1959-07-18

Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, with the leave of the house 1 would like to say a few words in respect of one portion of the legislative program, and in particular to answer the question asked a few days ago by the hon. member for Skeena (Mr. Howard).
This has been a long and, I think, very productive session. There have been more committees sitting than was the case at any time during the years I have been here. I think it would be generally admitted by members in all parts of the house that the work done by those committees has been comprehensive and helpful. The membership of the various committees have been most diligent in the discharge of their responsibilities.
I am not one of those who through the years have advocated the extension of the committee system, but I do feel, while maintaining to the strictest degree our parliamentary system and in no way adopting the system in effect in the United States of America, which meets the needs of that country, this session has shown the benefits that flow from the mobilization of the help of private members everywhere in the house.
I say that as a preface to my remarks in respect of the bill of rights. I am in no way changed in my view as to the necessity of a bill of rights being passed by parliament, and the experience in government in no way has lessened my feelings as to the necessity of such a bill.
As hon. members know, a draft bill was introduced in the concluding days of the last session with a view to assuring that the fullest possible representations might be made by interested bodies, groups and individuals. In that respect there have been many such representations made by private individuals as well as by institutions such as civil rights organizations in various parts of the country and the Canadian Bar Association.
I believe it is generally accepted by hon. members that when the bill of rights finally
passes it shall be as comprehensive and allinclusive as the constitution will permit. Representations and suggestions are being received even now; and while I expressed the view some months ago that there was no necessity, as I saw it then, for a committee of both houses to consider the matter fully in so far as the terms of the suggested bill are concerned, in the light of representations made since I have altered my viewpoint, as I hope I always will when reason demands a change.
I have come to the conclusion that it would be well to have the draft bill of rights submitted to a joint committee of both houses, that committee to consider no other question than the terminology of the bill. As I see it, the question as to the need of a bill of rights would not be a subject for consideration by the committee. Such a committee would provide the fullest possible opportunity for further discussion and consideration, to the end that when the bill is enacted this historic step in the maintenance and preservation of freedom under law will be the most significant that parliament can attain through^ joint counsel and consideration.
In saying that I want to make clear that from the suggestion I have to offer to postpone the introduction of the bill of rights until the beginning of the next session, no one is to take that postponement as any indication of less allegiance on the part of the government and myself to the paramount need of this legislation being passed. Therefore under the circumstances I am going to suggest that the bill of rights already drafted be brought up at the next session at the earhest possible date, and that a joint committee for the purposes I have mentioned be then set up. Even though my views changed during the progress of the present session as to the benefits that might flow from the setting up of such a committee, I realized that with the number of committees that were sitting it would be next to impossible at this session to set up still another committee.


Hon. L. B. Pearson (Leader of the Opposition):: Mr. Speaker, while we on this side are as anxious as ever to do everything that is possible to maintain and strengthen human rights and fundamental freedoms to the maximum possible extent, we feel that the procedure outlined by the Prime Minister is a practical one, all the more so because we
8294	HOUSE OF
Miscellaneous Private Bills Report have thought from the beginning that this matter should be submitted to a joint committee of parliament for full and comprehensive consideration.


Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, this group was very interested to hear the Prime Minister's announcement with respect to the postponement of the introduction of this bill of rights until next session.
I must say we were pleased to learn he has responded favourably to the representations made from many quarters for this bill to be referred to a committee of both houses. We are very anxious that this important document be the product of consultation and cooperation among all interested persons in this country.
In conclusion, I hope the Prime Minister has this legislation introduced early in the next session.


John George Diefenbaker: I thank hon. gentlemen for what they have said. So there will be no misunderstanding as to the words I used about the procedure, a draft bill will be submitted, and the plan I have in mind is for the introduction of the bill in this house and after discussion and second reading it will be submitted to a committee, to the end that the objectives that have been mentioned by the hon. member for Kootenay West may be attained.
miscellaneous private bills



CONCURRENCE IN TWENTY-THIRD REPORT OF STANDING COMMITTEE

[Stage Direction]
Mr. R. J. McCleave (Halifax) presented the twenty-third report of the standing committee on miscellaneous private bills and moved that the report be concurred in.
Mr. G. J. Mcllrailh (Ottawa West):: Mr. Speaker, there is just one point I want to raise very briefly about the report, and it is this. I am not clear about the right of the committee to make a report of this nature when it is a standing committee dealing with particular bills referred to it, and only that. This is the only observation I wish to make on the subject. I feel this should be drawn to the attention of the house, because if standing committees are to make reports that go beyond the reference to them we could get into a great deal of difficulty. I am not clear as to whether or not this report goes beyond the reference to the committee, but I question it very much. It may be that the report is within the reference to the committee, but I wanted to raise that question.


Mr. Speaker:: Subject to the remarks made by the hon. member for Ottawa West, is it the pleasure of the house to adopt the motion?


[Stage Direction]
Motion agreed to.


Hon. A. J. Brooks (Minister of Veterans Affairs):: Mr. Speaker, I wish to make an announcement with reference to the New Brunswick fishermen's disaster fund. Hon. members will recall that a few weeks ago a terrific storm struck the coast of New Brunswick along the Northumberland strait taking the lives of 35 fishermen and destroying boats and equipment worth in the vicinity of $750,000. Most of those who lost their lives were heads of families, and as a result some 20 widows, 4 mothers and 83 children are left unprovided for and practically destitute.
A fund has been started in the province known as the New Brunswick fishermen's disaster fund, to which I have the honour to report that the federal government is contributing $50,000. I know, Mr. Speaker, that I speak for all those concerned when I say we are very grateful for this generous contribution.


Mr. G. R. McWilliam (Norihumberland-Miramichi):: I am sure the house and the country will welcome the announcement just made by the Minister of Veterans Affairs. We appreciate the generosity of the government in making a grant of $50,000 to the New Brunswick disaster relief fund. On behalf of the people of Northumberland-Miramichi and, I might say, all the people of New Brunswick, I wish to express their appreciation for the generous gift.



UNEMPLOYMENT INSURANCE


[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: May I ask the Prime Minister whether it is a fact, as stated by the Canadian Labour Congress, that at a meeting oh July 3 between the Prime Minister and representatives of the congress there was an agreement that when consultation with the Canadian Labour Congress is required in appointments of labour representatives to government organizations, this means that if the labour nominee is not acceptable to the

government, the Canadian Labour Congress will be so informed and will be asked to submit other nominees?


John George Diefenbaker: I mentioned yesterday that there had been discussions with respect to the whole question of appointments with regard to which consultation is to take place. Following discussions in my office the Minister of Labour (Mr. Starr) met with the president of the organization and, I think, one or two other officials. Unfortunately he is not here today to give the information asked for by the hon. gentleman.


Hon. Paul Martin (Essex East):: I have a supplementary question in view of the importance of this matter. Has the Prime Minister taken into consideration the implications of section 86 of the Unemployment Insurance Act, which requires consultation with labour in respect of appointments made to the unemployment insurance advisory commission?


John George Diefenbaker: The government has
always taken into consideration that section and the tenor of that section. Indeed, so far has this government gone in pursuance of its promises that as to any commission or board set up, entirely apart from any statutory provision it is required on our part that representation of labour be on all commissions and the like in respect of which labour has an interest. The same principle of consultation applies as to appointments made for industry or representatives of industry. The same course has been followed in that regard. Names have been asked for pursuant to the principle of consultation, and following that the decision as to who should be chosen must necessarily, following consultation, be the determination of the governor in council.


Paul Joseph James Martin: Violation of the act.



SASKATCHEWAN


[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: Mr. Speaker, the apparently impossible has become the inevitable. I am about to ask the Minister of Trade and Commerce a question on box cars. My question arises out of telegrams and letters received this morning from Saskatchewan pool elevator committees protesting the action of the C.P.R. in refusing to supply box cars to Saskatchewan wheat pool elevators for shipment of wheat to the 66968-9-399
Inquiries of the Ministry lakehead. This refusal, they state, is a discrimination against the farmer-owned elevator system, which is not getting its share of box cars, and is contrary to the recommendations of both the Bracken commission and the agriculture committee of this house regarding the right of the producer to deliver grain to the elevator of his choice and, I presume, in some cases of her choice.
Will the minister assure the house that he will take immediate action to investigate this situation and have the embargo order rescinded, so that all companies may handle the business earned by them?


Hon. Gordon Churchill (Minister of Trade and Commerce):: I thank the hon. member for giving me notice of this question. I can assure him that the situation will be investigated immediately. I also repeat my assurance of some time ago, that before the house rises I will make an announcement concerning the box car situation and regulations governing the same for the crop year commencing August 1.



SHIPPING


[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Port Arthur):: I should like to direct a question to the Minister of Transport. What information and what views has the minister on the protest made to the U.S. state department by United States pilots over the alleged raiding of United States pilotage jurisdiction by the Canadian government in placing a Canadian pilot aboard the steamer Harry Coulby at Cape Vincent, New York, on July 1, 1959?


Hon. George H. Hees (Minister of Transport):: I wish to thank the hon. member for giving me notice of this question, which I received just before coming into the house. I have not seen this report and am not aware of the situation, but I will look into it.


Douglas Mason Fisher: May I ask a supplementary question. Is the minister aware that the great lakes district, international organization of masters, mates and pilots, which is the United States organization, has forwarded a demand to the United States state department that the state department take action to bar Canadian pilots from St. Regis to Wilson island, the Soo locks and lake Michigan in its entirety, as both these are strictly United States waters, no part being Canadian?


George Harris Hees: No, Mr. Speaker.

Inquiries of the Ministry NATIONAL DEFENCE



REPORTED STATEMENT RESPECTING U.S. STOCKPILING OF ATOMIC WEAPONS IN CANADA

[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: I would like to ask the Prime Minister whether he cares to comment on a statement, which appeared in the press this morning, by the assistant to United States defence secretary McElroy before the joint congressional committee on atomic energy yesterday in Washington, that the United States has made it clear that it is ready to stockpile atomic weapons in Canada, but that full control and custody of those weapons must rest with the United States?


John George Diefenbaker: Mr. Speaker, I am not in a position to comment on that statement. This is one of those matters which require more than an offhand answer. I have had no notice of it, and therefore cannot go into detail.



LONGUE POINTE, MONTREAL    LAY-OFFS AT ORDNANCE DEPOT

[Stage Direction]
On the orders of the day:
Mr. J. P. Deschateleis (Maisonneuve-Rose-mont):: Mr. Speaker, I should like to direct a question to the Minister of National Defence, but in his absence I hope the Minister of Defence Production will be able to give a reply. Is the minister aware that hundreds of employees of the ordnance depot at Longue Pointe, Montreal, have been laid off recently? If so, would the minister comment on the rumour that this plant, employing thousands of men, will eventually close?


Hon. Raymond O'Hurley (Minister of Defence Production):: Mr. Speaker, this is a question which should be directed to the Minister of National Defence. I am not aware of the circumstances the hon. member has mentioned, but I will bring this matter to the attention of the Minister of National Defence.



INQUIRY AS TO DISPOSITION AND TREATMENT OF ADDICTS

[Stage Direction]
On the orders of the day:
Mr. Frank Howard (Skeena):: I would like to pose a question to the Minister of Justice. On Thursday, July 16, during the minister's absence while with Her Majesty, I asked the question which appears on page 6102 of Hansard with respect to an investigation which is apparently under way in metropolitan Toronto in so far as treatment of narcotic addicts

is concerned. I wonder if the minister can give some indication now of the position of the federal government.


Hon. E. D. Fulton (Minister of Justice):: Mr. Speaker, as I recall it when the question was asked it was dealt with by my colleague the Minister of National Health and Welfare, and so I did not prepare a formal answer myself. However, I have been following the matter, and my department has also been following with interest the developments in Toronto. As things stand at present that inquiry is proceeding and I think should proceed on the basis that it is the responsibility of the metropolitan Toronto authorities alone. There are reasons for this which my hon. friend will appreciate, the principal one being that there are other matters being investigated besides drug addiction. While at the moment we are not taking any part in it, I can assure my hon. friend that we will follow with interest the results and findings of that investigation so far as the problem of addiction is concerned.



CITIZENSHIP AND IMMIGRATION


[Stage Direction]
On the orders of the day:
Douglas Mason Fisher: Mr. Speaker, in case this should be the last day of the session I would like to give the Minister of Citizenship and Immigration the opportunity to clear her name of a charge which has been circulated in Ottawa, to the effect that she has used her position and her attachment to a certain organization to enable a certain young man to get his citizenship papers in a hurry, whereas another young man from another part of Canada has not been able to get his papers.


Hon. Ellen L. Fairclough (Minister of Citizenship and Immigration):: Mr. Speaker, the young man who qualified did so under the Immigration Act. The young man who did not qualify was disqualified under the provisions of the Immigration Act.


Douglas Mason Fisher: A supplementary question. So it has nothing whatever to do with the Hamilton Tiger Cats football team?


Ellen Louks Fairclough: Mr. Speaker, I made an error; I should have said the Citizenship Act, not the Immigration Act. With reference to the last comment of the hon. member, the answer is no; but naturally as a fan I cannot help but feel gratified that there was a favourable result.



DEFENCE PRODUCTION


[Stage Direction]
On the orders of the day:
Donat Raymond: Mr. Speaker, during consideration of my department's estimates on July 9 the hon. member for Bonavista-Twillingate asked two questions, and seeing that we were both in a co-operative mood that night I promised to provide an answer before the end of the session.
His first request was for an estimate of the increased expenditures on general procurement resulting from the establishment of Camp Gagetown. I have now obtained figures for all purchases made in the Atlantic provinces during the fiscal years 1957-58 and 1958-59 which are known to have been destined for Camp Gagetown. For 1957-58 the total was $3,046,479 and for 1958-59, $3,504,354. I have here a table showing the breakdown of these figures by categories, which the hon. member might wish to have incorporated in the record. These figures do not include the value of supplies such as tinned food or clothing and footwear which may have been purchased in the Atlantic provinces for delivery to depots in central Canada and subsequently issued to the camp, since these are not readily identifiable. On the other hand, the figures do include local purchases made directly by the army units stationed at Camp Gagetown.
As the hon. member will notice, the increase from 1957-58 to 1958-59 was slightly less than $500,000, which is only about 7 per cent of the total increase in our purchasing in the Atlantic provinces, as I reported on June 3 and July 9. The ration strength of the camp was, in fact, lower in 1958-59 than in 1957-58. Consequently, although it may be true, as the hon. member for Bonavista-Twillingate suggested, that the establishment of the camp had a stimulating effect on the economy of the area, this does not account for any of the increase in our purchases within the Atlantic provinces in 1958-59.
The other question was what proportion of the expenditures for the Atlantic provinces in the last fiscal year was spent in the province of Newfoundland. The answer to this is 4.1 per cent.
I request permission to have this table printed in Hansard.


Mr. Speaker:: Has the minister leave to incorporate the balance of his answer in Hansard?


Some hon. Members:: Agreed.
66968-9-399J
Inquiries of the Ministry [Editor's note: The table above referred to is as follows]
Purchases in the Atlantic Provinces wn
1957-58	1958-59
20,500	16,500
1,358	2,636
203	514
1,261,695	1,113,783
520,165	574,240
8,789	1,165
54,161	68,507
45,416	60,033
707	2,900
310,524	203,368
390,443	567,155
56,851	31,676
375,667	861,877


Hon. J. W. Pickersgill (Bonavisla-Twillin-gate):: A supplementary question, Mr. Speaker. It is quite evident from these figures that the establishment at Gagetown has in fact been a great stimulus to the economy of the region, but the minister suggested in his answer that clothing, shoes and things of that sort might be bought in the Atlantic provinces, transported to a depot in central Canada and sent back to the camp again for issue to the troops there. Surely this government does not indulge in practices of that kind.


Mr. Speaker:: Is the hon. member framing a question or making a statement?



CANADIAN NATIONAL RAILWAYS


[Stage Direction]
On the orders of the day:
Hon. Lionel Chevrier (Laurier):: Mr. Speaker, may I ask the Minister of Transport if he has had time to obtain a reply to the question I asked yesterday concerning layoffs in the districts of Quebec, Charny and Chicoutimi?


George Harris Hees: No, Mr. Speaker, I have communicated with the Canadian National Railways but their offices are closed this morning, and we have not received an answer.
[Later:!


Lionel Chevrier: Mr. Speaker, may I direct a question to the Minister of Transport. When he is asking the Canadian National Railways for information in connection with lay-offs in the Quebec district, would he also be good enough to inquire whether in the district of Mirror, Alberta, there have been considerable lay-offs within the last twelve months
for Camp Gage
Barrack equipment and furniture repairs	
Clothing	
Communication equipment
spares	
Food	
Fuel and fuel hauling	
Heavy equipment spares	
Laundry and dry cleaning_____
Mechanical transport spares
and batteries	
Photographic and medical supplies	
Petroleum, oil, lubricants and
associated products	
Sanitation services and supplies
Vehicle repairs	
Building materials	

Inquiries of the Ministry which have reduced the personnel from 172 to well below 100. Would he inquire from the C.N.R. whether there is any opportunity of taking these men back in some form of employment or other and, if not, whether the government is able to do anything for these men.


George Harris Hees: I shall be very glad to make that inquiry, Mr. Speaker.



SECRETARY OF STATE


[Stage Direction]
On the orders of the day:
Lionel Chevrier: Mr. Speaker, may I ask the Secretary of State if he intends to make a statement in connection with one of the matters which was under discussion during consideration of his estimates last night and on which he undertook to give the house a statement, concerning contracts for binders?
(Translation):


Hon. Henri Couriemanche (Secretary of State):: Mr. Speaker, I am quite prepared to give the information; unfortunately, the house adjourned so very late last night that I could not get in touch with the officials who could supply me with the required information.


Lionel Chevrier: Will the minister reply before the end of the day?


Henri Courtemanche: I shall try, Mr. Speaker. (Text):



INQUIRY FOR RETURN


[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: Mr. Speaker, I wish to direct a question to the Secretary of State. On July 1, in question No. 484, I asked certain questions with respect to the Department of National Revenue. In view of the fact that I asked the questions in the hope of getting arguments to use on the minister's estimates today, is there any possibility of this information being given to me today, before the minister's estimates are concluded?
(Translation):


Henri Courtemanche: Mr. Speaker, I shall look into it, and if it is at all possible to table the requested document, I shall be pleased to do so.


(Text):



PUBLIC SERVICE


[Stage Direction]
On the orders of the day:
Mr. Alexis Caron (Hull):: Mr. Speaker, in all sympathy for the Secretary of State, would the Prime Minister consider giving him the help he needs through the appointment of a queen's printer in the near future?


Lionel Chevrier: Mr. Speaker, I believe that question deserves a reply. In other words, when does the Prime Minister, under whose jurisdiction I believe this appointment comes, intend to make this appointment?


John George Diefenbaker: Mr. Speaker, I have heard the question and the answer is "shortly".



POST OFFICE DEPARTMENT


[Stage Direction]
On the orders of the day:
Mr. J. R. Tucker (Trinity-Conception):: Mr. Speaker, may I direct a question to the Postmaster General. I have just noticed that the town of Liverpool in Nova Scotia this year celebrates its 200th anniversary. May I ask the minister if his department has considered bringing out a special postage stamp to commemorate the 200th anniversary of that town?


Hon. W. M. Hamilton (Postmaster General):: No, Mr. Speaker. The hon. gentleman is a little late in making his request.



AGRICULTURE


[Stage Direction]
On the orders of the day:
Paul Joseph James Martin: Mr. Speaker, may I ask the Prime Minister or the Minister of Agriculture on this the last or nearly the last day of this session whether the government has yet reached a policy arising out of the demands and representation made by two delegations, one of them a very large one and another a smaller representative delegation from western Canada, asking for deficiency payments on wheat, oats and barley? The house will recall that on June 15 the Prime Minister said that the government had not yet arrived at its policy with regard to this matter.
Right Hon. J. G. Diefenbaker (Prime
Minister): Mr. Speaker, the answer of June 15 still stands.


Paul Joseph James Martin: This is such an important matter, may I ask a supplementary question. Does that mean parliament will

not be given the opportunity of knowing the answer the government makes to these very important delegations of over 1,000 farmers from western Canada?


John George Diefenbaker: Mr. Speaker, I can only say that if parliament is sitting at the time the decision is made, the announcement will be made in the house.



FREIGHT RATES


[Stage Direction]
On the orders of the day:
Mr. M. W. Martin (Timmins):: Mr. Speaker, I wish to direct a question to the Minister of Transport. I hope this is in his jurisdiction, but I must confess I am not sure. Could the minister say whether any representations have been made to the federal government requesting a subsidy on freight rates on fertilizer and farm equipment going into northern Ontario? If so, what consideration has been given to this request?


George Harris Hees: Mr. Speaker, I wish to thank the hon. member for giving me notice of his intention to ask this question. However, I received it only on coming into the house. I have not received any such representations myself, but I will be very glad to make inquiries in my department.

The house in committee of supply, Mr. Sevigny in the chair.
DEPARTMENT OF NATIONAL REVENUE Customs and excise divisions-
254. General administration, $4,317,418.


The Chairman:: This item will be found on page 53 of the blue book, and the details on page 350.


Hon.   George. C. Nowlan@Minisier of National Revenue: Mr. Chairman, this item deals with the Department of National Revenue, customs and excise divisions. The estimates of this department have been before the committee on estimates, and several days were spent in a discussion of them. I do not propose at this time to make any lengthy preliminary statement on the item. The item deals with the employees, the revenues and all the other activities of the department.
I do not propose to make a statement, but I do want to point out at the moment what is known to all hon. members, namely that 95 per cent of the item is for salaries. I also want to point out that this is one department, despite increases in salaries and
Supply-National Revenue increasing responsibilities, in the over-all estimate shows a reduction as compared to last year, which I think is possibly some indication of the efficiency of the department and also, I must say, due to the improvement in modem methods of computation, and so on.
We have had reports from the committee, investigating the civil service commission, et al, and as a result certain official practices have been brought up to date. I do not think at this time the committee would be interested in hearing any statement from me. I would be very glad, of course, to try to supply answers to any questions or to reply to comments that come up during the discussion.


Lester Bowles Pearson: As the minister has said, these estimates received thorough and exhaustive examination in the committee on estimates. Perhaps that will make it unnecessary to spend the time on these estimates that would otherwise be required. If there is only a short time devoted to them it should not lead to any misunderstanding, because it should be known that they have already received very careful examination.


[Stage Direction]
Item agreed to.

[Stage Direction]
43. Grant in respect of the net operating requirements of the radio and television services, $58,404,000.
Lester Bowles Pearson: Is the minister going to make a statement on the C.B.C. at this time? Is this the item?


Mr. Nowlan:: We are moving along so rapidly that I did not realize we had reached this one. The taxation officials must be out of breath trying to race downstairs before we carried the items of national revenue and taxation.


Lionel Chevrier: I hope they do not break their necks.


George Clyde Nowlan: That is a more charitable attitude than probably some taxpayers of this country take.
I have not any prepared statement, Mr. Chairman, in so far as the C.B.C. is concerned. I really did not expect that we would get to this point quite so rapidly in the morning, though I am very thankful that we did.
The Canadian Broadcasting Corporation has been the subject of considerable newspaper comment during the past six months. It has been before the committee on broadcasting and had an exhaustive review. I will not say "exhaustive" because I understand the committee has suggested that it still wants to conduct further studies with respect to it; but this has been a year in which the C.B.C.



MOUSE OF

[Stage Direction]
Supply-National Revenue has probably attracted as much publicity, been involved in as many difficulties and subjected to as much criticism, shall I say, and also as much commendation as any year in the corporation's history. It has been a year of stress and strain. Of the two leading executive officers, one has been stricken with a heart attack and the other one is worn out with exhaustion. It has been a year which certainly will always be remembered, I am sure, by the corporation, and I do not think there is any real purpose that can be served by my discussing the matter at this time. However, there is a statement I do want to make with respect to the C.B.C. and broadcasting which I think should be given to the committee before detailed consideration is given to the estimates.
Hon. members will recall that the previous government in December, 1952 laid down a policy of permitting only one television station in each area, except where there was to be one each in the French and the English languages. This policy was apparently intended to assist in developing and conserving commercial revenue, and also to support an industry which was very expensive and which at that time, at any rate, was in an experimental stage. That policy was criticized by members of the Conservative party then in opposition, and it was criticized as having a monopolistic tendency.
Since the present government took office it has carefully re-examined the situation with a view to changing the previous policy to one of competition and greater freedom. First it was necessary, of course, to establish the board of broadcast governors as an independent regulatory body. This has now been done. It was necessary to assess the general position of both the C.B.C. and private broadcasters in the light of present circumstances and in the light of the whole review made by the royal commission, which reported in 1957. It may be recalled that that commission recommended the abandonment -I want to emphasize this-of the old single station policy and the licensing of competing stations, subject to suitable conditions. In addition, the commission warned of certain problems and difficulties which will no doubt be in the minds of any who seek licences to establish new stations, as well as those who grant such licences.
The establishment of new competing stations in the larger centres of population will no doubt affect the commercial revenues of those now operating there and will, of course, affect particularly perhaps the Canadian Broadcasting Corporation revenues. We are all very conscious of the problems in the financing of the C.B.C. and the difficulties
[Mr. Nowlan.I
[Stage Direction]
it faces in obtaining commercial revenues. On the other hand we believe competition will be of benefit to the consumers of television services, that is to the Canadian people who pay for the services one way or another. We believe also that it will be a spur to improve the efficiency of both private and public operators.
In that connection I might interpolate in my prepared statement and venture to suggest that there has been a great deal of criticism of the C.B.C. for carrying on a certain type of program service. There are those, of course, who think this type of program should be dropped and that type of program should be dropped, but I suggest to this committee that as long as the government maintains the single station policy, then I would think it is almost essential that the Canadian Broadcasting Corporation has to carry out this broad basis of programming because no other facilities provide them. Once you do get competing services it is possible-and I emphasize "possible"-that the C.B.C. will be in a position to deal with the new problems which arise.
The government has consequently decided that as from September 15, 1959 it will be prepared to consider applications for additional television broadcasting stations in areas already provided with television service. These applications should be made to the Department of Transport in the normal way for checking all their technical features under the Radio Act. They will then be passed to the board of broadcast governors for hearing and decision under the Broadcasting Act. They will finally require, of course, the approval of the government in accordance with that act. Under the policy I am now announcing the government will now be prepared to give that approval if all those previous requisite conditions are met.
It may well be that the size of the market to be served will not justify additional stations in many of the areas already served, and where people are hopeful of obtaining additional licences. This is a matter which the board of broadcast governors no doubt will wish to take carefully into account in considering the proposals which may be put before it. Nevertheless, as time goes on it may be assumed that more and more areas in Canada will justify a second station.
I think, Mr. Chairman, that is all I wish to say at the moment. I know there will be many queries and comments and I shall be prepared to deal with those later, of course.
Lester Bowles Pearson: Mr. Chairman, the almost
spectacular speed which was shown a few minutes ago in completing the minister's estimates will perhaps be less noticeable in the

consideration of C.B.C. matters, because even at this stage of the session-and I wish it could have been earlier-some attention must be given to this very important matter. We discuss the affairs of the Canadian Broadcasting Corporation and broadcasting in Canada at a time of great anxiety about the future of a national broadcasting system in this country, an anxiety the responsibility for which, I suggest, should be shared between the government and the C.B.C. itself.
That principle I have mentioned, one national broadcasting system with its public and private sectors, is basic to our approach to this whole matter. I think it is also the approach of the minister, and anything I may say in criticism of recent policies should not be interpreted as suggesting that I do not have confidence in the minister's approach to what I consider to be basic, as I have said, to the problem of broadcasting in Canada. I think we on this side appreciate his views and the way he has tried to carry them out in this fundamental matter.
We think it essential, Mr. Chairman, that the publicly owned and operated sector of this national system, which is the Canadian Broadcasting Corporation, should be free from every form of unjustifiable influence or pressure, including, indeed, special pressure from government. To achieve the purpose I have mentioned of establishing a strong and independent national broadcasting system, as independent as such a system can be, subject always to parliamentary control of general policy-because I do not suggest for a minute that independence should go as far as to exclude parliamentary control-the Canadian Broadcasting Corporation, as the Fowler commission pointed out a few years ago, must have reasonable financial security, some certainty of at least a basic income over a longer time than the period of one year. It must also display administrative efficiency, and that in its turn implies maximum freedom from political pressures. The Fowler commission also stressed that point.
So far as the first matter is concerned, finance, in other days the Canadian Broadcasting Corporation had certain revenues assured by statute though, of course, especially in recent years, they were supplemented by parliamentary votes. That is no longer the case. The minister and the committee will recall that the Fowler commission was appointed primarily to investigate these questions of administration and finance, and it did make a very careful and exhaustive examination into these matters. As a result of that examination the commission report condemned the system of annual parliamentary grants on which the corporation would have largely to rely.
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The minister will remember that we joined in that condemnation in the discussion we had of broadcasting affairs last August, when the present act was introduced into the house. The Fowler commission pointed out, as we tried to point out then, the danger of the Canadian Broadcasting Corporation being forced to go each year to the Minister of Finance and beg for the means of its existence without having any other source of revenue except that which came from commercial income. We felt then and we feel now that this uncertainty and insecurity should be removed to the maximum possible extent, and that the corporation should be given some assurance of a fixed income over a longer period than one year and told to live within that income.
The present act which was passed last year, in section 35, subsection 1, I think, gives the Minister of Finance more control over the affairs of the C.B.C. than was previously the case. Before the C.B.C. annual budget goes to cabinet it must be approved by the Minister of Finance as well as by the minister responsible for C.B.C. affairs, the Minister of National Revenue. Last year when we were considering this aspect of the matter in the house we pointed out, as will be found in my statement recorded on page 4053 of Hansard:
We fear that using this system of annual appropriations and nothing else under a government not too enthusiastic about the C.B.C. . . . the activities and the necessary expansion of the corporation could be prejudiced and the power of the purse used annually could impose the views of government in a field where this kind of interference could be damaging to the right of the people to be informed objectively.
Nothing has happened since that time to remove our fears on that score. That leads me to the second important aspect of this problem, how to establish administrative efficiency and that which must go along with it, reasonable political independence; not, I repeat, independence of parliament, because no one desires that, but independence of other forms of political pressure. We felt then and we feel even more today that that objective will perhaps be more difficult to achieve under the new act than under the old.
One reason for that is the change which has been made, a change challenged in the report of the parliamentary committee this year, by which the chief executive officer of the corporation is the chairman of the board. I believe the parliamentary committee has recommended a change in that regard, and in principle we certainly support that change. We also quarrelled last September with the appointment of top officials during pleasure; and though we were not able to convince the minister that a change should be made in

Supply-National Revenue that regard, the other place was more fortunate than we were. Fortunately that change was made so that they are now appointed during good behaviour.


George Clyde Nowlan: And the minister was very co-operative.


Lester Bowles Pearson: The minister was indeed most co-operative in regard to the recommendation made by the other place, but not quite so co-operative in regard to the recommendation which came from this side in this place. The president and vice president of the corporation are now appointed by the governor in council, the cabinet. Previously I think they were appointed only by the government on recommendation from the board of governors. We thought that was a change in the wrong direction.
We were told last September that the new board of directors of the C.B.C. would be a guarantee of protection against government pressure, and that they would be generally responsible for policy and administration. We criticized the present act, Mr. Chairman, for its inadequacy to accomplish the purpose I have just mentioned, and indeed for other reasons, and we feel that our worries in this regard have been justified by the events of last year.
We criticized the act because we thought it weakened the principle of one national system. We criticized it because we thought it would make increasingly for two parallel systems, one public and one private. We felt there would be perhaps more weakness and confusion in the administration under the present act than previously because of the appointment of two boards. We felt at that time that, perhaps because of that administrative set-up, the C.B.C. board might become less and less influential and less effective. We thought the C.B.C. itself had been weakened under the new act, and under the new act would be more exposed rather than less exposed to political interference. We thought that would be all the easier because of the new and cumbersome administrative set-up.
Perhaps I might be permitted, Mr. Chairman, to quote from Hansard of last August what I said on this matter. I should like to quote from page 4052 where I said this, and I think experience has confirmed the validity of my remarks:
A third danger to the C.B.C. as a result of this bill is, as X see it, that the new administrative setup of the corporation will become more cumbersome, and its independence will be somewhat less than that which now exists. It will have its own board, but its activities will be subject also to regulation, at least in principle, by the new board of broadcast governors. It will also have to submit its activities for approval to the responsible

minister each year-also to the Minister of Finance, and I will come back to that in a moment- and to the governor in council and finally to parliament. It will readily be seen that in this procedure there will be opportunties to restrict the C.B.C.'s activties, to discourage leadership and enterprise within the C.B.C., and to tamper with its independence which is so essential to the corporation.
Then I went on:
Under existing legislation the operating personnel of the C.B.C. from the general manager down are insulated, if I may use that word, from direct political pressure and political interference by the presence of a board of governors and a full time chairman of that board. That particular form of insulation has now been removed.
Then there is this:
Perhaps the minister will say that something else has been put in its place, but I suggest that the new insulation is not going to be as effective as the old. The senior executive of the corporation now will be the president, who will also function as chairman of the board of governors of the corporation, which means that the responsible minister will now deal directly with the senior operating officer of the corporation-the president -instead of with an officer removed from day to day operation, the chairman. The new board will no longer be able to act, as it did formerly, as a protective shield for those concerned with the development, production and broadcasting of programs.
It seems to me, Mr. Chairman that these words take on new meaning now in the light of developments. It seems to me that the Canadian Broadcasting Corporation may have some difficulty in achieving the objective under the new set-up mentioned by the Minister of Finance when he spoke in this house on March 29, 1957 of the danger of political interference with the necessary independence of the C.B.C., as recorded at page 2827 of Hansard. This is the present Minister of Finance speaking:
If the Canadian Broadcasting Corporation is to function in a manner free of government interference, then there must not be attempts on the part of the Prime Minister or other members of the government to influence the programming activities of the Canadian Broadcasting Corporation, and above all opinion broadcasts on public issues.
Those were the words of the present Minister of Finance. In my view, Mr. Chairman, the Canadian Broadcasting Corporation, partly because of the new set-up, is now under greater ministerial and political influence than before and there is, consequently, more ministerial contact with it than before. The minister when he appeared before the parliamentary committee had this to say, and I quote from page 603 of the committee evidence:
Mr. Bushnell and I have been very close. We have talked freely and met two or three times a week in discussing the affairs of the corporation-

On the next page, 604, a question was asked by the hon. member for Port Arthur, as follows:
Did you ever take any of these representations on programming from your colleagues to Mr. Bushnell?
The minister replied:
Not in any specific way. I may have mentioned, and I undoubtedly have, many programs, sometimes commending him and sometimes criticizing him. I may have given my own personal opinion, and may have said: My colleagues are sore about this or irritated about that, or did appreciate that, or something of that kind. I have no power with the C.B.C. I am in the unfortunate position of receiving a lot of blame and having no responsibility for anything.
I think perhaps the minister is unduly modest about his own authority and influence in this particular matter.


George Clyde Nowlan: A historical allusion you may remember.


Lester Bowles Pearson: Yes, I remember. What, then, is the position now? Is the C.B.C. independent of political influence and political pressure in the way it should be? Again, I am not talking about parliament, but I am talking about other forms of political pressure. Perhaps I may be permitted to put on the record a paragraph from an article by a well known commentator on parliamentary affairs, Mr. Lynch, which appeared in the Ottawa Citizen of July 11 of this year under the title "The Dilemma of the C.B.C." Mr. Lynch had this to say in this article:
Few members of parliament seem much impressed by talk of the independence of the C.B.C.
The feeling of the government, as nearly as I can discern it, is that if the C.B.C. cannot be used for government purposes, at least it is not going to be used to defeat those purposes. Hence, top-level sensitivity about critical commentaries on radio and television and the efforts that were made to kill "Preview Commentary".
That is the quotation from the article. There always have been, there are now and there always will be people telling the C.B.C. to do this or that about programs, praising or criticizing and perhaps criticizing more often than praising. There always will be members of parliament who have their own views about C.B.C. programs. I do not think anybody wishes to interfere with their freedom in that regard, and perhaps their freedom as members of parliament to talk about it. But when advice, if I may use the word the minister has used and I think the head of the C.B.C. used, comes from the Prime Minister or a cabinet minister, especially perhaps from the minister responsible for C.B.C. affairs, surely that is in a different category of significance and importance.
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Some members of this house will recall the great excitement that was created a few years ago when the prime minister of that day, Mr. St. Laurent, wrote a letter to the chairman of the C.B.C. criticizing one program, not a series but one particular program after that program had taken place. Hon. members will recall the great furore that was caused in the house by that letter and the resulting discussion that extended over two or three days, one result of which was that every member of the cabinet of that day had to stand up and declare himself. The hon. member for Essex East says all except him. He must have been out at the time on agricultural business.
But that particular incident, whatever view we may take about it; did that in fact prejudice the position of the C.B.C.? It might have, even in the circumstances I have mentioned. I admit that. It might have, because of a letter coming from the prime minister of this country; but it did not. That series went on as usual. Perhaps the significance of that episode has been very clearly put by the editor of the Hamilton Spectator in an editorial of June 23, 1959 entitled "Conservatives Putting Pressure on the C.B.C." when he had this to say:
But the healthy and reassuring part of it-
That is of the incident I am talking about, when the prime minister wrote that letter.
-was that, whether Mr. St. Laurent could write or had written as a private citizen, he received just the reply that any private citizen would have received. Mr. Dunton had told him that the C.B.C. was a vehicle for free expression of opinion and that was the end of it.
That last sentence is the crux of the matter. That was the end of it. But when the C.B.C. is now told by a minister that he or his colleagues or one of his colleagues or the Prime Minister or any member of the cabinet is "sore" at a program, is that now the end of it? That surely is a question with which we are faced.
All these anxieties, Mr. Chairman, were brought to a head by the cancellation of one program, "Preview Commentary", and the resignation of some 30 officials who believed that this cancellation was brought about by what three of them called clandestine political influence. This matter was investigated by the parliamentary committee and the verdict was that there was no evidence-it was a short verdict-to support this contention.
I ask any member of the committee to read, as perhaps most hon. members have done, that evidence and come to their own conclusions as to whether there is any evidence to justify that statement. The decision
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Supply-National Revenue to cancel this particular program which brought, as I say, these matters to a head- and they had been simmering in other ways for a good many weeks-was taken by the acting president of the corporation as the parliamentary session was, we hoped, then drawing to an end and as the parliamentary committee set about to discuss broadcasting, especially political broadcasting.
Why was that decision made so suddenly at that time? It certainly appeared to be sudden; certainly it was a sudden decision to the colleagues of the acting president. Mr. Bushnell himself, as reported at page 558 of the evidence, answered that question. He said this:
I must admit that having had a rather busy time-
And he certainly has had in the past year; he has worked, as the minister has said, extremely hard.
[DOT]-this matter was not brought to my attention until some time. I should think, around the first of the year.
He does not say in his evidence who brought it to his attention at that time. Then he went on to say:
And, then again, I felt we had quite responsible people who would be looking after this-
He meant looking after that particular program. As I shall try to point out later, they were looking after it and they had no reason to believe it was causing any trouble at that stage. Then Mr. Bushnell went on to say:
-and I should think it would be about a month ago that I began to ask for the scripts. It is my personal view-and I think it is only fair to add that a review of the scripts that were read by Mr. Jennings and by Mr. MacArthur, who was our former chief news editor, they found that some of the scripts at least, were not what the C.B.C. might ordinarily expect them to be.
From that statement and other evidence of that kind one would gather that the cancellation of this program was just an ordinary matter of program quality. If that were the case the obvious reaction of anyone looking into this matter would have been, "Why not try to make it a better program, get better commentators, try to get better scripts before the next session of parliament, and let this run on for the few days remaining in this session?"


George Clyde Nowlan: It shows there was no political influence.


Lester Bowles Pearson: I will come to that matter later. During the recess the whole matter could have been reviewed by management. Obviously that would have been the normal course.

But another reason was given by management as an explanation for the cancellation of this program, namely that you could not expect this kind of program of analysis and comment on parliamentary activities to be satisfactorily done in a period of five minutes, that it was too much to expect of experienced members of the press gallery to do that s.ort of thing the morning after. It was not fair to them though they are expected to send dispatches and comments to their own newspapers not the morning after but the moment after something happens in the house.
Another reason was given by the management, namely that this program had ceased to be factual, although I always thought it was a program of analysis and comment. In any event, whatever the reason may have been the program was suddenly cancelled on the decision of the acting president of the corporation, who in the midst of his very heavy duties and responsibilities-and they were particularly heavy at that time-became very much concerned with this one program. Those responsible for that program-under, of course, the head-where not consulted about this cancellation. It was sprung on them to their consternation, as they made clear before the committee. Also they made clear that they had received no complaints about it, at least the officer of the corporation directly responsible states that, and that they had no reason to believe it was not satisfactory. Why then this decision?
It seems quite obvious to me that the decision was not merely or perhaps even primarily based on programming considerations. If that were the case, surely those who were responsible for it and who were still being responsible for it and who were producing it would have been consulted before action was taken. We know they were not consulted. So what happened? Let Mr. Jennings, the controller of broadcasting, answer on June 30 as reported at page 552 of the committee proceedings:
On Thursday, June 11,1 was instructed by Mr. Bushnell that the program "Preview Commentary" was to terminate as of Friday, the following week, June 19. I was told at that time I would be given an explanation shortly. Later, the explanation was given to me that both the president and acting president would lose their jobs if the program was not terminated and that the position of the minister would be in jeopardy, and that there could be no change in the decision.
In his evidence Mr. Bushnell attempted to throw some light on this matter. He did not exactly come to the same conclusion, of course-as we know

that Mr. Jennings had come to. But Mr. Bushnell had this to say and I quote from pages 561 and 562 of the proceedings of June 30:


Mr.   Bushnell@: I made the decision because I felt that the program in itself was not as good as it

should be. and I have reason to believe that it was displeasing a great many people; and reports that came back to me through my board and through my association with certain businessmen- if you like-
The "if you like" is Mr. Bushnell's, not mine.
-and certain others, such as school teachers indicated to me clearly that his program was not achieving what I thought it had been created to achieve.
A little later that day the hon. member for Bonavista-Twillingate asked Mr. Bushnell this question:
Was there any suggestion from him-
That is, the minister.
*-or did he convey in any way to you-
That is to Mr. Bushnell.
-the notion or the feeling that this program was displeasing to the government or to anyone in the government?
Mr Bushnell: He conveyed to me the impression that several programs had displeased a great many people in the government and elsewhere.
Then my hon. friend from Lapointe asked this question:
I would like to ask one more question. Mr. Bushnell has just told Mr. Pickersgill that in the discussion between himself and Mr. Nowlan that the latter conveyed to him the impression that many programs were displeasing to a great many people. I wonder if that precise program, "Preview Commentary", had been mentioned during that discussion?


Mr.   Bushnell@: I could not truthfully answer that.
Then the hon. member for Port Arthur said:
Mr. Walker-
Mr. Walker was one of the officers in charge, the immediate superior to Mr. Peers.


George Clyde Nowlan: The director in Toronto.


Lester Bowles Pearson: Yes; Mr. Peers was the producer of the program.
Mr. Walker reported on a telephone conversation that went from the Celebrity Club-
That is a club in Toronto.
-in which you-
That is Mr. Bushnell.
-spoke to Mr. Ouimet.
The president.
Is it true that in that telephone conversation as reported in substance by Mr. Walker that you told Mr. Ouimet that if the program did not go, your job and his job were in jeopardy?


Mr.   Bushnell@: Inasmuch as there were two witnesses there, Mr. Jennings and Mr. Walker, I do not think I could categorically deny that.
Perhaps in fairness to Mr. Bushnell I should read the next sentence:
But what I did say, or what I was trying to get at, was this: That if, generally speaking, something was not done to correct some of the errors of our ways, that could be a possibility.
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In the face of this-and I could quote, of course, other portions of the evidence-the parliamentary committee said in its report that there was no evidence of any political influence in this matter. The committee, of course, did not complete its examination of this matter. There were certain witnesses who in my view should have been called before the committee to make that examination complete, but that was not done. The reason given to us was that there was no time to hear other witnesses, whose evidence I suggest would have been very important to clear up some of these loose ends. In its report the committee talks about limited time, shortage of time, as a reason for not going more completely into this and perhaps certain other matters.
On that point the Toronto Globe and Mail of this morning, July 18, in an editorial entitled "Only Half the Job", has this to say:
If nothing else, the sorry spectacle-
That is a reference by the Globe and Mail to the report of the committee and the hasty manner in which the Globe and Mail says it was produced.
-should be an object lesson for the government to get its committees appointed and functioning right at the start of the session. There is no need for this undue haste; it can be quite damaging, in fact, as the C.B.C. report has shown. This subject in particular is far too important to be treated so hastily.
The minister will remember that last session when we were discussing this bill we urged that before it was passed it should be sent to a committee at that time to be discussed, and the minister said this could not be done because we were then also in the last days of the session, but that a committee would be set up in the very early days of the next session to go into this matter. "The early days of the next session", which I think began on January 15, did not begin for the purpose of this committee until April 29.
Therefore it is quite true, perhaps, that the committee did not have the time which was necessary for this very important purpose. Because of that-and certainly the government must take responsibility-and perhaps for other reasons, the committee, as far as I can gather from reading its hearings and its report, did not make the effort it should have made to examine in a comprehensive way broadcasting policy as a whole or the new act itself, and how that act should operate. There was certainly an examination at that time, I gather quite a heated examination, of particular programs, and many views were aired about many programs and performances. But that fundamental examination of the new Broadcasting Act and broadcasting
6306	HOUSE OF
Supply-National Revenue policy, and the purpose of such policy, which we were told last session would be carried on by this committee, does not in my view appear to have taken place.
At the moment, as I think the minister pointed out in the remarks he made at the beginning of this discussion, the Canadian Broadcasting Corporation is the centre of attack from various quarters. I admit at once that in my view the corporation has given some ammunition to its attackers, some of whom certainly wish to destroy it and to put radio and television stations under private ownership in this country. At the same time, there seems to be developing a sudden emphasis in this country on the virtues of private broadcasting, so I ask myself, is there a concerted effort under way now to weaken and eventually destroy a publicly owned and publicly operated national broadcasting corporation? Is all this concerted criticism and attack preparatory to the strengthening and enlarging of the private sector in that national system at the expense of the C.B.C.? Is it preparatory to the granting of rare and valuable public assets in second television licences in metropolitan centres? And is this to be done before the board of broadcast governors has laid down conditions and standards of performance? Perhaps the minister will reassure us on that.


George Clyde Nowlan: I can say "No" right now.


Lester Bowles Pearson: I am glad to hear that.


George Clyde Nowlan: That is why the decision has been delayed.


Lester Bowles Pearson: I am very glad to hear that. Nevertheless it will be very interesting to see after these regulations are issued who gets these licences. Who are to be the favoured recipients of the potentially most profitable public franchises, perhaps, since the days, shall I say, of the East India Company? When the grants are made and the licences are given, the country will scrutinize most carefully both the people to whom this gold mine has been granted and the terms of public service which will be expected of them.
Let no one have any doubt about the importance of this impending action. Broadcasting, especially television broadcasting, must mean a Canadian system to reach the maximum number of Canadians with Canadian programs of entertainment and enlightenment, and the report of the committee emphasizes that.
There should be an expansion of the activities and services of the C.B.C. into certain areas where those services are not satisfactory or are non-exstent at the present time. That is a very expensive operation, and will perhaps become more expensive as the C.B.C.


moves further afield for that purpose. It is bound to be expensive with our scattered population and great distances. Is that a service to be left to the C.B.C., with the few available remaining television channels in the large metropolitan centres left to become lush opportunities for a few favoured individuals with enormous potential for private profit, and incidentally providing a great potential danger to the publicly owned system and its increasing cost to the public treasury?
I am sure the minister must be aware of this danger. If the C.B.C. is to do the job the report says it should do in the public interest, and if it is to do the job that private enterprise will not take on while being given the lucrative franchises, then there is not only a danger of exorbitant profit from some of these franchises but there is a danger of the C.B.C. being unable to do the job it should do in the public interest except at even greater expense, perhaps, than is the case now.
There are only a few remaining television channels available for licensing and they are, as I have said, rare and valuable public assets. I suggest to the minister that if and when they are granted they should be given to those with a well established sense of public responsibility, on terms that will clearly assure that abnormally large private profits will not be made, and that the maximum amount of public service will be provided from their use. On no other basis, surely, can they be made acceptable. Let anyone who receives this public trust know now that he will be required to account to the Canadian people and the Canadian parliament as the representatives of the Canadian people for his stewardship, that his operations and profits will be fully examined, and that there will be no hesitation in revoking a licence improperly granted or badly used.
I do not quarrel for one moment with the idea of the closest possible scrutiny of the affairs of the C.B.C. I am sure that must be done with respect to the C.B.C. If it is not done there will be extravagance, undoubtedly. Once the C.B.C. is given some kind of basic financial security perhaps that will necessitate an even stricter examination into its financial and administrative arrangements. But let the same kind of public examination be devoted to the private sector of the C.B.C. which otherwise might be able to exploit its franchises in a way which would not be consistent with the public interest.
Certainly the views of our party on this matter are well known, but I should like to put them briefly on the record once more.

(1)	We regard the C.B.C. as an essential and vital element in our attempt to create a united Canadian nation with a distinct national identity and culture.
(2)	We recognize and accept the existence of private radio and television stations, but only as integral parts of a single national broadcasting system, subject to controls and standards of performance designed to provide maximum service to the Canadian people. These private stations must not become a happy hunting ground for a favoured few who have received rare public assets in order to create large private profits.
(3)	We have every desire and intention that the C.B.C. should be required to operate efficiently and without waste of public moneys, and within a budget that will be fixed for longer than a year. But, subject to this, we believe that we should be prepared to pay nationally for the national service we wish to have and the national values we are seeking to maintain and strengthen.
(4)	We believe that the C.B.C. should be an independent agency, subject only to broad policy controls by parliament, free from political intervention by anyone and free also from stultifying and picayune interference with the details of its day to day programming operations. We believe its management must be free enough and strong enough to reject political interference with its programming, especially with its talks and public opinion programs, for whatever quarter it might come.
(5)	We believe that such an independent agency, sufficiently but not extravagantly financed and efficiently but not extravagantly operated, can be a major contributor to the development of a distinctive Canadian culture and to our growing sense of national identity.
I know the minister will agree wholeheartedly with me in that stated purpose of the national broadcasting system. We believe that such a system can help tie together the many scattered elements of Canada into a national unity. It can interpret the skills and aspirations and even the dreams of one part of Canada to other, distant parts. I think the C.B.C. is making a magnificient contribution to that end at the present time.
We also believe that this kind of national system can encourage musicians and artists and thinkers and entertainers and athletes to develop their varied talents and remain here in Canada for our entertainment and enlightenment. It can do much to build a Canadian culture-using that much misunderstood word in its widest and most imaginative sense-and to resist undesirable United States cultural influences which flow
Supply-National Revenue across our air waves, pervade our movie houses, and are to be found in books and magazines.
I do not want to be misunderstood in this. In this United States cultural impact there is much which may be and indeed is of very great value and adds richness to our Canadian life and from which we can and do benefit. But we must also have in Canada thoughts and ideas and music and entertainment of our own. Without this-and we cannot have it without a public broadcasting agency maintained at considerable public cost-we cannot have a Canadian nation at all.
Because it has a direct bearing on this point and is very well put, perhaps I should conclude by reading a few lines from an editorial in Maclean's magazine of July 18. After mentioning the differences, difficulties, controversies and anxieties created in recent months about broadcasting, the editorial states:
All this points to one of two conclusions:
On the one hand the C.B.C. management may be giving way to pressures that stronger men would ignore-which would be a grave fault in C.B.C. management.
On the other hand political pressures and even pressures from its own employees may be vastly greater than they used to be. too great for men of ordinary strength to resist-which would be a grave reproach to the politicians now in office.
It is extremely important for Canadians to know which, if either, of these conclusions is correct. For no matter who runs the national broadcasting system, Canada still needs one as much as ever- a system that will be not only genuinely Canadian but also genuinely free.
I state that if it is not genuinely free it will not be genuinely Canadian.


Douglas Mason Fisher: Mr. Chairman, the idea of a nation is a fragile one. It seems to me it has its origin not in forms, legal or otherwise, but in the consciousness of the people. Forms are the clothing of the nation, but the essence of nationality is psychological. It consists in a miraculous psychological transference from the circumscribed conception of family and locality, of deep affection for kitchen and home-the village pump, if you will-to the individual's identification of himself with the whole community.
This immense psychological link would be impossible if the conception of our national entity remained an abstract one. I know it is nurtured by symbols, but also by the continuing assurance of our separateness, our uniqueness. This is the vital and binding function of the Canadian Broadcasting Corporation, to translate the abstract conception of nationhood into something that can be seen, heard, felt and understood. No organization has done more to achieve this high purpose.

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An idea like distinctive nationality is not worth 5 cents on the dollar in the market place. You place the C.B.C. at the mercy of hucksters, of deodorant and detergent peddlers, and you wave goodbye to it as a buttress to national identity. If Sir John A. had been prepared to sacrifice the principle of national integrity to the claims of private enterprise there never would have been a C.P.R., nor would there have been that complex of Canadian private business which has managed to shelter itself within the national economic framework that Macdonald built. The vision of the entrepreneur, and of the petty and interested men who are prepared to help him, is limited to the area enclosed by the four corners of the dollar.
It is galling to me, and especially to someone interested in history, that the inheritors of the great Tory tradition of Macdonald have failed so dismally to learn the lesson he taught; that nationality for Canadians is something that must be paid for.
The committee's evidence dealing with the C.B.C. this year, Mr. Chairman, is over 700 pages in length. There were over 30 sittings. There was an agenda with dozens and dozens of points. How much time did the committee have to prepare the report? Over the week end. The draft report was prepared on Monday. A whole melange of ideas was chopped and meshed together, given a certain amount of coherence, a certain amount of balance, and then was put to the full committee in camera the next day. The committee spent somewhere between 21 hours and 31 hours sifting that particular melange of ideas into a rather stupid report which was presented to this house.
There were three great diversions at the sittings of this committee. I would like to just touch on them in the order of their appearance. The first diversion to me was the rather vicious destructiveness of those "men of the people" and of Maurice Duplessis who came into the committee and at almost every sitting identified themselves with the people and proceeded to present a form of questioning which indicated that they would like to have some kind of program control, or some kind of control over the appointments, almost a censorship, on one side of our national television and radio.
The second diversion of the committee meetings was the two sessions with the board of broadcast governors and with its head, Dr. Stewart. I say "diversion" because they took us to quite an extent out of the C.B.C. line, and I want to comment later on what we did find out, though it was not complete, about the board of broadcast governors.

The third diversion of the committee was the storm over the charge of clandestine political influence.
In so far as the first diversion is concerned, "les petits Canadiens", the chairman and the committee as a whole I think were rather leery, but they did make a final concession to them, one which certainly disgusted me, and that was the rather measly decision to delete any affirmation of the principles of the C.B.C. that might tie in historically with the fact that we had a Fowler commission and a Massey commission and other reports which were intimately connected with the committees of this house which were denied because, Mr. Chairman, "les petits Canadiens" did not care for them.
In so far as the board of broadcast governors is concerned, the evidence is not complete but there certainly was to me the suggestion that the board of broadcast governors is taking a fairly narrow, cautious way in working up and working out its functions and positions. There seems to be no real rapport yet with either the C.B.C. or with the private stations. So far the board of broadcast governors seems to be a body somewhat detached from the reality of a national, vital means of communication, and certainly so far there seems to be some confusion as to its functions.
So far as the charge of political interference is concerned, your committee investigated the charge that clandestine political influence was responsible for the cancellation of the program "Preview Commentary" and found no evidence to support the charge. Why? Why did they find no evidence? Because Mr. Bushnell denied the purport of what a number of people close to him said he said. Why? Because the Minister of National Revenue felt that he had no accurate recollection of any remarks he may have made about this program, "Preview Commentary".
In the unseemly rush past Mr. Bushnell's most peculiar and paradoxical evidence, we still have no explanation of the odd Celebrity Club phone call; the odd decision of the board of directors to support the management decision to use the axe, then the reversal of that decision. We also have the refusal of the committee majority to go further into these odd aspects.
What did the minister tell us? What stands out is that he dislikes this part of his job. Some commentary that is of the legislative aborting of last session that we produced on broadcasting. He wants out of the responsibility. This is what he said:
I told him-

That is Mr. Bushnell.
-I was going to try to get the Prime Minister to appoint someone else because 1 was sick and tired of these criticisms coming in from all over the country, from members of parliament, from my colleagues and from the public generally.


George Clyde Nowlan: And from the C.C.F.


Douglas Mason Fisher: I continue:
I said that life was too short to be bothered with this thing and that I was going to get out of it.
Later, at page 604, we find the following:


George Clyde Nowlan: I may have mentioned, and I undoubtedly have, many programs, sometimes commending him and sometimes criticizing him. I may have given my own personal opinion, and may have said: my colleagues are sore about this or irritated about that, or did appreciate that, or something of that kind. I have no power with the C.B.C. I am in the unfortunate position of receiving a lot of blame and having no responsibility for anything.
So those broad shoulders over there are just not broad enough, Mr. Chairman. What a commentary on the legislation; what an indication that we need the relationship of the C.B.C. to the government put in the way recommended by the Fowler commission; that is, from the C.B.C. to the B.B.G. and then the relationship to the government. Did the committee consider this evidence important, this evidence of the minister? Not at all. Let us tinker with the idea of a chairman distinct from the president. Perhaps that is a good suggestion but it is an evasion of the underlined fact that one of the grievous faults with the C.B.C. is its relationship with a minister who cannot take the C.B.C. in its relationship to him.
So far as political interference is concerned, the minister did give program criticism to Mr. Bushnell; he did mention that it came from his colleagues. Mr. Bushnell either did take this or some more mysterious information seriously enough that he jettisoned a fairly innocuous program without bothering to give those below him anything more than the compelling explanation "heads will roll". So this relatively innocuous program lasting three minutes and 11 seconds five days a week was axed, this nice little pin-money show for the boys in the gallery. We still do not know any more about the reasons for its going than that it was a mysterious aberration of Mr. Bushnell. We are afraid the committee's words that there was no evidence to support the charge has real substance. We are sure that the government members on the committee were none too anxious to search hard, Mr. Chairman. There may not now be anything rotten in Denmark, but there was something rotten in Denmark.
In so far as the C.B.C. budget is concerned, there are a number of ways in
Supply-National Revenue which the finances of the C.B.C. could be set up. One of the means we are using at the present time is a parliamentary appropriation. There is the possibility of a special tax-we have had that in the past-to support the C.B.C. There was the old possibility, used in the past, of licence fees supporting the C.B.C. We could have a parliamentary appropriation tied to a formula. It could be tied to the number of sets at so much a set; it could be a fixed percentage of the gross national product that would allow for changes and adjustments in the economy. It could be a fixed ratio to the population or to the population growth.
On this question of a formula or means of getting money for the C.B.C. we have an area where members of parliament do not need evidence so much as their own common sense and instinct as to what their electors and constituents would appreciate, what they themselves would think it is worth. Did we get anything constructive from this committee on that? No; we merely got the recommendation of some formula by which limits may be set on the annual contribution of the federal government to the corporation, plus this very peculiar addenda that increasing effort should be made to ensure the emergence of vigorous commercial policies.
What encouragement to a public corporation. Did socialists recommend this? No, sir; these were private enterprisers recommending that there should be increased effort to ensure the emergence of vigorous commercial policies on the part of a public corporation. This committee would not suggest a formula or possible formulae in an area where the situation was and is most grave, that having to do with the financial needs of the corporation.
But on sponsorship, that obsession of the hon. member for Calgary South, we got quite substantial recommendations. It is said to the C.B.C., "Be vigorous. Ease the taxpayer and belt that other face of the taxpayer, the consumer face, through more bites of the advertising dollar. Rob Paul to pay Paul". It is not the C.B.C.'s function to turn a profit. Where this can be done without impairing the C.B.C.'s prime function as a national service and without diminishing the standard of programming there can be no objection, but it is not the end goal of the C.B.C. to turn a profit. This is precisely the weakness in the proposition that the C.B.C. should cede production rights in sponsored shows. United States experience has shown that this leads to sponsor control of program content.
On that point I should like to recommend to all members, and especially the Conservative members, a speech by Edward R_

Supply-National Revenue Murrow delivered to the radio and television news directors' association last year. It is found in the November 13, 1958 issue of The Reporter. I am sure all hon. members realize that Mr. Murrow has been a prominent figure in United States television. He had this to say:
I am entirely persuaded that the American public is more reasonable, restrained, and more mature than most of our industry's program planners believe. Their fear of controversy is not warranted by the evidence. I have reason to know, as do many of you, that when the evidence on a controversial subject is fairly and calmly presented, the public recognizes it for what it is-an effort to illuminate rather than to agitate.
He goes on to say:
The oldest excuse of the networks for their timidity is their youth. Their spokesmen say: "We are young; we have not developed the traditions nor acquired the experience of the older media." If they but knew it, they are building those traditions, creating those precedents every day. Each time they yield to a voice from Washington or any political pressure, each time they eliminate something that might offend some section of the community, they are creating their own body of precedent and tradition. They are, in fact, not content to be "half safe."
Later on Mr. Murrow makes this statement:
It may be that the present system, with no modifications and no experiments, can survive. Perhaps the money-making machine has some kind of built-in perpetual motion, but I do not think so. . . . Our mass media reflect this. But unless we get up off our fat surpluses and recognize that television in the main is being used to distract, delude, amuse, and insulate us, then television and those who finance it, those who look at it and those who work at it, may see a totally different picture too late.
This is a commentary by a very intelligent man, Mr. Chairman, on the very thing that some members of the house and of the special committee seem to want to drive us toward. The United States system is not working out so well in this field that we can take the private entrepreneurs or private systems there as any great models for programming or sponsorship. It should be the business of the government to ensure that the C.B.C. needs as little sponsorship as possible. Can the C.B.C. be blamed when private corporations quite naturally take advantage of the weak financial position of the corporation? Is it likely that private corporations will be shamed into paying higher amounts merely as a result of the publication of program accounts? I think the answers to these questions are no.
The only way to rescue the C.B.C. is not through facile lip service to practicable formulae, which is sheer escapism, but by improving the bargaining position of the C.B.C. in a ruthless and predatory market by establishing it on the sound financial basis

that any great public service requires. I should like to ask those hon. members who are so antagonistic to the C.B.C. this question. Does the government subsidize the Department of External Affairs? In essence they are carrying out the same function.
The most disturbing element in what is going on in the country with respect to C.B.C. criticism is that there is a temptation for any one of us to climb on this band wagon. I say there is a temptation for any of us. There is a temptation to many of the people in my constituency who do not think of this greater entity and the need to preserve its uniqueness. In their desire to have wrestling three or four nights a week or to have canned westerns they are willing to go along. But I suggest that we have always to look at this national need for the C.B.C., and we have to consider the nature of the criticism of the C.B.C. that appears in public media.
I happen to follow the fortunes of the Thomson newspapers very closely. There are over 24 outlets in Canada that week after week pour out a daily dose of poison against the C.B.C. Mr. Thomson, whose progress in Britain I am sure will some day be rewarded by his becoming Lord Thomson of South Porcupine, started in the private broadcasting business and made a great success. There is nothing against that at all, but he has gone on to build an empire of newspapers, radio and television interests that surely makes him or his newspapers less than fair commentators on the position of the C.B.C.
One can say the same thing about the Sifton interests. Those of us who follow what the Siftons and Mr. Bell are doing could become very worried about the situation in Regina or the situation in Winnipeg, where we may be moving toward a private monopoly in newspapers, radio and television. I should like to remind hon. members and the people of the country, if they do happen to listen, that much of the criticism of the C.B.C. in the newspaper medium is of the orientation of the Thomson and Sifton interests, which are about as interested in Canadian nationalism as-well, I don't know what to say to convey their self-interest. Certainly they are much more interested in their connections with their newspapers and their television and radio stations.
On the question of the board of broadcast governors, the legislation produced last year has been most disappointing. To me the evidence given by Dr. Stewart before the committee was most disappointing. He had to be prodded into saying that the board of broadcast governors was anything more than a passive instrument that just waited. From the minister's statement last year we had

hopes that the board of broadcast governors would really enunciate a national policy, that it would be the body that would determine the carrying out of this marriage between the C.B.C. and the private stations in one national system, that it would determine how this was going to come about. But we have not much promise in the indications that we get.
Admittedly it was incomplete, but I suggest that in the interval from when this session ends until the next one opens the minister, if he has any influence or any interest left, should try to encourage the board of broadcast governors to give the leadership that it seems hesitant about giving now so far as a national policy is concerned.
Are we going to go on, Mr. Chairman?


Lionel Chevrier: Yes.


John Whitney Pickersgill: Go ahead.


Douglas Mason Fisher: I assume we are going through the lunch hour. The final point in a general way that I should like to make relates to the Prime Minister and the members of the government, I mean members of the government as a whole. I have to be fair to a number of Conservative members with whom I worked on the committee and say I think they have caught that kind of vision the Prime Minister has presented to this country, a vision of Canadianism. However, I am very much afraid that many members in that government group have not caught its meaning.
We have a Prime Minister who makes a point of Canadianism, who makes a point about the commonwealth and its importance. In essence, in two elections he fought campaigns that were based, at least partly, on the statement that we will take a firm stand with the United States. It is no good, in so far as the C.B.C. is concerned, taking a firm stand with the United States in an official way because the need is still there, more than ever before, to see how the C.B.C. fits in with the private stations to stem that influence from the south. The need is perhaps greater than it has been in the past; the need is not less.
The Leader of the Opposition made the point that the Liberal party still stood for the C.B.C. fitting into a system with the private stations, essentially as a national policy. He made the point that the C.B.C. must be efficient, even though it cannot pay its way. He made the point that the board of broadcast governors and the C.B.C. should work within a particular national policy. Well, on every one of those points I think we agree. I do not know how many members of the government agree with this. The Leader
Supply-National Revenue of the Opposition made a point about these lucrative plums that are going to be handed out, and how we are all going to be watching whether some of the so-called pals of the government get these plums.
He also made a point in connection with the C.B.C.'s position which he said may be in jeopardy because of the impact of this competition. Well, I believe that is the kind of chore the board of broadcast governors should be carrying out now, examining this sort of problem and planning to give leadership. I can see that in the rich television markets alone which we have concentrated in about four places in Canada we are not going to get the national service that any contribution from those market areas in terms of advertising revenues would warrant.
One of the ironies we always forget in talking about the competitive nature of private stations, that they will get in there and fight, is that there was never a case of which I know in the history of all the applications made to the C.B.C. in the past when it was the regulatory agency where, if there was one private station in an area and some other group wanted to put in another private station, there was a welcome mat put out. This is how free and enterprising these private enterprises are. They never put the welcome mat out. They fought over the application that was made. These are the ones who have been talking about the C.B.C. monopoly and its dangers, but when it comes down to the point of really believing in the principle they merely yap about it. Now they want protection for their monopoly, right down the line.
Some hon. members will say that is the nature of the market. Sure it is, but then don't yap. We have had this history of yapping against the C.B.C. on this point, and this will be a key point in the future. We have a private television station in Port Arthur, and there are a number of them across the country linked with the C.B.C. network, doing a fair to middling job, sometimes a good job. I want to say that if we are going to turn the C.B.C. open to competition, I hope the C.B.C. will take a good, long look at the prospect of firing a few more of their projected television stations into these little empires. Then will we ever hear the yapping.
The whole situation with respect to the C.B.C. may well be determined in the next six or eight months by the kind of mood and attitude that develops daily and is given enunciation by this government. I have so much respect for the minister, both in personal terms and the kind of character he has, that I am still hoping, despite his desire
6312	HOUSE OF
Supply-National Revenue as given in evidence to get out of this chore, to get away from it and give it to somebody else, that he will stay and try to get the C.B.C. back on the road it should be following.
Those who may think they are little Canadians, who think you are going to solve everything by turning it over to the private broadcasters, should look at the evidence given before the royal commissions, should look at the evidence given before house committees, and they will see what kind of service the private broadcasters will give us. There is no doubt, and I think any fair-minded Canadian would admit it, of the need for the C.B.C. If it has had a time of trouble, some of the responsibility rests upon the legislation which was introduced last year by this government.
We would welcome nothing more than a statement, not from the minister but from the Prime Minister himself, on what he believes and thinks about the C.B.C. and its position in the future. I think that would do more to handle what concerns me most within the framework of this house, that is the niggling, nasty desire amongst some Conservative members to junk the C.B.C. I believe there is a great need for the Prime Minister to lay it on the line so that all the members of his party will realize that junking the C.B.C. is not Conservative policy.
(Translation) :


Mr. Tremblay:: Mr. Chairman, while we were discussing the business of the C.B.C.,
I wanted, to express some of my views in order to rectify a few wrong impressions and throw some light upon the principles which, to my mind, should guide that corporation.
I am sorry that the impending conclusion of this session will stop us from dealing at length with the extremely important question of the C.B.C.
I would, as I said before, rectify some wrong impressions resulting from speeches we have heard. As far as I am concerned, I maintain that I never had, and that I have not today any intention of destroying the C.B.C. or of minimizing in any way the prestige acquired by that corporation. I had the opportunity, on some other occasion in this house, to praise the C.B.C. and to mention its excellent achievements. I thought, Mr. Chairman, that this would not deprive me of the right to criticize and to suggest possible improvements in some of the less creditable work of the C.B.C.


During the investigation by the parliamentary committee on radio and television, which I attended as frequently as possible, I tried in every way to obtain information which would help me evaluate properly the former achievements of the C.B.C. and its policy with regard to the future. I had an opportunity during that investigation to express my lack of satisfaction and, in some ways, my discontent, with regard to answers that had been given to me by those responsible for the C.B.C. If I expressed that discontent and that lack of satisfaction, Mr. Chairman, I did not do so in order to minimize the significance of the corporation and to weaken its prestige, but because I thought that my sense of responsibility and the sense of responsibility of the representatives of the people imposed the duty upon us-and a very serious duty at that-of enquiring about everything which goes on in the C.B.C. We should do so, first of all in order to dispel certain misunderstandings, and also to answer the numerous representations received from the taxpayers in the past, and which are still coming in today.
Before the session comes to an end, I did not want to leave hon. members of this house or members of the press gallery under the wrong impression, which the hon. member for Port Arthur (Mr. Fisher) tried to create, as did, up to a certain point, the Leader of the Opposition (Mr. Pearson).
I had prepared some notes of a very moderate character. I tried to apply to my remarks in this house a proper sense of measure. But I feel that, in view of the attacks directed against us, we could not very well limit ourselves to general remarks, but should rather refute, to a certain extent, the false statements made a few moments ago.
Mr. Chairman, at no time during the investigation did the committee, or representatives of the province of Quebec, try to advance a political cause. They simply tried to reply to the public's request that full light be thrown on the C.B.C. operations, not because the people, as a whole, thought there were scandals in the C.B.C., but because they thought that the situation in that state organization was sufficiently serious to warrant an investigation.
It is in that spirit that we undertook to work in the parliamentary committee on radio and television. We never tried, in any way- and I challenge anyone to say the contrary-

we never tried, as I say, to advance political views. We strictly adhered to facts, and public facts. And in that connection, I believe it is proper to recall here an incident which occurred during the investigation.
The committee had decided, from the start, not to make any personalities. For my part,
I was never opposed to such a procedure in the committee; I do think, however, that such a procedure could not prevent us from referring to responsible persons and mentioning public facts involving the C.B.C. administration in any one of its sectors.
Well, Mr. Chairman, I believe that the attitude of Quebec members, during the investigation of the parliamentary committee on radio and television, was one of responsible representatives of the people who, considering the amounts of money engulfed into the C.B.C., are strictly and conscientiously entitled to wonder what the C.B.C. is doing with that money, and I repeat, not with a view to uncovering scandals nor to insinuate that there were misappropriations, but simply in view of establishing that the money entrusted to the people responsible for the C.B.C. is well administered and yields the returns which can be normally expected.
Mr. Chairman, I must say, as I have repeated time and again during the proceedings of the parliamentary committee on radio and television, that I was not satisfied with the replies we were given, because I found them evasive, and I found also that the points we raised were not answered properly.
Mr. Chairman, before going into my remarks to the house, I wanted to make that point, so that there will be no mistake about the attitude of Quebec members who sat on the committee on broadcasting.
I also expressed the view that we should divide the parliamentary committee on broadcasting into two sections, so as to give separate consideration to the problems of both networks, the French and the English, which really have different problems and should be dealt with differently. Such a division was rejected for reasons of procedure, but I think it is too bad, because in view of the tremendous task facing us, we were unable to do a thorough enough job of getting at the information we needed.
Mr. Chairman, I was saying a moment ago that we tried to live up to our true responsibilities. I base this statement on the principles
Supply-National Revenue of responsible government. Every year, we are asked to vote money to the C.B.C. This money is provided not by the members of the house, not by members of the C.B.C., but by the people generally. It is supplied by the hon. members, by officials of the C.B.C. and by each and every taxpayer. So we have a legitimate right, Mr. Chairman, to inquire whether this money is being properly used.
We tried to find out how the C.B.C. is managed financially. Other hon. members who are better qualified than I am to deal with the technical aspect of such problems, will discuss that point. The report submitted by the parliamentary committee on broadcasting contains a number of recommendations on this score.
I shall not go into that, however, because it would take too much time, and besides, it is beyond the scope of my humble qualifications. However, Mr. Chairman, I would point out, as I pointed out during the proceedings, that the C.B.C. should not be regarded as just another crown corporation.
The C.B.C. has nothing in common with an administration such as the C.N.R., because the C.B.C. does not deal merely in material things, but must take into account a moral and intellectual content. People with different outlooks take a different stand on this matter. If you restrict the committee's responsibility merely to the financial aspect of the C.B.C., where problems are translated into figures and accounting formulas, the parliamentary committee's discussion should have been restricted to administrative problems, inasmuch as they have budgetary implications.
But if, on the contrary, it is realized that the C.B.C. is not a crown corporation like others, and that it does not deal only with material matters, but that it involves, as I said earlier, a vast and important moral and intellectual content, it cannot be dealt with like a strictly financial organization. Thus, the parliamentary committee which deals with the C.B.C. is entitled-and this without interfering in internal affairs of the corporation- to try to establish a relationship between the cost of the C.B.C. to the taxpayers and what the corporation offers them.
It is in that light that I have tried to contain my remarks, and it is for that reason that, during the inquiry, I have tried to get information on the general policy of the C.B.C., especially in the matter of programming.
6314	HOUSE OF
Supply-National Revenue
Today, Mr. Chairman, right or wrong the C.B.C.'s business is not only informatory but cultural and even goes as far as being educational.
I therefore have the right, as a representative of the people, to ask who are those responsible for educational activities at the C.B.C. today. When, right or wrong, it seeks as I say, to educate the people, I am entitled to wonder what their principles are, their moral standards, and their line of thought in general. I have a right to ask whether those people may, by all sorts of means, reasonably appeal to the judgment of the people with regard to politics, by setting up at the taxpayer's expense political hustings persistently aiming at the destruction of governments. I have a right to know- and I am speaking for myself as a taxpayer -whether those people would necessarily be accepted in our educational institutions. I have a right to ask whether they are qualified to look after popular education, and even education period.
That is the spirit in which I asked my questions at the meetings of the committee on broadcasting. But I wanted to know exactly what future part the C.B.C. would play in the field of public education.
I tried to obtain some information in order clearly to establish what were the intellectual and moral standards of those responsible for the educational aspect of the C.B.C. I was told that the corporation tried to present programs that were morally sound. Isn't that just wonderful, Mr. Chairman? Can it do other than strive to present morally sound programs?
I am saying that, Mr. Chairman, without in any way trying to minimize the significance of the beautiful and valuable programs put on by the C.B.C. What I am saying is that there is, at the C.B.C., an atmosphere-I am more particularly speaking now of the French network-an atmosphere of amorality. During the survey, something was said about immoral shows. For my part, I believe that the C.B.C. has enough decency not to present any shows that are immoral. But I think that there is at the C.B.C., please note that I am indicting nobody whatsoever, but I wonder whether people responsible for those programs are acting deliberately-a certain lack of moral sense, precisely because there is no moral reference which might be a guide with regard to some of the programs.


I also maintain, Mr. Chairman, that all those who want to call Quebec educational institutions into account are not enough concerned about the national character of C.B.C. programs. There, we have a national institution which has first of all to convey national culture, besides supervising with the greatest care everything coming from outside this country.
The aim would not be to prohibit an access to universal culture to our people, Mr. Chairman, but it must be considered that the public at whom the C.B.C. programs are aimed is not always a discerning one, and is often unable to distinguish what really pertains to Canadian tradition, and what belongs to other cultural expressions.
Mr. Chairman, those issues of a moral and educational character are of capital importance, and hon. members of this house, and particularly members of the parliamentary committee on broadcasting, have no right to feel unconcerned in that respect.
During the convention on radio and television broadcasting, which took place a few day ago in Montreal, His Eminence Cardinal Leger stated the following:
The convention, he said, does not propose to condemn anything. Rather, it tends to express the views of the people. Radio and television are exerting some influence in every home and the church is therefore interested in those means of expression which, today, have become almost indispensable. Everyone has certainly the right to say what he thinks with regard to those programs.
Mr. Chairman, it is not exerting any political pressure to express one's opinions on C.B.C. programs	And I do not think
there has ever been a better court in this respect than the committee on broadcasting for finding out about the spirit of a corporation, the responsible executives of which are often not close enough to the people for whom the programs are meant. It would be difficult to know the views of the man in the street, if those who represent the corporation are not in close enough contact with him. Yet, they should take their inspiration from the people for programs pertaining to Canadian culture with French and Christian cultural backgrounds.
There has been talk of political interference, there have ben persistent suggestions of political interference, in an attempt to give the impression that only Conservative members from the province of Quebec were trying to interfere politically.

Mr. Chairman, there are citizens who complain about C.B.C. news commentaries because they feel those commentaries are controlled and that news commentary programs are monopolized by people representing a particular form and school of thought.
I have no objection, Mr. Chairman, to each citizen expressing his views. I have no objection to organized groups being given a chance to express themselves. What I do oppose is that to news commentaries be always entrusted to the same representatives, the same groups of thought.
To any who would charge political interference in C.B.C. news services, I can read a document proving that political interference does not necessarily come from the quarters they think. I have here a C.B.C. document bearing the signature of Mr. Marcel Ouimet. It is addressed to the news editors in Toronto, to the regional director and to several other directors of the French network. The document, dated July 6, 1959 comes from Ottawa, and reads as follows:
What strikes me Is that, as a result of certain circumstances, we seem to be giving special emphasis to statements by ministers of the provincial government. For instance, I do not believe we were justified, last May 24, to give ten minutes of "Camera 59" to extracts from the speech of premier Duplessis at the convention of electricians in Three Rivers.
Those who were attacked by the provincial leader that day did not have, so far as I know, an equal opportunity to defend themselves.
The same could be said of the speech made by Mr. Sauve a few weeks ago in Montreal.
Mr. Chairman, I have no objection to efforts being made to reach what they call, in the C.B.C., a balance of opinions, but I do not believe that a C.B.C. news official should not have the right to object to opinions being expressed during the news by a man who, after all, is the premier of the provincial state.
I should like to refer also, Mr. Chairman, to a document which will be appended in the latest record of the committee on broadcasting, a letter from a parliamentary correspondent of he Droit, Mr. Chaloult, stating that he had to refuse C.B.C. programs, that he had to refuse to make comments over the air because he had been asked to make comments favourable to the party then in power. If that is not political interference, Mr. Chairman, we might as well do away with the word, and the concept which
Supply-National Revenue remains in the minds of people who have charged the government with being guilty of interference.
Mr. Chairman, I come back to the claim made a moment ago that the actions of Conservative members have jeopardized the C.B.C. I do not believe that public opinion, which expresses itself mainly through its legitimate representatives, could jeopardize a body such as the C.B.C. As I said just now, and I have full confidence in the C.B.C. I do believe that the C.B.C. is able to give us excellent services. But I feel that the danger which now threatens the C.B.C. does not lie in attacks by members of the house or by various citizens, but in the lack of ability which, in my opinion, prevails in several administrative departments of the C.B.C. And please mark my words: I am not condemning the C.B.C. as a whole, because there are, on C.B.C. staff, excellent people, people of genuine ability in their field, but I also believe that, in some particularly strategic departments, some people are incompetent. I do not hesitate to use the word incompetent. It is that incompetence which threatents the C.B.C.
At the conclusion of its proceedings, the parliamentary committee submitted a report. That report, Mr. Chairman, includes excellent recommendations. For my part, I believe that all those recommendations are valid, but I also believe that the report, inasmuch as it recommends structural and organizational reforms within the C.B.C., is perhaps premature. I believe that the investigation we just made, and that the crisis the C.B.C. has gone through these last few months, require that we give increased attention to C.B.C. administration. I believe that it calls, on the part of the people's representatives and on the part of all those who are directly concerned with the C.B.C., for much reflection, and for study of all we have learned in the committee on broadcasting; yes a detailed study of the C.B.C.'s general policy as expressed in the documents submitted to us by the C.B.C. itself during the investigation and which could certainly allow us to introduce recommendations covering the whole activity of the C.B.C., its purposes, objectives, and responsibilities to the public.
For my part, I believe it is imperative to revise very carefully, the C.B.C. plans and objectives, in order to determine exactly what the C.B.C.'s responsibility should be in matters of education. I don't say that it must have that responsibility, but it could have it.

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Before proceeding to an overall shake-up of the C.B.C., to drastic structural reforms, I believe we should study all those documents we now have on hand, and that we should also study the recommendations which were made by those citizens gathered in convention in Montreal a few days ago. There is talk of a controlling body, a body which, let's call it by its name, would be a censorship body, and which would be responsible for the supervision of the moral and intellectual aspects of C.B.C. programs.
I repeat, for my part, the suggestion I made last year about the competence of those who are responsible for news and cultural programs in the C.B.C. I suggested then that consideration should be given to organizing competitions, as well as to organizing professional schools which would allow all those interested in radio and T.V. business to acquire a reasonable degree of competence, based on adequate culture.
Finally, before I close my remarks, Mr. Chairman, allow me to emphasize once more that the C.B.C. should give young writers all possible help, and remove all dangers of monopoly, in avoiding the maintenance, for years on end, of the same programs, which is obviously a handicap to young writers and a danger also to writers who, for years, have been favoured by the C.B.C.
I also insist that the C.B.C. give Canadian artists all possible opportunities.


Lionel Chevrier: Mr. Chairman, I have been listening closely and with interest to the speech just made by the hon. member for Roberval (Mr. Tremblay). He started off by saying he would correct some false impressions that may have been left by the Leader of the Opposition (Mr. Pearson) and the hon. member for Port Arthur (Mr. Fisher) who spoke before him.
He said, among other things, that the allegations of these two members were untrue. However, I was here during the speeches of those two hon. members and in my view, they said nothing untrue.
Moreover, if they had said anything untrue, the -hon. member for Roberval had a right, under standing orders, to rise and raise an objection, and to call for a withdrawal of the statements made by the hon. members.


Léonard-David Sweezey Tremblay: I did not have to rise.


Lionel Chevrier: Mr. Chairman, I am saying that the hon. member was fully entitled,
[Mr. Tremblay.)
under standing orders, to rise on a point of privilege when he felt he was being personally referred to. However, in his remarks, the hon. member has altogether failed to prove that an hon. member had in any way made untrue allegations about him.
Yet, the hon. member for Port Arthur (Mr. Fisher) indicated, with his slight English accent, that some members who took part in the proceedings of the broadcasting committee were petty Canadians.


Mr. Johnson:: Slight accent! He didn't know what he was talking about.


Lionel Chevrier: Mr. Chairman, if the allegations of the hon. member for Port Arthur apply to the hon. member for Roberval, let him accept them. In my view, the speech we have just heard bears the imprint of a petty Canadian. It seems to me that this is not the type of speech that should be made in this house by a broad-minded educator.
Mr. Chairman, I do not want to devote more time to the statements of the hon. member for Roberval, because I have other remarks to make with regard to the matter before the house. However, I shall come back to that later.
Mr. Chairman, I do not propose to repeat what was said by the Leader of the Opposition (Mr. Pearson) concerning the general attitude of the Liberal party with regard to broadcasting in Canada. That policy was established not only by the Leader of the Opposition in this house, but it was set out many times by our party when we sat on the other side of the house. There has been no change in that policy, because we have always favoured protecting this government agency.
However, I wish to recall briefly some statements that were repeated many times by all major groups in the province of Quebec, and particularly at sittings of the Massey and Fowler commissions. Such groups have repeatedly asserted that the C.B.C. was and should remain an essential instrument for the progress and expansion of French Canadian culture, not only within the province of Quebec, but in all parts of Canada where there are important French-speaking groups.
This essential contribution has worked at two separate levels. First, it has enabled our artists and writers to devote themselves

more completely to their art, so much so that one might say the fresh impetus noted in the arts, in literature and music, for several years now, in the province of Quebec was indirectly but most surely brought about, to a large extent, by the C.B.C.
Moreover, the C.B.C., through its programs, many of which are broadcast not only in Quebec but throughout Canada, has enabled many people who otherwise would have been unable to do so, to share in this renewal of culture, and to enjoy themselves while so doing.
Mr. Chairman, in recalling the special contribution of the C.B.C., I know I am expressing the majority opinion of those who, in the province of Quebec, are interested in things of the mind. Who would have thought, two years ago, that today we would be faced with attacks of a scope of which we are perfectly aware, against the C.B.C.
In making these remarks, I would not like to give the impression, however, that everything is perfect in the C.B.C., as far as administration and programming are concerned. In such a complex and difficult field, one must admit it is impossible to please everyone at the same time. It is even possible, as it happened recently, that serious mistakes may be made. It is possible that some programs which gave rise to serious attacks on the part of the great majority of the population of Quebec-I am sure-do appear on television, and it is also normal that the competent authorities should vehemently denounce such errors, as they did recently, in order to avoid their recurrence.
What I do not accept, however, is that such errors should give rise to scandals and protests from people who are now trying to sow public immorality in the province of Quebec by every means at their disposal.


Paul Léo Maurice Johnson: Who are they?


Lionel Chevrier: The fact remains that despite some mistakes, the C.B.C. has done a magnificent job-


Mr. Pigeon:: Specify.


Lionel Chevrier: -which should be continued and extended. The C.B.C. is one of our main bulwarks against cultural invasion from the United States. Indeed I did indicate in a number of instances, when sitting on the other side of the house-the Leader of the Opposition mentioned this again this
Supply-National Revenue morning-that the C.B.C. is our strongest defence against the invasion of our culture by United States programs. Despite the important contributions of our institutions of learning and other instruments of culture, Canada's cultural future would be gravely jeopardized without the existence and continued progress of the C.B.C.
Therefore, Mr. Chairman, I am convinced that every member in this house, at least those sitting on this side, will bear this testimony to the C.B.C.
Now sir-


Paul Léo Maurice Johnson: What testimony?
(Text):


Lionel Chevrier: Now, sir, to continue to fulfill its vital role and to progress as we think it should, the C.B.C. needs two things. It needs, first of all, money, and it needs independence. Some members of the committee are surprised, and in fact they are even scandalized, at the annual deficits of the C.B.C. I have no doubt-and I am sure the committee is of the same view-that substantial savings could be made by more efficient administration. I want to emphasize, however, that in a country like Canada the C.B.C. would not fulfil its role if it were not incurring substantial deficits. I would go even further and say that I would be against the C.B.C. if it were to become solely a profitable organization, because that would mean that it would not accomplish the purpose for which it was established.
The deficit this year, as the committee knows, is some $51 million. This is, of course, a tremendous amount of money. However, when we look at what we are spending each year to defend our culture and our institutions against possible aggression we should come to the conclusion, it seems to me, sir, that the amounts we devote to our cultural enjoyment and development are very small indeed.
The major threat faced by the C.B.C. at the present time, however, concerns its independence, its freedom from political interference. We are not always conscious of the fact that there are two different aspects to this question and this threat. In the first place there is the manifestation of political interference itself. In the second place, there is the way in which those who are chiefly responsible for C.B.C. management react to that threat.
Political interference is certainly a most undesirable thing. I do not believe there is

Supply-National Revenue anyone in this committee who will gainsay that statement, but it is disastrous when C.B.C. management and those associated with it comply with such interference. There is no more effective method of destroying the C.B.C. than by transforming it into a political instrument of the government, and that is what those of us who sit here, as well as those who sit in the small group at the other end, want to make sure will not occur. That is why the most important responsibility of the C.B.C. is to resist that kind of interference.
I admit that it is not an easy matter. I admit that under the circumstances in which we find ourselves sometimes it is extremely difficult to resist pressure. Parliament, however, and the Canadian people have repeatedly decided that the C.B.C. would not accomplish a useful purpose if it were not free from governmental political interference, clandestine or otherwise.
That freedom, sir, and that independence which are so essential to the cultural welfare of the Canadian people have been entrusted by parliament to the C.B.C., and it is the major responsibility of its officials to preserve and maintain those essential requirements of that public service. The independence of the C.B.C. is as important to our democracy as academic freedom in our universities and other teaching institutions. It is as important for the officials of the C.B.C. to maintain the independence of that institution and to fight for it, if necessary, as it is for university authorities and university professors to preserve academic freedom.
To preserve those great democratic values may require at times, from those who are entrusted with the safeguarding of those values, a tremendous amount of courage and even the sacrifice of their jobs and their careers. However, our democracy expects those sacrifices from them because they have accepted those important responsibilities, and they must now live up to them. That is why all the C.B.C. officials who recently decided to resign over the issue of "Preview Commentary" have won our admiration for the courage they showed on that occasion. As far as we are concerned, here in this house, it is our duty to protect and support those people in the C.B.C. who carry these responsibilities and who resist political interference, even risking their careers to do that which they rightfully feel and believe is their duty.
The safeguarding of the independence of the C.B.C. has not been entrusted only to its

management. It is also the duty of the government to respect that freedom, and we have good reason to believe that the government has failed in that duty.
There are still widespread rumours that there was direct interference in connection with the radio program "Preview Commentary". Apparently the real story of this dramatic incident has not yet been told. It is widely reported that the Prime Minister himself advised-I use that word because it was used before-the Minister of National Revenue that his head and that of Mr. Bush-nell would roll if that program was not dropped immediately-


Mr. Lambert:: That is tommyrot.


Mr. Bell (Carleton):: Irresponsible gossip.


An hon. Member:: Where is the evidence?


John Whitney Pickersgill: We were not allowed to get the evidence.


Lionel Chevrier: -advice which it is reported was communicated to Mr. Bushnell, who informed several C.B.C. officials of it. Well, Mr. Chairman, there has been a great protest from the other side of the house in connection with that statement, and there has been an endeavour in the report of the committee to whitewash that affirmation completely, notwithstanding the evidence which was given in that respect.


Norman Platt Lambert: Where is the evidence?


Lionel Chevrier: The least that should be done by those who are in office and those who are responsible for this series of events is to deny that suggestion and put the position of the government clearly before the house.
I want to leave that matter now and deal with the French network of the C.B.C. According to similar reports the independence of the French network of the C.B.C. would appear to be in greater danger than the English network. We all remember, of course, the most unfortunate incidents which occurred in Montreal at the beginning of the year. On that occasion the Minister of National Revenue was quite unfair, I submit with deference, to the employees and especially to the producers of the French network in Montreal. At that time he blamed the producers for the dispute. His statement will be found on pages 775 and 776 of Hansard for February 6, when he said:
I also want to pay tribute, Mr. Chairman, to the management of the C.B.C. for the way in which they have conducted themselves during this strike. This has been the most unfortunate and unnecessary episode in labour relations in Canadian history, in my opinion. It is something which never should have happened.

He also made other accusations against the producers. However, about six months later, during the course of the committee meeting on July 2, when the minister appeared before the special committee on broadcasting he had changed his mind. As found at page 605 of the proceedings, in referring to the top management of the C.B.C. he had this to say:
Going back over these other occasions, like the Algerian matter, the Mother d'Youville question, the case of the person being brought in from Europe and also the background of the strike, where I was told afterwards if they had exercised any control here, the strike would not have happened, I probably told them, "You had better tighten up this organization or something will happen to somebody around here."


George Clyde Nowlan: Hear, hear.


Lionel Chevrier: The minister says "Hear, hear", so there is no denying this statement. The minister therefore admitted before the committee that he learned afterwards that if management in Ottawa had exercised any control the dispute would not have developed. The minister was quite wrong earlier and it seems to me that in so far as the producers involved in the Montreal dispute are concerned he owes them an apology and should make amends to them.
In connection with this whole matter concerning the French television network I want to refer to an article by Mr. Mark Harrison of the Toronto Star.
(Translation):


Léonard-David Sweezey Tremblay: Why don't you read the pastoral letter from our bishops?


Lionel Chevrier: If the hon. member will allow me the time, I intend to put on the record-


Paul Léo Maurice Johnson: Address yourself to the
Chairman of the house.


Lionel Chevrier: -what religious authorities have said at a conference which was held not long ago.
(Text):
Evidently, Mr. Chairman, what I am saying is not appreciated by the hon. members who are continually interrupting. They do not like the fact that we have been saying repeatedly that in the province of Quebec they have been interfering with the management of the C.B.C. Why? Because some of the commentators have been disagreeing with statements made by themselves and by other government members. I should like to come back to the article by Mr. Mark Harrison published in the Toronto Star of July 2. It reads in part as follows:
Nowhere is the C.B.C. more exposed to political pressure than in the French network in Quebec. Surrounded by hostile politicians, C.B.C. producers 66968-9-400
Supply-National Revenue in Montreal have been continually harassed in the past two years by attempts to undermine the independence of the corporation. The pressures have come from old C.B.C. adversaries-Duplessis supporters emboldened by the entrenchment of a Conservative administration in Ottawa. They have also come from the new Quebec Conservative M.P.'s who appear to assume their parliamentary status entitles them to influence policy in the corporation.
How do they apply these pressures against the C.B.C.? Mostly in a covert manner, seeking to make their influence felt through the federal cabinet, primarily through Solicitor General Leon Balcer and Senate Speaker Mark Drouin.
Last winter, for example, two confidential documents, blasting the talks and public affairs branch of the C.B.C.'s French network, were prepared by a group of Quebec Conservatives and submitted to the government. The documents have never been made public but it is understood they contained two major indictments:
1.	That the C.B.C. Montreal group was riddled with left wingers.
2.	That a few favoured commentators were appearing too frequently on the C.B.C. in Montreal.
The commentators to whom the Conservative M.P.'s objected were men like Jean Louis Gagnon, editor of La Presse, Gerard Pelletier of the Catholic syndicates and Andre Laurendeau, an editor of he Devoir. The documents were passed on to the C.B.C. and the French network officials were required to submit reports which, in fact, were rebuttals of the charges.
I have not the time to read the questions and answers made by the minister responsible for the C.B.C. concerning this matter, but he did not deny the statement contained in that editorial. We have, therefore, good reason to believe that some of these pressures and some of these representations have been successful. Thus it has been decided to drop the program "Point de Mire", which had been tremendously popular and a tremendous success, by Rene Levesque. What justified that decision? Was it the fact that Mr. Levesque participated actively in the Montreal strike for which the producers and artists were not mainly responsible, according to the minister's new version? Surely this would not be acceptable. Was the program abandoned because some Quebec Conservative members, like the hon. member for Roberval, did not like Mr. Levesque? This would be most unfair.
Personally I do not know what the party affiliations of Mr. Levesque are, and this has nothing to do with the present situation. I do know, however, that Mr. Levesque is an objective commentator. I do know that he is a man who knows international and national subjects, and that he is listened to very carefully by a large part of the population of the province of Quebec. The proof of that lies in the fact that in the survey which was made of French television programs, it was "Point de Mire" which topped the list.


Paul Léo Maurice Johnson: Who made the survey?

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Lionel Chevrier: Why then, I ask, was it decided to discontinue this program? We are certainly entitled to a full explanation of this from those who are responsible. Was it because some Conservative members from the province of Quebec complained that he was being seen too often on television? This is a complaint we hear very often, as was stated to us by the hon. member for Roberval.
What is the matter with an individual appearing often on television, provided he is able to entertain and give the public what they want? After all, you cannot take a man off the C.B.C. television network because of the fact that he has a wide and varied experience, and supplant him by another who has little or no experience, until that other has attained such experience. The complaint in itself is no justification whatever. The only acceptable criterion in this respect is whether the commentator is sufficiently interesting to keep his audience, and whether the program is achieving a useful purpose. It would be most regrettable if the C.B.C. had to drop its most popular French programs simply because of asinine arguments made by members such as the hon. member for Roberval.
In the last analysis the public should be the final judge of this question, because the function of the C.B.C. is to serve the public, not to satisfy the vengeance of political parties and members of parliament. I admit the C.B.C. should try, and it certainly did in the past, to develop new talent. However, it would be ridiculous if the C.B.C. had to drop artists and commentators as soon as they have acquired experience. The C.B.C., I am told, has not asked Mr. Levesque to continue his program "Point de Mire". This is unfair not only to him but also to the public who liked his presentation in the province of Quebec. This decision cannot be explained otherwise than by political interference, and I ask the minister to tell the house what has happened in this connection. Such pressures have also resulted in the dropping of other programs and other regular commentators from the French network of the C.B.C.


George Clyde Nowlan: Nonsense.


Lionel Chevrier: If it is utter nonsense, as the minister has interjected, why has the program not been reinstated in the same manner as "Preview Commentary" has been? There has, no doubt, been some kind of interference in connection with "Point de Mire" and other programs on the C.B.C., as there was in connection with "Preview Commentary". It strikes me that interference has come from the sources I have just enumerated.

The Quebec Conservative members and their political allies, the Union Nationale, are now trying to destroy the C.B.C.; or at least if not, they are trying to prevent it from discharging the most important responsibilities it has to discharge in the province of Quebec. In order to achieve their purpose they resort to public denunciations of the C.B.C. and employees who are not in a position to defend themselves, and in this way they hope to destroy the morale of these officers of the C.B.C. and spread fear amongst the employees, with the hope that, put in that position, they will remove themselves and go off to other spheres.
They may get away temporarily with these unfair tactics. I want to tell them, however, that if they succeed in destroying the C.B.C., either by fear or through lack of funds or by reducing the C.B.C. to a political instrument of the government, they will be responsible for a major blow to the development and progress of the culture which they pretend to be serving and defending. I want to tell them also that in spite of a few mistakes which have been made by the C.B.C., this public service is still strongly and enthusiastically supported by public opinion.
I repeat that we on this side of the house and the Canadian public generally are entitled to get from the government a clear and complete statement of its broadcasting policy. This has not been forthcoming. This has not been given, either in the committee or here by the minister, and I think the time has arrived for the minister to tell this house that he, as the one speaking for the C.B.C., will not for one moment stand for interference, no matter from where it comes, be it from the members from the province of Quebec or elsewhere, in the programming of the C.B.C.
He and his government have repeatedly stated, not only during the dispute in Montreal but earlier on other occasions, that they will not permit interference in the affairs of the C.B.C. Well, if that is the case, then it appears to me that he should give instructions, in the same way instructions were given that "Preview Commentary" be returned to the air, to the C.B.C. to restore "Point de Mire" and other programs which have been taken off. In the present unfortunate circumstances what is needed to restore confidence and morale is an authoritative statement by the government. I sincerely hope that will be forthcoming.
Then, sir, the hon. member for Roberval a moment ago challenged me to put on the record certain statements in connection with what happened in Montreal recently. I hold in my hand a clipping from the Montreal

Star dated July 8, 1959 entitled, "RC Group Presents Views on TV, Radio". I quote:
It is time to stop wholesale condemnation and negative criticism of radio and television productions, Paul Emile Cardinal Leger said yesterday.
That is just the opposite to what the hon. member for Roberval told us in his 25-minute speech. He went on to be critical and to condemn many of the things that were being done by the C.B.C. None the less the head of the church in the province of Quebec did not hesitate to say that it is time to stop wholesale condemnation and negative criticism of radio and television productions.
At the meeting which took place at that time a series of resolutions were passed. I have not time to put them on the record, but they are there for anyone who wants to see them. I conclude, sir, by saying the time has arrived for the government to make it quite clear that there will be no interference in the programs on the French network of the C.B.C. I hope the minister will not only do that but that he will see to it that, in the same way "Preview Commentary" was restored to the air on the English speaking network, "Point de Mire" and other programs which have been dropped in Quebec will be restored to the French network.


Herbert Wilfred Herridge: Mr. Chairman, I had intended to make some extended remarks on this item, because I am very much interested in the C.B.C. and all connected with it. But owing to the desire of the house generally to proceed as expeditiously as possible today I am going to deny myself that treat and enjoyment. However, the hon. member for Port Arthur placed before this house this party's position with respect to the C.B.C., and since coming into the house I have heard from a number of hon. members that his presentation was very well received even by members on the government side of the house, and that it was a constructive contribution to this most important subject.
I am going to deal with one or two matters that are of local interest, but before doing so I must say that I have received many letters-and I know a great number of people in my constituency-in connection with C.B.C. news programs and commentaries. These programs are enjoyed and appreciated by a large section of the population, that is to say that section of the population in my constituency which has the opportunity to enjoy those programs. I may say that included in those programs are excellent commentaries conducted by various members of the press gallery whose names have become almost household words in most of Canada because of their commentaries on radio and television.
66968-9-400i
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However, it is because of the fact that the C.B.C. and its programs are appreciated in a large portion of my constituency that those who are still denied even radio reception are becoming more and more vocal in their protests against this continued denial of radio reception. Here we are spending huge sums of money developing television, yet in Canada today we stiR have sections of this country, such as the northern portion of my constituency where there are about five thousand people at the present time, who are denied the opportunity even to hear Canadian Broadcasting Corporation radio programs.
I have made this protest over a period of 14 years, Mr. Chairman, and we have made some progress. We are pleased to know that low power relay transmitters are going to be established this year at Slocan and New Denver. That is a step in the right direction, and the persons who will be served appreciate it very much. We still have two other areas which are not served by C.B.C. programs and which have extremely unsatisfactory radio reception. I refer to the Arrow lakes area and the area surrounding the Bal-four-Procter axis in the Kootenay lake district.
I am not going to take up the time of the house on this matter except to again plead for these people who are denied even radio reception while others are enjoying television. These people who are living to some extent in the hinterland are producing a tremendous amount of wealth. Those in the upper Arrow lakes area produce one hundred million feet of lumber a year. Consider the revenue that comes from the loggers and sawmill operators in that district. Yet at the same time they are denied the opportunity to listen to C.B.C. radio programs, let alone television. The same situation exists with respect to people around the Kootenay lake area. I urge the minister to prod the C.B.C. along in this respect. When he is replying on this item of his estimates I should like him to give those people some information as to when they can expect these services.
There is one other matter to which I should like to refer. In June of last year the minister confirmed the fact that a television satellite station was to be established at or near Trail to serve the Rossland-Trail area. Apparently there have been some unexpected delays in acquiring an appropriate site, but here again we find a large industrial section producing a tremendous amount of wealth. Naturally, although they enjoy radio reception-which is something the people about whom I have been speaking still do not enjoy-I have been asked to bring to the attention of the house and the minister the fact that

Supply-National Revenue they are looking forward to early action with respect to the erection of this television satellite station to serve the Rossland-Trail district. When the minister is replying I would appreciate it greatly if he would give me some comfort and hope in that direction.


John Whitney Pickersgill: I should like to make a few observations which I intend to base on the report of the committee on broadcasting.
I want to say first of all how disappointed I was-this opinion was also expressed by the hon. member for Port Arthur, and I think I reflect the view of all the opposition members-that the committee did not carry out the functions which the Minister of National Revenue told us last year it would be set up to carry out, namely to examine policy and examine the working of the new legislation. Instead of that, in spite of the fact that the minister's words were drawn to the attention of the committee at its opening sitting, the committee was in my view perverted into something that came very close to a witch hunt and persecution of the C.B.C. on the part, I do not say of most of the majority members but of certain of the majority members, who certainly monopolized most of the time of the committee.


Some hon. Members:: Oh, oh.


Paul Léo Maurice Johnson: You monopolized most of the time.


John Whitney Pickersgill: I hear the hon. member for Chambly-Rouville say that I monopolized most of the time. I almost raised a question of privilege in the committee because a very distinguished journalist wrote about me that I merely went into the committee for five minutes, obtained headlines and then left. You cannot have it both ways. The fact of the matter is that I sat patiently- through all but one of the sittings of that committee practically from the beginning to the end, all but one of the sittings that were held when the house was not in session. There was one occasion when it was quite impossible for me to be there. I admit that most of those sittings that were held when the house was in session-and I do not blame anyone for it-took place when I felt it was my duty to be here rather than there. I might say that anybody who wants to examine the record of almost any of the meetings will find that the number of interventions by me was relatively small, and that they almost invariably dealt with questions of principle-


Norman Platt Lambert: Politics.


John Whitney Pickersgill: -policy and legislation.


Norman Platt Lambert: Politics.


John Whitney Pickersgill: There was a little politics, that is quite true. There was a little politics

when a shocking attack was made upon public broadcasting in Canada by the premier of the most populous province of Canada, and I thought the premier of that province should be invited to come to the committee in order to give us his views. For political reasons hon. gentlemen opposite used their majority to prevent any such thing being done.


Norman Platt Lambert: There were a great many other occasions when you used them, too.


John Whitney Pickersgill: That is the only case I can recall offhand.


Norman Platt Lambert: Don't be so modest.


John Whitney Pickersgill: Other hon. gentlemen can give their own testimony on this subject. The Leader of the Opposition was critical; but understandably, since he was not a member of the committee, he was relatively mildly critical of the report of the committee and of some of its deliberations. I agree with everything he said, and I should like to reinforce it a little. I want to examine these recommendations seriatim. The first one does not need much time spent on it, as the hon. member for Port Arthur pointed out. It reads as follows:
Your committee affirms its support of the basic aims and objectives of the C.B.C. We commend the officers of the corporation for their efforts to further these aims and objectives.
There it is. There is not another thing in that report that indicates that they are trying to do anything to attain those objectives. From there on the recommendations deal with breaking down the capacity of the C.B.C. to do those things, or with matters irrelevant thereto.
The next recommendation is:
Your committee regrets that it must report its conviction that the administrative structure of the corporation is weak and in need of a thorough revision. There is a lack of clear definition of responsibilities and authority of the various executives and junior executives of the corporation.
I must say that I do not agree at all with that recommendation. I do think there was obvious evidence of weakness at the very top; I do not think anyone could argue that. But for the rest of the officers who appeared, I have very grave doubts as to whether there is any private corporation in this country which could send the number and variety of its officers to be put through the kind of inquisition these witnesses were put through and have them as clear, as candid and as precise about their functions.
It did not seem to me, therefore, that there was any warrant whatsoever for this wholesale suggestion. I think everyone would agree, and it would be silly not to

agree, that for reasons perhaps partly stemming from Mr. Dunton's resignation and then the illness of Mr. Ouimet and the extraordinary burden thrown on Mr. Bushnell, there was weakness at the top; but in the corporation generally I found nothing whatever to warrant this, and of course no concrete evidence is cited in this recommendation.
Then the next recommendation:
Your committee believes that the board must assume full responsibility for policy-
Of course I do not agree with that either. The position of our party, as the Leader of the Opposition pointed out this morning, is that the policy for broadcasting should be made by the board of broadcast governors for the whole national system, public as well as private, and having a board of directors of the C.B.C. is at best redundant and at worst likely to lead to confusion; and, as the Leader of the Opposition pointed out at the last session of parliament, likely to create a divorce between the public and private systems, which would be regrettable.
That does not mean at all that we do not think the private sector of broadcasting- I should have said I do not think-has an important part, and an increasingly important part, to play; but the original conception from 1936 on was that there should be one integrated system with public and private parts complementary, and not two separate systems. It seems to me that already we have had a lot of evidence on this point, including the evidence given by the chairman of the board of broadcast governors, who gave his evidence very precisely and very concisely and who made it very clear that, as things operate now, they have no initiative at all in an effective sense in the field of policy.
Then coupled with this is the recommendation that-
-the person occupying the position of chairman of the board shall not hold other executive offices in the corporation, and that a chairman of the board be appointed.
I have some doubt as to whether the committee had the power to make that recommendation, because we were not asked to recommend changes in legislation; but perhaps that is a pedantic objection. I must say that in default of anything better I think this would be some improvement on the existing situation. It would provide a little of that insulation which the Leader of the Opposition indicated very clearly this morning was lacking and of which we need a lot and not just a little.
I pass over the next recommendation for the moment, because I want to say something about it later. It is the one having to do
Supply-National Revenue with clandestine political influence. The next recommendation I come to is this:
Your committee recommends that a senior officer of the corporation, with headquarters in Ottawa, be vested with the clear authority and responsibility for all supervision of production.
That, and several other recommendations which come later on, struck me as indicating a fundamental weakness in the approach of the majority of this committee to their duties. They seemed to think that this committee was appointed to run the C.B.C. This parliament last year over our objection established a board of directors to run the C.B.C., and this report is filled with administrative directions to that board of directors. The worst feature of that, sir, was that the committee took it upon itself deliberately to usurp the authority of the board of directors.
The Minister of National Revenue came to the committee and reinforced the reasons given by the C.B.C., some of them I admit perhaps not as convincing as they should have been, why certain information of a commercial character should not be given to that committee. Notwithstanding the fact that the minister made a very strong case-I thought it a more convincing case than the C.B.C.'s on this particular point-and notwithstanding the fact that all the opposition members of the committee voted to sustain the position of the minister, the majority of this committee took it upon themselves to disregard his advice and to insist upon asking for this information.
But that is not all; we then have chapter 2. There was a formal meeting of the board of directors, this board of directors which was set up by the whole of parliament, not just this little committee, to carry on the affairs of the C.B.C.; and this board, appointed by this Tory government, a board which one would imagine would not be unfriendly to the government, passed a resolution asking the committee to reconsider this matter. And what happened in the committee? Every supporter of the government voted against what the minister wanted; they voted against what the board appointed by the government wanted, and voted to insist upon overriding parliament. That was the kind of committee we had; and the only members of that committee who voted to uphold what has been, since Mr. Meighen laid down those principles about the C.N.R. in 1919 or 1920, the proper attitude toward the running of a public corporation were the opposition members of the committee.
Now, sir, it seems to me we have to make up our minds one way or the other. Either this parliament is going to show some reasonable confidence in the directors appointed to

Supply-National Revenue manage these corporations, or it is going to get rid of them because it has no confidence in them. The idea that we can usurp their functions and set up committees which disregard the advice of the minister who has to answer is, in my view, the negation of our British system of responsible government. It is importing into our system of government the United States system; and I must say that when I heard the Prime Minister's remarks this morning about the committee system I thought the Prime Minister himself was beginning to get worried. The Prime Minister said, as I remember it-I am just paraphrasing-"We are not trying to introduce the United States system." Whether or not the government is trying to introduce it, certainly many of the members of this committee acted as though that were being done.
The committee then went on to say that they gave lengthy attention to the financial operations of the corporation, and that is not a recommendation. They then went on to say something about extending service. That is one recommendation I do agree with. As rapidly as it reasonably can be done I think service should be extended to all Canadians to whom service can be extended. There is one other sentence with which I agree unreservedly, and it is this:
Your committee was unable to ascertain that there is any intelligible formula or pattern used in determining the annual budget of the C.B.C.
That is exactly what we said about this legislation last year,	and	that is exactlywhat the Leader	of	the	Opposition	saidabout it at page 4053 of Hansard of last year. I wish I had time to read what he said, because it was borne out completely by the evidence which was brought before us on the very first day.	It	was	quite clear	thatwhat we said at	the	last	session of	parliament was true, namely that, as long as they had annual budgets based on no kind of principle except that of asking for as much as they thought they could get, with the Minister of Finance trying to keep the amount as low as possible, it meant that this corporation to all intents and purposes was under the thumb of the Minister of Finance. I am glad the committee recognized at the end of its sessions that what some of us recognized on the very first day was true, but I do not think much of the proposals they have for dealing with the problem.
It seems to me, as the Leader of the Opposition pointed out so well this morning, that there is only one way of dealing with this problem, and that is by some means or other, for a reasonable period of years, to permit reasonable planning, to give to the

corporation an assured budget based on some automatic formula that cannot be changed by the Minister of Finance, the treasury board or the governor in council; a formula that will be decided by legislation in this parliament, and which will stand until it is changed by parliament. Before any formula of that sort would be changed I should think it would be wise to do what has always been done in the past, have an investigation of the character of the Fowler or Massey commissions.
These other recommendations about commercialism and the other cases where the committee undertook to tell the board of directors how to run the corporation, I am not going to discuss very much. I think this whole conception of commercialism is entirely wrong. That does not mean that I do not think the corporation should get as much out of the advertisers as it can, because I do; but I think it is entirely wrong to talk about subsidizing advertisers. What the corporation is supposed to do is to give the Canadian people the kind of programs that are needed in the national interests of Canada, and to try to get a part of those programs paid for by commercial interests. I am not the least bit in favour of letting commercial corporations go into the field and run programs in place of the C.B.C.


Mr. Bell (Carlelon):: Well, who is?


John Whitney Pickersgill: I direct the hon. member's attention to the last of the recommendations, which suggested that this should be taken over by sponsors or advertising agencies.


Thomas Miller Bell: That is a complete misunderstanding of the report.


John Whitney Pickersgill: It may be a complete misunderstanding of the report, but it is an understanding shared by most of those who have read it. I come back to the paragraph in the report which I passed over. I refer to this incredible and extraordinary statement;
Your committee investigated the charge that "clandestine political influence" was responsible for the removal of the program, "Preview Commentary" and found no evidence to support the charge.
Well, we did not find any evidence that did not support the charge; nothing; not a tittle of it. First of all Mr. Bushnell admitted quite frankly that he believed his head would roll unless he did something about that program and did it quickly. He communicated that belief to the senior officers of the corporation. They ended the program in a panic, and then got into a second panic and put it back on the air. We attempted to solve the whodunit, to try to find out what the channel was through which Mr. Bushnell got this impression, which I do not think

was an hallucination on his part, though it might have been. We wanted two further witnesses. The steering committee agreed to have one of those witnesses, but the hearings were terminated abruptly before that witness could be heard. We wanted to have another witness, a member of the board of directors, who according to testimony already given really knew something about this matter, but we were turned down by every member of the majority voting against extending an invitation to those witnesses who might have been able to solve this problem.
Why? I do not know why, but it was evident that there must have been a fear on the part of the members of the majority that the evidence would be very damaging politically.


Thomas Miller Bell: Ridiculous.


John Whitney Pickersgill: The hon. gentleman can make his own speech in his own time. I want now to make one or two further observations about this whole question. One thing we know is that this program was cancelled suddenly, precipitately, and we were even told that it ought to have been taken off the air a week before it was. Let me read these words:
-the fact is that it was cancelled after it had been announced. Why was it cancelled? Who reached the decision to cancel it ?- On what grounds did they make their decision? With what information before them and with what communications before them did they reach that decision?
I ask the minister that. I continue:
Looking about for the source of this idea to cancel an announced program (an announced series of programs) which to say the least were not always complimentary to (the government), is it not fair to ask this question: Where does the advantage accrue from such a cancellation? To even the most untutored in the tortuous ways of this government it is perfectly obvious that the only advantage that could accrue from the cancellation of that program was an advantage to the (Conservative) party and the government opposite. Hence, Mr. (Chairman) we are left with two alternative explanations.
The first one is that this program must have been cancelled by request of the government. I am not so naive as to suggest that the Prime Minister wrote a letter to Mr. (Bushnell) and asked that this program should be cancelled. Oh, no; I do not make that suggestion. I do not even suggest that the Minister of National Revenue necessarily picked up the telephone and called Mr. (Bushnell) or spoke with anyone representing the (C.B.C. management).


George Clyde Nowlan: That is sheer nonsense and you know it. Your conduct is befitting a kindergarten.


John Whitney Pickersgill: I agree, Mr. Chairman, that this statement was sheer nonsense when it was uttered by the hon. member for Eglinton on February 7, 1956, as reported at page 947
Supply-National Revenue of Hansard in connection with another incident, but it is not on this occasion. I am interested that the minister should have used the very favourite expression of the hon. member for Eglinton in talking about what he describes as "sheer nonsense". But how well it applies. I am going to read a few more lines, because these words apply so very well to this situation.


Thomas Miller Bell: There was some
evidence then.


John Whitney Pickersgill: The hon. gentleman can deal with that in his own time. It happens that there was absolutely none. Let me continue quoting what was said by the present Minister of Finance who was then the private hon. member for Eglinton. Hon. members may have observed that I am paraphrasing this statement only to the extent of substituting the word "Conservative" for the word "Liberal" and by making other relevant substitutions which no doubt will be indicated in this record in parenthesis. I continue:
I am not even suggesting that the Minister of Finance necessarily communicated, perhaps by artful stratagem or hint, the feelings of the government in this matter or his personal feelings which would be the same thing. But, Mr. (Chairman), by whatever method the view was conveyed or the hint, it is quite obvious that the feelings of the government were not offended by the cancellation. That is one of the two possible explanations.
The other alternative explanation is that the (C.B.C. management), in proceeding to cancel this program, was acting in the interests of the government and the (Conservative) party even without direct government intervention.
Sir, of the two alternatives the second would be the worst for Canada because it would mean that- the responsible body in the Canadian broadcasting organization, was anticipating government desires in tihs matter and was showing such a tender solicitude for the partisan interests of the government as would serve the desires of the government. Take your choice, Mr. (Chairman), of those two alternative explanations.
Suspicion could not fail to be aroused by the method in which this matter has been handled- There was no frank, straightforward statement coming from them.
We remember the answer the Prime Minister gave on June 24. I advise hon. members to refresh their memories by looking at it. I continue with the hon. member for Eglinton in 1956:
No, it is quite obvious that they felt they had something to hide; they had something to hold back and therefore the (intervention) must be secret.
The Minister of Finance anticipated the kind of situation that would exist with a Tory government in office very accurately indeed, as will be seen from the reading of that passage. But he was not the only one who anticipated that. That is precisely what was said by the Leader of the Opposition in the

Supply-National Revenue reference I made a few moments ago to Hansard of last year. That was also said by several hon. members on this side. I could read other extracts to that effect. I do not want to take the time of the committee to do it.
I think the Minister of Finance was right in this, that the greater of the two dangers in this business of voting annual appropriations, the more serious one, is the insensibly, inevitably, because of the corporation's desire to retain its employees, to preserve its status and to continue to grow, if this system of annual appropriations under the thumb of the Minster of Finance is long continued, human nature being what it is, the corporation will try to please, try to ingratiate, try to make sure, particularly in the autumn when treasury board is going to be looking into these matters-and we were given evidence that treasury board did look into them, that there was no question as there is with the C.N.R. of a budget, but there was a fairly detailed examination-we will find that this will insensibly happen, probably for a little while, anyway, for a few months. That may be a greater danger than the danger of direct intervention because of displeasure, perhaps because the government, having had its fingers burned rather badly, may be more cautious for a little while. The whole system is pernicious; it is thoroughly unsound, and it seems to me, sir, we ought to go back to first principles here.
The United States view is that broadcasting is so dangerous-that is, domestic broadcasting within their own country-that the state should not be engaged in it; that it is a danger to freedom. Now, to some degree that is right; to some degree it is true that there is always a danger within a mechanism owned by the state. No matter how great the independence that is given to it, it may become an instrument of the government in office and be a potential danger to our system of free and democratic government, to that proper balance between the government and the opposition which is so essential to the preservation of that freedom. But we have recognized in Canada that if we are to have a national identity side by side with a country so much more powerful than ours we have to have an instrument like this, just as we had to have a transcontinental railway nearly a century ago for the same reason.
Perhaps this is even more essential than the railway was to our preservation, but the only way we can do that is to keep this mechanism divorced as completely as possible, compatible with the parliamentary control over expenditures. That does not mean, sir, that you have to have parliamentary

control over the day to day expenditures, and you certainly should not have governmental or treasury board control over them.
My view is-and I feel it even more strongly than I did before-that treasury board control is wrong; that the right system is some kind of ceiling, some kind of automatic one. I do not think, if it is properly calculated, we will need to worry very much about what happens below it because the corporation, as everyone with a limited income will have to choose what is best within that ceiling on income.


Douglas Mason Fisher: There are three brief points that I overlooked. One is that I did not make reference to the service rendered to the committee by the chairman, the hon. member who makes his home in London. I must say that while I disagreed with much of the report and with some of the things that went on in the proceedings, he was a pleasant chairman and one who tried within the limits of all the contentions within the committee to be as fair as possible.
The second oversight is that I failed to mention that one of the recommendations in the committee report was very dear to my heart; that in spite of the service that is given to the metropolitan areas, which are well served, I think it is well to remind hon. members that there are quite a large number of hinterland areas of the country that still very much need the carrying out of the recommendations in this regard.
The third oversight, Mr. Chairman, was brought to my attention by a member of the government side of the house, who suggested that I was less than fair in my comments about them and their behaviour in the committee. In order to rectify that situation, Mr. Chairman, I just want to read from page 610 of the committee's proceedings. I think the committee will gather from the mood and rather confusing position that are revealed by the questions and the answers that this is what I was referring to. On page 610 the hon. member for Vancouver-Burrard asked these questions, and I look on this gentleman as a typical member of the government forces on the committee.


John Whitney Pickersgill: May I ask the hon. member for Port Arthur if that is not rather unfair, even to the committee?


Douglas Mason Fisher: No, I think he is a typical member, and this is an example of the confusion that I was talking about. He was directing his questions to the minister. He said:
As long as you have to answer to parliament for the operation of the C.B.C., and as long as the government subsidizes the C.B.C. to such an extent, I presume there will always be political interference-proper interference-in the C.B.C.?


George Clyde Nowlan: There has never been any interference, as far as I know, in any way, shape or form.


Mr. Taylor:: Meeting of minds?


George Clyde Nowlan: There has been no meeting of minds.
I think that is true, too. I continue:
I have conveyed-as I said-every complaint I received in writing to the C.B.C. I undoubtedly have conveyed some-in general-of the verbal representations that I have received.


John Russell Taylor: I do not mean of an improper kind at all; I mean, there must always be meetings with C.B.C. officials for one reason or another, where the government is subsidizing this corporation to such an extent?


George Clyde Nowlan: There are meetings constantly, because we get these representations and recommendations. I have given one-this question of the theatre. I have had a score of them that I have called up about and said, "I want to get more information on this" and asked them to come up and talk to me.


John Russell Taylor: It could not be otherwise, could it?


George Clyde Nowlan: It has not been otherwise; and it could not be, unless the minister is simply going to be a rubber stamp and pass things on-which I have not been.
The only point about that question to me is that it supports my earlier contention that very many members-I think here was a typical member-on the government side have really not thought out clearly what the C.B.C. is doing, or what it is supposed to do and what its relationship under the legislation should be with the government.
In closing I would like to reiterate what the hon. member for Bonavista-Twillingate said, in so far as some of the recommendations of this committee interefere in the very area that we set up an authority for last year, and that is the authority of the C.B.C. board of directors.
(Translation):


Mr. Brassard (Lapointe):: Mr. Chairman, I will take only five or six minutes of the time of the committee. I want to endorse the remarks and the congratulations that the hon. member for Port Arthur (Mr. Fisher) has made to the chairman of the committee on broadcasting, the hon. member for London (Mr. Halpenny), who discharged his duties with much dignity and ability in circumstances that were often quite difficult.
Mr. Chairman, while listening to the hon. member for Roberval (Mr. Tremblay), a few moments ago, I have recalled certain speeches that were made by the hon. member for Eglinton (Mr. Fleming), the present Minister of Finance. I wonder, however, if the hon. member for Roberval has spoken on behalf of the government. I hope that the Minister of National Revenue (Mr. Nowlan), when he speaks in a few minutes, will tell us if it is so, because it is quite important that we know 66968-9-401
Supply-National Revenue if all the theories which were put forward by the member for Roberval are endorsed by the minister responsible to the parliament of Canada for the administration of the C.B.C.
The hon. member for Roberval spoke at great length about education and culture. I will therefore give him advice which he, in turn might pass along to some people he knows quite well. The Quebec legislature, Mr. Chairman, has adopted an act to enable the provincial government to operate its own radio network in the province of Quebec. If it is indeed felt that the C.B.C. deals rightly or wrongly with education or culture, I believe the best way to relieve the problem, if it is a problem, is for the province of Quebec to apply to the C.B.C. board of directors for a licence to operate a radio and television station. In this way, Mr. Chairman, all those who object to the way the C.B.C. is carrying on, will be able to look after the cultural field in their own way.
Then the hon. member for Roberval referred to a document sent to certain C.B.C. officials in Montreal over the signature of Mr. Marcel Ouimet, and he read some paragraphs from that document. That very reference makes me doubt the purposes of certain members of that broadcasting committee, and I believe the document quoted by the hon. member for Roberval definitely proves that senior C.B.C. officials are doing all they can to give us programs that are balanced in every way.


Paul Léo Maurice Johnson: On one side only.


Augustin Brassard: The hon. member also referred to a letter from a certain newspaperman, sent along to the broadcasting committee. However, Mr. Chairman, as the hon. member for Roberval told us, we had agreed right from the start to refrain from personalities. But who dragged in the name of that newspaperman before the committee? The hon. member for Roberval knows perfectly well who it is, and I think that it was not fair to quote a letter charging certain C.B.C. officials without giving them the right to appear before us to tell us what they thought of the charge made against them.
The hon. member for Roberval-and I want to close with these remarks-dealt at great length with lack of efficiency in the C.B.C. But, if the government endorses the principles that the hon. member for Roberval has just set forth, and if it takes in consideration the recommendation contained in the report

Supply-National Revenue of the broadcasting committee, it could alleviate that lack of efficiency, Mr. Chairman, because the report of the committee recommended that someone be appointed in Ottawa, and that he should be responsible to the minister and to the people of Canada for the production, programming and content of C.B.C. programs.
Personally, I oppose that recommendation because I believe that the administration here in Ottawa, has able men who have the required knowledge to do this work. It would only be a matter of re-allocating the duties of certain C.B.C. officials here in Ottawa. But, I presume that that recommendation has not been made without a purpose, and if the government wants to take it in consideration and wants to get rid forever of the glaring incompetence of certain producers and of all C.B.C. officials, as the hon. member for Rober-val has indicated, I hope that the Minister of National Revenue-


Louis-Joseph Pigeon: Not all of them.


Augustin Brassard: -will appoint to this post the hon. member for Roberval. Personally, I would be quite happy about it.
(Text):


George Clyde Nowlan: Mr. Chairman, perhaps I should say a word before the item carries. The hon. member for Kootenay West asked about the installation of a satellite station and expressed the pious wish that I might bring hope and comfort to his heart. All I can say is that the proposal is one of a score or more which C.B.C. engineers are considering. It is on the program, but I cannot assure him just when I will be able to boost his heart to the extent he hopes. It is something which is in prospect in the relatively near future. I think that was the only question of local significance.
One of the gentlemen of the press gallery, who has appeared on this much discussed program, said the other day that at this stage of the session, when there was pressure for the house to finish, the government submitted to blackmail by opposition members who got up and made wild and unrealistic speeches from time to time and the government, knowing they had to get the house through by a certain date or having entered into some sort of discussion to that end or hoping that it could be accomplished, had to sit by and not reply in kind. That is the position in which I find myself this afternoon. I should very much like to reply to some of the statements which have been made.
[Mr. Brassard (Lapointe) .3

I might say immediately, in response to the inquiry made a moment ago by the hon. gentleman who just took his seat, that the hon. member for Roberval was of course speaking for himself. He is a member of the house who holds strong views, to which he is perfectly entitled, and as such he is entitled to every respect; but he does not speak for the government of Canada or for any phase of government except that as a member of the house he has the rights which we all have and which we respect.
In his opening remarks the Leader of the Opposition referred at length to the Canadian Broadcasting Corporation, and with all his statements with respect to the aims, objects and purposes of the corporation, its history and its contributions, no one could agree more than myself. There is no question about that whatsoever. No party has a monopoly on affection for the C.B.C. or anything of the kind. In my opinion the C.B.C. is one of the great national organizations of this country. It has made a tremendous contribution to the country and it is an organization of which most, if not all, Canadians are proud. It is one of which I am very proud. I subscribe entirely, as I said, to the views the Leader of the Opposition expressed with respect to the corporation, the contribution it has made to the country and the contribution it can make in the future.
The corporation has a very difficult role to play, as I know full well from the mail I get and the differences of opinion that are expressed. Some people are very critical and some people are complimentary. Some people look forward to getting television programs from United States stations. One thing that has impressed me more than anything else in connection with C.B.C. programs is the number of letters I get from United States citizens who, having lived near the Canadian border, have had to move farther south for business or other reasons and have been removed from direct contact with the Canadian Broadcasting Corporation. Their letters all express regret at missing Canadian Broadcasting Corporation programs, and say how superior those programs were and are to what they are receiving in the particular locality in which they now find themselves. I know there is a divergence of opinion in that regard, but that is one yardstick we can use, and it is surprising the number of letters one gets to that effect.
Much has been said this afternoon about the committee report. I am not here to make any defence of the committee. I do not think defence is necessary. I was very glad to hear the tributes paid by some members to the chairman of that committee. They

were well deserved. I think the same tribute can also be paid to the great majority of the committee members. The committee worked hard and sat long hours. I think it did a remarkably good job.
The hon. member for Bonavista-Twillin-gate protested because the committee brought in certain recommendations, and said it was unfair to the management of the C.B.C. Maybe that is a play on words, inasmuch as the recommendations have to do with matters involving management. I can remember a score of committees of the house that have brought in recommendations with respect to specific matters. They are not necessarily binding on the government, but are the opinion of groups of men and women who have sat for long hours, have heard witnesses and have arrived at certain conclusions by a process of discussion and sometimes, of course, by long discussion and modifications before something approaching unanimity was reached.
The report is a good one. I do not know how far the corporation will be prepared to go in carrying out the recommendations of the committee. I am not sure what if any recommendations involve government action. This is something to which the government will give consideration when time permits after the pressures of these immediate days are over.
Much has been said about this program "Preview Commentary". I am not going to rethrash that old straw again. The hon. member for Bonavista-Twillingate, who is sometimes logical and always political and has a habit of raising his voice higher the weaker his case, this time spoke more loudly than I have ever heard him before. I never heard him make such a poor presentation. I understand he is studying law, and I thought that undoubtedly some day he would be an ornament to the bar of whatever province he chose to join.
This afternoon, when he talked about evidence, I realized he had a long way to go before he became a lawyer. We all know there are books that have to be read during the law course, and if one wants to learn about evidence one of the elementary books one has to read is called "Phipson on Evidence". There are many other books on evidence, and I suggest to the hon. member that he should read a book or two on evidence before he starts trying to describe to the House of Commons or anyone else what evidence may or may not be.


Lester Bowles Pearson: Is a parliamentary committee a court?


George Clyde Nowlan: No, a parliamentary committee is not a court. However, one often hears a
66968-9-4014
Supply-National Revenue reference to the high court of parliament, so one is left to draw one's own conclusions.


Lionel Chevrier: Do the rules of evidence apply in a committee?


George Clyde Nowlan: The rules of evidence may not apply, but when the hon. member speaks about something being proven, and when he says that things are proven, it leaves the impression that he is referring to evidence.


John Whitney Pickersgill: I know the minister does not want to misrepresent what I said, but I did not use the word "prove" anywhere.


George Clyde Nowlan: The hon. member did not use the word, but he made references to this evidence and one draws an inference from that. Apparently there is some suggestion of political interference and some suggestion that political pressure was brought to bear in connection with this program. Well, I have heard this government described in various rough terms by hon. members on the other side of the house, as having failed in this and failed in that and failed in the other thing. I believe most of these charges are not correct. However, I have never heard any description of this government or of any member of the government that was so uncomplimentary as to suggest that if there was any desire or any intention to use political pressure to cancel this program, it would have been done in such a way and at such a time. Certainly no politician with a scintilla or a modicum of intelligence would have done it in that way.
I think that is the best answer. How could anyone suggest that if political pressures were to be used to cancel this program, they would be used when this house was going to close within a week or two, after sitting months and months, and the program having gone on for two years? To do it in such a fashion would be utter nonsense. Just how silly can they get over there? They even have to laugh themselves.
Of course when they make such suggestions they know how little foundation there can be. The program may have been cancelled ineptly and without proper discussion. One can admit in a moment that is a matter for management as to why it was done or how it was done, and in that way management must answer for it. However, I can give assurance, as I have done before in the house and in the committee, that the suggestion that it was done by political pressure, clandestine or otherwise, influence or pressure, is sheer nonsense in every way, shape and form.
The hon. member for Laurier, who usually is very logical and makes able and convincing speeches in this house, I thought was
6330	HOUSE OF
Supply-National Revenue driven to rather unfair limits when he suggested there were questions which should be put and answered. I suggest there may be theoretical questions about everything under the sun. If everyone goes around trying to make up questions and give answers about everything from creation to the hereafter, they will be rather busy indeed.
The hon. member referred to some question about the role of the Prime Minister and the role of someone else. I have been actively associated, as Minister of National Revenue, with this corporation from the day we took office on June 21, 1957. I have been the only one who has been associated with it in any way, shape or form. For anyone to suggest that the Prime Minister, directly or indirectly, interfered with this corporation through me or through anyone else is absolutely untrue and unwarranted; there can be no question on that score whatever.
Much has been said about the budget and the fact that the poor C.B.C. is defenceless because the government, through parliament, prescribes the moneys which the corporation is to receive. Well, what was the situation when we came into office? Where was this formula about which we hear so much now? I will tell you what the situation was. When we came into office the government of the day, represented by some hon. members who have been speaking this afternoon, had only provided the C.B.C. with enough money to keep it operating until October. In order to be fair I should say there was a royal commission and they were awaiting the royal commission report, but the royal commission report was not going to provide the money, per se. You had to go to parliament.
The first thing I had to do, as Minister of National Revenue, was to get a supplementary estimate through this house to keep the corporation from closing down. Something was said, and I think there is a misunderstanding about this-with all due respect I think the hon. member for Port Arthur has a misunderstanding of it because some of his questions would imply this- about my responsibility with respect to money. Not only am I the minister who reports to parliament or who is responsible for reporting to parliament for the C.B.C., but under the act I also have to recommend to cabinet every expenditure which has to come before the cabinet. What was the situation when I took office? I found that the minister responsible for the C.B.C. had to recommend to cabinet every expenditure over $25,000.


John Whitney Pickersgill: Is the minister not just referring to capital expenditures?


George Clyde Nowlan: No; for any expenditure over $25,000, under the C.B.C. act the corporation had to get the authorization of the governor in council. Of course this would imply, as I am sure the hon. member will agree, a recommendation by the minister, whoever he might be, to council to get that authorization through. When we drafted this new bill which has been criticized-I am certainly not suggesting for one minute it is a perfect piece of legislation; I said that last year and I say it again-what we did do was to raise that ceiling from $25,000 to $100,000, and we eliminated programming entirely from that consideration.
Under the old act and under the former government, everything over $25,000 for programming had to be approved by the governor in council. Under the present act expenditures over $100,000 have to be approved by the governor in council, but programming is not included. I happen to know of one expenditure for programming that is going to cost $1 million which does not have to have my recommendation or my approval in any way, shape or form. This is a long term program, running over three or four years, but I happen to know about it.
I do not believe there is any basis whatever for this charge that the corporation is under the control of the Minister of Finance or the Minister of National Revenue and is weakened in any way because parliament has to vote the money. There is such a difference in the last four or five years. The cocoon has blossomed forth. The days are over when the C.B.C. budget was $4 million or $5 million. Radio was a constant factor, and expansion had ceased. The experimental era was pretty well over. You could plan a budget for a certain period.
We have blossomed forth from a budget of $7 million or $10 million to $60 million in a period of four or five years. What formula could you adopt to cover an expanding situation such as that, I should like to know?
What was the situation when my hon. friends opposite were in power? They had a formula at one time. At one time they had licence fees plus advertising revenues and you had to live within that formula or you had to fire someone. At one time they had a budget and licence fees, and it was not sufficient to run the corporation. Gradually they outgrew the licence fee; there were difficulties of collecting it, and they got a fixed parliamentary grant of $7,500,000 a year for the last three years, I think it was.
Then there was the excise tax. They had no reasonable formula whatsoever; I refer to hon. members on the other side of the house. It is true that the excise tax provided a new

source of income, but when the corporation needed less money, compared at least with later years, the amount that came to them was larger because everybody was buying a television set and therefore the excise tax was larger and was far beyond their needs. And when the corporation needed money most less was coming in because people had bought their television sets.
To say they had a formula is a play on words. What our predecessors in office were doing-and what I suggest they would be doing today, or what they were doing up until the day we took over-was voting money by parliament. They had a parliamentary grant. They had the excise tax. They also voted money for the last year's grant and for the last two years we voted money for a deficit just as we are doing now. The only difference is that the deficit is bigger now than it was then.


John Whitney Pickersgill: Will the minister permit a question at this point?


George Clyde Nowlan: Yes.


John Whitney Pickersgill: Is that not precisely the reason that was given here in this house by the Prime Minister or the Minister of Finance for the appointment of a royal commission, namely that we believed this was a bad system and we wanted a royal commission to recommend a better one?


George Clyde Nowlan: I am not prepared to answer that question; I may say quite frankly that I have not read Hansard. I have not any doubt that the hon. member is giving his recollection and that he probably is correct.


John Whitney Pickersgill: It is a fact.


George Clyde Nowlan: I am trying to suggest only that there is no difference in our procedure in this matter today from the procedure carried on by the hon. members opposite. Maybe we are low on this; maybe there should be more. But I do suggest that in this expensive area you cannot adopt a formula which will be satisfactory at this time. Theoretically it is fine. When the situation stabilizes I think a formula should be and could be found. But I say that in my opinion and that of my colleagues

because this matter was discussed; the Fowler commission undoubtedly recommended a formula-we did not believe and I do not believe that it is a practical suggestion. Therefore we have not adopted it. When you are dealing with $50 million, $60 million, and $70 million a year coming from the taxpayers of the country I suggest, Mr. Chairman, that some form of parliamentary control and parliamentary vote is highly desirable as a protection to the C.B.C. itself, because there are bound to be these pressures arise and there
Supply-National Revenue are bound to be demands from people across the country to know how the money is being spent. Even if you had a formula within which they could operate, I doubt that you would find that it could be preserved in our modern parliamentary practice as it is carried on.
As I said, Mr. Chairman, there are many matters to which I should like to refer. I thought the hon. member for Port Arthur was somewhat critical of the board of broadcast governors and the chairman who, I think, was before the committee twice. However, I think there is a misunderstanding in his mind as to the role of the broadcast governors with respect to the C.B.C. The board of broadcast governors never was intended to have any control over the C.B.C. with regard to programming or anything of that kind. The board of broadcast governors is to lay down general rules and principles for the operation of all radio and television stations in Canada, both public and private. It has no more relationship to the C.B.C., except that it happens to be a government agency and is here in Ottawa, than it would have to a private radio station such as that to which my hon. friend referred in Port Arthur, or to a radio station in Calgary or wherever it may be.
Reports all over this country from persons in the private broadcasting business as well as the public generally are that the board of broadcasting governors have made a remarkable impression, and are doing a remarkably good job and have received commendation from all over the country. I think we are very happy indeed in this government and in this parliament, and that this country is fortunate, in having a man of the type of Dr. Stewart and the other men who are associated with him in the administration and control of licensing of radio and television broadcasting throughout this country. It is because of that fact that the government has announced the relaxation of policy, because I feel confident that we can turn over to the board of broadcast governors the responsibility of deciding where and when and who shall be getting these television licences and know that the very best decision that can be made by human beings subject to human error will be made.
My friend the hon. member for Laurier referred to a certain program. I thought there was a slight lack of logic there. We are accused of political influence or clandestine political influence in connection with the program "Preview Commentary". Yet apparently he was suggesting there should be some overt political interference in order to

Supply-National Revenue get a certain program-I did not catch the name of it-which he wanted restored to the French network.


Lionel Chevrier: I rise on a point of order. I do not want to interrupt the minister, but I am sure he does not want to misrepresent what I said. I thought I made it quite clear, both in the remarks I made in English as well as those I made in French, that if this program "Point de Mire" was withdrawn because of political intereference it should be restored.


George Clyde Nowlan: Frankly I may say I had
never heard of it being withdrawn until the hon. member raised the matter this morning.


Lionel Chevrier: It is withdrawn.


George Clyde Nowlan: I can tell you without any hesitation whatsoever, because I have been so advised by the officials, that the decision to withdraw that program was taken many months ago, and that it was done by the corporation without any suggestion of political interference whatsoever; and the program is not going to be restored in the near future. It is a program that some day may be brought back, but that is a decision of management and the decision will be made purely by them. As I say, frankly I did not know anything about it until I heard the matter raised here this morning.
There are many other matters to which one could refer, but I think I have taken up enough time of the committee at this time. As I said earlier, the C.B.C. has had a very tough season. It has been open season on the C.B.C. Everyone has taken a pot shot at it on the wing or in the bush. Apparently every newspaper felt free to do so, as is its right, as did many individuals. I sometimes wonder whether the advertising dollar and the division of it may not influence to some extent the not entirely friendly criticism which sometimes comes from the press. After all, their share of the advertising dollar will be smaller because as additional stations are licensed there will be greater competition. But as I said at the beginning and say again, I want to pay my tribute to the men and women of the C.B.C. who through very difficult days for the most part-with some exceptions-have been loyal to the corporation and have done a remarkably good job. I emphasize again loyalty to the corporation, because this corporation must exist as a corporation and those who are associated with it must have pride in it and show their loyalty to it. I am sure of that being done.
It has been a most unfortunate occurrence that Mr. Ouimet has had a long and serious illness, but we are all glad to hear that-at

least according to the present advice of his doctors-he will soon be able to return to his office. In fact he intends to return to his office some time in August. Mr. Bushnell wore himself out in the interests of this corporation and worked harder for it than any other man I know. After a short rest I hope he will come back. I am confident that this corporation will continue to make in future the contribution to Canada which it has made in the past.
Someone has referred critically to the committee because in its report it referred to matters of administration. I think it was the hon. member for Bonavista-Twillingate. Although I am not in a position to judge, I do know that most editorial comment in Canada-I said editorial comment; I am not quite sure whether it was biased-agreed with the criticism of the administrative weaknesses in the C.B.C.


John Whitney Pickersgill: Would the minister permit me to say that I said there was no evidence produced before the committee. I direct his attention to the word "evidence".


George Clyde Nowlan: Well, whatever the administrative weaknesses are, I am glad to see that the directors and the executive committee have taken cognizance of them, and I hope that whoever is responsible for piloting these estimates through the committee a year from now will find that next year has been a more stable year than the past year and that these difficulties have been resolved.


Lester Bowles Pearson: May I express the hope that a year from now the minister will still be piloting these estimates, through the commons. However, in order not to have any misunderstanding about the position, a misunderstanding which might be left in view of what the minister has said, may I make it quite clear that when we support a formula for income for the C.B.C. we do not mean a formula which would prejudice parliamentary control of expenditure in any way. We mean by a formula the kind of thing which was recommended by the report of the Fowler commission, which was set up by the previous government and which was the reason no action was taken earlier; a commission which recommended three types of formulae to deal with the changing situation in broadcasting.


Mr. Carter:: 
George Clyde Nowlan: I will be very glad to draw that matter to the attention of the corporation. I am afraid I hafe not here the names of the personnel of the religious council to which the hon. member referred. There are one or two officers in the programming department who, in consultation with the the religious council, lay down religious programming.


Douglas Mason Fisher: I wonder if the minister has any information from his officials about the cancellation of a drama from Winnipeg dealing with a political topic, which program has been either deferred or cancelled because of its nature?


George Clyde Nowlan: I heard a rumour to that effect last night. I have checked with my officials, and they know nothing about it.


Douglas Mason Fisher: My second question, Mr. Chairman, is this. Can the minister tell us whether he is going to continue to try to get himself relieved of this particular part of his responsibilities?


George Clyde Nowlan: That depends. If pressures of work keep on increasing in the Department of National Revenue as well as this department, I may just have to be relieved of something because I cannot carry it.


Douglas Mason Fisher: If the minister does push that in this way he might be able, by following the proceedings in the House of Commons committee on broadcasting, to discover that there were one or two members of his party who seemed to have a real national conception as to what the C.B.C. has to do, and those members might very well be worth recommending to take over this chore that the minister wants to get rid of.


George Clyde Nowlan: I can tell the hon. member that out of the 211 Conservative members of the House of Commons at least 200 would have the same idea of the service of the Canadian Broadcasting Corporation that he
Supply-National Revenue has, and the hon. member has no monopoly of affection for the C.B.C., or of desire to serve.


[Stage Direction]
Item agreed to.
44. Grant for the capital requirements, including the replacement of existing capital assets, of the radio and television services, $9,197,000.
John Whitney Pickersgill: I would like to ask the minister if the corporation has given consideration at any time during the present calendar year to the acquisition of a television studio in Montreal, by means of an arrangement to have it built for them and leased to them, and if he could give some details about it?


George Clyde Nowlan: I have not the details here, Mr. Chairman. The corporation was apparently giving consideration to the construction or acquisition of a building in Montreal to which I referred before the committee the other day. This matter came before me in the regular way as the minister who had to sign the recommendation because it involved an expenditure of over $100,000. I questioned that expenditure, as is now the policy-that was the first time I did so, because apparently I had overlooked it-and I said that I was not recommending any more expenditures unless they were approved by the board of directors. It does not necessarily follow that if I recommended it to the board they would approve it, though I should hope they would. I intended to ask about that matter yesterday, but I forgot to bring the papers down with me. The matter was referred to Mr. Dunsmore, the chairman of the finance committee of the board, but to date I have not heard any further.


John Whitney Pickersgill: Might I ask the minister if it is the opinion of the corporation that such a building for a television studio is required in Montreal?


George Clyde Nowlan: I know the board has been giving consideration to it and there have been discussions with management and the directors, but I am not sure what decision has been arrived at.


John Whitney Pickersgill: Has the minister been advised that there was a definite letter of intent signed by the president of the corporation to a certain corporation in Montreal authorizing them to go ahead with this project subject to approval by the governor in council?


George Clyde Nowlan: I was advised, or rather I read that in a letter which I received from a member of the House of Commons who pointed it out to me. I have not been advised in any other way, although I inquired a



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[Stage Direction]
Supply-National Revenue moment ago and was told that such a letter of intent was sent; but it was stated that it would, of course, be subject to the approval of the governor in council.
John Whitney Pickersgill: Is the minister aware
whether it is the custom for letters of that sort to be sent and to be acted upon on other occasions?


George Clyde Nowlan: I understand it was the standard wording, the letter which was sent out.


John Whitney Pickersgill: Does the minister think it is a very wise practice, in view of the requirement that the governor in council must approve, for the president of the corporation to make commitments which would to the average businessman, I think, create the impression that he could go ahead? Otherwise it would not appear to have much point at all.


George Clyde Nowlan: I do not know whether my opinion is very important on this matter, Mr. Chairman. Normally I think he would not send out such a letter unless he were assured it would at least be approved by the board of directors.


John Whitney Pickersgill: In view of the fact that such a letter was sent and, as I am informed, very considerable commitments were made on that account, would the minister feel or would he not feel that some account should be taken of those circumstances if for example two propositions were before the board which were otherwise of equal or virtually equal acceptability?


George Clyde Nowlan: I would hope that the board would give it very careful consideration.


John Whitney Pickersgill: Quite. Would the minister, the circumstances having been drawn to his attention-I prefer not to mention the name unless the minister wants me to-give an undertaking that if a recommendation to erect a building for television studios comes before him he will look into those circumstances I have mentioned? Will the minister give us that assurance.


George Clyde Nowlan: Yes, Mr. Chairman.


Mr. Hellyer:: Could the minister tell the committee whether a site has been chosen for the new C.B.C. central office in Toronto, and what plans have been made for constructing a new broadcasting centre there?


George Clyde Nowlan: No decision has been made as to the location. Officers of the corporation have been looking over properties within the last two weeks. The matter is now under close study to the end that a decision may be reached.


Douglas Mason Fisher: In the committee we heard evidence from the director of engineering to the effect that there will be nine television relay stations or extensions or satellites and some 20 low power relay stations constructed. The request I wish to make to the minister, to pass on to his officials, is that information of this kind be distributed as soon as possible. In many parts of the country it is important that this information be made available as soon as possible in terms of private arrangements that may be under consideration. I would like to ask the minister if he can ascertain from the officials now before him what will be the earliest we can hope that this information will become public knowledge.


George Clyde Nowlan: I do*not know, Mr. Chairman. I am not at all certain that some of this information should become public knowledge. These are matters for study and consideration. The corporation would have to give careful consideration to these questions.


Douglas Mason Fisher: I suggest it should become public knowledge, because a number of communities in this country have to consider whether or not to make what in many cases are inordinate expenditures in order to prepare for these radio or television facilities. If the C.B.C. has a five-year program, within the limits of population change it should be able to spell out these projected television stations and low power relay stations and state where they will be located. I understood from the reports we had that this information would be available at some time, and I should like to know at what time.


George Clyde Nowlan: I have no idea, Mr. Chairman.


John Whitney Pickersgill: Mr. Chairman, I hope the minister is not falling into the egregious error that the Minister of Northern Affairs and National Resources did the other day, and suggesting that information about these extensions should be kept secret.


George Clyde Nowlan: Oh, no, Mr. Chairman, I did not mean that. I intended to suggest that until decisions are made it would be unwise to have this information become public knowledge. I understand that the matter is under study. Many factors enter into it in terms of population and other things, and only a limited number can be built in any one year. I meant to suggest that until a decision had been made it would be unwise to give publicity to these things. I understand that a decision will be arrived at within the next five or six months.


John Whitney Pickersgill: Mr. Chairman, 1 trust the minister will not consider it necessary to telephone the premier of Ontario to get permission to make an announcement.


[Stage Direction]
Item agreed to.

[Stage Direction]
The Senate-
The Speaker of the [DOT] Senate-
174.	Allowance in lieu of residence, $3,000.
175.	General administration, $722,090.
Lionel Chevrier: Mr. Chairman, as the committee know there are a number of items which are of particular interest to those of us who sit on this side of the chamber. While I know it has been the custom to allow most of these items to go through unchallenged-and I would reassure Mr. Speaker at once that it is not my intention to oppose any of them-there is a matter about which we are somewhat concerned on this side. It has to do with the secretaries normally assigned to some of us during the non-sessional period. Before I launch into any discussion of our position with respect to that, I wonder if Mr. Speaker would be so good as to tell the committee what he has in mind in connection with that situation as far as we are concerned.


Douglas Mason Fisher: Before the Speaker does so I wonder if he could give us a report on the results of the investigation he had carried out by the officials of the civil service commission on the more general topic of secretaries and the facilities offered to members.


Mr. Speaker:: Perhaps I could make both those observations together. First may I say the pool system of secretarial assistance for members of the House of Commons has gradually altered in character over the years. We have come to a system whereby all the secretaries are now assigned to the service of individual members. That is a basic change in the former method of operation.
As hon. members will see, the vote for secretarial assistants provides for five secretaries who are called permanent and who are actually civil service appointees. It provides for 33 full time and for 140 sessional employees. The complement at present is in excess of that number both in so-called full time and in sessional secretaries.
In an effort to meet the requirements of the members for more and better secretarial services we went beyond the estimate and have had authorization for the sessional part of that increase. We have today a total of 192 secretaries of all three categories serving
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members of the house. Of this number approximately 50 were continued in service during the last recess. That was in excess of the authorized vote. It was warranted perhaps by the fact that the last session continued on into September. There was a shorter interval for holidays, and additional secretarial staff was taken on during that recess to give the full holidays that were due to the secretarial staff. In any event we went beyond our authorized numbers.
The problem I was faced with as this recess approached was to keep within the vote which hon. members have before them, because it was obviously not proper procedure to have on the staff more than the House of Commons authorizes to be paid.
In consultation with all three parties we agreed on a quota basis for each party based on the number of members to be served, and divided the 33 full time positions among the parties, making allowance for some special cases. The agreement was that there would be 24 for the government side, 9 for the Liberal party and 1 for the C.C.F., plus 2 for the office of the leader of the C.C.F. It was my arrangement with the whips that they were to indicate which of the secretaries on the staff would be required during the recess, having regard to the members they were to serve.
That is the basis on which the problem has been met. It obviously means some changes among people who were previously continuous, and it means also the addition of people to the continuous staff who were not formerly continuous, and an adjustment is being made as best can be done within the limits of the funds available.
This is a continuing problem. As all members know, this session we instituted a study not only of the best secretarial arrangement which could be devised to suit our particular needs in the House of Commons, having regard to the recess and members' requirements during recess, but also of the other office arrangements, and that report has been received and is quite interesting. It points in the direction that I have favoured myself, that is reaching the point where we will have a secretary for every member of the house. But we have not reached that stage yet, nor have we enough accommodation; but that I think is the indicated need at the present time having regard to the responsibilities of members.
I should like to read one paragraph of the recommendation which to me affords a reasonable solution in the future of this question with which all members have been concerned. This is the report of the survey of the secretarial services and office facilities of the

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house provided by the organization and methods service of the civil service commission. It is dated June 1959, and I am reading from the summary of conclusions on page 37, as follows:
That the plan to provide supervised, small groups of stenographers in offices located close to the members served, and restricted to individual political parties, would be the most effective secretarial system for the House of Commons, and that such a service should include provision for telephone answering, dictation equipment, and allied services.
That confirms the view that many people have expressed that the pool system is antiquated, and that it is desirable now to move to a system for an individual secretarial service close at hand and so arranged that the secretary, when the member is out or when the member is there, can be in a local pool, so to speak, and have facilities for answering the telephone and giving that service as well as acting as a secretary. I think that generally covers the point.


Lionel Chevrier: Mr. Chairman, I think the committee will be grateful to His Honour the Speaker for the statement he has just given and also for the position as outlined in the survey concerning future secretarial assistance for members of the House of Commons.
There are one or two observations which come to my mind. The first is this. I wonder whether the Speaker would not give consideration to letting the members of the house see the survey from which he has read. I do not mean that it should be a part of the record of Hansard, but I think all hon. members would be interested in getting a copy of the survey. Perhaps it could be mimeographed and circulated, if His Honour thinks that would be proper.
Now let me deal with the other matter to which His Honour referred, namely the meeting which was held by the various groups in order to arrive at a decision that would apply during the non-sessional period. I believe that what the Speaker indicated on the whole is the agreement that was arrived at, but there is one thing as it affects this side of the house which I would like to bring to his attention, and I wonder whether he would give it a little more active consideration. It is this. Following the election of 1957, there was an agreement that the eight members of the former government were entitled, or would be entitled, to a secretary, whom they would take from the offices which they then vacated, the intention being that the secretaries who had been employed in the various departments of the former ministers should be assigned to them in the opposition with a salary to be fixed by the house.

That was confirmed by agreement. It was contained in correspondence between my hon. friend the member for Bonavista-Twillingate and the Prime Minister. That arrangement has been carried out with but one exception. While I am not free to mention names, and it would be my last intention so to do, I think His Honour knows what I have in mind. There is that unfortunate position in so far as we on this side of the house are concerned. I wonder whether the Speaker would be good enough to take another look at that situation, because we feel that here is a person who left permanent employment at a fixed salary and came over with a former privy councillor to the opposition side of the house. Now that person is going to be without employment during the recess unless the Speaker is good enough to see that she is assigned to someone during the recess.
Having said that, there are just one or two other matters that I would ask the Speaker to give consideration to, and they are these. I know-I am sure-that during the course of the recess it is impossible for the Speaker and those responsible with him for this work to find employment for all the secretaries and stenographers who were taken on during the sessional period, but there are some cases which frankly are pretty serious and are of an emergency nature. I have before me here a number of such cases. I would not like to do other than mention them in a very general way because otherwise they could be identified, and I am sure that is the last thing the committee and the Speaker would want me to do in the circumstances. But I would like to bring to his attention the fact that I know of several cases where these stenographers have reached an age where it is not possible for them to find employment during the recess.
Furthermore, I know that all these cases that have been brought to my attention but one are in this position; that if they are not given employment during the recess period they will be in a pitiful position in so far as, first, their children are concerned; second, their mothers are concerned; and, third, their personal livelihood. Having said that, I know I have said enough so that the Speaker realizes what is in my mind.
Knowing, too, the disposition that the Speaker has made in cases such as these, the very sympathetic manner in which he has approached this whole problem from the beginning, I am sure he will want to give it careful consideration. I ask him on behalf of those who have received representations from this side to take another look at this case of the individual who thought she would have permanent employment when she left a

government department. Then there are several cases, which unfortunately I cannot identify, of stenographers who will suffer seriously if they are left without employment, particularly when there is no notice given to them that their services are about to end.
I understand from the Speaker that there is a 30-day notice in most cases. I know of one case where there has been no such notice, and where it has been indicated that she will have to vacate her position the moment the session is prorogued.
I would draw this final point to the attention of the Speaker. In the United States congress, with which I am sure he is as familiar as most of us, if not more so, the situation is not at all similar to the one here. While I know there are difficulties, it seems to me that no one should be allowed to suffer if that can be avoided. I leave the matter in the hands of the Speaker, content and satisfied that he will want to give it his most careful and sympathetic consideration.


George James McIlraith: There is one very brief comment I should like to make arising out of the remarks of the Speaker. I will relieve his mind at once by saying that it is not by way of criticism at all but merely to make a suggestion which I hope will be helpful in dealing with what of necessity is a difficult and delicate problem which must have caused him real concern. It has to do with his statement as to the apportionment of the secretaries among the parties.
There is within that problem a regional problem, and a mere apportionment in the way he described to the committee is capable of being somewhat misleading. Bearing in mind the regional problem that exists in the immediate Ottawa area, and bearing in mind the proportion of members of one party or another within that region at any given time, it could put the balance out of line unless that factor is recognized when arriving at a figure as among the parties. If hon. members will consider the regional representation over the last year, when it has been four to one, they will see how that can distort the results. I put this forward with the intention of it being a helpful suggestion.


Herbert Wilfred Herridge: Mr. Chairman, on behalf of my colleagues I want to express my appreciation for the consideration the Speaker has given to our representations, complaints and requests for adjustments throughout this session. While naturally the Speaker could not always comply with our many requests or correct all our complaints we appreciate
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everything he has done to try to make our secretarial and staff work as efficient as possible.
I might say before proceeding that I want to support the remarks of the hon. member for Laurier with respect to those members of the staff who find themselves in difficulties at the end of the session as far as employment is concerned, largely on account of age and so on. I listened with interest to the report the Speaker gave with respect to his survey. I was very interested to hear him speak of working toward the objective of each member having his or her own secretary. I think that is very necessary. Indeed, I look forward to the time when each member will have his or her own office and secretary. In my opinion that is the only way we will have efficient functioning of the secretarial activities in this building. I can readily see from the Speaker's report on the survey and his remarks that he has given serious consideration to improving the efficiency of the secretarial work and staff as far as the House of Commons is concerned.
Before I sit down I must express the appreciation of my colleagues for the devoted service of the staff in this building, the protective staff, the public works staff, the secretarial staff and the cleaning staff. I might say that I often meet the ladies of the cleaning staff when I get here about 7.30 in the morning. The hon. member for Ottawa West is accusing me of something of which I could not possibly be guilty. I hear the various complaints of these ladies, and in that respect I suggest that some consideration might be given to changing their hour of arrival, because apparently they have to arrive half an hour or an hour earlier than is necessary to complete their work in the building before the members arrive. I must not forget the nurse who has treated me very satisfactorily on several occasions during the session for minor ailments, and also some of my colleagues as well.
Before leaving that point, I do want to say that we appreciate the work of the Hansard staff, which is particularly trying under these circumstances and has been during the last month. They are kept here for long hours at a type of work that requires concentration and application, which is very tiring indeed. I think we should recognize the good work they do. I remember being told two or three years ago that the Hansard amanuenses do not get any overtime, and that on one occasion the house prorogued at noon on Saturday and they were paid until noon on Saturday, after working until 11 and 12 o'clock several nights prior to prorogation. I hope the Speaker will be more generous in that respect should such a situation arise this session.

S upp ly-Legis lation
Before concluding I do want to suggest that we have to give some consideration to planning our sessions to better advantage. The way our sessions are handled at the present time is most inconvenient for the majority of the members. There may be a few gentlemen of the legal profession who find it more satisfactory, but I do not see why a dozen or so of these gentlemen should influence the handling of the sessions of the house. There are a lot of farmers here and many other people who have to get out and earn their living. I suggest that we should give some consideration to having our sessions commence on October 15, continue until December 15 and adjourn until January 15 with the aim of proroguing around June 15. In that way we could do our work much more efficiently, plan it to better advantage, and leave the summer months for visiting our constituents and things of that sort.
I have one more thought I wish to express before I sit down. We all know the anxiety to conclude this session today. That is one reason I am denying myself the opportunity to speak on a number of things on which I should like to have spoken, as other members are also doing. But I think we could do a great deal toward a better ending for our session if the whips of all parties would get together a month before the end of the session and commence doing then what we have been doing in the last three days. I think that would make for a much more satisfactory conclusion. We would then all know when we would likely be able to leave, and we could make our reservations.


John Whitney Pickersgill: Mr. Chairman, before the Speaker replies I should like to say a word about one precise point made by the hon. member for Laurier. As he indicated I, at Mr. St. Laurent's direction, wrote a letter about this situation to the Prime Minister on the last day he was leader of the opposition. There was one aspect of the letter that may not have been as explicit as it should have been, but that was followed by certain conversations with the Speaker's predecessor and with an official designated by the Prime Minister to deal with the matter.
There was a very clear understanding that the eight secretaries who came here would be not permanent but on the continuing staff, and that treasury board would increase the appropriation temporarily for that purpose and let it run down again as others retired. It would be, I think, very embarrassing-I do not want to use any extravagant language -if any of these eight persons, so long as they give satisfactory service, of course, was

prejudiced because they could have had positions in the public service of a continuing nature.


Mr. Speaker:: I take it this is probably the only general discussion there will be. 1 should like to thank hon. members, not only for the kind things they have said, but for the constructive suggestions that they have made. It would be of interest to discuss some of these problems at greater length, but this is not the stage of the session to do so. I am glad hon. members take the opportunity of coming to me with these administrative problems during the session, and I hope most of them can be settled and dealt with in that way. We, unfortunately, have to work within the limits of the estimates which are before us. I appreciate particularly the problems which have been mentioned of the sessional and continuous stenographic staff. I have been personally much concerned about them and I am concerned about them now. I believe hon. members will find the arrangements which are being made satisfactory.
It was, perhaps, an excess of amiability which got us into trouble last year in making the arrangements to which the hon. member has referred for the service of former ministers, of local members, and in meeting the reasonable requirements of the members for assistance during the recess. In this way we got our recess staff 12 above the number which was provided for in the vote. I am hopeful that this problem is a temporary one. The report which has been made, I think, points the way to improvement. I shall be glad to have this report circulated. I am indebted to all hon. members who assisted in the investigation and who wrote letters giving their views. They point clearly to one course, an individual office and an individual stenographer for every member of the house. So far as I am concerned, that is the direction in which we should go and the direction in which I am going in so far as I have to do with it. As I say, we have at this moment to work within the estimates before us and I shall do the best I can within those limits to meet the problems which have been pointed out.
I should like to add a word of appreciation to the staff here. We are well served in this house by our temporary and our permanent staff, sometimes under conditions which we find trying ourselves and I am sure must be even more trying for others. If there are other points to be raised, I shall be glad to consider them.


Frank Howard: The comments I have to make would more properly come under items 182 and 183, but I understand this is a sort of

general discussion period, so I shall make them now. Apparently one of the almost universal questions that is asked, especially by visitors who come here not only from Canada but other countries, relates to the young gentlemen who are our page boys. I have wondered about it for some time, as I am sure other members have. I think it might be most enlightening, certainly to some members of the house and to the general public, if Mr. Speaker were able to relate some of the educational facilities for our staff of young gentlemen who are our page boys, so far as their formal education is concerned.
I would suggest one other thing for consideration of His Honour, if I may. I refer to the difference in salary structure between the protective staff and the messenger staff. If one looks at the items listed in the detailed section of the blue book, one sees that the difference in salary structure ranges somewhere in the neighbourhood of $1,000 a year. I would suggest this might be a matter for consideration, the bringing of the salary structure of the messenger staff more closely in line with that of the protective staff. The question of responsibility is not the one on which we should make a comparison. In so far as work is concerned, the moving about of equipment and things of that nature, the messenger staff performs a prime function in connection with the efficient operation of the house. May I suggest that might be one question taken into consideration, to bring the messenger staff salary structure more closely in line with that of the protective service.


Mr. Speaker:: I would just say one word about the page boys. All hon. members know that these young lads who serve us here cannot avoid having their formal education interfered with as a result of the service which they give here for remuneration. I am hopeful that they learn other things here which will stand them in good stead in the future. I have a complete report on our page staff for the present session and I find that all of them are reasonably well advanced in their school year, having regard to their school age, so we are assured to some extent that we are not robbing them of their education. I am afraid that these morning sittings starting in June will have caused some setbacks to some of the boys, but I understand these boys do not intend to continue school in any event.


[Stage Direction]
Item agreed to.
The Deputy Chairman:: This completes the estimates of legislation, and we shall now take up health and welfare.
Supply-Health and Welfare
NATIONAL HEALTH AND WELFARE 238. Departmental administration, $1,601,785.


Mr. Monieith (Perth):: Mr. Chairman, may I start out by suggesting that it would be very kind of opposition members if they were to treat me as kindly as they did Mr. Speaker. Of course, that is probably a little too much to expect. I have a statement, Mr. Chairman, and if hon. members so desire I would be glad to make it on the opening item of the department. I might point out that actually I propose to make a further statement on civil defence when we come to that item. I am in the hands of the committee. If, due to the special situation that seems to prevail today, hon. members do not necessarily wish me to make any remarks on the opening item of this department, I would be pleased to forgo them.


Paul Joseph James Martin: I believe the minister has not got a very long statement, and this is a rather important department.


Jay Waldo Monteith: You should know.


Paul Joseph James Martin: As the minister says, I should know. I think the expenditures involved are so large and so many important matters are involved that some statement should be made.


Jay Waldo Monteith: As hon. members will note from the blue book, we are budgeting for an expenditure of $1,393,340,528 for the 12-month period ending March 31, 1960. An additional amount of $7,220,817 is provided for civil defence purposes.
Of our over-all expected outlay of roughly $1.4 billion, 94 per cent covers statutory items including $577.6 million to be expended from the old age security fund. Only 6 per cent or $92 million represents items to be voted by parliament.
While our total estimates embody an increase of over $220 million as compared with the past fiscal year, non-statutory items show a decrease for the first time in eight years. Amounting to $1.3 million, this decrease relates chiefly to a reduction in estimated expenditures under the national health grants. I want to emphasize that there has been no reduction-nor is any contemplated-in the funds available to the provinces through the grants. The lower estimate simply represents an appraisal of actual provincial needs during the fiscal year.
The largest increase in expenditures arises from a new statutory item in our estimates, that is, federal payments under the Hospital Insurance and Diagnostic Services Act. Running to $160 million, this item represents 72.7 per cent of the total increase in statutory outlays. Other increases in statutory items
6340	HOUSE OF
Supply-Health and Welfare include: $25 million for family allowances, related primarily to population growth; $22,600,000 for old age security pensions, reflecting the growing number of persons 70 years of age and over; $2,700,000, $2,200,000 and $300,000 for old age assistance, disabled persons allowances and blind persons allowances respectively, reflecting the anticipated increase in persons eligible for benefits under these programs; $8,960,000 for unemployment assistance, related largely to the effects of the removal of the threshold governing federal sharing under this program.
In addition to giving this general outline of our proposed expenditures for the present fiscal year, I might touch on a number of aspects of the department's operations which strike me as particularly significant.
On the health side, there is the hospital insurance plan which has now completed its first full year of operation in five provinces. I know that hon. members will be pleased to learn that this important and complex project is working out extremely well. While certain problems have been encountered, the over-all picture has been one of smooth and orderly development. In fact, as I told the recent biennial meeting of the Canadian Hospital Association, I think it is fair to say that the program has come through its immediate post-natal period with flying colours.
To my mind, what has been achieved in this matter reflects great credit on Canada's health team. In particular I would mention the excellent co-operation that has been extended to us at the federal level by provincial ministers and their officials. This has been a key element in the successful launching of what is probably the most ambitious and far-reaching health measure ever undertaken in Canada.
At the moment, the hospital insurance program covers nearly 12 million Canadians in eight provinces, New Brunswick's plan having commenced on July 1. As I have already announced to the house, we are also ready to sign an agreement with Prince Edward Island but, at its request, this has been put off until July 20. The plan itself is scheduled to go into effect on October 1. In addition, preparations are going ahead in the Yukon and Northwest Territories, and both hope to have plans under way early in 1960.
With respect to costs, I am encouraged by the fact that these have been running about as expected. While final calculations of federal payments for 1958-59 have yet to be made, the pattern of our monthly advances to the provinces has been most favourable, corresponding in large degree to prior estimates. As of March 31, federal advances totalled
IMr. Monteith (Perth).]

nearly $55 million as against the estimated figure of $60 million for 1958-59 which appears in the blue book. Since these advances were based on preliminary returns from the provinces, it is likely that final payments will be even closer to our forecast.
Continued progress has also been made in another important federal-provincial health measure. Now in its fourth year of operation, the Salk polio vaccine program has provided protection to nearly 7 million Canadians, both children and adults. Among those covered recently are many members of this house, of the other place, and of the parliamentary staff. In this connection, I should like to express a word of thanks to the doctors in the house for their initiative' in setting up and carrying out their own immunization program. My department has, of course, been only too happy to supply the vaccine for this purpose, and I understand that over 900 inoculations have so far been administered.
Turning to the welfare side of the department's operations, the outstanding highlight of the past year was, of course, the completion of the Clark report on "Economic Security for the Aged in the United States and Canada". I am sure all hon. members will agree that it represents a most comprehensive study of the subject. As far as the government is concerned, we consider that Dr. Clark has carried out a very difficult assignment with great distinction, and are gratified at the favourable reception which has been accorded the report throughout the country. At this stage, I can only say that it is being studied closely by the government.
Another development of note is the entry of the province of Quebec into the unemployment assistance program which I announced to the house earlier this month. Under an agreement signed on July 1, Quebec becomes the tenth province to participate in this important social welfare measure. Unemployment assistance has proved of great value in other parts of the country and the dominion government is naturally pleased that the people of Quebec will now be in a position to share in its benefits.
Since this event occurred subsequent to the preparation and tabling of our estimates for the current fiscal period, it may be expected that federal unemployment assistance payments to all ten provinces-including Quebec -will be somewhat in excess of the $20,960,000 figure shown for 1959-60 in the blue book.
I mentioned earlier that I proposed to make a statement on civil defence when the item comes up for consideration.
In conclusion, Mr. Chairman, I want to express my sincere thanks to the officers and

staff of the department. With the passage of time, I am increasingly mindful of what their skill and dedication to duty mean to our very extensive operations.


Paul Joseph James Martin: Mr. Chairman, the minister concluded his statement by paying a tribute and expressing his gratitude to the officials of the Department of National Health and Welfare. I should like to join him-not that I have any right to do it at the present time except for their collaboration during the period when I was their minister-knowing them as I do, in a tribute to a remarkable group of pubic servants who have made a great contribution in this department both on the health and on the welfare side, and as well as in civil defence.
The minister has suggested that as we were kind to the Speaker who preceded him in the discussion of the latter's estimates-I refer to the discussion of the Speaker's estimates- that he would hope that he would get similar treatment. I can assure the minister that there is no necessary contradiction between kindness and constructive criticism. He can be assured that he will be treated in any event with great fairness.
I want to say to the minister something which I would have said last year if I had been here for the discussion of the estimates of this department, and that is that, as the former minister, I appreciated and I continue to greatly appreciate what I understand from all sides is the generous and fair way in which the minister has treated members of the department, particularly those in my own office.
The minister proposes to make a statement when we come to the civil defence item, and of course I cannot say anything about that at this time except generally to comment on one or two matters which I believe should receive attention. As the minister has pointed out, most of the expenditures in the Department of National Health and Welfare are of an uncontrollable type; that is to say, they are either statutory or they involve services in connection with which there could be no governmental or ministerial interference, certainly in the latter case without causing the greatest hardship and dislocation. In respect of the non-statutory items totalling something in the neighbourhood, I think the minister said, of $92 million, the decrease which he called our attention to arises out of a decrease of around $1 million in the national health grants. This decrease in turn was because the provinces, either collectively or individually, did not require certain assistance which theoretically is open to them under the national health grants vote. The minister has given us the assurance that this
Supply-Health and Welfare did not in any way mean an impairment of the assistance parliament has authorized the federal government to give the provinces to supplement their efforts to maintain the excellent health services which prevail in all of our provinces in varying degrees.
I would be very interested when we come to the particular item to learn exactly in what grant the decrease has taken place. Likewise when we come to that item the minister could possibly give us a more detailed picture of the operation of the health grants which, as he knows, were established, among other reasons, for the purpose of laying down a very necessary foundation for the system of hospital insurance that has now been so successfully undertaken in this country. I am sure the minister with two years of experience now will agree that these grants have greatly assisted the provinces in carrying out work in the field of public health, work that could not fully have been discharged by them but for the assistance that was given to them by the government of the day some 11 or 12 years ago. These grants, which as I say were not necessarily conditional on the establishment of hospital insurance, were a necessary prerequisite to the setting up on a basis of co-operation with the provinces a system of hospital insurance that has now been undertaken so successfully in Canada.
The minister mentioned the Salk polio vaccine of which some 7 million Canadians have now been recipients and who are enjoying the advantage of the discovery of Dr. Salk. If it had not been for the national health program, for the moneys which were available at the will of the federal government, this program would certainly not have been as successful in Canada, and many of the provinces would undoubtedly not have been able to take advantage of the arrangements which were made at the time by the Department of National Health and Welfare. The minister has mentioned that the beneficiaries of this Salk vaccine program are not confined to young children, but that adults may benefit as well. I would be interested at some time during the estimates to know exactly to what extent the federal government participates in the administration of the Salk polio vaccine to adults, and whether the financial sharing formula is the same as prevailed two years ago with respect to young children.
The minister has a research grant under the national health program, and that research grant was able to play its part in the development by Dr. Salk himself of the Salk polio vaccine. I was interested the other night when the estimates of the national


the report be prepared as early as possible so that parliament and the public could judge whether or not anything further could be done in this field. Nothing is going to be done this session. I am sure that nothing will be done next session. I have great doubts whether it will be done the following session, but I would not be surprised-and perhaps the minister can give us some assurances on this particular-that on the eve of the next election, realizing how-


Jay Waldo Monteith: Such as hospital insurance in 1957.


Paul Joseph James Martin: The minister says "such as hospital insurance in 1957". Hospital insurance was not a pre-election pledge. My hon. friend now has the documents and he knows that hospital insurance introduced by the former government represented hard work on the part of all concerned, provincial and federal officials, and ministers. It represented a sincere desire; it was not a pre-election pledge, and certainly it was never offered in the way in which this United States program was offered.
I say to the minister, a lot of money was spent in the preparation of the Clark report. If there are any advantages to the United States system, this government has the moral responsibility to take steps at the earliest moment to implement the promise made by the Prime Minister. If he does not, this will be one other promise made to capture the support of the Canadian people, a promise made with all of the vigour and the freshness that attended so many other promises but, like all other promises, it will be a promise unfulfilled.


Murdo William Martin: Mr. Chairman, in view of the spirit of the committee and on such a day as this I am going to make my normally brief comments even briefer than usual today.
I should like first of all to compliment the hon. member who has just taken his seat on two or three matters on which he spoke. I wholeheartedly concur with him in some of these matters and the fact that he has presented his views so clearly today will certainly save me the necessity of repeating them.
Sometimes there is a bit of confusion caused by the two hon. members of the same name. In view of his past distinguished service and of his present very comprehensive criticism of this subject, I might better refer to him as "Doctor" Martin and we can get away from some of the confusion that exists.


Paul Joseph James Martin: Some refer to me as Farmer Martin.


Mr. Harkness:: We all have to have our little joke.


Murdo William Martin: I should like to compliment him first on the way in which he presented his case in regard to the great need in this country for and the justifiable expectations of some sort of pension plan similar to what they have in the United States at the present time. I should like to concur in his remarks along that line. I am sure that many of the Canadian people have looked forward to this. I have had the opportunity of travelling across the country from coast to coast in the last couple of years and in many parts of the country I have met with a very strong wish on the part of Canadians that some action will be taken in this field.
I feel, Mr. Chairman, that it is far too important a field to be left to just prior to the next election. We have had too much of that in the past. For many years health insurance was promised to the people of Canada. I hope this is one practice that the present government will not pick up from the previous one.
I think, Mr. Chairman, I will confine my comments today to a few remarks about the nospital insurance plan. I should like to stress this particular aspect of it. After a wait of 40 years for the implementation of hospital insurance as the first step toward health insurance in this country, the fact that within one year all the provinces but one have adopted hospital insurance after the federal government took the lead is an excellent example of the need for federal leadership in matters of this kind. The hon. member for Essex East referred to that very point, that the results at the end of one year of the plan show that the many fears that were expressed were in fact groundless. I cannot resist the opportunity to point out that that is exactly what members of this party have said for many, many years. These fears have been demonstrated to be groundless in many other parts of the world and I think that the sooner we proceed the sooner we will find that fears with regard to complete health insurance have no more basis in fact than those expressed with regard to hospital insurance.
I think the federal government should also take the lead in co-operation with the provinces to iron out some of the possible difficulties that may arise from time to time in the implementation of the provincial hospital plans. In the government's position as a sort of co-ordinator for all the provinces I think they can be of terrific assistance in advising the provinces as to what problems may come up from time to time. If the federal government takes the lead in this field I think they
Supply-Health and Welfare can be of considerable assistance to the provinces in carrying out their plans. I think this also points up the need of federal leadership because provincial leadership in this field is definitely not enough.
In the last 14 or 15 years we have had an example of a provincial hospital insurance plan which paved the way toward hospital insurance generally. I think it is very significant that many people whom I have met who have had considerable criticism for other aspects of the Saskatchewan government have been practically universal in their agreement that Saskatchewan today has the best hospital insurance plan in the country. They will also agree that through the implementation of the hospital insurance plan the province of Saskatchewan also enjoys the best hospitals on a per capita basis of any province in this country. I think this is a natural thing that will follow the implementation of hospital insurance.
Before the minister's estimates are finished I should like him to give some indication of when we can expect tuberculosis, mental illnesses and so forth to be included under the Hospital Insurance and Diagnostic Services Act. I think he will recall the great number of times that members of the present cabinet have advocated this in the house.
There is one other point I should like to recall to the minister and that is the fact that almost two years have passed since the last increase was made in old age pensions. I think he will also recall that at that time a very definite commitment was made to the old age pensioners that this was merely a temporary matter and that as soon as things got straightened away further consideration was going to be given to this need. I think he will also realize that in these two years the cost of living has crept up considerably and that the need is far greater now than it was when this promise was made to the Canadian people.
In addition, I hope that the department has under consideration the necessary steps to adjust the age limits downward in the face of the situation we have today of more and more people once they reach the age of 50 finding themselves in very difficult circumstances. With the advances in technology, with automation and all the dislocations it causes we have an ever-increasing number of Canadians reaching the age of 60 to 65, being thrown out of employment through no fault of their own and finding it practically impossible to obtain new employment because of their age. One thing that could help this category of people would be the early implementation of a social security plan based on that of the United States because I firmly

Supply-Health and Welfare believe that one of the major reasons why-people in this age group are finding it so difficult to obtain employment is the fact that industrial pension plans throughout the country, all in the hands of various private insurance companies, contain clauses barring people after a certain age. That points out all the more clearly the need for the federal government to take the lead in this field.
In view of the circumstances I think that is all I will deal with today. I should like to add once more that I hope the minister will show the zeal in his department that has been shown by the Minister of Northern Affairs and National Resources and I hope he will show the industry in his department that has been shown by the Minister of Public Works. This is one of the most important fields of activity in the whole country and I hope that the minister and his department will take the necessary lead.


Mr. Regnier:: Mr. Chairman, I should like to congratulate the minister and the government on doing something in connection with civil defence. This is a matter in which I am really interested.


Jay Waldo Monteith: Would the hon. member mind making his remarks on the civil defence item which will come up a little later?


Laurier Arthur Régnier: I now have the floor and I am afraid that if I sit down and give it to someone else I will not have a chance again. In any event I will be very brief.


Jay Waldo Monteith: All right.


Charles Edward Rea: I would advise the hon. member that it was agreed that when we came to item 351 there would be a full discussion of civil defence. Perhaps the hon. member might wish to wait until then?


Laurier Arthur Régnier: Yes.


Mr. McMillan:: Mr. Chairman, I had intended to touch on the effects of lower and marginal radiation doses. A little less than two years ago the minister announced that some research work was being done by the department into the genetic effects of marginal radiation on humans. I should like to hear his report on that today, and also whether he has any results to report as to the detection of strontium 90 in milk and cereals. Apart from the health effects, I think a fallout of strontium 90 in western Canada could have very bad economic effects for our western farmers. I do not intend to say any more on radiation but I should like the minister to make a report after I am finished.
I should like to refer now to a subject which seems to be contentious in different parts of our country, the fluoridation of water.


The salts of fluorine called fluorides are natural constituents of practically all our *water supplies. It is never a matter of whether or not the water contains fluorine, it is always a question of whether or not it contains enough. In early childhood it is necessary to have a sufficient intake of the fluorides to make a good hard dentine formation and the good teeth that should be developed.
There is a difference of opinion amongst members of the medical and dental profession as to the quantity of fluorine required to produce a good, hard enamel. It is generally agreed, however, that drinking water should contain not less than one part per million of fluorine in order to obtain this objective. The water of many of our wells in Canada contains considerably more than one part per million, and often as much as two or three parts per million, while the water in the great lakes system from which many of our population centres obtain their water supply contains very much less than one part per million. The point is that caries of the teeth is very prevalent in children who drink water where their source of water supply is the great lakes system and where the fluorine content is lower.
This was very vividly brought home to me some years ago. In my part of the country there is a graded school in which about one-half of the students come from the country and the other half come from an area that is supplied by the Welland water works, and Welland gets its water from the Welland canal shortly after it leaves lake Erie. It was interesting, in examining the teeth of these children to find that those coming from the area supplied by the Welland water works had an incidence of caries practically 70 per cent greater than those who came from the country in which their drinking water was taken from wells where the supply of fluorine was ample.
Caries of the teeth is serious. It is one of the most common chronic diseases. I think it is probably the most common. It has its economic aspects, namely the cost of filling the teeth, which is never satisfactory, and in addition if the enamel is soft we know that the teeth continue to decay and dentures will be required. Then too, the abscess formations which result from caries of the teeth do start many of the degenerating processes in the body to which man is heir. I have seen many conditions such as heart conditions, high blood pressure and joint conditions resembling rheumatism and peripheral pain largely clear up after the removal of infected teeth. Many of these infected teeth have been carried for years and, no

doubt, add to chronic ill health and the development of chronic conditions in vital organs which tend to shorten life.
Several municipalities in Ontario have fluoridation. I believe Brantford was the first and I am glad to say that my home town was the second. It was started in my home town in 1952 and already the decrease in the incidence of caries of teeth in children has been cut down by 70 per cent. Unfortunately, in Ontario at the present time, if a municipality votes to have the domestic water fluoridated, it is not allowed by the government of Ontario. In those municipalities already adding fluorine to the water, a few citizens just have to apply to the municipal council and the council is then obliged to submit the question to a vote.
Prior to the vote all kinds of subterfuges are used by the anti-fluoridationists. They put up signs, for example, around the town saying that the water supply is not pure, that it contains rat poison and what not. This has quite an effect on different people living in the town, and particularly those catering to the tourist industry.
In my town, for example, we have been through this and I know that it cost the dentists and physicians in the town money to carry on the campaign. The people voted to continue using fluorine in the water, but I think the question can be brought up again next year if enough people apply to the town. One very important thing was said to me at the time of that vote, and that was that the national health minister had never made a pronouncement on fluorine. Practically all our large universities accept fluorine as being very necessary to prevent caries of the teeth. It is highly endorsed by practically all the American public health associations; the American dental association, the American medical association, and their counterparts in Canada.
The world health organization in Geneva highly recommended fluoridation and Canada, among many other countries, accepted the principle of fluoridation. I realize that matters relating to health come directly under the jurisdiction of the provinces, but this is a matter in which I think our Minister of National Health and Welfare should give leadership. On the occasion of the visit of Her Majesty to Ottawa the Prime Minister announced the establishment of a fund of $1 million for research into the diseases of children. With this I agreed, but it occurred to me how much misery and disease in children the government might prevent by merely spreading knowledge of the techniques already known but not publicized.
I have looked over the press very carefully and can find only one reference the minister
Supply-Health and Welfare ever made to fluoridation. This is contained in a letter written to and published by Mr. William R. Fulton, director of civic affairs, Calgary junior chamber of commerce, in the Calgary Herald of September 30, 1957. I have a copy of this letter here, and I will paraphrase it. The minister goes on to say that he thinks fluoridation is an important landmark in the long quest for control of tooth decay; that tooth decay is an incurable disease and the only real hope lies in its prevention; that fluorine in the amount of 1 to 1.2 parts per million parts of water is harmless and will cut down tooth decay by at least 60 per cent. This is an important matter to the health of the people who drink this water. If the minister believes what he wrote in September, 1957, and I think what he wrote is very strong, why has he kept so quiet about it for a whole year and a half? After all, that statement was put in the press by somebody else to whom the minister had written a letter.
I do not think any member of this house would say that health matters should be political, and yet it seems to me that the minister considers it to be so. Premier Frost of Ontario has not taken any stand on fluoridation except to appoint a commission to inquire into it. The department of health in Ottawa is the senior department in Canada, is a member of the world health organization and has all the very latest information available to it from this world-wide organization. I think Canadians have the right to expect direction from the minister of health. As I said, he has made no official announcement on fluorine, and I hope that it is not because this has not suited Premier Frost politically. I do not think the minister should ever be subservient to any provincial premier in so far as the health of the people is concerned, I would certainly appeal to him to make some pronouncement. Certainly, he has a duty to help our children in Canada, particularly our children living near the great lakes who have a very high incidence of caries of the teeth.


Mr. Souiham:: Mr. Chairman, the best asset that this country has is not the gold in the ground nor the wheat in the bins but it is the people who inherit this fair land of ours. If we see to it that they have informed minds and healthy bodies, tempered with a reasonable amount of religious instruction, I do not think we shall have to worry about the destiny of Canada.
I think it was with this thought of a healthy body in mind that prompted the hon. member for Simcoe East together with other hon. members of this house to follow the medical profession to band together in a house health
6348	HOUSE OF
Supply-Health and Welfare league to minister to the needs of the other members of this house and staff. I think we would be very remiss in our duties if we did not record our appreciation to these gentlemen, assisted by the efficient nurse on the house staff, for their untiring and great effort on our behalf. I feel that I am not only expressing my own feelings in this regard but those of all the other hon. members of the house.


Frank Howard: It appears to me that the tendency and effort today is to confine remarks, and to make them brief, something, which is of course easy for me to do and to deal on the first item of particular estimates. While some comments I may have to make will relate to specific items I hope that I may be able to get them in on this first item and that we can rattle through the rest in a sort of machine gun fashion as has been the practice today anyway.
Following the question which I asked of the minister a few days ago I should like to make a few comments about the use and the extremely harmful effects arising from the use of these polyethylene plastic bags that are used quite extensively in the dry cleaning field as covers for clothes and which I understand range in thickness to something less than thousandths of an inch. From reading the newspapers from time to time we all know that these bags unfortunately have caused the death of a number of children both here and in the United States. I have seen the figures of children having been smothered by these polyethylene bags. I have also seen the figures as of the day before yesterday, when another account was given of the death of a child arising out of the same circumstances. Sixty children have suffocated from their use. It is extremely unfortunate that the developers or manufacturers of these particular bags or this particular type of plastic being used for this purpose were not able to foresee the possible detrimental effect they would have. I also read that the industry itself is contemplating a widespread agitational and publicity campaign to bring to the attention of the public, and particularly to that of mothers who have small children, the danger that may result or the harm that could come from the injudicious use of these particular plastic bags.
In this regard I think the Department of National Health and Welfare, not only in so far as polyethylene bags are concerned but as to other items of a similar nature which might be injurious to the health of our people or endanger their lives, should be in a position to take some corrective measures in so far as the use of these bags is concerned. As I understand the situation now,


about the extent of the activity of the department in so far as statutory authority is concerned, as was expressed by the minister in answer to my question, was notably one of publicity and hoping to draw to the attention of everybody in the country to be extremely careful in the use of these bags. It is extremely unfortunate that 40, 50 or 60 children-whatever the number is-or even one child should have suffered loss of life because of the use of things such as these. Even if it is necessary to get some broad general powers of inspection or regulation in so far as these items are concerned, I hope the minister will undertake to confer with the justice department and with his own officials in order to see whether in the future the department cannot go more into the field of regulation rather than in the field of publicity after the damage has been done. I hope that even now, with the publicity campaign that I understand is being carried on by the people in the industry itself, will have some effect and that parents of small children will realize the danger that exists in using these bags and allowing them to get into the hands of children. I hope they will take steps to destroy them as soon as they are able to take them off whatever article they cover.
I should also like to mention a few references and comments with regard to the drug industry and the relation between administrators in the food and drugs division and the manufacturers and distributors of the various pharmaceuticals and second with regard to what I consider in many cases to be the unnecessarily high cost of drugs. I believe anyone who has had occasion to have a prescription given to him by a doctor and then has taken that prescription to a pharmacist will agree with this statement. In most cases people have been shocked by the high costs which they may have to pay for certain drugs which are necessary for ailments they may have. It is not uncommon for people to find charges of $10, $15 or $20 for one prescription. This is quite a shock to the patient. In many cases people find themselves in an extremely embarrassing position in not being able to afford to pay that kind of money for some particular drug that is prescribed for them.
I discussed this question with a couple of friends of mine who are medical practitioners. They say that they have not kept track of statistics but they recall a number of occasions on which, when they have prescribed something, the patient has asked them how much it will cost; and that when they gave an estimate of the cost the patient has then said, "Can you not prescribe something cheaper?" An independent survey was made

in the city of Toronto. How factual these figures are I could not say. However, it has been indicated to me by a person in the pharmaceutical field that upwards of 30 per cent of the prescriptions written by physicians are not filled because of the high prices. People will go into the drug store and inquire as to the price of the prescription, find that it is unnecessarily high and then say "I do not feel quite that ill; perhaps I will hold off for a while, I just have not the money at the moment". Consequently they do not get the prescription filled and they do not get the drugs which may be of some help and benefit to them.
As to high costs, especially in connection with newly introduced drugs, the argument is used that it is necessary for the manufacturer in the first few months or years of sale and distribution of the drug to attempt to recapture his research costs as quickly as possible because with the advent of new drugs replacing old ones and new names replacing old brand names and so on, he may find that the drug on which he has spent money in connection with research in order to develop it fails with the public because something new has come along. This may be a commendable attitude for the drug manufacturer to take and in keeping with our present understanding of business practices, which operate on a profit. However, I am of the opinion that the prices of some drugs are maintained at an arbitrarily high level long after the research costs have been recaptured by the manufacturer.
There is a group of drugs generally referred to as tetracyclines. The percentage of prescriptions which are written for the tetracycline drugs is a matter of speculation, but I have been told that the United States pharmaceutical industry has estimated that 25 per cent of the total volume of drug sales in the United States involve tetracyclines. So far as Canada is concerned there are five companies who produce and distribute the tetracyclines under different brand names. The five companies are: Leclcrle Laboratories, Bristol Laboratories, Pfizer of Canada, E. R. Squibb and Sons and Upjohn Company of Canada. These five companies, because of the uniformity of price and because this price level has been high ever since their introduction on the market, are responsible for some sort of price conspiracy to maintain an arbitrarily high price level. I appreciate that is a question which can be dealt with more appropriately by the combines investigation branch, but I mention it because it is involved in the entire question of drugs.
So far as these brand names which are used by the various companies manufacturing
Supply-Health and Welfare tetracyclines are concerned, this is an indication of the price structure. The price for the manufacture of 16 capsules is uniformly $5.66, and the suggested retail price is $9.44, which represents a 66 per cent difference. I raise this question for two reasons. One is because, as I mentioned earlier, of the total volume of sales of these drugs as indicated by the pharmaceutical industry in the United States; secondly, this particular antibiotic covers a fairly wide range of use and extends to the treatment of quite a large number of ailments. I am sure that any of the hon. members of the house who are medical practitioners would be able to go into more complete detail about the effective use of the various tetracyclines themselves and the type of ailments which they treat.
I would also suggest that there is an arbitrarily high price maintained so far as penicillin is concerned. That is a drug which has also been on the market for quite a number of years. However, as I said that is a question for the combines investigation branch and I only mention it in passing because of its relationship to the administrators of the food and drug division and the industry itself, both the manufacturing and distributing ends of it.
In recent years we have seen, probably in the United States more than in Canada, a pretty wide ranging and I think indiscriminate use of the so-called tranquillizers. Again the United States pharmaceutical industry estimates that the prescription sales which apply to tranquillizers run somewhere in the neighbourhood of 25 per cent. Here in Canada I do not know what the across the counter sales are without prescription, but I have been told that tranquillizers like most other drugs have side effects which were not envisaged when the drug was originally developed. Further, the side effects may develop after a period of use which may change with the individual.
While tranquillizers have been used to quite a great extent in psychiatric work and treatment in mental hospitals, it has been noted with people who use these tranquillizers that they do develop side effects resulting from this use. Some patients might be diagnosed incorrectly by a physician and treated for an ailment which he does not have, and of course that could have very serious consequences to the patient. I am not in any way casting reflections upon the medical profession for not being able properly to diagnose a patient's ailments, but these are opinions expressed by people who have used the drugs, and they have used the classic case of Parkinson's disease, where the continued use of tranquillizers might result

Supply-Health and Welfare in what is called pseudo-Parkinsonism. As one might imagine, that is not a very happy ailment for one to have, and if it is not diagnosed correctly a person may carry on with the indiscriminate use of tranquillizers and find himself in an unfortunate position.
I think as far as this department is concerned steps should be immediately taken so that tranquillizers may be sold only on prescription under the direction of a doctor who is able to regulate the use of the drug and make sure the patient does not get it indiscriminately and possibly develop all sorts of other side effects.
I was going to make some comments about dispensing fees of pharmacists. This is a factor to a degree in the high cost of drugs. To what extent it is a factor it is not possible to say unless one could get hold of a list of dispensing fees established by the various colleges of pharmacy which exist in the country. In many cases the sole function of the pharmacist is just to read the doctor's handwriting and pick up the correct bottle off the shelf and give it to the customer. It does not require now the same degree of proficiency as was required of pharmacists many years ago when they had to mix their own drugs to the prescription of the doctor. This is a field which could bear some investigation.
I am told also that as far as the purchase of drugs is concerned by various governmental departments, there should be a closer check. I suggest that so far as we are able to discover at the moment the Department of Defence Production in its purchases of drugs for the armed forces apparently concentrates on the lowest price quoted for a particular drug. This in terms of quality of drugs could result, and does result in some cases, in the armed forces having purchased for them and having dispensed to them drugs which may be of an inferior quality. I would suggest in this regard that through our own drugs division we might be able to get in touch and establish some liaison with the Department of Defence Production in an attempt to see whether that department will purchase these drugs under the same regulatory control as the Department of National Health and Welfare. I am not suggesting that the drugs are inferior or produced under unclean conditions but some appear not to be produced with the care that goes into the production of others.
Because this is a complex question affecting many, and inasmuch as this is the era of royal commissions which this government delights in appointing, I would suggest that a royal commission be established to deal


with the whole field of drugs and pharmaceuticals inquiring into all aspects of research and production and the impact of competition. In other words, the terms of reference should be as broad as possible. I would suggest the appointment to the commission of a highly competent medical practitioner, a pharmacologist, an economist, a lawyer with extensive knowledge in the combines field and a psychiatrist because all these factors are involved in the question.
There are many other subjects one could discuss at this time but they have been dealt with to some extent by those hon. members who have participated in the debate up to this point. In my view the health and welfare of the Canadian people are of prime importance, our most important resource. Every effort should be bent toward preserving, and enhancing the health and welfare of our citizens. Inasmuch as this department is subsidized I hope it will not be accorded the same treatment given to a branch of another department about which we heard today and which some hon. members claimed was subsidized and therefore should be interfered with.


Herbert Wilfred Herridge: Mr. Chairman, I trust that I will not prove to be a tranquillizer for those on the front benches. I shall be penurious with time and keep my promise in making my remarks as brief as possible. I had prepared a first class speech on the subject but the committee will be denied it in the closing days of the session.
There is a growing concern in Canada, the United States and other countries about fallout. This was the subject of an interesting debate in the British House of Commons recently. I intended to deal with this at some greater length but I shall now leave it for a later occasion.
There is a growing concern in Canada and other countries about a lack of information on the question of fallout and an increasing suspicion that the public are not being told all the facts with respect to the question. From periodicals I have read I know there is a feeling in the United States that the defence department of that country is having some effect on the public being given the information they are seeking in this connection.
To make my remarks brief I shall quote from an article in the July 5, 1959, issue of The Reporter entitled "A Primer on Fallout" which I commend to the attention of all who are interested in the question as being informative and authoritative:
The nation's press gave surprisingly meagre coverage to the second congressional fallout hearings that were held in Washington from May 5 to

May 8. The New York Times, for example, devoted only three inside-page stories to the testimony that was given before Representative Chet Holifield's special subcommittee on radiation of the joint congressional committee on atomic energy; a fourth story headlined "Study Minimizes Fallout Danger" (carried on page 1 and exceeding in length the other three combined) gave details of a reassuring report that was released during the hearings by the atomic energy commission's general advisory committee.
The coverage in most other papers was even poorer than that in the Times. One noteworthy exception, the New York Daily News, carried a concise two-part roundup of the hearings several days after they ended instead of attempting to cover them as "spot news". But in general the press has all but ignored the most complete summary of the fallout situation currently available.
The same applies to the press of Canada with respect to these most important findings and hearings. Another section of the article reads:
Dr. Arthur H. Wolff of the PHS commented on this point as follows:
I think we are generally agreed that strontium-90 as an environmental contaminant certainly deserves the primary attention, because the problem will persist for many years following the cessation of nuclear weapons testing. But I think data collected during the past few years does indicate that some of the shorter-lived isotopes, particularly iodine-131, are not necessarily insignificant-
It is particularly important to look in the young age group . . . Much of the work that has been done in the past has been with adults-
I trust the minister will deal with the question when replying to our remarks because it is important to present and future generations. The people of Canada, the United States and other nations are demanding the truth and the facts with respect to this problem and I trust this government will give the facts to the Canadian people as they are obtained.


Jay Waldo Monteith: Mr. Chairman, I am happy to answer some of the questions raised during the course of the discussion on the first item. I should like to thank all hon. members who have spoken for their co-operation, advice and assistance. I appreciate that this department is responsible for the expenditure of a large portion of the public money and that careful consideration must be given to the spending of these sums. I fully appreciate the words that have been said.
The member for Essex East was desirous of knowing something about the drop in the health grant. I think it might be pointed out that while the total amount available to the provinces under the 1959-60 health grants program is $62,969,175, it is expected that actual expenditures will not exceed $46 million. An appropriation of this amount only is asked for. However, in order that projects up to the full amount of $62,969,175 66968-9-402
Supply-Health and Welfare may be under commitment, authority must be sought for an amount representing the difference between this gross figure and the $46 million cash appropriation.
The hon. member mentioned Salk vaccine. The vaccine is provided free on a federal-provincial cost-sharing basis. I thank the hon. member for Moose Mountain, who is not in the committee at the moment, but he gave a word of appreciation of the services of the doctors of the house.
The hon. member for Essex East agrees with me or at least, shall I say, I agree with him that hospital insurance is a very important step in the health field in Canada. He asked a question as to whether the Ontario outpatient department of the service was as extensive as in some other provinces. No, I am quite free to admit that it is not but there are indications that this probably will be expanded.


Paul Joseph James Martin: Good.


Jay Waldo Monteith: The hon. member was quite frank as to the approach of the province of Quebec on unemployment assistance. If I may say so, his attitude differed from the attitude of some of the members of his party a year ago when I was putting my estimates through the House of Commons. It seemed at that time that it was completely my responsibility, according to those members; that I should practically be responsible for getting the province of Quebec into unemployment assistance. The hon. member for Essex East said that this is entirely a problem for the province of Quebec, and I quite agree.


Mr. Marlin (Essex Easl):: What they meant, I think, was that the minister could give public confirmation of his arduous activity in that regard.


Jay Waldo Monteith: Of course; I am always doing that, Mr. Chairman.
I appreciate very much the remarks of the hon. member for Timmins. He was speaking of hospital insurance. I might point out that we do assist the provinces now. Since I have been in this office we have had three or more technical conferences to discuss hospital insurance. We have men in the field practically continuously-they are in the field right now-assisting the provinces and we try to assist them in every respect. I think we are particularly helpful when it comes to hospital design.
I think the hon. member for Welland made some fine remarks. He has had a wide experience in health problems and what the hon. member has to say is certainly worth listening to. He mentioned fluoridation. I think I might refer him to my maiden speech
6352	HOUSE OF
Supply

Health and Welfare in November, 1953, at which time I pointed out the city of Stratford, my home town, has the best natural supply of fluoride in the water of any community, I believe. There have been extensive experiments and examinations carried on at Brantford, Sarnia and Stratford. I am amazed at one statement he made to the effect that I should ever think of being subservient to any provincial premier. I really did not think he would say that about me.


William Hector McMillan: I did not say that; I said I hoped you were not.


Jay Waldo Monteith: Let me assure him that I am not. However, he also mentioned radiation. I would say that studies have been carried out in conjunction with the national research council to determine the genetically significant dose to the general population resulting from the medical use of X-rays. This project is one phase of the over-all program outlined by the United Nations scientific committee on the effects of atomic radiation and designed to evaluate the various contributions to gonadal dose and therefore the long term genetic effects of radiation exposure. When tabling the report on radiation recently I spoke in the house.
I could say considerably more if required. We are giving it very serious study. We are setting up a total body monitoring unit which will be in use before very long. In the report I tabled some time ago, and in my remarks accompanying the tabling of that report, I pointed out that we are increasing our testing for radiation purposes. I think I can say no more than that we are completely aware of and are examining very carefully the effects of radiation. While I feel that there is no need to panic in respect of this particular matter, we certainly have not lost sight of the fact that it does require very close examination.
The hon. member for Kootenay West was interested in this particular subject and I am sorry that time did not allow him to continue to discuss what had transpired in the British House of Commons. I appreciated the fact that he had discussed this personally with me earlier.
The hon. member for Skeena certainly brought forward some thought-provoking matters for consideration. I quite agree with his thinking on the plastic bag matter. I thank him for bringing it to the attention of the committee today. I feel that, as I said the other day, at the moment the only way we can do very much in this respect is to bring it to public notice, and the fact that he has brought it up here today does contribute to bringing the dangers of this plastic


bag situation to public notice. I have also seen in the paper that the association themselves are taking steps to advertise the dangers of this particular article.
As far as the high price of drugs is concerned, I know they are expensive. I have bought a considerable amount in my lifetime. The hon. member himself mentioned that the companies must recover research and development expenses. I think he probably had the idea that maybe the companies continue to collect these development and research expenses longer than is necessarily required. I am not in a position to comment on that. I would suspect, however, that the combines people probably are examining any possibility of a combine in drug prices. I do not think I have anything further to say at the moment, except to agree with the hon. member for Skeena's closing remark that the health of our nation is probably its most important asset. It certainly will be my endeavour, as long as I am in this office, to keep that foremost in my mind.


Frank Howard: I was called out for a few
minutes and I only heard the latter part of the minister's statement with respect to my suggestions and comments. I do not know whether he dealt in his earlier remarks with some of the things I said. I should like him to indicate his thoughts and ideas on the suggestion of the necessity of a royal commission in the drug field in order to ascertain many factors that are unknown at the moment with respect to whether these drug companies are continuing to recoup what they originally classify as research costs beyond a normal period of time and also whether or not there is waste and squandering in research and advertising in an attempt to promote some of the pharmaceuticals that are developed.


Jay Waldo Monteith: Mr. Chairman, I feel that I must not leave any doubt as to how I stand on this matter. I certainly would not suggest a royal commission in this respect. It think it is an inappropriate undertaking for a royal commission. The hon. member has intimated that some of these research and developments costs may be collected over a longer period of time than necessary. That may be so. I am not in a position to deny such a possibility but I cannot believe that is true of the over-all picture. While some of these drugs appear expensive, I have known of drugs to be particularly expensive when they first came on the market and shortly afterwards, when development and research costs had been partially collected, the drug gradually came down in price. I do not think I could justify the suggestion that a royal commission be appointed.


Frank Howard: The minister referred to the question of the maintenance of high prices for an unnecessarily long period of time and said that drugs had appeared on the market at high prices and that the price had gradually declined as time went on. Has the minister looked at the matter sufficiently carefully to determine whether the decline in price took place because the product developed was not under patent and other drug manufacturers were able to enter the field, analyse the drug, alter it slightly and reproduce the same thing without becoming involved in research costs to the same extent? Would he be able to say whether it would not be a case of a drug being developed by one company and not being patented and another company entering the field and producing the same thing under another trade name at a lower price, a company which did not do any initial research but merely stole-maybe the industry would look at it that way-or purchased the drug, analysed it and developed a similar product without extensive research costs, thus by competition bringing down the price of the produce? Would that not be the ease rather than the company producing the drug having a patent and exclusive rights to market the product with the result that the cost of the product to the consumer would decline as time went on and research costs were recouped?


Jay Waldo Monteith: I am afraid I have not examined the situation to the extent that the hon. member has inquired. However, he has raised some very interesting questions and I should like an opportunity to look into the matter.


[Stage Direction]
Item agreed to.
National health branch-
Health services, including assistance to the provinces-
239. Administration, $364,459.
William Hector McMillan: Mr. Chairman, I am rather curious about the matter of fluoridation. I know the minister is in favour of the fluoridation of water supplies. He said so in his maiden speech in 1953.


Jay Waldo Monteith: Have you got it there?


William Hector McMillan: No. The point is that as minister he has never said anything about it. During the campaign in my area it was said that the Department of National Health and Welfare and the minister had never pronounced themselves in favour of it. That is the point I am getting at, not whether he personally is in favour of it. I should like to know whether as minister he will make a statement and let the people know what he thinks of fluoridation.
66968-9-402J
Supply-Health and Welfare


Jay Waldo Monteith: While the hon. member did not suggest that I was subservient, that is what I gathered at one stage from his original remarks. I refer him to my maiden speech in 1953. He can send to the library and get it if he wishes. At that time 1 was rather boastful about the natural qualities of the water of Stratford which does contain fluoride to a most acceptable degree. I think I might point out that Brantford completed 14 years of experience with water fluoridation in June of this year. The study by the department of health in that city was designed for completion this year. The final year's data are now being statistically analysed, but at the close of 13 years of fluoridation the data showed a reduction of 65 to 70 per cent in the prevalence of tooth decay among children born there since fluoridation began. I am simply quoting statistics. Significant reductions were shown even among those who had moved there since it began.
I would say further that largely on the evidence derived from this study the use of water fluoridation has been recommended by the Canadian Dental Association, the Canadian Medical Association and the Canadian Public Health Association.


[Stage Direction]
Item agreed to.
242. To authorize general health grants to the provinces, the Northwest Territories and the Yukon Territory upon the terms and in the amounts detailed in the estimates and under terms and conditions approved by the governor in council including authority, notwithstanding section 30 of the Financial Administration Act, to make commitments for the current year not to exceed a total amount of $62,969,175, $46,000,000.
Mr. Cardin:: I should like to ask a question on this item. In his opening remarks and in the remarks he made in answer to the hon. member for Essex East the minister referred to the fact that the premier of Quebec had finally decided to permit the people of the province of Quebec to take advantage of the unemployment assistance program.


Jay Waldo Monteith: I did not put it in
those words.


Louis-Joseph-Lucien Cardin: I think the minister did say that.


Jay Waldo Monteith: I did not say the
premier of Quebec had finally permitted.


Louis-Joseph-Lucien Cardin: Is the province of Quebec not enjoying the benefits of this particular program?


Jay Waldo Monteith: Exactly. They have joined and signed.


Louis-Joseph-Lucien Cardin: Of course we all know that prior to 1957 the premier of Quebec always stated that such legislation was contrary to
6354	HOUSE OF
Supply-Health and Welfare the principle of provincial autonomy and incompatible with the British North America Act. I wonder whether, in view of the recent visit of the premier of Quebec to Ottawa, although I will admit that the minister cannot and should not try to force the premier of Quebec to enter into any agreement with the federal government-


Jay Waldo Monteith: You and the hon. member for Essex East had better get together.


Louis-Joseph-Lucien Cardin: We are of exactly the same opinion. We do not believe that the minister should try to force any premier-


Lionel Chevrier: Is the minister looking for an argument?


Jay Waldo Monteith: You started it.


Lionel Chevrier: He will get one if he wants it.


Louis-Joseph-Lucien Cardin: The minister should take advantage of the opportunity, when the premier of Quebec is in the capital, to discuss this very important question with him. I was wondering whether or not the premier may have given any indication as to whether or not he has now decided to permit the people of the province of Quebec to benefit from the great advantages to be derived from the Hospital Insurance and Diagnostic Services Act which costs the Canadian people, including those in the province of Quebec, some $160 million a year.


Jay Waldo Monteith: The hon. member has taken somewhat the same line as certain members from Quebec took a year ago when my estimates were before the committee concerning the signing of an agreement under the Unemployment Assistance Act which has been achieved. I can only repeat what I said on that occasion, and as the hon. member for Essex East said this afternoon, that this is a matter for the province of Quebec to decide. They are fully aware of the provisions of the Hospital Insurance and Diagnostic Services Act, and it is up to them to make up their own minds as to whether or not they will come under it.


Louis-Joseph-Lucien Cardin: I think there must be something wrong with the acoustics. I did not in any way suggest to the committee or ask the minister to force or try to coerce the premier of Quebec into entering into an agreement. The point I was seeking to make clear was whether the minister took advantage of the opportunity of the visit of the premier of Quebec to Ottawa to discuss with him, either at that time or any other time, this matter and whether subsequently through correspondence there may be some indication that the premier of Quebec had


changed his opinion, as he did in the case of the Unemployment Assistance Act.


Jay Waldo Monteith: I think a year ago now when my estimates were before the house I intimated that there were indications the premier of Quebec at that time was interested in the hospital insurance measure.


Louis-Joseph-Lucien Cardin: How about now?


Jay Waldo Monteith: I think the situation
still exists.


Louis-Joseph-Lucien Cardin: More or less?


Jay Waldo Monteith: I think it still exists.


Paul Joseph James Martin: Before we leave this item, I think I should intervene briefly on this matter because the minister has been seeking to use my approach to this problem as an argument against what I feel is the meritorious suggestion of the hon. member for Kichelieu-Vercheres. I have said, and of course the member himself has indicated he recognizes that all the constitutional rights of the provinces must be respected in these matters, that there must be no compulsion exercised on any province; we are all agreed on that. What the hon. member for Richelieu-Vercheres is trying to indicate to the minister is whether the minister has taken, within his constitutional limits, all those steps to persuade the province of Quebec to enter a scheme that obviously is to their advantage, a scheme in which they will share generously in the financial grants which the former Liberal government made available to them.


Jay Waldo Monteith: After 30 years.


Paul Joseph James Martin: If my hon. friend wants to interject observations that are calculated to make his task a little more difficult, that will be a decision for him to make. Thus far, I have given him no justification to do that.
The Liberal party, which placed hospital insurance on the statute books, regards this measure, as the minister now says, as very beneficial to the people of this country. The hon. member wants to make sure that the minister, and this government, is taking every advantage, within constitutional limits, to bring home to the province of Quebec the desirability of participating in this scheme. The Prime Minister had a 90-minute interview with the premier of Quebec. I do not know what they discussed. Neither the premier of Quebec nor the Prime Minister of Canada take me into their confidence on these matters. I have no way of knowing what they discussed. Can the minister say whether this was one of the matters discussed? Did

the minister himself, while the premier of Quebec was here, discuss this matter with him or with any of his ministers?


Jay Waldo Monteith: I am very happy to announce right now that I did not discuss the matter with the premier of Quebec.


Paul Joseph James Martin: All right, then. May I ask the minister, whose vigour in these matters is becoming more impressive day by day, if he suggested to the Prime Minister that during the course of this 90-minute interview it would be desirable if he were to ascertain-


Jay Waldo Monteith: No, Mr. Chairman.


Paul Joseph James Martin: -whether the premier of Quebec wanted to insure the health of the people of Quebec through this hospital insurance program; that is the suggestion made by the hon. member for Riche-lieu-Vercheres. I think it is a reasonable one. If these interventions have no other effect than to cause the Minister of National Health and Welfare to take his holidays this summer in Quebec and take advantage of that holiday to bring home to the premier of this province the desirability of this scheme, then they will be worth while. The hon. gentleman shares the same political views as the premier of Quebec, and if he cannot persuade him of the desirability of this, I do not know who can.


Frank Howard: In view of the remarks made by the hon. member for Timmins with respect to a national hospital insurance participation plan which would embrace not only doctor and dental coverage but would extend to the question of research in all fields of medicine, and in view of the fact we have had the endorsation of the hon. member for Essex East that this facet of socialism is not to be shunned any longer but is now an acceptable thing-


Paul Joseph James Martin: I never said that, of course.


Frank Howard: My friend did not say that the socialist principle-


Paul Joseph James Martin: I said Liberalism.


Frank Howard: -was acceptable, but he indicated in his remarks that he was no longer afraid of this type of program. The hon. member for Essex East is very careful in his choice of words, but he did embrace the socialist principle so far as hospital insurance is concerned.


Paul Joseph James Martin: There are many terms that would be offensive, but I would
Supply-Health and Welfare not want the hon. gentleman to use any word that I would regard, personally, as abhorrent.


Frank Howard: Perhaps if my hon. friend stuck to agriculture he would get into much less difficulty.
In view of the presentation made by the member for Timmins in suggesting that it is now time for the federal government to provide leadership in the field of an allinclusive health scheme rather than a hospital insurance scheme, and in view of the fact that within one year of the time the federal government took the initiative we now have eight provinces participating in this scheme, will consideration be given to enlarging this scheme and making it allinclusive? Can the minister say whether any steps have been taken, in conjunction with the Department of Finance because money would be involved, toward conducting a survey or an investigation into putting such a plan into effect, an all-inclusive health scheme instead of this narrow hospital scheme?


Jay Waldo Monteith: No, Mr. Chairman, and I would explain that "no" in this way. When the hospital insurance scheme was introduced in the spring of 1957, and eventually when the provinces began to come into the scheme as of July 1, 1958, I said that this was a big step. I said today in my opening remarks that it is probably the biggest step that has been taken in the health field in Canada.
I am completely convinced that there is only one thing to do at the moment and that is to get the Hospital Insurance and Diagnostic Services Act operating in such a way that it will be satisfactory across the country. I said also that this act has come into being in a more orderly way, I would think, than we had originally expected. We expected more bottlenecks and more headaches. At the moment my prime concern is to see this act operating as completely to the benefit of the people of Canada as possible. I am afraid I have given no thought to any further extension of the situation at the moment.


Frank Howard: My friend the hon. member for Essex East and his colleagues, when they were the government, for a period of some 39 years have played on this theme of a national hospital insurance program. Eventually after 39 years they got around to thinking about it.


Mr. Hodgson:: They were forced into it by the province of Ontario.


Paul Joseph James Martin: Do not start that argument.

Supply

Health and Welfare


Frank Howard: I hope the government of which my friend the Minister of National Health and Welfare is a member is not the government of this country for the next 39 years. But in any event I hope it will not take us another 39 years to take the next step and provide some sort of leadership as that which I have suggested.


Mr. Cardiff:: I would like to ask the hon. member for Essex East who was the minister of national health and welfare in the last government, why he did not bring in a comprehensive insurance plan in the 22 years he was in power.


Paul Joseph James Martin: I should be glad to answer that question. I do not have responsibility at the moment for policy; I wish I had. I can only say that I was not minister for 22 years. But during that time I was minister in a government that brought in family allowance, old age security, old age assistance, pensions for the disabled, pensions for the blind, hospital insurance, veterans insurance and unemployment insurance.


Douglas Mason Fisher: Do not forget the pipe line.


Lewis Elston Cardiff: I might ask the hon. gentleman why that was only in the last 10 years before they went out of office.


[Stage Direction]
Item agreed to.
247. Administration of the Opium and Narcotic Drugs Act, $226,469.
Frank Howard: This item has to do with the administration of the Opium and Narcotic Drugs Act. This matter is also dealt with to some extent under the Department of Justice, especially in connection with the enforcement agencies and the penalties meted out to people who contravene the laws relating to the possession of and trafficking in narcotics. We have mentioned this matter on a number of occasions. As of recent years, the Minister of Justice has indicated that he is very partial and has been thinking quite seriously about establishing or developing a different approach to the question of narcotic addiction and possession of narcotics.
As to this vote, I assume that the Department of National Health and Welfare would be involved in that sort of study and that sort of investigation which might allow us to move into what I would consider to be a more sensible and more humane approach to people who are addicted to narcotics and with regard to the enforcement of the law and the incarceration of these people in institutions. I wonder whether the minister can give us an indication of the different fields of jurisdiction as between his department and the Department of Justice

in this particular field and also an indication as to what his department is doing in order to work in conjunction with the Minister of Justice having regard to the minister's indication of a new approach to narcotic addiction.


Jay Waldo Monteith: The Department of National Health and Welfare supervises the use of narcotics for health purposes. As the Minister of Justice mentioned in answer to the hon. member's question this morning, we are studying this problem together, both departments are co-operating, with a view to coming up with the best possible solution or the best possible assistance.


[Stage Direction]
Item agreed to.
Welfare branch-
Old age assistance, blind persons and disabled persons allowances-
249. Administration, $114,915.
Douglas Mason Fisher: Under old age assistance I wish to ask the minister about something which I cannot explain very well because I do not know it very well. It is with respect to a problem or two problems of particular persons who were under old age assistance or who were having old age assistance, and who then obtained jobs and there was a hold-up or misunderstanding in their notification to the welfare authorities that they had work. As a consequence payments kept on for a couple of months before they were finally cut off. I understand that in clearing the matter up these people felt that they were prejudiced in the way, let us say, of paying back.


Jay Waldo Monteith: In the administration of it?


Douglas Mason Fisher: Yes. From the letter I had from the provincial authorities in Toronto I gathered that they tended to agree with those who said there were grievances but that this matter had been put up to the federal authorities and that until the federal authorities changed the regulations there was nothing they could do about the matter. I am sorry to be obliged to give such a woolly explanation but as I say, I have not too much familiarity with the matter.


Jay Waldo Monteith: My reply will be somewhat woolly also. Incidentally, may I say that I do not agree with the hon. member in his suggestion that his query was woolly. I might say, however, that these cost-sharing pieces of legislation are administered practically 100 per cent by the provinces; and in an old age assistance or disability allowance problem the provincial people make an examination or a study of

the situation and we simply come along and are asked for our monetary contribution toward the cost-sharing program. I cannot see where we have been at fault in that we have refused at some stage to allow a certain adjustment to be made and that sort of thing. Actually I would point out that we have called for a conference on September 28 and 29 of all the provinces in respect of these various cost-sharing programs. We hope that out of that conference will come some possibility of better regulations or better understanding of the act so that what we all seek, namely simple justice to the recipients, will eventually transpire.


[Stage Direction]
Item agreed to.
B-Civil defence-
251. Expenses of the civil defence program, $7,220,817.
Joseph Pierre Albert Sévigny: We will now reconsider items 251 and 303, which were deferred until today. They cover the same subject.


Douglas Mason Fisher: May we have a statement from the minister?


Jay Waldo Monteith: Yes, Mr. Chairman. I intimated when I started my estimates that I would have a statement to make at this stage. Actually I had rather a comprehensive statement but


Paul Joseph James Martin: May I assist the minister. This is the first statement the minister has made in a long time, particularly since the new arrangement announced by the Prime Minister. There are a number of matters on this important subject, notwithstanding the lateness of the hour, that simply have to be discussed; for example, the questions of evacuation and shelter. We have to have some indication from the government about its policy on civil defence. I would hope the minister is in a position to deal with it now.


Jay Waldo Monteith: Yes, Mr. Chairman, of course I am. I will be very happy to give quite a comprehensive statement.


Paul Joseph James Martin: Before the minister does that, the Leader of the Opposition makes the suggestion that we might be able to deal with the situation in a manner which will be convenient to the Prime Minister who has at this time other preoccupations. We would have no objection to dealing with item 303 now, provided it is understood, as a result of its overlapping character, that when we discuss the minister's responsibilities we will not be precluded from discussing the implications in vote 303.
Supply-Privy Council


John George Diefenbaker: Mr. Chairman, that is satisfactory.
Item stands.



PRIVY COUNCIL

[Stage Direction]
303. Preparatory work, not within the fields of particular departments, on emergency defence measures, $175,000.
John George Diefenbaker: Mr. Chairman, there was only one question raised and that had to do with the powers under the Defence Production Act. That question was asked by the hon. member for Kenora-Rainy River, and he pointed out that certain of the powers under the Defence Production Act were being allowed to lapse. May I point out that those powers will be lapsing at the end of July and are sections 23 to 31 of the Defence Production Act.
Those particular powers were extraordinary powers, and powers of unusual import. Section 23 provides that any person refusing a contract from the Minister of Defence Production may be ordered to comply, and that any person refusing to comply to a direction would be liable for the loss thereof and for damage thereto. Then section 24 provided that the minister might requisition supplies made by notice in writing, and direct any person who owns or has in his possession or control defence supplies, to have them requisitioned on behalf of Her Majesty. Section 27 says that where the minister is satisfied that a person who has entered into a defence contract has failed or is likely to fail to perform the contract in a businesslike and efficient manner, he may authorize another person to carry on.
Section 28 provides that the governor in council may, by order, direct that a person shall not be bound by any obligation, restriction or limitation imposed on that person by any statute, order, regulation or contract. In other words, these extraordinary powers provided rights and assured authority which was overwhelming in its import, to which of course, when we were in opposition, we took strong objection.
These extraordinary powers will lapse, as I said, at the end of this month because, as has already been pointed out, the government does not intend to continue in days of peace powers which, although properly exercisable in wartime, ought not to be used in days of peace. With regard to what I suggested last evening, I want to say that these powers set out under the Defence Production Act are, in the opinion of the government, not necessary in days of peace and it would be inexcusable to continue them on the statute books beyond the period of their actual existence under the statute.

Supply-Privy Council
Hon. members will remember that a period within which these extraordinary powers should continue to exist was asked for on the part of the opposition of that day and accepted by the government of that day. I think tile house will generally agree that the step taken in this connection is one that is in keeping with the responsibilities of parliament to ensure that the fundamental rights of the individual shall not be encroached upon by order in council or by parliamentary direction or enactment. We believe that these powers are not necessary any more but that, in the event that the possibility of an emergency arises or in the eventuality of war, the extraordinary powers provided under the War Measures Act are sufficient.
With respect to the plan that I placed before the committee last evening, I do not think there is very much more I can add to that which I have set forth already, except that the use of nuclear weapons is a distinct possibility against -the countries of the free world, and while in general free mankind will agree that the possibilities are terrible in their import, governments cannot adopt merely a fatalistic attitude but have a duty incumbent upon them to safeguard the ability of the nation to survive even a nuclear war. All of us realize there are bound to be enormous losses and casualties. The Leader of the Opposition dealt with this matter in general some weeks ago, and in his speech placed before parliament and the country something of the awful potentialities of a nuclear war. What we have tried to do is to plan an organization which will preserve some degree of governmental and economic organization during the initial period of a nuclear war. We have set up through the committee, a special full time working group established in September 1956 under the former government, as we see it, a streamlined and efficient system whereby under a regional structure provincial government organizations will be knit with the military organizations and will thereby assure through decentralization that a national organization will be achieved.
The minister will deal with the question of civil defence. I can simply say that the government has reviewed and revised the organization to deal with civil defence matters and to also avoid a confusion of labour between the federal and provincial organizations in this field. The general nature of the changes proposed were set out in my speech of March 23 and the minister will tell the committee, if required, of the discussions on April 24 between him and other of my colleagues and representatives of the provincial governments.

The provinces expressed no objection to the dominion government proceeding as outlined and thereafter gave their views with respect to the general plan. On May 28 the governor in council approved an order whereby under the Public Service Re-arrangements and Transfer of Duties Act there was a redistribution of civil defence functions, some to national defence, some to national health and welfare and some to the Department of Justice through the Royal Canadian Mounted Police, some to the emergency measures organization and the privy council office.
In so far as the emergency measures organization is concerned the redistribution of civil defence duties involved have full regard to the co-ordination of civil defence plans for departments and agencies of the government of Canada. The preparation of civil defence plans in relation to matters that are not the responsibility of any other department or agency of the government of Canada, assistance to provincial governments and municipalities in respect of preparations for civil defence where assistance is not the responsibility of any other department or agency of the government of Canada and finally a general liaison with other countries, with NATO, and with provincial governments on matters relating to civil defence.
The main purpose of the changes and redistribution of civil defence duties was to closely integrate them with the general government organization for war purposes, assigning to national defence those tasks which are akin to operational service tasks; to health and welfare those tasks relating to health, utilization and the welfare of Canadians under war conditions; to the Department of Justice those matters that are essentially police tasks; and to the privy council office those planning and liaison fields of responsibility that are similar to the normal duties of this office.
I believe that in general summarizes the general plans which form the basis of what we hope will achieve on a national scale with provincial and subdivided local organizations a national organization effective for the purposes which I outlined last evening.


Lester Bowles Pearson: Mr. Chairman, I recall, I think almost as vividly as the Prime Minister does, the debate of 1952 on the emergency powers provision of the Defence Production Act. I am not surprised at the decision of the government to let these emergency powers lapse at the end of that five-year period. That will produce a situation in which coercive powers cannot be based on that legislation, if the government desires to use them, and there will have to be some other legislative basis. The Prime Minister has indicated that in the

awful contingency he has mentioned, that would be the War Measures Act.
The fact remains, of course, as the Prime Minister pointed out last night and again today that in the contingency of nuclear war extraordinary steps would have to be taken and extraordinary powers would be required. It was never intended under the Defence Production Act that emergency powers would be used except in emergency conditions. I am quite sure that is the attitude of the government now in respect of the plans it is making -and rightly making-for this contingency.
I understand from what the Prime Minister has said that there is nothing of coercion in the plans that are being developed by the government to meet this contingency and that any action to be taken before the War Measures Act could be called into effect or invoked would be voluntary. But I have this to say on that. If those steps ever had to be taken they would be taken in the circumstances of the greatest possible emergency, probably an emergency of a type which we have never had to face in this country before.
There is a difficulty involved in this, one that was very much in the mnd of the previous government when they had these emergency powers under the Defence Production Act. The War Measures Act can only be invoked as a legislative basis for action when there is formal declaration of war or "apprehended war" as I believe the act states. We do not know what form this emergency will take. If it ever descends on us it is difficult to visualize the awful situation that may result. There might indeed be a kind of shadow period between attack, or what seems to be attack, or what might even be a false nuclear attack, and the actual formal declaration of war which would be required on our part, if there were any of us left to declare war. In that shadow period if the government required power for coercive action in the light of the situation that existed, and I am sure it would, the government would have to rely on that clause of the War Measures Act that would permit it to take action in apprehended war until there was a formal declaration of war. That could only be done by order in council. There would however be a gap between the attack or the emergency and the formal declaration of war because it is our constitutional practice, although it is certainly not law, that war can only be declared after parliament has been called and has approved the action of the government.
It is our constitutional practice now, though certainly it is not the law, that war can only be declared after parliament has been called and approved the action of the 66968-9-403
Supply-Privy Council government; at least, I think it is the accepted constitutional doctrine, though certainly not any part of the law of the constitution, which permits the executive and only the executive to take the formal step. Therefore, it is a very complicated situation in that respect, and I bring these complications to the attention of the government not because I am objecting in any way to the plans they are making. They are essential plans, and it is well to plan in advance, even though we hope the plans will never have to be carried into effect. But if these plans are to be carried into effect, it will have to be done now under the War Measures Act, under that provision of the War Measures Act-and the Prime Minister will correct me if I am wrong; perhaps he has the act before him-which enables the government so to act in a state of war or apprehended war. My colleague from Essex East says it is section 2.
I am not objecting in any way to what the Prime Minister has indicated is necessary, but I am pointing out that there may be steps which will have to be taken, if this awful contingency ever arises, long before we can get together in parliament and take whatever steps are required in connection with a declaration of war, and it might well be that in that shadow period between the loss of peace and a formal declaration of war action by order in council would be required.
I bring these matters to the attention of the Prime Minister and of the government partly as an explanation of the stand we have taken in the past in this party when we thought emergency powers might be required, and partly to assure them that while we do not object to the action which is being planned, there will be perhaps constitutional difficulties against which provision should be made in advance.
This proposal of the government, as I understand it-the Prime Minister will correct me if I am wrong-does not involve a course of action in any respect under which the War Measures Act can be invoked.


Douglas Mason Fisher: Mr. Chairman, on behalf of our group the only comment we wanted to make was to welcome these indications that the government is aware of and prepared to move very quickly under provisions which would enable the government to keep going in the event of a real catastrophe. I think my point of view is somewhat conditioned by the fact that any kind of war now is going to be a catastrophe for civil defence in the way other wars have not been in the past. The Leader of the Opposition brought up the question-I think it is an academic question-as to whether parliament could be
6360	HOUSE OF
Supply-Privy Council convened and whether this will leave the government short of powers. This is something on which we can almost take the common sense view of in the light of the kind of war we are going to have. I think the tragedy or catastrophe will be upon us so quickly that there will really be no time even for us to consider the idea of calling parliament.
I have often wondered about that particular point, because anyone reading back in Hansard and back in Canadian history knows that the late Mackenzie King always had the feeling that you could not declare war until parliament was called. I remember at the time many people thought that was a rather doubtful situation; that it was more likely his way of evading certain responsibilities that might have been upon him by the imperial connection at the time.
But the part about the program that is covered by this vote of $175,000, though I do not think any of us wanted particularly to pry into that, what we can worry about is, in the light of the expenditure, that it seems rather small in relation to the gigantic nature of the problem, if we think of the war as a catastrophe in terms that have been explained to the United States congressional committees which seem to indicate that at least 50 per cent of the population, in the event of a full-scale nuclear war, would be knocked out and there would be many dislocations.
I know it seems rather silly to ask for an assurance from the Prime Minister that $175,000 is enough. It does seem like a rather small figure for assuring continuing alertness of organizations at the drop of a hat or a press of the button of an intercontinental ballistic missile, and that they would be ready to go to work.


John George Diefenbaker: The point the hon. member makes is obviously a good one, provided that what he says actually represents the situation. The amount that he mentioned is merely one of the items and in respect of the organization as a whole for purposes of security. Those expenditures which will amount to a great deal more than that-and I think it is an understatement when I say that-will be under the head of defence and also in part under the Department of National Health and Welfare. The actual amounts will far exceed, even in the next few months, the actual vote here, but will be expended under other headings so as to assure that degree of security, confidentiality and secrecy of the courses being taken and the actions and constructions that will follow.
In so far as the references made by the Leader of the Opposition are concerned, we


concluded that these extraordinary powers under the Defence Production Act ought to be demobilized and that indeed-and I am not going to relive the discussions that took place three years ago-was the stand that we took most strongly. In the light of experience of office we believe that the stand we took was a reasonable one and that the very comprehensive and aggressive powers which have heretofore existed in the Defence Production Act were not in keeping with the parliamentary system of government, or indeed of the concept of freedom which I think is generally accepted without regard to political views or bias.
In so far as the War Measures Act is concerned, the Leader of the Opposition points out-and he is supported in that by the hon. member for Port Arthur-that the day of a declaration of war is past. For generations there were certain courses that were followed. International lawyers set them out in detail, but all of us today have an abiding fear of instant attack launched without notice, the purpose of which will be to attain disorganization, if not immediate victory, by the acceleration of the attack and by concealment of the intent to make the attack. However, in so far as the War Measures Act is concerned, its powers are very wide. I am not going to enter into a legalistic discussion of such powers, but the wording of section 2 is of interest:
The issue of a proclamation by Her Majesty, or under the authority of the governor in council shall be conclusive evidence that war, invasion, or insurrection, real or apprehended, exists and has existed for any period of time therein stated, and of its continuance, until by the issue of a further proclamation it is declared that the war, invasion or insurrection no longer exists.
When the hon. gentlemen said that henceforth it will be accepted in our country that we are not at war officially without the declaration of parliament I think the experience of the past certainly adds weight to his conclusion. But the fact remains that the executive, the governor in council, will continue to have power to act by a simple declaration under the War Measures Act that a state of danger exists and under that to take the necessary and immediate action which would have to be forthcoming pending, of course, the convening of parliament.
It is to assure that parliament can be convened that in part the emergency organization is set up, for after all none of us, looking into the future, can contemplate parliament in the ordinary sense of the term meeting as we did in this chamber during the darkest days of the last war and in the old chamber prior to its destruction in February of 1916. The powers under the War Measures Act cover every possible eventuality in so

far as those measures are concerned which of necessity must be taken without waiting for the convening of parliament and the passing of legislation. That is the reason I say that we felt that the powers under the Defence Production Act were not needed and, indeed, the legislation of an emergent nature passed at successive sessions of parliament from 1949 on was in general based on the decision of the courts to the effect that the executive may at any time declare the existence of an emergency and during that emergency is endowed thereby with powers to act effectively and efficiently without parliament until parliament can give official approbation to the course taken.


Lester Bowles Pearson: May I just ask this question of the Prime Minister. It is a fact, I take it, under the law or will be when that emergency power provision of the Defence Production Act expires that if there is an emergency and if the government wishes to take action in that emergency which requires coercion or compulsion of any kind that could only be done by a declaration of apprehended war by order in council.


John George Diefenbaker: I did not get the question.


Lester Bowles Pearson: I will repeat it. I want to get this matter perfectly clear. I asked the Prime Minister whether it was not a fact that after July 31, when the Defence Production Act emergency power provisions expire, if there is an emergency and if that emergency is of such a character as to require coercive action, compulsive action by the government, that action can be taken only by the government declaring through order in council that a state of apprehended war under the War Measures Act exists.


John George Diefenbaker: I would not want to give an opinion on that. That is a legal question, one that would require the opinion of the law officers of the crown.


Paul Joseph James Martin: I want to say a brief word on this matter while the Prime Minister is here. I had ministerial responsibility for some of the planning which the Prime Minister observed last night had been prepared when the former government was in office. On this point the Prime Minister said, as found on page 6273 of Hansard:
As hon. gentlemen opposite who were members of the former government realize, general plans in this connection were considered by the former government and those plans have been considered and advanced in the last two years.
I recognize at once that the leadership given by the office of the privy council in this matter when we were in office is something that one should refer to with gratitude and appreciation. The Prime Minister 66968-9-403J
Supply-Privy Council
has stated that the government has decided to allow the lapsing on July 31 of sections 23 to 31 of the Defence Production Act. I would simply point out that this matter, at least potentially, is one of the most important matters parliament will discuss. It is therefore important, I think, that there be some precision both in expression and thought on this matter.
The government takes the responsibility for the lapsing of these pertinent sections in the Defence Production Act. That is a responsibility which the government, after consideration, is prepared to take. As the Prime Minister observed, and he did it in a non-acrimonious way and I am not seeking to reverse that mood, ultimately the renewal of the powers extended was a matter of suggestion by the former opposition and then there was mutual concurrence. The Prime Minister feels, however, that the implications of the War Measures Act, and I take it he had in mind particularly sections 2 and 3, are such as to give the executive the necessary coercive powers to deal with any situation that would arise either from a state of war or pursuant to section 2, as the Leader of the Opposition has observed, from a state that could be characterized by the word "apprehended" which is to be found in section 2 of the act.
The Prime Minister has also indicated in answer to a question by the Leader of the Opposition that the implications of what he said last night involve nothing coercive. It involves voluntary participation by agencies and persons in the country who might, through the Department of Defence Production or the Department of National Defence, be called upon to assist in an operation which is essentially a planning operation. If one could describe the announcement of the Prime Minister last night, it is essentially a planning operation and a very necessary one for the conduct of government in the turbulent stage that would prevail if we ever have an apprehended or actual state of war.


John George Diefenbaker: Positive planning and organization.


Paul Joseph James Martin: Yes-all of which we on this side fully approve. Our main concern last night, certainly the concern of the Leader of the Opposition and myself, was whether or not these powers involved the element of coercion. But it seems to me that the Leader of the Opposition has underlined a situation that is very real and it is only offered for further consideration by the government. That is whether or not in the situation that could prevail before a state of apprehended war it would not be
6362	HOUSE OF
Supply-Privy Council necessary for the executive to resort to certain preparations, the realization and implementation of which could possibly only be effected by the use of powers envisaged at least in principle like those referred to particularly in section 3 of the War Measures Act.
But the government has considered that matter and the opposition will discharge its function at any rate by pointing out this situation to the government. But we do agree that these preparations are necessary. We do agree it is necessary to take steps to put into motion the machinery that would make effective the kind of defence or resistance that Canada would offer in the event of an attack, but this pre-apprehended state is one that I think the government will have to consider in the light of what powers it will have after July 31. As I say, the Prime Minister has said that the government has given careful consideration to that aspect, and we can do no more than point out a situation which can arise.
There is one other point I should like to mention before the Prime Minister leaves, and that is on the general aspect of civil defence. The government has decided to distribute the ministerial functions of civil defence. With the reasoning behind that distribution I have no quarrel, that is to the Department of National Defence, to the Department of National Health and Welfare, to the office of the privy council, to the Royal Canadian Mounted Police through the Minister of Justice. I think one of the dilemmas in all this has been properly referred to in the Ottawa Journal, in an editorial which appeared on June 6 of this year and headed, "Like the Chestnut Tree". It reads:
Civil defence was formerly the responsibility of the department of health and welfare. Now we are told, it will fall under national defence, health and welfare, justice, and the Prime Minister's office. In effect, this latter makes it an issue to be ruled on by a committee of the cabinet of which Mr. Diefenbaker will be chairman. Whatever may be the reason for the administrative change, the man in the street will fear it as an open door for a monumental mix-up.
I suggest to the Prime Minister that there must be some minister who will be responsible as the first minister in the matter of civil defence. In the cabinet itself, and in the executive relationship with provincial governments, among the ministers who are going to continue to have a responsibility in civil defence, there must be one minister who is, let us say, chairman of all and who will be responsible for seeing to it that consideration is given to the over-all formulation of policy.
When the Prime Minister spoke first he did not deal with this matter-I am not
[Mr. Martin (Essex East) .1

saying this critically-but does he feel that with his responsibilities he is the one to whom should be entrusted the responsibility of coordinating these departments?


John George Diefenbaker: I will answer that immediately and say no; the minister who will be chairman will be the Minister of National Defence.


Paul Joseph James Martin: That is a definitive answer and I thank the Prime Minister for it.
There is one other aspect of this problem. I understand the Prime Minister's announcement in May or thereabouts suggested that the role of co-ordinator would be undertaken by the office of the privy council. The Prime Minister has indicated that the spokesman, generally speaking, will be the Minister of National Defence. The situation possibly may be a little more complicated because the office of the privy council now has a coordinator in the person of a very efficient and capable gentleman. It does seem, unless he is going to be made immediately responsible to the Minister of National Defence or to another minister, his position vis-a-vis the ministers who are heads of departments, is going to be a very difficult one. I would hope the Prime Minister would associate with the reply he has already given, not only that the Minister of National Defence will be the spokesman of and responsibility for policy but would he indicate which minister will be responsible for the work undertaken by the privy council, particularly through Mr. Currie for whom I have the highest regard and whose competence I am not for one moment seeking to belittle. I say it is putting the other ministers in a difficult position, vis-a-vis a public servant. Would the Prime Minister clarify that as well?


John George Diefenbaker: In so far as the privy council is concerned, of course, the Prime Minister occupies a position in charge of the privy council. I foresee none of the difficulties mentioned by the hon. gentleman. You will always find these dislocations taking place in the building up of an organization. If in the light of experience the wisdom of the hon. gentleman and the observations he has made make changes necessary, those changes will be effected in the interests of the assurance of the maximum efficiency of the organization set up.


Paul Joseph James Martin: So far as we are
concerned, if the Prime Minister wants to stay and learn something about civil defence he is welcome, but I do not think we are going to insist that he should remain.


John George Diefenbaker: This is a great spirit here, Mr. Chairman, when the hon. gentleman

grants leave to me to absent myself from further discussion on the estimates that come under the authority of the Minister of National Health and Welfare.
DEPARTMENT OF NATIONAL HEALTH AND WELFARE B-Civil Defence-
251. Expenses of the civil defence program, $7,220,817.


Jay Waldo Monteith: I do not propose to make any extensive statement on the item of civil defence. The Prime Minister has covered the transition from the situation as it has existed to what we propose to do. One year ago, when my estimates were before the committee it will be recalled that General Graham was in the midst of making his survey. The ultimate setting up of a cabinet committee resulted in the Prime Minister's announcement of March 23 in the house, and then this was followed by discussion with the provinces on April 24, at which time they showed complete agreement, most enthusiastic agreement, with our suggestions. Eventually, order in council 1959/656, which was tabled next day, gave instrumentation to these suggestions. It has been proposed now that we hold a further discussion with the provinces in a meeting to be held early in October, at which time the conclusion of these arrangements which we have entered into and the outcome of the committee will show us, we hope, just what further steps should be taken and how we may further co-ordinate the whole civil defence effort.
I should like, however, to make a brief reference to a subject upon which I have been queried in the house by the hon. member for Essex East and which I know is uppermost in everybody's mind. I refer to shelter and evacuation. I would point out, very briefly, that for something in the neighbourhood of five years, that is from about 1948 to 1953 or thereabouts, the scale of probable attack was assumed to be an atomic bomb of 20 to 100 kilotons. This is equivalent to 20,000 to 100,000 tons of TNT. At this stage there was little or no thought of evacuation of the target area population and little stress was placed on the organization of reception areas for those who may leave the larger urban centres.
I think I might point out that the advent of the H-bomb made necessary a drastic revision of this phase of civil defence policy. From about 1953 on, the emphasis began to shift from static defence, where people stayed put to mobile defence, involving the large scale dispersal or evacuation of our urban populations. Moreover, the greatly increased destructive power of the thermonuclear bomb -ranging in size from 1 megaton to 20
Supply-Health and Welfare megatons, the equivalent of 1 million tons to 20 million tons of TNT-meant that a single bomb, properly placed, could almost completely wipe out any but the largest of our urban target areas.
These greatly increased areas of destruction, together with the newly discovered realization of the great dangers over large areas of radioactive fallout, meant that it was no longer realistic to assume that the population of the average city could survive the blast by taking shelter, and then emerge with its resources and facilities substantially intact to undertake its own rescue and rehabilitation work. Civil defence began to emphasize that distance is the best defence against the H-bomb; and planning for the rapid and orderly evacuation of large urban populations in the event of emergency began to feature the civil defence policies of most of the western democratic countries.
But, Mr. Chairman, times of course are changing. As military science advances we move from the era of the H-bomb and the manned intercontinental bomber to that of the intercontinental ballistic missile equipped with a nuclear warhead. Increasingly in the future we shall be unable to count on any advance warning time. Moreover, the over-all need for the adequate provision of relatively light and inexpensive shelters, if only for shielding from widespread radioactive fallout, emerges as an increasingly urgent problem. While the cost of providing heavy anti-blast shelters on any large scale continues to appear prohibitive, recent United States studies, notably that of the Rand Corporation, and the testimony recently given before the Hollifield committee of the U.S. congress, point to the feasibility of developing light and resonably effective shelters, particularly against fallout, at cost magnitudes considerably less frightening than the estimates previously given. Recent studies have been made by our own defence research board which seem to point to the same conclusions.
All these materials and reports are now being carefully studied and reviewed, and while it would not be wise or proper to hasten unduly the work of the committee which has been established to study and report upon this question, I believe that within the next few months we will be in a position to discuss with provincial authorities some proposals for establishing an appropriate balance between evacuation and shelter, particularly shelter against fallout.
There is one brief word I should like to say in conclusion, Mr. Chairman. As you know, civil defence in essence means preparedness to meet disaster from whatever quarter it may come. While our civil defence preparations are designed primarily to
6364	HOUSE OF
Supply-Health and Welfare provide protection for our civilian population in the event of war, they really serve a dual purpose. Communities and individuals who are prepared and trained in civil defence are ready to play their part in other forms of disaster as well. Nothing could possibly have illustrated this more graphically than the disaster which struck the town of Lanark on June 15th last. In that disaster trained civil defence workers from our civil defence headquarters at Arnprior did credit to themselves and to the service they represent, and I should like to conclude by reading this brief letter received by the college commandant, which pays a well deserved tribute to the work they did in Lanark. It is addressed to Major General M. H. S. Penhale and reads as follows:
I have just returned from unfortunate Lanark where the scene of devastation is, as you are well aware, one that till now at least we have comparatively seldom been called upon to face up to in this country.
While talking to old friends in the village-some had lost all they possessed-I particularly noted their unanimous and unsolicited praise for the work done by the civil defence college group that appeared so promptly on the scene. I gathered that this group, among other accomplishments, gave the shattered inhabitants a feeling that amongst disaster a foundation was being established for them from which to hold on to reality again.
As a rule, I am not a letter writer, but the reaction of these people was so favourable to the work of your organization that I thought that perhaps you, your staff and students might be interested in receiving these comments from a disinterested source when all too frequently your efforts are apparently received with apathy by the public.
Yours very truly
Ewan R. Caldwell


Paul Joseph James Martin: I hope the minister will not resent my saying that this has indeed been a most disappointing statement if this is all that the minister intends to say on the matter of civil defence.


Jay Waldo Monteith: May I interrupt one moment, Mr. Chairman, before the hon. member goes on further in this particular vein. I did have quite a lengthy statement prepared. But here again, as I expressed myself when my first item of estimates was before the committee I felt that the special circumstances of the situation that exist today call for me to abbreviate my statement somewhat. If there are any questions to be asked I should be glad to answer them and to give a detailed answer in every respect.


Paul Joseph James Martin: Notwithstanding the qualification made by the minister I must say that I think that what he has said so far is extremely disappointing. I was about to observe that it may be that the division of responsibility in four departments


of government and the fact that the Minister of National Defence will be the spokesman in the matter of civil defence puts the minister in a rather difficult position. He spoke of shelters and he spoke of some of the achievements of the civil defence college. But not a word was said about evacuation; not a word was said about whether there is to be a co-ordinator in his own department; not a word was said about his own concept of the role of the army or about the extent of the participation by the province. It is true that a reference was made to the necessity of individual citizen participation but there was no indication of where the army would step in whether it would continue to have an over-all authority, whether the civil power would have the overall authority over the armed forces or whether the situation is as I now believe it to be-although the minister did not indicate it-that in stricken areas the primary responsibility will be that of the army with power to call on the welfare services, hospital services and the like.
All these things are matters which are essential to an understanding of the details of the kind of policy announced by the Prime Minister in May and referred to by him a few moments ago in the adjustments that he made. This government has been in office now for two years. I fully appreciate the difficulty of the problem. It is an extremely difficult one. No matter who is in charge, will not be able to meet all the suggestions that are made as to what should be done in the matter of civil defence.
I know the difficulty of the government and the difficulties of the minister and his colleagues who will be involved in this matter. We are living at a time when we are spending on a national defence something less than $2 billion. We all realize that in the event of war-something that we all hope will not eventuate, but nevertheless having in mind what General Norstad talked about the other day, namely the possibility of mistake- we must think of the effect of this on the civilian population.
Are we now decided that we must take an awful risk? Are we to take the position that nothing really can be done? Are we to abandon the possibilities of evacuation because of the new phase that we are now in as compared with the situation which prevailed in 1953? I would have been happy to know exactly what is going to be the role of the army. I would like to know what would be the relation of the army to the civil power. At the present time the primary authority rests with the civil power who may under the Militia Act call upon the use of

the armed forces which could be, through a departmental arrangement, put at the disposal of the civil defence authorities.
These are questions which parliament certainly has not been informed about. The provinces may have been told about them, but we certainly were given no indication of what went on at the meeting with the provinces a month ago. There is to be a meeting in October, and that will follow the transfer of ministerial responsibilities on September 1. What is going to be discussed at that meeting? I believe that it would have been advisable for the government to give to the public at once, or at least at the earliest possible moment, the report which was made by General Graham. The minister at one time indicated, I thought, that he would make that report available, and then he took the position later that it was a privileged document, prepared while General Graham was still serving in some capacity in the government service, and on that account it was not in the public interest to make it known.
There are exceptions to privileged documents, and if General Graham, who had made a tour throughout the country and talked to civil defence people and examined the situation from every angle, had positive views, those views contained in that report should have been made available to this parliament. If the government persisted in not making it available, then I think the minister at some time earlier in the session should have given us the broad outlines of the government's reaction to the recommendations contained in that report. The minister was invited by me on at least four occasions during this session to give a statement to the house on civil defence, but I was reminded every time by the minister that that would be done in due course. I think his favourite phrase was, "High priority is being given to these things." I am sure he will agree with me that "high priority" did not mean high information, and the result is that we do not know tonight any more than we did a year and a half ago what the government's policy in the matter of civil defence is.
We do know that there is going to be a new distribution of functions. We do know there is going to be one minister who will have the responsibility of announcing policy and of playing the role of co-ordination; but beyond that I submit to the minister, with respect and with understanding of his difficulties, that whoever is to blame we are no further advanced as to what the government policy is in civil defence matters. We know that the government will pay a little more to the municipalities, but I am not talking
Supply-Health and Welfare about that. I am talking about the kind of attitude the government takes about the importance of civil defence.
What steps can be taken to protect the individual in the face not only of the manned interceptor but the I.C.B.M. and the like? What can be done to mitigate the dangers of radiation? The minister spoke of shelters and that these are now within the economic reach of the average citizen. I point out to him that there are studies in his department which will show that this was available two years ago. They show that shelters could be built at an economic level which would not be burdensome on a great number of individuals in Canada. Now the minister says that a further study is being made of this phase of the problem.
In the state of New York they have arrived at a decision on this matter. The governor of New York has a definite view as to what can be done by way of individual shelters, and I do not know how valuable this further study is going to be. If the minister feels in the light of his special knowledge that there must be further study made about the uses of private shelters, one cannot quarrel with him; but if there is going to be a study as to the feasibility and economical circumstances attending shelters, what is the government's policy? Is it going to build shelters? Is it going to make these available to the public in certain concentrated areas, or are individuals expected to build these shelters themselves? Is there going to be any requirement made by the government as to shelters in public buildings? Is there going to be any suggestion made to the provinces that in respect of matters coming within their constitutional competence they should take steps to see to it that shelters are provided, perhaps even as a matter of compulsion as is thought of in New York?
These are the kind of matters that the minister has not spoken about to the house. I know he will find it very difficult to give a comprehensive statement tonight because of the great and absorbing interest of all members in this subject at the present time. I fully realize that, but I can say to the minister that if that is the situation it is because the government did not take advantage early in this session of announcing its new look in the matter of civil defence. I hope the minister will not take amiss what I say. I do not blame him entirely for this, but because he is the minister of the moment who is shouldered now with the responsibility in so far as his estimates are concerned, I do not know to whom else I can throw my dart.

Supply-Health and Welfare


Mr. Winch:: Mr. Chairman, it was my understanding that an agreement had been reached by all parties of the committee on the date of prorogation, and the time. Every member in this committee has the right to speak as often and as long as he wants, and in view of the fact that apparently we are now a long way behind our schedule-


Mr. Fleming (Eglinion):: No.


Harold Edward Winch: Yes we are-I would like to suggest that if there are party members who feel they have so many things on their chests which they have to get off, then I would like to ask if perhaps now is not the time to set a new target date unless those who reached the agreement abide by it.


Laurier Arthur Régnier: Mr. Chairman, I cannot let the opportunity go by without speaking on the matter of civil defence. The point I am interested in is human survival. I have been listening to the Prime Minister and the Minister of National Health and Welfare, and I have had a lot of satisfaction in the knowledge that they have been thinking about this problem. According to the Prime Minister's statement we have at least one shelter, and that is the government. But I am a bit surprised by the hon. member for Essex East in the way he talks now about action, shelters and so on, when on August 31, 1955 government experts were here in Canada, one coming from NATO, and a Dr. Alvin Groves from Nevada, and others, when they pointed out to the government of that day that the time to act was now, and now was August 31, 1955. However, when they left office they had done nothing at all.
I am also delighted that the minister talked about shelters and not about evacuation. I do not believe in evacuation, because there will not be time for it. I still remember the occasion of a terrible snow storm in Winnipeg on November 18, 1958 when schools were closed and funerals were cancelled. Where could we have gone that day if an attack had come? There was no way of leaving Winnipeg.
I have in my hand a map of the city of Winnipeg and surrounding district taken from the Winnipeg telephone book. The map outlines civil defence rules and illustrates points of evacuation for each area. The people of the municipality of St. Vital, a community of over 20,000 persons, are directed to go to St. Pierre where there are not more than about 200 homes. How could 20,000 people be accommodated there? This community is approximately 35 to 40 miles away which would not be far enough and is east of Winnipeg, the direction of the prevailing winds.


Following the testing of a nuclear bomb in 1954 it was stated by an eminent professor that radiation contamination would extend 200 miles distant from the central point which would cover an area 20 miles wide. It would be impossible to escape a bomb. A shelter on the site of a dwelling is required. We do not know where the bombs will fall. If you were in a shelter 10 or 15 miles from the point at which the bomb fell you might be safe.
I believe we should encourage every Canadian householder to have his own shelter, and these should be not too expensive. They should be suitable for use in civilian life to store preserves or canned goods or for use as a root house. We may have to live in such shelters for a few days in the event of attack.
Russia may attack in winter. It must be remembered that Russia won the battle of 1812 in large part because of cold weather. Perhaps Hitler's defeat by Russia was due more to cold weather than to Russian arms because frozen soldiers are not capable of fighting with success.
Notwithstanding the great advances made in civil defence I feel a certain degree of apprehension about the situation in the country. Canada should follow the plan adopted by Sweden. That country has spent more than $200 million on shelters and civil defence. Every person in Sweden knows where he is to go in the event of war and even knows the house in which he will be billeted. Civil defence training is compulsory in that country. In view of the danger that is facing us we should resort almost to conscription in order to defend ourselves.
I have received a letter drawing to my attention an article of some interest on this subject entitled "Washington through Canadian Eyes" and bearing date July 7, 1959. It reads, in part, as follows:
In case you missed it, a congressional committee has unveiled the gruesome details of what a nuclear attack on the United States would mean: 50 million or more dead, fire storms such as the world has never seen, 20 million seriously injured, most cities reduced to rubble, etc., ad nauseum.
But interesting for Canada is the fallout pattern from the southeastern corner of British Columbia, also probably catching Calgary, roaring over the Niagara peninsula and cutting through the industrial heart of Canada, through Windsor, Hamilton, Toronto, hitting Montreal and much of Quebec and swooshing through New Brunswick. Canadian cities close to the United States border, like Windsor, would likely be destroyed.
Presumably the North American air defence would be able to shoot down some of the vehicles (manned bombers or ICBM's) carrying the nuclear bombs, thus having them descend on Canadian cities and towns with unpleasant results for us.
The one clear point made during the hearing: civil defence measures could save millions of Canadian fives. The human race is not going to be wiped out by a nuclear war, and if there are

enough bomb shelters and other civil defence equipment available, several million Canadians might be saved from nuclear death. Public apathy caused by the overwhelming enormity of the concept of nuclear war is the greatest obstacle to overcome.
I agree with that statement. Public apathy is indeed the greatest obstacle to overcome and I might say parliamentary apathy must also be overcome. I have not heard a worthwhile speech from members of the Liberal party or the C.C.F. group on this subject. We must realize the danger confronting us and acquaint the public with the full facts of the situation. The Canadian people require leadership. We must bring home to the people the seriousness of the situation. The money spent on civil defence would then be willingly contributed to by the taxpayers.


Mr. Weichel:: Mr. Chairman, I am sorry to come in at this time but for some months I have had some comments prepared relating to these estimates and I shall detain the committee as briefly as possible.
In rising to speak on the civil defence items in the 1959-60 estimates of the Department of National Health and Welfare, I want to compliment the Minister on the progress he has been making since civil defence has been assigned to him and, in particular, on the co-operation he has been able to receive from the provincial governments. Much of this is due, I feel, to the minister's practice of taking provinces into partnership by calling them in for conferences with him. He has had conferences with the provincial civil defence ministers last October and again in April this year, the first time the provinces have been called in to Ottawa on civil defence problems since 1954. My understanding is that a third conference, when the new reorganization is complete, is scheduled for this autumn in a continuation of this general policy of achieving a thorough understanding with our provincial partners.
In reading over the new proposals I note with particular interest that one of the existing peacetime emergency services which the army would direct in such damaged areas where they are commanding re-entry operations is the provincial and municipal fire services. This is of particular interest to me as only a few weeks ago I was at the head table of the annual banquet of the firefighters' union in the province of Ontario which was held in my riding's largest city, Kitchener. I am very proud of the fact that my county of Waterloo has long been one of the leaders in civil defence and particularly in fire civil defence. My home county of Waterloo, which comprises three cities and Preston, was the first county in all of Canada where the fire departments in
Supply-Health and Welfare the entire county are united in one shortwave radio network where the dominant city's fire department can sound the sirens and call out the firefighters in every municipality in the entire county by using their shortwave radio network system, and so unite all the fire departments in any fire emergency to work under one unified radio command. Seventeen fire departments with over 400 firefighters are organized in this Waterloo county mutual fire aid plan. It is so well developed, under the leadership of Fire Chief Kenneth Putnam of Kitchener, who is also this year's president of the CAFC, that they have their own county fire training grounds and an active educational and social organization that meets monthly.
The co-operation that civil defence has received from the county of Waterloo is typical of the co-operation the minister receives from the Ontario government which has developed the largest civil defence organization in any province in Canada.
Let me summarize my views on the reorganization of civil defence as announced in this house a few weeks ago by the Prime Minister, and followed by the recently published civil defence order of 1959, namely 656. I think the new proposal makes sense. Under this Canada should look forward to a sensible and realistic organization of our people to meet an emergency we all hope we will never have to face.


Mr. Peters:: I should like to say a few words on this matter as I think it is a very important subject. I was surprised that the minister did not ask for permission to table the full text of his presentation because I think it is very important that we do know exactly where we are going in this matter of civil defence and of the change that has been made in it. I was also surprised to note he said that before 1953 the attitude was against evacuation and now it is toward evacuation. I should like to ask him how he thinks we are going to evacuate even a city the size of Ottawa when we cannot even get the traffic out of the city for several hours at rush hour periods? Therefore, evacuation seems to me to be an impossible situation. I think the civil defence department should work from the knowledge that we cannot evacuate a major city. If anybody doubts that all he needs to do is to go down to Wellington street at 5.30 at night and see for himself or go to Yonge street in Toronto at 5.30 at night and have a look at the situation. I think it is a physical impossibility to evacuate. These are people who are walking out of their offices and getting into cars. Just imagine what would happen if some woman wants to take a budgie bird

Supply-Health and Welfare or someone else wants to take a goldfish, or bedding and other personal belongings. Evacuation is an impossibility, I think.
Civil defence may have worked all right. There has been a great deal of credit given to the leadership that has been supplied at Arnprior in the civil defence school. I know many of the people who have taken the courses and they have been very impressed with the training that they received. The government has failed to give leadership in deciding what civil defence itself is going to do. I know many important people in communities in my area who have volunteered to assist in civil defence and have been very disillusioned and dissatisfied with the opportunities they get for doing anything that is constructive or anything that appears to them to be worth while. Though they are willing to give up their time on a voluntary basis, they are very often, in a very short time, disillusioned with the orders and the multitude of directions and instructions that come from all sorts of places, and they are never sure just who runs it, who is responsible for it and where it is going. Under the system that has been devised and outlined tonight I think they are going to be even more confused because the heads of the various departments from whom they are going to take direction are going to be divided again into a number of departments.
This civil defence matter is much more important to the Canadian people than the defence department itself will be or could be. In case of an attack Canada is not going to be defended. We should face the fact that we cannot defend. If we do this, then we have to face the fact that we should try to do something to help the poor people who are going to be left in what many consider to be a defenceless position. This is going to take a good deal of study if we are to save even that half of the population that the hon. member for Port Arthur said may exist after a bomb is dropped and the radiation has finally settled.
The department should look very closely at some of the other agencies that have been very active and very helpful in cases of disaster. I am referring particularly to the experience that was gained in the city of Toronto at the time of hurricane Hazel. They found there that the civil defence organization, although it was very young, was of very little use. They found that the army was of absolutely no use at all. The other services were in the same category, no use; but they did find that two organizations which were not expected to be involved were of a great deal of value. One of them was the Bell Telephone Company and the other was


Hydro. Without going into the details, the officials who were connected with civil defence at that time pointed out that they were operated in such a way that there was an individual responsible for a unit. They could move the unit around themselves; whereas the army was a unit to start with and it was very hard to break it down and to delegate responsibility; once an order was given, then that order was carried out and that was that. But with these other organizations that are built up on a truck unit or a very small unit basis, they could expand into a very large group under the authority of the person responsible for the original unit.
This matter should be given very close consideration. The minister should put out a direction. If he cannot do it by tabling the brief that he had prepared, then he should make available the much more comprehensive document that has already appeared on this subject, so that again the people in the small communities, the leadership that is being given from the civic point of view, will again be enticed into the civil defence organzation and be again in a position where they wll be of some help in this organization and continue to do the work that is going to be absolutely necesary if civil defence is going to be of any success at all.


[Stage Direction]
Item agreed to.
Charles Edward Rea: This completes the estimates of the Department of National Health and Welfare. The committee will now take up the estimates of the Department of Finance.
DEPARTMENT OP FINANCE General administration-
106. Departmental administration, $2,461,599.


William Hector McMillan: Is the minister going to make a statement?


Donald Methuen Fleming: Mr. Chairman, I think there is no occasion for any statement on the part of the minister. All questions pertaining to matters of policy related to the Department of Finance, I think, have been discussed during the course of this present session on many occasions; indeed to the point where I think they are-


Lionel Chevrier: Threadbare.


Donald Methuen Fleming: "Threadbare" is the word. I said that on a previous occasion, Mr. Chairman. Therefore, I will simply content myself with the observation that I am asking the committee to approve estimates of this department totalling $1,261,434,605 in the main estimates and $5,155,000 in the supplementary estimates.

Of this amount the overwhelming bulk is, of course, of a statutory nature, namely $1,172,264,701.


William Hector McMillan: Mr. Chairman, I agree with the minister that we have discussed a good many of these items within this fiscal year in one way or another, and certainly I can assure the committee that I want to be brief and I have not the heart tonight to excite the minister to give us another three-hour talk.


Donald Methuen Fleming: You could not even pay me to do it tonight.


Lionel Chevrier: I am glad to hear that.


William Hector McMillan: I just want to say a very few words. I always come back to the conversion loan. At the time of the conversion loan I predicted that the taxgatherer would be around for a generation. The estimates of the Department of Finance are the first evidence that we have had that that is so in connection with federal government spending. There is an increase of $106 million to service the national debt this year and this is bound to be followed next year by another large increase not only because of the increase in debt alone but because of the increase in the cost of money to the government.
The minister has referred to the different talks I have given as doom and gloom, and tonight the references I make to my previous statements will be brief. I will quote some of the minister's statements and I am sure he can take no objection to them as they are quite optimistic.
I want to refer briefly to the conversion loan. Whether or not the government likes it, I think that loan has been responsible largely for shaping the monetary policy of the government since that time. We all know about the conversion loan. I will not pretend to deal with it except to say that I have one vivid recollection of a $10,000 bond being converted and costing the taxpayers of Canada $350 including, of course, $51 in accrued interest to change this one 3 per cent bond to a 4J per cent bond. We know that at the time $6.4 billion of victory bonds were to be converted into two short term bonds and two long term bonds, but in spite of the greater inducement only a little over half of these bonds were converted into long term bonds and slightly under half into short term bonds. I think some of the short term bonds will embarrass the government in many cases more than if the conversion loan had never taken place.
Supply-Finance
We all know about the cost of the conversion loan. I made some predictions at that time and I should like to quote one from Hansard:
Dominion government bonds are the senior security and they set the pattern for other bonds. Certainly our provinces, our counties and our municipalities will have to pay a higher interest rate than formerly for their borrowings for roads, schools and other services.
We all know that interest rates have gone up for the provinces and the municipalities. What did the minister say at that time? He made a long speech on September 4. I have five quotations here but I will just give two of them. As found on page 4598 of Hansard he said:
As to the provinces and municipalities, in their borrowing operations they will derive the full benefit from these constructive results of the Canada conversion loan.
Again, on the same day he said as found on page 4593 of Hansard:
Mr. Chairman, I am thankful to say that we have stabilized the Canadian bond market.
I know that the minister made a good many predictions on that day. I think I counted some 20 or 30 and I should like to challenge the minister to name at least one or two that have come true. To help to justify the conversion loan to the committee of supply on September 4, 1958 the minister gave us a considerable list of those who had converted their bonds. He gave a list of the provinces. For instance, he said that Alberta had converted $69 million, Manitoba $25J million, Ontario $69J million, Quebec $2 million and Nova Scotia $21 million. Concerning New Brunswick the minister said, as found at page 4600 of Hansard:
New Brunswick, with various provincial accounts, holds a total of $6,743,000 of victory bonds, and that grand province of New Brunswick converted all of its holdings of Canada victory bonds into the conversion loan.
I wonder what the grand old province thinks about that now with a loss possibly up to 10 per cent of that amount. If we take all these provinces and add the amounts together we find that these provinces are down, so far as market value is concerned, between $15 million and $20 million. I met a person from New York and he said that the market was down so much he was frozen right into the market and could not get out. That is true of our provinces. They are frozen right into the bond market and cannot get out unless they take a loss.
There is just one other thing I want to say and I want to co-operate in getting along with the business of the house. The other day I heard the minister say in the debate having to do with Newfoundland that hon. members

Supply-Finance
on this side of the house should read the press. He emphasized that on two or three occasions.


Donald Methuen Fleming: I did not make any such statement.


William Hector McMillan: I should like to ask him to read the press himself. 1 have some press clippings here and I am going to read the
headlines. I have the Halifax Chronicle-Herald of May 25, 1958, with the headline, "Confusion In Financial Policy"; the Hamilton Spectator of May 2, 1959, "No Easy Path Back to Sanity"; the Financial Times of May 8, 1959, "Does Mr. Fleming Not Know Better"; the Lethbridge Herald of May 5, 1959, "Tight Tory Money"; the Winnipeg Free Press of May 12, 1959, "The Result of Tory Financial Mismanagement"; the Toronto Globe of December 31,	1959, "12
Months of Mystery", and the Toronto Globe of May 15, 1959, "Oh Mr. Fleming". That last headline appears over the column "Looking Into Business" in which the writer. Mr. Fraser Robertson, says:
The unhappy part about Mr. Fleming's vacillation is that it is all unnecessary. There is no reason for his half-truths about the financial situation.
I have never gone that far. I would not use the word "half-truth" because I know it is unparliamentary. In fact, I would not use it in any event but I have said that in the house he has continually compared apples with oranges. I think the fiscal policy of the government is made up of two phases. The first phase was the conversion loan as a result of which the people lost confidence in the fiscal policy of the government. The second phase concerns the effort of the government to extricate itself from the trouble.
What effort is the minister making to get out of this trouble? He has increased taxes by $352 million. He has issued a lot of short term loans and each successive loan has a higher interest rate than the previous one. We know that some of these loans return to people with incomes taxable at a level of 50 per cent or over at least the equivalent of 8 per cent or more if they have bought bonds at par. That is what the government has done for the rich people. What has it done for the poor people? At Brantford on February 17, 1958, the Prime Minister said:
The humblest of our people will not be forgotten.
They certainly have not been forgotten. They are being charged more excise taxes, more taxes on their cigarettes and more on their beer.


Donald Methuen Fleming: No change on beer.


William Hector McMillan: If they work and pay unemployment insurance they are paying more than their fair share to take care of

the depletion in the unemployment insurance account. I do not think there is any doubt about that.
What has been the result of the loss of confidence in our fiscal policy? Our bonds are selling among the lowest of those of the western free world. I said before that they were selling lower than those of Cuba but since the prime minister of Cuba has resigned their bonds have gone down as low as ours. Our bonds are selling lower in many cases than provincial and provincial guaranteed bonds. I put that on record not very long ago. We have a condition in Canada where the farmer and the corner grocery store owner can go to a bank and get money cheaper than the Dominion of Canada on some of its borrowings. This is forcing our provinces and utilities to borrow money in New York, thereby helping to maintain the premium on our dollar, which makes conditions bad for our exporters.
As I predicted, it has raised interest rates not only to the federal government but to the provinces and municipalities. It has increased the cost of living and the cost of production at a time when it is difficult for Canadian producers to get into the markets of the world.
I would appeal to the minister to listen to some of the things in the press to which he should listen. I would appeal to him to take some of the advice of the financial men who this last year have taken the attitude that the best way to help our provinces and municipalities is to help ourselves by getting our finances in better shape here. If we do, we will reduce interest rates in this country and we will thereby reduce interest rates for our municipalities and provinces.


Herbert Wilfred Herridge: Mr. Chairman, I spent some considerable time preparing what I thought was a rather good 30-minute speech on this departmental administration item. Here is the result of it. Self-sacrificing as I am, I am going to lay it aside. In view of the time factor and our general desire to get through this session this evening, I am simply going to bring to the attention of the committee that our party's policy with respect to finance was presented to the house on January 29 by the hon. member for Timiskaming in which he dealt with the problem of inflation, with which the hon. member for Welland has just been dealing. Again, in seeking supply, the C.C.F. policy with respect to this question was stated.
I must say, Mr. Chairman, I had looked forward to the opportunity of informing the committee and the minister, advising the minister, and I trust everyone will appreciate what we are doing for the sake of advancing

our business this evening. Having said that, I will have some comments to make on the various items as they come before the house.


Lester Bowles Pearson: The minister, I understand, said a few moments ago that in the course of this session he has said, everything on these matters that needed to be said. I hope I am not misquoting him. He said a great deal, and we appreciate the information he has given us, but I doubt very much that he has said everything that needed to be said. I do realize, as my hon. friend who preceded me realizes, that this perhaps is not the most propitious time to make a long speech on the financial and economic situation that confronts us now, even though the general item for the Department of Finance is the appropriate occasion to do that.
However, I do not want this session to end without giving the minister one or two further opportunities to interject "Nonsense" or "Rubbish", so I hope he will forgive me if I make a few remarks on the general financial picture. There is no doubt the country is facing serious economic problems: Unemployment still remains high, in spite of the seasonal improvement and the seasonal improvement will soon be coming to an end; increasing prices; the threat, at least, of inflation; a large government deficit and increasing public debt; scarcity at the present time of mortgage money; a reduction in housing construction; tight money, if I may use that expression, with unprecedented levels of interest rates; and a depressed bond market.
I do not want to prolong this discussion by referring to all these serious problems because that would take a great deal of time, but I do express the hope that they will receive and continue to receive most careful and continuing attention of the government, and that some effective solution can be found. Otherwise, when parliament meets again, we on this side will certainly be fully justified in criticizing the government for its failure to meet these problems. However, I do want to refer, and it will only be for a very few minutes, to one or two specific problems with which perhaps the minister might be good enough to deal.
The first is the money supply. The money supply, as the minister knows, reached a peak in October, 1958, I think it was, after the conversion loan and then, for a time, there was a reduction. But recently it has been on the rise again and a new peak has, I believe, been reached. The money supply has increased since May 27 by about $140 million. If that trend continues there would indeed be more than a danger of inflation.
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There might, indeed, be the reality of inflation especially when we approach a condition of full employment, and it is the prediction of the government that we are approaching a condition of full employment. If this money supply keeps on increasing the inevitable result, I suggest, will be inflation. We will be watching, on this side, very carefully what happens on this front during the next few months.
Perhaps I might say a word about the debt position of the government. The situation in that respect is I believe worrisome and, I think, worsening. At the end of June, 1958 Canada had a record total debt for all time of $4,800 million due in two years or less. That, I suppose, was the real reason for the conversion loan of the summer of 1958, to stretch out that debt. Assuming, Mr. Chairman, there are no cash bond issues, that the October maturity is rolled over into a two-year or shorter bond and that all maturing bills are rolled over and that the current six months bill cycle is completed, we will again, I believe, have a record short term debt at the beginning of next December when $1,021 million in 3 per cents due in December 1961, will become less than two years in term. At that time, next December, if my calculations are correct and on the assumptions I have made the total debt under two years might be of the order of $5,800 million, which would be $1 billion more than that which existed just before the conversion loan.
The question naturally arises, therefore, what is the government going to do about it? Are we likely to have another conversion loan? Perhaps the minister, even at this late moment of the session, will take us into his confidence, at least in a general way, and tell us how the government proposes to cope with this very serious problem.
Then, Mr. Chairman, there is this tight money situation. I often like to call it a dear money situation, but I have been told I should not do that because there is a suggestion of affection about the word "dear". This is a subject on which the minister was very excited when he was in opposition. I have just ventured to point out the dangers of the increasing money supply as we proceed on the road to recovery. I hope the minister will not deny, as it seems to me he has tended to do, that we are now suffering from tight money conditions. All objective and independent observers, it seems to me, have recognized this condition. The minister, more than once, has denied that these conditions exist or that they are comparable to the conditions about which he used to talk when he was referring to tight money in 1957.

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Then, it seems to me somewhat illogically, he argued that if they do exist they are not really the fault of the government because they are not matters of government policy; that the government turns the responsibility in these mattters over to the banks.
On this subject, may I bring to the minister's attention-and these will be my concluding observations-an extremely interesting article which perhaps he has already seen and which appeared in a United States magazine entitled Business Week of June 20, 1959. I should like to quote just a couple of paragraphs from that article. The first is as follows:
-interest rates in both Canada and the U.S. are high and trending higher. In both cases it is a reflection of tightening money and anticipation of even tighter money in the future.
Both countries face the same problem. But the "tight money" issue is closer to coming to a head in Canada than it is in the U.S.
Then it goes on to state:
In Canada, where no ceiling prevails,-
That is on interest rates or government bond interest rates.
-few experts think that the government could sell a long-term issue even if the rate was above the market. So the problem facing Prime Minister John Diefenbaker's government is already acute.
Then these two paragraphs:
This week, on Toronto's Bay street-which vies with Montreal's St. James street for the role of Canada's Wall street-financial men were freely predicting that short-term rates would break through 6 per cent. Some pessimists think that rates are sure to break through the height barrier reached in 1920, when Canadian bonds were yielding over 61 per cent.
The big question is whether high interest rates and scarcity of credit will impede Canada's remarkable growth rate which, up until 1957, outpaced the U.S. But the 1957-58 recession hit harder and lasted longer in Canada and now, despite the fact that unemployment is over 5 per cent, money is not only expensive but increasingly scarce.
Those are one or two aspects of the financial picture-and they are only a few and I have touched on them very briefly-which even in the circumstances of the closing of the session I venture to bring to the attention of the minister in the hope that perhaps he may give us a word of assurance in connection with them.


Lionel Chevrier: I am delighted that the Minister of Finance indicated earlier that he is in no mood to make a long speech on the consideration of his estimates on what we hope is the final day of the session. In what I have to say I shall attempt to be as nonprovocative as possible. I can assure the minister and my delightful friend the Minister without Portfolio, the hon. member for Greenwood, who used to speak from this side of the house with such kindness but

also with such effectiveness that I will not attempt at this late hour of the session to interject a note which will at least bring about a heated reply from my hon. friend across the way. However, I feel that there are certain matters-one in particular-which I should like to discuss and I shall do so briefly. It has to do with university grants, a matter with which I am sure the minister is not totally unconversant.


Donald Methuen Fleming: Would my friend be willing to reserve his remarks until we reach that particular item? In this way I suggest that we would avoid a discursive debate. We have in the estimates an item dealing specifically with that matter.


Lionel Chevrier: I know there is a specific item which I have read very carefully. I hesitate to refuse to accept the ministers' suggestion but I feel that these remarks, which may perhaps go beyond the scope of the specific item, would be better discussed on this item.
The question of federal grants to universities, as the minister knows, was raised again during the last electoral campaign and the great majority of the Conservative candidates in Quebec stated that those grants were unconstitutional. They went a step further and said that if they were elected such a violation of the constitution would cease.
I should like to analyse for a moment what has happened since then in this respect. The Conservative government, wisely I believe, has not only continued federal assistance to universities but it has increased them and it is still using the formula proposed by Mr. St. Laurent in 1956. Moreover, the Minister of Finance has at no time indicated his intention to change that formula or to abandon that program. He merely stated in the house last year that if the premier of the province of Quebec, Mr. Duplessis, had any suggestions to make or any proposals to make, he was ready and willing to hear them, to consider them and to study them. Mr. Duplessis has never made any precise proposals in the past and nothing happened in this respect during the last year.
As the house knows, federal grants were not discussed at the federal provincial meeting of November, 1957 and, according to the Minister of Finance's own admission recently, that matter was not even mentioned at the last meeting of finance ministers held in Ottawa in July. As far as the government is concerned, therefore, this important matter is considered as being settled. The Minister of Finance is not prepared to take the initiative and try to find an alternative formula -and I cannot direct any blame at him for

that fact-and Mr. Duplessis, on the other hand, judging from past experience, will not present new proposals.
The problem remains, however, and the solemn promises made by the followers of the Minister of Finance in the province of Quebec are not yet fulfilled. They are trying their best now to forget the commitments they gave during the last campaign and I am told that they are prepared to support federal grants to universities on the basis of the St. Laurent formula, as they did last year in this house. We all remember very well, of course, that all the Quebec Conservative members who were present in the house last year, including the hon. member for Quebec East and the member for Belle-chasse, voted in favour of those grants to universities. To show how inconsistent their position is, most of them refused this year to support federal contributions for the construction of the trans-Canada highway. They voted in favour of federal grants to universities, which not long ago they claimed were unconstitutional, but they do not accept federal grants for the construction of the trans-Canada highway, on the ground that such federal assistance is a menace to provincial autonomy and to the French Canadian culture.
This is not, however, the only inconsistency that they have shown. During the present session the hon. member for Belle-chasse, who I am sure would not deny his position as one of Mr. Duplessis's spokesmen in this house, explained his attitude on federal grants to universities. He re-stated his former position that such grants were unconstitutional, that they were a violation of our constitution. For those who want to look at it, it can be found at page 2947 of Hansard. But having said that- and immediately I admit that he is entitled to his own opinion, as is any other hon. member of this house, and he is entitled to place his own personal interpretation on the constitution-he went on to explain why last year he had voted in favour of those grants. He said this and I quote: (Translation):
To that, as far as I am concerned, I reply that, being a federal member, I could not afford to ignore the nine other provinces which had raised no objection in principle and felt no inconvenience of a regional nature in accepting the grants. I could not afford to ignore the fact that the universities and colleges of those provinces had drawn up their budget and their development projects in the light of the precedent of 1952, which has been firmly established ever since. Nor could I afford to ignore that, in those provinces and within those colleges and universities there are fellow compatriots of mine, of the same origin as my own, who have derived and still are deriving from those grants, unquestionable benefits without which they would
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have found it difficult to insure the survival of their institutions of higher learning. Nor could I afford to ignore that, among the ten provinces of the confederation, there are some which, unfortunately, are not financially in a position to provide for the maintenance and development of their own institutions of higher learning.
That is the end of the quotation, which may be found on page 2947 of Hansard for April 22, 1959, English version.
(Text):
So, sir, in attempting to explain his attitude the hon. member was also attempting to justify the position of all his Quebec colleagues who like him last year voted in favour of federal grants to universities. This statement is a most inconsistent and dangerous position to take for so-called champions of provincial automony and defenders of the constitution. In effect they say this. What the federal government is doing in this respect is clearly a violation of the constitution, and the province of Quebec is against it and we will support that measure because the nine other provinces are not opposed to such federal assistance.
In other words, the position of those Quebec Conservative members can be summarized by the following proposition: We from the province of Quebec accept and support a clear violation of the constitution of our country if the nine other provinces do not object to that violation. Is this the way the Quebec Conservative members intend to defend what they think is a clear provision of our constitution? If it is, then they are the most dangerous enemies of provincial autonomy and of our constitution.
But this is not the whole story. Having accepted that the constitution might be violated in this respect in so far as the nine provinces are concerned, they ask for a special deal for Quebec which would take the form of an unconditional subsidy to the provincial government in lieu of the present federal grants to universities. The Minister of Finance would find it difficult to refuse such a proposal because of the peculiar interpretation he gave in his budget speech to federal grants to universities. At page 2410 of Hansard he presented a table showing federal contributions to the provinces, and he included university grants in that table. For the Minister of Finance, therefore, university grants are a federal contribution to the provinces.
If this is the purpose of such grants-as far as I am concerned I do not think so-then why not give that kind of assistance directly to the provinces? To say, as the Minister of Finance did, that federal grants to universities are intended to help the provinces, is stating

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a very dangerous principle. Indeed, if those grants are interpreted in this way, why then should federal assistance be limited or restricted to universities? Why not give additional help to the provinces by offering federal grants to secondary and primary education or to secondary and primary schools? As can readily be seen, as soon as university grants are interpreted as a financial contribution to the provinces, there is then no valid reason to stop there and to refuse federal assistance to the other levels of teaching institutions. The Minister of Finance may not have fully realized the dangerous interpretation of the statement or the table which was placed on Hansard, and also the dangerous implications of the interpretation which he gave to university grants in his budget speech. He has opened the way for federal assistance to all levels of education in Canada, and I hope that he will find it possible today to clarify his position in that respect.
As far as I am concerned, and I am sure not to be the only one on this side of the house to find myself in this position, I cannot accept that interpretation of federal grants to universities. I cannot accept that interpretation because it would justify federal assistance to secondary and primary schools. I want to make it very clear that I am and always will be strongly opposed to such federal grants. The attitude of the Liberal party concerning university grants is very clear and it has been consistent all along the line, not only from the time the formula submitted by Mr. St. Laurent was established, but earlier. We do not say in Quebec that the grants are unconstitutional and in the rest of Canada that they will be continued and increased. Since they were established in 1951 we have always said that such grants were constitutional.
I do not intend to discuss the issue here; I merely want to say to those who sincerely, I am sure, claim that those grants constitute a violation of our constitution that they have only one honourable course to follow, and it is this. They must state their opposition to this budgetary item in most vigorous terms. They must vote against it and they must use every means at their disposal, including a reference to the courts, in order to stop that violation. There is no acceptable alternative available to them if they want to be consistent and to safeguard their honour. They cannot claim that those grants are violating the constitution and at the same time vote for them because nine provinces want them.
However, the Liberal party has never viewed university grants as a federal contribution to the provinces. This system of

grants was established as a direct compensation to Canadian universities for the national and international role that they are called upon to play and which greatly benefits the nation as a whole and the federal government itself. This has been and should remain the sole purpose of federal aid to universities, which is to compensate them for the national and international role they exercise and to enable them to fulfil the essential functions in a more efficient manner.
It is most important, it seems to me, to keep this national purpose in mind because it imposes three definite features of federal action in this general field. In the first place it indicates that federal grants to universities should remain a supplement in university budgets compared with provincial grants, because the main function of universities is exercised at the regional and provincial levels. In the second place, while university grants serve a specific national purpose, there is no such specific purpose to justify federal grants to secondary and primary schools. In the third place, there would be no guarantee that this national purpose-that is, the financial compensation for the national and international role of universities-would be served if additional unconditional subsidies were given to provincial governments in lieu of federal grants to universities.
It is quite evident that federal aid to universities is still an unsolved issue in the province of Quebec and that we should all try to find an acceptable solution. By the end of 1959 the national conference of Canadian universities will hold in trust for Quebec universities the large sum of $24 million, or approximately that amount. This is a very important and impressive sum indeed, and while Quebec universities have not yet lost that financial assistance, they have not been able to use that money and their progress and development has been hampered on account of that as well as being delayed. This is, therefore, a very important issue.
In attempting to find a solution, however, we should remember the three features that I mentioned a moment ago and which any federal scheme of assistance in this field should retain in order to preserve the national or dominion purpose which was at the origin of that program.
By the way, the hon. member for Quebec South, in an interview reported by the Montreal Gazette of September 9,	1958
recognized this dominion purpose and the national role played by universities when he said:
However, Quebec universities, as all other institutions of advanced learning must each year

spend large sums of money in scientific research which is useful on a national basis and serves Canadian commerce and industry.
This, of course, if a very sound observation. But then, the hon. member went on to say that the present federal grants-which I want to underline are unconditional-were "an encroachment on provincial rights in matters of education". And he added:	"As direct
statutory grants to universities, they are not acceptable to Quebec". But he also said "that if federal grants were earmarked solely for research and the construction of laboratories they probably would be acceptable to Quebec on that basis".
This is a most curious and inconsistent position to take. The hon. member says: If federal grants to universities are unconditional, if universities can use that money in any way they like, including research facilities, then they are unconstitutional and unacceptable; but if such grants were conditional, if there were some strings attached or, in other words, if the federal government were restricting the freedom of universities in this respect and allowing them to use the money only for research purposes, then university grants would be acceptable. I admit that I cannot see the logic of that position and I say that this is a dangerous position to take. Perhaps the hon. member is so used to university grants distributed on an arbitrary basis in Quebec by the present provincial government that he would like the federal government to follow the same policy.
As far as I am concerned, I cannot accept that position and I want university grants to remain unconditional. At present Canadian universities are completely free to use that money as they see fit. They may include those grants in their general budget or use them only to finance capital expenditures or research activities. They accept the money this year and refuse it next year. They can also ask for only part of the amounts to which they are entitled each year or which have been accumulated and kept in trust for them by the national conference of Canadian universities. That complete freedom of universities must be preserved at all cost and any scheme involving restricting conditions should be rejected.
We must recognize, however, that the present formula still creates difficulties even if it guarantees the complete freedom of universities. Some people in Quebec are still afraid that it might create in the future an unfair situation for Quebec universities which are in a minority position within the national conference of Canadian universities. Personally, I do not share those fears and I am not alone in showing that confidence and
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optimism. However, in an attempt to overcome those fears and current difficulties, the Minister of Finance should announce his willingness to modify the present formula in one respect.
According to the agreement between the Minister of Finance and the national conference of Canadian universities, the Department of Finance gives each year to the national conference the total amount of the grants, that is $1.50 multiplied by the Canadian population for that year. From then on, the national conference distributes the grants directly to each university according to a simple arithmetical formula specified in the agreement.
My proposal would be to include in the present arrangement a new provision enabling the national conference of Canadian universities, when requested, to transfer the total grant due in a province to a provincial conference of universities which would then assume the responsibility of allocating that grant to each individual university or college on the basis of enrolment. Such a proposal would not materially disrupt the present system of university grants. On the other hand, it would enable universities in a province such as Quebec to form a group of their own and to have thereby an immediate and complete control over the distribution of grants to each university.
I believe that this proposal has some merit and that the minister should declare his willingness to accept it, if universities in any particular province express their preference for that method of distributing the grants. The implementation of that proposal would be very simple indeed because only a slight modification of the existing agreement between the minister and the national conference of Canadian universities would be needed.
I hope that the minister, in his reply, will express his views on that simple proposal which could perhaps solve an important issue. I trust that the minister will accept this proposal in the spirit in which it is offered and that he will feel that it is offered with but one aim in mind, the solution of a problem which is causing, if not injustice, certainly grave difficulties in one of the provinces of confederation. In the light of what I have said I ask the minister to give it his careful consideration.


Douglas Mason Fisher: Mr. Chairman, the issue raised by the hon. member for Laurier is a very important one.


Donald Methuen Fleming: Mr. Chairman, might I ask the hon. member to defer his remarks on this subject to item No. 124
637S

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because there the matter is dealt with specifically. Otherwise we are going to have a discursive debate on this matter. I do not intend to make my remarks on it until we reach that item. I will have something to say on it then. Perhaps my hon. friend would be assisting in making the debate orderly if our remarks on this subject could be reserved until we reach that item.


Douglas Mason Fisher: Mr. Chairman, my remarks will be brief and so the minister need feel no concern about the order or length of the debate. As far as I am concerned, I am eager to leave the chamber as we have been sitting here far too long today.
What was recommended by the hon. member for Laurier was a device to take care of the Quebec situation in this particular matter. I think it is a device worth consideration but I suggest to both the minister and to the hon. member for Laurier that devices of this kind do not represent a solution to the fact that Quebec holds a completely different attitude toward education and the federal role from that held by any other province.
If the minister wants to win a reputation for diplomacy which we thought he was going to establish when he was mooted to be the next secretary of state for external affairs he can do one of two things. He can either make Quebec one out of ten, or on the other hand he could work out some system of federal aid to education that would satisfy the requirements that are now recognized in most provinces in this country and that would win the support of Quebec as well.
The other point I would like to bring up has nothing to do with this. I ask the minister whether he has noticed the recommendation of the committee on mines, forests and waters with regard to forests, and what that committee recommends in so far as a study of forest taxation is concerned, and what role he feels he or his department could adopt for carrying out the study that is recommended by this particular committee. I do not mean just a study that will apply to Ontario and British Columbia but to the industry as a whole, and especially to the pulp and paper industry group as a whole.


John Whitney Pickersgill: Before the minister rises -I am not going to make a speech-I have two questions I want to ask. In the first place, has the minister got the tables for the five provinces on a basis absolutely comparable with the one he tabled the other day in the Newfoundland debate? If so, will he table them and have them put in Hansard so that they are there as available as the other one is?


Donald Methuen Fleming: With pleasure, Mr. Chairman. I will do that right now. I have the tables for all the 10 provinces and the composite table for the aggregate and I have much pleasure in tabling them. If it is the wish of the hon. gentlemen that they be printed in Hansard I am quite in accord with the suggestion.


Some hon. Members:: Agreed.
[Editor's Note: The tables referred to above are as follows:]



STATISTICAL SUMMARY OF FEDERAL CONTRIBUTIONS TO THE PROVINCES FOR THE FISCAL YEARS

[Stage Direction]
1949-50 to 1959-60
Mb. Fleming (Eglinton):
The statistical information for section A, unconditional grants, has been drawn from the public accounts of Canada. The information for section B, conditional grants, has been drawn for the fiscal years 1949-50 to 1952-53 from D.B.S. publication "Financial Statistics of Provincial Governments and from fiscal year 1953-54 to 1957-58 from D.B.S. publication "Financial Statistics of the Government of Canada" which commenced publication ^ for the former fiscal year. There are minor differences between the two publications occasioned by differing year-end adjustments, as the former publica- £-tion is based on the public accounts of the provinces and the latter publication on the public accounts of Canada. The figures for 1958-59 and 1959-60 are from various departmental sources and are preliminary. While the information is generally complete, in some cases no provincial distribution has ^ been available and this has then been made on the basis of previous or anticipated experience.	J°
t-<
The information in Sections C and D is drawn from the public accounts of Canada, departmental and agency sources.	S
With respect to slum clearance (section B), this is the net cost. It does not include advances for purposes of land assembly and low cost housing projects some part of which is recoverable. These advances amount to $18.8 million for 1957, $24.27 million for 1958 and $40 million for 1959. Losses on subsidized rental projects are excluded. These losses amounted to $54,000 in 1957-58.
->4
[Stage Direction]
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1-NEWFOUNDLAND 1949-60
(in thousands of dollars)
A-Unconditional Grants
1.	Statutory Subsidies	
2.	Transitional Grant	
3.	Tax Rental <*	
4.	Equalization	
5.	Stabilization	
0.	50% share of Income Tax on
Power Utilities	
7.	Atlantic Provinces Adjustment
Grant	
8.	Term 29 Award	
Sub-total	
B-Conditional Grants
1.	Agriculture	
2.	Health	
3.	Hospital Insurance	
4.	Welfare	
5.	Vocational Training, etc	
6.	Highways and Transportation...
7.	Resource Development	
8.	Slum Clearance	
9.	Civil Defence	
10.	Other	
Sub-total	
C-Payments for the benefit of provincial institutions	
1.	University Grants	
2.	Grants to Municipalities in lieu of
Taxes on federal property....
Sub-total	
D-Payments to Individuals
1.	Old Age Security	
2.	Family Allowances	
3.	Unemployment Insurance Benefits	
Sub-total	
TOTAL	
									Prelim-	Esti-	
1949-50	1950-51	1951-52	1952-53	1953-54	1954-55	1955-56	1956-57	1957-58	inary 1958-59	mated 1959-60	Total1,925	1,540	1,569	1,569	1,569	1,569	1,509	1,569	1,569	1,569	1,589	17,5866,500	0,500	6,500	5,650	4,800	3,950	3,100	2,250	1,400	1,050	700	42,4004,800	7,220	7,733	12,789	11,825	12,547	12,484	13,805	4,449	4,737	5,402	97,851-	-	-	*	-	-	-	11,579	12,155	13,820	37,554'	'	*	-	-	-	-	-	-	-	--	-	82	98	101	190	208	214	247	286	296	1,702-	-	-	-	-	-	-	-	-	7,500	7,500	15,000-	-	-	-	13,550	7,300	20,85013,285	15,260	15,864	20,106	18,355	18,256	17,361	17,838	19,244	40,847	36,587	233,003-	-	-	-	8	33	81	130	137	162	164	715390	980	729	835	857	824	1,011	1,026	1,095	1,688	2,001	11,436-	-	-	-	-	-	-	-	2,800	4,900	7,7001,468	4,719	3,224	952	1,019	1,020	1,126	3,716	3,456	4,577	4,762	30,039-	47	63	90	84	414	142	406	385	181	345	2,157-	958	999	527	877	2,018	2,240	1,171	861	4,913	3,025	17,589-	-	647	66	56	230	1,660	2,659-	-	-	-	3	21	31	33	14	25	46	173'	-	-	-	-	-	25	-	-	71	96L 858	6,704	5,015	2,404	2,848	4,330	5,278	6,573	6,004	14,576	16,974	72,564-	-	181	187	192	199	206	415	426	657	675	3,138-	-	15	48	17	-	47	-	33	133	n.a.	293-	-	196	235	209	199	253	415	459	790	675	3,431-	-	1,697	6,996	7,243	7,460	7,599	7,738	9,491	11,000	11,160	70,3849,747	10,224	10,614	11,039	11,498	11,968	12,415	12,881	14,131	15,200	15,600	135,3173,291	4,042	2,257	3,553	5,877	7,532	3,261	9,896	15,189	17,871	n.a.	72,76913,038	14,266	14,568	21,588	24,618	26,960	23,275	30,515	38,811	44,071	26,760	278,47028,181	36,230	35,643	44,333	46,030	49,745	46,167	55,341	64,518	100,284	80,996	587,468
(I) The recovery of the overpayment under the 1952 Agreement which amounts to some 1102,315 per annum for fiscal years 1957-58 to 1961-62 has not payments for those above years to which the deduction applies, n.a. = not available.
been deducted from the tax rental 27/5/59
6378	HOUSE OF COMMONS
Supply-Finance
2-PRINCE EDWARD ISLAND 1949-60
(in thousands of dollars)
	1949-50	1950-51	1951-52	1952-53	1953-54	1954-55	1955-56	1956-57	1957-58	Prelim- inary 1958-59	Esti- mated 1959-60	Total
A-Unconditional Grants												
1. Statutory Subsidies	657	657	657	657	657	657	657	657	657	657	657	7,2272. Tax Rental(')	1,746	2,076	2,156	3,951	3,657	3,913	3,681	3,073	769	785	944	26,7513. Equalization	-	-	-	-	-	-	2,955	3,074	3,327	9,3564. Stabilization	-	-	-	-	-	-	-	-	412	418	-	8305. 50% share of Income Tax on Power Utilities	13	19	23	30	43	52	36	52	49	51	3686. Atlantic Provinces Adjustment Grant	-	-	-	-	-	-	-	-	-	2,500	2,500	5,000Sub-total	2,403	2,746	2,832	4,631	4,344	4,613	4,390	3,766	4,845	7,483	7,479	49,532B-Conditional Grants	1. Agriculture	26	24	31	34	35	34	39	38	39	62	63	4252. Health	187	216	237	234	224	276	357	300	335	586	499	3,4513. Hospital Insurance	-	-	-	-	-	-	-	-	-	-	400	4004. Welfare	905	988	791	93	114	128	190	305	366	651	717	5,2485. Vocational Training, etc	36	41	38	30	149	53	51	33	62	75	139	7076. Highways and Transportation...	-	134	400	429	112	23	528	434	1,233	544	525	4,3627. Resource Development	-	-	-	7	10	14	15	15	17	1,240	1,838	3,1568. Slum Clearance	-	-	-	-	-	-	-	-	-	-	-	-9. Civil Defence	-	-	-	-	-	-	-	-	-	1	11	1210. Other	-	-	7	-	-	-	-	-	-	-	-	7Sub-total	1,154	1,403	1,504	827	644	528	1,180	1,125	2,052	3,159	4,192	17,768C-Payments for the benefit of provincial institutions 1. University Grants	49	52	53	53	54	99	99	150	154	7632. Grants to Municipalities in lieu of Taxes on federal government property	-	26	58	76	89	n.a.	249Sub-total	-	-	49	52	53	53	80	157	175	239	154	1,012D-Payments to Individuals	1. Old Age Security	-	-	755	3,156	3,204	3,262	3,314	3,371	4,140	4,800	4,755	30,7572. Family Allowances	2,411	2,467	2,496	2,523	2,558	2,591	2,622	2,641	2,824	3,000	3,050	29,1833. Unemployment Insurance Benefits	505	582	555	755	1,085	1,284	451	1,601	2,505	3,059	n.a.	12,382Sub-total	2,916	3,049	3,806	6,434	6,847	7,137	6,387	7,613	9,469	10,859	7,805	72,322TOTAL	6,473	7,198	8,191	11,944	11,888	12,331	12,037	12,661	16,541	21,740	19,630	140,634
(i) The recovery of the overpayment under the 1952 Agreement which amounts to some $228,221 per annum for fiscal years 1957-58 to 1961-62 has not been deducted from the rental tax payments for those above years to which the deduction applies.
n.a. *= not available.	27/5/59
(-4
[Stage Direction]
r
[Stage Direction]
on
[Stage Direction]
Supply-Finance

3-NOVA SCOTIA 1949-60
(in thousands of dollars)
A-Unconditional Grants
1.	Statutory Subsidies	
2.	Tax Rental	
3.	Equalization	
4.	Stabilization	
5.	50% share of Income Tax on
Power Utilities	
6.	Atlantic Provinces Adjustment
Grant	
Sub-total	
B-Conditional Grants
1.	Agriculture	
2.	Health	
3.	Hospital Insurance	
4.	Welfare	
5.	Vocational Training, etc	
6.	Highways and Transportation...
7.	Resource Development	
8.	Slum Clearance	
9.	Civil Defence	
10.	Other	
Sub-total	
C-Payments for the benefit of provincial institutions
1.	University Grants	
2.	Grants to Municipalities in lieu
of Taxes on federal government property	
Sub-total	
D-Payments to Individuals
1.	Old Age Security	
2.	Family Allowances	
3.	Unemployment Insurance Benefits
Sub-total	
TOTAL	
Prelim-	Esti-	
inary	mated	
1949-50 1950-51 1951-52 1952-53 1953-54 1954-55 1955-56 1956-57 1957-58 1958-59	1959-60	Total2,005	2,005	2,057	2,057	2,057	2,057	2,057	2,057	2,057	2,057	2,057	22,5239,631	11,367	12,541	20,310	19,509	20,475	19,856	22,333	9,032	11,824	11,965	168,843-	-	z	-	-	-	-	-	17,375	15,575	18,704	51,654125	200	138	173	279	300	356	238	401	460	476	3,146-	-	-	-	-	-	-	-	-	7,500	7,500	15,00011,761	13,572	14,736	22,540	21,845	22,832	22,269	24,628	28,865	37,416	40,702	261,1661,370	564	295	73	70	76	72	62	93	103	129	2,907412	715	1,286	1,120	1,530	1,556	1,565	1,719	1,855	2,980	3,103	17,841-	-	-	-	-	-	-	-	-	2,000	8,100	10,1005,814	6,832	5,458	1,147	1,279	1,325	1,560	1,573	2,127	2,829	3,010	32,954200	213	249	273	274	375	399	420	452	510	679	4,04432	-	-	-	-	76	636	951	3,532	2,652	4,657	12,536-	-	-	-	24	88	123	64	51	1,806	1,787	3,943-	-	-	-	-	-	-	-	-	61	390	451-	-	-	-	4	18	31	25	39	49	91	25710	-	7	3	5	5	5	5	5	-	534	5797,838	8,324	7,295	2,616	3,186	3,519	4,391	4,819	8,154	12,990	22,480	85,612-	321	327	332	337	342	695	702	1,065	1,094	5,215-	233	325	384	463	594	1,061	1,194	1,892	1,898	n.a.	8,044-	233	646	711	795	931	1,403	1,889	2,594	2,963	1,094	13,25915,292 5,268	15,660 5,361	4,124 15,950 4,382	17,259 16,297 6,444	17,702 16,716 9,690	18,150 17,148 11,682	18,411 17,597 4,652	18,706 17,973 11,055	23,008 19,400 17,146	26,800 20,600 23,108	27,100 21,000 n.a.	171,260 193,633 98,78820,560	21,021	24,456	40,000	44,108	46,980	40,660	47,734	59,554	70,508	48,100	463,68140,159	43,150	47,133	65,867	69,934	74,262	68,723	79,070	99,167	123,877	112,376	823,718
n.a. = not available.
27/5/59
6380	HOUSE OF COMMONS
Supply-Finance
4-NEW BRUNSWICK
(in thousands of dollars)
	1949-50	1950-51	1951-52
A-Unconditional Grants			
1. Statutory Subsidies	1,632	1,632	1,6792. Tax Rental(')	7,618	10,131	9,4323. Equalization	-	-4. Stabilization	-	-	-5. 50% share of Income Tax on Power Utilities	25	264	1646. Atlantic Provinces Adjustment Grant	-	-	-Sub-total	9,275	12,027	11,275B-Conditional Grants	1. Agriculture	108	76	892. Health	636	565	1,1043. Hospital Insurance	-	-	-4. Welfare	4,873	5,720	4,6745. Vocational Training, etc	550	233	2766. Highways and Transportation...	-	-	1,1107. Resource Development	-	-	-8. Slum Clearance	-	-	-9. Civil Defence	-	-	-10. Other	-	16	27Sub-total	6,167	6,610	7,280
C-Payments for the benefit of provincial institutions
1.	University Grants	
2.	Grants to Municipalities in lieu of Taxes on federal government	258property	-	78	116
Preliminary
1952-53	1953-54	1954-55	1955-56	1956-57	1957-58	1958-591,679 17,516	1,679 16,178	1,679 17,047	1,679 16,630	1,679 17,807	1,679 12,609 8,645	1,679 13,613 8,651187	283	216	208	228	220	202-	-	-	-	-	-	7,50019,382	18,140	18,942	18,517	19,714	23,153	31,64560 1,172	60 1,543	60 1,472	51 1,296	53 1,926	51 1,813	99 2,1031,388 218 649 305	1,512 228 284 1,012	1,556 253 511 333	1,784 234 1,286 333	1,848 248 3,982 664	2,332 278 3,977 1,074	3,006 343 12,002 9721	-	13	13	21	34	38 613,793	4,639	4,198	4,997	8,742	9,559	18,624263	268	274	279	555	565	866175	213	219	1,363	1,419	1,131	1,495
Estimated
1,679
8,533
16,622
7,500
34,543
2,682
4,200
3,212
9,550
2,962
69
23,966
n.a.
Total
18,375
147,114
33,918
2,206
15,000
216,613
16,312
4,200
31,905
3,569
33,351
7,655
188
98,575
4,217
6,209
Sub-total	-	78	374	438	481	493	1,642	1,974	1,696	2,361	889	10,426D-Payments to Individuals 1.	Old Age Security	
2.	Family Allowances	
3.	Unemployment Insurance Benefits	13,375 4,389	13,708 4,327	2,935 13,893 3,374	12,255 14,288 6,667	12,607 14,701 9,110	12,946 15,073 11,145	13,246 15,452 4,553	43,528 15,779 12,680	16,748 17,075 19,891	19,600 18,200 22,287	19,850 19,000 n.a.	123,715 170,544 98,423Sub-total	17,764	18,035	20,202	33,210	36,418	39,164	33,251	41,987	53,714	60,087	38,850	392,682TOTAL	33,206	36,750	39,131	56,823	59,678	62,797	58,407	72,417	88,122	112,717	98,248	718i,296
(') The recovery of the overpayment under the 1952 Agreement which amounts to some $182,201 per annum for fiscal years 1957-53 to 1961-62 has not been deducted from the tar rental payments for those above years to which the deduction applies.
n.a. = not available.	27/5/59

r*
«i
[Stage Direction]
Cn
co
Supply-Finance
Fleming (Eglinton).]
5-QUEBEC
(in thousands of dollars)
A-Unconditional Grants
1.	Statutory Subsidies	
2.	Tax Rental	
3.	Equalization	
4.	Stabilization	
5.	50% Share of Income Tax on
Power Utilities	
Sub-total	
B-Conditional Grants
1.	Agriculture	
2.	Health	
3.	Hospital Insurance	
4.	Welfare	
5.	Vocational Training, etc....
6.	Highways and Transportation...
7.	Resource Development	
8.	Slum Clearance	
9.	Civil Defence	
10.	Other	
Sub-total	
C-Payments for the benefit of provincial institutions
1.	University Grants	
2.	Grants to Municipalities in lieu
of Taxes on federal property-
Sub-total	
D-Payments to Individuals
1.	Old Age Security	
2.	Family Allowances.	....
3.	Unemployment Insurance Benefits
Sub-total	
TOTAL	
1949-50	1950-51	1951-52	1952-53	1953-54	1954-55	1955-56	1956-57	1957-58	Prelim- inary 1958-59	Esti- mated 1959-60	Total ^2,867	2,867 1,247	3,301 559	3,301 910	3,301 2,120	3,301 1,661	3,301 1,009	3,301 1,186	3,301 43,060 1,675	3,301 55,004 2,281	3,301 61,581 2,364	35,443 | - ^ 159,645 §' - a 3 15,012 <32,867	4,114	3,860	4,211	5,421	4,962	4,310	4,487	48,036	60,586	67,246	210,100616	632	638	529	639	424	305	350	278	843	704	5,9582,434	6,047	7,261	7,496	9,635	9,653	10,137	10,291	8,332	12,461	17,285	101,03223,643	25,909	21,107	8,024	8,245	8,422	10,955	11,746	16,069	20,821	22,778	177,719943	1,147	1,062	987	923	649	648	648	5	-	-	7,012123	32	128	17	-	445	99	3,388	5,729	9,9619	21	-	64	16	122	128	360-	-	-	-	2,144	100	2,244-	-	-	2	6	683	691-	1,219	-	-	-	-	-	-	-	-	1,998	3,21727,636	34,954	30,191	17,068	19,579	19,186	22,045	23,544	24,801	39,785	49,405	308,194-	-	2,028	-	-	-	-	4,628	4,758	7,326	7,527	26,267-	53	15	40	139	310	886	1,170	2,424	2,709	n.a.	7,746-	53	2,043	40	139	310	886	5,798	7,182	10,035	7,527	34,01395,902 29,771	99,558 32,494	16,580 102,884 29,531	69,570 107,084 47,042	72,033 111,441 66,005	74,725 116,057 83,564	77,111 120,390 32,534	79,651 124,368 78,240	99,490 136,081 121,861	117,100 146,300 157,925	121,200 151,000 n.a.	727,460 1,311,065 678,967125,673	132,052	148,995	223,696	249,479	274,346	230,035	282,259	357,432	421,325	272,200	2,717,492156,176	171,173	185,089	245,015	274,618	298,804	257,276	316,088	437,451	631,731	396,378	3,269,799
n.a. = not available.
27/5/59
6382	HOUSE OF COMMONS
Supply-Finance
06968-9-404
6-ONTARIO
(in thousands of dollars)
A-Unconditional Grants
1.	Statutory Subsidies	
2.	Tax Rental	
3.	Equalization	
4.	Stabilization	
5.	50% Share of Income Tax on
Power Utilities	
Sub-total	
B-Conditional Grants
1.	Agriculture	
2.	Health	
3.	Hospital Insurance	
4.	Welfare	
5.	Vocational Training, etc	
6.	Highways and Transportation...
7.	Resource Development	
8.	Slum Clearance	
9.	Civil Defence	
10.	Other	
Sub-total	
C-Payments for the benefit of provincial institutions
1.	University Grants	
2.	Grants to Municipalities in lieu
of Taxes on federal property
[Stage Direction]
Sub-total	
D-Payments to Individuals
1.	Old Age Security	
2.	Family Allowances	
3.	Unemployment Insurance Benefits
Sub-total	
TOTAL	
1949-50	1950-51	1951-52	1952-53	1953-54	1954-553,155	3,155	3,641	3,641	3,641	3,6411 1	1 1	1 1	123,327	134,448	142,747-	815	630	474	1,097	1,3423,155	3,970	4,271	127,442	139,186	147,730131	86	69	62	63	444,332	4,569	6,883	8,857	7,492	8,30028,643	30,895	24,753	5,219	5,328	5,8561,415	1,146	1,325	2,017	1,494	1,367-	2,790	5,068	4,104	2,692	6,583-	'	431	544	502311	-	372	525-	-	-	27	8524	3	415	14	-	35734,545	39,489	38,824	20,704	18,102	23,619-	-	2,299	2,383	2,449	2,523450	782	1,406	1,639	2,236	2,016450	782	3,705	4,022	4,685	4,53984,941 22,330	89,035 21,671	28,195 93,207 26,612	120,083 98,304 37,854	125,775 104,410 51,763	130,296 110,492 87,685107,271	110,706	148,014	256,241	281,948	328,473145,421	154,947	194,814	408,409	443,831	504,3611955-56	1956-57	1957-58	Prelim- inary 1958-59	Esti- mated 1959-60	Total3,641 138,345	3,641 160,558	3,641 74,379	3,641 93,322	3,641 105,617	39,079 972,7431,574	1,428	1,333	1,590	1,648	11,931143,560	165,627	79,553	98,553	110,906	1,023,75352 9,278 7,243 1,342 3,366 944 191 461	63 10,606 7,134 1,234 5,184 850 142 348 27	91 9,955 11,173 703 12,927 1,237 1,000 451 27	113 12,693 15,600 20,615 4,052 21,226 3,539 449	126 20,357 77,200 21,037 3,850 21,700 5,559 2,653 799 3,680	900 103,322 92,800 167,896 19,945 85,640 13,606 5,003 2,350 5,00822,877	25,588	37,564	78,287	156,961	496,4702,592	5,405	5,622	8,705	8,943	40,921!4,224	5,009	8,413	10,038	n.a.	36,2136,816	10,414	14,035	18,743	8,943	77,134134,644 116,604 27,877	138,793 122,539 66,014	172,804 136,706 120,719	203,700 150,200 149,266	208,050 158,000 n.a.	1,262,340 1,264,438 611,791279,125	327,346	430,229	503,166	366,050	3,138,569452,378	528,975	561,181	698,749	642,860	4,735,926
n.a. = not available.
27/5/59
[Stage Direction]
r
[Stage Direction]


cn
[Stage Direction]
Supply-Finance

7-MANITOBA 1949-60
(in thousands of dollars)
A-Unconditional Grants
1.	Statutory Subsidies	
2.	Tax Rental(')	
3.	Equalization	
4.	Stabilization	
5.	50% Share of Income Tax on
Power Utilities	
Sub-total	
B-Conditional Grants
1.	Agriculture	
2.	Health	
3.	Hospital Insurance	
4.	Welfare	
5.	Vocational Training, etc	
6.	Highways and Transportation...
7.	Resource Development	
8.	Slum Clearance	
9.	Civil Defence	
10. Other	
Sub-total	
C-Payments for the benefit of provincial institutions
1.	University Grants	
2.	Grants to Municipalities in lieu
of Taxes on federal property....
Sub-total	
D-Payments to Individuals
1.	Old Age Security	
2.	Family Allowances...
3.	Unemployment Insurance Benefits
Sub-total	
TOTAL	
1949-50	1950-51	1951-52	1952-531,767 10,743	1,750 13,981	1,755 14,568	1,755 26,036225	225	331	38312,735	15,956	16,654	28,174821	4 1,052	2 1,084	7 1,3615,764 332 279	6,189 281 340	4,896 273 772	1,190 246 1,060 1147	12,500	43	167,203	20,366	7,070	3,994-	-	388	399-	21	17	64-	21	405	46315,669 4,221	16,236 5,217	4,457 16,703 4,831	19,020 17,284 6,26319,890	21,453	25,991	42,56739,828	57,796	50,120	75,1981953-54	1954-55	1955-56	1956-571,755 25,039	1,852 26,201	1,820 25,656	2,032 27,889569	28	114	5127,363	28,081	27,590	29,97279 1,737	36 2,052	22 2,199	108 2,6761,260 257 1,530 138	1,275 196 2,097 126	1,437 366 1,382 196	2,213 262 3,124 7825	26	37	32 185,026	5,808	5,639	8,511405	414	425	85039	14	63	788444	428	488	1,63820,053 17,980 8,226	21,051 18,705 11,200	21,953 19,419 3,961	22,842 19,889 10,57146,259	50,956	45,333	53,30279,092	85,273	79,050	93,4231957-58	Prelim- inary 1958-59	Esti- mated 1959-60	Total2,032 18,418 13,932	2,032 20,688 12,889	2,052 22,610 14,978	20,602 231,829 41,79961	46	49	2,08234,443	35,655	39,689	296,312156 2,241 2,523 362 2,747 316	30 2,720 7,300 3,916 362 1,970 2,104	35 3,155 11,800 4,085 557 2,600 1,869	479 21,098 19,100 34,748 3,494 17,901 4,94133	61 51	130 624	360 13,2438,378	18,514	24,855	115,364860	1,305	1,341	6,3871,040	1,544	n.a.	3,5901,900	2,849	1,341	9,97728,562 21,521 15,040	34.100 23.100 17,604	35,300 24,000 n.a.	207,338 210,506 87,13465,123	74,804	59,300	504,978109,844	131,822	125,185	926,631
(') The recovery of the overpayment under the 1952 Agreement which amounts to some $209,938 per annum for fiscal years 1957-58 to 1961-62 has not been deducted from the tax rental payments for those above years to which the deduction applies.
n.a. = not available.
27/5/59
6384	HOUSE OF COMMONS
Supply-Finance
8-SASKATCHEWAN
(in thousands of dollars)
										Prelim-	Esti-	
										inary	mated	
	1949-50	1950-51	1951-52	1952-53	1953-54	1954-55	1955-56	1956-57	1957-58	1958-59	1959-60	Total
A-Unconditional Grants												
1. Statutory Subsidies	2,072	2,062	2,041	2,041	2,041	2,088	2,072	2,080	2,080	2,080	2,089	22,7462. Tax Rental^)	12,605	15,416	16,513	26,121	25,254	26,647	25,986	27,432	13,874	14,399	17,064	221,3113. Equalization	-	-	-	-	-	-	-	-	19,197	19,862	21,250	60,3094. Stabilization	-	-	-	-	-	-	-	-	-	-	-	-5. 50% Share of Income Tax on	Power Utilities	25	43	33	31	43	44	47	50	66	96	100	578Sub-total	14,702	17,521	18,587	28,193	27,338	28,779	28,105	29,562	35,217	36,437	40,503	304,944B-Conditional Grants	1. Agriculture	29	32	33	37	30	33	47	30	55	54	64	4442. Health	1,430	1,470	1,628	1,728	1,951	2,588	2,845	2,095	2,275	3,298	3,651	24,959-	-	-	-	-	-	-	-	-	8,500	13,600	22,1004. Welfare	5,518	5,970	4,812	1,116	1,156	1,239	1,463	2,199	2,577	3,892	3,980	33,9225. Vocational Training, etc	535	405	414	341	243	327	310	340	419	425	758	4,5176. Highways and Transportation...	-	341	1,021	1,704	2,058	1,997	2,001	2,919	3,351	1,273	860	17,5257. Resource Development	-	-	-	75	86	96	89	49	216	1,364	2,812	4,7878. Slum Clearance	-	-	-	-	-	-	-	-	-	-	-	-9. Civil Defence	-	-	-	29	34	43	39	49	43	51	97	38510. Other	9	130	138	-	-	4	10	42	10	34	464	841Sub-total	7,521	8,348	8,046	5,030	5,558	6,327	6,804	7,723	8,946	18,891	26,286	109,480C-Payments for the benefit of provin-	cial institutions	1. University Grants	-	-	416	422	431	439	445	881	879	1,332	1,368	6,6132. Grants to Municipalities in lieu	of Taxes on federal property	-	34	16	12	7	19	50	284	625	726	n.a.	1,773!Sub-total	-	34	432	434	438	458	495	1,165	1,504	2,058	1,368	8,386'D-Payments to Individuals	1. Old Age Security	-	-	4,399	19,037	20,111	21,203	22,331	23,335	29,420	35,100	36,215	211,1512. Familv Allowances... 	18,954	19,237	19,425	19,723	20,245	20,895	21,401	21,645	23,242	24,800	25,500	235,0673. Unemployment Insurance Benefits	2,552	2,957	2,466	2,937	4,008	6,629	2,608	7,431	10,381	12,430	n.a.	543,990Sub-total	21,506	22,194	26,290	41,697	44,364	48,727	46,340	52,411	63,043	72,330	61,715	500,617TOTAL	43,729	48,097	53,355	75,354	77,698	84,291	81,744	90,861	108,710	129,716	129,872	923,427
<1
a
[Stage Direction]
*<
(*) The recovery of the overpayment under the 1952 Agreement which amounts to some $304,180 per annum for fiscal years 1957-58 to 1961-62 has not been deducted from the tax rental payments for those above years to which the deduction applies.
n.a. *=not available	27/5/59
Supply-Finance

9-ALBERTA 1949-60
(in thousands of dollars)
A-Unconditional Grants
1.	Statutory Subsidies	
2.	Tax Rental	
3.	Equalization	
4.	Stabilization	
5.	50% Share of Income Tax on
Power Utilities	
Sub-total	
B-Conditional Grants
1.	Agriculture	
2.	Health	
3.	Hospital Insurance	
4.	Welfare	
5.	Vocational Training, etc	
6.	Highways and Transportation...
7.	Resource Development	
8.	Slum Clearance	
9.	Civil Defence	
10. Other	
Sub-total	
C-Payments for the benefit of provincial institutions
1.	University Grants	
2.	Grants to Municipalities in lieu
of Taxes on federal property....
Sub-total	
D-Payments to Individuals
1.	Old Age Security	
2.	Family Allowances	
3.	Unemployment Insurance Benefits
Sub-total	
TOTAL	
1949-50	1950-51	1951-52	1952-532,086 11,889	2,063 14,765	2,127 14,799	2,127 32,322425	767	793	99114,400	17,595	17,719	35,440218 1,274	241 1,600	121 1,737	99 2,4114,904 261	5,924 321 15	6,241 311 814	1,211 483 1,270 16662	11	-	126,719	8,112	9.224	5,652-	470	485-	94	2	65-	94	472	55019,822 3,158	20,762 4,128	4,333 21,573 3,628	18,745 22,576 4,92922,980	24,890	29,534	46,25044,099	50,691	56,949	87,8921953-54	1954-55	1955-56	1956-572,127	2,228	2,195	2,27429,803	31,816	31,593	37,3111,396	1,658	1,958	1,76733,326	35,702	35,746	41,35246	65	60	661,841	2,313	2,562	2,5891,243	1,310	1,685	1,648459	470	495	5282,748	1,806	1,627	2,01982	55	29	2185	119	172	11910	10	10	106,514	6,148	6,640	7,000501	520	533	1,12393	76	252	330594	596	785	1,45320,138 23,958 8,200	21,418 25,391 11,956	22,682 26,753 4,533	23,942 27,953 10,17452,296	58,765	53,968	62,06992,730	101,211	97,139	111,8741957-58	Prelim- inary 1958-59	Esti- mated 1959-60	Total2,274 28,892 14,744	2,274 38,350 7,991	2,353 39,555 13,488	24,128 311,095 36,2231,980	2,216	2,298	16,24947,890	50,831	57,694	387,69567 2,888 2,148 1,380 5,398 184	70 3,520 9,300 4,382 1,658 2,825 1,538	70 4,203 15,800 4,493 871 1,600 2,357	1,123 26,938 25,100 35,189 7,237 20,122 4,432142 20	126	146 1,603	909 1,74812,227	23,419	31,143	122,7981,160	1,802	1,851	8,4451,045	1,676	n.a.	3,6332,205	3,478	1,851	12,07830,443 31,030 17,410	36,600 34,100 20,846	38,400 36,000 n.a.	216,701 289,918 88,96278,883	91,546	74,400	595,581141,205	169,274	165,088	1,118,152
n.a. = not available.
27/5/59
6386	HOUSE OF COMMONS
Supply-Finance
10-BRITISH COLUMBIA
(in thousands of dollars)
A-Unconditional Grants
1.	Statutory Subsidies	
2.	Tax Rental	
3.	Equalization	
4.	Stabilization	
5.	50% Share of Income Tax on
Power Utilities	
Sub-total	
B-Conditional Grants
1.	Agriculture	
2.	Health	
3.	Hospital Insurance	
4.	Welfare	
5.	Vocational Training, etc	
6.	Highways and Transportation...
7.	Resource Development	
8.	Slum Clearance	
9.	Civil Defence	
10. Other	
Sub-total	
C-Payments for the benefit of provincial institutions
1.	University Grants.

	
2.	Grants to Municipalities in lieu
of Taxes on federal property-
Sub-total	
D-Payments to Individuals
1.	Old Age Security	
2.	Family Allowances	
3.	Unemployment Insurance Benefits
Sub-total	
TOTAL	
1949-50	1950-51	1951-521,003 17,789	1,003 19,166	1,281 19,127550	991	1,00519,342	21,160	21,41345 1,178	58 1,756	58 2,7599,276 383 4,024	10,477 254 2,538	8,566 233 3,695201	152	20315,107	15,235	15,514-	-	583-	78	105-	78	68820,814 13,823	21,953 12,547	8,543 23,064 13,21534,637	34,500	44,82269,086	70,973	82,4371952-53	1953-54	1954-551,281 46,199	1,281 43,516	1,281 46,0521,099	853	1,81248,579	45,650	49,14576 2,045	51 2,667	48 2,9831,865 243 3,598 885	2,038 290 3,377 931	2,046 276 3,379 1,002115 25	108 10	187 108,852	9,472	9,931599	615	63389	148	123688	763	75636,803 24,400 18,970	39,880 25,904 23,000	42,450 27,406 25,12180,173	88,784	94,977138,292	144,669	154,8091955-56	1956-57	1957-581,281 45,393	1,281 55,730	1,281 51,446 4,491 3,0462,422	1,415	1,32549,096	58,426	61,58944 2,450	38 3,210	70 3,8072,074 328 3,437 721	5,971 549 6,680 846	5,378 719 16,818 1,147214 10	187 10	212 109,278	17,491	28,161653	1,398	1,487273	596	1,453926	1,994	2,94044,657 29,097 7,847	46,924 31,029 23,847	59,408 34,969 44,93681,601	101,800	139,313140,901	179,711	232,003Prelim- inary 1958-59	Esti- mated 1959-60	Total1,281 51,321 8,237 5,258	1,281 61,062 7,317	13,535 456,801 20,045 8,3041,456	1,509	14,43767,553	71,169	513,12276 4,469 12,300 8,088 919 14,528 3,839 225 104	105 6,100 20,400 8,115 2,118 20,008 2,862 600 225 1,125	669 33,424 32,700 63,894 6,312 76,058 16,257 600 1,473 1,86044,548	61,658	235,2472,316	2,379	10,6632,245	n.a.	5,1104,561	2,379	15,77370,800 38,400 54,652	73,600 40,200 n.a.	423,065 317,236 237,958163,852	113,800	978,259280,514	249,006	1,742,401
a
r
[Stage Direction]


tn
[Stage Direction]
n.a. = not available.
27/5/59
Supply-Finance

[Stage Direction]
(in thousands of dollars)
Prelim-
1949-50	1950-51	1951-52	1952-53	1953-54	1954-55	1955-56	1956-57	1957-58	inary 1958-59	Estimated 1959-60	Total1. Newfoundland (а)	Unconditional grants(>)	
(б)	Conditional grants	
(c)	Payments for the benefit institutions	
(d)	Payments to Individuals-	of provincial	13,285 1,858 13,038	15,260 6,704 14,266	15,864 5,015 196 14,568	20,106 2,404 235 21,588	18,355 2,848 209 24,618	18,256 4,330 199 26,960	17,361 5,278 253 23,275	17,838 6,573 415 30,515	19,244 6,004 459 38,811	40,847 14,576 790 44,071	36,587 16,974 675 26,760	i i 233,003, 72,564 3,431 278,470TOTAL	28,181	36,230	35,643	44,333	46,030	49,745	46,167	55,341	64,518	100,284	80,996	587,4682. Prince Edward Island	2,403	2,746	2,832	4,631	4,344	4,613	4,390	3,766	4,845	7,483	7,479	49,532(b)	Conditional grants	
(c)	Payments for the benefit	of provincial	1,154	1,403	1,504	827	644	528	1,180	1,125	2,052	3,159	4,192	17,768-	-	49	52	53	53	80	157	175	239	154	1,012(d) Payments to Individuals-	2,916	3,049	3,806	6,434	6,847	7,137	6,387	7,613	9,469	10,859	7,805	72,322TOTAL	6,473	7,198	8,191	11,944	11,888	12,331	12,037	12,661	16,541	21,740	19,630	140,6343. Nova Scotia	11,761	13,572	14,736	22,540	21,845	22,832	22,269	24,628	28,865	37,416	40,702	261,166(6) Conditional grants 	
(e) Payments for the benefit	of provincial	7,838	8,324	7,295	2,616	3,186	3,519	4,391	4,819	8,154	12,990	22,480	85,612-	233	646	711	795	931	1,403	1,889	2,594	2,963	1,094	13,259(d) Payments to Individuals-	20,560	21,021	24,456	40,000	44,108	46,980	40,660	47,734	59,554	70,508	48,100	463,681TOTAL	40,159	43,150	47,133	65,867	69,934	74,262	68,723	79,070	99,167	123,877	112,376	823,7184. New Brunswick	9,275	12,027	11,275	19,382	18,140	18,942	18,517	19,714	23,153	31,645	34,543	216,613(6) Conditional grants	
(c) Payments for the benefit	of provincial	6,167	6,610	7,280	3,793	4,639	4,198	4,997	8,742	9,559	18,624	23,966	98,575-	78	374	438	481	493	1,642	1,974	1,696	2,361	889	10,426(d) Payments to Individuals -	17,764	18,035	20,202	33,210	36,418	39,164	33,251	41,987	53,714	60,087	38,850	392,682TOTAL	33,206	36,750	39,131	56,823	59,678	62,797	58,407	72,417	88,122	112,717	98,248	718,2965. Quebec	2,867	4,114	3,860	4,21i	5,421	4,962	4,310	4,487	48,036	60,586	67,246	210,100(6) Conditional grants	
(c) Payments for the benefit	of provincial	27,636	34,954	30,191	17,068	19,579	19,186	22,045	23,544	24,801	39,785	49,405	308,194-	53	2,043	40	139	310	886	5,798	7,182	10,035	7,527	34,013(d) Payments to Individuals-	125,673	132,052	148,995	223,696	249,479	274,346	230,035	282,259	357,432	421,325	272,200	2,717,492TOTAL	156,176	171,173	185,089	245,015	274,618	298,804	257,276	316,088	437,451	531,731	396,378	3,269,7996388	HOUSE OF COMMONS
Supply-Finance
6. Ontario
(a)	Unconditional grants	
(b)	Conditional grants	
(c)	Payments for the benefit institutions 	
Cd) Payments to Individuals	of	provincial	3,155 34,545 450 107,271	3,970 39,489 782 110,706	4,271 38,824 3,705 145,014	127,442 20,704 4,022 256,241	139,186 18,012 4,685 281,948	147,730 23,619 4,539 328,473	143,560 22,877 6,816 279,125	165,627 25,588 10,414 327,346	79,353 37,564 14,035 430,229	98,553 78,287 18,743 503,166	110,906 156,961 8,943 366,050	1,023,753 496,470 77,134 3,138,569TOTAL	145,421	i54,947	194,814	408.409	443,831	504,361	452,378	528,975	561,181	698,749	642,860	4,735,9267. Manitoba	(a) Unconditional grants0)	12,735	15,956	16,654	28,174	27,363	28,081	27,590	29,972	34,443	35,655	39,689	296,312(6) Conditional grants	
(c) Payments for the benefit	of	provincial	7,203	20,366	7,070	3,994	5,026	5,808	5,639	8,511	S,378	i8,514	24,855	115,364institutions 	-	21	405	463	444	428	488	1,638	1,900	2,849	1,341	9,977(d) Payments to Individuals....	19,890	21,453	25,991	42,567	46,259	50,956	45,333	53,302	65,123	74,804	59,300	504,978TOTAL	39,828	57,796	50,120	75,198	79,092	85,273	79,050	93,423	109,844	131,822	125,185	926,6318. Saskatchewan	(a) Unconditional grantsO)	14,702	17,521	18,587	28,193	27,338	28,779	28,105	29,562	35,217	36,437	40,503	304,944(b)	Conditional grants	
(c)	Payments for the benefit	of	provincial	7,521	8,348	8,046	5,030	5,558	6,327	6,804	7,723	8,946	18,891	26,286	109,480institutions 	* -	34	432	434	438	458	495	1,165	1,504	2,058	1,368	8,386(d) Payments to Individuals	21,506	22,194	26,290	41,697	44,364	48,727	46,340	52,4il	63,043	72,330	61,715	500,617TOTAL	43,729	48,097	53,355	75,354	77,698	84,291	81,744	90,861	108,710	129,716	129,872	923,4279.7 Alberta	(a) Unconditional grants	14,400	17,595	17,719	35,440	33,326	35,702	35,746	41,352	47,890	50,831	57,694	387,695(b)	Conditional grants	
(c)	Payments for the benefit	of	provincial	6,719	8,112	9,224	5,652	6,514	6,148	6,640	7,000	12,227	23,419	31,143	122,798institutions 	-	94	472	550	594	596	785	1,453	2,205	3,478	1,851	12,078(<f) Payments to Individuals	22,980	24,890	29,534	46,250	52,296	58,765	53,968	62,069	78,883	91,546	74,400	595,581TOTAL	44,099	50,691	56,949	87,892	92,730	101,211	97,139	111,874	141,205	169,274	165,088	1,118,15210. British Columbia	(a) Unconditional grants	19,342	21,160	21,413	48,579	45,650	49,145	49,096	58,426	61,589	67,553	71,169	5.3,122'(b)	Conditional grants	
(c)	Payments for the benefit	of	provincial	15,107	15,235	15,514	8,852	9,472	9,931	9,278	17,491	28,161	44,548	61,658	235,247,institutions	-	78	688	688	763	756	926	1,994	2,940	4,561	2,379	15,773(d) Payments to Individuals	34,637	34,500	44,822	80,173	88,784	94,977	81,601	101,800	139,313	163,852	113,800	978,259TOTAL	69,086	70,973	82,437	138,292	144,669	154,809	140,901	179,711	232,003	280,514	249,006	1,742,401GRAND TOTAL.	606,358	677,005	752,862	1,209,127	1,300,168	1,427,884	1,293,822	1,540,421	1,858,742	2,300,424	2,019,639	14,986.452
<-*
[Stage Direction]
r
h;
(') The recovery of the overpayments under the 1952 Tax Agreements which recovery is deductible in equal instalments over the five years of the current Tax Agreement has not been deducted from the tax rental payment shown above for the fiscal years 1957-8, 1958-9 and 1959-60. The annual recovery (in thousands of dollars) amounts to $102 for Newfoundland, $228 for Prince Edward Island, $182 for New Brunswick, $210 for Manitoba and $304 for Saskatchewan.
Source: Statistical Summary of Federal Contributions to the Provinces for the fiscal years 1949-50 to 1959-60
d. 27/5/59
Supply-Finance
[Stage Direction]
Supply-Finance
John Whitney Pickersgill: I have another question which is precisely the same question I asked the minister in the dying days of the session last year and it is: Is there going to be a federal-provincial conference before the next session of parliament, and is it the intention of the government to make some modifications in the existing tax-sharing arrangements? He knows the act expires on March 31, so far as the 3 per cent is concerned. If not, is he going to continue that 3 per cent for the rest of the currency of the taxsharing arrangements, instead of making us go through this annual agony, which took about a quarter of the session, to put this statute through. In order to save the minister's time in answering the question I will give him the answer he gave last year. I am sure it will be the same answer. The minister said, as reported at page 4711 of Hansard of September 6, 1958:
I have dealt with that question. I said that when it is appropriate for the announcement to be made it will be made.


Donald Methuen Fleming: Mr. Chairman, may I deal with the last subject first. I thank the hon. member for Bonavista-Twillingate for supplying a very appropriate answer to his own question. At this stage I do not think I can usefully add anything to what I said on this subject in reply to a number of questions on the same point in this house within the past fortnight.
Then, as to the question by the hon. member for Port Arthur in regard to the study that he invites me to make of the report of the committee on mines, forests and waters, of course I shall be examining the recommendations of that committee.
Mr. Chairman, I have already indicated in comment on the subject introduced by the hon. member for Laurier, namely the federal grants to the universities, that I thought the proper place for discussion of that matter was under item 124 when we reach it, and I shall have something to say on that subject when we reach that item.
The other matters were subjects introduced by the Leader of the Opposition and here I think I can be quite brief. The Leader of the Opposition raised questions concerning money supply. Mr. Chairman, he is aware that money supply varies from month to month or week to week. There is no fixed amount. There are bound to be variations at any time and there are, of course, seasonal variations. He seemed to be viewing with some alarm the recent increases in money supply. It has been made quite clear that so far as the Bank of Canada has control over money supply there is no thought of embarking on a policy of increasing money supply. I do think that the Leader

of the Opposition was expressing some unfounded apprehensions in this respect.
The high point of money supply in 1958 was reached on October 1. The money supply at that time was $13,213 million. At the latest date for which figures have been issued, namely July 8 during the last week, the figure was $13,350 million. Thus it will be seen that there has been no significant increase in money supply and it has been made quite clear by the Bank of Canada that it has no thought of embarking upon an increase of money supply under existing circumstances.
The next subject introduced by the Leader of the Opposition concerned high interest rates. I think there is nothing new introduced in this respect. I do not intend to repeat things that have been said earlier at this present session. I think hon. members will agree that at any rate I dealt with this subject at some length on previous occasions, and I will content myself by referring to my effort to treat that subject on an earlier occasion. But it is, I think, in the minds of hon. members who have been following what has been happening in the United States of late that the figures at which the United States treasury is borrowing money today have set an alltime record high interest rate for borrowing in the United States. That is a factor that all would do well to bear in mind who are measuring trends in this country.
Finally, the Leader of the Opposition made some reference to debt maturity, particularly debt in the category of two years and under. Mr. Chairman, I have the figures before me in this respect. At June 30, a year ago, the debt, measured in terms of treasury bills and bonds in that category, totalled $4,798 million. At May 31, 1959 the aggregate in the same categories was $4,374 million. Between June 15-


Mr. Benidickson:: Are you including Canada savings bonds?


Donald Methuen Fleming: No. Between June 1 and July 15 there has been an increase of $100 million in treasury bills, bringing the figure that I gave to a figure of $4,474 million on July 15. Accordingly, there has been in the past 12J months a decrease of maturities in this category of some $324 million.
It is worthy of note also that if one measures maturities in terms of average term, we have the same interesting comparison. The nearest date to the one on which we came into office was June 30, 1957, and the average term to maturity of federal debt at that time was six years and two months. Today, thanks to the conversion loan which was derided by the hon. member for Welland, the average term of federal debt is nine years and nine months.


George James McIlraith: I have one question I would like to ask the Minister of Finance. It is most appropriate to be asked here. It arises out of a sentence in the throne speech and I will read the sentence. The part I want to quote is this:
My government will request your approval of its participation in a contributory plan to provide medical benefits for civil servants pursuant to recommendations of the national joint council of the public service.
Will the minister explain what, if anything, has transpired on that subject and what the position is at the moment?


Donald Methuen Fleming: Mr. Chairman, that relates to an item in the supplementary estimates, No. 513. There is an item there of $3,500,000 for the purpose. Perhaps the hon. gentleman would prefer to wait and deal with it when we reach that item.


George James McIlraith: I do not want to elaborate on it. Is item 513 the answer to what was intended by that paragraph in the throne speech? That is really my question.


Donald Methuen Fleming: Yes, Mr. Chairman.


William Moore Benidickson: The minister will note that he has an item there for interest on the public debt. We all know that that would be an estimate made last November or December. We also know that since then the cost of borrowing money has increased very substantially. Does the minister anticipate he will require a supplementary estimate in connection with this matter?


Donald Methuen Fleming: The hon. member has inquired about a statutory item at the bottom of page 22 of the book of estimates. There is really nothing I can usefully say to him on this subject. This is the best estimate and no one can predict precisely what will be the course of interest rates at any measurable projection into the future.


[Stage Direction]
Item agreed to.
University grants-
124. Payments to the national conference of Canadian universities (hereinafter called the "conference"), in accordance with the agreement entered into between the conference and the Minister of Finance on the 19th day of November, 1958, (hereinafter called the "original agreement") pursuant to vote 541 of the Appropriation Act No. 1, 1957, and vote 669 of the Appropriation Act No. 5, 1958; and when a new corporation comes into existence (incorporated for the purpose of receiving and disbursing such payments to institutions of higher learning) to authorize the payments to be made thereto, in lieu of to the conference, in accordance with an agreement to be entered into, with the approval of the governor in council, by the Minister of Finance with the conference and the new corporation. such agreement to provide, in addition to 66968-9-405
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terms and conditions similar to the terms and conditions in the original agreement, including a provision that any amount payable to an institution of higher learning and not paid by the corporation in the relevant fiscal year may be retained by the corporation until such time as the institution to which the money is payable claims the payment from the corporation or parliament provides otherwise for the disposal thereof, for the transfer of amounts in the possession of the conference to the new corporation and for termination of the original agreement, $26,221,500.
Donald Methuen Fleming: On item 124 I should like to say something in reply to the observations on this point offered to the committee a few moments ago by the hon. member for Laurier. No one will question that this is an important matter and that it does present some problems. I propose to say something very frankly in regard to them.
First let me say, Mr. Chairman, that I think the hon. member for Laurier was drawing a long bow when he tried to make an argument out of a reference to an expression used in a table in the budget speech. If he will look at page 2410 of the budget speech, and this is the subject of his earlier reference, he will see that the matter of university grants was one of two subjects listed under the heading, "Payments for the Benefit of Provincial Institutions". Under that heading there are payments of two natures referred to; first, university grants, and, second, grants to municipalities in lieu of taxes on federal government property.
I do not think it is going to be argued seriously by any member of the house that universities and municipalities are not in this sense provincial institutions-


John Whitney Pickersgill: They are nothing of the kind.


Donald Methuen Fleming: -because they are created under provincial legislation. Every university that I know of in Canada is subject to provincial jurisdiction. There is no such thing as a university created by federal authority, and the same applies to municipalities.
Therefore, Mr. Chairman, it is made quite clear that these were referred to as provincial institutions, and I think hon. members will conclude that the hon. member for Laurier was drawing a very long bow when he suggested that this reference to universities as provincial institutions connoted some thought of making federal contributions to the cost of primary and secondary education. Nothing could be further from the truth. Nothing could be further from the intention of the government.


Lionel Chevrier: May I ask the minister a question? Why then in his table on page

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2410 did he not make the distinction which he is apparently making now?


Donald Methuen Fleming: I am not making any new distinction. I placed the matter firmly on the record of Hansard at page 2410 and these two matters were described under the caption to which I have referred. The matter is perfectly plain. There is no new distinction being drawn. It was placed there in the budget speech on April 9. I say that any suggestion that there is any thought of making federal contributions to primary and secondary education is far removed from the mind of anyone in this chamber.
Let me deal with this subject of university grants. University grants were first introduced by the former government and came into effect in the fiscal year 1951-52. The basis of these grants, while it has changed in amount, has not changed greatly in another sense. They began on the basis of 50 cents per capita of population in the country. They were raised subsequently to $1 per capita and then a year ago were advanced to $1.50. The original scheme contemplated the division of the total federal grant among the provinces on the basis of the respective populations of the provinces, and then within the province the basis of allocation was in relation to university population. The division, therefore, was within the defined institutions of higher learning within the province in proportion to their registration of students who came within the definition in the regulations.
At the beginning there was provision made for distribution within the provinces by a so-called dominion-provincial allocation board, and in the one year in which the universities of the province of Quebec accepted these grants the division in that province was made by a committee or panel composed of the then minister of finance, Mr. Abbott, and the then provincial treasurer of Quebec, Mr. Gagnon. But that was the only year in which the universities of the province of Quebec accepted their share of this provision.


Lionel Chevrier: That was 1951-52.


Donald Methuen Fleming: Yes, 1951-52, and consistently in the years since the universities of the province of Quebec have declined to participate in these grants.


William Moore Benidickson: What is the amount standing to their credit?


Donald Methuen Fleming: 
Lionel Chevrier: May I be allowed just one or two questions following what the minister has said? I have listened with great care to what the minister has said and, in some respects, I must say that I cannot find myself in disagreement with him, other than with reference to some of the suggestions which I made earlier. But I am impressed by the fact that the minister confirms the statements which I made earlier that the present position is a serious one and cannot be allowed to continue indefinitely.
Then, it occurs to me to ask him this, but before I ask the question I may say I appreciate what he has said with reference to the fact that he respects the constitutional position of the provinces in so far as education is concerned and that no proposal having been made to him from the province he feels he should take no further action. Notwithstanding that, the question I now ask him is this. Has any modification of the present formula been considered by the minister or his officials.


Donald Methuen Fleming: Yes. This subject naturally has been given very careful consideration within the Department of Finance.


Lionel Chevrier: Is it the intention, in the light of what the minister has said, to continue the same formula as has been established earlier and has been put into effect by the minister since his party has been in office?

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Donald Methuen Fleming: Item 124 contains its own formula, that is to say, distribution at the first stage among the provinces on the basis of population and then, second, within the provinces on the basis of registration at institutions which qualify. There is not any modification that has been developed yet that seems to meet the need or to supply a solution. Therefore I have said that while there is no modification proposed in this item at the present time or no amendment nevertheless parliament still reserves its jurisdiction over the subject.
These sums are paid over to and held by what was formerly known as the national conference of Canadian universities but is now the Canadian Universities Foundation as trustees. Then as to those amounts that are not claimed by or accepted by the institutions which qualify, they are held by the trustee subject to the directions of parliament. Therefore, parliament still retains control obviously over any unclaimed balance and that unclaimed balance will, if there is no change in attitude, rise this year. That is why I have emphasized the fact that 1 think that is a situation to which parliament can no longer close its eyes. I repeat my own assurance that that is a situation to which I personally am giving the best study of which I am capable.


Lionel Chevrier: May I ask this final question? The minister did not seem to view too sympathetically the suggestion I made in connection with the modification of the arrangement made between the Minister of Finance and the national conference of Canadian universities which was that the money be made payable to the provincial conference of universities. If that modification were acceptable to the universities of the province of Quebec would the minister then be disposed to accept it?


Donald Methuen Fleming: We may be proceeding on a hypothetical basis here, but I indicated that from what I know of the attitude of the province of Quebec, the suggestion that the hon. gentleman put forward would not, as I understand the view in Quebec, be an acceptable solution. I pointed to what happened back in the early days of these grants when there was a dominion-provincial board that made the allocations within the province of Quebec. But here, Mr. Chairman, for the full understanding of the attitude of the province of Quebec, I think one must also have regard to the source of the money. Here the view is taken by Quebec that money that is intended for educational purposes should be raised by the province. Here is a problem of very serious difficulty. That is why, as I presently understand the
[Mr. Chevrier.1
situation, I am very doubtful whether the suggestion put forward by the hon. member will provide an acceptable solution in the province of Quebec.


Lionel Chevrier: Does the minister's answer mean that even if the universities were willing to accept such a modification of the formula as between him and them, he would still not be prepared to amend it in accordance with the suggestion which was made?


Donald Methuen Fleming: I have learned long since-the same as did my hon. friend-not to attempt to give answers to hypothetical questions. I am afraid that at the moment we have gone as far on this subject as we can go because what my hon. friend is putting to me is so clearly a hypothetical question that, frankly, I would not wish to be drawn into an answer on it. We have had no indication at all that the proposal he is making would provide a solution acceptable in Quebec.


William Moore Benidickson: In this context I wonder whether I could ask the minister, as chairman of the treasury board, whether or not he could report to this house any developments in connection with a proposal that was made by our late lamented secretary of state for external affairs, Hon. Sidney Smith, with regard to scholarships. I calculated that this proposal would probably involve $25 million. The proposal came after a suggestion made by the Leader of the Opposition in the same election campaign. I wonder, having regard to our discussion, he thinks there are involved constitutional difficulties similar to those we have been discussing.


Donald Methuen Fleming: I am not aware of any such question being before treasury board, that is to say any question of federal scholarships to university students. I am, of course, aware that through the Department of Labour there are some provisions made for joint dominion-provincial scholarships. Of course they have been in effect for some years. The federal government has made contributions for some years to them. But apart from them, no project of the kind the hon. member described, of which I am aware, has been before the treasury board.


William Moore Benidickson: The minister is, of course, familiar with the constitutional position of cabinet solidarity. The late secretary of state for external affairs in the last election campaign advanced a proposal for a large increase in scholarships contributed to by the federal treasury. As I say, that proposal came after a similar proposal from the

Leader of the Opposition. Has this proposal not come to the minister's attention as chairman of the treasury board?


Donald Methuen Fleming: No, Mr. Chairman. (Translation):


Mr. Flynn:: Mr. Chairman it will come as no surprise to the committee to see me rise following the speech of the hon. member for Laurier (Mr. Chevrier). The member for Laurier never fails to interest me, especially when he speaks for the province of Quebec, a somewhat new role for him. I must say that I do have a peculiar feeling when he says: "We from Quebec, we ask and we say-" Everybody knows, Mr. Chairman, that by far the great majority of Conservative members from Quebec hold university grants to be unconstitutional. The hon. member for Joliette - l'Assomption - Montcalm had expressed his view on this subject last year, as we were reminded by the member for Laurier. The hon. member for Bellechasse (Mr. Dorion) and from Sherbrooke (Mr. Allard) spoke along the same lines. The hon. member for Laurier reminded us also of other statements attributed to me by the press, last September. In this connection, Mr. Chairman, I would like to make a correction right away. What I have said-and this was in a telephone conversation-boils down simply to this: that most Conservative members from the province of Quebec were opposed to grants to universities and that, further, thought was being given to a solution of some kind, grants earmarked for research purposes, for instance. I did not voice this opinion as being my own but as being that entertained by some of my colleagues who were looking for a solution. In this respect I have always believed-and I still believe-that federal grants to universities are unconstitutional.
That is why, after the speech made by the hon. member for Laurier, I deem it necessary to explain my views which may coincide with those of many of my colleagues.
First, there is section 93 of our constitution which gives provinces exclusive jurisdiction over education. Universities are certainly an essential part of our education system. Nobody ever questioned this fact, and jurisprudence, in its interpretation of the word education, upholds this view.
The hon. member for Megantic (Mr. Roberge) who boldly said that the fathers of confederation did not perhaps think of the
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universities when they drafted section 93 because, at that time, Canada had no state university, does not agree with this. His was an extraordinary statement, because, even if no state university existed at that time, at least there were private ones, that is Laval and McGill universities. Anyhow, as the Minister of Finance (Mr. Fleming) stressed earlier today, when the time came to establish universities in this country, they were established by provincial authorities.
Indeed, we should not forget that section 93 has a particular significance for the province of Quebec. It is recognized that when confederation was being prepared, French-speaking Canadians of Lower Canada considered section 93 essential for the preservation of their culture, their language and their own individuality. They looked upon that constitutional structure as the essence of their survival. At that time, the province of Quebec was the only French-speaking of the four confederated provinces. Today, while it is the only one in ten, it considers absolute control in this field as more than ever necessary, as an essential guarantee for the preservation of its own individuality, which it believes should be preserved and cultivated for the benefit of Canada as a whole seeing, in short, French culture as serving the Canadian nation.
Mr. Chairman, I am otherwise aware it has been said that we could give grants to universities because nothing in the constitution prevents us from taking out amounts of the consolidated revenue fund in order to make donations to universities.
In that connection, it was recalled that the province of Quebec had made gifts to Toronto and Ottawa universities.
I admit that a genuine gift is constitutional. However, I believe that regular, annual grants do not constitute gifts; they are annuities paid to universities. Moreover, when grants are voted each year, it is just as if some legislation were voted which would establish them on a permanent basis. That which cannot be done directly cannot be done indirectly. If parliament introduced some legislation about permanent grants to universities, I would argue that they are illegal. And it is not an annual vote which would change the problem.
Mr. Chairman, reference was also made to a moral obligation on the part of the federal government, because universities are rendering great services to the state. In my opinion, there is no moral obligation in constitutional

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law, when the legal obligation is fully met. And if universities do not receive from the provinces the money they need, it is perhaps because provinces cannot afford to give it to them. Consequently, must we not come to the conclusion that the federal government is taxing more than it should, and ought to hand back to the provinces higher taxation powers?
Others have claimed that it was a purely technical objection. "Those gifts or grants", they say, "are unconditional. What are you worrying about?"
What have we to worry about, Mr. Chairman? Well, for one thing, the future. If universities get into the habit of receiving those grants, they will not be able to refuse them, should our government be run, for instance, by our leftist friends, and if conditions were imposed on grants to universities- grants which the Quebec province cannot accept. There is no threat from that direction at the present time, I agree; such a danger perhaps did not exist under the former government, but to overlook the dangers which may be in store for the future would be a sign of an almost unbelievable lack of foresight.
For that reason, we consider it essential to find a solution which could be acceptable to the public of Quebec. It is for that reason that the statement of the Minister of Finance is welcome. It is also for that reason that we are confident that this government will find an adequate solution. This is the situation which has been inherited. The hon. member for Laurier who, a moment ago, criticized the government, and tried to interpret the meaning given to such grants by the Minister of Finance, would do well to read again what was said in 1951 by the former prime minister, Mr. St. Laurent, when these grants were instituted.
He stated at the time that these grants were merely supplementary to provincial grants. It is clear, therefore, that the government's intention was to help education. The principle laid down thereby was extremely dangerous, but I am confident that the present government will certainly find that solution which it is sincerely looking for.
As long as I am convinced that this government is looking for this solution, I will continue to have faith in it. My confidence extends also, in this respect, to the Prime Minister, to the Minister of Finance and all other members of the cabinet.
In principle, I hold these grants to be unconstitutional, though, in practice, I have every confidence in the government. I am

convinced that, next year, it will come forward with a solution which will be approved by the province of Quebec. The province of Quebec will recognize thereby that, in the present government, there are men capable of recognizing its legitimate aspirations and of understanding why it is so convinced of its exclusive rights in respect of education.


Lionel Chevrier: Mr. Chairman, will the hon. member permit a question?


Jacques Flynn: Certainly, Mr. Chairman.


Lionel Chevrier: Would the hon. member support conditional grants provided they be earmarked for research purposes or for laboratory construction, as was mentioned by a report published in the Montreal Gazette in September 1958?


Jacques Flynn: Mr. Chairman, I thought I had made myself clear in this regard when I said that this was not my opinion-


An hon. Member:: Tell him in English.


Jacques Flynn: -but an opinion expressed by someone else. I certainly think that regular and annual subsidy grants for those purposes are unconstitutional.


Lionel Chevrier: Mr. Chairman, would the hon. member let me ask him a second and final question?
If the grants are gifts and are unconstitutional, as he just said, why is he voting in favour of grants to universities?


Jacques Flynn: Mr. Chairman, the fact of voting in favour of an item, or of not voting at all, or of voting against an item, can be interpreted in different ways. If some members felt that the vote requested by the opposition would create division, I believe that they could, in good faith, vote in favour of those grants, while considering them unconstitutional.
I think that we can put our trust in this government as long as it keeps trying to find a solution. This changes absolutely nothing to the opinion that one may express. You can give whatever interpretation you like to votes cast for or against those grants.
(Text):


[Stage Direction]
Item agreed to.
Miscellaneous grants-
125. Canadian association of consumers, $10,000.
Herbert Wilfred Herridge: Mr. Chairman, I have been quiescent for some time which perhaps justifies my speaking briefly on this item and saying at short length what I intended to say

at far greater length. May I say before proceeding that you will never find anyone in this group voting for an item which we consider unconstitutional.
This item represents a good investment. This organization has done excellent work since its formation in 1947 at which time it was sponsored by leading national women's organizations across Canada. It has several objectives including improvement of living standards of the people; the study of consumer problems; the dissemination of information; the exchange of ideas between the organization and government, the agricultural producers, and trade and industry; the carrying on of a campaign of education and research; and making representations to the government when it sees fit. The organization publishes a bulletin approximately 10 months a year containing much valuable information. In recent months the association has been considering the possibility of attempting to persuade the government to establish a consumer's bureau within some department of government which arises out of the limited funds of the organization which restricts its ability to do research work and because more and more Canadians are interested in the cost of living and standards of quality.
More is done in the United States than in Canada in this direction. In that country there are two non-profit organizations, the consumers' union and the consumers' bulletin organization, which have considerable funds at their disposal which have permitted them to undertake extensive research into standards of quality and in subjects in which the housewife would be particularly interested.
In view of the demonstrated excellent work done by the Canadian Association of Consumers would the government give consideration to the establishment of a consumers bureau within some department of government, even working in co-operation with the Canadian Association of Consumers, with a view to extending the work done by this organization? This could be achieved as a result of some extension of the work done by the national research council. The establishment of a bureau would be a step in the right direction to achieve some of the things we are trying to achieve through legislation such as that which might be brought up at a later stage in this evening's business. Would the minister comment on my suggestion?


Donald Methuen Fleming: Mr. Chairman,
under the circumstances I wonder if my hon. friend would be content if I were to say that I have taken due note of his observations.


[Stage Direction]
Item agreed to.
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126. Institute of public administration of Canada,
William Arnold Peters: Would the minister explain the appropriation not required?


Donald Methuen Fleming: This item of $37,500 for 1958-59 was a grant to the national conference of Canadian universities as a contribution toward the cost of holding the congress of universities of the British commonwealth in Canada in 1958.


[Stage Direction]
Item agreed to.
General administration-
511. Comptroller of the treasury-central office and branch offices administration-further amount required, $155,000.
William Moore Benidickson: Mr. Chairman, would the minister give a statement about his views concerning salary increases for the civil service after two years in office?


Donald Methuen Fleming: Mr. Chairman, in response to the hon. member's question there is really nothing I can usefully add on this subject to what I have said in the house in recent days in reply to questions on this subject.
The matter was reviewed by the pay research bureau, as it is doing constantly. The civil service commission has carried out studies based on the report to date of the pay research bureau. I have had opportunity to discuss this matter with the civil service commission and am still in the course of doing so.


William Moore Benidickson: I believe the civil service commission has completed its report to the minister. Would he be able to summarize the report he has received?


Donald Methuen Fleming: No, Mr. Chairman, I do not think it would be proper to disclose the contents of that report at this point when it is still under discussion between the commission and the Minister of Finance, to whom the commission submits such reports.


[Stage Direction]
Item agreed to.
General items of payroll costs including superannuation payments-
513. Government's share of medical-surgical insurance premiums, determined on such bases and paid in respect of such persons (and their dependents) who hold offices or positions or perform services the remuneration for which is payable out of the consolidated revenue fund or by an agent of Her Majesty or who are contributors as defined in the Public Service Superannuation Act or who are members of the Canadian forces or the Royal Canadian Mounted Police as the governor in council prescribes, $3,500,000.
George James McIlraith: Mr. Chairman, could the minister tell us if it is intended that this

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subject matter shall be dealt with by legislation at the next session or will it be continued as an item in the estimates from year to year?


Donald Methuen Fleming: Mr. Chairman, I do not think I can give the hon. member a final answer on the question as to the form, but I may say to him that we have been working diligently on this matter. It is one of tremendous complexities, as I am sure he will readily appreciate. It is our hope that the benefits will be brought into effect on January 1, 1960, for the benefit of the persons in the government service and that, of course, will include not only persons in the civil service, but the benefits of this medical-surgical plan will be available also to the members of the Royal Canadian Mounted Police and the armed forces and their dependants.
It is expected the premiums may commence in December because, as I have indicated, we hope to bring the plan into effect with benefits from January 1. The precise form of the plan is in course of being determined at the present time. We have consulted a number of interested organizations as to their suggestions for the specifications of the plan. I can assure the committee that the matter is receiving a great deal of study in the hope that we can make a good plan of this when it is inaugurated.


William Moore Benidickson: What is the opportunity of members of parliament, ministers or parliamentary secretaries, in connection with eligibility under this item?


Donald Methuen Fleming: None, Mr. Chairman. The present plan which, of course, is quite limited by comparison has never been extended to include members of parliament or any of those enumerated by the hon. member.
Insurance-
148. Departmental administration, $694,441.


Frank Howard: Mr. Chairman, I understand this is the last item that the minister will be dealing with in connection with his capacity of Minister of Finance other than the supplementary estimates. I may say before it passes that we have had the pleasure of witnessing something this evening that I thought I never would see develop in the house. I would like to commend the minister for the admirable attitude he adopted tonight, and hope that he does not cease, now that he has started, continuing this sort of program and that it will carry over to another session.


Donald Methuen Fleming: In the same spirit may I thank all hon. members for their cooperation, both those who spoke for the

speeches they made, and particularly those who did not speak for the speeches they did not make.


Paul Joseph James Martin: Mr. Chairman, I would like to say to the minister that we on this side forgive him for all that he has said about us.


Charles Edward Rea: This completes the estimates of the Department of Finance. There are a few supplementary items to go through yet.



DEPARTMENT OF CITIZENSHIP AND IMMIGRATION

[Stage Direction]
Citizenship-
500. Citizenship registration branch - further amount required, $121,780.
John Whitney Pickersgill: I do not expect an answer from the hon. lady. I just want to renew the plea I made twice before that there should not be deportations, or the threat of deportations, of the parents of small children who are Canadian citizens.


Ellen Louks Fairclough: Mr. Chairman, the hon. member surely realizes that this is citizenship registration and has nothing to do with immigration.


John Whitney Pickersgill: I am quite well aware of that, but I am referring to citizens and the parents of citizens.


[Stage Direction]
Item agreed to.
National Gallery of Canada-
547. Administration, operation and maintenance- further amount required for the completion of the permanent Canadian pavilion at the Venice international biennale of art, $10,000.
William Moore Benidickson: Has there been any change in the salaries made available to the chairman of the civil service commission who has been newly appointed?


Donald Methuen Fleming: No, Mr. Chairman; he receives the same salary as the former incumbent.


[Stage Direction]
Item agreed to.
DEPARTMENT OF LABOUR A-Department-General administration-
529. Departmental administration, including the expenses of the international labour conferences- further amount required, $11,700.
Paul Joseph James Martin: The Minister of Labour is not available at the moment and this would seem to be an appropriate occasion to ask the Prime Minister, or perhaps the Minister of Finance, although I think tonight we would prefer to hear the Prime Minister-most of us feel we have heard enough of the Minister of Finance-


Donald Methuen Fleming: Too much for you?


Paul Joseph James Martin: -as to the government's intentions with regard to the winter works program. The Minister of Labour has not given us satisfactory answers on this question. When we recall the situation that prevailed in this house last summer, when the Leader of the Opposition in particular reminded the government that there was likely to be a high level of unemployment in the fall of 1958 and in the winter of 1959, and on that account it would be wise to take preparatory steps so that any government program designed to put unemployed people to work during those two periods could be taken with a maximum result. In view of that experience we feel, notwithstanding the questions that have been put to the Minister of Labour during the course of the past month, we should take advantage of this last opportunity to ask the Prime Minister whether the government, in the face of certain indices indicating some measure of unemployment next winter, will not take the committee into its confidence at this time so that the kind of situation deplored the other day by the mayor of Ottawa could be obviated and municipalities could be given an opportunity to prepare their budgets for schemes that are designed to put men and women to work.
We were not satisfied, of course, with the results of the winter works program last year, a program that put some 35,000 men to work out of half a million of unemployed in our country. That scheme, inadequate though it was, was better than nothing. It would seem, in order to make it more effective, that advance notice well ahead of time should be given to municipalities and to provinces so that they could be made aware of the government's intention. The result would be, I am sure, that next spring, assuming the existence of unemployment on something like a comparable or even on a lesser level, the problem would have been more effectively mitigated than was the case this year.
It is not good enough to have the government announce its program, as it was announced last year, in the middle of the fall, at a time when the provinces and the municipalities could not take full advantage of the government's proposal. While the economic situation in the country would seem to bear promise of an improvement-and we all hope that is the case even beyond the indications given by the Minister of Finance -there are indices that point to the fact that there will be unemployment again next fall and winter. The level may not be apparent or fully known but that it will exist I think is incontestable. That being 66968-9-406
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the case, I hope on this the last night of the present session the government will take parliament into its confidence and announce its intentions so that the necessary and preparatory steps can be taken.
I am sure the Prime Minister is seized with the importance of this situation and I hope that he will be able to take advantage of the opportunity now afforded to him of announcing to the country what the government's policy in this particular will be.


John George Diefenbaker: Mr. Chairman, certainly these last hours of the session do reveal a tremendous change in the thinking of the hon. gentleman. He started off this session by picturing dire and terrible unemployment and mounting unemployment situations. I presume that these are almost his last words in this session. He says that while the economic situation would seem to indicate improvement there should be some announcement made regarding a winter works program. Certainly, Mr. Chairman, such a material change in the gloomy outlook of the hon. gentleman indicates that he too, in common with Canadians as a whole, has a realization of the tremendous economic upsurge in this country in the last few months. I know that he is just as desirous as everyone else to note this improvement and that he will be very pleased with the economic change that has taken place which we, with becoming modesty, are able to say we contributed to by the policies which we introduced. With respect to the question asked by the hon. gentleman


Paul Joseph James Martin: That was what I was interested in.


John George Diefenbaker: I must say I have learned from the hon. gentleman because he usually starts off at length regarding matters that are not covered by the question before he asks the question.


Lionel Chevrier: The Prime Minister has nothing to learn in that respect.


John George Diefenbaker: I want to say that the Minister of Labour is watching this improvement with the greatest of interest and also with the anticipation that it will continue.
In so far as the winter works program is concerned, we are very proud of the record that was established in employment as a result of the introduction of this plan and as events transpire within the next few weeks a decision will be made in lots of time, in the event that it is decided to proceed with the plan, to assure that the success of last winter will be multiplied and the number employed under the plan during the coming winter.

Supply-Labour


Lester Bowles Pearson: Mr. Chairman, this tremendous economic upsurge about which the Prime Minister has spoken does not alter the fact that there is still a greater percentage of unemployed in this country than in the United States or the United Kingdom. While seasonal and other considerations have reduced the number during the summer, seasonal factors will soon be moving against employment. What we are asking is that plans should be made now to take care of this situation if this autumn and winter there should be abnormal unemployment. When this matter was brought up a few days ago the Minister of Labour had this to say as found on page 5958 of Hansard:
We hope the situation will be such that it will not be necessary to have this program repeated.
Also we hope the situation will be such that this program will not have to be repeated. But this government has an obligation to plan against that situation, to plan in advance a winter works program to take care of the situation if we should have abnormal unemployment. It is not good enought for the Prime Minister to say tonight that they are considering the matter. It is not good enough for the Minister of Labour to say, as he did on July 14:
Whenever further consideration has to be given to this problem because of circumstances which may arise, this government will always look sympathetically on the matter.
It is not good enough to look sympathetically on the matter of winter unemployment. It is more important to plan in advance with the provinces and municipalities so that such unemployment can be reduced, not by 35,000 out of 600,000 as was the case last winter but more effectively than that.


John George Diefenbaker: I do not want to add to the discussion at this time except to say my information is that so great has been the upsurge that at the present moment there are 200,000 more employed in Canada than at any other time in our history.


William Moore Benidickson: Population increase.


Herbert Wilfred Herridge: Because of the strong concern of this group about this problem I cannot resist saying a word or two. I cannot resist reminding the Prime Minister that when it was raining in the winter months and we were suffering from widespread unemployment the government did not take credit for that but blamed factors over which they had no control, lack of foreign markets, international conditions, and compared our circumstances with those in the United States, but I notice now that he is taking the credit when the sun shines.
I want to join with the other speakers in urging the Prime Minister to plan now for
rMr. Diefenbaker.]
any unemployment that may develop next winter. Not only is it to the advantage of the human beings concerned but it is to the advantage of the country as a whole to avoid the unfortunate waste that goes with large scale unemployment.


William Moore Benidickson: May I just add that I hope the Prime Minister will take into consideration along the same line the winter works opportunities available under the northern affairs votes for picnic grounds and forest access roads. We know that in 1958 the announcement was made in November. The starting date was December and the provinces were not capable of taking advantage of the program until well on into the winter. I hope that some assurance will be given that this will be continued.


[Stage Direction]
Item agreed to.
Resolutions adopted in committee of supply this day reported and concurred in.

['In answer to the first question, the intention is to proceed as rapidly as possible with the appointment of the energy board. With regard to the second question, it is expected that the second report will be presented soon. I cannot give the exact date.']
Donald Methuen Fleming: that the house go into committee of ways and means.
Motion agreed to and the house went into committee, Mr. Rea in the chair.


Donald Methuen Fleming: That towards making good the supply granted Her Majesty on account of certain expenses of the public service for the fiscal year ending March 31, 1960, the sum of $2,509,880,956.37 be granted out of the consolidated revenue fund of Canada.


[Stage Direction]
Motion agreed to.
Resolution reported and concurred in.
Mr. Fleming (Eglinton) thereupon moved for leave to introduce Bill No. C-73, for granting to Her Majesty certain sums of money for the public service of the financial year ending the 31st March, 1960.
Motion agreed to, bill read the first and second times and the house went into committee thereon, Mr. Rea in the chair.
On clause 1 -Short title.
['That towards making good the supply granted Her Majesty on account of certain expenses of the public service for the fiscal year ending March 31, 1960, the sum of $2,509,880,956.37 be granted out of the consolidated revenue fund of Canada.']
Herbert Wilfred Herridge: Can the minister assure the house that the language of this bill is in exact terms with the usual bills?


Donald Methuen Fleming: Yes, the bill follows the established form. There are no departures from that established form.


[Stage Direction]
Clause agreed to.
Clauses 2 to 5, inclusive, agreed to.
Schedule A agreed to.
Schedule B agreed to.
Preamble agreed to.
Title agreed to.
Bill reported.

64D1
['Yes, the bill follows the established form. There are no departures from that established form.']
Mr. Speaker:: Is it the pleasure of the house that the bill be read a third time now by leave?


Some hon. Members:: Agreed.


Donald Methuen Fleming: the third reading of the bill.


[Stage Direction]
Motion agreed to, bill read the third time and passed.

[Stage Direction]
The house resumed from Tuesday, July 14, consideration of the motion of Mr. Fleming (Eglinton) for the second reading of and concurrence in amendments made by the Senate to Bill No. C-48, to amend the Income Tax Act.
Donald Methuen Fleming: Mr. Chairman, this matter was before the house on July 14, just four days ago. I hope, for that reason, I can abbreviate these few remarks. The Senate introduced two amendments to the bill to amend the Income Tax Act, Bill No. C-48, and those are to be found on page 579 of Votes and, Proceedings of June 18. As I mentioned on July 14, the first amendment is very simple. On page 11, line 16 of the bill, it is proposed, after the word "or" to insert the word "charterparty". As I mentioned on Tuesday, Mr. Speaker, this is purely a drafting matter and there is no question whatever of substance involved. It is suggested, for that reason, that the amendment be accepted.
However, on the second amendment, some discussion ensued when the matter was before the house on Tuesday. By that amendment the Senate proposed to strike out clause 19 of the bill which is found on page 11 of the bill. You will recall, Mr. Speaker, that in the debate on July 14 the house expressed itself in firm terms on the principle of amendments by the Senate to money bills. The Leader of the Opposition said, as recorded on page 5982 of Hansard for that date:
Mr. Speaker, it seems to me that a very important constitutional principle is involved in this matter. I am sure we all feel that we have a duty to ensure that the rights and privileges of this house are not violated, circumscribed or abridged by any action which we might be taking arising out of action taken in the other place. The rights and privileges of the House of Commons are well known in this matter and the limitations on the action of the other house in respect of those rights and privileges are also well known.
Further along, he referred to my remarks to the effect that the government accepted this course, perhaps reluctantly. Then, he said:
If the government's reluctance was due to the substance of the amendment in question, it seems 66968-9-4064
Income Tax Act
to me all the more surprising that the government would take this particular course. If the government's reluctance is due to misunderstandings which may be created in the future because of the procedure we are following and because of the possible effect of that procedure on the rights and privileges of this house, then it seems surprising to me that having this reluctance the government would pursue this particular course.
The government made quite clear its view on this matter. The Prime Minister (Mr. Diefenbaker) in his intervention in the debate confirmed very plainly the rights and privileges of this house in the matter of money bills, and reaffirmed the established principle, well recognized in this house, that while the Senate may reject money bills it may not amend them. I wish to remind the house that in introducing the matter I said this at page 5978 of Hansard:
I wish to emphasize, Mr. Speaker, that the government does not concede any right or power on the part of the Senate to amend money bills. Had this been a more serious matter, or had this amendment related to something affecting the revenues, I would have considered it my duty to challenge any infraction of the privileges and rights of this house thereby created.
It was made clear that this clause 19 was not introduced into the bill with the object in view of enlarging the revenues. It was introduced with a view to abridging what was regarded as a discrimination or favoured position enjoyed by foreign business corporations under the Income Tax Act here. In the light of the views expressed in the house, the government is pleased to reaffirm, reemphasize and reassert the principle that money bills passed by this house may not be amended in the other place.


William Moore Benidickson: Even a reduction in
taxation?


Donald Methuen Fleming: May not amend money bills, is the time honoured reply, and for that reason the government is proposing a somewhat different course on this occasion.
I shall mention only very briefly the background of the amendment itself. I give this merely because the hon. member for Kenora-Rainy River (Mr. Benidickson) asked some questions on this subject on Tuesday. If the house continues to share the view of the principle at stake in the constitutional aspects of this matter then I take it that the house, having spoken on an earlier occasion on this subject, namely May 4, will desire to affirm the position it took at that time and reject the amendment proposed by the Senate in striking clause 19 out of the bill.
Let me very briefly say that the effect of clause 19 of the bill was to close the class of foreign business corporations which under section 71 of the Income Tax Act now enjoy exemption from taxation under that act.

Income Tax Act
These corporations, by paying a tee of $100 and proving qualification in other respects, completely escape taxation under the Income Tax Act. While this provision goes back actually to 1918, to the very early days of income tax, it was introduced at a time when the position of corporations doing business outside of Canada was very different from the position that is accorded to those corporations today.
This provision of the act allowing corporations to become foreign business corporations dates from a time when there was no provision for a credit for foreign taxes nor any provision for tax freedom on dividends from foreign subsidiaries. Canadian corporations may now obtain a credit for taxes imposed by foreign governments on their operations abroad, or if they own or control subsidiaries abroad to the extent of owning at least 25 per cent of the shares they may bring dividends from those subsidiaries back to Canada free of Canadian tax. In view of these provisions there seems to be no longer any need for Canadian corporations to use the foreign business corporation classification in order to carry on operations abroad.
I do not wish to detain the house any longer than is strictly necessary. In this respect I can, if the house wishes, go into this subject at greater length but I hope that will not be necessary. There is an abundance of evidence that the circumstances which called this type of exemption into being 40 years ago no longer obtain. I remind the committee we are not taking anything away in clause 19 of this bill from any corporation that had qualified up to the night the budget was brought in or was in a position then to qualify, but the effect of the amendment was to close this class so that no more corporations could, under present circumstances, acquire rights under it.
I said at that time that the closing of this class would give us an opportunity to go into this subject at greater length in our studies to determine what value, if any, there was to Canada in allowing corporations which have no assets in Canada or property in Canada to enjoy this particular form of tax exemption. I will therefore not dwell on that subject unless hon. members so choose. But I come back to the principle which I submit is well recognized in this house and which, for my part, I am glad to have the opportunity to ask the house to reassert on this occasion. It is a proposition that is described by Bourinot in his fourth edition at page 285, in these words:
-the Senate is now practically guided by the same principle which obtains with the House of Lords and acquiesces in all those measures of taxation and supply which the majority in the House

of Commons have sent up for their assent as a co-ordinate branch of the legislature.
May I simply close my remarks on this aspect of the matter by recalling the words of Sir Wilfrid Laurier in this house in a similar situation on September 7, 1917. This is the way in which Sir Wilfrid put it, and I am sure the house will not question the assertion of Sir Wilfrid on a constitutional question. He said this:
It is a well-known principle that the upper chamber can reject any bill, even though it deals with financial matters, that has been passed by this house. The Senate can reject the supply bill; it can reject a bill adopted by the committee of ways and means of this house, but it cannot amend such bills. This principle has been affirmed over and over again.
On this occasion I am asking that the house reaffirm the principle. I am therefore moving, Mr. Speaker, the following motion, seconded by my colleague the Minister of Trade and Commerce:
That a message be sent to the Senate to acquaint Their Honours that this house agrees to the first amendment made by the Senate to Bill C-48, an act to amend the Income Tax Act, being an amendment to clause 18 of the said bill, but disagrees with the second amendment, whereby the Senate would strike out clause 19 of the said bill, for the following reasons:-
1.	The outright exemption of foreign business corporations from tax under the said act should not be extended to corporations which have not qualified or cannot qualify as foreign business corporations in accordance with the provisions of the said clause 19.
2.	The class of tax-exempt foreign business corporations under section 71 of the said act should be closed pending a review of the position of such corporations and the value to Canada of permitting more corporations to qualify as such.
3.	The said amendment of the Senate infringes the sole and undoubted right of the Commons to impose taxation; it alters the application of taxes and interferes with the public revenue.


Mr. Speaker:: Before the Leader of the Opposition speaks, may I say this. I take it that the Minister of Finance considers that the proposed amendment does not now infringe on standing order 63 by reason of the fact that the remaining amendment does not alter any of the conditions, etc., of the grants involved.


Donald Methuen Fleming: Exactly so, Mr. Speaker.


Lester Bowles Pearson: Mr. Speaker, when the government submitted to the house this Senate amendment the other day, the position we took then on this side with regard to the procedure was the position which has been put forward by the minister today and which has been embodied in this motion. We are therefore naturally gratified that the government has taken this position and we will support it. I should like to add, however,

an expression of hope that as to the substance of the matter contained in the Senate amendment, which we think had much to recommend itself, the government will give consideration to that matter with a view perhaps to bringing in next year the kind of amendment which the Senate submitted to the house and which we thought was an improvement. However, as far as the procedure is concerned, we think that nothing should be done which can infringed in any way the rights and privileges of this house by Senate action. As I have said, we are therefore gratified that the government has taken the course we recommended the other day.


Herbert Wilfred Herridge: On
behalf of this group, Mr. Speaker, I want to say that we are very pleased indeed that the Minister of Finance has made this announcement tonight. In so doing, he has shown a willingness to support the argument put forward by the hon. member for Vancouver East (Mr. Winch) on behalf of this group, when he first introduced the legislation. It is another illustration of the effectiveness of the opposition.


[Stage Direction]
Motion agreed to.

Edmund Davie Fulton: the second reading of Bill No. C-70, to amend the Combines Investigation Act and the Criminal Code.
He said: Mr. Speaker, this bill has been the subject of discussion between representatives of the various parties and has also, as you will recall, been the subject of an earlier statement by myself as to our intentions with respect to its disposition. On July 7 I made a statement as to the government's intention and at that time indicated that by leave of the house I intended to divide the bill, leaving over for next session those portions of the original bill which deal with amendments to combines, mergers and monopolies provisions, leaving for consideration at this session only the portions dealing with small businesses and an additional section introduced on that date to take care of a situation arising in the fisheries industry in British Columbia as a result of the report of the director of investigation and research under the Combines Investigation Act. Accordingly, our original bill was dropped and a new bill, namely Bill No. C-70 now before the house, was introduced.
Combines Investigation Act
This bill consists of four clauses. The first three are those dealing with the situation of small businesses. First, there is a clause to deal with misleading advertising; second, a clause to deal with the situation arising under section 34 of the present Combines Investigation Act; and, third, a clause dealing with unfair pricing practices. Then the fourth clause is the one introduced to take care of the fisheries situation in British Columbia.
Since that time-that is, since July 7 when I made my previous statement-I have to advise the house that I have received a number of further representations, both from members of the house itself and from organizations throughout the country, to the effect that the provisions of the first three clauses, while important and while dealing with an urgent situation, nevertheless require further consideration. I have received representations from such organizations as the Co-operative Union of Canada pointing out that in their view the bill in its present form would confront them with certain problems about which they are gravely concerned. As I have said, other organizations as well as members of parliament have represented that the bill requires a great deal of study and should have further consideration.
I must say, Mr. Speaker, that the interest and concern which have been shown in connection with this bill are to me an indication of the importance of the subject matter with which it deals. This bill, as it now stands with respect to the first three clauses, is an attempt-and I believe it will be an effective and useful attempt-to deal with extremely grave difficulties now confronting small businesses in this country.
I would have liked to proceed with the bill at this session for the reason which I indicate, namely the urgency of the problem which confronts these small businesses. But by reason of the importance of the situation and of the importance of our economy of maintaining the maximum number of small, independent private enterprises, I consider it is our duty to ensure that the legislation we introduce be in the best, most effective and most workable form.
Therefore, in view of the number of representations I have received-I must say I have had some criticisms, although the criticisms have been outnumbered by the constructive and helpful suggestions-as. to the desirability of further consideration of some changes which might be made, I consider that to proceed with the bill at this stage of the session would not be helpful in view of the obvious proximity of the closing of the

Combines Investigation Act session, which might indeed mean that we would pass a bill in a form which was not the best form that such legislation could take. While I recognize, therefore, that to delay the bill would be a matter of real concern to the small businesses of this country and the organizations which speak for them, I would ask the house, and will ask those organizations and others concerned in the matter, to believe that their interests may well be better served by giving a little further time for reflection on the legislation which has now taken concrete form, in the hope that in the interim we may receive further constructive suggestions and in the belief that those suggestions will help us to bring in legislation which will be the best we can devise to meet the problems that I have discussed. Therefore I would ask the house for its consent, when we get into committee, to move that the first three clauses be deleted.
I announce it now as the firm intention of the government to re-introduce the legislation at the next session. I do not say that it will be in exactly the same form because we will be considering the suggestions which are made in the interim, as I am sure they will be, by small business organizations themselves as well as by others. But I do announce now that it is the firm intention of the government to re-introduce legislation along these lines at the next session and to proceed with and deal with that legislation at that session.
Mr. Speaker, I realize that a motion to delete clauses 1, 2 and 3 is in effect an expanded negative and would therefore not normally be in order; but it seems to me to be the neatest way to deal with the problem which confronts us, if the house itself agrees with me that it would be a wise course to defer consideration of those three clauses at this time. I will not ask for the deletion of clause 4, because for reasons which perhaps I can discuss better in committee it is, I consider, urgent that we enact clause 4 so as to take care of the situation in British Columbia in the fishing industry which would result if we did not bring in this exemption from the operation of the act for a two-year period. It is on that basis, therefore, Mr. Speaker, that I would ask the house to consent to second reading at this time on the understanding that I will ask one of my colleagues to move in committee that the bill be amended by the deletion of the first three clauses.


Lester Bowles Pearson: Mr. Speaker, the course which has been proposed by the minister seems to us in the circumstances to be a sensible one.
[Mr. Fulton.1
We will agree to second reading on the understanding that that course will be followed in committee.


Frank Howard: Mr. Speaker, that represents our position with respect to the proposal made by the minister, which appears to be a commendable attitude at this stage in view of the importance of the legislation itself. I would suggest, though, that the minister in re-introducing amendments to the Combines Investigation Act and the Criminal Code in so far as combines are concerned, attempt to have the legislation drafted for introduction as early as possible at the next session. I would also ask him to consider having the bill itself referred to perhaps the banking and commerce committee in order that a little more exhaustive study may be given to it than could be given in committee of the whole.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Sevigny in the chair.
On clause 1-Misrepresentations as to ordinary price.
Edmund Davie Fulton: Mr. Chairman, in accordance with the undertaking I gave on debate on second reading, I would ask one of my colleague to move that clauses 1, 2 and 3 of Bill No. C-70 be deleted, and that clause 4 be renumbered clause 1 of the bill.


Gordon Minto Churchill: the following amendment:
That clauses 1, 2 and 3 be deleted and that clause 4 be renumbered as clause 1.
Motion (Mr. Churchill) agreed to.
On clause 4 (renumbered 1)-Application of acts to fishing agreements.


Frank Howard: Mr. Chairman, I would like to make a comment or two on clause 1, because of the particular effect it will have on the situation in British Columbia so far as the fishing industry is concerned. I suggest that it has always been the understanding that the present section 4 of the Combines Investigation Act and the particular subsection in one part of the Criminal Code which says this shall not apply to employees or workmen afforded reasonable protection in themselves and always has been construed, in any event to means that fishermen on the west coast bargaining through their union with the fisheries association or with the fishing companies have been excluded from the provisions of the act. It certainly came as quite a shock to the native brotherhood of British Columbia, and to two or three other organizations of fishermen as well as to the companies themselves, that they should have been

considered, at least by Mr. McDonald in his statement of evidence, as having operated over the years through what was considered to be a process of normal collective bargaining, and by that collective bargaining to have operated in contravention of the statute itself. This will place, in effect, a moratorium on that suggestion of alleged illegality under the statute for this year and for next year.
It has been suggested that this should be included now, or drafted in such a way as clearly to indicate that the act will not apply to fishermen in the conduct of their affairs, not only on the west coast-I notice this confines itself specifically to British Columbia- but to other parts of Canada. Although there may well be in other parts of Canada similar organizations, unions and collective bargaining processes between fishermen and the employers in the industry, who have been carrying on their collective bargaining processes in precisely the same way as is done in British Columbia, they may yet find themselves not protected by this particular clause inasmuch as it is restricted to British Columbia.
I realize that it is most unwise to attempt to draft legislation in committee because the changes and amendments advanced by hon. members sometimes fail to meet the situation they are intended to meet but for the two reasons with which I dealt I am going to advance a proposal for the consideration of the minister although I do not advance it as a formal amendment. I would propose deleting everything after the word "apply" in the second line and substituting therefor the words "to combinations of fishermen for their own reasonable protection". That portion of the clause would then read:
Nothing in the Combines Investigation Act or in section 411 of the Criminal Code shall be construed to apply to combinations of fishermen for their own reasonable protection.
The minister may consider that this wording does not adequately meet the problem but I put forward this suggestion to cover the two points I mentioned. Fishermen should not be in a position of wondering whether they have committed an offence, and this should not be restricted to British Columbia because fishermen elsewhere may be engaging in the same type of activities.


Lester Bowles Pearson: Mr. Chairman, may I state that we on this side do not consider that this kind of collective bargaining represents a combine. We agree with the hon. member who has just spoken that any doubts on that matter should be removed. We would be interested to hear the minister's reaction to the suggestion that has just been made to that end.
Combines Investigation Act


Edmund Davie Fulton: Mr. Chairman, I appreciate the remarks that have been made by the Leader of the Opposition and the hon. member for Skeena. There were two questions raised. The first one raised by the hon. member for Skeena was whether the act should be made of more general application. I believe the answer to that is that so far as I can ascertain there is no situation anywhere else in Canada comparable to the situation in the fishing industry in British Columbia, for a variety of reasons. As far as I am aware that is the only place where there is an organization calling itself a fishermen's union that operates in the way this one does with agreements with companies, and so on. Whether I am right or wrong in saying it is the only place where this method of bargaining or price setting takes place, the fact is that this is the only area in which such activities on the part of fishermen and fishing companies are now being investigated.
We considered it very carefully. It was my thought that in making an exemption of this type it would be desirable to confine it as narrowly as possible. We are making an exemption from an act of general application and therefore I believe it is wise to confine the exemption only to those cases where such an exemption is demonstrably necessary.
With regard to the second question as to what should be our attitude toward the bargaining activities carried on between the U.F.A.W.U. and the fish packing companies and as to whether or not such bargaining activities should clearly be exempted from the Combines Investigation Act, I am sure my hon. friends would not expect me to make any definite commitment at this time until I see the report that will be made by the restrictive trade practices commission.
When we receive that report we will have to consider first of all whether it discloses an offence. If so, we will then have to consider whether or not we should institute legal proceedings. I think I should say that possibly our final decision cannot be made until after any legal action which is instituted shall have been determined and we get the decision of the court.
I am quite satisfied that the union will raise the point that it is a union within the meaning of the word as used in the combines act and therefore that its activities do not come under the provisions of that act. That will be a question before the commission and depending upon the finding of the commission it may be a question before the court. The question, as I understand it, is whether in fact this is a union of employees or, rather, an association of independent producers or fishermen.

Combines Investigation Act
I am not going to say any word which would indicate that I prejudge that situation or the answer to that question. I would only say that when we have the report of the commission and possibly-if this should be the case and if it should go to court-the decision of the court, then depending on that report and/or that decision it will be necessary for consideration to be given to the question which may be stated in these terms. If it is decided as a matter of policy that this type of bargaining activity is desirable and should be allowed to continue unfettered by the Combines Investigation Act, then consideration will have to be given to the question of whether or not some appropriate legislative action should be taken by either the provincial or federal authorities, as the case may be, to ensure that the arrangements that it is desired as a matter of policy to allow to continue should be allowed to continue under the protection of whatever legislative umbrella may at that time be thought to be appropriate and in accordance with proper policy.
I do not think I could usefully add very much more at this time without being in danger of prejudging the case or of suggesting some commitment which at the present time it would be improper for me to make. I will only say that it seems to us that the wisest course-indeed the sensible course on all counts-is to introduce the present provision by virtue of which whatever has been done in the past may be continued in the present and for the two-year period ending on December 31, 1960, without any possibility of prejudice to any party, whether it be the union or the companies, notwithstanding whatever may be the finding of the commission or the decision of the court, if legal proceedings are instituted. In that way I think we are preserving the status quo without any possibility of penalty or prejudice. This will give all parties, including the governments, time to take a good look at the situation and decide what is the sensible course to follow in the light of the situation that may be disclosed following the finding of the commission.
Another question with which I should deal is that of the proposal which my hon. friend said he would like to have moved as an amendment. I appreciate his intention in this matter, but I think I should point out to him that such an amendment would not answer the situation because it would not take care of the case of the companies; although I am not saying that the case of the companies is right or wrong.
Here we have a situation where there is bargaining between the U.F.A.W.U. and the companies. I do not think we can take care


of that situation by saying the unions only are protected because then the unions would have protection, but the companies which have to be parties to the same agreement which may be contrary to the act, would not be protected. So that if we adopted the amendment of my hon. friend, which merely covers the union, it would not protect the companies if they decide to continue those negotiations in the interim period during which we are trying to protect all parties.


Frank Howard: Mr. Chairman, the lucid and detailed explanation and argument of the minister in regard to the two questions I submitted should be considered. However, at this time I should like to deal with the question of confining it to a geographic area. The minister says he has not been able to discover a condition existing in Canada similar to that which exists in British Columbia in so far as the collective bargaining processes are concerned. I do not know. That may be true. I am sure it is correct that such a situation does not exist at the moment.
But there is this possibility which might arise. In as much as the government and the minister are intending to allow certain processes to take place in British Columbia, notwithstanding what they may have been doing in the past, I believe we should consider this possibility. It may arise this year or next year some time that in the fishing industry in some other part of Canada they will develop a union similar to the U.F.A.W.U. which might carry on negotiations under the collective bargaining processes in the same manner as does the U.F.A.W.U. with the fishing association of British Columbia. If that condition does arise then I believe we would be well advised to take cognizance of the possibility of it existing, and perhaps the words "in British Columbia" in the two instances where they appear should be removed. It will not be upsetting anything, and it will be guaranteeing some sort of legislative protection to other people in similar activities in other parts of Canada in case the condition does arise.


Edmund Davie Fulton: I think I can dispose of my hon. friend's concern by saying it is scarcely likely that the combines branch would institute and press another inquiry into a similar situation if one exists, or if one should arise, until this inquiry is finally disposed of. I make that comment as minister. I think it is scarcely likely that such an inquiry would be pressed until this one is disposed of. At that time we will have to decide how to deal with such situations wherever they may exist in Canada.


Frank Howard: May I express another thought on that, Mr. Chairman. Until this particular investigation started, in so tar as the fishermen of British Columbia are concerned, was not that section of the act-I forget the precise part of it-the section which states that any six citizens in Canada can-if they make a statement of evidence to the effect that because of the conditions existing they think there is a combine existing-start the ball rolling in so far as an investigation is concerned, and the director then is duty bound to proceed with such an investigation, as was done in this case. There is the possibility but I do not say it will arise. Suppose the Newfoundland fishermen decided to establish a union, I think it would be a commendable thing for them to do there-


An hon. Member:: It would be outlawed.


Frank Howard: If they decided to do that and if they commenced bargaining under the same process with a company there as was done in British Columbia, could some six citizens- I hope they are not all Liberals-decide to start the ball rolling toward an investigation, and the director would then be duty bound to proceed in so far as the conditions existed at that particular moment. They might fall within this two-year period. Just to cover the possibility I think the minister should undertake to remove the words "British Columbia" which appear in this clause.


Edmund Davie Fulton: I still think, Mr. Chairman, it is sounder to confine the exemption only to those situations that demonstrably require to be covered by the exemption.
I want to reassure my hon. friend that, although he is perfectly correct, if there should be established another union similar to the one in British Columbia and if negotiations between it and fishing companies should take place and if six people formally made representations to the director, he is quite right, the director would then have to institute an inquiry.
We discussed this matter on my estimates in the light of some criticisms then made. These inquiries take a long, long time between the first step taken by the director and the final disposition by the courts, or indeed even by the restrictive trade practices commission. That is quite true. I think, therefore, I am quite safe in saying to my hon. friend that in the situation he envisages we could count on the final disposition of the British Columbia case before an inquiry in some other part of Canada had produced any prejudice to any party who might be involved.


Frank Howard: One other point. I guess I did not try hard enough. I am going to get
Bridges
a change made in this clause somehow or other. I think I had better do it in a formal way and the minister will see how necessary it is to have some watchdogs over on this side of the house. I would point out to the minister that the last word on the fourth line of clause 1 is "Colombia". It is misspelled. It should have a "u" in there. Accordingly,
I would like to move.
That clause 1 be amended by deleting in line 4 thereof the misspelled word "Colombia" and substituting therefor the word "Columbia".


Edmund Davie Fulton: I shall be glad to accept the amendment.


[Stage Direction]
Amendment agreed to.
Clause as amended agreed to.
Title agreed to.
Bill reported, read the third time, by leave, and passed.

Donald Methuen Fleming: the second reading of Bill No. S-30, to authorize the construction of a bridge across the Niagara river between the province of Ontario and the state of New York.


William Moore Benidickson: Is that a toll bridge?


[Stage Direction]
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Sevigny in the chair.
On clause 1-Approval of bridge.
Donald Methuen Fleming: Mr. Chairman, this bill has nothing to do with the maintenance or operation of the bridge. There will have to be legislation next year dealing with that. This bill has two purposes and two only. It is based on the urgent request of the province of Ontario. The first purpose is to permit the construction of a new bridge across the Niagara river between Queenston on the Canadian side and Lewiston on the United States side. The second purpose is to enlarge the powers of the Queenston Heights Bridge Company to make it quite clear that it had the power to sell the present bridge to the Niagara bridge commission.


Paul Joseph James Martin: The Leader of the Opposition suggests that I ask this question. Can the minister explain why in clause 3 the lieutenant governor is given the power to designate an authority that might not be a resident of Canada? Indeed, the authority might be an American authority. Would the minister, knowledgeable as he is on this and on so many other matters, give me a reply that would be adequate to the occasion?

Bridges


Donald Methuen Fleming: I thank my hon. friend for his overwhelming flattery. I never thought 1 would live to see the day, or I should say the night, when I would hear that. It is very agreeable indeed.
Perhaps we are getting ahead of ourselves when we talk about clause 3, but the fact is that the Niagara bridge commission exists under legislation of congress and it is a rather extraordinary thing that the provision that is made for appointment to the membership of that commission of certain representatives of Ontario exists not by virtue of legislation passed in Canada but by legislation passed at Washington. I am informed that following the enactment of the present bill further legislation will be required to be enacted by congress and also by this parliament next year dealing with such questions as the one asked by the hon. member for Kenora-Rainy River. But the purposes of the bill are quite simple and, as hon. members realize, the bridge will connect the New York thruway and the Queen Elizabeth way.


[Stage Direction]
Clause agreed to.
Clauses 2 to 8 inclusive agreed to.
Title agreed to.
Bill reported, read the third time and passed.

Donald Methuen Fleming: the second reading of Bill S-31, to authorize the construction of a bridge across the Pigeon river between the province of Ontario and the state of Minnesota.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Sevigny in the chair.
On clause 1-Short title.
Mr. Badanai:: The Pigeon river is the boundary line between the United States and the province of Ontario. Has an interdepartmental committee gone thoroughly into the question of the size of the bridge to be built and has the location been selected?


Donald Methuen Fleming: Mr. Chairman, as the hon. member realizes, the purpose of this bill is to provide for broader purposes than the previous bill. This one is intended to provide for the construction, operation and maintenance of a bridge over the Pigeon river to connect highways in the province of Ontario and the state of Minnesota. The bill is introduced at the request of the province

of Ontario and it authorizes the province to enter into an agreement with the state of Minnesota for this purpose. It is our information that appropriate legislation already exists in the United States.


[Stage Direction]
Clause agreed to.
Clauses 2 to 6 inclusive agreed to.
Title agreed to.
Bill reported, read the third time and passed.

Gordon Minto Churchill: the second reading of and concurrence in amendments made by the Senate to Bill C-49, to provide for the establishment of a national energy board.


George James McIlraith: Mr. Speaker, I want to take advantage of the opportunity to ask the minister a question at this point. He will recall that I was critical of the government. I argued that they were responsible for some delay with respect to this matter and I concluded by expressing the hope that the board would be appointed very quickly after the bill passed. I have two questions I should like to ask him now. First, is it the intention to proceed with the appointment of the board as soon as authority is finally granted by parliament? Second, can he give the house any further information as to when we may expect the second report from the Borden commission?


Gordon Minto Churchill: In answer to the first question, the intention is to proceed as rapidly as possible with the appointment of the energy board. With regard to the second question, it is expected that the second report will be presented soon. I cannot give the exact date.


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


Gordon Minto Churchill: the second reading of Bill S-32, to repeal certain fisheries laws in force in the province of Newfoundland respecting the exportation of salt fish.
He said: Mr. Speaker, may I say just a word in explanation. The explanatory note in the bill is sufficient, I think, but in order that there shall be no doubt about it may I say that a year ago I gave 12 months notice

that the exclusive licence to export fish would be discontinued in so far as it affected Newfoundland Associated Fish Exporters Limited. Consequent upon that, it is necessary to repeal the act which required permits for the export of fish. The exclusive right to export fish ends on July 31 of this year. It would be necessary then, and this is in accord with the wishes of the Newfoundland Associated Fish Exporters Limited, that the permit system be discontinued. Hence, this legislation which has been introduced.


John Whitney Pickersgill: I do not intend to inflict a speech on the house at this hour of the night, but I do want to say that it seems to me very regrettable indeed that when this announcement was made over a year ago this legislation, which was obviously necessary, could not have been introduced at sometime during the session when it would have been possible to discuss this very important subject. I should like to remind you, sir, and remind the house, that the exportable surplus of salt codfish and codfish generally, in relation to the total production of this country is probably higher than that of any other commodity in the country and very much higher than wheat, as I discovered over 20 years ago when I first came to Ottawa from western Canada and had the view that perhaps many people in western Canada have that this industry is not as important as one finds it is.
For many years the marketing of the fish from Newfoundland was carried on by a lot of individual firms and there was cutthroat competition in the markets, a deplorable state in the markets. In order to overcome this, this system which has many analogies though also many differences with the wheat board system in western Canada grew up. Obviously, when Newfoundland became a part of Canada it was impossible to have a controlled marketing situation indefinitely in one province and an uncontrolled situation in the other provinces producing the same commodity. I have no criticism to make of the decision of the government to end NAFEL's exclusive licence. I think it was inevitable. It was just a question of timing, and I am not even criticizing the timing.
I do not intend to spend more than a minute or two on a point upon which I could have taken a great deal of time under other circumstances, perhaps on the minister's estimates. It does seem to me that a return to cutthroat competition by Canadian producers is going to be suicidal to the industry. We have competition from the Norwegians, the French, the Icelanders and from many other producers of fish in the foreign markets, and all our competitors are subsidized. The Canadian producer has to face subsidized
R.C.M.P. Act
exports from all these countries, and to face them without anything comparable. I wish I knew the answer to this problem, and I would be glad to put it forward, but I am quite convinced that some method has to be found, by some device or other, so that the Canadian producers will not be competing with one another in the markets for any considerable length of time.
I hope the minister and his officials, and the Minister of Fisheries who is so familiar with this problem and his officials, will use their utmost energy in tackling this problem. I know there have been conferences with the producers in some other provinces, and also with the exporters. I know some of the difficulties. I know this is not an easy problem to solve at all, but a decent livelihood for these primary producers depends upon its solution. It should be tackled, and tackled with the utmost vigour and the utmost dispatch, and should be solved so that we will not have any lengthy period of real depression in the industry before there is a solution.


[Stage Direction]
Motion agreed to, bill read the second time, considered in committee, reported, read the third time and passed.


Edmund Davie Fulton: the second reading of and concurrence in amendments made by the Senate to Bill No. C-34, respecting the Royal Canadian Mounted Police.


John Whitney Pickersgill: I should like to ask the minister if, as I believe it is, this is the amendment he said he would undertake to have made in the other place at my suggestion when we debated this matter?


Edmund Davie Fulton: That is correct. The Senate -I do not like to say at the request of the government, but the matter was discussed with members of the other place-in accordance with the undertaking I gave here the Senate amended the bill to provide that immediately after subclause (2) of clause 20, there should be inserted the following subclause 3:
The minister shall lay before parliament a copy of every arrangement made under subsection (1) within 15 days after it is made or, if parliament is not then sitting, on any of the first 15 days next thereafter that parliament is sitting.
The arrangements referred to are any new contracts with a province for the R.C.M.P. to carry out policing within the province.

Box Car Distribution


John Whitney Pickersgill: The minister satisfied himself in that case there was no present obligation to table these under the Regulations Act.


Edmund Davie Fulton: That is correct, yes.


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


Edmund Davie Fulton: the second reading of and concurrence in amendments made by the Senate to Bill No. C-58, to amend the Criminal Code.


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

Mr. Speaker:: I understand the Minister of Trade and Commerce is requesting leave to revert to motions. Is it the pleasure of the house to give such leave?


Some hon. Members:: Agreed.


Gordon Minto Churchill: I have an important announcement to make with regard to railway box car distribution. The government has given careful consideration to the report of the inquiry into the distribution of railway box cars as submitted by Mr. John Bracken and also to the representations relating to this report submitted to the government by the wheat pools, the United Grain Growers Limited and the Northwest line elevators association.
The Canadian wheat board, in allocating box cars to elevator companies, has been operating under an instruction issued to it by my predecessor in office, Right Hon. C. D. Howe, dated July 13, 1954. This instruction was of a very general nature and its administration depended in a large measure on the judgment of the Canadian wheat board. Under this directive the allocation of box cars was based primarily on the proportion of business each company enjoyed prior to congestion developing.
In its administration of delivery quota policy in times of congestion of country and terminal elevators the wheat board has over the years taken the position that available elevator space should be used to the greatest possible extent and that railway cars, as far as possible, should be placed at delivery points which are congested and lagging in respect to delivery quotas, rather than at delivery points where space is available.

I now wish to comment on the main recommendations as submitted to the government by Mr. Bracken. It is noted that Mr. Bracken's recommendations are framed to allow farmers the fullest possible exercise of their right to deliver to the elevator of their choice in times of congestion. While emphasizing the importance of freedom of choice in selection of elevators by farmers, Mr. Bracken states clearly in his recommendation No. 4 as follows:
It is recommended that no procedure be allowed to impair the wheat board's sales efficiency or to get in the way of bringing forward the kinds and grades of grain most needed to meet market requirements from time to time.
Mr. Bracken indicated the overriding necessity of the board to give primary consideration to the movement of the kinds of grain and the grades of grain required to meet market demand. Whatever else happens, every opportunity should be taken to get grain into export and domestic markets. This has been the policy of the wheat board over the years, and must continue to be the primary responsibility of the board.
The general approach of the inquiry to the problem which it had in hand is indicated by Mr. Bracken's recommendation No. 1, which reads as follows:
It is recommended that the present box car distribution procedure give way to a more fully competitive elevator operation-both at local points and as between companies-as far as this is practical under present conditions.
I am sure that producers and elevator companies alike share the view that there should be maximum competition in the handling of producers' grain. This recommendation is qualified by the words "as far as this is practical under present conditions". No doubt Mr. Bracken appreciated the requirements of the wheat board as a merchandising organization, the need for some attention to equality in delivery opportunity and the need to utilize as fully as possible available storage space during times of elevator congestion. These are very practical and reasonable qualifications.
Mr. Bracken's recommendation No. 5 is most important, dealing as it does with the concept of a more competitive elevator operation. This recommendation reads as follows:
It is recommended that, whatever the future policy of banning shipments may be, at points which have one or more full elevators, while others have space available for new business, the practice of embargoing shipments from full elevators at such points be discontinued.
In this recommendation lies the crux of the report of the inquiry. Here Mr. Bracken breaks new ground and departs from the established policy of the board. He is of the opinion that a congested elevator is entitled

to relief except, perhaps, toward the end of a crop year when the board is endeavouring to equalize delivery quotas. He considers that over the greater part of a crop year cars should be supplied to congested elevators in order that they may continue as competitive factors on the local market.
This point has been discussed with the wheat board, and the board believes that it is possible to modify its present procedures by giving relief to elevators which are congested, except toward the end of the crop year when an endeavour is being made to equalize delivery quotas. The general approach will be to provide out-of-order cars to elevators which are congested and are unable to receive grain from producers. As recommended by Mr. Bracken such out-of-order cars will be chargeable to a company's subsequent allocation.
Mr. Bracken's recommendation No. 8 (ii) (a) states:
That the allocation of shipping orders to different elevator companies be on the basis of current business earned by each.
This is a principle that is basically sound and in keeping with the policy of a more competitive elevator system. Mr. Bracken's recommendation No. 8 (ii) (c) is also important. It reads as follows:
That each elevator at a shipping point be kept in a position to compete fairly with the others by the receipt of sufficient shipping orders from its parent company, and sufficient cars from the railway, to keep it from being "plugged" and thus out of business when others are not.
The wheat board will continue to allocate shipping orders to the head offices of elevator companies which in turn will distribute these shipping orders to their local elevators. This recommendation represents a continuation of the present practice of the wheat board and is in line with the objective of maintaining a more highly competitive elevator business.
These are the main operating recommendations of the inquiry. Other recommendations deal primarily with matters of procedure in relation to the important recommendations which I have already commented upon.
Under conditions of grain surplus, all grain storage capacity in Canada is required if producers are going to continue to market in each crop year a volume of grain in excess of 500 million bushels. Our total storage capacity in Canada is estimated at 636 million bushels, with an actual working capacity of some 550 million bushels. Of this total elevator capacity, approximately 60 per cent is country elevator capacity. To a greater extent than ever before country elevator storage capacity has been used not only for the receiving and shipping of grain but for
Box Car Distribution
the storage of grain. Therefore, whatever changes are made at this time, full use will have to be made of our country elevator capacity as well as our terminal capacity, if producers are to continue to deliver as large a volume of grain as they have marketed in recent years.
We are endeavouring to continue the effective use of our elevator storage capacity, and at the same time, to create conditions of more equity for producers in the delivery of their grain, and more competition in the handling of their grain.
The new instructions to the Canadian wheat board will result in a gradual rather than sudden change in the relationship between the board and the elevator companies in so far as shipping orders are concerned. The objective will be to place individual elevator companies in the position where they can earn larger handlings of producers' grain.
I should now like to read the new instruction which will become effective on August 1, 1959. It is dated Ottawa, July 18, 1959. It is addressed to Mr. W. C. McNamara, chief commissioner, the Canadian wheat board, Winnipeg, Manitoba and it reads as follows:
Dear Mr. McNamara:
The government has given careful consideration to the report of the inquiry into the distribution of railway box cars. In view of the findings of the inquiry, the instruction given to your board under date of July 13, 1954, is cancelled.
It is now the desire of the government that on and after August 1, 1959, your board should be guided by the following principles emphasized in the report of the inquiry. These principles are:
(1)	Primary consideration must be given to the movement of the kinds of grain and the grades of grain required to meet sales commitments and to facilitate your selling operations.
(2)	Subject to (1) above and as far as current circumstances and reasonable equality in delivery opportunity permits, it should be your objective to provide:
(a)	that producers should have the opportunity of delivering their grain to the elevator or elevators which they wish to patronize; and
(b)	that elevator companies which act as your agents should have reasonable opportunity of competing with one another in the handling of producers' grain.
In implementing the principles outlined above it is the view of the government that you should, as far as practicable, give attention to:
(1)	The need of a congested elevator for shipping orders.
(2)	Current grain receipts of each elevator company as a factor in determining the division of board shipping orders.
In carrying out this instruction it is the responsibility of your board to advise each elevator company from time to time of its share of shipping orders.
In conveying this new instruction to you, I realize that you are dealing with a very complex situation, with overriding factors involved. Therefore, following the completion of the crop year 1959-60, I would like to review this instruction with you in the light of your administrative experience.

Box Car Distribution
That letter is signed by myself. I expect that the Canadian wheat board will issue detailed instructions to the trade within the next few days in light of the broad principles outlined in the directive which I have just read.
In closing, Mr. Speaker, I express my appreciation to Mr. Bracken and his colleagues who assisted in this inquiry. They have made a thorough investigation of this important aspect of grain marketing. Their report is the first authoritative study of box car distribution problems in western Canada and will serve as a useful guide in these matters for many years.


Lester Bowles Pearson: Mr. Speaker, I think this is the first occasion on which I have ever had to speak on box cars. The circumstances are somewhat surprising in that we are in the last minutes of the last day of the session. I realize that the minister's statement deals with a matter of concern among producers in western Canada, and I hope the information he has been good enough to give us will help to remove some of that concern.


Herbert Wilfred Herridge: Mr. Speaker, this is the second occasion on which I have had the opportunity of speaking on box cars, but because I am a bit foggy as to the implications of the minister's statement, can he tell me if the statement he has just read will correct the situation which I raised on orders of the day this morning on behalf of several wheat pool committees in Saskatchewan which had complained of certain deficiencies with respect to the distribution of box cars?


John Whitney Pickersgill: I wonder if the minister is now in a position to answer the question I asked him about box cars some time ago which he did not answer at that time?


Mr. Speaker:: The hon. member for Kootenay West (Mr. Herridge) asked a question in the course of his statement which, with the leave of the house, might be answered. Perhaps he would ask it again.


Herbert Wilfred Herridge: Mr. Speaker, I was asking the minister this. I am a bit foggy as to the full implications of his statement because I am not very well acquainted with the distribution of box cars. Would the minister inform the house if his statement corrects the situation that I complained of this morning on orders of the day on behalf of the various wheat pool committees in Saskatchewan?


Gordon Minto Churchill: Mr. Speaker, it will have that effect.


Mr. Speaker:: Perhaps by unanimous consent this sitting might be suspended until the messenger arrives from the other place, to be signified by the ringing of the bell.


Lionel Chevrier: Mr. Speaker, while we are waiting for the messenger to arrive, perhaps you will allow me to follow the usual custom which has been pursued in this house now for some years. It is for the opposition to extend to those who are responsible for the business of the house their thanks and gratitude for the manner in which that business has been conducted during the session. On behalf of the opposition I would like to express to you, Mr. Speaker, our thanks for the manner in which you have accepted our points of view. While we have not always agreed with the decisions which you have handed down, and while sometimes we may have felt on this side of the house that they were not in accordance with our liking, none the less I would I think be remiss in my duty were I not to say to you that since you represent constituted authority in this house we always have respected your judgments and your decisions, and I am sure that such will be the case in the future.
I think, sir, too, that I would like to express to the house leader my thanks for the very co-operative manner in which he and I have gotten along during the course of this session. I can say in all sincerity that because the house leader, who is now the Secretary of State for External Affairs (Mr. Green), will be going on to higher duties and functions, I take it he will not be in a position to carry on in that capacity at the next session, but I would want him to know that I personally have appreciated a great deal working with him during the course of the session. I would also like to express my hope that the Prime Minister will find it possible to appoint in his stead someone with whom I and those of us who sit on this side of the house will be able to co-operate in order to expedite the business of the house.
I think I would also wish to express a word of thanks to the Minister of Trade and Commerce, the acting house leader, for the manner in which he has conducted the proceedings in the last few days in the absence of the Secretary of State for External Affairs. I think there is one thing which these last few days have indicated and it is that when we in the House of Commons, no matter where we sit, determine and decide that we are going to do a thing in accordance with agreement, then we can do it, and it is all to the credit of those of us who sit on both sides of the house that the agreement

which was arrived at was carried out and that the business was done with care, efficiency and expedition.
(Translation):
May I also offer a word of thanks, Mr. Speaker, to the Deputy Speaker of the house for whom I have much admiration, I have perhaps more for the manner in which he presides over the deliberations of this house, because he does so with efficiency and with patience.
(Text):
There was one omission, sir, which I made at the last session of parliament which I would not want to make again, and it is that I omitted involuntarily to say a word of thanks to the chairman of committees. I am sure he will take no offence at that omission, and I want to repair it at once. I want to tell him that while I may have had some hesitation at some of the decisions which he has rendered in an earlier session, I have nothing but commendation for him on this occasion, more particularly because of the manner in which he has presided over the deliberations of the committee during the session. He has proven to this house that he understands the rules and that he intends to put them into effect and into practice fairly and equitably.
Finally, sir, I think those who sit with me on this side of the house would wish me to extend in an especial manner our thanks to the house staff, who in these last few days have been hard put, because of the long hours during which we have had to sit in order to fulfil their duties. They have done them well, and to the Hansard reporters and to those who are responsible for the publication of Hansard, which during the sittings has always been on time in the morning, I express our thanks and our gratitude. From all of those who sit in the House of Commons our very best and good wishes for a happy and pleasant recess.


Herbert Wilfred Herridge: Mr. Speaker, with respect to the remarks made by the hon. member for Laurier concerning yourself, the chairman of the committee, the house leader and the staff, I want to say a round amen. Also I trust the period of the recess will be spent by all hon. members of this house to the general advantage of the people of Canada.


John George Diefenbaker: Mr. Speaker, I wish to join in this festival of brotherly love to thank the hon. member for Laurier for the delicate manner
Felicitations
in which he expressed the appreciation of all of us for those he named and to tell him how much I appreciate the thoughts he expressed in reference to the Secretary of State for External Affairs (Mr. Green) who is about to vacate his position as house leader and also to say that the example set by the Minister of Trade and Commerce (Mr. Churchill) in the last few days is indicative of the fact that there are others who can hold that position in a way that will be acceptable to the entire house.
To the hon. member for Laurier and the hon. member for Kootenay West (Mr. Herridge) I wish to express appreciation for the manner in which they brought about that spirit of co-operation which assures to the greatest degree possible the achievement of the responsibility that each of us has in his respective place in the house.
To you, sir, the custodian of the conscience of parliament, and to the Deputy Speaker and the chairman of the committees, I extend appreciation and thanks from all of us for the manner in which you have discharged your responsibilities, difficult though they are, to the complete satisfaction of the members of this house.


Lester Bowles Pearson: Mr. Speaker, perhaps I am out of order in rising at this time because two have already spoken from this side but may I in a word, as leader of the official opposition convey my best wishes and warm regards to the Prime Minister (Mr. Diefenbaker), his colleagues and hon. members of the house, I express the hope that they will have a happy recess and come back to the next session energetic and even wiser.


Mr. Speaker:: It is usually the privilege of the Speaker to have the last word. I thought I had made my one and only speech of the session this afternoon when I had the pleasure of piloting through the committee the legislation estimates, but I am now inclined to comment on the irregular but very pleasant references that have been made to the conduct of the Speaker.
I am deeply grateful to all hon. members who have spoken so generously and I am also deeply grateful to all hon. members of the house for the co-operation they have accorded to me and the other officers of the house.
When my decisions were right, I perhaps expected acceptance of them, but it is a higher compliment to have received such general acceptance when they were wrong. I extend to all hon. members my good wishes for a happy recess.

The Royal Assent


Mr. Deputy Speaker:: Mr. Speaker, permit me first of all to tell you how much I appreciated working with you during the session which is now coming to a close. May I express my sincere thanks for your wise counsel and understanding with respect to so many situations. May I also tell Mr. Raymond, Mr. Montgomery and Mr. Dubroy how much I valued their assistance in this house. If at times the various decisions which I made were right it was mostly because of their wise counsel, and if at times my decisions were wrong it was because they were not present to advise me.
I also wish to express my thanks to the members of the staff and my special thanks to the hon. members of the house who bore with me while I made what at times must have sounded like very boring statements.
(Translation):
Mr. Speaker, allow me to express my fullest gratitude both to you and to all the members of the house, as well as to the Clerk and his deputies who have always given me the benefit of their advice.
Let me also thank my colleagues in the house for their understanding which has so much helped me in solving the problems incumbent upon me. I fully appreciate the extent to which this understanding has assisted me in making rulings in committee.
I am especially grateful to the hon. member for Laurier (Mr. Chevrier) for his kind remarks about me.
May the period between now and the next session enrich you in wisdom and happiness.
(Text):
Goodbye to all, and I hope we meet again soon.


Charles Edward Rea: Mr. Speaker, may I say first of all that I am very happy even to be alive at the conclusion of this session. I do wish to thank hon. members for their kind co-operation and their charitable words which are very much appreciated. I wish to add my thanks to those of Mr. Deputy Speaker for the assistance extended to us by the clerk and officials of the house. I want now to say one last word to all: do have a happy, happy summer holiday.



THE ROYAL ASSENT

Mr. Speaker:: I have the honour to inform the house that I have received the following communication:
Ottawa, July 18, 1959
Sir:
I have the honour to inform you that the Honourable Patrick Kerwin, Chief Justice of Canada, acting as Deputy of His Excellency the Governor General, will proceed to the Senate

chamber today, the 18th July, at 11.45 p.m. for the purpose of proroguing the present session of the parliament of Canada.
I have the honour to be, sir,
Your obedient servant,
J. F. Delaute
Secretary to the Governor General (Administrative)
A message was delivered by Major C. R. Lamoureux, Gentleman Usher of the Black Rod, as follows:
Mr. Speaker, the Honourable the Deputy Governor General desires the immediate attendance of this honourable house in the chamber of the honourable the Senate.
Accordingly, Mr. Speaker with the house went up to the Senate chamber.
In the Senate chamber, the Deputy Governor General was pleased to give, in Her Majesty's name, the royal assent to the following bills:
An act to incorporate Standard Trust Company.
An act to incorporate Desjardins Mutual Life Assurance Company.
An act to amend the Public Lands Grants Act.
An act to confirm an agreement between the government of Canada and the government of the province of New Brunswick respecting Indian reserves.
An act to confirm an agreement between the government of Canada and the government of the province of Nova Scotia respecting Indian reserves.
An act to provide for contributions and loans to the provinces in respect of crop insurance.
An act to provide for the extension of long term mortgage credit to farmers.
An act to amend the Maritime Coal Production Assistance Act and to authorize certain amendments to the agreement made under that act with Dominion Coal Company, Limited.
An act to provide for the humane slaughter of food animals.
An act to provide for the payment of additional grants to the province of Newfoundland.
An act respecting the Royal Canadian Mounted Police.
An act to amend the Income Tax Act.
An act to provide for the establishment of a national energy board.
An act to amend the Criminal Code.
An act to authorize the construction of a bridge across the Niagara river between the province of Ontario and the state of New York.
An act to authorize the construction of a bridge across the Pigeon river between the province of Ontario and the state of Minnesota.
An act to repeal certain fisheries laws in force in the province of Newfoundland respecting the exportation of salt fish.
An act to amend the Combines Investigation Act and the Criminal Code.
To these bills the royal assent was pronounced by the Clerk of the Senate in the following words:
In Her Majesty's name, the Honourable the Deputy Governor General doth assent to these bills.

Then the Speaker of the House of Commons addressed the Deputy Governor General as follows:
May It please Your Honour:
The Commons of Canada have voted supplies required to enable the government to defray certain expenses of the public service.
In the name of the Commons I present to Your Honour the following bill:
An act for granting to Her Majesty certain sums of money for the public service of the financial year ending the 31st March, 1960.
To which bill I humbly request Your Honour's assent.
To this bill the Clerk of the Senate, by command of the Deputy Governor General, did thereupon say:
In Her Majesty's name, the Honourable the Deputy Governor General thanks her loyal subjects, accepts their benevolence, and assents to this bill.



PROROGATION OF PARLIAMENT

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After which the Deputy Governor General was pleased to close the second session of the twenty-fourth parliament of Canada with the following speech:
Honourable members of the Senate:
Members of the House of Commons:
Canadians have welcomed with profound gratitude the visit of Her Gracious Majesty the Queen and His Royal Highness the Prince Philip. Her Majesty and the prince are assured of the affection and devotion of the Canadian people and of their deep attachment to the Crown. To mark Her Majesty's visit you have established the Queen Elizabeth II research fund for research into the diseases of children.
It has been gratifying that the President of the United States was able to be present with our Queen on the occasion of the official opening of the St. Lawrence seaway.
Canadians are convinced that every effort must be made to attain and to preserve lasting peace in the world. My government is hopeful that it will be possible at summit meetings of heads of governments to make progress toward the settlement of such important issues as Germany, Berlin, nuclear test explosions and toward agreement on general disarmament.
Meanwhile, it is necessary to maintain the strength of the free world provided by the north Atlantic alliance. To this end an important decision has been reached to re-equip the Canadian air division in Europe with modern and up to date aircraft. You have been informed of the steps being taken for sharing with the United States the production and procurement of defence equipment and have approved an appropriation to support selected development programs related to production sharing.
The government recognizes that the peace of the world cannot be assured by defence measures alone and that economic assistance to less developed countries is a necessity and in Canada's interest. You have authorized an increase in Canada's contribution under the Colombo plan to provide further help for Asian and African nations, particularly those within the commonwealth. You have also voted substantial assistance for the new federation of the West Indies. You have approved a measure to increase Canada's subscriptions to the international bank and the international monetary fund.
Prorogation of Parliament It is encouraging to note the strong recovery from the recent recession both abroad and here at home. My government will continue to take whatever steps lie within its power to maintain employment and to sustain sound economic growth.
To improve the lot of those who unfortunately from time to time find themselves unemployed, you have made important amendments to the Unemployment Insurance Act.
Emphasis has continued to be placed on national development and financial provision has been made for numerous projects in this field.
Important measures have been approved for the agricultural sector of our economy. You have enacted legislation to provide for loans and grants for provincial crop insurance schemes and a statute has been passed under which long term mortgage credit can be made available to farmers. The new farm credit act provides for substantially larger loans than have hitherto been available.
A national energy board has been established. This important new agency will ensure that, so far as it is within the power of parliament, Canada's energy resources will be conserved and used in the best interests of all our people.
The Maritime Coal Production Assistance Act has been amended to enable a further measure of assistance to this industry on which the livelihood of so many Canadians depend.
You have amended the Export Credits Insurance Act and thus provided a further stimulus for our exports and our trade generally.
Several statutes which go to make up the veterans charter have been amended, broadening the range of benefits to veterans, particularly those who settle on the land.
The Federal-Provincial Tax Sharing Arrangements Act has been amended to extend the increase made last year in the provincial share of personal income tax revenue.
A conference of dominion and provincial ministers of finance and provincial treasurers was held early this month at which it was agreed that a comprehensive study should be undertaken of the problems of intergovernmental financial and economic relations. A further meeting will be held next October. Meanwhile, reports on many of these questions are being prepared by the federal-provincial continuing committee of officials.
You have enacted a measure to authorize the payment of additional annual grants to Newfoundland in accordance with the scale contained in the report of the royal commission on Newfoundland finances appointed in fulfilment of the obligation of the government of Canada under the terms of union of Newfoundland with Canada.
Y ou have enacted a measure to alleviate the discriminatory effects of the last horizontal increase in freight rates and an inquiry has been instituted into a broad range of railway problems.
Changes have been made in the Criminal Code, including an important provision respecting obscene literature.
After study of the subject by a committee, you have approved a measure for the humane slaughter of food animals.
You have signified your approval of a new international wheat agreement negotiated within the past few months. The agreement has since been accepted.
You have provided for the appointment of parliamentary secretaries to ministers of the crown.
The supplementary pensions for retired civil servants, members of the armed services and of the Royal Canadian Mounted Police, provided by appropriations last year, have been placed on a statutory basis.
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Prorogation of Parliament
Other measures enacted at this session include the act to approve the income tax convention with Finland, the C.N.R. Financing and Guarantee Act, a new Seeds Act, acts to confirm agreements with the provinces of Nova Scotia and New Brunswick respecting Indian reserves, an act to authorize the construction of a bridge across the Niagara river between Ontario and New York, an act to authorize the construction of a bridge across the Pigeon river between Ontario and Minnesota, and an act to repeal certain fisheries laws of Newfoundland respecting the exportation of salt fish.
You have also amended the St. Lawrence Seaway Authority Act, the Northwest Territories Act, the Farm Improvement Loan Act, the National Defence Act, the National Housing Act, the Trans-Canada Highway Act, the Old Age Security Act, the Fisheries Improvement Loans Act, the Public Servants Inventions Act, the Income Tax Act, the Customs Tariff, the Excise Act, the Excise Tax Act, the
New Zealand Trade Agreement Act 1932, the Prime Minister's Residence Act, the Judges Act, the Prisons and Reformatories Act, the Length and Mass Units Act, the Weights and Measures Act, the Royal Canadian Mounted Police Act, the Royal Canadian Mounted Police Superannuation Act, the Public Lands Grants Act, and the Combines Investigation Act.
Members of the House of Commons:
I thank you for the provision you have made for the public services in the current fiscal year.
Honourable members of the Senate:
Members of the House of Commons:
I pray that divine Providence may continue to bless, protect and guide our nation.
This concluded the second session of the twenty-fourth parliament.

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

Mr. Rouleau: 1.	What was the amount lost by the French network of the Canadian Broadcasting Corporation in sponsored programs or otherwise, since December 29, 1958?
2.	How many films have been purchased by the French network of the Canadian Broadcasting Corporation for presentation on television, since December 29, 1958?
3.	From whom were such films purchased and for what amount in each case?
4.	Who was entrusted with the protection of the employees who continued to work for the French
Question
network of the Canadian Broadcasting Corporation at Montreal?
5.	What was the cost thereof?
Answer by: Hon. George C. Nowlan (Minister
of National Revenue):
The Canadian Broadcasting Corporation advises as follows:
1. It is difficult to compute the amount lost, if any, to the French network in commercial revenue as this must be balanced against the saving in cancellation of live programs as well as in salaries and other factors during the period of the strike.
2 and 3. See answer to question No. 68, page 1581, House of Commons Debates, March 3, 1959.
4 and 5. See answer to question No. 65, page 4053, House of Commons Debates, May 26, 1959.

Supply-Items Passed
[The following items were passed in committee of supply J:



DEPARTMENT OF NATIONAL REVENUE

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Customs and excise divisions-
254.	General administration, $4,317,418.
255.	Inspection, investigation and audit services, $4,211,855.
Ports-
256.	Operation and maintenance, $29,740,118.
257.	Construction or acquisition of buildings, works, land and equipment, $935,500.
Taxation division-
258.	General administration, $3,415,300.
259.	District offices, $29,792,055.
Tax appeal board-
260.	Administration expenses, $110,700.

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Taxation division-
550. General administration-to ratify payments totalling $24,171.52 made as salary to M. W. McA'Nulty in respect of the period from the 17th day of February, 1957, when he automatically ceased to be employed in the public service having attained 65 years of age, to the 17th day of May, 1959, when he ceased to render services to Her Majesty as if he had been employed; and he shall be deemed, for the purposes of the Public Service Superannuation Act, to have been employed in the public service during that period, $1.

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42.	Salaries and expenses of the board, $200,000. Canadian Broadcasting Corporation-
43.	Grant in respect of the net operating requirements, of the radio and television services, $58,404,000.
44.	Grant for the capital requirements, including the replacement of existing capital assets, of the radio and television services, $9,197,000.
International shortwave broadcasting service-
45.	Maintenance and operation including authority to credit to this appropriation revenue from the rental of facilties in the Radio-Canada building and at Sackville, N.B., to an amount of $331,500 and to re-expend these moneys for the purposes of the international service, $1,983,225.
46.	Construction or acquisition of buildings, works, land and equipment, including supervision, $57,750.

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The Speaker of the Senate-
174.	Allowance in lieu of residence, $3,000.
175.	General administration, $722,090.

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House of Commons-
The Speaker of the House of Commons-
176.	Allowance in lieu of residence, $3,000.
Deputy Speaker in the House of Commons-
177.	Allowance in lieu of apartments, $1,500.
178.	Allowance to the deputy chairman of committees, $2,000.
179.	Expenses of the Canada-United States joint parliamentary committee, and the expenses of delegates to the interparliamentary union, $5,000.
180.	Subscriptions to publications of the commonwealth parliamentary association to be distributed to members of the House of Commons,
and to provide for the Canadian share of expenses of the commonwealth parliamentary association, $10,000.
181.	Grant to the Canadian North Atlantic Treaty Organization parliamentary association, $14,000.
182.	General administration - estimates of the clerk, $1,889,060.
183.	Estimates of the sergeant-at-arms, $867,829.
184.	Pension to the unmarried sister of the late Colonel Harry Baker M.P., $700.
Library of Parliament-
185.	General administration, $353,845.

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The Senate-
533.	To authorize, notwithstanding anything contained in the Senate and House of Commons Act, payment to each member of the Senate who attended the first part of the second session of the twenty-fourth parliament which commenced on January 15, 1959, and ended on March 25, 1959, of an amount representing the transportation and living expenses of such member while on the journey between Ottawa and his place of residence after the Easter adjournment of parliament on March 25, 1959, and on the return journey from his place of residence to Ottawa at the end of the recess which commenced on that date, or at any other one time during the session, $6,500.
House of Commons-
534.	Expenses of the Canada-United States joint parliamentary committee, and the expenses of an observer to the inter-parliamentary union-further amount required, $2,500.
535.	Subscriptions to publications of the commonwealth parliamentary association to be distributed to members of the House of Commons, and the Canadian share of expenses of the commonwealth parliamentary association-further amount required, $1,000.
536.	To authorize, notwithstanding anything contained in the Senate and House of Commons Act, payment to each member of the House of Commons who attended the first part of the second session of the twenty-fourth parliament which commenced on January 15, 1959, and ended on March 25, 1959, of an amount representing the transportation and living expenses of such member while on the journey between Ottawa and his place of residence after the Easter adjournment of parliament on March 25, 1959, and on the return journey from his place of residence to Ottawa at the end of the recess which commenced on that date, or at any other one time during the session, $21,000.

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A-Department-
238.	Departmental administration, $1,601,785. National health branch-
Health services, including assistance to the provinces-
239.	Administration, $364,459.
240.	Consultant and advisory services, $748,415.
241.	Laboratory and advisory services, $1,917,266.
242.	To authorize general health grants to the provinces, the Northwest Territories and the Yukon Territory upon the terms and in the amounts detailed in the estimates and under terms and conditions approved by the governor in council including authority, notwithstanding section 30 of the Financial Administration Act, to make commitments for the current year not to exceed a total amount of $62,969,175, $46,000,000.

Indian and northern health services-
243.	Operation and maintenance, including grants to hospitals and other institutions which care for Indians and Eskimos, $20,729,052.
244.	Construction or acquisition of buildings, works, land and equipment, $3,100,500.
245.	Medical advisory, diagnostic, and treatment services, $4,699,622.
246.	Administration of the Food and Drugs and the Proprietary or Patent Medicine Acts, $1,901,138.
247.	Administration of the Opium and Narcotic Drugs Act, $226,469.
Welfare branch-
Family allowances and old age security-
248.	Administration, $3,112,657.
Old age assistance, blind persons and disabled persons allowances-
249.	Administration, $114,915.
General-
250. Grants to health and welfare and related organizations, as detailed in the estimates, $247,250.
General-
548. Grants to health and welfare and related organizations, as detailed in the estimates-further amount required, $60,000.
B-Civil defence-
251.	Expenses of the civil defence program, $7,220,817.

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303. Preparatory work, not within the fields of particular departments, on emergency defence measures, $175,000.

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General administration-
106.	Departmental administration, $2,461,599.
107.	Comptroller of the treasury-central office and branch offices administration, $18,213,329.
Administration of various acts and costs of special functions-
108.	Superannuation and Retirement Acts administration, $685,425.
109.	The Bank Act-salaries and expenses of the inspector general of banks' office, $32,810.
110.	Administration of the Farm Improvement Loans Act, the Veterans' Business and Professional Loans Act, the Fisheries Improvement Loans Act and the Prairie Grain Producers' Interim Financing Act, $101,530.
Tariff board-
111.	Administration, $151,481.
Royal Canadian mint-
112.	Administration, operation and maintenance, $1,187,135.
113. Construction or acquisition of equipment $117,395.
114.	Payments to the government of each province, in respect of income tax collected from corporations whose main business is the distribution to or generation for distribution to the public of electrical energy, gas or steam, of amounts computed in accordance with section 6 of The Tax Rental Agreements Act, 1952, as if the last two lines of subsection (1) of that section read as follows: " . . . ending on the thirty-first day of December, one thousand nine hundred and fifty-seven'' $9,000,000.
Supply-Items Passed Payments to municipalities-
115.	Grants to municipalities in accordance with the Municipal Grants Act and Regulations made thereunder, $22,500,000.
Contingencies and miscellaneous-
116.	Miscellaneous minor or unforeseen expenses, subject to the approval of the treasury board, including authority to re-use any sums repaid to this appropriation from other appropriations, and for special compensation or other rewards for inventions or practical suggestions for improvements, $1,500,000.
117.	Telephone service at Ottawa for all departments, $1,326,200.
118.	Losses incurred on foreign exchange tendered in payment of accounts receivable, $500.
General items of payroll costs including superannuation payments-
119.	Government's contributions to pension plans for employees engaged locally outside Canada, $100,000.
120.	To supplement other votes, subject to the approval of the treasury board, for the payment of salaries, wages and other paylist charges, $1,500,000.
121.	Government's contribution, as an employer, to the unemployment insurance fund in respect of government employees paid through the centred pay office, $900,000.
122.	Government's contribution to the hospital insurance plan for certain persons while they are abroad and after their return to Canada, as authorized by vote 668 of the Appropriation Act No. 5, 1958, $55,000.
123.	To authorize the payment of increases in allowances, pensions and annuities, in accordance with the pension increase regulations, 1958, made by the governor in council pursuant to vote 667 of the Appropriation Act No. 5, 1958: but the amounts of the increases shall be deemed not to be payments made pursuant to any of the acts or plan mentioned therein, $3,100,000.
University grants-
124.	Payments to the national conference of Canadian universities (hereinafter called the "conference") , in accordance with the agreement entered into between the conference and the Minister of Finance on the 19th day of November, 1958, (hereinafter called the "original agreement") pursuant to Vote 541 of the Appropriation Act No. 1, 1957, and Vote 669 of the Appropriation Act No. 5, 1958; and when a new corporation comes into existence (incorporated for the purpose of receiving and disbursing such payments to institutions of higher learning) to authorize the payments to be made thereto, in lieu of to the conference, in accordance with an agreement to be entered into, with the approval of the governor in council, by the Minister of Finance with the conference and the new corporation, such agreement to provide, in addition to terms and conditions similar to the terms and conditions in the original agreement, including a provision that any amount payable to an institution of higher learning and not paid by the corporation in the relevant fiscal year may be retained by the corporation until such time as the institution to which the money is payable claims the payment from the corporation or parliament provides otherwise for the disposal thereof, for the transfer of amounts in the possession of the conference to the new corporation and for termination of the original agreement, $26,221,500.
Miscellaneous grants-
125.	Canadian association of consumers, $10,000.
126.	Institute of public administration of Canada

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Supply-Items Passed

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41. Salaries and expenses o£ office, and to ratify payments totalling $11,728.15, made as salary to F. C. Wynne, Auditor 2, in respect of the period from the 9th day of October, 1955, when he automatically ceased to he employed in the public service having attained seventy years of age, to the 14th of March, 1958, when he ceased to render services to Her Majesty, as if he had been employed, $875,010.
Insurance-
148. Departmental administration, $694,441. General administration-
511.	Comptroller of the treasury-central office and branch offices administration-further amount required, $155,000.
General items of payroll costs including superannuation payments-
512.	To supplement other votes, subject to the approval of the treasury board, for the payment of salaries, wages and other paylist charges-further amount required, $1,500,000.
513.	Government's share of medical-surgical insurance premiums, determined on such bases and paid in respect of such persons (and their dependents) who hold offices or positions or perform services the remuneration for which is payable out of the consolidated revenue fund or by an agent of Her Majesty or who are contributors as defined in the Public Service Superannuation Act or who are members of the Canadian forces or the Royal Canadian Mounted Police as the governor in council prescribes, $3,500,000.

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Administration branch
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489.	Economics division-to extend the purposes of vote 4 of the main estimates for 1959-60 to include the making of a grant in the amount of $400 to the Canadian agricultural economics society, $1.
Production and marketing branch-
490.	Agricultural Stabilization Act administration- further amount required, $250,000.
491.	Subsidies for cold storage warehouses under the Cold Storage Act in the amounts detailed in the estimates-further amount required, $193,010.
Dairy products division-
492.	Grants and other assistance in accordance with the Cheese and Cheese Factory Improvement Act-further amount required, $235,674.
Fruit and vegetable division including maple products and honey-
493.	Assistance in construction of potato warehouses under terms and conditions approved by the governor in council-further amount required, $125,900.
Health of animals division-
494.	Contributions to the provinces, in accordance with regulations of the governor in council, of amounts not exceeding one-half of the amounts
paid by the provinces to owners of animals that have died as a result of rabies since the first day of April, 1958, $125,000.
Livestock division-
495.	Operation and maintenance-further amount required, $64,800.
496.	Quality premiums on high grade hog carcasses and administration costs-further amount required, $936,000.
Plant products division-
497.	Freight assistance on western feed grains- further amount required, $1,000,000.
498.	Agricultural lime assistance

further amount required, $250,000.
499.	Contributions to the governments of the provinces of Manitoba and Saskatchewan, in accordance with terms and conditions prescribed by the governor in council, of one-half the amounts paid by the governments of those provinces for transporting haying equipment, fodder and livestock, to and within those provinces on and after July 1, 1958, $35,000.

[Stage Direction]
Citizenship-
500.	Citizenship registration branch - further amount required, $121,780.
National gallery of Canada-
547. Administration, operation and maintenance- further amount required for the completion of the permanent Canadian pavilion at the Venice international biennale of art, $10,000.
DEPARTMENT OF LABOUR A-Department-
General administration-
529.	Departmental administration, including the expenses of the international labour conferences- further amount required, $11,700.
530.	Annuities Act-to authorize the payment of interest, in the current and subsequent fiscal years, out of the government annuities account, at a rate determined from time to time by the governor in council, on moneys received on account of the purchase or the proposed purchase of an annuity under section 4 of the Government Annuities Act and which have been or are being refunded because they were not or are not so applied: the said interest to be compounded yearly and to be payable for the period commencing one month from the day on which the moneys were received by Her Majesty and ending on the day on which the refund was or is made, $1.
Special services-
531.	To extend to the 31st day of May, 1959, the period in respect of which payments may be made to a province on winter work projects in municipalities as contemplated by vote 709 of the Appropriation Act No. 1, 1959, $1.00
B-Unemployment Insurance Commission-
532.	Administration of the Unemployment Insurance Act-further amount required, $100,000.


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Thursday, June 25, 1959