1960-11-29

Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, with a view to regularizing the proceedings today I will simply say at this time that provided it is acceptable to the opposition, in order to make possible today a discussion of external affairs the Secretary of State for External Affairs will, when the orders of the day are called, follow the course that was taken on March 15, 1957. At that time the Leader of the Opposition (Mr. Pearson), then secretary of state for external affairs, moved the following motion:
That this house do now adjourn and that, in order to permit a debate on external affairs, standing order 32(2) shall be suspended in relation thereto.
In that way, following the course that was taken at that time, the house will be in a position to carry out the suggestion made last Friday and have a discussion of foreign affairs. I hope that course will meet with acceptance by all hon. members of the house. 1 simply mention at this time that that course will be followed.


Hon. Lionel Chevrier (Laurier):: Mr. Speaker, I think the circumstances under which the Leader of the Opposition, when he held the position of secretary of state for external affairs, made the motion to which the Prime Minister has referred were entirely different from those which exist at the present time. I feel it is my duty, sir, to bring those circumstances to the attention of the house. They were made after unanimous consent, not only by both parties but by all parties in the house.
Such was not the case here. The Prime Minister knows full well that when this announcement was made by the acting house leader the other day I asked under what authority it was made. He replied that it would be made by virtue of a motion to adjourn the house. I think, sir, I am entitled to put on the record here exactly what happened in connection with this matter on earlier occasions.


Mr. Speaker:: I suggest that the hon. member defer his comment on this matter until it comes before the house at the proper 90205-6-191
time. The Prime Minister's statement was just an announcement to the house by way of introduction. When we come to orders of the day, then it will be in order to deal with the matter.


John George Diefenbaker: While that is quite proper, I see no reason, if the house will agree, why the hon. gentleman should not proceed now if Your Honour would permit, because we are entirely at the disposal of the house. If there is any question that this debate should not go on, then I can only say that we accept the viewpoint of the house in general. I make it very clear and definite that if hon. gentlemen do not want a debate on external affairs at this time, then we are willing to accept that viewpoint. If hon. gentlemen will say "We do not want it", then I will say immediately we will accept that and proceed with the business for today.
I can say that in bringing this forward on Friday evening I outlined the request from the Leader of the Opposition during his speech and the request made by the hon. member for Vancouver East. However, if there is any question whatever that hon. members do not wish to give unanimous consent, then of course we are willing to defer this debate. I am not sure, though, that there would be any discussion of the matter before Christmas.


Mr. Speaker:: With all due deference to the suggestion made that we proceed now, if the motion is made the matter will be properly before the house. There are some preliminary matters to be disposed of before the orders of the day. Of course, the proposed motion could properly be made at any time and if the Secretary of State for External Affairs wishes to make his motion at this time I shall entertain it and then the pros and cons can be discussed. Otherwise I feel it would be in order to continue with the routine proceedings so they can be disposed of.


Mr. W. H. Jorgenson (Parliamentary Secretary to the Minister of Agriculture):: I wish to inform the house of a decision by the Canadian wheat board, pursuant to section 16 of the act, to exempt producers from delivery quotas on deliveries of grain to specified feed mills. I should outline briefly the background of this decision.
290	HOUSE OF
Exemption from Grain Delivery Quotas
When the Canadian Wheat Board Act was amended in 1950, feed mills were brought under its jurisdiction. They were thereby placed in the same category as country elevators and became subject to delivery quota regulations. As long as producers could deliver all their grain within a crop year, the enforcement of delivery quotas was not difficult. Since 1953 the quantity of grain on farms has been in excess of the available elevator space, and the enforcement of delivery quotas in the case of feed mills became more difficult.
In 1957 a Manitoba feed mill appealed a conviction for violating board delivery quota regulations. A similar case arose in Alberta in 1958. In both cases the appeal courts, in 1959, upheld the power of the board to regulate deliveries to feed mills. While the board's authority was sustained, there was a period of slightly over two years, from 1957 until late 1959, when the board was unable to enforce delivery quotas to feed mills because its powers to do so were before the courts.
In the meantime the matter was considered by the standing committee on agriculture and colonization. In July, 1959 that committee recommended that the position of feed mills in the grain trade should be clarified.
The committee again took up the matter in 1960. In its report of June 27, 1960, it found that too much inflexibility in the allocation of quotas to feed mills is not in the best interests of either the producer or the consumer of grains for feed. It recommended that the apparent discrimination between agreement and non-agreement mills be studied to maintain a fair position between them.
Early in the present crop year the board gave careful consideration to its position. The feed mills, in their representations and in their statements to the standing committee, had emphasized that they are engaged in a local business, that their operations are continuous and that their intake of grain should not be based upon space available from time to time in country elevators.
For its part, the wheat board appreciated that it is primarily engaged in the marketing of wheat, oats and barley moving in interprovincial and export trade, and that some relaxation in respect of controls applicable to the local trade of feed mills would not necessarily affect its over-all operations. In its examination of the matter the board gave consideration to the fact that probably less than 10 million bushels of grain were purchased by feed mills as compared with over 500 million bushels marketed by producers through country elevators.
In October the board met with representatives of the feed mills. The outcome was a


proposal which would exempt feed mills from delivery quotas if they in turn accepted certain undertakings. In these discussions, representatives of the feed mills expressed the desire that their problems should be met within the terms of the Canadian Wheat Board Act, and they indicated that they would be prepared to accept an annual contract with the board which would be applicable to all classes of feed mills.
It is on this basis that the wheat board has acted. The announced policy applies only to those feed mills which sign the necessary contract with the board. Feed mills signing the new board contract agree to purchase grain from permit holders within the province in which their feed mill is located and to use such grain for resale as "prepared" or "processed" feeds within the said province. Exceptions will have to be made in a few cases where feed mills are located close to provincial boundaries. Feed mills signing a contract with the board will purchase grain from permit holders on a non-quota basis at prices negotiated with producers.
This in brief, Mr. Speaker, is the policy which the wheat board has decided upon.


Mr. Hazen Argue (Assiniboia):: Mr. Speaker, I regret very much the announcement that has been made this afternoon, and I want to give one or two reasons. The Canadian wheat board, as the parliamentary secretary has said, appeared before the agriculture committee a year ago, but the Canadian wheat board very strongly protested the very policy that has been enunciated today. This policy will weaken beyond question the quota regulations that have been provided by the wheat board. The wheat board in policing its quota regulations has been upheld in the courts and therefore was in a position to maintain wheat quotas and wheat prices.
What will happen now is that it will be legal for feed mills to go out and buy grain from producers within that province at as low a price as they can obtain it. This means undercutting of the wheat board price. This means lower prices to the grain producers, and I am afraid it is just the thin edge of the wedge in undermining and destroying the quota system that has been built up over so many years.
In my opinion, Mr. Speaker, this announcement is an indication that this government has capitulated to the pressures of the private grain trade, and this policy that has been enunciated is a retrograde step.


Mr. Speaker:: Order.


John George Diefenbaker: Mr. Speaker, I do not want to make any reference that is not proper, but the

statement made by the hon. gentleman and which went far beyond what is proper and fitting, as I see it, cannot go unchallenged. I challenge the facts and also the conclusions expressed' by him.


Hazen Robert Argue: I accept the challenge.


Mr. Speaker:: In the closing remarks by the hon. member for Assiniboia I also felt that he had gone beyond the limit of recognized comment. He has commented on the statement, and the matter is one for debate at the proper time. However, the point taken by the Prime Minister was the reason for my rising at the time I did so.


Hazen Robert Argue: Mr. Speaker, if I may just give a brief explanation, I took a very active part-


Some hon. Members:: No.


Mr. Speaker:: Order. A point of order has been raised, and I think, the hon. member who has been called to order has the right to explain, provided he does not continue with the statement.


Hazen Robert Argue: Mr. Speaker, I wanted to explain that I had taken a very active part in the deliberations of the agriculture committee-


Mr. Horner (Acadia):: You attended about two committee meetings.


Hazen Robert Argue: -and in the discussion that went on in regard to this situation-


Some hon. Members:: Order.


Mr. Speaker:: Order. The hon. member is really not speaking on the matter which gave rise to the point of order.



COMMONWEALTH CONFERENCE


John George Diefenbaker: Mr. Speaker, I wish to announce that after consultation among the various commonwealth heads of government agreement has now been reached that a commonwealth prime ministers' meeting will be held in London beginning on the 8th day of March.
In the past I have stressed the usefulness of frequent and if possible annual meetings with commonwealth prime ministers. In view of the important international and commonwealth subjects which will be discussed, I am sure the house will agree that a meeting in March will be timely and significant and, I trust, beneficial to all members of the commonwealth.
Inquiries of the Ministry FINANCE



TEXTILES


Hon. Donald M. Fleming (Minister of Finance):: Mr. Speaker, I wish to table copies in English and in French of two further reports which I have received from the chairman of the tariff board relating to reference No. 125, textiles. These are the board's sixth and seventh reports pursuant to this reference. I am also tabling transcripts of evidence presented to the board at its public hearings.
The sixth report covers narrow fabrics, lace and embroideries, and firehose. It was received while the house was in recess, and I released it to the public on October 17.
The seventh report, which I have just received from the tariff board, deals with manufactures of wool or hair and related products. I have had prepared a brief statement summarizing the principal features of this latest report. It may be that this summary would be of interest to some members of the house, and I would be glad to table it if I have unanimous consent to do so; otherwise copies will be available in my office to hon. members as may desire copies.



PUBLIC SERVICE


John George Diefenbaker: Mr. Speaker, I wish to announce the appointment of Mr. J. D. B. Harrison as deputy minister of forestry. Mr. Harrison has had a long and distinguished career in the service of this country. In February, 1957 he became director of the forestry branch. Prior to that, between 1951 and 1957 he was chief of the forestry research division of the Department of Northern Affairs and National Resources, and has published many articles and papers on forestry matters.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Hon. L. B. Pearson (Leader of the Opposition):: Mr. Speaker, I would like to ask the Prime Minister whether he is in a position to make a report on the talks with the railways and the unions held yesterday and this morning, and in so doing whether the Prime Minister would indicate to the house whether he agrees that the basis of settlement should be the report of the reconciliation board.

Inquiries of the Ministry


John George Diefenbaker: Mr. Speaker, conversations between the representatives of the railway companies and the chairman and representatives of the unions continued this morning and again yesterday afternoon. I am advised that no material progress toward settlement can as yet be reported.
At 3.30 this afternoon I intend, along with my colleagues, to meet with the representatives of the railway companies and the unions with a view to ascertaining whether there is any vestige of hope that a settlement will be arrived at. I may say that if as a result, it becomes clearly apparent that there is no hope of agreement, the government will then take it that the possibility of a continuance of the collective bargaining process must regretfully be regarded as ended.
With respect to the latter part of the question of the Leader of the Opposition, I may say that it would not be helpful at this time to give an answer, due to the fact that discussions are still continuing.


Hazen Robert Argue: Since discussions are still continuing, I wonder if the Prime Minister can say whether the government has any particular proposal to place before the disputants at the meeting this afternoon.


John George Diefenbaker: I think I have already answered that question, by inference, in giving the answer I did to the latter part of the question asked by the Leader of the Opposition.



RESTRICTIONS ON STRATEGIC EXPORTS

[Stage Direction]
On the orders of the day:
Mr. Lucien Cardin (Richelieu-Vercheres):: wish to direct a question to the Minister of Trade and Commerce. Yesterday, answering a question I asked on Friday last, the minister stated there were goods other than arms and munitions included in the export control list which were subject to export restrictions to sino-soviet bloc countries. Do these restrictions apply equally to our export to Cuba?


Hon. George H. Hees (Minister of Trade and Commerce):: I should like to take that question as notice.



RESTRICTIONS ON STRATEGIC EXPORTS TO COMMUNIST COUNTRIES

[Stage Direction]
On the orders of the day:
George Harris Hees: Yesterday when I replied to a question with reference to restrictions


on strategic exports to communist countries, the hon. member for Ottawa West asked a supplementary question:
Is nickel, copper or aluminum under strategic control?
In reply I wish to state that copper, aluminum, and nickel metal are not included in the export control list. Raw materials from which nickel can be extracted, certain nickel base alloys, and certain forms of nickel which have an application in the field of atomic energy are presently under strategic control.



CO-OPERATION OF PROVINCIAL GOVERNMENTS IN OTTAWA CONFERENCE

[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Pori Arthur):: Mr. Speaker, I should like to address a question to the Minister of Trade and Commerce relating to his rally in connection with trade. Those of us from Ontario are interested in the attempts of Premier Frost and his government to increase trade. I wonder whether there has been any attempt at liaison and co-operation in getting provincial governments who have trade missions in offices abroad to take part in the rally that is forthcoming.


George Harris Hees: Mr. Speaker, there is always the closest co-operation between this government and the government of Ontario, as there is with every other provincial government. It just so happens that I was talking to Hon. Mr. Nickle this morning. He is in charge of these matters for the Ontario provincial government. We had a very interesting and constructive conversation over the telephone, as a result of which he and the appropriate officials of his department will be meeting with me and corresponding officials of my department here in Ottawa in the very near future for what we consider will be a very constructive discussion.



DEFENCE PRODUCTION


[Stage Direction]
On the orders of the day:
Mr. Hubert Badanai (Fort William):: I wish to direct a question to the Minister of National Defence. I understand that the minister recently attended a demonstration of the Bobcat vehicle. Can he inform the house whether the government has made a decision concerning the production of this vehicle?



I960

Hon. D. S. Harkness (Minister of National Defence):: The short answer is no. I did attend a demonstration of the Bobcat, which was quite impressive. Tests of this vehicle are still continuing.


Hubert Badanai: Mr. Speaker, I should like to address a question to the Secretary of State for External Affairs. Can the minister tell us whether the government has given any consideration to donating vehicles such as the Bobcat to our beneficiaries under the Colombo plan?


Some hon. Members:: Order paper.


Hon. Howard C. Green (Secretary of State for External Affairs):: No, Mr. Speaker.



CANADIAN NATIONAL RAILWAYS


[Stage Direction]
On the orders of the day:
Hazen Robert Argue: I wish to direct a question to the Minister of Transport. Would the minister care to comment on the charge contained in a telegram from the secretary of the machinists' local at Moncton, New Brunswick, that there have been unnecessary and spiteful lay-offs of non-operating employees, and that this occurred to such an extent that on November 26 no spare locomotive was available for hauling traffic?


Hon. Leon Balcer (Minister of Transport):: I received notice of this question as I was walking to the house. I shall make an inquiry of the management of Canadian National Railways and report to the house as soon as possible.


Hazen Robert Argue: Perhaps when the minister is making this inquiry he would make it in a broader way to ascertain whether there is evidence that the railway companies have been dismissing employees in what might almost be described as a lock-out in advance of any formal strike decision.


Léon Balcer: Perhaps I could answer that question in this way. In replying to a question asked by the hon. member for Kootenay West, I think, on almost the same lines I said the management of the C.N.R. had advised me that work force reductions which have been made were made as part of the adjustment which must accompany a variation in traffic volume.
Inquiries of the Ministry HOUSE OF COMMONS



INQUIRY AS TO FILLING OF VACANCIES IN REPRESENTATION

[Stage Direction]
On the orders of the day:
Hon. J. W. Pickersgill (Bonavista-Twillin-gale):: I wonder if I could ask the Prime Minister whether the government intends to take steps immediately to ensure that all the electors in Canada will be represented in this house at the earliest possible date.


Mr. Speaker:: The Minister of Trade and Commerce.


John Whitney Pickersgill: Surely the Prime Minister intends to reply.


Mr. Speaker:: The hon. member for Bona-vista-Twillingate knows that it is not in order to comment on an answer or on the absence of an answer.


John Whitney Pickersgill: I wonder whether I could direct a question to the Prime Minister. Has the government yet taken the necessary steps to authorize the chief electoral officer to issue the writ in the constituency of Esquimalt-Saanich?


An hon. Member:: The Liberals are not going to win it anyway; quit worrying.


John George Diefenbaker: Mr. Speaker, I can only say this. When the government arrives at a decision it will be announced to the house. This government has always followed the course of seeing to it that within a reasonable period electors are represented in the house, instead of waiting, as has been the case in the past, for a long time.



FISHERIES


[Stage Direction]
On the orders of the day:
Mr. H. J. Robichaud (Gloucester):: May I
direct a question to the Minister of Fisheries. As the cost of construction of fishing vessels has been increasing steadily for the last 15 years, and as the plan for assistance has not been amended since 1946, will the minister advise the house whether any consideration is being given by the government to amending the assistance for the construction of vessels of the dragger or long liner type? If so, is the minister in a position to report to the house on the nature of such amendments?


Mr. Speaker:: I do not know whether the hon. member has given notice, but the preface to his question rather indicated that

Inquiries of the Ministry the urgency of this problem which has been developing over 15 years would not be hurt if he put the question on the order paper.


Hédard-J. Robichaud: On a point of order, Mr. Speaker, this matter has been brought to the attention of the government for the last two years, and we have just reached the period of another construction season.


Mr. Speaker:: I see the hon. member's point, but my objection is that the procedure available on orders of the day is really not to debate a matter on which a member may be finding difficulty in getting the government to act.


Hédard-J. Robichaud: I should like to direct a question to the Minister of Fisheries. Can the minister advise the house whether he expects to be in a position before the Christmas recess to announce proposed amendments to the assistance for construction of vessels of the dragger or long liner type?


Hon. J. A. MacLean (Minister of Fisheries):: Mr. Speaker, this matter is under study by several departments of the government. If any change in policy is made it will be announced to the house. I would not like to predict when such a change in policy might occur.



CANADIAN PACIFIC RAILWAY


[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, I wish to direct a question to the present Minister of Transport in connection with a statement made in the house this year by the former minister of transport.
In view of the fact that a number of members of this house have brought to the attention of the government the plight of certain pensioners and certain injustices they are suffering at the present time, and in view of the fact that the former minister assured those members that he would bear what they had said in mind, would the minister inform the house whether any steps have been taken to persuade the officials of the Canadian Pacific Railway Company to remedy this situation?


Léon Balcer: Mr. Speaker, I am advised that after the discussion in the house mentioned by the hon. member, my predecessor received a further communication from the chairman of the Canadian Pacific pioneers' pension committee, Pacific region, and that he referred these representations to the Canadian Pacific Railway Company.


This was the only course of action open, as I know the hon. member will appreciate that we have no control over the administration of the C.P.R. I can, however, assure my hon. friend that I shall at once draw this further inquiry to the attention of the management of this company.



NORTHERN AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. Eldon M. Woolliams (Bow River):: Mr. Speaker, I should like to address a question to the Minister of Northern Affairs and National Resources. Certain lands were allegedly expropriated in the anthracite area near Banff, Alberta, by the Department of Northern Affairs and National Resources in 1956. As certain technicalities have arisen in reference to title, will the minister please report as to the present position of these expropriation proceedings? When may the land owners expect to receive some or partial compensation for the lands taken from them?


Lionel Chevrier: Order paper.


Mr. Speaker:: Order. I am not sure whether the hon. member gave notice, but he did not indicate it. The question is one very appropriate for the order paper.



PRIVILEGE


[Stage Direction]
On the orders of the day:
Mr. Walter Pitman (Peterborough):: Mr. Speaker, I rise on a question of personal privilege. I should like to reply to the hon. member for Bow River (Mr. Woolliams) in regard to the remarks he made last night. I have checked the report with reference to myself, and I should like to say I did not make the statements so reflecting upon the relationship between the member and his constituency. I should like to place upon the record that I have the greatest respect and admiration for hon. members and their relationship with their constituencies.


An hon. Member:: Read a newspaper.


Walter George Pitman: With regard to the other matter, Mr. Speaker-


An hon. Member:: Can he read?


Mr. Speaker:: Order. The hon. member is rising on a question of personal privilege, and I think the house might hear what he has to say.

External Affairs


Walter George Pitman: My final remarks in regard	ROYAL CANADIAN AIR FORCE
to other matters which the hon. member for
Bow River mentioned I should like to make uplands airport-reported seizure of station when it is in order to do so.	newspaper



ARTS, LETTERS AND SCIENCES NATIONAL GALLERY  REQUEST FOR WEDNESDAY EVENING OPENING

[Stage Direction]
On the orders of the day:
Louis-Joseph-Lucien Cardin: Mr. Speaker, I should like to address a question to the Minister of Citizenship and Immigration. Will the minister inform the house whether there would be any inconvenience in having the national gallery of Canada open Wednesday evenings instead of Tuesdays, to give members of parliament an opportunity of visiting the art exhibits on an evening when the house is not sitting?


Hon. Ellen L. Fairclough (Minister of Citizenship and Immigration):: I shall be very glad to consult with the officials of the gallery. Since the house only sits part of the year I believe the arrangements for having the gallery open at night depend to a large extent on the availability of staff. It is open more for the convenience of the general public than members of parliament, but I shall be pleased to take it up with the officials of the gallery.



IMMIGRATION


[Stage Direction]
On the orders of the day:
John Whitney Pickersgill: Mr. Speaker, may I ask the Minister of Citizenship and Immigration whether she or her department now requires West Indian students to get the permission of the department to travel from one province to another?


Ellen Louks Fairclough: I am sorry; I did not hear the last sentence.


John Whitney Pickersgill: Does the minister or the department require West Indian students at Canadian universities to get the permission of the department to travel from one province to another?


Some hon. Members:: Order paper.


Ellen Louks Fairclough: Mr. Speaker, I have never heard of any such provision if they are casual visits. If it means a change from one university to another for study I think they would require departmental permission.


John Whitney Pickersgill: Will the hon. lady inquire into the matter and report at a later date?
On the orders of the day:


Hubert Badanai: Mr. Speaker, I should like to address a question to the Minister of National Defence. Will the minister comment on a report appearing in this morning's Globe and Mail to the effect that copies of the Uplands Times, which is a paper published by the R.C.A.F., have been seized by the R.C.A.F. police because an editorial in the paper dealing with airplanes was adjudged to be in bad taste?


Douglas Scott Harkness: Mr. Speaker, I received a report on this incident, which is as follows. Contrary to normal practice, the editorial appearing in the station newspaper at R.C.A.F. station, Uplands, had not been cleared by the editorial board prior to publication, and was written during the absence of the regular editor of the newspaper. The editorial referred to the possible replacement of the CF-100 aircraft. Since a decision in this matter is a governmental responsibility, the station commander considered that the editorial was not in good taste and ordered the papers already distributed withdrawn from circulation.


EXTERNAL AFFAIRS
Howard Charles Green: Mr. Speaker, I find myself in a very difficult position today. I suspect that really I just happen to be the fellow who had to get a long speech ready for this afternoon. If I have unanimous consent I propose to move the adjournment of the house, the idea being that we may have a debate on external affairs.


Lionel Chevrier: Mr. Speaker, as the house knows this motion is not debatable, and I rise on a point of order to discuss the matter which was introduced earlier by the Prime Minister and now by the Secretary of State for External Affairs by way of a proposed motion. Before the Prime Minister resumed his seat he said that so far as he and his followers were concerned they were in the hands of the house, and that goes for the opposition as well. We too are in the hands of the house, but unfortunately that is not the position which the Prime Minister took the other evening when he used words to this effect: "It is our intention to proceed". I will deal with that a little later.

External Affairs
I want to put on record the difference between the attitude advanced by the government at this time with respect to such a debate and that which was advanced by those of us who sit in the opposition when we were in office.


Mr. Speaker:: Order. Before the hon. member proceeds, may I say that I think the point of order is fully understood by the house. If the house wishes to hear the matter discussed there is no reason why it should not be discussed, but the point is relatively simple. The Secretary of State for External Affairs proposes to move the adjournment of the house in the way it has been done in the past-


Lionel Chevrier: No, sir.


Mr. Speaker:: -by suspending the standing order, which would make the motion not debatable. This can only be done, of course, with the unanimous consent of the house, because suspension of the standing order which would prevent a debate on the motion to adjourn is essential. That part is relatively clear, and the simple question is whether the house gives unanimous consent or does not. That is the question which it is my duty to ascertain. If the house does not, then the procedure cannot be followed. Unless the house instructs me that I shall hear discussion with respect to what has been done at other times, I consider any such discussion to be irrelevant.


Lionel Chevrier: Mr. Speaker, if I may respectfully disagree with you, I do not think we are proceeding now as we did in 1954 and 1957. In the second place, sir, I desire to be heard on a question of order. The motion made by the Secretary of State for External Affairs is entirely out of order because it is not debatable. I have risen on a point of order and on two occasions I have been interrupted. If Your Honour tells me I can go no further I will resume my seat, but I submit to you with deference that under the rules of the house I have the right to establish here and now the difference between the procedure that is being followed now and that which was followed earlier. That is all I am seeking to do.


Mr. Speaker:: As I understand the motion which has been placed before the house by the Secretary of State for External Affairs in accordance with the earlier announcement by the Prime Minister, it is that this house do now adjourn and that in order to permit a debate on external affairs standing order 32, subsection 2, shall be suspended in relation thereto. This is a motion that has been 
made before but only with unanimous consent. I must rule the motion out of order unless the house gives unanimous consent.
As far as I am concerned, as I see the matter and with all due deference to the hon. member's desire to deal with the circumstances which surround the moving of the motion, these circumstances are not relevant to the point of order. The point of order is that such a motion cannot be made without unanimous consent, and it is my duty to ask the house whether it gives unanimous consent. That is the only point that is before the house at the present time. If any hon. member objects to the motion being made I shall not accept it.


Lionel Chevrier: Your Honour did not rule on the point of order that I raised, and if Your Honour rules against me then I wish to raise a question of privilege. As house leader for the official opposition I have certain responsibilities in connection with the business of the house, and one of those responsibilities is to arrange with my opposite number on the other side the business of the house for the next day. On no occasion when in consultation with the government house leader or the acting house leader was unanimous consent given that this matter would be debated at this time. On the contrary, it was clearly set out by me and those associated with me that while external affairs are extremely important, the position was not so sex-ious that a debate could not be withheld for a couple of days so that we could deal with the emergency legislation which the government has introduced.


Mr. Speaker:: In order to shorten the matter, may I say that I do not understand that there has been any assertion made that unanimous consent has been given or promised. I understood the Prime Minister to say earlier in the day, and if I am not correct he will correct me, that if the house was not prepared to give unanimous consent then the matter would not be proceeded with. There was no assertion either by the Secretary of State for External Affairs or the Prime Minister that unanimous consent had been promised. Therefore I suggest to the hon. member that he has set up a question of privilege which does not arise. What I should like to ask the house is whether it gives unanimous consent to the motion being made.


Lester Bowles Pearson: On the question of privilege, this discussion arises because of a statement made by the Prime Minister earlier in this sitting, when he indicated that this motion might be proceeded with because, for one thing, I had asked for a discussion of external affairs, and also because the procedure was similar in

character to the procedure followed in 1957. If the Prime Minister had not made that statement at that time we would not be discussing this matter now, but he did make it, containing two observations that we do not feel are accurate. In the first place, I did not ask for a debate on external affairs at the present time.


Mr. Speaker:: Order. I am sorry to interrupt the Leader of the Opposition, but what he is adverting to is a discussion that took place earlier. The matter I have to deal with is one that has come before the house at this time, namely a request for unanimous consent to move a motion for adjournment of the house for the purpose of carrying on a debate on external affairs. If there is any dissident voice the matter obviously cannot be proceeded with, because the rules require notice for suspension of the rule so as to permit this debate to take place. Therefore I have only to ask the house whether it is willing to give unanimous consent. Perhaps the Leader of the Opposition would address himself to that point. If there is a matter of privilege it can be heard at any time, but I should like to deal with the question now before the Chair, whether this motion should be accepted.


Lester Bowles Pearson: On that point, Mr. Speaker, the Prime Minister did raise certain questions which we would have been happy to discuss with him at that time but you ruled them out of order. For instance, the question of unanimous assent undoubtedly depends on the urgency of the international situation at the moment. If the Prime Minister had said that it is of urgent importance to discuss today international affairs and to hear statements by himself and the Secretary of State for External Affairs, we on this side would, of course, have given unanimous consent. However, if it is not of such urgency, should we not discuss the unemployment emergency, which we think would be the better course?


John George Diefenbaker: Mr. Speaker, I made it very clear at the opening of the house that the motion required unanimous consent. I therefore suggest that you put the question to ascertain whether or not there is unanimous consent. If there is not we will be glad to accept the decision, because we are in the hands of the house.


Mr. Speaker:: Order. The question before the house is, does the house give unanimous consent to the moving of the motion proposed by the Secretary of State for External Affairs? Those in favour of unanimous consent will say aye.


Mr. Winch:: 
Mr. Speaker:: The hon. member asks whether or not-


Harold Edward Winch: There has been unanimous consent by this party.


Mr. Speaker:: -I will hear a statement on the matter. I will not do so in the middle of putting the question. Those in favour of giving unanimous consent as requested, please say aye.


Some hon. Members:: Aye.


Mr. Speaker:: Those opposed please say no.


Some hon. Members:: No.


Mr. Speaker:: I hear one dissenting voice at least, so-


Donald Methuen Fleming: Mr. Speaker, the Leader of the Opposition and the hon. member for Laurier both said no.


Lester Bowles Pearson: Mr. Speaker, on a question of privilege; the Minister of Finance having intervened in the matter, perhaps I may be permitted to reply to his gratuitous comment. If the Prime Minister will tell us-


Some hon. Members:: Order; this is not a question of privilege.


Lester Bowles Pearson: -that it is urgent for today -I ask for order, Mr. Speaker.


Mr. Speaker:: Order. The Leader of the Opposition was right in raising his question of personal privilege, but he is now reverting to a matter which, in my view, is not relevant to the decision I have to make, and that is whether or not there is unanimous consent. I have come to the conclusion that there is not unanimous consent; therefore the motion proposed cannot be made.


Lester Bowles Pearson: On the question of unanimous consent, we on this side prefer to debate external affairs after the unemployment measures have been discussed.


Mr. Speaker:: The question of the pros and cons of unanimous consent is not debatable, because a decision has been taken. The house will proceed to the next order of business.



FINANCE


[Stage Direction]
The house resumed from Monday, November 28, consideration in committee of Bill No. C-40, respecting loans to proprietors of small business enterprises for the improvement and modernization of equipment and premises- Mr. Fleming (Eglinton)-Mr. Flynn in the chair.
298	HOUSE OF
Guarantee of Loans to Small Businesses
On clause 2-Definition.
Mr. Pelers:: Mr. Chairman, during the debate last night many hon. members who in my opinion were favourable to both credit unions and the caisse populaire were not in agreement as to whether these organizations should be included as lending institutions within the definition contained in this measure. The minister pointed out that in the past these organizations had not proven effective under the Fisheries Improvement Loans Act because in no case had a caisse populaire made a loan under the provisions of that act, and only on a limited number of occasions had there been any loans made by credit unions.
However, Mr. Chairman, it would seem to me that this is not necessarily the same type of case. The amount of money involved in loans in this case may be small and it may be possible for the credit union movement, which in the main is concentrated in geographical locations other than along the coast line, to take advantage of the provisions of this measure.
It was pointed out that there was a clause in the Fisheries Improvement Loans Act setting the interest rate to be charged, and the same thing could be done in this particular case if there were any question about the fact that credit unions can charge a greater rate of interest than the banks. However, I think it should be noted, when we refer to the credit union movement, that all across this country and in the United States as well the credit union movement has a bylaw stating that the organization cannot charge more than 1 per cent per month on the unpaid balance. This is the maximum the credit unions, by their own constitution, have allowed, and in many cases the interest rate is much lower than this figure and is much lower than the rate charged by the banks.
I was concerned, Mr. Chairman, about a statement made by the minister in which he referred to the fact that he held no brief for the banking institutions. Then he went on to say he had discussed this matter with the banks and they had agreed to make loans under this legislation if the bill were passed.


Donald Methuen Fleming: I suggest that the hon. member, if he is going to refer to my remarks, should quote them and quote them exactly.


William Arnold Peters: I do not wish to quote the minister's remarks exactly. I wish to paraphrase them, and he is at liberty to rise and correct my interpretation if he thinks it is wrong. It is surprising that this matter should have been discussed to the extent that the interest rate may have been established, yet no provision was made for the participation of other organizations, namely the caisse populaire or


the credit union. Both these are expanding organizations. The amount of money these institutions have available for lending purposes has been increasing, and this amount would be available for investment in enterprises that are valuable to the community and to the membership of the credit unions, such as the maintenance of small businesses.
So, Mr. Chairman, I suggest that if the Conservative party is sincere in its respect for the caisse populaire and credit union movement, it should do as the former government did, on the advice of the banking committee, and make provision for the credit union and caisse populaire to be brought within the terms of this bill.


Mr. Creslohl:: I should like to offer the minister another reason for the inclusion in this legislation of other lending institutions. I draw to his attention that by limiting the right to the banks to make these loans this legislation is, in some form, creating a combine. Perhaps this is unintentional, but the banks are given the exclusive right to make loans while there are in this country other lending institutions. Why should we, by this piece of legislation, give a privilege to only one group of lending institutions and deny that same right to another group? This is clear discrimination.
Let me give another illustration. There is nothing in the measure that compels a bank to make these loans. Assuming therefore that the bill is passed and that the banks in their own wisdom decide that they do not want to take on this business, we shall then have adopted a piece of stillborn legislation with no life and no usefulness at all, and we shall not have given the small businessmen in this country the relief which they want. In this legislation we are not saying that the banks are obliged to make these loans provided these conditions are met. We give the banks the right themselves to decide, and that is the way the situation should be. However, if the banks, as such, refuse to take on this business we are stymied. We cannot go to other lending institutions, which we should have the right to do. Therefore the legislation becomes completely useless.
I should like the minister to deal with that phase of the matter. I consider it to be an extremely important phase. Unless he puts into this legislation teeth that will compel the banks to make these loans, he has no right to restrict to banks only, the power to do so. That action would be creating a combine and, in my opinion, a highly dangerous combine for the government inadvertently to set up.


Mr. Nasserden:: Mr. Chairman, I find these discussions most interesting, to say the least. I have watched the credit union movement

as it has grown in the province of Saskatchewan and indeed I consider it an honour to be one of those who have served as director of a credit union in that province, namely the Saskatoon and district credit union. I recall my association with those who served on that board, and I do not hesitate to say that there is not any better group of businessmen anywhere in Canada.
The antics of the opposition on this measure betray one of two things. They betray either an ignorance of credit unions and their position or else a narrow, selfish, partisan desire to try to label this legislation anti-credit union, in a desperate effort to obscure the value of this legislation to those co-operative associations that are in need of guaranteed bank loans. Indeed, Mr. Chairman, as I listened to them last night, and particularly to the hon. member for Assiniboia, I was convinced that both these premises have prompted those ill-considered statements that were offered as arguments at that time.
Credit unions came into being because of the lack of credit facilities in this country. In order to protect the depositor the Canadian Bank Act provides certain restrictions which, in the course of good banking practice, limit the extent to which credit is available to individual customers. Sometimes the attitude of bank managers has constituted a restriction on credit to ordinary people. In any event, credit unions are composed of people who have pooled their savings in order to establish credit for themselves when they need it. These credit unions are, of course, subject to regulations designed to protect the depositors. Boards of directors of credit unions have of necessity utilized a portion of these assets which they hold, in the form of government or other negotiable bonds and securities which are readily convertible at the call of depositors.
I believe that a study of the balance sheet and operations of credit unions in the province of Saskatchewan would reveal the fact that they are having a difficult time to service the borrowing demands of their own members at the present time. That consideration is, perhaps, one of the reasons for the apparent lack of interest in government guaranteed farm improvement and other loans at this time.
Instead of holding up this legislation and so desperately trying to impute ulterior motives to the government, that so-called, self-styled champion of the co-operative way of doing things, namely the hon. member for Assiniboia, could serve the members of cooperative associations much better by helping this legislation along so that in those areas where people have found it necessary to take co-operative action to solve their problems,
Guarantee of Loans to Small Businesses they may have at their disposal at least the machinery set up by this measure that will enable them to secure guaranteed bank loans in order to modernize and improve their equipment and premises to the end that they may obtain the maximum saving in that effort.
This measure, Mr. Chairman, as it stands extends to co-operative associations the same measure of guaranteed credit facility as it does to the corporate or individually owned business enterprise. To the extent that cooperative associations choose to make use of it-


William Arnold Peters: I rise on a point of order, Mr. Chairman. May I inquire what the hon. member is reading from?


The Chairman:: Order. The hon. member for Timiskaming has raised a point of order as to whether the hon. member was reading his speech or as to what document he was reading from.


Edward Nasserden: That is a good question. Mr. Chairman, I think I was consulting my notes in much the same way as the hon. member does on certain occasions.
The point I was trying to get at when I was interrupted was this. To the extent that co-operative associations choose to make use of the money available under this measure, other money will be available to individual members of their own organizations, on appraisal of their character, as an alternative to being left to the tender mercies of the friendly finance companies, as they certainly would be left to those tender mercies were there no such provision in this legislation.
The hon. member for Assiniboia need not think for one moment that he can fool anyone in the credit union movement. That movement is in the process of expansion today, as it has been since it first began in Canada. The policy of progressive credit unions and their boards of directors has always been to maintain effective reserves in order to protect their membership. During the past several years, and particularly since this government came to office, these boards of directors have found it increasingly attractive to purchase bond offerings of a wide variety. In this way the savings of credit union members have helped the tremendous capital development and expansion that have characterized the period since this government took office in Canada. As a direct consequence it has been increasingly difficult for credit unions to satisfy the legitimate credit needs of their own members.
I would therefore think that the members of credit unions would certainly not appreciate, at this particular time when their ability to satisfy their own members is under strain,

Guarantee of Loans to Small Businesses the further unsolicited burden of supplying loans to small business at 5 per cent or 6 per cent interest.
(Translation):


Mr. Sevigny:: Mr. Chairman, I should like to make a few remarks on the legislation under discussion.
It is obvious that the present government has no intention whatsoever, in introducing this bill, of discriminating against the merits and effectiveness of the caisses populaires and their counterpart, the credit unions, in the neighbouring provinces. We all feel great respect and, indeed, deep admiration for the fine work accomplished by credit unions and caisses populaires on the national scene. But we must nevertheless recognize a simple fact: in this house we legislate in the federal field only and the caisses populaires, as well as the credit unions, are credit and finance institutions which come under provincial jurisdiction.
Moreover, that situation was clearly explained by the Minister of Finance (Mr. Fleming); besides, it seems unlikely that the Canadian people would resort to the caisses populaires and credit unions for the purposes of this legislation.
In spite of all the respect I have for the talent and legal qualifications of the hon. member for Cartier (Mr. Crestohl), I must say that I am a bit surprised by the remarks he made a moment ago. Unless I misunderstood him, I had the impression that the hon. member for Cartier was blaming the government for not using coercion to compel banks to grant loans to all those who apply for them, without too much concern for the character of the borrowers.
Those remarks seem rather strange coming from the hon. member for Cartier. After all, a fact must be recognized: this is a free country, not an economic dictatorship with a controlled economy. What would the Canadian people think of a government which would say to the chartered banks of this country: you will lend, you are under an obligation to do so, to every person asking for a loan, no matter what their qualifications, collateral and character.
To my mind, it is indeed strange in a democratic country such as ours to expect the government to lay down such conditions to our banking institutions. I think, on the contrary, that it is very wise to let our chartered banks find out by themselves what the borrower is worth, and more particularly the character of the person who is going to have to repay the loan over the years.
After all, Mr. Chairman, it must be recognized that our chartered banks play a very

prominent part in our national economy, I would even go as far as saying the most important part.
Our bank managers have too often been criticized-and here I must challenge the words I have often heard expressed by my friends of the extreme left-for their attitude toward those who come to them because they want to borrow some money. Instead of criticizing the chartered banks, I think we should give them the praise they deserve for the wonderful part they have played in the development of our economy. Come to think of it, there are very few communities in our province and throughout Canada where there is not a branch of a chartered bank, whose importance varies according to the nature and volume of local business. No one in our villages, municipalities and towns can better appraise the character of those with whom they do business than the bank manager and his staff. Consequently I am of the opinion that we would do the community, and therefore the country, a disservice in taking away from this bank manager, as well as from his staff, the right to exercise his judgment as to the character of those who come to him for a loan.
I think that if we were to make a survey of what happened in the past we would find that the banks as a rule have loaned money properly and that they have exercised a sound judgment in granting credit to applicants for loans.
As far as I am concerned, I believe we are doing the right thing in leaving it up to the bank managers to decide whether or not a certain individual, a certain businessman, deserves the confidence of the bank.
I do not wish to delay unduly the present debate. I know it is of the utmost importance that this measure be passed as soon as possible and implemented at the earliest possible date. But I sincerely believe that it is not fair to blame the government for not compelling the banks to take any kind of risk. My hon. friend opposite, the hon. member for Cartier, will surely not hold it against me if I do not agree with him.
(Text):


Leon David Crestohl: Mr. Chairman, I would like to clarify some things that perhaps the minister did not quite grasp. It is not suggested that legislation should be adopted to compel banks to make these loans. The suggestion is that if we want to make these funds

available to small business, let us make the legislation as wide as possible so that small business may obtain money.
Let me give an example, and I am sure the minister, with his native intelligence, will follow me. When one looks at this legislation one sees the conditions which are laid down before a bank can lend money. We tell the banks, "You can lend this money" under these and these conditions, and there is a whole list of conditions. The banks in a democratic country, as we are here, are privately owned institutions; they have a right to say "We do not mind lending money, but not under these conditions. These conditions are a little too restrictive for us, and we do not want this type of lending business".
However, the legislation says to the people of Canada, "You cannot ask for a loan under these terms from any organization except a bank". Caisses populaires and credit unions are not the only lending institutions in this country; there are trust companies, lending companies, syndicates of various sorts, all of them looking for this kind of business. Therefore if the banks say no because these conditions are too arduous for them, perhaps competitors of the banks will say yes because they are not as arduous for them. I suggest that the legislation, in limiting this right only to banks and in refusing to extend the definition to include other lending institutions, is restricting the field in which the Canadian public can seek this relief. That is all I said.
If, on the other hand-and I will illustrate it again-the legislation did provide some means whereby the banks were obliged to make these loans-and I do not favour such a course-the minister is perfectly right. If that were the case, of course it would be certain that the public would have a source from which to obtain money. But since the banks have a complete right to refuse to take this business, and can decide in their wisdom to refuse to take it, what will we have accomplished by this legislation?
We should give the people of Canada as wide a range of sources of these loans as the law can possibly give. I suggest that credit unions may be one source, caisses populaires may be another, trust companies may be another, and even lending companies, loan syndicates and other organizations may be others.
The minister has said these people are scalpers; that they will insist upon their usual rate of interest. The minister may be right. However, the government could say, "We will not guarantee a loan made by anyone in Canada if the rate of interest charged is greater than 6 per cent", or greater than
Guarantee of Loans to Small Businesses the normal bank interest rate. There is a safety valve to protect the people of Canada, to provide that these other lending institutions shall not charge a higher rate of interest than the banks.
I do not know why the minister should want to restrict to the banks the source of funds for the people of Canada. There are other people in the business of lending money in this country; they pay taxes, employ people and are not restricted by federal legislation from making loans. We are allowing, in a manner of speaking, a sort of combine. We are giving a control, a privilege, a monopoly to the banks; and why should we give a monopoly to the banks to be the only organizations to perform this job of lending money when there are competitors in this field in the country?
That is what I meant. I certainly was not advocating that we should adopt legislation to compel the banks to make these loans, but if it is desired to restrict this to the banks alone, then I think the government should make certain that the banks make these loans available. We have heard nothing from the minister or from the government informing us that they have been in negotiation with the banks and that the banks have given them an assurance that they will make these loans under the conditions set out. In my opinion the country is being treated to a little shadow boxing. I see nothing in this legislation which would ensure that the small businessmen of Canada will be able to get these loans through the banks; and if they cannot get them through the banks, why restrict them in their efforts to obtain loans elsewhere?


Mr. Pugh:: On rising today I should like to congratulate the government and the Minister of Finance on this legislation. This has been done many a time before, but I repeat it because congratulations are due. It is time hon. members of the opposition realized that this is yet another effort to make further credit available to those who need it and, in particular, to small businesses.
Last night a red herring was drawn through the discussion of this admirable piece of legislation. I should prefer to take the word of the hon. member for Marquette, who spoke last night, and of the hon. member for Rosthern, who spoke today. Their words clearly set out the origin and the usefulness of credit unions in Canada. Those words, believe me, are sensible. Every one of us who has had anything to do with the credit union knows the truth of those words. We heard about initial co-operation; we heard about rates of interest; we heard about long term loans, and we heard

Guarantee of Loans to Small Businesses about insurance funds. All these things are good. However, we also know this; that in the form in which this legislation is presented, the chartered banks of Canada are enabled to lend money at reasonable rates of interest on a long term basis. The whole of this legislation is designed to help small businesses.
As I listened to the hon. member for Timiskaming today I heard him say that the maximum interest rate imposed by the credit unions is a total of 12 per cent per annum; that is, 1 per cent per month on the unpaid balance. If you work that out you will find it comes to 12 per cent exactly. The hon. member continued to say-and I am using his own words-that quite often this is much less than the rate charged by the banks.
Surely if the hon. member is correct in that assumption any small business in Canada can go to a credit union, as has been done on many occasions in Canada, and borrow money at less than the rate of interest charged by the banks. From my own experience I know that they do, in fact, borrow money from credit unions at varying rates of interest. Sometimes these rates are fixed at about 6 per cent. I have never heard of a rate below 6 per cent. In any event, if they can borrow at a lower rate of interest, then let them go ahead and borrow. Surely that is the answer.
As far as the hon. member for Cartier is concerned, one would think the government was setting up something which would continue for all time, something which could not be amended by any future act of parliament. "A combine", he said it was; "denying rights to other lending institutions". The hon. member concluded by saying this was stillborn legislation. Surely the step which has been taken by the Conservative government in bringing forward this beneficial and necessary legislation should be appreciated by all members of parliament. If it should be found in the future that more money is needed than is at present available under the terms of this measure, then surely it will be open to parliament to put through an amendment which would go a further step and include other lending institutions, whether credit unions or other organizations.
There are many other features in this bill upon which I should like to comment. In the Okanagan valley, which is a veritable tourist resort, we shall no doubt feel the beneficial effects of this legislation. Certainly I do not intend to take the time of the committee in reviewing the many projects for which this money could be used. I should like, however, to conclude by once more offering my solid congratulations to this government on having brought forward this
TMr. Pugh.]
very necessary legislation which will undoubtedly help all types of small business in Canada.


Mr. Carter:: I want to ask the Minister of Finance one question. Last night he informed us that no loans had been made to fishermen in Newfoundland by the credit unions. To keep the record straight, would the minister inform the committee how many loans to fishermen have been made by the banks in Newfoundland?


Donald Methuen Fleming: I do not know whether it is relevant, but I will obtain that information and send it to the hon. member.


Mr. Baldwin:: I submit that the position taken by those who support this amendment is completely untenable, apart from the contributions of the hon. member for Rosthern and the hon. member for Marquette, who spoke of the special characteristics which mark institutions of the nature of the caisses populaires and the credit unions.
I think it was agreed on all sides yesterday-and the Associate Minister of National Defence said it again today-that the jurisdiction governing credit unions belongs exclusively to the provincial governments. Yesterday the Minister of Finance made the categorical statement that there had been no requests made by the credit unions or similar organizations to be brought within the ambit of this organization. I think this is most important. I cursorily examined some of the provincial legislation dealing with credit unions and it is my submission, as a result of what I have read, that there is grave doubt, from the provincial statutes which provide for the establishment of credit unions, whether these unions have the authority to participate in legislation of this kind.
There are restrictions which definitely limit
(a)	the type of loans which can be made, and
(b)	the individuals to whom such loans can be extended. I suggest that a consideration of that legislation would indicate very strongly that even if the amendment sought were granted by this committee, the credit unions would not be able to take advantage of this particular legislation.
This is a government which has always had the utmost respect for the rights of the provinces. I think it would be quite wrong, to do as the opposition proposes, to cram down the throats of institutions established under provincial legislation rights, privileges and responsibilities which the provincial legislatures have not seen fit to grant to them. I think this is a tempest in a teapot. If and when the provincial legislatures see fit to make the necessary and consequential amendments to allow the credit unions to

Guarantee of Loans to Small Businesses
make this type of loan, if and when there is a demand from the credit unions to participate, then and then only should we consider the necessity of this particular amendment.


Hazen Robert Argue: I rise again to express support of the amendment before the committee and to take issue with those who would belittle the effectiveness of this provision if it were to pass. A great many members have risen in this debate and set themselves up as experts on credit unions, how credit unions are organized and what they stand for. Last night I listened with great interest to the remarks of the hon. member for Marquette. He told us of some credit unions in the country that are organized on a parish or religious basis and certain credit unions that are organized on a professional basis. He mentioned certain school teacher organizations and credit unions organized among the employees in a packing plant, and so on.
I think by doing this, and only doing this, he has given a very wrong impression of the way in which a great many credit unions in this country are organized. In my own province in the main credit unions are not organized on a professional basis or on a religious basis; they are organized on an open basis, with open membership to anyone who will walk into a credit union and say "I wish to become a member". I think the hon. member for Rosthern will agree that in the main this is the way in which credit unions have been organized out there and are carrying on. Initially many of them were organized with the active support and promotion of local members of various religious orders who felt that in promoting a credit union or a caisse populaire they were doing a real service for their community, but they have not said that credit union membership should be confined to people because of their profession or because of certain other qualifications.
What we are dealing with here is a suggestion that this guarantee be provided to credit unions and to caisses populaires, the majority of which I suggest are operating in such a way that their membership is open to anyone in the community who wishes to join.
The hon. member for Marquette went on, and I quote his words as reported at page 281 of Hansard:
I have yet to hear of small businessmen organizing a credit union of their own for mutual help.
Well, I have not heard of the businessmen we are talking about in this bill doing this, either. I think this is something of a slur on businessmen, because there are a great many businessmen in various communities in
this country who are active members of their local credit union and who with their neighbours have taken a part in promoting and organizing such credit unions. I do not know what particular kind of small businessmen the hon. member for Marquette had in mind; they are not the small businessmen I know, because he went on to say:
They are individualists who cut each others' throats in this competition that they have to carry on in order to make their living.
Well, they may be cutting throats in Marquette; I do not know, but the people I know, whether they are businessmen, farmers, school teachers or members of a religious order, are all equal members of the credit union and are all co-operatively working together to provide credit facilities for their own mutual advantage.
For the life of me I do not know why this government is so opposed to the guarantee being provided to credit unions. They have raised one phony excuse, one straw man after another. One of the phony excuses is that the federal government cannot rigidly regiment credit unions so they could provide the guarantee. I do not think the federal government should be considering this thing they call supervision of credit unions, because credit unions do not need that kind of supervision. The credit unions of this country are well and efficiently operated and, in my judgment, with respect to the measure now before us, they are just as deserving of a guarantee as they were under the Fisheries Improvement Loans Act.
Why the government does not do this very simple thing I have no idea except the one I put forward last night, and that is that the government is interested in promoting the welfare of the banks and is not interested in promoting the welfare of credit unions. When I say that I am not saying that this is not a good measure in so far as it goes, but with the amendment I think it would be a much better measure, and some day it will go this far because this is a sensible, reasonable, proposition.
This government claims that it believes in competition. It does not believe in competition; it believes, as the hon. member for Cartier said, in creating a monopoly of this business for the banks, and that is precisely what the government will do or the direction in which it will go when it restricts the guarantee to banks only. Why not give credit unions an equal opportunity to compete with the banks? Why not allow credit unions to do this kind of business?


Leon David Crestohl: And other lending institutions.
304	HOUSE OF
Guarantee of Loans to Small Businesses


Hazen Robert Argue: My hon. friend says "and other lending institutions". If he wants to bring them in he can name them and I will give consideration to them. I myself am not interested in small loans companies.


Leon David Crestohl: Also trust companies.


Hazen Robert Argue: All right, let us go over them. I do not think I would consider favourably a guarantee to Household Finance, to Beneficial Finance and Niagara Finance and all those loan sharks that have been lending money to businessmen and scalping them because there have not been proper credit facilities available.


Leon David Crestohl: You can limit the charges.


Hazen Robert Argue: Limit the charges? That is what I have been trying to do on other occasions by other means. My hon. friend says if he brings them in he will limit their interest rates. Let us bring them in, limit their interest rates and stop them from fleecing the Canadian people, and give the public a chance to get this credit on a reasonable basis.
Credit unions have done a magnificent job in this country, and they should be given a chance to compete on an equal basis. Last night I said I would be quite prepared to support a guarantee to the credit unions even with a limitation of 6 per cent written into the act. 1 do not think that should be necessary. If the government thinks it is necessary I am willing to support it, even with that in the act. The fact of the matter is that if a credit union does charge 8 per cent-and some charge more than that-the people who borrow from the credit union get more when they pay the 8 per cent than they get from the bank when they pay 6 per cent. Their loan is insured in the event of the borrower's death. Most credit unions follow the practice of paying a dividend to the borrowers as well as to the depositors, so that the person who borrows from a credit union can very often anticipate a dividend, a refund of part of the interest charge that he paid in the first place.
I think that is a good argument for giving a guarantee to the credit unions on the basis of their present interest rates and their present practice. This stipulation of 6 per cent is one that, as I said before, I am prepared to accept. I would be prepared to go that far providing that qualification for a guarantee, if the government were prepared to accept this motion.
I suggest that one way to clear up the question of whether such an amendment would be in the interests of the credit unions is to refer the bill to the banking and commerce committee where expert witnesses representing credit unions, caisses populaires,


banks, businessmen's organizations and so on can be called. Let us find out how much the co-operative movement would appreciate this guarantee.
A royal commission report was made on the question of price spreads in the food industry, and it was recommended that the federal government introduce a national co-operative act. The co-operatives have supported the recommendation made to the government, but the government has done nothing about it. I suggest that the government is closely attached to the banks and is operating hand in glove with them. I suggest that when the guarantee is given to the banks only it is a mistake, that it tends to create a monopoly and to injure the credit unions. It tends to limit the places where a small businessman can get a loan, and I say that the government is doing a disservice to the country by rejecting this amendment.
I hope the amendment will be given widespread support, and I should like to see it carried today. I do not have too much faith in the pliancy of the Minister of Finance, but even he has been known to change his mind. I hope he will take another look at this matter and give the credit unions and caisses populaires exactly the same kind of guarantee that is being given to the banks under this legislation.
(Translation):


Lionel Chevrier: Last night when I moved an amendment to section 2 of the bill now before us, the Minister of Finance (Mr. Fleming) had rather harsh words concerning me. I do not blame him; on the contrary I wish now to congratulate him. The fact is that this afternoon he was helped by the Associate Minister of National Defence who came to his rescue and who not only supported the stand taken by the Minister of Finance but also that of the government.
I wish to congratulate him not so much for his stand on the amendment as for the sympathetic way in which he approached the problem. He has shown courtesy and, contrary to some of his colleagues, he knows that such a quality exists.
The minister said at the outset that we were adopting a federal legislation, that the caisses populaires come under provincial jurisdiction and that consequently parliament could not legislate on such institutions.
Well, such a statement is at least fallacious if not unrealistic. If it is true that the provinces have passed legislation concerning the caisses populaires, it is also true that the federal government has already done the same during the discussion of another legisla-

tion concerning municipalities, which do not come under federal authority but under provincial jurisdiction.
The caisses populaires, Mr. Chairman, are not included in this bill. And yet, not so long ago, in this very house, we included the caisses populaires in the legislation concerning the fishermen, which had already been introduced by the previous government. Why then should we not take pattern on that measure and do the same now?
It is evident that if the government were to decide that the caisses populaires should be included in this bill, an amendment would be necessary. Many arguments have been introduced which speak in favour of the amendment. However I do not intend to protract this debate unduly, but I feel, Mr. Chairman, that the minister should accede to this reasonable request put forward by the opposition and secretly wished for, I am sure, by many members on the government side. Such a measure would help considerably the small retailer.
I therefore submit to you again, Mr. Chairman, the arguments already introduced in support of this amendment.
(Text):
Amendment (Mr. Chevrier) negatived: Yeas, 21; nays, 50.


Mr. Macdonnell:: Mr. Chairman, I want to ask for clarification of the definition of "gross revenue". As set out in the bill the definition reads as follows:
"Gross revenue", as applied to a fiscal period of a business enterprise, means the aggregate of all amounts received in the period or receivable in the period (depending on the method regularly followed in computing the profit from the enterprise) otherwise than as or on account of capital.
I understand that capital in that connection, in the case of a trading company, would not include the cost of an article. In other words, if I buy an article for $100 and sell it for $110, that whole $110 goes into gross revenue and no deduction whatever is made on account of capital. I just want to be sure the definition is quite clear, because I would have thought there was room for argument that part of the sale price is return of capital.


Donald Methuen Fleming: In the case put, if the article that is bought and sold is an article bought and sold in the course of business for ordinary commercial purposes of the company, then no part would be treated as capital.


James MacKerras Macdonnell: That is my understanding of the intention, but is it clear from the wording?


Donald Methuen Fleming: Yes, I think it is.
Guarantee of Loans to Small Businesses


William Arnold Peters: During the recent discussion of paragraph (a) of clause 2, I have been led to believe that hon. members were sympathetic with the views of co-operative enterprises. For that reason I should like to move an amendment to clause 2. I move:
That clause 2 be amended by deleting in paragraph (e), line 11, the words "for gain or profit", and substituting therefor the words "for gain, profit or a co-operative association".
There has been agreement that the co-operative movement has performed a service and has filled a need. Hon. members have spoken in favour of it, so I think this means that there has been an oversight in the wording of this clause which has resulted in the elimination of the co-operative from the definition of a business enterprise. I believe it is generally conceded that co-operatives qualify as business enterprises, except in the respect that they are not necessarily run for gain or profit.
There are many communities, Mr. Chairman, in which the co-operative movement is engaged in the retail business, in manufacturing or the wholesale trade, as well as in service businesses. Over the years, particularly in rural Canada, they have proven to be highly satisfactory business enterprises, but often they have been in need of the opportunity of borrowing money for expansion or for equipment.
I think, in view of the discussion that has taken place, little more needs to be said in connection with the request that the minister support this amendment. It has been generally agreed by the speakers who have participated in this debate that the co-operative movement is deserving of support, and probably it was only an oversight that resulted in the omission of co-operatives from this clause defining "business enterprise".


Donald Methuen Fleming: This is the third day that has been spent in discussion of this measure. We had a discussion that extended over part of two days on the resolution stage. We spent yesterday on this measure, and now we are in what is part of the fourth day. Evidently the hon. member was not here during the earlier stages of the debate. Certainly he is not familiar, judging from his last remarks, with what was said in the earlier stages of the discussion.
On the very first day this question was raised by an hon. member who supports the government, as to whether or not co-operatives are included. I said then, and I made it very clear, that co-operatives are now included within the provisions of the bill. That is the ruling of the Department of Justice which drafted this bill. They are satisfied that co-operatives are now included within

Guarantee of Loans to Small Businesses the benefits of the bill and within the definition contained in clause 2 of the bill. The hon. member, therefore, comes very late into this discussion. He is not aware that this amendment is entirely unnecessary and therefore unacceptable. You do not go on repeating things over and over again in a bill. It is quite clear, as I said much earlier in the discussion, that co-operatives are included in the benefits of the bill.


John Whitney Pickersgill: I should like to ask the minister a question. Can the minister say whether those words are any less necessary in the clause, and if so what particular purpose the minister's legal advisers think they serve?


Donald Methuen Fleming: To which words does the hon. member refer?


John Whitney Pickersgill: The words the amendment is striking out.


Donald Methuen Fleming: The hon. member is not striking out words; he is adding the words, "a co-operative association" in clause 2(c).


John Whitney Pickersgill: I did not have a copy of the amendment.


Donald Methuen Fleming: Therefore the words he is adding are quite unnecessary because co-operatives are included in the benefits of the measure.


John Whitney Pickersgill: If they are unnecessary they are certainly not going to do any harm there; and for greater certainty, as the British North America Act says, there would be a lot to be said for having them there.


Hazen Robert Argue: I think one of the purposes of this amendment, as the hon. member for Bonavista-Twillingate has said, may be for the purpose of greater certainty. So far as I am concerned that is not the most important reason for adding the words "co-operative association" to this clause which now says that "business enterprise" means an enterprise carried on for gain or profit. If no other words are added I think the co-operatives will take exception to this clause, because co-operatives do not admit, and never have admitted, that they are in business for gain or for profit.


John (Jack) Henry Horner: Oh, fiddlesticks.


Hazen Robert Argue: The person who says "fiddlesticks" obviously does not know very much about the principles of the co-operative movement. I was saying that co-operatives do not admit that they are in business for gain or for profit. They say they are in business as a service to their members and in the hope that they can bring about a saving to their members. If people are not well

acquainted with the co-operative movement this may not appear important, but to the members of the co-operative movement these are words that separate the co-operative movement from private businesses that are engaged in retailing, manufacturing, wholesaling and so on.
The co-operatives will not be satisfied with the ruling of the Department of Justice in this instance which results in the elimination of the words they use in the conduct of their business. In years gone by there was a controversy in Canada as to whether co-operatives should be subject to income tax, as to whether co-operatives made a profit. At that time there was a great deal of wrangling and bickering on the definition of these words. I would suggest that by the use of the words in the amendment we would remove any doubt from the minds of the people in the co-operative movement that, in the first instance, they can obtain loans if they make application; and in the second instance, the government is not trying to define by this measure the kind of business and the purposes of the business in which they are engaged. I am certain I am right when I say that the co-operatives would welcome this amendment specifying that they are entitled to a loan when they otherwise qualify under this act and desire that the legislation not state that a co-operative, in order to obtain a loan, must claim that it is conducting a business for a profit.


Jacques Flynn: The Minister of Finance has raised a point of order about this amendment. If nobody wishes to discuss this point of order, I will make a ruling now.


John Whitney Pickersgill: I had not understood the minister to be raising a point of order, Mr. Chairman. I thought the minister had merely said that the amendment was unnecessary. I cannot believe that the minister seriously intended to raise a point of order because surely even the suggestion that there was a point of order about this matter would be a suggestion of abridgement of the rights of private members of parliament, a suggestion which I do not believe any minister of the crown has made in this House of Commons since 1867. The minister has told us that in the view of the law officers, whose view he accepts and endorses here, the co-operative societies are included by this amendment. As to any words that someone seeks to put in for purposes of clarification, surely it is for the house to decide whether they want them and not for the Chair or a minister of the crown. However, I do not think the minister really raised a point of order. I should like to have the point clarified.

Guarantee of Loans to Small Businesses


Donald Methuen Fleming: I will clarify it right now. I am certainly raising a point of order because the amendment, in the form in which it is introduced, is quite unintelligible. Paragraph (c) reads as follows:
(c) "business enterprise" means an enterprise carried on in Canada for gain or profit-
The following words are proposed:
-for gain, profit or a co-operative association-
In other words, "business enterprise" means a business enterprise carried on for-and this is the governing word, namely "for"; and then it goes on-"a co-operative association". That is not what is intended by the amendment at all. The amendment obviously offends the rule with regard to clarity. This amendment does not make sense in the form in which it is introduced. If the hon. member sought to serve the purpose he had in mind the amendment would have to be in different form from this one.


John Whitney Pickersgill: On the point now raised by the minister that he is the arbiter of the grammar of the house may I say this. This is another new principle being imported by this arrogant government-


Some hon. Members:: Oh, oh.


John Whitney Pickersgill: -which seeks to abridge the rules of the house and to tell us that we shall have debates on certain days, whether or not the rules provide for them and which now seeks to say that members may not introduce foolish or incomprehensible amendments. There is no such rule of the House of Commons. It is for the house to decide, not for the Minister of Finance in his superior wisdom, whether an amendment means something or means nothing. The idea that the minister has some kind of superior knowledge that is not given to the hon. member for Timiskaming is, I suggest, a most extraordinary proposition, or the suggestion that the onus should be put upon the Chair of deciding whether amendments are grammatical, comprehensible or even sensible. Surely that is something that the elected representatives of the people should decide and should not be decided by any official or any minister.


Mr. Martineau:: Will the hon. member permit a question?


William Arnold Peters: As mover of the amendment may I say that I have no brief for my wording or for my grammatical ability and I do not want to make any claims for either. I should be quite happy if the minister would stand up and suggest a grammatical amendment which will serve the purpose that I wish to accomplish, namely that we give an interpretation of the co-operative association
which operates, in my opinion, not necessarily for gain or for profit but which operates for the benefit of its own membership in a co-operative manner. If the minister is sincere in making the objection he now makes I would certainly appreciate, as I am sure the committee would, his standing up and suggesting better grammatical language for wording the amendment as long as we maintain that this co-operative society and the benefits it gives are outside the profit and gain motive.


Jacques Flynn: Order. I am sure the hon. member for Bonavista-Twillingate did not in his remarks intimate that it was not the duty of the Chair to have the rules of the house upheld.


John Whitney Pickersgill: No; not at all.


Jacques Flynn: I think it is the responsibility of the chairman to see that amendments which are out of order are declared to be out of order-


John Whitney Pickersgill: Certainly.


Jacques Flynn: -with the help of all hon. members, including the hon. member for Bonavista-Twillingate. On the point raised by the Minister of Finance may I point out that in May's Parliamentary Practice, 16th edition, at page 555, at the bottom of the page, it is stated as follows:
(7) If an amendment would make the clause which it is proposed to amend unintelligible or ungrammatical, or if it is incoherent and inconsistent with the context of the bill, it is out of order.
The way in which I read the amendment is this, and the Minister of Finance drew the attention of the committee to this matter:
"business enterprise" means an enterprise carried on in Canada for gain, profit or a co-operative association-
This would mean an enterprise carried on in Canada for a co-operative association.


John Whitney Pickersgill: Was the word "as" not in the amendment?


Donald Methuen Fleming: No.


Jacques Flynn: No; "for gain, profit or a co-operative association". It would mean an enterprise carried on for a co-operative association. I really do not know what meaning it might have. It seems to me to be ungrammatical. Furthermore, I would think that if it adds something it would really widen the scope of the bill. The intention is to guarantee loans made to small business enterprises. If we add something, it widens the scope of the bill. I therefore rule this amendment to be out of order.
308	HOUSE OF
Guarantee of Loans to Small Businesses


Mr. Browne (Vancouver-Kingsway):: I just want to caution the Chair that in taking too strict a view of unintelligible or ungrammatical amendments we are likely to preclude the opposition from taking part in the debates to come.


Herbert Wilfred Herridge: I have been greatly interested this afternoon. I wish to draw the minister's attention to another defect we see in this legislation. I refer to subclause (b) of clause 2 which reads as follows:
(d) "business improvement loan'' means a loan made by a bank to a proprietor of a small business enterprise for the purpose of financing-
And so on. As we see it, this definition restricts the application of this act to a present proprietor of a business and even that would be extremely difficult to define. I should think a person could get around the terms of the act by establishing a very small interest in some concern and then making application for a loan as a proprietor. However, I wish to bring this matter to the minister's attention. It prevents many young people with ability and with some assets in some cases and with a particular opportunity from taking advantage of this act. I want to give a few illustrations, I usually speak from experience. I can speak with a particular knowledge of my constituency which is somewhat comprehensive in detail as to its natural and human resources.
I know of a young man, for instance, who has some valuable assets in a timber holding. He would like to establish a small saw mill and planing operation. Because he is only able to obtain short term credit from the bank he cannot do that. Under this bill he is not allowed to obtain a loan in order to commence business. If he were able to take advantage of this bill he could build a small saw mill and planing operation as a permanent operation on this timber holding. He is a young man who has ability, capacity and assets in timber.
I know of another young man who has an excellent site for a service station because of the change in a road location, in recent years. This opportunity is due to the fact that considerable traffic passes this particular intersection. At the present time he is not established in business. He has this asset, and if a new business could be established under this bill here is a young man with assets and some ability and energy who could take advantage of the bill.
Then I know of one or two other cases of young men who own excellent sites for auto camps, tourist resorts and tourist camps, who are not in business because of lack of capital. They have these sites and they have beach locations close to good fishing, and so on. These young men have the ability,
[The Chairman.]

capacity and energy required to make a success of such small undertakings. As the bill stands at present, it appears to me they would not have the opportunity of borrowing money to establish a business of this type.
I know of another case of a young man who has an excellent wharfage site and is a good boat builder. He has the site, he has the natural resources, shall I say, in a small bay facing a beach, and so on, close to an area where, particularly in the summer months, tourists visit in numbers. He has this quite good site, but he does not have any capital. As I read the bill at present, he would not be able to borrow money for the establishment of a new business.
I give those illustrations from my personal experience, Mr. Chairman, and I am sure there must be many other illustrations of a similar type that hon. members of this house could give from their personal experience.
I do not wish to unduly take up the time of the house, but I wish to correct what we think is a deficiency in the bill in this respect. I wish to move an amendment, and I trust it is grammatical and will meet the linguistic exactitude of the minister. I move:
That paragraph (d) of clause 2 be amended by adding, immediately after subparagraph (iii), the following:
"(iv) the purchase or construction of a business enterprise;"


Donald Methuen Fleming: Mr. Chairman, the amendment does propose an extension of the provisions of the bill; it does propose an enlargement of what is the scope and indeed the principle of the bill. To that extent it lays a charge upon the crown, and in my submission is out of order when introduced by a private member.


John Whitney Pickersgill: Mr. Chairman, in reply I would just like to say that the charge upon the crown is limited to whatever the loss may be on total loans of $250 million. Whether that money is loaned to B or C, as long as he is a small businessman-which is the principle of the bill-it seems to me to not in any way increase the charge against the crown.


Donald Methuen Fleming: Mr. Chairman, the hon. member for Bonavista-Twillingate has got himself mixed up again. He was talking about there being a limit of $250 million. Mr. Chairman, the limit-as you will find in clause 6-is $300 million-


John Whitney Pickersgill: Yes, I admit that.


Donald Methuen Fleming: -in a particular period. That limit may or may not be reached in the particular period. The hon. member is quite beside the point in talking about this

limit. The fact is that the moment this legislation comes into operation the amendment would add to the charges upon the crown, because this limit may or may not be reached. It certainly will not be reached in the first year; that is quite evident. In the meantime the amendment would have added to the charges upon the crown. Therefore I think it is quite clear that this amendment is out of order. It is not the kind of amendment that can be introduced by a private member of this house.


Jacques Flynn: I do not think I have much difficulty in upholding the view of the minister. It seems to me that the purpose of the bill is clearly set out in the explanatory note at the beginning. Furthermore, I would say that if we considered the amendment from another aspect it would widen the scope of the bill. Therefore, for those two reasons, I rule this amendment out of order.


Herbert Wilfred Herridge: Mr. Chairman, we agree with the view advanced by the hon. member for Bonavista-Twillingate, that this does not increase the total financial responsibility of the government. Therefore I appeal your ruling.
Mr. Speaker resumed the Chair, and the chairman of the committee made the following report:
In the committee of the whole when Bill No. C-40, respecting loans to proprietors of small business enterprises for the improvement and modernization of equipment and premises was being considered, Mr. Herridge moved an amendment as follows:
"That paragraph (d) of clause 2 be amended by adding, immediately after subparagraph (iii), the following:
'(iv) the purchase or construction of a business enterprise;' "
I ruled the amendment out of order on the ground that it involved an expenditure which could not be proposed by a private member; and, moreover, it went beyond the scope of the bill. Whereupon Mr. Herridge appealed to the house from the ruling of the Chair.
Mr. Speaker put the question as follows:
The question before the house is an appeal to the house from a decision of the chairman of the committee of the whole as follows:
In committee of the whole when Bill No. C-40, respecting loans to proprietors of small business enterprises for the improvement and modernization of equipment and premises was being considered, Mr. Herridge moved an amendment as follows:
"That paragraph (d) of clause 2 be amended by adding, immediately after subparagraph (iii), the following:
'(iv) the purchase or construction of a business enterprise;' ''
The chairman ruled the amendment out of order on the ground that it involved an expenditure which could not be proposed by a private member; and, moreover, it went beyond the scope of the bill. Whereupon Mr. Herridge appealed to the house from the ruling of the Chair.
Division


Mr. Speaker:: I declare the chairman's ruling confirmed.


John George Diefenbaker: Mr. Speaker, with leave of the house I should like to revert to motions before the house continues in committee.


Mr. Speaker:: Has the Prime Minister leave to revert to motions?


Some hon. Members:: Agreed.



LABOUR CONDITIONS


John George Diefenbaker: Mr. Speaker, I thought it only proper that I should make an immediate report to the house on the progress of the discussions that have been taking place during the past two days between the representatives of the unions and the representatives of the railway companies. Every avenue of approach to bring about a settlement has failed. I had hoped that through face to face talks a basis for agreement might be arrived at. I regret to say that the discussions ended in a stalemate and there is no possibility of any agreement.
My colleagues and I endeavoured to bring about a settlement by providing the opportunity for face to face discussions and suggested, as an alternative, the postponement of the strike to May 15 with the definite undertaking that there would be no prejudice to the rights of the unions or the employers to


proceed then in the normal way of negotiation. May 15 was fixed as the date for, by then, the MacPherson commission will have reported and will, within the terms of its powers, report on the means whereby freight rates may be equalized in various parts of Canada as far as equalization is possible. In the meantime the freeze on freight rates remains.
Mr. Gordon made an offer which was rejected by the unions. Mr. Hall took the stand that the unions would accept nothing less than the implementation of the conciliation report. This the railroads refused to accept. Following the decision of both sides, I expressed regret that no agreement had been arrived at and stated that the government would recommend to parliament at the earliest possible time legislation which, if passed by parliament, will prevent a strike taking place and will postpone further action in this dispute until May 15 without prejudice in any way to the rights of the parties.
I wish to add that the spirit in which the discussions took place was an admirable one and that Mr. Hall stated that, if parliament so declared, a strike would not take place, the law would be followed by the unions. When I spoke yesterday in the house I mentioned that railway men are law abiding and that was underlined again by Mr. Hall's statement in that regard.
I hope that the opposition will be prepared to allow a bill to be introduced tomorrow afternoon so that we may proceed at once with a discussion of this matter. It will be impossible, of course, because of the lateness of the hour, to have the bill available in printed form tonight. When I mention the lateness of the hour I do so because it was impossible to have a bill prepared and printed as long as negotiations were continuing. I think a similar course was followed on a previous occasion.
I would ask whether the Leader of the Opposition (Mr. Pearson) and the leader of the other party in the house would agree that we should proceed tomorrow with this bill and whether it will be acceptable if the bill is in typewritten or mimeographed form tonight in view of the necessity of coming to grips with this matter at once.
I am sorry to have to make this report. I had hoped it would have been possible to achieve a measure of agreement but that has proven to be a fruitless hope and now, so that the economy of the nation may be maintained and assured, parliament is going to be asked to act.


Lester Bowles Pearson: Mr. Speaker, we on this side share the Prime Minister's regret, a regret

that I am sure is felt by every hon. member of the house, that in spite of the strenuous efforts that have been made in accordance with the best democratic practice it has not been possible to reach an agreement on this important matter. The Prime Minister (Mr. Diefenbaker) has announced that legislation will now be introduced to deal with this question. It goes without saying, as he has mentioned, that whatever legislation is passed by the house will be respected and obeyed by trade union members and anyone else who is covered by it. I think we can all count upon that.
We will do everything that we can on this side to facilitate and expedite consideration of this legislation. We will be happy to collaborate with the Prime Minister in considering it tomorrow. We appreciate that it is not possible to have the legislation printed until tomorrow. It would be of great assistance to us to have copies in some form this evening and the Prime Minister has indicated that that could be done.
Without saying anything further, and of course without committing ourselves in any way on the stand to be taken in regard to the legislation, we will do our best to facilitate parliamentary discussion of it.


Hazen Robert Argue: Mr. Speaker, it is indeed regrettable that the negotiations that have taken place have now broken down with the result that this is the course upon which the government is determined to embark. I feel that the employees are not only law-abiding citizens at all times, as everyone recognizes, but I am certain they will obey the laws of this country. They have been in a very strong position in all of these negotiations. They have had in their support the fact that they have accepted the majority conciliation board report. I think it is greatly to be regretted that an agreement has not been obtained on the basis of that report.
I want to say that it is my judgment the railways have been callous in their attitude. They were quite prepared to see a railway strike. As a matter of fact, there is evidence that the railways have been laying off workers across this country at a greater rate than would be necessary if they were dealing only with a falling off in traffic. I say, therefore, that the railways must accept the chief responsibility for the fact that negotiations have broken down.
Then I suggest that the Prime Minister (Mr. Diefenbaker), in asking the house to support a measure which merely postpones the evil day until May 15, is not presenting a proposal to solve the difficult situation. He is merely postponing it by saying, let us postpone it to May 15 so we do not have to
Threatened Rail Strike deal with it today. I feel that the introduction of the royal commission as an argument in the issue is wrong. I do not believe it should have been introduced. I believe the government has raised this merely as an alibi to avoid its responsibility at this time.


An hon. Member:: Utter nonsense.


Mr. Speaker:: The hon. member will have an opportunity to debate the matter. At the present time, all that is in order is preliminary comment on the situation that has been announced.


Hazen Robert Argue: I think the government itself, in these negotiations, has failed in its responsibility by not suggesting other alternative procedures that I believe would have resulted in a settlement. As a last resort the government should have been prepared to grant a subsidy of the amount referred to in the discussion yesterday. No one wants a strike. A strike will do great damage to our economy. But I suggest to the Prime Minister that legislation which requires the workers to maintain operation of the railways in this country is legislation that is repugnant to Canadians and should not have been necessary at this time when other action might have been taken.


John George Diefenbaker: This statement goes beyond what I think is fair comment. I just want to say that we shall meet the hon. gentleman tomorrow, if he consents to the discussion taking place at that time, and we shall then ascertain the degree to which labour and the farmer can be brought together in an alliance.


Hazen Robert Argue: Stir up disunity.


Mr. Speaker:: Would the hon. member for Assiniboia (Mr. Argue) care to make any statement with respect to the request that the legislation be introduced and discussion facilitated tomorrow?


Hazen Robert Argue: My understanding of the rules is that the government has the right, and it is normal procedure, to present a bill for first reading. At that time, if a request is made for second reading of the bill and the debate to take place we will give that request consideration and reply at that time.


Mr. Speaker:: I am not sure whether the suggestion is that an order be made at this time because, as I understand it, the bill could not be read the first time without unanimous consent. If the house would authorize such consent-does the Minister of Justice wish to speak?


Hon. E. D. Fulton (Minister of Justice):: You
have made the point, sir, that I was about to make. Normally there has to be 48 hours'
312	HOUSE OF
Financial Administration Act notice given in Votes and Proceedings before a bill can be introduced in the house. It is that notice that the Prime Minister (Mr. Diefenbaker) had in mind asking the house to waive so the bill could be introduced tomorrow.


Lester Bowles Pearson: May I say a word on a question of privilege? I would have had a good deal to say about what should or should not have been done in connection with this matter if I had not considered myself out of order at this time in trying to do so.
On the question of procedure, we would be glad to expedite matters and give first reading this evening at ten o'clock. Then we could go ahead tomorrow with the second reading.


Mr. Speaker:: Then perhaps, proceeding one stage at a time, I might ask if the house will give unanimous consent to the first reading tomorrow?


Some hon. Members:: No, ten o'clock tonight.


Mr. Speaker:: Is the Prime Minister proposing that first reading be tonight?


John George Diefenbaker: That would be all right.


Mr. Speaker:: Does the house give unanimous consent to first reading tonight, notwithstanding the rules?


Some hon. Members:: Agreed.


Mr. Speaker:: It being five o'clock, the house will now proceed to the consideration of private and public bills.



FINANCIAL ADMINISTRATION ACT


Mr. Samuel Boulanger (Drummond-Arlha-baska) moved: the second reading of Bill No. C-6, to amend the Financial Administration Act. He said:
(Translation):


Samuel Boulanger: Mr. Speaker, it is the third time that I have the honour of introducing this bill the purpose of which is to provide that every cheque, draft, traveller's cheque, bill of exchange, postal note, money order, postal remittance and any other similar remittance of any department as defined in paragraph (f) of section 2 of the Financial Administration Act or of any crown corporation enumerated in schedules B, C and D of the same act, shall be printed in both the English and the French languages.
I do not wish to bring up again the arguments I put forth in support of my motion


during the debates that took place in 1958 and 1959. I merely wish to bring forward a few statements made by prominent Canadians about the advantages of bilingualism in Canada. As reported in the June 1960 issue of the Imperial Oil Review, Mr. Hugh MacLennan, a distinguished Canadian writer, stated the following:
For a long time, Canadians of the two main ethnic groups have been looking forward to the day when happy relations will he established between English speaking and French speaking citizens. Is it not the first requirement of a true nation from the spiritual and the economic point of view? Let each group succeed in learning the language of the other, and we shall have accomplished good progress toward that ideal. The problem is big enough but not insuperable.
I also wish to report another testimony of a distinguished Canadian, the Speaker of the house, who stated at the Alliance Nationale conference held in Ottawa:
. . . mutual understanding between English speaking and French speaking Canadians would be much easier if everybody were bilingual.
Everyone must try to identify himself with both groups.
I could quote many other testimonies, but I shall leave off at this point so that we may pass this measure as soon as possible. I feel that any speech tending to extend the debate would indicate that government members who introduced the same legislation cannot count on the co-operation of their colleagues for the passage of their own bill.


Mr. L. J. Pigeon (Jolieiie-L'Assompiion-Montcalm):: Mr. Speaker, I had not intended to take part in this debate, but I have a few remarks to make in reply to the reference just made by the hon. member for Drummond-Arthabaska (Mr. Boulanger).
Last year, when I brought down my bill, the hon. member for Drummond-Arthabaska offered a few comments, and I do not see that it did any harm to the bill.
I have been putting the same motion on the order paper for three years, and this is the first time, to my knowledge, that a member sitting on the government side has moved such a bill, for it is much easier for members of the opposition to have bills placed on the order paper than it is for members on the government side.
I thought it was my duty to say a few words to strongly encourage the house to pass this bill as soon as possible.
It is more than ever advisable that the parliament of Canada recognize official bilingualism in Canada by statute on the grounds of our dearest traditions, as confirmed by the B.N.A. Act and many constitutional statutes.
The purpose of this bill is to have printed in both French and English, cheques, drafts,

travellers' cheques and other instruments issued by a department of Her Majesty's government. This is no revolutionary change that could endanger the nation's balance or the government's stability.
This is merely an administrative arrangement designed on the one hand to do justice to all Canadians and, on the other hand, to ensure recognition of certain conditions, the existence of which has long been admitted by our people.
Before concluding my remarks, I also take this opportunity to ask that the government try to remedy a situation which has always existed, especially under the former administration, and to ensure that all signs and markings appearing on public buildings in Canada and abroad are bilingual.
I ask the house to adopt this bill.
(Text):


Mr. John Pratl (Jacques Carlier-Lasalle):: This perennial question of bilingualism has arisen again this year and I rise again to speak in support of it. I spoke in favour of it last year at which time I supported the principle of bilingualism on cheques and other documents. My point is this. If it may make many people happy to have such bilingualism and if it makes very few if any unhappy to have it, then why not have it?
As an English speaking member I see no reason to object to the use of bilingual cheques and other documents in this country. We already have bilingual stamps. We also already have bilingual currency. In this house we have installed a bilingual system of simultaneous translation. Apparently no one has suffered from these innovations. Why be afraid of bilingual cheques and other documents? I believe sincerely that the existing friendly relations between the French speaking citizens and the English speaking citizens of this country would be improved even more if we granted this simple request.
Most Canadians across this country by now are quite accustomed to seeing bilingual stamps and bilingual currency. After the first stage of novelty wore off a few days after the introduction of such documents I am sure they would be almost subconsciously accepted as a matter of course.
Our French speaking fellow citizens, however, would be highly gratified and highly pleased at this recognition of the essential basic facts of the agreement of confederation. Unfortunately there still exists in some quarters, both French and English, a groundless fear of granting any increased recognition to each other's native tongue. I am sure there would be much less objection from either side if a secondary language on public stamps and currency happened to be, for instance, Latin
Financial Administration Act or Greek. At the present stage of progress in this country this secondary language would probably be accepted quietly as cultural or intellectual gentility.
In my own riding of Jacques Cartier-Lasalle I am happy and proud to say that everything is bilingual. We now have in that riding a population which is about 70 per cent English speaking and 30 per cent French speaking, as far as I can say until the next census is taken. Our newspapers, street signs and so on are all bilingual. The children playing together in the street or in the parks or playgrounds are bilingual. We accept these things in Jacques Cartier-Lasalle without second thought, as a matter of course, as a matter of plain, ordinary, everyday living.
There is one point which I have mentioned previously and which I should like to stress once again. When documents are bilingual I fully believe they should be written in good French and in good English and not just in a poor literal translation of either. To my mind a poor translation is even more of an insult than one could consider any innocent omission of either language to be. Any English speaking person who may feel strange when he is first faced with the preponderance of the French language in Quebec should try to put himself or herself in the place of our French speaking fellow citizens who never see their native language in other parts of this country.
I most sincerely hope that some day everyone in Canada will understand and speak both languages so that we may better understand each other and each other's aspirations. I therefore fully support the principle of this bill.
(Translation):


Mr. Dupuis:: Mr. Speaker, as regards the printing of cheques in both English and French, I can say that the majority of the people are in favour of it-
(Text):


Mr. Speaker:: Order.
(Translation):


Mr. Heward Graffiey (Brome-Missisquoi):: Mr. Speaker, as member for Brome-Missisquoi, my opinion is that we must support this important bill. At the same time, Mr. Speaker, I am asking myself a question. Since we are discussing a bill, why do we not simply proceed by way of an administrative measure?
Here in Canada we have two official languages. Our paper money is bilingual. Why then should not our cheques also be bilingual?
Under the circumstances, would it not be simpler to make use of the administrative machinery?

Financial Administration Act
(Text):
Mr. Speaker, we in the province of Quebec realize only too well that while two languages are officially recognized in this country, in many sections of our land outside the province of Quebec perhaps only English is spoken and very little, if any, French. But at the same time I am convinced that citizens in districts outside the province of Quebec would be more than happy to have bilingual cheques printed, just as money is printed in the two official languages of this country.
I am equally sure that citizens in sections of my province where only the French language is spoken would be only too happy to have the cheques that we are discussing at the present time printed in both languages, just as our money is printed in both languages at the moment.
I am told, as a freshman member of this House of Commons, that by rising in my place in this house at the present time I am doing what is commonly called "killing a bill". Let me say this in front of my constituents, in front of my fellow Canadians and in front of all members of this house. (Translation):
As representative of Brome-Missisquoi, I support the principle of this bill.


Hédard-J. Robichaud: Question.
(Text):


William Heward Grafftey: Mr. Speaker, again I hear noises from the opposition benches. Let us now oast all facades aside; let us get right down to the point we are discussing.


An hon. Member:: Yes, let us get to the point.


William Heward Grafftey: It is good to hear the hon. member for St. Jean-Iberville-Napierville (Mr. Dupuis) speak in the house this afternoon. It is one of those rare occasions on which he visits the house. He must have been working hard in his riding.


Yvon Dupuis: Yes, I was winning the election at Chambly.


William Heward Grafftey: That is very interesting and it is good to see the hon. member back. I understand he was participating in the provincial election.


Some hon. Members:: Order.


William Heward Grafftey: Most people might perhaps think that on the face of it we are just discussing a very simple matter of bilingual cheques and whether or not we should print cheques in the two official languages of this country. I have said time and time again, and I repeat it in this House of Commons- as I did in the French language-that I do not see why a simple administrative act cannot be passed almost at any time in order

to achieve the ends contemplated by this legislation. I am not shy at this time in pressing upon the government the desires which I have just stated.
Only the other day a very good friend of mine, Mr. Arthur Blakely of the Montreal Gazette, talked about how various parties in this country, whether they are in power or in opposition, claim to be the champions of that which we might refer to as national unity. He made certain remarks in his column, which I am sure most hon. members have read. I agree largely with many of the remarks which Mr. Blakely made, Mr. Speaker.
I remember years ago, when I was taking French lessons in order to become bilingual, saying to my French speaking professor, something that pertained to the spirit of national unity. Her reply was this, that all people of Canada, both inside and outside the province of Quebec, took national unity for granted.
Why do men in public life and politicians always whip this horse, so to speak? I venture to say that all members of parliament- and I have to add a rider, with the exception of a very few-take that which we call national unity for granted. But I say that unfortunately there are a few who persist, whether or not it is on the discussion of this bill, in divide and rule tactics. There are a few who, on the one hand, offer to the people of Canada, centralization and uniform legislation, while on the other hand they try to divide and rule our country. I will not be irresponsible and label any one political party with this accusation.
(Translation):
But I ask myself a question. Let us look, for instance, at the speeches of the hon. member for Laurier (Mr. Chevrier). Could he-and I have the feeling he would like very much to become leader of the Liberal party, but I am not too sure about it-could the hon. member deliver in every part of our great and young Canada the speeches he made in the county of Labelle? I would say no. Could he table here in the house the speeches he made in the county of Labelle, province of Quebec? I would say no, Mr. Speaker.
Throughout my district of Brome-Missisquoi, I am always Grafftey; I am not Martin in the province of Quebec and Martin in the province of Ontario.
Our name is the same, and the principles we advocate are the same in all parts of our country, Canada.
(Text):


Some hon. Members:: Do not talk it out.


William Heward Grafftey: Mr. Speaker, I have no intention of talking this bill out. I am here to support the principle of the bill. I am not here to label any one party with being against national unity; I am not here to say that one party stands for national unity any more than another. I am here to ask certain members of parliament from certain provinces to stop going about this country and trying, for example, to label our party as being against the interests of certain provinces. The reason behind it is no doubt for short term political advantage; but it is not good for our country at large.
I say that one of the greatest paradoxes- and again I repeat what I said in the French language-is that certain members of parliament have supported centralizing legislation, with its uniform effects, in this country while at the same time they preach what is, as far as I am concerned, a divide and rule doctrine. Let us all agree, once and for all, that we support the principle and the sentiments behind this legislation.
I resume my seat at this time, Mr. Speaker. I support this bill. I am sure the hon. member for St. Jean-Iberville-Napierville (Mr. Dupuis) would like to tell his fellow citizens and mine that I helped talk out this bill; but I am not doing that.
(Translation):
I support this bill which is so important, Mr. Speaker.
(Text):


Hazen Robert Argue: Mr. Speaker, I want to congratulate the hon. member who has just introduced this bill for bringing it before parliament once again. I think it is a sensible measure; I think it deserves the support of hon. members of this house.
I had an opportunity on at least one former occasion to vote for a similar bill, and I am prepared to vote for this bill today. The principle of the bill is merely to recognize in these particular federal negotiable instruments, the bilingual nature of our country.
I think this is a good bill. I think it is a sensible bill. I hope a vote may be taken before six o'clock.


Mr.  M. D. Morion@Davenport: I can understand the impatience of some of those who are sponsoring this bill. Although we have agreed on the principle of the measure, which the house acknowledged in January of 1958-the house accepting in principle the extension of bilingualism at that time-I would point out that the enthusiasm, and impatience perhaps, of those who are pressing this principle does not necessarily hasten the completion of the purpose of this measure.
As has been pointed out by previous speakers, although this principle may be acceptable
Financial Administration Act to most of the leaders in this country it is not necessarily acceptable to all the people of this country, and it might not be well, through impatience and enthusiasm, to force the issue and thus set back the object which many hon. members have in mind. I think more can be done through continuous education than by arbitrary legislation. There are places in this country which possibly have not accepted bilingualism, though I feel that the principle has won much greater acceptance in the last few years.
I recall attending a conference of the Canadian education association at Quebec city a few years ago at which bilingualism was discussed, and it was pointed out at that conference that in the province of Quebec an extended program was being arranged whereby the English language would be taught in most areas of Quebec as teachers could be found. It was also pointed out that a similar program was being instituted in Ontario. I feel that true bilingualism will be brought about as a result of programs of this type.
There is, in fact, no urgency about the question of whether cheques are printed in the two languages. It is, as has been stated, an extension of the principle of bilingual currency. It is also an extension of the principle contained in section 133 of the British North America Act where the right to use both languages in parliament and in our courts is laid down. I plead with those who are anxious to go further to take into consideration the views of those who have not, perhaps, fully accepted their opinions; I appeal to them to continue to exercise the opportunities available to them in debate and public discussion.
I believe that in the past, because of petty politics, prejudice has been caused which has done harm to the acceptance of bilingualism. The radical nationalists or racialists on each side have tried to whip up a fury against their opposite numbers by trying to call attention to the extension of the influence of the other. Throughout our history they have, I think, done a great disservice to this country by continuing to force their prejudices upon the people as a whole.
I recall discussing this problem during the war with my colleagues from Quebec. We discussed very frankly the problems which have arisen in the past between English speaking people and French speaking people. I was born in New Brunswick and I have been in contact a great deal with the Acadian French. We always got along very well. A very true comment came out of the discussion as far as Quebec is concerned, and I think it applies to other parts of the country as well-that had the people been left alone to
316	HOUSE OF
Guarantee of Loans to Small Businesses follow their own wisdom and their own desires there would have been no trouble.
A great deal of the prejudice and difficulty has arisen because of politicians who have used those prejudices for their own ends. That is the legacy we have inherited and that, I think, is one of the reasons we have not been able to advance as far as some hon. members opposite would, perhaps, wish. Their enthusiasm should not be dampened, because throughout history great causes have not been won by impatience or by imprudently forcing one's wishes upon others. Rather, they have been won by education and tolerance and, in this case, showing that true bilingualism is a matter of real co-operation by everyone in the country.
I think we have also to consider that in Canada we have people of various origins reaching our shores each year, and this same co-operation must extend to them in order that we may model a new and true Canadian culture which takes in as part of its background the culture and philosophy of all these various races. If we are going to be a truly great nation, as I know we shall be, it will only be through the understanding and tolerance of each and every group within our country. We cannot build a country by forcing our own views upon other groups. We must be willing to give and take. We must be willing to build a new Canada on a common culture and common ideals. We can achieve this advance only through unity and not through disunity. So I plead with those who are enthusiastic not to be too impatient and not to harm their case by being too impatient in this matter.


Yvon Dupuis: You have killed the bill, it is six o'clock.


Mr. Morton:: It is not a matter of killing the bill. It is a matter of approaching this measure in a reasonable way, and hon. members should not be as impatient as they are.


Mr. Speaker:: It being six o'clock, the house will revert to the business which was interrupted by the consideration of private and public bills.



FINANCE


[Stage Direction]
The house resumed consideration in committee of Bill No. C-40, respecting loans to proprietors of small business enterprises for the improvement and modernization of equipment and premises-Mr. Fleming (Eglinton) -Mr. Flynn in the chair.
Jacques Flynn: Since the house has confirmed the decision of the Chair regarding


the amendment proposed by the hon. member for Kootenay West, the committee will resume consideration of clause 2 of Bill No. C-40.
On clause 2-Definitions.
At six o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 8 p.m.
Jacques Flynn: Order.


Mr. Starr:: Mr. Chairman, with the consent of the committee, I would ask permission to interrupt the proceedings at this time to permit the introduction and first reading of a bill, as unanimously agreed earlier this day.


Donald Methuen Fleming: I move that the committee rise, report progress and ask leave to sit later this day.


Jacques Flynn: Is it agreed that the committee rise, report progress and ask leave to sit later this day?


Some hon. Members:: Agreed.
Progress reported.



MAINTENANCE OF RAILWAY OPERATION ACT


Michael Starr: for leave to introduce Bill No. C-45, to provide for the continuation of the operation of the railways.
Motion agreed to and bill read the first time.



FINANCE


[Stage Direction]
The house resumed consideration, in committee, of Bill No. C-40, respecting loans to proprietors of small business enterprises for the improvement and modernization of the equipment and premises-Mr. Fleming (Eglinton)-Mr. Flynn in the chair.
On clause 2-Definitions.
Jacques Flynn: Shall clause 2 carry? (Translation):


Mr. Bourgei:: Mr. Chairman, with a view to extending the scope of the present legislation by including therein the caisses populaires and credit unions;
With a view to facilitating the granting of loans mentioned in this bill;

With a view to sparing inconvenience to prospective borrowers, especially those who live in communities where there are no chartered banks;
With a view to enabling thousands of Canadians who have deposited their savings in caisses populaires or credit unions to make those savings available to small businessmen; (Text):
I should like to move:
That clause 2 (a) be amended by adding after the word "applies" in line 6, the following:
"as well as co-operative lending institutions such as credit unions, caisses populaires, and others, recognized by the minister as qualified loan institutions."


Donald Methuen Fleming: I submit that this amendment is quite out of order. Even in form it is almost exactly the same amendment as was introduced last night and defeated on a vote this afternoon. So far as the substance is concerned, it is clearly the same amendment as was introduced last night at page 276 of Hansard and defeated this afternoon. I think the house has already declared itself on this subject.


Maurice Bourget: Mr. Chairman, the amendment introduced last night by the hon. member for Laurier intended to add something to the definition by adding the word "lender". By this amendment we are trying to extend the definition on the word "loan" not only to banks which come under the Bank Act, but also to allow caisses populaires and the credit unions to come within the scope of the bill.


Leon David Crestohl: I should like to support what the hon. member has just said. The amendment introduced last night, as he said, added a new definition, namely that of lender because in the subclauses of clause 2 there is no definition of lender. Last night the hon. member for Laurier attempted to give a definition of lender and that was rejected. This amendment is on an entirely different ground and proposes to do something else. It proposes to define the word "bank" as we have it in clause 2 and extend it beyond what is now contained in the definition of the word "bank". The amendment intends to cover other lending institutions.
I should like to add this argument. If banks alone are to be the only ones qualified to make those loans the interest rate will be frozen at that which the Bank Act provides. But if we allow competition in this business- take trust companies-


Donald Methuen Fleming: This is not on the
point of order.
Guarantee of Loans to Small Businesses


Jacques Flynn: For the time being I hope the hon. member will restrict his remarks to the amendment. That is the only point under discussion.


Leon David Crestohl: Yes, Mr. Chairman. I am simply illustrating why I think the amendment is in order. This amendment proposes to give an added definition to the word "bank". If it is adopted it will also allow trust companies, for example, to make loans and if trust companies are allowed to make loans- and they have an accumulation of funds- and other lending institutions which might be prepared to make those loans to small businesses they might do so at a lower rate of interest than the banks are allowed to charge by the statute. That is why I think the amendment is strictly in order. It gives further scope to the definition of the word "bank".


Jacques Flynn: Really the amendment
which the hon. member for Levis seeks to move is the amendment moved by the hon. member for Laurier, which was negatived this afternoon. I can see only a technical difference. Substantially it is the same, and whatever argument may be put forward to emphasize any difference I can only come to the conclusion that the amendment is a repetition of an amendment upon which the committee has already made a decision. I would refer hon. members to citation 194 of Beauchesne, fourth edition, which reads in part as follows:
A motion or amendment cannot be brought forward which is the same in substance as a question which has already been decided, because a proposition being once submitted and carried in the affirmative or negative cannot be questioned again but must stand as the judgment of the house.
To me it does not make any difference whether an attempt is made to include credit unions or caisses populaires by way of amending subparagraph (a) or by way of adding a subparagraph (n) to clause 2, and therefore I rule this amendment out of order.


Mr. Howard:: I wonder whether I might make a suggestion with respect to subparagraph (c), the definition of what is a business enterprise. Since the discussion this afternoon we have had an opportunity to consult with grammarians and draft an amendment that will at least sound nice to the Minister of Finance so far as grammatical form is concerned although whether its substance will be acceptable is another matter. Even though the Minister of Finance has indicated that the Department of Justice has told him that co-operative associations are in fact included within the content of the bill and within the definition of a business enterprise, nevertheless we all realize that the
318	HOUSE OF
Guarantee of Loans to Small Businesses opinions of the Department of Justice are not always upheld when they are interpreted by the courts, which have the final say in deciding exactly what a statute means. We have come across this situation a number of times. The Department of Justice expresses an opinion and it is found later that the department was in error.
In order to make it quite clear that cooperative associations can function as business enterprises under this legislation, I think we should include words to that effect in the bill regardless of what the minister says the Department of Justice has told him. I am afraid I only have one copy of the amendment which I should like to move but I will read it slowly so hon. members can follow it. I move:
That subparagraph (c) of clause 2 be amended in line 11 by adding a comma after the word "profit" and by inserting between the words "profit" and "where" the following:
"and includes a co-operative association,''.
Subparagraph (c) would then read as follows:
"Business enterprise" means an enterprise carried on in Canada for gain or profit, and includes a co-operative association, where the principal business carried on therein comes within any of the following classes of businesses-
I do not think too much argument is needed in favour of including this in the bill. The Minister of Finance agrees that it should be included in the bill and says that he has been told by the Department of Justice that it is included in the bill. Yet we all know that the Department of Justice is not infallible and has been found to be wrong in the past. Certainly the amendment will clarify the clause and ensure the inclusion of co-operative associations, in which we all believe and which we try to promote. I think the Minister of Finance will see the merits of this particular amendment.


Donald Methuen Fleming: I see no merit in the proposal. It is perfectly clear that it is redundant. The bill in its terms is quite clear in this respect. The statement that I made to the house on the resolution stage and repeated this afternoon makes it abundantly clear that co-operatives are included within the benefits of the measure. That opinion is not based simply on my interpretation of the language of the bill; it rests upon the interpretation of the Department of Justice. If my hon. friend will permit me, in this regard I prefer the opinion of the Department of Justice to the opinion and the doubts he has expressed. The opinion of the Department of Justice has left no doubt in this matter and therefore the amendment is clearly redundant.


Leon David Crestohl: I should like to ask the
minister a question. I was not clear whether


the opinion of the Department of Justice means that credit unions are permitted to be lenders or simply that they can benefit under the act.


Donald Methuen Fleming: We are speaking of co-operatives and what I said was that they are included within the benefits of the measure. In other words, they qualify as a business enterprise under clause 2(c).
Amendment (Mr. Howard) negatived: Yeas, 22; nays, 75.


Leon David Crestohl: Mr. Chairman, I am anxious that we eliminate any possible interpretation to the effect that this measure gives a monopoly of some kind to banks only, and therefore I wish to move:
Add to subsection (2) of clause 2 the following:
"and to all other institutions such as trust companies, insurance companies, loan companies and all other companies authorized by government charter to lend money, all of which shall first be approved by the Minister of Finance."


Donald Methuen Fleming: Mr. Chairman, I should like to submit that this amendment is clearly out of order. It may not cover all of the ground that was covered in the earlier amendment of the hon. member for Levis to clause 2(a), line 6, which was negatived a few minutes ago but it certainly covers some of the ground. Indeed, the words of the hon. member cover again in part the language that he himself used in voicing his support of the amendment of the hon. member for Levis.
There is another ground, of course, Mr. Chairman, that will be obvious and that is that this . would have the effect of enlarging the charge upon the crown. On these, and I think other grounds as well, Mr. Chairman, I believe it is obvious that this amendment is clearly out of order.


Leon David Crestohl: I respectfully differ with the minister's opinion that it would add to the obligations of the government. These are loans which would be made to small businesses, and that is the purpose of the bill to make loans available to small businesses. The provision that the banks only shall have the privilege and the right to make these loans is a restriction of the intention of this bill. I respectfully submit that I, by my amendment, have added trust companies, loan companies and other institutions which are authorized by charter to lend money. I emphasize that, Mr. Chairman. Certainly the banks are in no better position than private organizations which are authorized by charter to lend money. Why, when some powers are given to one Canadian organization or one Canadian company, they should be denied to other companies having the same authority

Guarantee of Loans to Small Businesses
granted by the government is something difficult to understand. It is certainly a limitation of the scope of this bill, the function of which is to assist small businesses.


Donald Methuen Fleming: It is quite clear from the remarks of the hon. member that he realizes himself that the amendment is extending the scope of the bill and, consequently, the charge upon the crown.


Jacques Flynn: I would be interested in hearing the hon. member for Cartier address himself to the question of whether or not his amendment would be a repetition of the one moved by the hon. member for Levis or the one moved by the hon. member for Laurier.


Leon David Crestohl: First of all, Mr. Chairman, as I said before, the amendment moved by the hon. member for Laurier was an attempt to add a new definition to clause 2. As I said before, clause 2 does not contain a definition of "lender". If you look at the amendment moved by the hon. member for Laurier you will find that his objective was to add a definition of "lender". Since that was defeated I have attempted to extend the interpretation of the word "bank", which is not the same thing.
In this case, of course, banks are the ones that would be the lenders. I respectfully submit that adding a wider definition of what may be a bank under this bill is not the same as adding another subclause to define the word "lender".
As to the amendment moved by the hon. member for Levis, he addressed himself to credit unions or caisses populaires. I have distinctly not included or named credit unions or caisses populaires. Not one of the amendments submitted so far have requested the addition of trust companies, insurance companies or loan companies, which are authorized by their charters to make loans. I am now making this request for the first time. I should like to ask the minister just why he wants to limit this power to the banks. Trust companies are certainly as reputable as banks; insurance companies are as reputable as banks, and they are all privately owned organizations operating under government charter. I cannot understand the minister's insistence upon limiting the measure to banks. (Translation):


Mr. Caron:: Mr. Chairman, I rise with regard to the objection raised by the minister. The minister said that, if the amendment were agreed to, it would have the effect of enlarging the charge upon the crown. Now, if we read the bill a little further we see that in section 6 there is a limit of $300 million-


Jacques Flynn: I am sorry to have to interrupt the hon. member, but I asked the com-90205-6-21
mittee to give me their views on the possibility of this amendment being substantially different from the one suggested by the hon. member for Levis (Mr. Bourget) and the amendment moved by the hon. member for Laurier (Mr. Chevrier). It is mainly on that point that I want to hear hon. members.


Alexis Pierre Caron: I am sorry to have to differ from you, Mr. Chairman, but when the minister stated his position, he mentioned the fact that the charge upon the crown would be enlarged. Now, in view of this part of the legislation being as important as the other and also in view of enabling the chairman to render a decision with regard to this matter, I believe that we have the right to reply to the minister's objections before any ruling is given.


Jacques Flynn: I want to point out to the hon. member for Hull that it is the Chair's discretion to hear any arguments. Apparently, I have not made myself clear, and I wish to say that what I want is to hear arguments on the suggestion that this amendment is but a repetition of the former amendment. That is the only point on which I want to be enlightened before I give a ruling.


Alexis Pierre Caron: Does Your Honour intend to rule at this time that the argument advanced by the Minister of Finance (Mr. Fleming) is not valid? If that is your intention, my argument is useless and you are right in asking me to sit down. But if the Chair rules that the views expressed by the Minister of Finance are valid, well, there-


Jacques Flynn: I thought it was unnecessary to make a blueprint for the hon. member.


Alexis Pierre Caron: Without wanting a blueprint and this is an important matter, because there are all kinds of blueprints-I say that when a minister or any member starts a discussion, we are entitled to reply.


Jacques Flynn: This is not a question of debate, we are simply dealing with a point of order, and I see that the hon. member for Hull has no argument to bring up on the point I emphasized. I shall therefore immediately give a ruling.
(Text):
The only point which I think important in appreciating this new amendment is whether or not it is, in substance, a repetition of the amendment moved by the hon. member for Levis, which was ruled out of order because it was, in substance, the same amendment as one moved by the hon. member for Laurier which was negatived by the committee today. Although I would say that
320	HOUSE OF
Guarantee of Loans to Small Businesses the amendment moved by the hon. member for Cartier goes a little farther than the one moved by the hon. member for Levis, I would think that it is in substance the same. Citation 194 to which I referred the committee earlier in deciding upon the relevance of the amendment moved by the hon. member for Levis applies equally here. For this reason I rule the amendment out of order. (Translation):


Alexis Pierre Caron: I appeal from your ruling, Mr. Chairman.
(Text):


Mr.   Chairman@: Shall clause 2 carry? (Translation) :


Alexis Pierre Caron: I appealed from your ruling, Mr. Chairman.


Jacques Flynn: I understood the hon. member to say that he would keep my ruling in mind.


Hédard-J. Robichaud: It is matter enough to be kept in mind.
(Text):
Mr. Speaker resumed the Chair, and the chairman of the committee made the following report:
When clause 2 of Bill No. C-40, an act respecting loans to proprietors of small business enterprises for the improvement and modernization of equipment and premises was being considered in committee of the whole Mr. Crestohl moved an amendment as follows:
"Add to subsection (a) of clause 2 the following: 'and to all other institutions such as trust companies, insurance companies, loan companies and all other companies authorized by government charter to lend money, all of which shall be first approved by the Minister of Finance.' "
The chairman ruled the amendment out of order on the ground that it raised in substance the same question which was negatived by the committee in this sitting. Whereupon Mr. Caron appealed to the house from the ruling of the Chair.
Mr. Speaker put the question as follows: The question before the house is an appeal from a ruling given by the chairman of the committee of the whole as follows:
That when clause 2 of Bill No. C-40, an act respecting loans to proprietors of small business enterprises for the improvement and modernization of equipment and premises was being considered in committee of the whole Mr. Crestohl moved an amendment as follows:
"Add to subsection (a) of clause 2 the following: 'and to all other institutions such as trust companies, insurance companies, loan companies and all other companies authorized by government charter to lend money, all of which shall first be approved by the Minister of Finance' ".
The chairman ruled the amendment out of order on the ground that it raised in substance the same question which was negatived by the committee in this sitting. Whereupon Mr. Caron appealed to the house from the ruling of the Chair.


Jacques Flynn: Order. Now that the house has confirmed the decision of the Chair with regard to the amendment proposed by the hon. member for Cartier the committee will resume consideration of clause 2 of Bill No. C-40.
(Translation):


Mr. Racine:: Mr. Chairman, I have a question concerning subsection 3, paragraph 4 of section 2. Could the minister tell the house whether rural telephone companies are included among service businesses?
(Text):


Donald Methuen Fleming: Service businesses naturally cover a wide range of enterprises. Some of them, for instance, cleaning establishments, are already covered under the industrial development bank. There are various service categories under the heading, and that is one example.
(Translation):


Jean-Paul Racine: My point is this, Mr. Chairman: Are rural telephone companies included among the service businesses mentioned in this bill?
(Text):


Donald Methuen Fleming: I would say, no, Mr. Chairman.


Mr. Martin (Essex East):: Having in mind the number of people who are out of work in this country, I take it the minister has given some consideration to the number of men and women who would likely be put back to work as a result of these measures which the government is bringing forward at this time. Would the minister make a statement with regard to this matter?


Donald Methuen Fleming: I made a statement on that subject over a week ago when the bill was before the committee of the whole. If the hon. member will look back in the record he will find that I gave the committee the estimate which was given by 90205-6-211
Guarantee of Loans to Small Businesses the leading organization of retail merchants in Canada, that there is work in the renovation and improvement of premises which would probably involve $75 million in loans. That amount of work is, in their view, available, and would go forward if this measure ever is passed. We have been discussing this measure for four days now, and I suggest that the time has come to get on with this legislation and show that we really mean to help small business and provide the employment.


Paul Joseph James Martin: The minister says he wants to get on with this bill, and so do we, and we have been co-operating in this house.


Some hon. Members:: Oh.


Paul Joseph James Martin: The Minister of Finance, who now displays synthetic anger, ought to indicate to the committee in precise terms how many men are going to be put to work as a result of this measure. He says it is possible that $75 million will be provided by guaranteed loans but that is no indication how many men and women will be put to work under this scheme. The scheme is restricted under clause 2(d)(i)(ii>
(iii) to a limited form of assistance. If the hon. gentleman had accepted an earlier amendment providing for assistance for the purchase of enterprises in order to assist the private sector, then the bill would really be an effective measure for putting people back to work, but in the absence of a more precise reply from the minister we can only conclude that the government has no idea how many men this measure will put back to work.


Donald Methuen Fleming: And the government can only conclude that the opposition has had its tongue in its cheek all the way through this session to date. They started by professing their desire to expedite legislation designed to increase employment. Well, we have been engaged on this measure for four days. The hon. member talks about co-operation. We were on the second reading and the discussion of the clauses of this bill all day yesterday and all day today; far from seeing any evidence of co-operation, I see a succession of frivolous amendments introduced for the purpose of obstructing this measure. We have now spent the equivalent of a full day just discussing the definitions in the measure, the definition clause of the bill.


Charles Benjamin Howard: On a point of order, I understood the Minister of Finance to say that the amendments which had been introduced and, presumably, the one I had introduced, were frivolous and for the purpose of obstruction.


An hon. Member:: All right, admit it.
322	HOUSE OF
Guarantee of Loans to Small Businesses


Charles Benjamin Howard: I hear a noise from the back from the man who claims he is not a communist. My point of order is that the Minister of Finance has indirectly cast a reflection on the reason why I introduced an earlier amendment. May I say that it was not a frivolous amendment and it was not designed to obstruct the progress of this bill and I would therefore ask the minister to withdraw his allegation which is not true.


Donald Methuen Fleming: I withdraw nothing. I am speaking about the assertion of the hon. member for Essex East-whom we welcome back to the house after his absence- and his assertion that co-operation has been extended by the official opposition with regard to this measure. I would like to tell him, for his information, because he joined us I believe only yesterday, that we spent a full day on the resolution stage of this measure last week, and in various stages here we have already consumed something like four days.
This is a measure that the opposition professed to welcome; it is a measure that the opposition supported to a man on second reading. There was not a voice raised in opposition to it, and yet now that we are in committee we do not seem to be able to make any progress. This does not sound a bit like co-operation, Mr. Chairman. I would hope that with the merits of this measure having been acknowledged by the opposition and welcomed by representatives of those organizations of small businesses that are going to derive benefit from it, we could address ourselves to getting on with it instead of going back and debating things that have already been debated all day today as well as last evening.
It is not a long measure. There are about three more pages of legislation. I would hope, Mr. Chairman, if we wish to extend the benefit of this measure as soon as possible to those whose need of intermediate credit has been acknowledged by all parties in this house, that we have the opportunity of doing it now, but I think it will take something more serious than has been happening of late to achieve that purpose.
The hon. member for Essex East asks about the number to be employed. No one can pinpoint the number of people who will derive employment at any one particular time, but we have been assured by the representatives of the retail organizations in this country that they see $75 million worth of credit being taken up at once by retail businesses alone in the renovation, enlargement and modernization of their premises. I think that that amount of construction business, not to mention the work


that goes into the construction of equipment as well as the on-site work, holds the promise of tens of thousands of jobs. I would suggest that this objective is one that, having regard to the general support expressed for the measure in the house, warrants our expeditious treatment of it.


Paul Joseph James Martin: Mr. Chairman, the minister has spent considerable time in lecturing the committee, and that is his privilege, if he wishes to consume the time of the committee in this manner. But what the hon. gentleman fails to recognize is that if he is at liberty to tell other hon. members how they shall conduct themselves, we on this side are at liberty to inquire from the government what precise benefits by way of giving work are likely to flow from this measure.
The hon. member has said that we have given support to the principle of this bill. That is true. This bill, so far as it goes, has many commendable features. No one has denied that. It is commendable at this time that the government should be prepared to guarantee loans to cover the purchase, installation, renovation, improvement or modernization of equipment of a kind usually affixed to real or immovable property; the purchase, renovation, improvement or modernization of equipment of a kind not usually affixed to real or immovable property; the renovation, improvement or modernization of premises; or the alteration or extension of premises. This is desirable, and undoubtedly some people will be put to work as a result of this measure. But the government comes forward with a blare of trumpets and says that it is bringing in legislation that is going to deal with the severe problem of unemployment in this country and this bill is offered as evidence in support of that statement. I say to the minister, he has not given us any evidence tonight, or during the discussion of the bill, that supports his statement.


Some hon. Members:: Order; sit down.


Jacques Flynn: May I remind the committee that standing order 59 (2) says: Speeches in committee of the whole house must be strictly relevant to the item or clause under consideration.
We are now studying clause 2 of the bill and therefore only discussion on clause 2 is relevant. I am sure that the exchange which has taken place had more to do with the principle of the bill than the clause under consideration.


Paul Joseph James Martin: Mr. Chairman, there is no quarrel with what you have said. I submit to you that what I have said does not in any way detract from the character

of the observation that you have made. I am asking the Minister of Finance how many people this particular measure will put to work.


Jacques Flynn: Order. If I may be more specific in my ruling, I will say that the question put by the hon. member is not relevant to clause 2 of the bill.


Paul Joseph James Martin: Mr. Chairman, the Minister of Finance said that this measure would put tens of thousands of men to work. You are not saying that I am not entitled to question that statement and to ask him to show us why that is so. He says that $75 million worth of guaranteed loans will be provided under this clause to those who require such credit. I am asking the Minister of Finance now-


Jacques Flynn: Order.


Paul Joseph James Martin: I have not asked the question.


Jacques Flynn: I will say specifically that the exchange between the hon. member for Essex East and the Minister of Finance which has taken place was completely out of order. Have I made myself clear?


Paul Joseph James Martin: Mr. Chairman, are you now suggesting that I do not have the right to ask the Minister of Finance how many people this particular measure will provide work for?


Jacques Flynn: I do not have to tell the hon. member for Essex East when the question might be put but I am sure he will understand when I say this is not the time. Shall clause 2 carry?


Charles Benjamin Howard: Mr. Chairman, I have one or two thoughts to express to the minister on subparagraph (f) which defines the class of equipment to be used in the carrying on of business. The negative part of the clause reads:
-but does not include stock-in-trade or goods described in the inventory of the enterprise.
If we are going to provide government guaranteed loans to small businesses to assist them in competing, at it were, with larger corporations, chain stores, and the like, perhaps we should include as a legitimate expense for the purpose, or one of the purposes for which a small business could borrow money, the purchasing of stock for I am sure there will be a number of occasions during the year when small businesses would find it to their advantage if they could buy certain commodities or stock in volume, thus realizing a smaller cost per unit of whatever it is they are purchasing. Otherwise, they may find themselves, as many of them do
Guarantee of Loans to Small Businesses and will, in an awkward position so far as finding sufficient capital to make those volume purchases is concerned.
It would seem to me it would be in keeping with the thoughts expressed by the minister. I do not want to get into the question of unemployment again, but it would seem to me that one of the purposes of the bill is to promote employment. If that is so, then surely the other purpose is to assist small business in the normal, everyday functions also. It would seem to me that a sensible amendment or change would be to allow the small businessman to purchase stock in trade, as it is called here, or goods described in the inventory of the enterprise. Would the minister comment on why that is specifically excluded?


Donald Methuen Fleming: The exclusion is based on very sound grounds. The hon. member must appreciate that the purpose of the bill is to provide government guarantees of bank loans to designated classes of small business for the purpose of making capital improvements, that is to say, improvements, renovations and modernization of premises and the purchase and acquisition of equipment. Those are specific physical assets which are capable of providing security. To suggest now that the measure should be broadened to permit the credit underwriting of the purchase of stock in trade takes us into an entirely different field quite outside the scope of the measure and outside the principle of the bill. The government can hardly be invited to launch into the business of providing guarantees for bank loans for the purchase of the stock in trade of businesses. There is no measure of security control over that which can be made effective in a workable manner in a measure of this kind.
This matter was very carefully discussed. This is the measure that was asked for by the representatives of small retail business in Canada. They did not come forward and ask for government guarantees of bank loans for the purchase of stock in trade; they asked for government guarantees of bank loans to permit them to renovate and modernize their premises. The purpose of the measure is clear and the reasons why the measure takes its present form are clear. I think the hon. member on reflection will see that his proposal goes quite outside the scope of the bill into a different area entirely.


Charles Benjamin Howard: Apart from the fact that somebody did or did not ask for it, I think the main reason is that the loans are for capital expenditures on permanent assets that are not liquid and on which a valuation can be placed whereas stock can
324	HOUSE OF
Guarantee of Loans to Small Businesses be moved. That is the principle that I take from the minister's comments. Such being the case, I cannot for the life of me understand why he did not include in the bill the change suggested earlier today by the hon. member for Kootenay West to the effect that loans should also be made for the acquiring of property and the acquiring of capital assets. The minister cannot argue out of both sides of his mouth on this question.


Chesley William Carter: I should like to ask the minister whether the classes of businesses included in manufacturing would include saw mills and whether the manufacturing process could be regarded as encompassing logging as a stage in the manufacturing process. While I am on my feet I should like to ask the minister if during the dinner hour he was able to get the information in order to be able to reply to the question I asked him earlier. The minister made the remark that the question was irrevelant but I should like to tell him that it is just as relevant to know how many loans were made by banks to Newfoundland fishermen as to know how many were made by credit unions, and the minister himself insisted on putting that information on the record.


Donald Methuen Fleming: There are three questions. As to No. 1, saw mills, the answer is yes. As to No. 2, logging operations, the answer is no. As to No. 3, the information is not available yet but will be made available.


Mr. Denis:: Does the legislation cover taxi drivers who wish to buy new cars?


Donald Methuen Fleming: No.


Azellus Denis: They are service businesses.


[Stage Direction]
Clause agreed to.
On clause 3-Minister's liability to bank.
Leon David Crestohl: I should like to ask the minister a question about clause 3. I note that there are approximately a dozen requirements that must be complied with before a loan can be made for which the government will be responsible. They are quite serious conditions which the banker must make sure have been met before he approves the loan. Can the minister tell the house whether he discussed this matter with the bankers and presented to them the various conditions that they will have to see are met by prospective borrowers and is he able to report to the committee that the bankers were agreeable to accepting all these obligations under clause 3?


Donald Methuen Fleming: The banks were made aware of the contents of the bill.


Copies of the bill were sent to them since it was introduced. There have been discussions. I might say that so far as the conditions in clause 3 of the bill are concerned, I am not aware that there is anything in that clause that the banks find repugnant. As a matter of fact, they are all familiar conditions because this clause has its counterpart in the Farm Improvement Loans Act.


Leon David Crestohl: While the banks may not have informed the minister that they find these conditions arduous and difficult, have they informed him that they are agreeable to making loans under these conditions?


Donald Methuen Fleming: I have already said on four or five different occasions in the course of the discussion of this measure that we have received from various banks the assurance of their full co-operation in making this measure effective for the purposes for which parliament presumably intends it.


Chesley William Carter: Mr. Chairman, subclause 1 (d) of clause 3 limits the amount of loan to a business to $25,000. Twenty five thousand dollars may be sufficient for many small businesses but I feel that for manufacturing businesses this maximum amount is a little too small. I think we should bear in mind that if we are trying to increase employment one of the most fruitful avenues to explore is the encouragement and expansion of manufacturing industries. For that reason, Mr. Chairman, I move:
That clause 3, paragraph (d), be amended bj adding after "$25,000" in line 28 the following:
"or 25 per cent of estimated gross revenue, whichever is greater".


Donald Methuen Fleming: Mr. Chairman, I am sure that not much time will be required to dispose of this amendment because it is so clearly out of order. The hon. member smiles at having introduced it. It is clear that his purpose is to increase the maximum amount of a loan. The maximum permissible loan as established in the bill is $25,000 and the hon. member wants to increase that. Obviously that is an increase in the charge upon the crown and such an amendment is clearly out of order when introduced by a private member of the house.


Mr. Benidickson:: I should like to speak
briefly on the point of order. I suggest that the minister's objection to the amendment is hardly valid in a bill which imposes, as clause 6 does, an over-all limitation on the liability of the crown because it is stated in clause 6 that, regardless of what may be provided in the other clauses of the bill, the total maximum liability of the crown is $300 million over a period of three years. Therefore I suggest that no matter how you revise

the details of that expenditure the liability of the crown is definitely set in clause 6 and remains fixed at $300 million regardless of any amendment such as has been proposed by my hon. friend.


Donald Methuen Fleming: The hon. member for Kenora-Rainy River has not been in the house following this measure for very good reasons-he has been in New York at the United Nations. This point was raised in the discussion preceding an earlier ruling this afternoon. The provision in clause 6 simply establishes a maximum, a ceiling. If the point raised by the hon. member for Kenora-Rainy River were sound it would lie within the power of any private member in the house to rewrite the bill, to alter by way of increase all the provisions of the bill that create a charge upon the crown and say, "Oh well, there is a limit set by the bill; I am not affecting the limit". It is a question of when the limit is reached. The limit could be reached much faster with this amendment and others of the same nature that have already been ruled out of order because they created a charge upon the crown.


Jacques Flynn: This amendment raises the same point on which the Chair was called upon to rule a few days ago because even if it does not provide an automatic increase in expenses, as the minister pointed out it certainly increases the possibility. It is obvious that paragraph (d) would be amended by providing loans up to an amount of $62,500 instead of the maximum of $25,000 already provided.
The other day, if I remember correctly, I quoted from citation 246 of Beauchesne's fourth edition, page 207, and this might be worth repeating:
In relation to the standard thereby fixed, an amendment infringes the financial initiative of the crown, not only if it increases the amount, but also if it extends the objects and purposes, or relaxes the conditions and qualifications expressed in the communication by which the crown has demanded or recommended a charge.
It seems to me, therefore, that the amendment should be ruled out of order and, for that reason, I so rule.


Leon David Crestohl: Mr. Chairman, clause 3
speaks of the estimated gross revenue. I do not see a definition of gross revenue. It is intended that gross revenue shall mean gross sales or gross profit or what is gross revenue to be?


Donald Methuen Fleming: Mr. Chairman, the hon. member has evidently not read the provisions of clause 2 of the bill which have already been adopted. He will find a definition of gross revenue in clause (h).
Guarantee of Loans to Small Businesses Mr. Howard: Clause 3 (f) is one about which I am concerned because it would seem to me this would be the one place in which we could deal with the question of interest. It is the one place in the bill where interest is mentioned. The paragraph reads:
(f) no fee, service charge or charge of any kind other than interest-
I assume that this paragraph is dealing with interest on the loan and therefore we can deal with the question of interest. During the debate on second reading we advocated that the interest rate should be pegged at 5 per cent, simple interest, as was done in the Fisheries Improvement Loans Act. The reason for limiting the interest rate that can be charged rather than leaving it open is based primarily upon the fact that there is no risk involved in so far as the bank is concerned in making loans under this particular measure. There is certainly no risk if past experience in so far as activities under similar legislation are concerned is any criterion because the bad debts were infinitesimal as compared with the total amount of money lent. Certainly a bank should be required, especially in view of the fact it enjoys a sort of monopoly under this measure, to grant a lower rate of interest. As I said, we believe it should be 5 per cent as we indicated during the debate on second reading.
I think perhaps this is the only place in the bill where we can indicate, not only in a general way orally but in a formal way by moving an amendment, our belief that the interest rate should be 5 per cent. This is one of the requirements that parliament should exact from the banks in order to protect small businessmen as much as possible. I would move, therefore, Mr. Chairman:
That paragraph (f) of subsection (1) of clause 3 be amended by adding in line 33, after the word "interest", the following "at a rate not in excess of five per cent per annum simple interest,".
The paragraph would then read:
(f) no fee, service charge or charge of any kind other than interest at a rate not in excess of five per cent per annum simple interest, except such charge for insurance as may be authorized by the regulations-
And so on. I believe this is one of the requirements which parliament should exact from the banks because there are no risks involved. This is something we should do to ensure that small businesses do operate in the best possible manner in our economic society. Certainly, the interest rate has been pegged in other pieces of legislation which are in existence.


Donald Methuen Fleming: 
looking for special treatment. They are looking for a facility which was not open to them previously and which is opened to them in the field of intermediate credit by this measure. They are very happy with the measure. I have received their most enthusiastic expressions of approbation of the measure after having considered and perused its terms.


William Moore Benidickson: I wonder whether the minister would refresh my recollection of the terms of the Farm Improvement Loans Act, which he has indicated was the basic pattern for this act, with respect to interest? Is it a fixed rate of interest in the Farm Improvement Loans Act or is it an open rate?


Donald Methuen Fleming: No. That act stipulates an interest rate of 5 per cent per annum simple interest.


Charles Benjamin Howard: I should just like to point out that here is another indication of the government being quite willing to accept all the credit in the world for having been the government in office for the shortest period of time and having boosted up interest rates all across the board to the fullest extent, including interest rates on its own borrowings, interest rates to people who borrow under the National Housing Act and now interest rates to small businessmen. They are all jacked up higher and higher. It is an indication that the Minister of Finance and this government, like the one preceding it, has absolutely no control or no concern or desire to have control over the issuance of credit, currency or interest rates in this nation. They are at the beck and call and mercy of the private lending institutions. This is another indication.
The minister made that admission just a moment ago. He said they did not want to set interest rates at a certain level because if they did so the poor banks would go and lend their money somewhere else because they would find it more lucrative to do so. Those are the words of Walter Harris who was minister of finance when the interest rate on N.H.A. loans was increased to 5j per cent or 5} per cent, I think it was.
The Minister of Finance who sat over here on this side of the chamber at that time raised the roof about that matter. "You are selling out the home owners" was his cry at that time. Of course he was not concerned about them. Obviously he was only concerned about getting into office so that he could do the same sort of thing himself. This is a sad attempt on the part of the Minister of Finance, reportedly in office in a government which is supposed to control the affairs of this nation, when he stands up and admits that he has no control whatsoever over the credit

of a nation, that someone else outside of parliament is pulling the strings and that he is just jumping to that particular tune.
My friend the hon. member for Bonavista-Twillingate may be interested in whether the fishermen in Newfoundland are ever able to borrow. But the fishermen out west will appreciate knowing full well that it will not be long before this government will be jacking up the interest rates on fishermen and knowing that this is a sell-out of the small business people, regardless of how much the minister may let the words pour forth as to how they are helping the people and so on. It is a disgusting sort of action on the part of the minister and this government.


William Heward Grafftey: Would you nationalize the banks?


Donald Methuen Fleming: In this welter of wild irresponsible talk we have heard from the hon. member for Skeena one looks in vain for any resemblance between what he says and the facts or indeed the plain truth. It is typical of the hon. member to attempt to cast aspersions on others in the House of Commons and on the government in particular. So far as the rules of the House of Commons are concerned, they matter little to him. But let us not pause, Mr. Chairman, even to stand on the rules of the house in this matter. I throw back in his teeth every one of the accusations which he so improperly and unfairly made. Those accusations are false, every one of them, in every word, every letter and every syllable of every word. I hope I have made myself clear in that respect.
Now may I say a word about interest rates. Interest rates in a free economy-not the regimented economy in which the hon. member believes but a free economy-are established literally by tens of thousands and sometimes millions of transactions, and interest rates rise and fall depending upon the demand for money and the supply in relation to that demand. I have tried to make this point clear previously, Mr. Chairman.
When the hon. member talks about interest rates rising and rising, may I ask him this question. Why does he not either acquaint himself with the truth or at least state it? The fact is that while interest rates rose in 1959, from the autumn of 1959 until quite recently they were steadily declining. However, he does not see fit to mention that fact if he is aware of it. It did not commend itself to his sense of fairness, if any, to mention that fact. I think hon. members know how to assess the slurs of the hon. member for Skeena.


Charles Benjamin Howard: Obviously, Mr. Chairman, I cannot allow these distortions by the minister to go unanswered. We all know, of course
327
Guarantee of Loans to Small Businesses that his many years of activity in this house, especially in the party to which he belongs, naturally lead him into making accusations of this sort. However, the facts are plain. I stated them clearly and simply. The minister just refuses to face up to the facts. He just wants to gloss over the shortcomings of himself and of the government of which he is a member. It is unfortunate that possibly he is a little bit nettled because of having missed so many cabinet meetings recently and having to sit here and account to this House of Commons for a bill which falls far short of what it should do, if it is to do anything proper in order to assist small business people and to do anything proper in so far as credit is concerned.
The minister knows full well that it was under his government that just recently National Housing Act interest rates were increased. That is a fact. Yet he gives the lie to that statement; he says it is a falsehood. This is not in keeping with the dignity of the Minister of Finance. Maybe he still thinks he is sitting on this side of the chamber when he wrapped himself in the union jack on a memorable occasion. I do not know whether or not he has some psychological block that will not allow him to reach the stature a cabinet minister should reach as far as responsibility is concerned; if he has such a block, I feel sorry for him.


Mr. Brunsden:: On a question of privilege, Mr. Chairman, may I say this. The hon. member is making an attack upon the minister which is not within the confines of the debate. With all due deference, Mr. Chairman, may I say that I think you should call him out of order.


Jacques Flynn: Of course I think I should remind the committee generally that we are discussing the amendment.


William Moore Benidickson: If this fight between the minister and the hon. member for Skeena is concluded, I should like to make a couple of observations in connection with the amendment. The first one is that the minister has indicated to this house that in the act which provided the pattern for this form of guaranteed bank lending, the Farm Improvement Loans Act, there is a fixed rate of interest.
I think the minister will recall that he has boasted that year after year, despite a fixed rate of interest under the Farm Improvement Loans Act, he has been able to report to the house, in times of high interest rates generally and in times of more moderate interest rates generally, an increase in the volume of loans made under that act. I think that substantially takes away the substance of his argument that a fixed rate of interest
328	HOUSE OF
Guarantee of Loans to Small Businesses would perhaps have a deleterious effect upon the amount of lending that would be made to business.
The other point that concerns me and gives me some worry is that the minister has just told us that interest rates went up very substantially, to a peak in the autumn of 1959; then he boasts that since 1959 there has been a decline generally in the prevalent rates of interest in this country. But the fact to which I think hon. members should give attention is that when rates of interest go up the banks tend to increase what the minister has referred to as their prime lending rate; indeed, they did establish a prime lending rate of only one quarter of one per cent below the maximum provided under the Bank Act, which is 6 per cent. When rates went up as they did in 1959 the banks protected themselves by a prime rate of interest of 5 J per cent.
But what concerns those of us who are alarmed at the absence of a fixed maximum rate of interest in this legislation-as is provided for farmers in the Farm Improvement Loans Act-is the fact that although the minister points out that since the autumn of 1959 interest rates generally have declined, the prime rate of interest he has referred to in connection with bank lending has not declined proportionately.
I repeat that the record shows that notwithstanding a fixed rate of interest the banks, because of the element of guarantee by the government-and the record over the years of a very nominal loss under the Farm Improvement Loans Act-and notwithstanding high rates of interest one year and low rates of interest another, have been lending more in volume to the farmers.


Some hon. Members:: Question.


Jacques Flynn: Is the committee ready for the question?


William Arnold Peters: Mr. Chairman, before the question is put, could I ask the minister one question. In relation to the one act that is similar to this bill, the fisheries act, has the position of loans to fishermen been detrimentally affected by the fact that there is in that act a set rate of 5 per cent simple interest? Has this been detrimental to the amount which has been loaned, while other forms of interest have risen in general in recent years?


Donald Methuen Fleming: Mr. Chairman, I know that when interest rates have gone up the banks have complained that the interest rate fixed in the measure is not high enough to be comparable with competing rates available to them elsewhere. They indicated that they wished to lend in accordance with the


desires of parliament expressed in legislation, but they urged that in the light of rates available in other fields, the rate was low.
It is having regard to that situation and the numerous other factors I have mentioned that in this case, dealing with commercial credit to businessmen-because here we are dealing with people who are in business and are accustomed to these transactions-it appeared to us that the measure would be much more effective with interest rates to be adjusted in the way I have indicated than if a fixed rate were stipulated in the statute.
Amendment (Mr. Howard) negatived: Yeas, 13; nays, 81.


Jacques Flynn: I declare the amendment lost. Shall the clause carry?


[Stage Direction]
Clause agreed to.
On clause 4-Termination of operation of section 3.
Jacques Flynn: Shall clause 4 carry?


Some hon. Members:: Carried.


Chesley William Carter: Mr. Chairman, on clause 3, paragraph (f)-


An hon. Member:: Clause 4 is carried.


Chesley William Carter: I stood up, Mr. Chairman, when you asked if clause 3 should carry.


Jacques Flynn: Clause 3 was carried; but of course if the commitee is willing to revert to clause 3, that can be done. Is it agreeable that the committee revert to clause 3?


Some hon. Members:: No.


William Moore Benidickson: Mr. Chairman, there is no question of reverting to clause 3. The hon. member was on his feet-I heard his voice behind my shoulder-while other hon. members were shouting "carried". A majority has not got that kind of right in this parliament.


Donald Methuen Fleming: Mr. Chairman, I suggest that if the hon. member for Burin-Burgeo has a point to raise on clause 3, we should hear it.


Chesley William Carter: Thank you, Mr. Chairman. I just want to ask one question about the insurance provision in paragraph (f). Will the insurance cover the whole loan, or only 90 per cent of the loss for which the bank is responsible? In other words, will the government guaranteed 10 per cent be covered by insurance?


Donald Methuen Fleming: Mr. Chairman, in an ordinary situation of this kind the banks would require insurance. The purpose of this clause is that there may be no interference with that very sound banking practice. It is not a question of the government putting

a limit on insurance; it is rather a question of stipulating that no guarantee shall be given to any bank on any loan made by the bank where additional charges have been imposed, except those authorized in clause (f); and that makes provision for the normal charge for insurance that the banks take in these cases as part of the security for their loans.


William Moore Benidickson: Mr. Chairman, I wish to ask a question on clause 4. Is the language of this clause similar to the Farm Improvement Loans Act provision? This is in regard to the matter of giving notice to the banks for termination of loans of a certain category?


Donald Methuen Fleming: Yes, Mr. Chairman, it is similar to the provision in the Farm Improvement Loans Act.


[Stage Direction]
Clause agreed to.
Clauses 5 and 6 agreed to.
On clause 7-Regulations.
Chesley William Carter: Mr. Chairman, may I ask this question. When the definition of "manufacturing" is drawn up will it include printing establishments?


Donald Methuen Fleming: Yes, Mr. Chairman, I would judge printing to be manufacturing.


William Moore Benidickson: While it is true, as the minister has pointed out, that I have been away attending some sessions of the United Nations, I have been able to read some of the discussion which took place at the resolution stage and I note with satisfaction that the minister has indicated that those engaged in the tourist industry will be among the small businessmen entitled to loans under this bill. Do they reach that status by virtue of the phrase "service business"?


Donald Methuen Fleming: Yes, Mr. Chairman.


William Moore Benidickson: How extensive does the minister contemplate the regulations will be in outlining or expanding some of these phrases? Will they require some rather detailed spelling out?


Donald Methuen Fleming: I think the hon. member is familiar with the kind of regulations which have been promulgated under the provisions of the Farm Improvement Loans Act, the Fisheries Improvement Loans Act and the Veterans Business and Professional Loans Act. The regulations to be made under this measure will correspond with those regulations in nature and extent.


William Moore Benidickson: I am familiar with those regulations but, as I recall it, it was not members of the opposition who pointed out during the debates on previous stages of
90205-6-224
Guarantee of Loans to Small Businesses this bill that they have found to their disappointment that sometimes in the past fairly broad provisions had been inserted in the bill itself but that when the house gave the governor in council the privilege of making regulations those regulations turned out to be considerably narrower than any layman or ordinary person might have imagined from the broad nature of the definitions in the act itself. That is why it is necessary, when these broad powers to make regulations are taken, to question the administration and find out its intention with respect to particular trades such as the one in which I have shown some interest-the tourist industry-and so on, because it would be very easy under this clause, for instance under the broad term "service business", to say by order in council that service business would include (a), (b), (c), and (d), but that it would not include such other trades as (f), (g), (h) and (j).


Donald Methuen Fleming: The definitions of manufacturing are fairly well established now by the classifications of the dominion bureau of statistics. What will be done under this measure can be expected to conform reasonably with those established approaches.


William Moore Benidickson: In connection with the wholesale trade, would the trade of a wholesaler generally be a trade entitled to borrow under the Industrial Development Bank Act?
I know that the retail trade is excluded, and I know that manufacturing generally is included.


Donald Methuen Fleming: No.


William Moore Benidickson: Neither wholesale nor retail trade is eligible to borrow under the Industrial Development Bank Act, is that right?


Donald Methuen Fleming: That is right. The hon. member is familiar with the provisions of the Industrial Development Bank Act.


Chesley William Carter: I should like to ask the minister if he is satisfied that there is no necessity to define "equipment" as is done in the case of the other terms included in this provision?


Donald Methuen Fleming: I draw the attention of the hon. member to clause 2 (f) where "equipment" is defined.


[Stage Direction]
Clause agreed to.
On clause 8-Bank security.
Leon David Crestohl: I wonder if the minister can inform the committee what attention has been given to the fact that in the province of Quebec chattel mortgages are not recognized? In this clause the bank is authorized to take hypothecs or liens on movable property. That is a procedure which falls directly within
330	HOUSE OF
Guarantee of Loans to Small Businesses the scope of the civil law of the province of Quebec, which does not approve chattel mortgages. Perhaps the minister would offer some explanation how it is envisaged that borrowers in the province of Quebec may enjoy the privileges of this clause notwithstanding this provision of provincial law.


Donald Methuen Fleming: We cannot change the law of Quebec and we do not intend to attempt it. It will be within the power of the banks to take such security offered by an applicant within the terms of clause 8 as is permissible under the law of the province.


Leon David Crestohl: The minister will agree, then, that borrowers in the province of Quebec will not have the latitude in offering securities or guarantees as those who live in other provinces.


Donald Methuen Fleming: May I tell the hon. member that there is no difference in that respect from the situation which exists in the ordinary practice of bank lending today. The Bank Act was amended in 1954 to permit the banks to lend on the security of chattel mortgages. If, as the hon. member says, that was not effective in Quebec that did not impede parliament from legislating to permit the banks to make loans on that security elsewhere. The position is the same under the clause of this bill which we are now discussing.


Leon David Crestohl: I appreciate that, but this is not the first time the people in the province of Quebec are facing a difficulty which does not exist for those who live in other provinces, and I feel that borrowers in the province of Quebec should somehow be permitted to be able to pledge their chattels in order to borrow money, though I do not see how it could be done under this act.
(Translation):


Mr. Dorion:: Mr. Chairman, I believe that the hon. member has misconstrued the signification of this clause. Banks come under federal jurisdiction, and I do not think that the civil code of the province of Quebec can interfere with the Bank Act and the rules enacted under it.
(Text):


Leon David Crestohl: I must respectfully differ
from the hon. minister. It is certainly true that no legislation of this parliament can invade the rights of property in the province of Quebec, for that would certainly be in conflict with the British North America Act and the rights of the province.


[Stage Direction]
Clause agreed to.
An hon. Member:: Ten o'clock.


Donald Methuen Fleming: Could we finish these remaining clauses?


Mr. Churchill:: Would the committee consent to our continuing for a few minutes?


Lionel Chevrier: So far as I am concerned, on behalf of our party there is certainly no objection to continuing in order that we may get this measure through.
Clauses 9 to 11 inclusive agreed to.
On clause 12-Coming into force.


Charles Benjamin Howard: Can the minister give us some indication whether it will take much time before the regulations are adopted and submitted to His Excellency? Could he give us any indication when they will be promulgated?


Donald Methuen Fleming: Work has been going forward on the regulations and we expect to be in a position to promulgate the regulations almost as soon as the bill has been adopted and has come into effect. So far as proclamation is concerned, it will be necessary to allow time for copies of the measure and the regulations to reach the various branch offices of the banks of Canada. But I am hopeful that if this measure can be expedited through the two houses it will very soon be proclaimed and the regulations promulgated to assure that the provisions of the bill are available to small businesses just as quickly as possible.


[Stage Direction]
Clause agreed to.
Title agreed to.
Bill reported.

Lionel Chevrier: May I inquire from the house leader what the business will be for tomorrow and the next day?


Gordon Minto Churchill: Tomorrow, following third reading of the bill we have just reported, we will take Bill No. C-45, which was introduced today, to provide for the continuation of the operation of the railways. If that is concluded, then we would continue the debate on the resolution in the name of the Minister of Labour dealing with the subject of technical and vocational training.


[Stage Direction]
It being four minutes past ten o'clock the house adjourned, without question put, pursuant to standing order.

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

Mr. Chevrier: 1.	Does the bilateral air agreement signed in June, 1949, between Canada and the United States, or any amendment thereto, or any exchange of notes arising thereto, authorize a United States air line to fly on a route Toronto-Miami via Buffalo?
2.	Has any United States air line or air lines applied to the government of Canada or to the air transport board for permission to fly the Toronto-Miami route with a stop at Buffalo?
3.	Has any United States air line applied to the civil aeronautics board for such permission?
4.	Is a Canadian air line authorized to fly Toronto-Miami under the United States-Canada bilateral air agreement?
Answer by: Hon. Leon Balcer (Minister of
Transport):
1.	No.
2.	No.
3.	This is a matter which directly concerns the United States aeronautical authorities.
4.	No.


GRADE CROSSING, MEADOWBROOK, N.B.
Mr. Creaghan: 1.	Was a sum of money authorized to be paid from the railway grade crossing fund to be applied
Questions
toward the cost of construction of a grade separation at Meadowbrook, Westmorland county, New Brunswick? If so, when and in what amount?
2.	Did the Board of Transport Commissioners for Canada apportion the balance of the cost of construction? If so, to whom, and in what percentages and amounts?
Answer by: Hon. Leon Balcer (Minister of
Transport):
The Board of Transport Commissioners for Canada advise as follows:
1.	Yes. Order of the board No. 102204, dated August 31, 1960, provided for a grant of 80 per cent of the cost of construction of this grade separation, or the sum of $189,300, whichever is the lesser.
2.	Yes. Order of the board No. 102204, dated August 31, 1960, directed that 5 per cent of the cost of construction of this overhead bridge would be paid by the Canadian National Railways, and that the balance of the cost of construction and the cost of future maintenance would be paid by the department of public works of the province of New Brunswick. The order also directed that 80 per cent of the cost of removing or relocating facilities of the New Brunswick Telephone Company Limited and the New Brunswick Electric Power Commission, or $5,780, whichever is the lesser, be paid out of the fund, with the remainder of such cost to be borne by the utilities concerned.


Wednesday, November 30, 1960