker, that under that section-
3630	HOUSE OF
Unemployment Insurance Act


John George Diefenbaker: What section is that?


Lester Bowles Pearson: Paragraph 2 of section 90. Under this section the report made in August, 1958 to the advisory committee on the status of the fund, a report which has a bearing on this bill, should have been tabled weeks ago, according to the specific and clear requirements of this section of the act. I know perfectly well, Mr. Speaker, that under the act there is an obligation on the part of the government to table all reports made to the governor in council by the unemployment insurance advisory committee. I also know that there is no obligation or requirement under the act for this committee to make reports to the minister as such but only to the governor in council as such.
The minister said the other day-and this surely has a bearing on our discussion-that he had invited the committee to make this report to him. We have pointed out-and perhaps I am repeating-that the report itself, which we have now been permitted to see, certainly does not support the contention that any request was made on the committee for its production. But surely, Mr. Speaker, it is an evasion not, I admit, a violation- and I did not use the word "violation"; I said it was an "evasion"-of this section of the act that a report can be made of that importance, dealing with the operation of the act and the fund, not to the governor in council but to the minister, thereby perhaps preventing its appearance in parliament so that it may be of help to us in debating this matter.


John George Diefenbaker: Will the hon. gentleman allow a question? Was he a member of the government at the time the former minister of labour asked the same thing and received a report which was never brought before parliament or tabled? That was in 1955.


Paul Joseph James Martin: Order.


Lester Bowles Pearson: I have no knowledge of that at all, and if it were true-and I do not know whether it is true or not-it has nothing whatever to do with what I am saying. Whenever we make this kind of statement, Mr. Speaker, and whenever the government gets into this kind of position it takes advantage of its research assistants-and of course it has more of them than the opposition has-and goes back 10, 15 or 20 years and digs up something that happened in earlier times and then puts that forward as justifying its position in 1959. Even if that had happened in 1955, is the Prime Minister (Mr. Diefenbaker) suggesting that that justifies everything being done now in connection with this matter?


John George Diefenbaker: May I ask the hon. member a question?


Lester Bowles Pearson: If I may continue-


John George Diefenbaker: I understand you. I am asking-


Some hon. Members:: Order.


John George Diefenbaker: I am asking-*


Paul Joseph James Martin: Sit down.


John George Diefenbaker: What was that?


Paul Joseph James Martin: I said "sit down".


Some hon. Members:: Order.


Mr. Speaker:: I do not know whether the hon. member has yielded the floor; I think not.


Lester Bowles Pearson: If the Prime Minister has a question.


John George Diefenbaker: If the hon. gentleman does not want to have a question asked I am only too willing not to ask it.


Lester Bowles Pearson: Go ahead.


John George Diefenbaker: Is he willing? All right. I suggest to him that during the period he was a minister of the crown-


Some hon. Members:: That is not a question.


John George Diefenbaker: I suggest to him that on several occasions a minister asked the advisory board to produce those reports and to make summaries in respect of amendments to the act and those were not tabled because they were not required to be under the statute.


Lester Bowles Pearson: That is a new kind of question.


Mr. Mcllraiih:: Typical tactics of the present Prime Minister.


John Whitney Pickersgill: Arguments we are not permitted to make.


Lester Bowles Pearson: That is quite all right. The Prime Minister has made a suggestion which will appear on the record.


John George Diefenbaker: Is it a fact and did it take place?


Lester Bowles Pearson: The Prime Minister has now made it a question by saying "is it a fact"?
I shall be glad to look into that. Merely because the Prime Minister states it as a fact does not necessarily make it a fact.
There is another section of this act, paragraph (1) (b) of section 86, which also has a bearing, a direct and definite bearing, on the bill before us. I suggest it has been violated by the Minister of Finance (Mr. Fleming). This paragraph reads:
Where the amounts standing to the credit of the unemployment insurance fund in the consolidated

revenue fund are not sufficient for the payment of benefits under this act, the Minister of Finance, .	. may,
(b) on the security of such obligations, credit further amounts to the unemployment insurance fund-
Mr. Speaker, we have put into the record a couple of orders in council dated April 2 and April 23, and I make no reference now to the circumstances of the production of those orders; but the orders in council in question, approved on April 2 and April 23, makes no reference whatsoever to the conditions stipulated in the act that the amounts standing to the credit of the fund are not sufficient for the payment of benefits.
In the second place, those orders in council authorize the Minister of Finance to make loans from time to time to the fund, but section 86 of the act makes no provision for loans. The section which I have just read authorizes the minister to credit further amounts; it does not authorize the minister to make loans from time to time, as the order says, but only when a very specific situation arises, as I pointed out a moment ago.


Donald Methuen Fleming: Oh, oh.


Lester Bowles Pearson: The minister laughs. The amount of $80 million tossed off by the minister to the unemployment insurance fund by order in council without, so far as we know, any statutory authorization. This is nothing to laugh at.


Donald Methuen Fleming: You had better read the statute then.


George James McIlraith: Why don't you explain it?


William Moore Benidickson: You tell us about it.


Lester Bowles Pearson: It was two days ago that questions were asked of the minister in this regard and since that time he has maintained a diplomatic silence.


Donald Methuen Fleming: That seems to annoy you.


Lester Bowles Pearson: We also say that section 20 of the act has been violated by the minister. The orders in council to which I have referred provide for the loans to be repaid "from the proceeds of sale of government of Canada direct and guaranteed bonds at the sole discretion of the Minister of Finance or from the cash resources of the fund". Section 20 of the act states:
Investment transactions . . . shall be made only on the authorization of an investment committee-
It is our contention, therefore, that the governor in council may not determine terms and conditions which permit the Minister of Finance to say when and if securities held by the fund are to be sold. Under the act that is a function which belongs only to
Unemployment Insurance Act the investment committee, the personnel of which we think might be altered in view of existing conditions. I am not talking about personalities because the members of the investment committee as personalities are highly qualified men of great integrity but the composition of the committee, as was pointed out by the hon. member for Kenora-Rainy River (Mr. Benidickson), might be improved in the way he indicated in an amendment. So much for the violation and, as we see it, evasion of the act.
Let me deal for a few moments, if I may, with our contention that this particular bill with its amendments was introduced by the government without proper consultation, without the consultation which should have taken place with the advisory committee, and that we in this house have been denied information we had a right to have in order to appraise the principle involved in the bill. We all know, Mr. Speaker-I mentioned it a few moments ago and I repeat it-that the unemployment insurance advisory committee has the responsibility under the act to report on the financial condition of the fund. We all know that in July, 1958, they made a very important, indeed a unanimous recommendation dealing with ways and means of replenishing the fund, the very matter we are discussing in the bill. The committee repeated that unanimous recommendation of July in the hidden report of August, 1958. Yet, Mr. Speaker, in the drafting of the bill, in the discussions leading up to the bill, in the discussion of the resolution preceding the bill, in the discussion on second reading of the bill, in everything pertaining to the bill, and in the preparation of this legislation there was no effort made to consult or discuss with the unemployment insurance advisory committee at any stage so far as we know.
So far as we know-we have asked this question and it has not been answered- there has been no meeting of any member of the government concerned with the preparation of this important bill with the unemployment insurance advisory committee, which is also concerned with these matters, since the report made by the committee to the minister last August. In other words, the committee has been by-passed. The government did not even wait to receive the annual report of the committee on the financial condition of the fund before introducing this measure.
As a result of what we consider to be the arrogant attitude of the government toward the committee and of the silence of the minister concerned during this debate, we are asked, without sufficient information,
3632	HOUSE OF
Unemployment Insurance Act to approve second reading of a bill to ensure the stability of this fund without knowing what is the exact financial condition of the fund. The only detailed information we have goes back to March 31, 1958, and this is May 1959.
Let me ask the government a few questions. What really happened to the fund during the fiscal year 1958-59? We do not know from the government. To what extent are the increased seasonal benefits responsible for the heavy drain on the fund? We do not know that. What were the amounts standing to the credit of the fund at March 31, 1959? We do not know that. What was the investment portfolio of the fund at March 31, 1959? We do not know that. When are we going to receive the answers to the questions asked by the hon. member for Essex East (Mr. Martin)? We do not know that. Yet, Mr. Speaker, we are being asked to approve the second reading of this bill whose main effect will be to increase the contributions of workers and employers to the unemployment insurance fund by, so far as we know, an average of approximately 30 per cent.
We have also raised another very important point in relation to the bill. It was done this afternoon by the hon. member for Kenora-Rainy River. I refer to the serious mismanagement of the fund during the last year which resulted in a loss of more than $10 million consequent upon the sale of government bonds at depressed prices. I suggest to the Minister of Finance and the Minister of Labour that this loss could certainly have been avoided if the fund had carried a larger share of its assets in more liquid treasury bills rather than in long term government bonds. That loss was not avoided because of the fact that debt management policy, that is, considerations concerning the lengthening of the public debt and the conversion loan, had a priority over liquidity for those who had the responsibility of deciding the investment transactions of the fund. Yet, Mr. Speaker, the probability of heavy drains during last winter was evident before midsummer when the conversion operation was launched by the government. Such a mismanagement by the government of the contributions made by the workers and employers to the fund surely cannot be tolerated by the house even if it is designed to help the government temporarily to get out of serious financial difficulties.
I should like to say a few words now about certain specific provisions of the bill. As I said at the beginning, some of these provisions are desirable and we on this side of the house are happy to support them. We support them generally; we would support


them in isolation. We accept the idea of adding two new classes of benefits and of extending the maximum duration of the benefit period from 36 weeks to 52 weeks. We also approve the proposal to increase the amount of allowable earnings and to provide a higher schedule of allowable earnings for the insured unemployed with dependants. We are also ready to support the more generous treatment given in the bill to convicts which we would hope would help in their rehabilitation.
All these improvements may be-indeed, I think are-important in the case of certain individuals but on the whole and in relation to some of the weaknesses and dangers inherent in some parts of the bill we think that these improvements are marginal. These improvements are not going to impose a heavy additional burden on the fund because the benefits they provide are not likely to exceed $20 million annually. The Minister of Labour will correct me if I am wrong in these facts, because we have to make these calculations from the information which we have. We certainly would have liked to know from the minister his estimate for the new benefits provided by this bill, how much they would come to in dollars and cents, but up to the moment we have not been given any indication in this respect.
Also, Mr. Speaker, we on this side accept the creation of two new classes of benefits. Since we do that, we must also, to preserve the insurance principle which is basic to this legislation, favour the addition of two new classes of contributors at the top. The raising of the income ceiling from $4,800 to $5,460 can in itself, I think, be approved by us. It will bring in, and again the minister can correct me if I am wrong in my figures, about 80,000 more workers. These two changes, we estimate, will result in increasing revenues to the fund, but again the minister did not give us any estimate of the increased revenues to the fund as a result of these two new provisions. I would be very surprised, Mr. Speaker, if the additional revenue would be materially lower than the marginal benefits provided under the bill.
We, on this side then, would be prepared to support these particular, and some of them are minor, modifications to the act. On the whole, the increased benefits they provide would be offset by substantially similar increases in contributions resulting from the additional two new classes and the raising of the income ceiling.
But there remains, Mr. Speaker, what we consider to be the main provision of this bill, which is the general increase of all

contributions, as we have estimated, by 30 per cent on the average. Here again, the minister has not given us any detailed information on this, but we estimate it at a 30 per cent increase on the average, without any corresponding increase in benefits to the insured. We cannot, Mr. Speaker, accept that main provision of the bill. It is surely analogous to a further increase in taxes. If these provisions were accepted by the house it would mean $70 million to $80 million extra in contributions, and this is the important point, and 80 per cent of that would come from the workers and employers. We must not forget-we should not forget it because it has been mentioned in this debate more than once-the nature of this fund. Only 20 per cent of this fund is contributed by the general taxpayers through the government, and 40 per cent comes from the workers and 40 per cent from the employers; that is the nature of the fund. Yet the Prime Minister, speaking on the program "The Nation's Business" on April 20, had this to say, and I quote from the text of the broadcast:
-we will be paying out this year $550 million more to Canadians in national health insurance, welfare and social security payments, than in 1956-7. the last year before we came into office- that is to say, twice as much as the tax increases.
I should like to analyse that particular calculation, Mr. Speaker, but I am sure you would rule me out of order. When I quoted it, that does not mean I accept it. Then, the Prime Minister went on to say this, and it does have a bearing on the unemployment insurance fund and the nature of it:
The $550 million does not include additional expenditures which will be made for unemployment insurance as a result of the extension of these benefits to more people and for longer periods.
Then, he added this:
Here alone, the additional cost will be $200 million more than in 1956-57.
In other words, the impression was given that the government out of its beneficent generosity was adding a $200 million payment to the workers of this country. If that is the right figure, then 80 per cent of that is being contributed by the workers and by the employers, and the government dares to take credit for 100 per cent of the $200 million increase in unemployment insurance contributions, on the basis of a fund to which they contributed only 20 per cent. The Prime Minister found it necessary to repeat that statement in a speech which he made in Montreal last week.
Mr. Speaker, I conclude where I began. We accept the necessity for the replenishment and strengthening of the fund. We know why that necessity has arisen. It has arisen because of the high level of unemployment.
Unemployment Insurance Act As of March 31, 525,000 men were out of work, that is on the lowest basis of calculation, and 700,000 had applications for unemployment insurance. The Prime Minister, in dealing with unemployment in his speech the other night in Montreal, said that Canada had made a quicker recovery from the recession than other countries. One of the important indices of recovery from a recession is surely the figures for unemployment. What do they prove? They prove that in Canada, as of March 31, 8.6 per cent of our labour force was unemployed, whereas in the United States it was 5.3 per cent and in the United Kingdom, 2.5 per cent. So far as unemployment is concerned, and we are dealing with unemployment in this bill, who dares to say we have made a quicker recovery from the recession than any other country?
As I said at the beginning, some of the provisions of this bill we can approve, and some of the principles in this bill we cannot approve. We most strongly disapprove of the circumstances surrounding the introduction of this bill, the contempt of parliament which has been shown by those circumstances, the withholding of vital information necessary-


Some hon. Members:: Hear, hear.


Lester Bowles Pearson: -to an intelligent consideration of this bill, and we deplore the fact that members of the government, in the discussion of a matter of this importance, have not even seen fit to answer the questions that have been addressed to them from this side.


Donald Methuen Fleming: Mr. Speaker, the Leader of the Opposition (Mr. Pearson) is in full retreat. Those of us who sat in this house last night and heard the hon. member for Laurier (Mr. Chevrier) engage in that fiery denunciation of everything connected with the bill and everything connected with the government, will find it very hard to reconcile the tone of the speech just now delivered by the Leader of the Opposition with anything that has preceded him from his fellow frontbenchers.


John George Diefenbaker: Overnight repentance.


Donald Methuen Fleming: Yes, there has been a measure of repentance here, and undoubtedly it is long overdue. How careful the Leader of the Opposition was to point out the good features of this bill. He went over them one by one, and sitting here one could not fail to be impressed by the fact there were a great many of them.


Lester Bowles Pearson: And a great many bad
features.

Unemployment Insurance Act


Donald Methuen Fleming: The evident enthusiasm displayed by the Leader of the Opposition for many of the features of this bill was such a touching demonstration after the anger and the spleen of last night and the night before. I can only say that this demonstration on the part of the Leader of the Opposition this afternoon must be very disturbing to his colleagues on either side of him.
This was a different approach from that of the hon. member for Essex East (Mr. Martin) in his wild paroxysm of Monday evening, and was such a contrast from the extraordinary outburst, even for him, of the hon. member for Laurier last evening and, finally, such a contrast from that master performer, the hon. member for Bonavista-Twillingate (Mr. Pickersgill), in his closing appearance before the curtain descended at 10 o'clock last night.


John Whitney Pickersgill: It was not my closing appearance.


Donald Methuen Fleming: Mr. Speaker, this is an interesting volte-face on the part of the opposition and I think we can begin to see the reason for it. The fact is that preceding speakers in the opposition, particularly those three eminent and wordy gentlemen whom I have mentioned, have gone so far away from the bill, have taken such flight from fact into the realm of fancy, that it behooved the Leader of the Opposition this afternoon to try somehow, if he could, to associate the party that he leads with the bill and some sense of rationality in approaching the provisions of the bill. He did not completely succeed in doing that but he has made an heroic effort even in the face of all the handicaps created for him by his associates on the front bench opposite.
Mr. Speaker, my participation in this debate will be on a quite limited aspect of the debate. My entry into the debate in that sense I intend shall be restricted to those matters which have been raised and which directly concern the relationship of the Minister of Finance to the administration of unemployment insurance as that has been discussed in this debate.
I venture to say, Mr. Speaker, that many members in this house, particularly the younger ones, are likely to be here for a very long time. It may be that some who are sitting in this house today will be here for many years to come. But whether they are here for 20 years, 30 years, 40 years or many more, no one will ever again hear in this house, I am sure, a speech the like of that delivered in this house by the hon. member for Essex East on Monday evening. My comment on that is necessarily restrained

because, where it concerns him, I must, of course, speak more in sorrow than in anger. That speech of his was, in my opinion, unique. It has established an all-time record in this parliament for the extent to which the pages of Hansard which it occupies are strewn with untrue statements, statistics that could come only from the Martin bureau of statistics-no other source would own them- and the extent to which, in paragraph after paragraph, the hon. member has jumped to conclusions that have no basis or justification and has followed the slippery course of leaping all over the place in making false charges based upon unwarranted conclusions based in turn on untrue statements.
Let me now, Mr. Speaker, set in their proper proportions the statute law and the steps that have been taken in this connection. Here let me invite the house to have regaid to the laws enacted by parliament. I venture to say that we shall not again hear in this house interpretations of the statute law of parliament the like of which we have heard in this debate. I hesitate to think that the reputation of some hon. members in the opposition in relation to the interpretation of statutes is to be governed and judged by what they have said in this debate.


John Whitney Pickersgill: I am rising on a point of order, Mr. Speaker. This side of the house has been kept to what we regard as the very narrow limits indeed of relevancy to the bill. The hon. gentleman has not yet mentioned the bill after having the floor for almost ten minutes.


An hon. Member:: That is not a point of order.


Mr. Speaker:: Does the hon. member suggest that comment on what has been said earlier in the debate is out of order?


John Whitney Pickersgill: I suggest that character
sketches of other hon. members are quite out of order.


An hon. Member:: Hogwash.


Paul Joseph James Martin: I rise on a point of order. The Minister of Labour was the one who started the argument which Your Honour, under his ruling, precluded us from continuing. What the Minister of Finance is now doing is what we endeavoured to do but which Your Honour decided we could not do.


Mr. Speaker:: I want to be consistent, by all means. The minister, I trust, is coming to the bill.


Donald Methuen Fleming: I shall continue on the bill and on the debate, Mr. Speaker.


Azellus Denis: Are you going to beat your own record?


Donald Methuen Fleming: I am going to beat, I hope, into their proper position the nonsensical, misleading and distorted arguments that have been put forward by hon. members opposite. I say that the recklessness demonstrated by hon. members opposite must surely be without precedent in this house. They have charged us with violations of an act. The Leader of the Opposition this afternoon backed away from that statement. Today he talked about evasions. He was careful to change his ground there this afternoon.


Lester Bowles Pearson: I rise on a point of order. The minister has quoted me and he has quoted me incorrectly. I charged the government this afternoon with both violations and evasions.


Donald Methuen Fleming: Is that not lovely, Mr. Speaker? We now have the Leader of the Opposition partly on the same track with his voluble colleagues on either side. He is just as wrong when he talks about evasions as he is when he talks about violations.
What is the statute law? There is no mystery about this matter. The terms of this act are plain. This act was enacted and has been on the statute books for some years. It amazes me that hon. members opposite or some of them could have been associated with the government that introduced this bill and that all of those of whom I am speaking could have been members of the government that was responsible for the administration for a couple of decades, and yet today know so little about the provisions of the Unemployment Insurance Act.
Let me take up a couple of provisions that were dwelt upon this afternoon by the Leader of the Opposition. He tried to make them sound so mysterious. I mention only three sections in so far as they bear upon the point raised by the Leader of the Opposition this afternoon and the charges he has made. Section 20 is the section which provides that investment transactions shall be made only on the authorization of an investment committee consisting of three persons, one nominated by the Minister of Labour, and that has been the assistant deputy minister of labour; second, one nominated by the Minister of Finance and this is, as it was under the former government, the deputy minister of finance; and, third, the governor of the Bank of Canada or an alternate whom he may appoint from among the deputy governors.
Unemployment Insurance Act


Lionel Chevrier: I rise on a point of order, Mr. Speaker. Last night I attempted to discuss at some length section 19 (1) and (2) and also pertinent parts of what the hon. member is now dealing with but Your Honour called me to order. I submit that the hon. member is in the same position that I was in.


Mr. Speaker:: I find it rather difficult to know how far my attempts to limit the discussion were successful. It is true that I restricted the hon. member. Yet I think the Leader of the Opposition today has dealt with this same matter.


Paul Joseph James Martin: That is what we were prevented from doing on our amendment.


Mr. Speaker:: I hope the minister will not attempt to deal with provisions of the act which the opposition was not permitted to discuss. But as I understand it, he is replying to the charges which have been made.


Donald Methuen Fleming: Mr. Speaker, I am replying to the-


Paul Joseph James Martin: I rise on a point of order.


Mr. Speaker:: May I hear just one at a time. I will hear the hon. member for Essex East.


Paul Joseph James Martin: That was the very point of the argument made to Mr. Speaker when he ruled that the amendment moved by the hon. member for Kenora-Rainy River was out of order. That amendment having been ruled out of order, the Minister of Finance, who observes the rules of the house so carefully, is himself now doing what we were prevented from doing. In this debate we have been held strictly to order and we are asking Your Honour to hold the hon. gentleman, under the same rules, strictly to order.


Mr. Speaker:: I am not sure I quite understand what is objected to. The hon. minister is naming the personnel of the investment committee. Is objection taken to that?


Lester Bowles Pearson: Mr. Speaker, when I dealt with that particular committee I dealt only with its activities in administering investments of that fund. I refrained from talking about any change in the composition of the committee which we thought should have been brought about because you ruled it out of order. Therefore I did not talk about the personnel of the committee at all.


Donald Methuen Fleming: I am not talking about a change in the personnel of the committee or about the subject matter of the

Unemployment Insurance Act amendment which was ruled out of order this afternoon. It was the Leader of the Opposition who referred to the clause and said that the Minister of Finance had violated it in what had been done, and I am answering what the hon. member said this afternoon. The hon. member for Essex East was not impeded in what he said on this matter the night before last. I am dealing with what the Leader of the Opposition said this afternoon-


John Whitney Pickersgill: Mr. Speaker, on a point of order-


Donald Methuen Fleming: Mr. Speaker, I hope this is not going to be taken out of my 40 minutes-


John Whitney Pickersgill: -the ruling on my hon. friend's amendment was that the investment committee was not relevant to the bill and could not be debated, nor be the subject of an amendment. I submit that if we were not allowed to debate it or make it the subject of an amendment, it is also incompetent for the minister to do what we were not allowed to do.


Mr. Speaker:: Unless the hon. minister is replying to the Leader of the Opposition, as I understood he was, and limiting his statement to what the Leader of the Opposition said, then I would consider that he would be going beyond the scope of the matter.


Donald Methuen Fleming: I have nothing more to say about section 20. I merely referred to its terms because the Leader of the Opposition said I proceeded illegally because the investment committee had not dealt with the matter of a loan to the unemployment insurance commission.


John Whitney Pickersgill: He did not say that at all.


Donald Methuen Fleming: That clause refers to investments, not loans.
Then I would point out the effect of the sections referred to by the Leader of the Opposition and also by the member for Kenora-Rainy River (Mr. Benidickson), who was not prevented from dealing with it fully in his speech. Section 85 is the provision under which the fund is created. The unemployment insurance fund is included within the consolidated revenue fund in view of the terms of sections 85 and 86 of this act, and the receipts, whether from contributions of employers, contributions of employees or the government contributions, go into that fund. The provisions of section 85 are the ones which deal with the crediting of those contributions and the payments out. May I point out that section 85 provides by clause 1 that:

To the extent that there are amounts standing to the credit of the unemployment insurance fund in the consolidated revenue fund not currently required for the purposes of this act the Minister of Finance shall, on the requisition of the commission, purchase obligations of, or guaranteed by, the government of Canada and pay therefor out of the consolidated revenue fund.
That is the provision under which all of the investments made by the unemployment insurance commission are made. The provision contemplates that those investments shall be made by the Minister of Finance on the requisition of the unemployment insurance commission, and the investments are confined to obligations of, or guaranteed by, the government of Canada. Then clause 2 provides that the payments made out of the consolidated revenue fund under subsection 1 shall be charged to the fund.


Some hon. Members:: Order.


Donald Methuen Fleming: Then we have provision also for the crediting of interest to the fund, and then this important provision-


Mr. Speaker:: Hon. members are calling order. If there is any point of order I would be glad to hear it.


Lionel Chevrier: I rise on a point of order, and I make the same point I made earlier, namely that the hon. minister should not refer to the section he is reading now because he is out of order to the same extent and in the same manner that I was last evening when I referred to a similar section.


Mr. Speaker:: I do not know how the wheat can be sorted from the chaff at this point, but it seems to me there was a charge made without restriction in the course of the debate as to the loans being made to the fund, and I assume the hon. minister is dealing with that point. If so, I will not restrict him in replying to the debate which took place on the two orders in council and on the financial transactions between the government and the fund, about which all members have spoken in this debate. Am I correct?


Donald Methuen Fleming: Entirely correct, Mr. Speaker.
In answering the Leader of the Opposition and what he had to say this afternoon to the effect-


Some hon. Members:: Sit down.


Donald Methuen Fleming: -that there was no statutory warrant in section 86 of this act for what the Minister of Finance did in relation to this loan, which is the basis for what I am about to say, I-


Mr. Marlin (Essex Easl):: Mr. Speaker, the hon. Minister of Finance (Mr. Fleming) in answer to your question said it is perfectly

in order, and the hon. Minister of Finance has demonstrated all day that he is a very unprejudiced witness in this matter. The fact is that when you were out of the house, Mr. Speaker, although you came in at one point, I was addressing myself to Mr. Speaker in respect to an amendment moved by the hon. member for Kenora-Rainy River (Mr. Beni-dickson) which asked this house to change the composition of the investment committee to guarantee the integrity of the unemployment insurance fund.


Mr. Speaker:: Yes, I am aware of that.


Paul Joseph James Martin: Your Honour says he is aware of that, and I sincerely hope that is the case.


Donald Methuen Fleming: Shame.


Mr. Speaker:: I heard the result of the debate. I did not intervene because it was in process, but I have the amendment before me and I have read it, and the hon. member can proceed knowing that I do know of it.


Peter Francis Martin: As a result of the non-acceptance by the Speaker of that amendment we were precluded from carrying on the argument which that amendment suggested, and arguments based on the proposal made in that amendment. What the Minister of Finance is now doing is proceeding to debate and seeking to justify a priori something we were denied doing.
Business of the House


Donald Methuen Fleming: Not at all.


Murdo William Martin: We were held strictly to account in this debate, and we therefore have no other course but to ask the Minister of Finance to also observe the rules of this house and the decisions of the Speaker.


Some hon. Members:: Oh, oh.


Mr. Speaker:: The hon. member can rest assured that I will not permit the minister to proceed upon lines along which the opposition were ruled out of order. However, I see it is now six o'clock and I think this might be an opportune time to adjourn.



BUSINESS OF THE HOUSE

Lionel Chevrier: May I inquire from the acting house leader what the business of the house is for tomorrow?


Mr. Brooks:: Tomorrow we will continue with the unemployment insurance debate, and when it ends go on with the labour estimates. Then we shall continue with the public works estimates.


Lionel Chevrier: Mr. Speaker, may I get some indication from the acting leader of the house what the business is for Monday?


Alfred Johnson Brooks: I am sorry but I cannot give you that now.


[Stage Direction]
At six o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Questions
ANSWERS TO QUESTIONS	3. Answered by 2.
The following answers, deposited with the Clerk of the house, are printed in the official report of debates pursuant to standing order 39:

[Stage Direction]
Question No. 3S1-Mr. Badanai:
1.	Is the armoury building in Fort William which has been closed since the middle of March, still being heated?
2.	Is the building going to be demolished in the near future?
3.	If not, what is the government going to do with it?
Answer by: Hon. Henri Courlemanche (Secretary of State):
1.	No.
2.	Crown Assets Disposal Corporation has advertised for offers for the demolition and removal of the building from the site with a closing date of May 20 for the receipt of bids.

Mr. Carter: 1.	For a wing commander at maximum pay with a wife and five children (ages 1, 3, 5, 8, and 10 years) and a wing commander at maximum pay with a wife and three children (ages 2, 6, and 8 years) living in public married quarters in England during a four years overseas tour of duty, what is the amount for the four year period of: (a) the gross loss in family allowances; (b) the offsetting saving in income tax; (c) the total of additional allowances payable in England which are not received by a serviceman of similar rank in married quarters in Canada, and which are peculiar to married personnel as distinct from single personnel?
2.	What are the comparable figures for (a), (b), and (c) above for sergeants at maximum pay with similar families?
3.	What are the comparable figures for (a), (b) and (c) above for leading aircraftsmen at maximum pay with similar families?
Answer by: Hon. G. R. Pearkes (Minister of National Defence):
1, 2 and 3-See attached table.
(a)	(b)	(c)
The total of additional allowances
Question Part	Rank	Number of children	The gross loss in family allowances	The received by a serviceman of similar offsetting rank in married quarters in Canada, saving in and which are peculiar to married income tax personnel as distinct from single personnel	i	Wing commander	... 5	$ 1,584.00	$ 998.40	Nili	Wing commander	... 3	912.00	595.20	Nil2	Sergeant	... 5	1,584.00	310.08	Nil2	Sergeant	... 3	912.00	398.88	Nil3	Leading aircraftsman....	... 5	1,584.00	16.80	Nil3	Leading aircraftsman....	... 3	912.00	278.88	Nil
Note-The above figures do not take account of foreign allowance payable to both single and married servicemen in England which amounts in a four year overseas tour of duty to the following:
Wing commander	 $ 1,296.00
Sergeant	 576.00
Leading aircraftsman	 432.00

Thursday, May 14, 1959