1960-06-20

Mr. Speaker:: Order. If hon. members will permit me, I should like to say on behalf of all members of the House of Commons a word of welcome to a distinguished visitor from India, the deputy speaker of the Lok Sabha, the House of the People of India, Sardar Hukam Singh, who is in the gallery today.



EXTERNAL AFFAIRS


[Stage Direction]
On the orders of the day:
Hon. L. B. Pearson (Leader of the Opposiiion):: Mr. Speaker, I should like to direct a question to the Prime Minister, arising out of a report which I have just seen; therefore I was not able to give him notice of the question. The report is that the British and the United States governments have recalled their representatives on the disarmament commission in Geneva for consultation. In view of developments in Geneva, is the Canadian government asking General Burns to return for that purpose? If so, would it be possible for him to appear before the committee on external affairs to discuss this subject?


Righi Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, there is of course, as the Leader of the Opposition realizes, continued communication in the ordinary way with our representative at that conference. I have no knowledge of any request or desire on the part of the Canadian government for the return to Canada at this time of General Burns. Naturally if it becomes apparent that his presence here would be of assistance in determining any of the questions which may require consideration, a decision in this regard can then be made.


TRANSPORT
[Stage Direction]
On the orders of the day:
Mr. Harold E. Winch (Vancouver East):: should like to address a question to the
Minister of Transport. Has the minister received a telegram from Vancouver expressing serious concern at the decision of the railroads to cease loading any more box cars with grain destined for Vancouver because of fear of a strike, even though the union concerned has not received, and therefore has not discussed, the conciliation board report? Can the minister make any comment on the situation?


Hon. George H. Hees (Minister of Transport):: No, Mr. Speaker, I have not received the telegram. I will inquire whether such a telegram has been received by my office, but I have not seen it myself.



CANADIAN BROADCASTING CORPORATION


[Stage Direction]
On the orders of the day:
Hon. Lionel Chevrier (Laurier):: May I
direct a question to the Minister of National Revenue and ask him whether he has seen this morning's he Devoir as well as this morning's Gazette. The headline in he Devoir reads as follows:
Si Rene Levesque Retourne a R.-Canada, Nous Fonderons Notre Radio du Quebec!
"If Rene Levesque returns to the C.B.C. we shall establish our own radio station in Quebec." Has the minister any comment to make on that statement made by the premier of the province of Quebec?


Hon. George C. Nowlan (Minister of National Revenue):: I have not seen either paper, nor have I read the statement to which the hon. member refers. I will do so today and give him an answer tomorrow.


Lionel Chevrier: I should like to ask another question. I will send the statement to the minister. According to present radio and television regulations, would the board of broadcast governors be justified in granting a licence to a provincial government to operate a provincial radio and television network on the sole ground that the provincial government does not like certain individuals appearing on C.B.C. programs?


George Clyde Nowlan: This is a legal question which I am not prepared to answer at the moment, but I am certain that the board of broadcast governors would not make any judgment one

Inquiries of the Ministry way or the other based on personal predilections or opinions or prejudices.


Lionel Chevrier: May I ask a final question which the minister can perhaps answer when he answers the first one. Would he inquire whether the government of the province of Quebec has made an application for permission to set up a radio and television network to replace the C.B.C.?


George Clyde Nowlan: Such an application, as the hon. member knows, would have to go to my colleague the Minister of Transport, to be approved by that department before it would come before the board.


Lionel Chevrier: Then may I direct the question to the Minister of Transport?


George Harris Hees: I have no knowledge of any such application.



INDUSTRY


[Stage Direction]
On the orders of the day:
Hon. Paul Martin (Essex East):: May I ask
the Prime Minister if he is in a position to report to the house following his conference on Friday last with the heads of the Canadian automobile industry regarding conditions in that industry?


John George Diefenbaker: Mr. Speaker, I met with representatives of the automobile industry, Mr. Walker, Mr. Sale, Mr. Todgham, Mr. Grundy and Mr. Dykes of the Canadian automobile chamber of commerce, and following their discussions with me they met with the Minister of Finance and possibly one other-


Paul Joseph James Martin: The Minister of National Revenue.


John George Diefenbaker: The Minister of National Revenue. I am not sure that there was not another minister as well. They raised a number of questions, particularly with reference to values for duty. In that regard I may say that a study is going on with respect to the values for duty placed on automobiles, and discounts on the values of imported cars. These studies, of course, are in accordance with the usual practice of the Department of National Revenue. In addition they made representations regarding the tariff on automobiles in the United Kingdom. They pointed out that while automobiles exported from the United Kingdom to Canada came in free, there was a duty on imports from Canada into the United Kingdom, and they asked that consideration be given to this particular problem as well to the end that equality in this regard be established.



BILL OF RIGHTS


[Stage Direction]
On the orders of the day:
Lionel Chevrier: I wish to direct a question to the Prime Minister in view of the statement made by the premier of Quebec as reported in Le Devoir of this morning, which I have sent over to his colleague the Minister of National Revenue and which reads as follows:
Each time a reporter will make an accusation, he will have to prove it and to give his sources of information. He will have to prove his accusation or to apologize.
The question is this. Can the Prime Minister tell the house whether that statement is compatible with the bill of rights introduced in the house in September of 1958 and designed to ensure-


Mr. Speaker:: Order.


Lionel Chevrier: -freedom of the press.


Mr. Speaker:: I do not like to interrupt the hon. member, but it seems to me that the question is not an appropriate one for the orders of the day. We have standing on the order paper a bill of rights-


Lionel Chevrier: No, Mr. Speaker.


Mr. Speaker:: It has been forecast.


Lionel Chevrier: May I be heard on this point?


Mr. Speaker:: I expect there will be a debate, but the subject matter which the hon. member raises seems to be more a matter of the administration of the law than of the administrative responsibility of the Prime Minister.


Lionel Chevrier: I should like to be heard on that point, Mr. Speaker, if I may. My point is this. While the Prime Minister announced some days ago-one day last week, I think it was-that it is the intention to introduce certain legislation with regard to a bill of rights, it has not yet been introduced. Here we have a statement made by the premier of a province, a statement that contravenes the very intent of the bill of rights. It would strike me that the question is quite within the rights of a member of parliament to ask, having regard to the circumstances under which the statement was made.


Mr. Speaker:: I am sorry, but I do not agree with the hon. member. In substance his question is this: would the bill of rights, if it were passed by this house and by parliament, have a certain effect? To ask even whether the present law would have an effect

on the matters raised by the premier of Quebec would be asking for a legal opinion, and in my opinion the question is not a proper one for this period.



TIMMINS, ONT.    INQUIRY AS TO DECISION ON REQUEST FOR ASSISTANCE

[Stage Direction]
On the orders of the day:
Mr. M. W. Marlin (Timmins):: I should like to direct a question to the Prime Minister. Can the Prime Minister inform the house whether any decision has yet been made with regard to the request of the Ontario government for financial assistance for the victims of the flood in Mount Joy township?
High! Hon. J. G. Diefenbaker (Prime Minister):	The information I have, Mr. Speaker, is that no decision has yet been reached.



IMMIGRATION


[Stage Direction]
On the orders of the day:
Hon. J. W. Pickersgill (Bonavista-Twillin-gale):: I should like to ask the Prime Minister whether he has made any arrangements for a delegation of representatives of the Chinese Canadian community to present a brief to him as head of the government.


John George Diefenbaker: I think I answered that question a week or so ago, Mr. Speaker, and said that consideration has been given to a meeting in this regard and that I would be available at an appropriate occasion convenient both to the delegation and to me.


John Whitney Pickersgill: Perhaps I could ask the Prime Minister a supplementary question. Was the Prime Minister aware of the fact that over the week end there had been a meeting of representatives of the Canadian Chinese community from all over Canada, and that there was an announcement to this effect on the radio this morning?


John George Diefenbaker: An announcement to
what effect?



HOUSING


[Stage Direction]
On the orders of the day:
Hon. D. J. Walker (Minister of Public Works):: In reply to the hon. member for Nipissing (Mr. Garland) who on Friday last in my absence directed to the Prime Minister 79951-0-323
20, 1960	5111
International Development Association a question as to whether or not Central Mortgage and Housing Corporation would consider making more money available for direct loans, may I reply that as and when any decision in this matter is made by the government, or if the government decides on any change whatever, an announcement will be made to the house.



INQUIRY AS TO ACTION TO AVOID DISCRIMINATION

[Stage Direction]
On the orders of the day:
Paul Joseph James Martin: May I ask
the Minister of Public Works whether he has yet received from the Department of Justice any formula which would avoid discrimination under the housing legislation which he promised some time ago he would see would be looked into?


David James Walker: Mr. Speaker, I am glad to have that question from the hon. member for Essex East. We are at this time, and as a matter of fact were on Friday last, discussing with the Department of Justice and the deputy minister the question which perplexes us all and to which we would like a solution.



INTERNATIONAL DEVELOPMENT ASSOCIATION


Hon. Donald M. Fleming (Minister of Finance) moved: that the house go into committee to consider Bill No. C-70, respecting the International Development Association.
Motion agreed to and the house went into committee, Mr. Flynn in the chair.
On clause 1-Short title.


Mr. Macdonnell:: Mr. Chairman, I was a member of the committee which unanimously approved this bill. I might say that this unanimity is not always present in the committee, the members of which include the hon. member for Bonavista-Twillingate and the hon. member for Essex East, but in this case there was unanimity.
My purpose in rising is to express my satisfaction at what the government has done and also to try to put on record certain views, including certain statements by witnesses and people whose opinions are of value, so that these may be useful to those who will continue to assist the government in creating a stronger and stronger feeling toward our duties and responsibilities in assisting underdeveloped countries. In this connection I am hardly bold enough to hope I can interest the press. One of these days somebody will come along who will be of interest to the press, but
5112	HOUSE OF
International Development Association I shall put the evidence of these witnesses on record in the sincere belief that it will be useful.
First of all I would like to go to our own Prime Minister, one of the world figures of today, and quote a statement I quoted some time ago. The Prime Minister, has said:
Economic assistance to underdeveloped countries is a major and mandatory need if freedom is to be preserved in the world.
Then I was delighted to observe the other day that while the Prime Minister was attending DePauw University he followed up that statement with this one, and I quote briefly from his words on that occasion. He gives certain statistics, and then he says:
I do not need, in view of these statistics, to underline the arguments for sacrifice on the part of the industrialized countries in the field of economic assistance-
Then finally he says:
There is no alternative to continuing with, even increasing, this type of international assistance and co-operation. Until the day comes when the less developed nations expand their capacity to trade and achieve self-sustaining growth, there is an unanswerable argument in favour of assisting them. It was with this argument in mind that, at the recent meeting of commonwealth prime ministers in London, it was decided to begin work on a program of economic aid to the emerging nations of Africa, the largest remaining area where International assistance has yet to be launched on a scale remotely consistent with present and future needs.
It has been made quite clear in the press that our own Prime Minister was a leader in connection with this movement for aid to Africa, and I am glad to think that is so.
I should like to quote briefly from a pamphlet by Paul Hoffman which I commend to all members, which is called "One Hundred Countries, One And One Quarter Billion People". In the first place he draws attention to what I feel is a very important point, namely-


Paul Joseph James Martin: On a point of order, Mr. Chairman; I think the hon. member who is now speaking ought to be accorded the courtesy which his sense of responsibility and the seriousness of this matter warrant. We ought to have the opportunity of hearing what he has to say.


James MacKerras Macdonnell: I am grateful to the hon. member, I can assure hon. members that what I am saying is just as dull to me as it is to them. I quote from Paul Hoffman, who has this to say:
There was a time not long ago when, everywhere in the world, resources were for the most part exploited rather than developed.
Then he goes on to say this:
These attitudes and practices have changed markedly. Exploitation is widely recognized as shortsighted and self-defeating.


Not long ago, it was unquestioned that "the poor are always with us," and poverty of the majority of the people in any country-and certainly in the world-was regarded as inevitable, to be alleviated, as far as possible, through charity. Only in the last 30 or 40 years have even the most advanced countries of the west accepted that a national society, operating through government, has the responsibility for creating conditions which spur economic development within its borders, relieve poverty, and raise the standard of living of all classes in the population.
Today they are discovering that the same principles and similar methods work on a world scale, and that they yield similar beneficial results.
Then I shall quote a word or two from Mr. Hoffman dealing with his own proposal:
My proposal is this: That we-all of us together- fix it as our goal to double in the 1960's, as compared with the 1950's, the annual per capita rate of economic growth in 100 countries and territories containing a billion and a quarter of the world's people. If we achieve this goal it will mean increasing the per capita economic growth rate of the less developed countries from an average of 1 per cent a year in the 1950's to an average of 2 per cent in the 1960's.
You will see that this is a rather modest objective he sets. Then I wish to quote what Hoffman has to say about the subject we are discussing now, that is the international development association. He speaks very warmly about it:
A splendid first virtue of the proposed I.D.A. as an instrument for promoting economic development in the low income countries is that it will be a genuinely co-operative undertaking comprising, as members, both industrialized and underdeveloped countries. All members will make contributions; all will have a voice in the truly international administration that will result.
I should like to accentuate as best I can the fact that Mr. Hoffman and other competent people who have been close to this question stress again and again that this is a matter of investment and not charity; that the nations requiring assistance have to take the initiative themselves, in effect have to become creditworthy. It is not just the question of dishing out money to undeserving people, but a question of assisting people to help themselves. I continue:
A second great virtue of the proposed I.D.A is that, inasmuch as the world bank has gained universal renown as an efficient and effective and objective international financial institution, I.D.A., as an affiliate of the world bank, will borrow its accumulated experience, knowledge, and expert direction.
A third virtue of I.D.A. is that it is not required to confine its loans to support of specific projects, but may extend its support to plans and programs that support economic development.
This outstanding man is known to most hon. members. He is the man who administered the Marshall plan which was such a brilliant success. He goes on to say:
There is, nevertheless, a major shortcoming in the international development association as currently projected:

The authorization planned for I.D.A. is only $1 billion. One billion dollars over five years! This is obviously too little to come anywhere near meeting the minimum investment gap of $2 billion a year. And yet, there is no other institution either in existence or on the drawing boards that can take up the slack!
For this reason I welcome the fact that in the bill it is proposed that the amount contemplated shall be reviewed and, if necessary, increased. Here we have the statements of Mr. Hoffman, who has worked very hard to find out what is required. He strongly praises the I.D.A. but points out what is required.
I should like now to quote from a statement made by Adlai Stevenson which appeared in the magazine Foreign Affairs of January, 1960. I shall quote two short paragraphs from Mr. Stevenson's most interesting article:
To me the two most dangerous realities we now face are the multiplication of nuclear weapons and the disparity in living standards between the rich nations and the poor.
I will not read further from -that section of his remarks but I wanted to bring that sentence to the attention of hon. members. Further along he writes:
The average annual income in the United States is more than $2,000 as against less than $100 for a third of the world's population. And the worst thing about this disparity is that the rich nations are getting richer and the poor poorer.
That is the opinion of a man with a world reputation. I think it is full of practical good sense. I like to remind myself that he is not merely a man of good common sense but was also the good governor of one of the largest states in the United States. He goes on to speak about figures:
Happily, there is, at long last, a growing realization here and among our friends that these are the decisive areas and that we must assist the underdeveloped peoples to advance to self-sustaining growth while preserving their independence and some hope of evolving a political democracy. Without an alternative to communist methods of development, we face grim prospects indeed in poor countries where literacy is low, hunger high and the gap between resources and population widening.
I wish to read just one sentence of a speech made by Mr. Eugene R. Black at Oxford University on March 3 last. He is the banker who has lent some $5 billion on business terms without loss. In one paragraph he outlines the responsibility that must be taken by those who wish to benefit. He says, for example:
How important it is to develop a pride of workmanship so that every ounce of resources available for promoting higher material living standards is used as efficiently as possible.
I hope that will convey to every hon. member an idea of the responsibility that he is laying on the underdeveloped countries.
79951-0-323J
International Development Association He then goes on to utter a sentence every word of which I commend to hon. members.
And how important it is that the free world community stand ready to pledge whatever measure of its wealth can be usefully absorbed in this endeavour.
He is not asking us to waste our money but to pledge whatever measure of wealth can be usefully absorbed in this endeavour. Mr. Black is a hard-headed banker and I suppose knows more about these world-wide problems than any other man on the planet. I remind hon. gentlemen of the contribution Mr. Black made to the solution of the problems of the Indus waters.
I wish now to quote a sentence or two from a well-known writer in the London Economist; Barbara Ward, one of the most brilliant people living. She made a statement which I think really puts us on the spot. If we agree with it then we must do something about it. If some do not agree with it, that is their privilege. This is what she said:
As the world enters the 1960's, one fact seems sure. The pace of revolutionary change, in every sphere of human affairs will gather momentum.
The breakthrough accomplished in the fifties in weapons, in space research, in every type of scientific advance; the political breakthrough of a score of new nations; the emotional breakthrough of a third of humanity hungering for economic growth -all these forces will expand explosively to make the sixties a period of challenge and change unequalled in human history.
What, in these circumstances will be the response of the western powers? The answer depends not only upon the new political leadership available in the west, it depends profoundly upon the sort of people the free nations have become as they face the mounting crises of their age.


Paul Joseph James Martin: The hon. member does not identify his quotation. Is that from her lectures at the University of Ghana?


James MacKerras Macdonnell: That statement is from the New York Times of December, 1959. I should like now to make a brief reference to a remark made by a man who I believe is familiar to us all, Sir Douglas Copland. He was the Australian representative here for years. In a proposal reported in the Globe and Mail of June 8, 1960, he stated:
Canada and Australia should give leadership in assisting underdeveloped countries.
Thank goodness we in Canada have given some leadership. Then he went on to speak about the question of trade. Hoffman has very strongly made the point that aid makes trade. That is a point which Hoffman underlines. Sir Douglas Copland goes pretty far in referring to the subject. He suggests:
There is no reason-why the western world should not contribute perhaps 1 per cent of its national income to underdeveloped countries.

International Development Association
Some people will think that is a lot. The statement to which I really wish to direct hon. members' attention is this:
To some people a suggestion that 1 per cent of national income should be set aside as a contribution to underdeveloped countries will be regarded as a cost. This is far from being the case. It should be regarded as an investment from which the return will be very high.
I think it is terribly important for us to understand that. If we believe that statement it will take us a long way.
I will read another short paragraph from Hoffman which I think is full of practical good sense.
The expression "trade and aid," which is used so often these days, conveys the subtly misleading impression that "trade" and "aid" are separate entities, that they might be mixed in varying proportions in promoting development in the low income countries, and even that one might be substituted for the other. This is, of course, false. Aid is trade. Investment is trade. The dollars or pounds or francs or marks that are expended on foreign aid and investment in the low income countries are only symbols representing food, textiles, metals, machinery, and other manufactures produced in the industrialized countries and exported to the developing countries, and technical services made available to them in support of their development. Aid and investment abroad is therefore more than trade; it is production and employment both in the investing and in the recipient countries; and it is economic growth and increased prosperity all around.
Once we get this idea fixed in our heads, we can banish the idea that aid to and investment in the underdeveloped countries is charity or that it is a one-way street.
I commend those words to hon. gentlemen. I might say that this pamphlet is available, and I suggest that everyone should read it. It is packed full of practical good sense from a man who without exaggeration has to his credit the fact that he set western Europe on its feet.
I am almost finished now, Mr. Chairman. I wanted to put forward these things which I have read to you. I suggest that people have a choice. Needless to say, those people to whom I have referred know what they are talking about. It is not a lot of hooey but sober practical common sense. If you believe these things then the answer is you have to do something about it.
We have done something about it. I read to you what Mr. Hoffman said in welcoming the I.D.A., suggesting that that is what is implied in the act itself, because he leaves the door open for additional funds. I suggest that these words are weighty words. I suggest that what Barbara Ward said about those explosive questions facing us in 1960 is a simple statement of fact, and if it is a simple statement of fact we cannot run away from it. I suggest that in the past this nation to which we belong, when it has been faced

with something that was regarded as a real emergency, has always stood up to it.
I do beg that you who are leaders in your communities, who are here responsible for legislation, who are approving this legislation, which is a fine step in the right direction; having heard the words of our own Prime Minister and of other people; having heard the words of those practical men who have been doing things in this matter; having heard what to me was a very good idea, that exploitation is receding and investment developing may not remain inactive but may do something about it.
I was anxious to bring these things forward. I hope the witnesses I have called and their words may carry much further than mine. If they do, I have not wasted your time.


Mr. Thomas:: I should like to lend my wholehearted support to the efforts of the hon. member for Greenwood in creating public interest in this matter of support for underdeveloped countries. I do not wish to take up the time of the commitee except to assure the hon. member for Greenwood and this committee that my support is with him.


Mr. Regier:: All I want to say at this time in support of the bill is to place on record the fact that while we are asked by the terms of this bill to authorize Canada's participation to the extent of $37.83 million, under the articles of agreement of the international development association our obligation initially is going to be only 10 per cent of our initial subscription. In other words we are obligated to spend within the next number of months only the sum of $3,783,000. We cannot let the people of Canada believe that we are now investing $37.83 million in this field of international aid. All we are doing is investing $3,783,000. Then we have about an equal amount which is payable one year later, and another similar amount one year after that. I feel that, much as we welcome this move, it should not be misunderstood by the Canadian people that we are immediately about to invest $37.83 million, because the articles of agreement allow us a goodly number of years in which to pay our full original subscription of $37.83 million.
When he replies, I should like the minister to indicate whether there has been any approach made in the evolution of this organization to obtain the co-operation and the participation of nations behind the so-called iron curtain. I feel it most regrettable that in the matter of international aid we are continuing to grant this aid as a western bloc, while the countries behind the iron curtain are granting their forms of aid in their own way. If the word "international" in the bill means anything at all it ought to

mean that this is international indeed. I regret that political implications are involved and are being used in so many of our international aid programs. I should like to have a little bit of an accounting on whether any of these countries have been asked to participate-I mean the so-called iron curtain countries-and what their reaction has been.


Lester Bowles Pearson: Mr. Chairman, I wish to say just a word on behalf of our party in support of this bill, which was given very careful and sympathetic consideration in a committee of this house. Although I was not a member of that committee I have had the opportunity of reading the record of its proceedings and, as my hon. friend from Greenwood in his very constructive and thoughtful observations of a few moments ago pointed out, in respect of this matter there seems to be unanimity in the house.
The purposes of the bill are such, of course, that they must, I think, commend it to all of us. The committee report quotes Mr. Ras-minsky, who is familiar with these matters, as having stated its purposes by reading article I of the bill, namely that:
The purposes of the association are to promote economic development, increase productivity and thus raise standards of living in the less-developed areas of the world included within the association's membership.
At one time there were those who had some hesitation about the possibility of realizing these purposes through this association without causing some overlapping or some confusion and, indeed, without having some result of which we in Canada perhaps would not entirely approve. However, I think the justification for the association has been the great difference between the loans that are to be made under this association and those made by the bank itself. As was pointed out by Mr. Rasminsky and, indeed, as has already been pointed out by the minister, the terms would be somewhat easier in connection with loans under the I.D.A., and therefore loans could be made for economic development under the I.D.A. which perhaps should not be made under the bank as it is constituted at present. I think that does indeed justify the establishment of this association.
The hesitation which I know members of the government may have had when the association was first put forward have been removed in a way which Mr. Rasminsky and the minister have already pointed out. Particularly there is the hesitation and doubt once felt-and perhaps we may also have some questions to ask about this when we deal with the clauses of the bill-about the possibility of using this fund for United States surplus disposal programs in a way which
20. 1SS0	5115
International Development Association we could not support. That is one doubt which was very much in all our minds at the time and which, so far as the government is concerned, has been removed.
The purposes of the bill, as I have said, are such that they commend themselves to all of us. They represent a further effort to meet what the hon. member for Greenwood has just referred to as a major and mandatory need. In the efforts that are being made internationally to meet this need, I think the time has come when we have to be careful that we do not proliferate our international agencies for this purpose. We have a good many now, and perhaps we should be more careful in the future than we have been in the past about relating the work of all these organizations, international in scope under the United Nations and under the Colombo plan arrangement, so as to make sure that they do not get in each other's may.
The need is great and, as the hon. member for Greenwood has pointed out, the need is not decreasing but increasing. I think he quoted that figure that Adlai Stevenson put forward in a speech not long ago of a requirement of $5 billion a year by way of assistance from what we call the developed countries to meet the needs of economic development in what we call the underdeveloped countries. The gap between the developed countries and these underdeveloped countries is not lessening in this respect but is widening. In other words the need is growing, not diminishing, in spite of the acceptance of reponsibility by the developed countries to do what they can to meet that need. That in itself is an encouraging development, because I think this is the first time in history that the more fortunate nations have accepted formally, through international organizations, a responsibility for helping the underdeveloped and less fortunate countries.
But the need is great and is increasing. I read not long ago-I think I am right in my memory of the figures-that. the per capita increase in the national income of the United States over a recent period of a few years- I cannot remember the exact period-was greater than the total per capita income of many of the Asian and African countries. We are perhaps falling behind in meeting this necessity rather than gaining in meeting the requirements that are before us. In other words, we are falling behind in the race between resources and existence in so many countries.
The purposes of aid are, of course, just as important as the aid itself. That is why it is of such great importance to have aid of this kind, whenever possible, given under the United Nations where the political fears, suspicions,
5116	HOUSE OF
International Development Association pressures and influences just referred to need not exist. Surely aid under the United Nations should be above suspicion. When the hon. member for Burnaby-Coquitlam talks about the undesirability of any political strings being attached to western aid he is, of course, quite right; but aid under the United Nations does not and need not have these suspicions associated with it.
While all countries in the west may not be above suspicion in these matters, surely the record of the west and the record of the United States in what has been done to help meet these needs bear comparison not only in quantity but in purpose and in manner of distribution with the aid from the U.S.S.R. and countries behind the iron curtain. I know there have been some instances where aid from the U.S.S.R. has been very carefully proposed and as carefully administered to give the impression that there was no political purpose attached to it in any way, shape or form. That has happened in some cases, but in other cases the connection between politics and aid from the U.S.S.R. has been open and blatant.
I am thinking particularly of the help the U.S.S.R. once gave Yugoslavia. Immediately Yugoslavia refused to buckle down to Soviet foreign policy, that aid was cut off without a trace. So while it is desirable to remove from aid any political purposes of the kind that have been mentioned, I think this kind of proposal does just that. If the Soviet union and its friends criticize the United States, particularly, for tying up aid to political purposes, even under the United Nations, it should not be forgotten that any time the Soviet union so desires it can join in this kind of United Nations activity. So far it has not shown much desire to do so. Perhaps that is the most effective commentary on the criticism which we do get at times from the U.S.S.R.
The question of keeping international aid out of politics has a bearing on whether it should be in the form of grants or in the form of loans. That is why there is a good deal to be said for increasing our aid of this type under the development association and under the world bank in contrast to direct grants, some of which, while no doubt welcomed by the countries receiving them, do carry with them a kind of stigma of charity which no self-respecting people wish to have attached even to the kind of help they are getting from countries like our own. Therefore this kind of assistance under the international development association has that to commend it. It is the kind of assistance that could not be criticized on any of the political grounds mentioned this morning.


I think that is all I need to say now, Mr. Chairman. When we come to detailed discussion of the bill we may have some questions to ask. Meanwhile I want to repeat what the hon. member for Essex East has already said on second reading, that we are wholeheartedly behind the purposes of the bill, that we think it is well designed to carry out these purposes, and that this is a very appropriate contribution for Canada to make.


Donald Methuen Fleming: Mr. Chairman, I thank hon. members for what they have said concerning the bill and for the unanimous expressions of support for the measure which have been heard at all stages.
There were only three matters raised that I think call for specific comment at this point. With regard to the point raised by the Leader of the Opposition as to the possible use of counterpart funds, I simply refer to article III and particularly section 1 of the articles of association in that regard.
The hon. member for Burnaby-Coquitlam raised two points. The first related to the terms of payment. Canada's subscription to the international development association is $37,830,000 in United States funds, and that is the amount which the bill will authorize the Minister of Finance to provide out of the consolidated revenue fund.


Paul Joseph James Martin: The minister referred a moment ago to an observation made by the Leader of the Opposition and directed our attention to article III, section 2.


Donald Methuen Fleming: Article III, especially section 2.


Mr. Benidickson:: The minister said section 1.


Donald Methuen Fleming: Especially section
2.
The terms of payment of the subscription are set forth in article II, section 2. Under its provisions 10 per cent of the initial subscription of each original member shall be payable in gold or freely convertible currency in the manner set out. Payment in full, of course, is not required by the association at the beginning. It is not necessary that it have all subscriptions paid in full, and that is the reason that the articles make provision for payment over a five-year period.


William Moore Benidickson: Of the 10 per cent?


Donald Methuen Fleming: No. If the hon. member will let me finish I think it will be clear. The subscription in the first year is 23 per cent and in each of the four subsequent years 19| per cent of the aggregate amount.

The other point raised by the hon. member for Burnaby-Coquitlam concerned the possibility of countries behind the iron curtain joining the international development association and becoming members of it. Only members of the international bank are eligible for membership in this new association, and none of the countries behind the iron curtain has chosen to become a member of the international bank. I might point to the list of countries eligible for membership in the international development association, and that list appears in schedule A on page 23 of the bill. It will be observed that Yugoslavia is one of the countries mentioned in part II of the bill, but no country behind the iron curtain is eligible unless it first becomes a member of the international bank.


[Stage Direction]
Clause agreed to.
On clause 2-Articles of agreement approved.
Paul Joseph James Martin: There is a point or two I should like to make, not that there is any issue between the minister and those of us sitting on this side on what I have to say, but because it is important and one wants to give further emphasis by way of putting it into the record. When I spoke on second reading of this bill I called to the attention of the minister and those concerned the fact that the international development association might be used by the United States to further its surplus disposal program. The minister observed that that was, of course, not the intention and that the articles of agreement, as now worded, precluded that possibility. I agree with the minister that an interpretation of the revelant articles do not warrant the use by any country of its surplus disposal program in a way that would contravene the intention of this institution.
In the committee, Mr. Rasminsky was questioned by hon. members, including myself, on this point. He stated that when the matter was in the discussion stage, speaking on behalf of the government of Canada he did observe that he would not want to see the international development association operate as a kind of adjunct to the surplus disposal program of the United States. He also pointed out, of course, as is the case, that anything that was said in those meetings by anyone on behalf of any country did not have the effect of law any more than a debate in this house, in connection with legislation, is in itself an expression of the law and so recognized by the courts. Mr. Rasminsky also assured us that the point of view he expressed was a point of view that had been shared by the other directors. Then he called our attention to some commentary made in the special
20, 1960	5117
International Development Association report of the national advisory council, to which I had directed the attention of the house and also the committee when this matter was discussed in the latter place.
My concern was with regard to the letter of transmittal by the President of the United States to the congress in which he used language that, in my judgment, was open to an interpretation not consistent with what I believe the articles of agreement specify, and certainly not open to the interpretation which the minister has given us with respect to the intention of all the parties.
I simply rise at this time to call attention to what Mr. Rasminsky said in that connection, to note especially his comment with regard to the letter of transmittal by the President of the United States, and to place alongside that letter the actual reference to the national advisory council which will be found at page 25 of the evidence before the banking and commerce committee on June 14. If, in the future, the United States or any country should use this agency to further its surplus disposal program in a manner that would be inimical to the interest of this country-I say this because of past situations -that would be a clear violation of this agreement to which Canada is now being asked to extend ratification.


William Moore Benidickson: May I draw to the attention of the hon. member for Essex East the reference he has just made to page 25 of the banking and commerce committee report which deals with this bill. I find that immediately before the reference he made there is a misprint in the evidence of the committee, in that to find the quotation that was given on second reading of the bill by the hon. member for Essex East, one does not go to page 4331 but to page 4631 of Hansard.


Paul Joseph James Martin: I thank the hon. member.


Donald Methuen Fleming: As hon. members are aware from the discussion both in the committee and during previous public references to this matter, this question of the possible use of counterpart funds acquired by the United States through its agricultural surplus disposal activities was one that gave the Canadian government some concern. In speaking on behalf of Canada at the annual meeting of the governors of the international bank in Washington last autumn I stated our concern in that respect. Mr. Rasminsky referred to my statement and quoted it in his testimony before the committee on June 14. Steps have been taken in the drafting of the articles, during the meetings which occurred in the autumn and winter, to deal as effectively as was possible with this problem.
5118	HOUSE OF
International Development Association
The article which contemplates the possible use of such funds is article III, which is divided into two sections. The first section deals with additions to the resources in the form of additional subscriptions. Additional subscriptions may be made under decision of the association only by a two thirds majority of the total voting power.
Section 2 of this article deals with the provision of supplementary resources by a member in the currency of another member. This is the provision under which it might be possible for a country like the United States, holding a substantial amount of currency of other countries, to seek to offer these sums in foreign currency to the association for its use. I point out that such sums could only be accepted in that case by a decision of the association. That decision would not require a two thirds majority, but a simple majority in the ordinary way. No country has a right to make additional subscriptions to the association merely by turning over large sums of foreign currencies which it holds. This can be done, I emphasize, only by a decision of the association itself. The acceptance of such funds by the association does not give any additional voting rights to the country that has subscribed this foreign currency. It gives it a right, in that event, only to receive a special development certificate.
Then there is a further safeguard in subclause (c) of section 2 which reads:
Nothing in this section shall preclude the association from accepting resources from a member in its own currency on such terms as may be agreed upon.
I stress the fact that the matter is left under the control of the association. The United States subscribes, in round figures, about 32 per cent of the total capital. In so far as what is likely to happen is concerned, I think that is best summarized by Mr. Rasminsky in that passage of his testimony recorded on page 25, which followed the quotation to which the hon. member for Essex East referred concerning the statement by the national advisory council. Mr. Rasminsky followed with this statement:
I would not say that was an enthusiastic statement of possibilities. X cannot guarantee, of course, that the American hopes and aspirations are the same as ours in this connection, but against the background of the whole record of these discussions I think that the management of the institutions will be quite cautious about bringing proposals forward regarding these supplementary contributions.
I think it is quite clear that if any proposal is made to ask the association to accept counterpart funds in pursuance of section 2 of article III, the Canadian representative would wish to give such proposals very strict scrutiny.


William Moore Benidickson: In addition to the safeguards referred to by the minister just now, my recollection is that in his testimony Mr. Rasminsky placed a great deal of weight and importance in this regard upon article III, section 2, subsection (a), particularly the stipulation that even the association shall not enter into any such arrangement unless the association is satisfied that the member whose currency is involved agrees to the use of such currency. Does the minister not attach considerable weight to that stipulation?


Donald Methuen Fleming: I fully agree with that statement. I intended to mention that matter. It is another safeguard that the country whose currency is held in the form of counterpart funds must agree. It might have strong objection to enter against any attempt on the part of the country holding its currency in counterpart funds to turn it over to the international development association for use. It might seriously affect the value of its currency, all its fiscal and trade plans and indeed its monetary plans. As the hon. member for Kenora-Rainy River has pointed out, this is another important safeguard in this respect.


[Stage Direction]
Clause agreed to.
Clause 3 agreed to.
On clause 4-Payment of subscription out of consolidated revenue fund.
Erhart Regier: I should like to ask the minister why the clause allows him to make payment only in line with the articles of agreement. I can easily imagine that a year or two hence the international development association might see adequate use for all its authorized capital. Yet as I read this particular clause the minister would not have any authority to pay out the remaining unpaid portion of the Canadian subscription, because he has legislative authority to pay only in accordance with article II of the memorandum of agreement. Would the minister not be more useful to the aims of the international development association if this particular authority for which he is now asking would grant him permission to pay out the whole of the Canadian subscription at any time the governor in council deemed it advisable to do so? After all, it is not a great deal of money; it is $37 million. Yet the terms of article IV place the minister under a handicap, or they might place him under a handicap.


Donald Methuen Fleming: All hon. members will appreciate the fact that parliament cannot change the articles of the association. We can decide whether or not Canada will become a member of the association. The terms

on which Canada has the opportunity of becoming a member are to be found in the articles of the association. All we can do is ask parliament to approve of Canada's adherence to the association on the terms set forth in the articles of association.
What the hon. member has in contemplation would, it seems to me, involve a change in the articles of association, and that matter would have to be dealt with in the light of the amending procedure contained in the articles of association themselves. If the articles were to be changed in any way that involved a change in the terms of payment that parliament has authorized, then it should be brought back to parliament for parliament's decision.


Erhart Regier: I hope I did not misunderstand the minister. Does the minister mean to say that if Canada immediately paid its whole subscription, Canada would be violating the terms of the international agreement?


Donald Methuen Fleming: I would rather put it the other way and say that we would be going beyond the terms of the agreement or the terms of the articles of association.


William Moore Benidickson: Both in the debate in the house and in committee the minister made some reference to certain misgivings he originally had when this proposal reached the Canadian government; and at these international meetings he was the senior delegate representing Canada. This matter was not elaborated on too much in our original debate, and I asked Mr. Rasminsky to try to summarize for the committee on banking and commerce what were the principal misgivings of the Minister of Finance. In reply Mr. Rasminsky indicated that one of what he called the preoccupations of the Minister of Finance, when these discussions took place, was the possibility that use would be made of local currencies by the bank and that this might lead to inflation. I take it that this is the article in the agreement upon which the government relies in the belief that this misgiving or this preoccupation to a considerable extent has been eliminated or reduced; and I take it that the reference is to this phrase, that the use of currencies must be "consistent with sound monetary policies", something of course would be determined by the board of the association.


[Stage Direction]
Clause agreed to.
On clause 5-Annual report.
Paul Joseph James Martin: I want to ask a question on this clause. Before doing so, however, I should like to say to the hon. member for Greenwood-and I neglected to do so when I spoke a moment ago-how
20, 1960
International Development Association greatly we were all impressed by his remarks. The hon. gentleman who is one of the senior and most respected members of the House of Commons, has all his life had a great interest in international problems. As a businessman and now as a member of parliament he has displayed an intelligent interest in the means by which we believe it is possible to remove the tensions that exist in the world. The speech he made this morning is the kind of contribution we would have expected from a man who has interested himself in these matters for such a long time.
I should simply like to ask the Minister of Finance whether he can tell us what countries under part I have taken the necessary steps, pursuant to their constitutional requirements, to ratify or adhere to these articles of association; and likewise, what countries under part II have taken the necessary steps in this regard.


Donald Methuen Fleming: I have not full information on that point. Naturally this question is engaging the attention of a good many countries at the present time. When I spoke at the resolution stage on June 7 I referred to the steps that have been taken by several of the principal countries in the light of their normal constitutional procedures in this respect. The hon. member will find that at page 4627 of Hansard, the first column. I said: The agreement will not come into force until it has been signed on behalf of the governments whose subscriptions comprise not less than 65 per cent of total subscriptions. Many of the main potential contributors have already initiated the legislative action necessary to allow them to become members of the association. In the United States the Senate has already approved the legislation; the banking and currency committee of the House of Representatives has also approved it and the legislation is expected to go before the house some time this week. In the United Kingdom I understand from our latest information that the second and third readings of the bill have been completed in the House of Commons and the second reading in the House of Lords. In Australia the legislation has received royal assent. In other countries, such as Germany, France and Norway, legislative action has also been taken.
My subsequent information is that in the United Kingdom the bill has now passed both houses and has become law.


Erhart Regier: I know the minister is interested in this part of the bill, but I regret to say I very often notice that within a week or so after the estimates of a minister have been passed in this house we get an official copy of the latest annual report which is a lot more up to date than the one available to members of the house at the time it is considering the estimates of that minister. In this regard I hope that when the minister is asked, as he is here, to prepare a report of operations under this act, he will ensure that whenever his annual estimates appear
5120	HOUSE OF
International Development Association before this house we will have as recent an annual report as it is possible to have, and that we will not receive a later one just a few weeks after the passage of the estimates.
However, what I rose to say was that I would like to ask the minister exactly how members of this house are able to obtain information as to what happens in regard to a matter of detail when an international organization such as the one of which it is now proposed we become a member has its meetings. I have reference, for instance, to meetings which are being held under the Colombo plan. I am particularly interested in what happened in the case of Canadian participation in the reactor which we helped to build under the Colombo plan. I would like to look at the minutes of a meeting which was held in Bombay on a certain date by officials of the Colombo plan in which Canada's participation was involved.
How are members of this house to obtain information? I think even the minister will admit-and being a Conservative I think he will readily agree-that an international agency can very easily remove itself from real democratic control and efficient supervision. Therefore how are members of the legislatures of participating countries to equip themselves with the necessary information in order that a proper observation can be made of the activities of these international organizations?


Donald Methuen Fleming: First of all, Mr. Chairman, if I correctly followed the remarks of the hon. member with regard to the annual report, he is confusing two kinds of reports. The report which is contemplated by clause 5 of the bill is a report by the Minister of Finance to be tabled in the house as provided. In this respect the present bill follows the Bretton Woods legislation precisely, and the Minister of Finance annually tables in this house a report on the operations of the various Bretton Woods organizations.
Some time ago in accordance with a similar clause in the Bretton Woods legislation I tabled an annual report which covered the operations of the international bank for reconstruction and development, the international monetary fund and the international finance corporation. If this bill passes it will be the responsibility of the Minister of Finance next year and each succeeding fiscal year to lay his report before parliament within 30 days after the end of that fiscal year or, if parliament is not then sitting, on any of the first 30 days next thereafter that parliament is sitting.
[Mr. Regier.l

The hon. member asked about reports of these organizations themselves. These organizations do issue annual reports; at least their responsible officers do. Those reports are submitted to the annual meetings of the governors of these institutions; that is to say, the governors of the international bank, the governors of the international monetary fund and the directors of the international finance corporation. Those meetings are normally held in the last week of September or sometimes in early October, depending on where they are held. No minister of finance of this country has any control over the date when those reports are issued; they are not his reports. His report as provided by this legislation is a different document entirely.
The final matter that was raised by the hon. member concerned the details of management of some organizations engaged on an international basis in sending aid, such as the Colombo plan. The administration of the Colombo plan as far as Canada is concerned is a matter of interest principally to three departments of government; the Department of External Affairs, the Department of Trade and Commerce and the Department of Finance. On the administrative side the Department of Trade and Commerce is the one principally involved, because the Colombo plan organization operates under that department. The practice when I was a private member and a member of the standing committee on external affairs of this house was that we always made our inquiries and detailed review of the operations of the Colombo plan and Canada's part in it annually on the estimates of the Department of External Affairs in the standing committee on external affairs.


Paul Joseph James Martin: I would like to say a brief word on this point which has been raised by the hon. member for Burnaby-Coquitlam, because I think it is an important point. We urge that the treasure of this country should be shared with other countries by assisting the less developed countries of the world. Sometimes one runs into considerable opposition in putting forward what I believe most of us in this house recognize as an essential policy on the part of government in the interdependent world in which we live. But if we run into these objections, sometimes responsibly made and sometimes irresponsibly made, we should be prepared to give evidence of careful administration in the dispensation of funds which go from the Canadian taxpayer to assist people in other countries.
The hon. member for Burnaby-Coquitlam asked how we could get reports on the operation of this particular institution* with

special emphasis on the part that Canada has committed herself to play. I should think it must be clear at the outset that the opportunity in the case of the international development association is not as easy as in the case of the Colombo plan. The assistance given by the international development association is institutional assistance. The administration of the fund in the case of the l.D.A. is something that resides outside of Canada. The operation will be through the directors, who have a close affiliation with the international bank. In fairness I think one should say that the administration of the bank under Mr. Black has been so efficient that one may be sure that the moneys appropriated by this parliament are going to be carefully expended by him and his colleagues; but in any event that does not alter the right of the hon. member to question or to ascertain what has been done with the funds voted by parliament.
The minister, of course, will have to account for any funds voted by this parliament and expended by Canada as a member of the international development association. There would be that opportunity, I suspect, not only through interrogation and debate in the house but through participation in the committees of the house and particularly in the committee on external affairs.
With regard to Colombo plan expenditures, I do not know what the hon. member had in mind particularly when referring to the reactor in Bombay. I am not questioning his right to refer to that expenditure, because the contribution of Canada was very considerable. I believe the total expenditure is somewhere in the neighbourhood of $40 million, half of which came from Canada. One would want to make sure that the moneys spent on a project like that or on any other project were wisely spent.
In the case of the Colombo plan it should be remembered that the control on the part of the donor country is much greater, at least in principle, than it would be in the case of the project immediately before us, because the Colombo plan does not operate institutionally. It may be an international association in terms of general policy, but whatever moneys are expended by an individual country are expended by that country as the result of a bilateral arrangement made with the receiving country. In that narrower relationship there is a greater opportunity of checking up on the expenditure than there would be in the case of institutional assistance. I believe the hon. member was justified in putting this question, because *we have to be able to satisfy ourselves and the Canadian people that the moneys expended in this way are being wisely spent.
20, 1960	5121
International Development Association
We know of instances with respect to United States assistance to some of the smaller countries in Asia where there has been squandering and in some cases corruption. That situation naturally causes doubt and suspicion. In the case of any assistance given by Canada I am sure there would be no justification for any suspicion of that kind, because the administration of the Colombo plan is carefully scrutinized and I know that the Minister of Finance, as his predecessors did, exercises very great care in that regard.
I rise only to support the question put by the hon. member. I myself from time to time have run into criticisms about the expenditure of these funds. I believe we all want to feel that the greatest care is taken by those responsible for seeing that the moneys are devoted to the purposes which parliament intends.


William Moore Benidickson: Mr. Chairman, the hon. member for Essex East has very commend-ably referred to the desire on the part of the representatives of the taxpayers to assure the likelihood of moneys of this kind being dealt with in a manner that would satisfy the people who make contributions to funds of this kind. In the committee on banking and commerce we were all greatly encouraged to feel that we are very fortunate in having a new fund of this kind completely in the hands of experienced people such as those who have administered the world bank.
It is a remarkable achievement on the part of those connected with the world bank to be able to report that over 13 years they have lent $5 billion without loss. I believe those loans have gone to some 50 countries around the world. The Minister of Finance is a governor of the world bank and the international monetary fund. It is my recollection that the two organizations usually meet at the same time, most often in the autumn, but I was wondering how much more frequently, if at all, the governors of the bank meet.
The morning newspapers of both Montreal and Toronto carried substantial journalistic reports of the activities of the banking and commerce committee last week and of the purposes and functions of this proposed new lending agency. The article concluded by quoting the deputy governor of the bank who regularly has been representing Canada at the meetings of the world bank and presumably will be our senior official in the month to month operations of the new agency. The Canadian Press article quotes Mr. Rasminsky as saying:
One of the remarkable developments of the last 15 years is the extent to which the richer countries of the world have assumed this obligation-
5122	HOUSE OF
International Development Association
It has been part of the current thinking of the community-part of the current morality, if you like.
That of course I should hope would be reasonably valid. I certainly was impressed the other day by the remarks made in the committee by the hon. member for Greenwood who quoted such world-renowned witnesses as Adlai Stevenson, Mr. Hoffman, Miss Ward and others. Many of those comments the hon. member repeated here this morning.
The Leader of the Opposition referred to one of the quotations in the testimony as to the disparity between incomes in the developed and the underdeveloped countries. According to Mr. Hoffman the disparity is even greater than was mentioned this morning by the Leader of the Opposition. He indicated that in one country alone in the western world the per capita income showed an increase over the past 100 years that was double the rate of increase shown in respect to the total per capita income of the underdeveloped countries. According to the information provided by the hon. member for Greenwood the position was considerably worse than that. All the nations of the western world in the past few years have shown increases in per capita income which amount to twice the existing per capita income in the underdeveloped nations. In other words the increase in the western nations has been twice the total present annual income in the underdeveloped countries.
It was mentioned this morning that the per capita income increase in the United States is four times what the present income is estimated to be of those living in the underdeveloped countries. We are all very disturbed to find that while there has been some improvement as the result of funds of various kinds, including the United Nations special fund, the Marshall plan and the economic assistance provided through the world bank, the Colombo plan and other agencies, the startling fact remains that notwithstanding the billions of dollars provided over a period of nine years it is estimated that the per capita annual income in the underdeveloped countries has risen only to the extent of between $10 and $15 per year which works out to an increase of between $1.50 and $2 per person.
In the committee a question was raised as to just how far $1 billion through this new agency, however worth while it is, might go in accomplishing the objective of raising living standards in the underdeveloped countries which Mr. Rasminsky has described as part of the thinking and current morality of the community of western nations.


Mr. Brunsden:: Have you the figures in terms of percentages?


William Moore Benidickson: No; the figures are quoted by Mr. Hoffman, who directs the United Nations special fund. He simply indicated that the rich are getting richer, and have been in the last nine or ten years, and that the progress in lifting the per capita income of the underdeveloped nations, despite the help that has been extended, has not been very impressive. The figures given indicated that the per capita income in 1950 in the 100 less developed countries and territories was estimated at $110. In 1959 it was estimated that it would reach $125 or perhaps as much as $130, a net gain of some $15 to $20, as I indicated earlier, in 10 years. Then Mr. Paul Hoffman went on to say:
The average increase in per capita income in the western nations between 1950 and 1957, the last year for which figures are available, was approximately $300-[DOT]
That is in all the nations. I continue:
-in the United States it was $530.
He concluded with this very striking statement:
It is quite all right for the rich to get richer; but disturbing and distressing to have the desperately poor people remain desperately poor.


Donald Methuen Fleming: I think it might be mentioned for reference purposes that that is to be found on page 34 of the minutes of proceedings and evidence of the standing committee on banking and commerce.


William Moore Benidickson: In connection with operations, I wish to deal with some of the details of this article in the agreement. I refer to Mr. Rasminsky's summary of some of the misgivings of the Minister of Finance when this proposal was originally advanced by the United States. In addition to the one I mentioned earlier, Mr. Rasminsky said that the minister had, as a second concern, the possibility that there would be trade distortion effects and that loans of this kind might result in uneconomic diversion of trade. Mr. Rasminsky indicated that he thought one of the protective measures to relieve our concern as international traders about a possible dislocation in consequence of this new agency was perhaps to be found in this article, and he referred to section 1, paragraph (g) of article V on page 9 of the bill before us. I take it that the reliance that we should look for here rests almost entirely in the phrase "competitive international trade". The paragraph reads:
The association shall make arrangements to ensure that the proceeds of any financing are used only for the purposes for which the financing was provided-

And this is the point:
-with due attention to considerations of economy, efficiency and competitive international trade and without regard to political or other non-economic influences or considerations.
Is the minister aware of anything beyond this which, under the articles or under the policies so far announced by those preparing for the set up of this agency, gives greater confidence that we are not likely to expect much distortion of international trade as a result of loans that might be advanced?


Donald Methuen Fleming: I think section 1 of article IV also has a bearing on this subject in relation to the use of currency. Section 2 of article IV concerns the maintenance of value of currency holdings. I think they may be read also with article V.


William Moore Benidickson: We passed that section before I realized that we were on article V, and I was going to ask the minister with respect to article IV, section 2, paragraph (a), which reads-


The Chairman:: I point out that we are discussing clause 5 of the bill. We are not yet discussing the articles of agreement.


William Moore Benidickson: I am not referring to an article; I am wondering in what currency it is proposed that Canada will be making its contribution?


Donald Methuen Fleming: Under the articles Canada is required to make its contribution in gold or convertible currency expressed in United States dollars. That is the currency that is named as the currency of the association, and all the nations listed in part 1 of schedule A are required to make their contributions expressed in United States currency. The particular form in which the currency is to be made available is set forth in article II, section 2, (b), (c) and (d).


William Moore Benidickson: The only contributions under part II which would be expected to be paid would perhaps be additional amounts if there was a depreciation of substance in their currency.


Donald Methuen Fleming: Yes, but the nations in part II which include the underdeveloped countries, have the opportunity of contributing a portion of their subscription in their own currencies.


Mr. McMillan:: Mr. Chairman-


Jacques Flynn: If the hon. member wishes to discuss the articles of agreement I suggest we adopt clause 5.


William Hector McMillan: I just want to ask the minister a question, Mr. Chairman. Are the minutes of the discussions and meetings in
International Development Association printed form? Are they available to members of parliament? Are the minutes of the meetings of this international organization and other related organizations available?


Donald Methuen Fleming: My recollection is that the proceedings of the annual meetings of the bank and fund are not always printed in full. However, I think it is possible to obtain copies within any reasonable time of the statements made by the governor representing any particular country. These are normally mimeographed on the day they are made and circulated among all of the governors.


Erhart Regier: On the matter of the minister's annual report, I wish to express my appreciation of the answer the minister gave me, and especially to the hon. member for Essex East for his statement on what exactly is the situation. I realize that the minister is in full agreement with the intent of this international development association, as I think most Canadians will be. I believe it is not only right that we participate in this kind of organization and others like it, but it is also in our own economic interest as a country that is underdeveloped, in that we do not completely utilize as yet to anywhere near full capacity the great resources that our nation has. It is in our interest to aid these other countries.
However, the amount of Canadian participation, as the minister knows, is directly dependent on Canadian opinion. It is a desirable aim that not less than 1 per cent of our gross national product be devoted to economic aid. "We have not come even near reaching half that amount, and the great handicap is the lack of demand for such action on the part of the people of Canada.
The minister is very much aware that while Canadians are most openhearted they are also conservatively inclined. At all times Canadians will have to have the utmost of assurances that these international agencies are being operated most efficiently and are really performing the functions they are supposed to perform and utilizing the money most wisely. I know that the minister as one of the governors of the international bank attends the annual meetings, and I assume that in all likelihood he will be one of the governors of the international development association. When the minister prepares his report on the international finance corporation, exactly what is the report based on? Is it simply a question of the annual report of the international finance corporation and possibly an hour's meeting of the board of governors held once a year?
I believe the minister knows what I am getting at. Is his annual report, as called for
5124	HOUSE OF
International Development Association in this bill, going to be based on the annual report of the officers of the organization, which in turn is more or less an affiliate or branch of a larger international organization? Will he be devoting possibly half a day a year to consideration of the report? How many men will he be taking with him to examine completely the operations of this proposed organization? How many men does he now take with him to examine the operations of the international finance corporation? In how much detail is the minister made aware of all the problems and mistakes, as I am sure there are, in the work of the international finance corporation? To what degree does he expect to be made aware of the difficulties of the proposed new organization?


Donald Methuen Fleming: Mr. Chairman, so far as the annual report of the Minister of Finance in respect of the international finance corporation is concerned, I think the hon. member can best judge that from the report which was tabled some time ago, during the present session.
As to the extent to which the Minister of Finance endeavours to keep in touch with the activities of these international organizations, I must say that, as is intended by the articles of association of these important international organizations such as the international bank and the international monetary fund, the bulk of the executive work falls on the executive board of directors, and on that board Mr. Rasminsky has been Canada's very competent representative.
In addition, there is in Washington a representative of the Department of Finance who is there all the time and is available to carry on the work that is necessary in respect of Canada's position as a member of these organizations. So far as I personally am concerned, I receive a monthly report from Mr. Rasminsky as to the principal decisions that have been taken month by month by these organizations. In that way I try to keep in as close contact as may be possible with the more important decisions that are being taken in these organizations. Of course when questions arise which call for decision by the governors, such as occurred a year and a half ago in relation to the proposal for an increase in the capital of both the international bank and the international monetary fund, the Minister of Finance is kept in close contact with the discussions and a decision is taken, as was done in that case, by mail vote by the governors. A number of decisions are actually taken by the governors by mail vote.


[Stage Direction]
Clause agreed to.
Jacques Flynn: Shall the articles of agreement carry?


William Moore Benidickson: Did you call article VI?


Jacques Flynn: I am calling all of them together, because I do not think it is necessary to call them one by one.
Articles of agreement agreed to.
Schedule A agreed to.


[Stage Direction]
Title agreed to.
Bill reported.
Mr. Speaker:: When shall the said bill be read the third time?


Some hon. Members:: Now.


Donald Methuen Fleming: third reading of the bill.
Motion agreed to and bill read the third time and passed.


Mr. Speaker:: It being one o'clock I do now leave the chair.


Donald Methuen Fleming: Perhaps we could resolve the house into committee so that at 2.30 we could continue in committee without asking the Speaker to return.



PUBLIC SERVICE SUPERANNUATION ACT


Donald Methuen Fleming: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to amend the Public Service Superannuation Act with respect to contributions, pensionable service, benefits, the calculation of annuities payable to widows and children, persons re-employed, medical examinations, transferred pensionable employees, contributions to the retirement fund, reciprocal transfer agreements and for certain other changes in connection with the administration of the act.
Motion agreed to and the house went into committee, Mr. Rea in the chair.
At one o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 2.30 p.m.
Donald Methuen Fleming: Mr. Chairman, the Public Service Superannuation Act was enacted in 1953 and came into effect on January 1, 1954. This resolution contemplates a number of amendments to the act to which the government has been giving consideration for some time. The most important of the amendments are designed to improve substantially the value of the basic benefits available to most civil servants who contribute to the superannuation account. Corresponding amendments provide for adjustments to rates of contribution. Other

amendments make provision for improved benefits to smaller groups of persons, and others are designed to streamline the administration of the act.
Earlier today I tabled three reports submitted to me by the chief actuary of the Department of Insurance on the actuarial valuations of the superannuation account, the public service death benefit account and the regular services death benefit account respectively. It was necessary for the government to receive the actuarial valuations of the various accounts maintained for the purposes of this act before the nature of the amendments thereto and their actuarial implications could be determined. The last of these reports was received subsequent to the last session of parliament.
I have received many requests concerning the pensions of civil servants. A great number related to increases in the pensions of persons already retired. These matters were dealt with at the last two sessions of parliament and embodied in the Public Service Pension Adjustment Act, 1959. Many requests have been made seeking improvements in the basic benefit formula for those who have not yet retired.
The basic benefit formula applicable to most civil servants who contribute to the superannuation account provides for a pension equal to the number of years of pensionable service up to 35 years, multiplied by 2 per cent of the average salary received by the pensioner over the period of 10 consecutive years in which his salary was highest. The representations which I have received have sought a reduction in the 10-year average salary formula, and thus an enhancement of the value of benefits received.
Accordingly it is proposed to introduce amendments which will establish the formula on the basis of the best consecutive six-year average instead of the previous 10-year average. This change will place the formula applicable under the Public Service Superannuation Act on the same basis as that now available to new members of the regular forces and of the Royal Canadian Mounted Police under their superannuation statutes. The uniformity in the basis of benefits throughout our superannuation legislation thus achieved, and which has heretofore been lacking, will represent a major advance for civil servants and a major improvement in administration.
I should mention that the amendments to which I have just referred in no way impair the position of a diminishing number of civil servants who fell into special categories on the coming into force of the earlier civil service superannuation act on July 19, 1924
Public Service Superannuation Act and elected to contribute under that act during the following three years, thus qualifying for a pension calculated on a basis of the average salary over the last five years of service.
The Public Service Superannuation Act provides pension benefits comparing favourably with those of most private plans in Canada. It has been generally recognized in the civil service that under a plan of this nature, where costs are shared by civil servants and by the government as employer, it is only equitable that the cost of major improvements in the benefits should also be shared. Thus the improvement proposed in the benefit formula is coupled with an amendment which provides for an increase in the male contribution rate from 6 per cent to 62 per cent of salary. No increase in the female contribution rate of 5 per cent is to be made. A corresponding increase will be made in the matching contribution made by the government. Thus the over-all rate of contribution will be 13 per cent for male employees and 10 per cent for female employees.
The additional cost to the government in a full year will be an estimated $2.5 million, based on salary rates in effect as of January 1, 1960. There will be some small upward revision of this figure to take account of salary increases granted or contemplated in 1960. The change from the 10-year average to the six-year average in the basic benefit formula will increase the value of benefits available under the superannuation act by $21 million as of January 1, 1960. Again, there will be a small increase in this amount to take account of salary increases granted or contemplated in 1960.
The other proposed major change in benefits relates to the supplementary death benefit provided under part II of the act. At present this commences to decrease after age 60 and disappears entirely on retirement or at age 70, whichever is the later. An amendment will be proposed providing that every person with five years' continuous employment participating under part II of the act will on his 65th birthday, either as an employee or as a pensioner if he was entitled to an immediate annuity on retirement, be credited with a paid-up $500 death benefit as part of his over-all benefit protection.
The cost of this benefit will be borne entirely by the government. It is estimated that this change will involve an additional expenditure of about $1.5 million in the first full year and $500,000 annually thereafter, increasing with the growth in the number of participants.
Another measure which I am sure will commend itself to the committee is one

Public Service Superannuation Act which will provide for alleviation in the conditions which require a reduction of pension during short periods of re-employment in the civil service. The present formula, which calls for a reduction in the pension after as little as one day of re-employment in many cases, will be replaced by another which calls for a determination based on the salary received in each quarter by a re-employed civil service pensioner. This will eliminate the majority of the pension adjustments which otherwise would have had to be made in the future.
The bill proposes that the amendments relating to increased contributions shall come into force at a time provided for by the governor general in council. It is my intention to recommend that, after second reading, the bill be referred to a special committee where it will be possible to study the amendments and the changes in the basic benefit and contribution formulas in detail.


Mr. Mcllrailh:: I am sure the committee of the whole is very much interested in this resolution and the subject of providing pensions or retirement benefits for employees of the public service. This subject is one that has occupied the House of Commons from time to time for a great many years and on many occasions.
However, I think it fair to say that the present concept of superannuation, as we understand it, had its origin in the work of the committee of 1923 which examined this whole field of civil service legislation and civil service superannuation. As a result of this very splendid piece of work done by this committee headed by Hon. James Malcolm, we had the civil service superannuation act of 1924, which I think was a considerable departure from the legislation in operation up to that time and was the basis of our present legislation.
Then in 1938 and again in 1939 there was a committee of this house set up to examine into this subject. Much excellent work was done by that committee in those years. Unfortunately the legislation which that committee recommended had to be postponed by reason of the intervention of the war in 1939 and its continuance for some years. It was not until 1944 that the amendments were made to the 1924 act, a period of 20 years having elapsed without any basic change in the legislation.
It is interesting that in the 1924 legislation there were two conditions precedent of special significance before an employee was entitled to receive superannuation on retirement. One of those conditions was that he must come under what was then called the status of a permanent employee. The word
[Mr. Fleming (Eglinton) .1
"permanent" seemed to have been given a secondary meaning in the legislation relating to the civil service at that time, and indeed until very recent times, and the word "temporary" to been given a secondary meaning that was quite different from its ordinary meaning.
In any event, the "temporaries" were excluded from the benefits of the legislation until the 1944 amendment, and all persons who were not paid on the basis of a stated annual salary were excluded from the possibility of benefits under the 1924 legislation. That provision applied to great numbers of persons. For instance, persons with trades training in the printing bureau who were paid on a weekly basis were excluded from the act because they did not meet the requirement of the legislation of being in receipt of a stated annual salary.
In 1944 a new departure was made and large numbers of temporaries or so-called temporaries and persons who were paid other than on the basis of a stated annual salary were included. Then in 1947 amendments were made improving the legislation and adopting more of the recommendations of the committee of 1938 and 1939. Then there were subsequent amendments in 1953. Prior to the 1953 bill the whole principle of the receipt of benefits had been that they were payable as a matter of grace rather than as a matter of right to the civil servant. The 1953 act changed that basis altogether and made the superannuation benefits payable as a matter of right to the employee on retiring rather than as a matter of grace. A great many other changes were made. However, the whole nature of the change was to extend what already, in relation to the times, was a good piece of legislation and a very satisfactory one in relation to the concept on this subject current at that time.
From 1953 onward there have been other consequential amendments, all of which I think were improvements in the act. They tended to meet the changing concepts on this subject and to enlarge the number of civil servants who are entitled to come under the scope of this legislation.
The resolution before us is a rather interesting one. It deals specifically with nine subject matters or nine changes. It is a resolution preceding a measure to amend the Public Service Superannuation Act on nine different points; namely, with respect to contributions, pensionable service, benefits, the calculation of annuities paid to widows and children, persons re-employed, medical examinations, transferred pensionable employees, contributions to the retirement fund, reciprocal transfer agreements and certain other changes.

A great many representations have been put forward to the minister by responsible associations of the civil service. Indeed, I think a great many of them have been circulated among all hon. members. I suppose it would be technically possible to argue the merits or demerits of each of those numerous recommendations, but I do not think that is the effective way in which to approach this legislation today. From what the minister has said I take it that while there may be a great number of subject matters covered and a great number of amendments, there is not any extensive basic new principle involved in the new legislation.
I was interested to hear the minister advise the committee that three actuarial reports have been tabled dealing with the condition of the fund. I shall look forward with interest to seeing those documents and to seeing what the situation is. I have not seen them; I am not familiar with them, so it would be useless to debate them.
I was interested to hear the minister say that the rights of those persons under the old retirement act of 1919 and 1920 are preserved and are not affected. That has been a problem of some real concern. Some of them felt they should have come under that act, particularly so far as it involved retirement benefit based on five years' employment rather than ten years. The matter has been one of some controversy and concern over the years. With the change in the main act reducing the term of service on which superannuation is based from ten years to six, the difficulty, for that reason as well as from the effluxion of time, will, of course, have largely disappeared.


Mr. Bell (Carlelon):: Will the hon. member permit a question?


George James McIlraith: Yes.


Mr. Bell (Carleton):: As the hon. gentleman has obviously made a study of this matter, would he be good enough to tell the committee, if he knows, why the original change was made from the five-year average to the ten-year average?


George James McIlraith: I have always understood it was an actuarial matter. It is a matter that has been controversial. There have been arguments about it for as long as I can remember, and very severe ones. 1 do not think I would want to give a categorical answer to the question.


Thomas Miller Bell: It was made in 1924.


George James McIlraith: In 1924, yes. Then as a result of the study, when the new superannuation act of 1924 was brought in-and in
20, 1960
Public Service Superannuation Act relation to its time it was indeed a revolutionary act, a progressive one-it was based, as I say, on the provision that contributions should be computed on the basis of the best ten years of employment. In the previous legislation, namely the retirement act, it was based on the concept of five years.
The other thing I was interested to hear the minister say had to do with the death benefits under part II of the act. There has been a good deal of discussion about that matter. It would appear that some unfairness was being suffered owing to the fact that those supplementary death benefits were reduced each year after age 60. It was a subject of great controversy and a good deal of discussion. As I understood the minister's remarks, a change is being made in order to rectify that difficulty in the light of the experience since that provision was first put in the act, and to improve the position. There is another factor, of course, namely the longer life expectancy which has made this provision in the act more important than it had been when it was first put in or when it was first advocated in earlier years.
My own attitude about the resolution is this. I should like to see the bill. I want to have it before us and to study it. I understand that the minister proposes having the bill referred to a special committee to be set up and having it studied in that way. In general the legislation has been very good legislation. There are many small technical matters in it which are very important to individual civil servants and which should be examined. I am sure the committee will want to hear the representations of associations on the subject and examine the matter in some detail.
I was interested in noting that the superannuation act was referred to a committee in 1938, but that it took two whole sessions of parliament to deal with the matter. I hope nothing like that will happen this time. I hope we can deal with it in committee quite promptly, have the matter examined and brought back into the house so that it can be dealt with legislatively this session and brought into operation. I presume that is the minister's intention in that regard.


Donald Methuen Fleming: Yes, Mr. Chairman. May I just say that I am entirely in accord with the view expressed by the hon. member. We have this resolution procedure applied to a measure like this. It really does not fit measures of this kind, and I entirely share his view that the discussion of this measure can be much more aptly, indeed more intelligently, carried on after members have had an opportunity to peruse the bill.
5128	HOUSE OF COMMONS
Public Service Superannuation Act


George James McIlraith: Just to conclude my remarks,
I look forward with eagerness to seeing the bill.


Donald Methuen Fleming: It is ready to be distributed.


George James McIlraith: I hope it is a good bill and corrects many of the anomalies which are now in the act. I hope it will improve some of the weak spots which have been found in the course of administration of the act, and I for one look forward to an opportunity of examining it in some detail at the appropriate committee stage.


Erhart Regier: Mr. Chairman, the resolution before us reads, in part, that it is expedient to introduce a measure to amend the Public Service Superannuation Act, and this is the time for us to express our opinions as to what these amendments ought to contain.
It has long been my contention that any act of this kind ought to arrange for pensions to be automatically raised or lowered as the cost of living rises or falls. 1 remember a former minister of finance announcing in this house that if he were able to accommodate pensioners in this matter he would establish for himself the reputation of being the most famous minister of finance anywhere in the world. However, he was a little in error, in that there are many ministers of finance in the western democratic world who have made arrangements whereby people on fixed incomes have those incomes moved upward or downward in step with the cost of living. For many long years in this house the former member for Winnipeg North Centre, Mr. Stanley Knowles, pleaded the cause of the retired civil servants, and Conservatives when in opposition used to endorse his contentions in this regard.
I notice the minister had this to say in this regard:
I have received many requests concerning the pensions of civil servants. A great number related to increases in the pensions of persons already retired. These matters were dealt with at the last two sessions and embodied in the Public Service Pension Adjustment Act, 1959.
Apparently that is all the minister has to say on this matter at this particular time. It is our contention that the cause of the retired civil servants has not yet been adequately dealt with. I hope that despite the minister's announcement, when we have the bill before us we will find therein that the government now, as was its opinion when it was on the opposition benches, is going to pay some attention to the needs of the retired civil servants, and that a real move is going to be made in order to bring their incomes into line with the contributions they made

in the light of cost of living as it was at the time they made those contributions.
I will be watching the bill very closely when it is brought down, and I hope the Conservative government in office are going to be as good in this regard as when they were not in government but in opposition. I hope that at long last those retired civil servants who have been unduly penalized by the ever rising cost of living are going to receive equity in our society.
Resolution reported and concurred in.
Mr. Fleming (Eglinton) thereupon moved for leave to introduce Bill No. C-76, to amend the Public Service Superannuation Act.
Motion agreed to and bill read the first time.



CIVIL SERVICE ACT


Donald Methuen Fleming: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure respecting the civil service of Canada to amend, revise and consolidate the Civil Service Act, chapter 48 of the revised statutes of Canada, 1952.
Motion agreed to and the house went into committee, Mr. Rea in the chair.


Donald Methuen Fleming: Mr. Chairman, the measure which the present resolution would authorize to be introduced is of the highest importance. It touches all aspects of the appointment, classification, tenure, rights and responsibilities of the civil service of Canada, and the powers and duties of the independent civil service commission charged with responsibility in relation thereto.
The present Civil Service Act enacted in 1918 is a landmark in Canadian history. It was a major advance over all the legislation which preceded it, including the acts of 1868, 1882, 1885 and 1908. At a stroke it placed the recruitment, promotion, classification and organization of the Civil Service Act of Canada beyond the reach of partisan political interference, and laid the foundation of what has come to be known as "the merit system". For many years the Civil Service Act has been the bulwark of this principle.
This principle, however, has not withstood all the tests to which it has been submitted. During world war II overriding legislation was adopted which permitted both the principles and the provisions of the act to be ignored and practices and procedures to grow up at variance with the letter of the law. During the post-war period it became increasingly clear that strict adherence to

the provisions of the act prevented the civil service commission from giving such service to departments of government as it was required and indeed desired to give, particularly in the fields of organization and classification. In these latter fields the expansion of the country and the enlargement of the federal government's commitments posed special problems.
Since 1918 the functions of the civil service have undergone a transformation and proliferation. Its tasks have become infinitely more diverse, more complex, more technical and more specialized in keeping with the vast extension of the public business and the activities of government. More and more it has been recognized as essential to good government that Canada should maintain a public service of the highest competence in many fields and of unchallenged integrity.
At the request first of Mr. St. Laurent in 1957, then of the present government on its accession to office in June of that year, the civil service commission conducted a review of the entire field of personnel administration in the public service with a view to revision of the Civil Service Act. Its report, which has been commonly named after the then chairman of the commission, Mr. Heeney, was in due course presented to the government, and was tabled in parliament early in 1959. It has attracted the widest interest across Canada. The government has acknowledged its deep appreciation to Mr. Heeney and the two commissioners, Miss Addison and Mr. Pelletier, for this very valuable report.
The report does not in any sense purport to be a draft statute, but it contains in appendix A a detailed list of provisions which it suggests should be incorporated either in the act or in the regulations made pursuant thereto. I am informed that it was not the purpose in drawing up this appendix to use language which would be necessarily appropriate to such enactments, nor to do more than suggest the subject matters and the method of treating them as a guide to the draftsman in drawing the bill, subject always to the views of the government on matters of policy. It therefore follows that the language of the bill, taking into account the special requirements of an act of parliament, will rarely conform to that of the recommendations contained in the report. Particularly in that area of decision as to what should properly be contained in the body of the bill and what should be assigned to regulations to be made pursuant to it, it has been necessary to modify the commission's suggestions.
It should be noted also that the report contemplates the eventual establishment of a
Civil Service Act
single civil service which would embrace the employees of a number of agencies which have been established by separate acts of parliament with provisions which are peculiar to the agencies themselves and under which they have been working for many years. The government does not at this time propose to disturb the composition of the civil service by adding to it the personnel of agencies not subject to the existing act. Such a course would involve the submission to parliament of amendments to the numerous statutes which constitute such agencies now and the wholesale incorporation within the civil service of large numbers of men and women without consultation and without sufficient examination of the problems which such a step would entail.
The report proposed that the commission should give up its responsibility for approving the organization of government departments and, while retaining an advisory function in this field, in which it has become expert over the years, permit deputy heads of departments to be masters in their own houses where questions of departmental organization are concerned, subject to the approval and authority of the governor in council. It was further proposed in the report that more flexibility in matters of recruitment and selection of personnel for the civil service be permitted to the commission and, let me say at once, only to the commission, under circumstances which might in its opinion render the usual procedure by way of competition impracticable and unsuitable, and where the commission might deem it desirable to delegate these functions in special circumstances to deputy heads. These two cardinal recommendations of the commissioners have been adopted and incorporated in the bill.
The bill reaffirms and establishes the principles of the merit system as exemplified in provisions for selection and classification of employees in the civil service of Canada by a strong and independent civil service commission and by that commission alone. Anything less would be a renunciation of a tradition of which this country may well be proud, the tradition of the independence of our civil service which has placed it in the front rank of similar organizations throughout the world.
The bill also contains a definition of the public service extending beyond the civil service itself. This definition will extend to employees of agencies outside the civil service but within the greater compass of the public service the privilege of transfer and promotion into the civil service on the same basis as employees who are already in the civil service.

Civil Service Act
The present act contains no provision for the right of appeal by an employee to the civil service commission, although the regulations made pursuant to it provide for such appeals as are now taken. The bill will contain explicit provision for the composition of appeal boards under the authority of the commission and for the circumstances under which an appeal may be taken, including the right of appeal against a departmental recommendation to dismiss an employee.
In keeping with the spirit of the times, recognition is given to two important principles which have engaged the attention of staff associations within the civil service; first, that the pay of an employee is a matter not of grace but right, and second, that consultation between the staff associations and appropriate officers of the government or the commission on questions of pay and conditions of work as the need arises is desirable. These principles are either expressly recommended or implied in the Heeney report.
The present statute provides for an employee appointed to a local position to be qualified in the knowledge and use of the language of the majority of persons with whom he is required to do business, be it French or English. The proposed bill, however, recognizes additionally the desirability of giving a preference not only to those who can speak the language of the majority but to those who are skilled in the use of both the official languages of this country, not only when appointed to local positions but also to positions at the main offices of departments wherever, in the opinion of the civil service commission, effective service requires them to be placed.
The government does not think it right at this time to give effect to those recommendations in the report which would have the effect of altering the existing law providing for preference in competitions for entry into the service in the case of veterans of the first and second world wars and the campaign in Korea. The law which was established in this respect by the previous administration may not have proved uniformly satisfactory in all its aspects, but it represents a covenant between the nation and its returned servicemen the terms of which cannot be enlarged or abridged at this late date without injury to both parties. If the entitlement were now enlarged to confer the preference upon those who did not possess it heretofore, all those servicemen who were applicants for vacancies in the civil service over these past years and who have not enjoyed its benefits would feel unjustly treated in retrospect. If it were in any way limited or curtailed by restricting,

for instance, its application to only one occasion, such action would constitute a breach of faith which the government declines to contemplate.
The house will therefore observe, when the bill is examined, that the veterans preference provisions of the present act are maintained intact subject to a direct reference to the situation of veterans of the Korean campaign as contained in the Veterans Benefit Act.
Generally speaking, therefore, the bill contains the best of the existing legislation, provides for the removal of such anomalies as have arisen in the course of the application of the former during over 40 years, and plainly provides for either the authorization or prohibition of many of the practices which have grown up without sanction during this period.
The bill is somewhat longer than the present act. The government recognizes the need for careful examination of it by parliament. To facilitate such detailed consideration I shall propose that the bill, following second reading, be referred to a special select committee of the house for study and report. I think it is obvious that our resolution procedure is not well adapted-


George James McIlraith: On that point, does the minister contemplate that the study and report will take place this session?


Donald Methuen Fleming: Yes, Mr. Chairman. When hon. members have an opportunity of examining the bill I think they will feel that this is quite feasible. I am expressing that opinion. It is an opinion given after careful consideration of the matter. It will, of course, be a matter for decision by the house.
I think it is obvious, Mr. Chairman, that our resolution procedure is not well adapted to new measures of this comprehensive nature, and that the measure can be debated much more intelligently on the motion for second reading after all hon. members have received copies of the bill and have studied its provisions. The bill is available for distribution immediately on adoption of this resolution.
(Translation ):


Mr. Caron:: Mr. Chairman, it is obvious that the Liberal party does not object to a detailed examination of the Civil Service Act for the purpose of improving it, if possible.
Besides, it was the Liberal party which recalled Mr. Heeney from Washington to make him chairman of the civil service commission and entrusted him with the task of making a thorough study of the service and of submitting a report to parliament to enable us to legislate on this matter.

We are ready to approve any intelligent change that could be made. Th act is out of date, conditions have changed. It is not possible for us, however, following the statement made by the minister, to accept straight off the government's proposals.
Before coming to a definite conclusion, surely we must carefully look into them.
However, we can at present discuss the situation of federal civil servants. An uneasiness is being felt, especially since the present government came into office. At present, civil servants fear any changes to the present act, particularly when those changes are suggested by the Conservative party.
They remember the old precept: I fear the Greeks even when they are bearing gifts, even though, since the Conservative government came into office, they have not received any gifts; instead, they met with rebuffs.
I have on file a great many letters expressing the views of civil service commission employees. Since the Conservative party came into power, those employees have been living in fear because of the stand taken towards them by certain members of that party.
In this house and outside, certain Conservative members have criticized the civil service commission and referred to it in not too pleasant words. Moreover, one of the ministers, during an election campaign, went as far as to say that he had not managed to curb the civil service. As a matter of fact, the Minister of Defence Production (Mr. O'Hurley) stated this:
We have not yet managed to curb the chaps at the civil service commission, but we will do it yet and then we are the ones who will be running all that business.
Following such statements made by a minister of the crown, you can be sure that federal civil servants do not trust the present government too much when it comes up with proposals to revise the Civil Service Act.
Besides, when the matter of salary increases was brought up, the minister replied: "If you want increases, we shall have to raise taxes by 15 per cent."
Yet, some increases have been granted, and taxes have not gone up 15 per cent.
Therefore that statement was only meant as a scare to check those who were clamouring for higher salaries or better working conditions.
Yet those people are servants of the state and render innumerable services, regardless of the party in power.
Civil Service Act
The minister mentioned-and if I misunderstood him, let him set me right-that more latitude was to be given department heads.
That is taking an extremely dangerous position. Such attitude can only lead to favouritism within the commission itself.
Commissioners are independent from divisional heads. On the other hand, if a department head does not quite agree with his subordinates, a difference of opinion may arise which, in practice, may lead to an incomplete, incorrect report. Thus the civil service commission is not supplied with a true picture of the situation, and this can work to the detriment of the employee, particularly when he is trying to obtain a raise in salary, some improvement in his position, or a promotion.
The minister tells us that he wants to establish a new appeal board, so that appeals may be decided upon outside the commission. I am all for it, as long as that new appeal board has no political character.
Since 1917 Canada's public service has been kept out of politics and I hope that this government intends to maintain that practice. Federal civil servants are meant to serve the state, the people of Canada and not any particular political party.
We have asked for raises in salaries and improved working conditions so that public servants would be in a state of mind conducive to better work. Our request has been rejected. Yet, goodness knows how many complaints have come in from every quarter.
Even the papers have protested against the government's attitude since salary raises were granted. As a matter of fact, I have here in my hand a letter written by the employees' association of the Veterans Affairs Department, which reads in part as follows:
(Text) :
I have been asked to draw your attention to the very considerable dissatisfaction and unrest-
(Translation) :
Please note, Mr. Chairman, that this was written rather recently, on May 18, 1960.
(Text):
-of our members over the government's recently adopted practice of making pay revisions in the civil service effective on different dates.
Attached is the news release of our president on May 16 and the statement made on CBOT, on the same date, by the undersigned. These speak for themselves.

Civil Service Act
(Translation):
And it was further said that:
(Text):
By its latest action in making wage increases for cleaning service men, maintenance helpers, firemen labourers, and stationary engineers effective May 1 rather than April 1, the present government has shown itself completely indifferent to good employer-employee relations in the federal government service.
(Translation):
Yes, Mr. Chairman, it seems this government has been doing its best to keep creating difficulties for civil servants. I do not know what has been going on in their minds but I am sure they have not carried on the policy of the previous government. In fact, we note that a salary increase of 8.5 per cent was granted in 1947; one of 8 per cent, in 1948; one of 10 per cent, in 1950; of 8.5 per cent, in 1951; of 7 per cent, in 1953; of 7.5 per cent, in 1956, and of 6 per cent, in 1957, the government having taken all the credit for the latter, which, mind you, had been planned by the previous government, before the Conservative party got in. That series of increases was clear evidence of the attitude of a government which had at heart the welfare and satisfaction of its employees. If we want civil servants to do the work we ask them to do, we must give them satisfaction, make them confident, put them at ease; otherwise, they will be unable to work properly.
Mr. Chairman, we noted that among salary increases granted recently, some were still inadequate. I have here a registered letter sent to me by a civil servant who is getting $237.50 a month and who, after all deductions are made, only gets $104.20 every two weeks, that is, $208.40 a month, instead of $237.50, which is still an inadequate salary for him to live decently.
Mr. Chairman, the civil service fears the government, has always feared it, and will keep on fearing it. I have here several notices issued by civil service associations, and if we consider them one by one-I will not read what the employees themselves have stated, but I am going to give you the titles -we realize what civil servants think of the whole thing. I quote:
(Text):
A look at the record reveals persistent efforts made by the C.S.A.C. to close the gap between salaries paid by the government and those paid by private employers.
(Translation):
They have received nothing yet, despite representations from many sources.
Still in the same magazine, we find a little further down that the committee is always complaining that civil servants are keeping a united front in negotiations.

Mr. Chairman, in any one of those magazines, you could find similar comments. There is this one, for instance:
(Text):
Urge Immediate Increases.
(Translation):
A little farther down, we find this:
(Text):
President Sees Discontent.
(Translation):
Again in the same magazine, we read- (Text):
Report on civil service. Civil service commissioners make far-reaching recommendations following exhaustive study of Civil Service Act and regulations.
(Translation):
And today, when the session is nearing the end, the Minister of Finance comes forward with this resolution and says: We are going to insist that this bill be passed this year. He will not even allow civil servants and civil service organizations enough time to give it adequate consideration, or give them an opportunity to appear before the committee and make recommendations. I think it is unfair to hon. members, to federal civil servants and to their organizations, to expect them to make such a quick study of the bill.
We ask the government, after the house approves the bill on first reading, to postpone consideration of it so that we may study it seriously and adequately with a copy in hand. Thus we could reach an opinion, raise' objections if necessary, and suggest whatever amendments we feel are called for.
The hon. members who will be appointed to the committee to study this bill will have to sit on other committees, and in the house, at a time when the government proposes to bring in its most contentious legislation. This is unfair to an opposition which is not numerous enough to be able to study all those bills at the same time-
(Text):


Donald Methuen Fleming: Mr. Chairman, I should like to ask for your ruling. It had not occurred to me that this resolution asking for leave to introduce a bill to amend, revise and consolidate the Civil Service Act would be a proper vehicle under the rules of the house for a debate on civil service salaries. The hon. member is speaking on the subject of civil service salaries. If it is proper for him to do that, presumably it would be proper for other members of the committee to do the same thing. I ask for your ruling on the point, Mr. Chairman, because I had assumed that the estimates would provide a proper occasion for that sort of discussion. As you

know, I have brought in supplementary estimates designed to provide an amount to increase civil service salaries, and no doubt any debate on this subject can properly be held on that item.
Although the hon. member has gone on now on this subject for some time, it had not occurred to me, as I say, that it would be proper to discuss this subject on the resolution and on the bill. This is a measure dealing with legislation. It is designed to replace the present legislation with an entirely new act. It does not touch the question of salaries of civil servants as such at all. That is a matter for provision by way of estimates. In view of the fact that the hon. member has made it quite clear that this is the subject of his speech, I think it would be well that the point should be ruled on, because other members will wish to have the benefit of the guidance of the Chair.


Lionel Chevrier: On the point of order, may I say it strikes us on this side of the house that there is no one who attempts to hold up his own legislation more than the Minister of Finance. Speaking to the point of order, sir, I took down some of the minister's words in the course of his discussion of the resolution a few moments ago, and he dealt in effect with what the bill would contain. Among at least half a dozen items that were mentioned, No. 4 was that the pay of the employees was a matter of right and not of grace.
During the course of one paragraph at least he went on to give some indication that this was contained in the legislation. The resolution therefore deals with exactly what the hon. member for Hull was discussing, and how can funds be provided other than by means of a resolution? If our right to discuss the pay and allowances of members of the civil service is going to be affected, what is the use of opening up the whole of the Civil Service Act during the course of second reading and in committee? It cannot be done, I submit with deference, without some discussion of pay and other matters.


Alexis Pierre Caron: On the point of order, it is a fact that I have spoken about salaries and salary increases, but I simply wanted to exemplify the uneasiness which exists in the civil service at the present time because of the attitude the government has taken since it has been in power. I was dealing with the difficulties which have been created by the government since 1957, and I have the right-


The Deputy Chairman:: Order. The hon. member for Ottawa West.
Civil Service Act


George James McIlraith: Mr. Chairman, as I understand the procedure of the house, legislation which requires the expenditure of money must be preceded by a resolution, and if there is one thing that the resolution stage does permit it is discussion of the money aspect of the legislation. The house is being asked to consider whether or not it should give approval to the government to bring forward this legislation. The reason that approval, before the introduction of the bill, is asked for, is that the legislation involves the expenditure of money. In other words it involves the payment of salaries to civil servants. That is my understanding of the whole basis of the resolution.
The minister started his remarks by a historical reference to civil service matters and to the Heeney commission being set up. Then he went on to deal with more specific matters that would be included in the legislation which the minister is asking permission to bring forward for approval or rejection by the house.
The minister referred to two important principles. As I have noted it, the first important principle is that the pay of an employee is not a matter of grace but of right.
That is the first principle the minister sets out in his own remarks on the resolution. Then he goes on to deal with consultation between the staff associations and the appropriate officers of the government or the commission on the question of pay and so on. Then, if these two principles were not enough, he goes on to say that these two principles are either expressed or implied in the Heeney report, about which he had a great deal to say. So if there is one subject that we are permitted to discuss on this resolution, it is the matter of the provision of pay and the expenditure of the taxpayers' money.


Donald Methuen Fleming: May I clarify one point? There is some difference between discussing a principle that pay shall be a matter of right and not of grace, on the one hand, and discussing rates of pay and salary, on the other. This is the point I was raising. Certainly the principle here is clearly within the scope of proper discussion on the resolution, but what the government has been doing in relation to rates surely is not raised by this. There will be a proper opportunity to discuss that later on the estimates.


Lionel Chevrier: May I ask the minister a question? I should like to ask why we have a resolution at all.


Donald Methuen Fleming: In this case the bill has to be preceded by a resolution because it provides for the appointment of a

Civil Service Act
commission; it provides lor the remuneration of the employees of the commission, and so on. It is lor this reason the bill has to be preceded by a resolution.


Lionel Chevrier: Will the minister tell me what expenditure is being provided by this bill?


Donald Methuen Fleming: There is no direct expenditure provided by the bill, but the bill provides, as does the present act, for the appointment of a commission, for its retaining its employees, and then there is a provision with relation to the exercise of its functions with respect to the civil service.
It is clear, Mr. Chairman, that for much of the content of the bill no resolution is required, but in the respect I have mentioned a resolution is required. The point I was raising concerns rates of pay. Now any member can discuss the principle that pay should be a matter of right and not of grace. It is a matter of grace under the present act. What is being brought into the discussion now is the question of rates of pay, those rates that have been provided and changed. I think, with respect, Mr. Chairman, that that is a proper matter for discussion when that item in the supplementary estimates is under discussion.


John Whitney Pickersgill: Before you make a ruling, sir, may I say that I have looked at the resolution and it is a well accepted rule that the only purpose in having a resolution is that the legislation involves some expenditure by the crown, otherwise a resolution is not necessary at all. It was always accepted also when I was secretary of the cabinet and when I was a minister that the precise nature and purpose of the expenditure must be stated in the resolution. I have read this resolution and I have not found anything in it which gives a hint or indication of what the expenditures are to be. All it says is:
That it is expedient to introduce a measure respecting the civil service of Canada to amend, revise and consolidate the Civil Service Act, chapter 48 of the Revised Statutes of Canada, 1952.
It appears to me either that this resolution is totally unnecessary or that the government has not told us in the resolution in what respect it is necessary. It seems to me that on the basis of this resolution we cannot proceed at all. We are entitled to be told in the message from the crown precisely what is the nature of the charge that is to be imposed before we are asked to embark upon a debate.
(Translation):


Alexis Pierre Caron: Mr. Chairman, if I took the liberty of dealing with salaries, it is because the civil service commission itself makes recommendations to the government with

regard to salary increases. This is obvious; this has been proved and established. Last year, the civil service commission refused to recommend salary increases. The report was made public. This year, the civil service commission recommended such increases and the report remained secret. Since the civil service commission may be called upon to make a recommendation respecting salary increases for civil servants, I feel that when we are considering this resolution we have a right to refer to salaries and to the dissatisfaction of civil servants. Mr. Chairman, at all events-
(Text):


Charles Edward Rea: I quite agree with what the hon. member for Ottawa West said until he reached almost the end of his remarks. I feel that this resolution is concerned with the machinery of this act and not with rates of pay. I believe most hon. members will agree with that. In my opinion this should be borne in mind because there is nothing that I can see in the resolution about rates of pay. I suggest, therefore, that the hon. member stay away from rates of pay.


John Whitney Pickersgill: If the hon. member will permit me, Mr. Chairman, I raised a definite point of order. My point is, what is the purpose of this resolution, and whether or not there is a proper resolution before the house.


Charles Edward Rea: That is a legal point, of course, upon which the Chair has no right to rule. I can only rule on the relevancy of speeches to the resolution.


Alexis Pierre Caron: If there should not be any resolution upon which to base any remarks, why is it here?


Charles Edward Rea: The house has ordered me to come into the chair on this resolution. There is nothing else I can do at this moment.
(Translation):


Alexis Pierre Caron: Mr. Chairman, while avoiding to speak of the rates of salary increases, because the Minister of Finance has suddenly become extremely touchy since he has moved to the other side of the house-I must say that it is important that the matter of those increases be discussed.
Recently a report was submitted to the government by the civil service commission. We wanted to get a copy of that report, but the government refused to make it available. I do not know why, but it was refused, and through their organizations, the civil servants -who have vested rights, being government employees, state employees-were not able

the civil service commission. And since everybody was interested in the-
(Text):


Charles Edward Rea: Order; that has nothing to do with this resolution, that has to do with rates of pay.


Alexis Pierre Caron: I think I might be permitted to say that because I have something else to bring forward on the resolution and this has to be said so that it is clearly established. There is a report from the civil service commission. It is not from me, it is not from the government, and the report deals with salary increases but the employees have not had an opportunity to look at that report. I am not speaking about rates. I am not saying that the employees should get 2 per cent or 10 per cent or 8 per cent. I am saying that an increase has been recommended by the civil service commission, and that report should have been placed before the committee so that the employees could look at it and know what it is about. This is not on rates.


Charles Edward Rea: How would the hon. member relate that to this resolution?


George James McIlraith: Mr. Chairman, how can the committee determine the question of whether or not this resolution is bad because the minister does not propose to put into the Civil Service Act a provision that the rates of pay shall be determined by the commission or shall not be determined by the commission. How can that question be determined. We are dealing with legislation which affects the whole civil service of Canada. I do not know how we can discuss the adequacy or inadequacy of the legislation if we cannot discuss this matter of whether rates of pay should be determined in one way or another; whether the minister is handling it right or handling it wrongly. For the life of me, I cannot understand how we can discuss this matter concerning public employees without discussing, of necessity, the method of payment and the amount of their pay, whether it is adequate or inadequate, depending on your point of view. I am at a loss to understand the minister's objection to the discussion of rates of pay.


Lester Bowles Pearson: May I just say a word. In this resolution, of course, we are dealing among other things with the report of what is called the Heeney commission on personnel administration in the public service, a report to which the minister himself has made reference in his observations. Surely we can discuss this report if the minister can discuss it. One section of this report deals with "compensation and allowances". In fact, 79951-0-324
Civil Service Act
certain recommendations are made by the commission on compensation and allowances. Surely we have the right to deal with that section. Surely we also have the right to criticize the government, if we so desire, for the way in which it has handled these recommendations and, if we can find them, to give illustrations to show that this matter has been badly handled. But how can we do that without dealing with the question of civil service wages and salaries?


Charles Edward Rea: I do not think the hon. member for Hull was referring to the Heeney report at all; I think he was referring to the other report.


Alexis Pierre Caron: I was dealing with the report produced by the civil service commission. We are dealing with a change in the Civil Service Act. We have not received the bill. We do not know to what extent the government is going to act in this respect. I know that at the present time the civil service commission recommends the increase of salaries. Hence it is the civil service commission which is to be discussed because they have the power of recommending salary increases. Therefore I do not believe we can be stopped. Otherwise we would not be able to discuss the matter at all.
(Translation):
Mr. Chairman, I was no longer talking about salary increases; I dropped that subject a good while ago and I wanted to deal with something else. But, when the civil service commission made its report on recommendations for salary increases, the government refused to reveal its contents to the civil servants and refused-
(Text):


Charles Edward Rea: Order.


Alexis Pierre Caron: No, Mr. Chairman. I want to bring forward something with respect to the new commission.


Charles Edward Rea: I must be fair with the hon. member. However, I am trying to explain to him that we are not supposed to be discussing rates of pay and salaries. If he can show me that what he is going to say is relevant to this resolution, I shall be happy to hear it.


Paul Joseph James Martin: May I say something on the point of order, Mr. Chairman? It seems to me, first of all, that the point made by the hon. member for Bonavista-Twillingate is one that cannot go unchallenged; and it cannot be said that the hon. member should have raised that point at another point in our proceedings. I assume that the hon. member for Bonavista-Twillingate assumed, as have

Civil Service Act
we all, that the resolution before the committee was one that dealt with the expenditure of public money. If that is the case, it is inconceivable that the expenditure of public money, in the particular context, could have reference to anything but salaries paid to those in the public service.
If that is not the case, then the question put by the hon. member for Bonavista-Twillingate is certainly not one that must go unanswered. Otherwise the resolution is not one that deals with any money matter whatsoever. But that cannot be the case because the minister himself, as we were reminded by the hon. member for Ottawa West, pointed out that it deals with proposed expenditures. It deals with the particular question of pay to servants in the public service, the very matter being discussed by the hon. member for Hull. The Heeney report to which the Leader of the Opposition directed our attention certainly is one that involves pay to officials. If that report was in order, as Your Honour seems to suggest, then certainly the argument of the hon. member for Hull was likewise in order. Here is what the Minister of Finance said in part. He is talking about what this bill is going to do and he goes on to say this:
The bill will contain explicit provision for the composition of appeal boards under the authority of the commission and for the circumstances under which an appeal may be taken, including the right of appeal against a departmental recommendation to dismiss an employee.
If that was the only kind of thing that was included in the resolution, certainly the point made by the hon. member for Bonavista-Twillingate would be unanswerable. But it does not deal only with that kind of matter. The hon. gentleman goes on to say this:
In keeping with the spirit of the times, recognition is given to two important principles which have engaged the attention of staff associations within the civil service; first, that the pay of an employee is a matter not of grace but right,-
If it is not a matter of grace but right surely it ought to be open to the hon. member to argue what is a matter of right or what should be regarded as a matter of right, namely because of the insufficiency of the remuneration extended. Then he goes on to say:
-first, that the pay of an employee is a matter not of grace but right, and second, that consultation between the staff associations and appropriate officers of the government or the commission on questions of pay and conditions of work as the need arises is desirable. These principles are either expressly recommended or implied in the Heeney report.
The Heeney report at page 13 states this:
The present Civil Service Act imposes upon the commission sole responsibility for making recommendations-


Charles Edward Rea: Order.


Paul Joseph James Martin: I just wanted to point out-


Charles Edward Rea: I think the hon. member is reading from the Heeney report.


Paul Joseph James Martin: Which is the basis of this argument. I am just trying to point out that it is in order. I am just trying to point out what the particular paragraph in the Heeney report says in order to show that the argument made is certainly one that is valid. It states as follows:
The present Civil Service Act imposes upon the commission sole responsibility for making recommendations to government on the remuneration-
I hope Your Honour will do me the honour of listening because this is the crux of the point of issue. Your Honour has acknowledged that the Heeney report should be discussed and of course Your Honour was right in that regard.


Charles Edward Rea: Order. May I just make that point clear. Anything from the Heeney report that is relevant to this resolution may be discussed. I did not say the whole Heeney report could be discussed.


Lionel Chevrier: That includes pay and allowances.


Paul Joseph James Martin: If Your Honour will recall what the Minister of Finance said at the outset, Your Honour will be obliged to recognize that his whole speech was based upon all that is implied, in one way or another, in the Heeney report. But I was just pointing out this one paragraph in the Heeney report to show this. To do so may I remind Your Honour, if I may have Your Honour's attention, of the concluding words that 1 quoted:
These principles are either expressly recommended or implied in the Heeney report.
That particular paragraph, which I will read again, commences as follows:
The present Civil Service Act imposes upon the commission sole responsibility for making recommendations to government-
These are the important words.
-on the remuneration of all employees in the civil service and leaves to government the authority to make final decisions, subject of course to the will of parliament in the appropriation of the necessary funds.
In the light of all this, with respect and confidence I submit to Your Honour that the argument of the hon. member for Hull was in order. If it was not in order, then the Minister of Finance must explain why he precedes the introduction of this bill by this resolution. He is then obliged, it seems to me, to meet the argument put forward by the hon. member for Bonavista-Twillingate who questions-if

the argument against the petitioner is unsound-the necessity and the form of the resolution before us. We cannot have it both ways. I submit, for these reasons, that the hon. member for Hull was certainly in order.


Charles Edward Rea: The question of whether or not this is a money resolution should have been raised, I believe, when Mr. Speaker was in the chair and before the house was ordered into committee. That would be my thought on that matter. Therefore I am sure the hon. member for Hull will co-operate with the Chair in his remaining remarks.


Lester Bowles Pearson: Mr. Chairman, in our discussion of this resolution we assumed the resolution was preparatory to the introduction of a bill which would require direct expenditures. That being the case those direct expenditures would have been on the public service, and of course it would be impossible to discuss those direct expenditures on the public service without discussing rates of pay, conditions of service and all that sort of thing. If this does not involve direct expenditure and the Minister of Finance has somehow given us the impression that it does not, citation 277 (2) of Beauchesne's fourth edition says:
A bill, which does not involve a direct expenditure but merely confers upon the government a power for the exercise of which public money will have to be voted by parliament, is not a money bill and no resolution is necessary as a condition precedent to its introduction.
Therefore this bill presumably does involve direct expenditures on the public service, and surely when discussing a resolution preparatory to a bill of this kind we should be permitted to discuss the nature of this direct expenditure, rates of pay, conditions of work and everything which goes with direct expenditure. Otherwise discussion becomes limited to the point where it may be even meagre.


Alexis Pierre Caron: I want to say something on this point.


Charles Edward Rea: I think the Chair has heard enough. However, I would be happy to hear the hon. member again if he desires.


Alexis Pierre Caron: We read in the Ottawa Citizen of today:
The government has not yet received a recommendation from, the civil service commission on salary increases for postal employees-
According to this the government said today that it had not received-


Some hon. Members:: Order.


Charles Edward Rea: Order. I cannot understand what that has to do with this resolution.
79951-0-324J
Civil Service Act


Alexis Pierre Caron: It concerns salaries and the civil service commission.


Charles Edward Rea: Nowhere in this resolution can I see anything to do with rates of pay, and I have no alternative but to give my ruling and hope that the hon. member will co-operate with the Chair. I cannot see anything about rates of pay in this resolution.


Lionel Chevrier: Mr. Chairman, you have not dealt with the point raised by the Leader of the Opposition and the hon. member for Bonavista-Twillingate. I think it has been made quite clear that it was impossible for us to raise the point until we knew what the position was, and it arose in answer to the two questions which I asked the Minister of Finance as to what the resolution meant and what the expenditure was for. It may well be that Your Honour was right in suggesting you had no power at the time, but now that we know and we are advised of the position, as has been explained by the Leader of the Opposition, I want to make a motion and I hope you will accept it. I move that we rise and report progress and ask leave to sit again, so that we can get back into the house and bring the point to the attention of Mr. Speaker as would have occurred in the first instance.


Charles Edward Rea: Would the hoii. member give me that in writing.


Lionel Chevrier: Yes.


Charles Edward Rea: May I ask the hon. member if he has put "later this day"?


Lionel Chevrier: Yes, I have.


Charles Edward Rea: Just to clear up a point, as the hon. member for Hull has the floor it would take unanimous consent for me to accept this motion. I assume the committee will give unanimous consent?


Alexis Pierre Caron: In that case I would be ready to move this motion.


Charles Edward Rea: It is moved by the hon. member for Hull that the committee rise, report progress and ask leave to sit again later this day, for the purpose of raising a point of order concerning the resolution.
Motion negatived: Nays, 43; yeas, 13.


Charles Edward Rea: I declare the motion lost.


Lester Bowles Pearson: Mr. Chairman, in order to clarify matters may I ask exactly what the ruling is now under which we are not allowed to pursue this discussion? Have you ruled that it is out of order to deal with government policy with regard to civil service rates of pay and such matters?

Civil Service Act


Charles Edward Rea: No. I just said that the hon. member should not discuss rates of pay.


Lester Bowles Pearson: Have you stated that if he tried to discuss rates of pay in connection with government policy he would be out of order?


Charles Edward Rea: I hoped I had made myself clear before.


George James McIlraith: With great respect we will have to appeal the ruling. A whole section of the Civil Service Act deals with rates of pay and compensation. It is part II of the act and it is entitled "Organization, classification and compensation of the service". Sections 11, 12, 13, 14, 15, 16 and 17 have to do with that whole question of rates of pay in the service, and if we are to discuss an amending bill replacing the existing bill but are not allowed to discuss the subject matter under that part of the act, with great deference we shall have to appeal your ruling.


Donald Methuen Fleming: Mr. Chairman, before you complete this matter let me say at once-and I think what you said earlier is quite in accord with this-that there is nothing to prevent anyone discussing the machinery which the act creates or which the old act contains in regard to how rates are arrived at. Nobody questions that. The machinery is in the present act and there will be machinery provided in the new bill. But what it seems to me is not in order is to discuss particular existing rates or what should have been done with a particular rate. That does not relate to the machinery by which rates are arrived at. That is all this measure does. It deals, among other things, with the machinery by which rates are arrived at. It does not set rates at all. What has been left undone in relation to the establishment of particular rates may be discussed in the committee of supply on the supplementary estimates.


Alexis Pierre Caron: Mr. Chairman, on the point raised by the minister-


Charles Edward Rea: Order. The hon. member for Ottawa West has moved a motion. I am a little at a loss to understand how I could accept the motion. I have made no ruling since we voted on the amendment. That ruling was made before we voted on the amendment. I do not see how we can go back. (Translation):


Alexis Pierre Caron: Mr. Chairman, that is precisely what I was doing; I was discussing the agency through which the civil service establishes and recommends pay rates for government employees. I hope I am quite in order if I keep within those limits.

There is one thing I wanted to point out, namely, that civil servants are in a position of inferiority. A report was prepared, but they were not allowed to see it. They wanted to discuss it with the proper authorities, but were not informed of its contents.
I would suggest that the government include in its proposed amendment something to the effect that, in matters pertaining to salaries or working conditions, a representative of each civil service organization sit in on civil service commission meetings. Thus they would be kept informed of matters under discussion, and could submit their views. There would be no more of those secret reports so familiar to the Minister of Finance.
The main grievance, I think, is against the way the matter is handled. Civil servants are treated as underlings by the Minister of Finance and the government. That is the point of my objection. They should not be placed in a position of inferiority; on the contrary, they should be given an opportunity to defend their own interests. I am not referring to any specific amount, but to working conditions, and particularly to the procedure for preparing recommendations to be submitted to the civil service commission.
The civil service commission has done its duty, and deserves no blame, but I do blame the government for failing to disclose the contents of its report. The minister, in particular, refused to say a word, and I think he is to be blamed for that.
Precisely as a result of the attitude displayed by the Minister of Finance, civil service associations have lost confidence in the government. They want their demands to be more thoroughly considered.
We also protest against the introduction of this resolution at the end of a session, at a time when there is still a considerable amount of important legislation to be passed, and when there are committees requiring our attendance.
The government does not seem concerned about its attitude. They want us to rush through legislation that we cannot accept without thorough consideration. It is a kind of steam roller, or what one might term a form of indirect closure.
We are not afforded the opportunity of giving proper consideration to the resolutions submitted. A rule of closure that we cannot accept is being imposed.
Mr. Chairman, I maintain that in the present circumstances there is only one way to deal with this; the minister should move

the first reading of his measure and supply us and the civil servants with the information required for consideration.
Thus, we could come hack at the next session well prepared, ready, acquainted with the measure and the spirit that prompts it.
I have always dreaded the Conservative spirit in this country. That is why I wish to have the opportunity to study this bill and to understand its essence so as to be able to discuss it properly.
For all those reasons, I urge the minister to give the bill only its first reading, so that we may have time to consider it and to take it up in detail at the next session.
(Text):


Mr. Howard:: Mr. Chairman, I endorse the validity of the suggestion made by the hon. member for Hull concerning the introduction of this bill and its study not only by the select committee but by all those affected. There is one way of meeting the problem of having the bill adequately studied and passed during the present session of parliament. That would be for the government to arrange a summer recess and to return in the fall so this and other matters could be studied in the intervening period.
I will today discuss the method by which salary scales have been arrived at and suggest an alternative method. The government has followed the old process of divide and rule by its action in the past few months in arbitrarily establishing salaries. This has tended to make some branches of the public service a little happier while curtailing the legitimate activities of civil servants to secure bargaining rights. This is the age old employer tactic of preventing people from having a voice in their own affairs and should not be followed by the government. The bill should reflect the right of individuals to bargain collectively with their employer, the government of Canada. If the bill does not reflect this principle it will fall far short of being a full solution.
Public servants have been concerned about this matter for some time. I am sure all hon. members have received many letters on the subject including form letters probably prepared by civil service associations. Although the minister may consider that the letter I hold in my hand expresses the position in violent language I propose to read a portion of it to indicate the feeling of civil service associations in this respect:
Sir, as a civil servant I feel strongly regarding the morally dishonest manner in which the present government has misled both the civil service and
Civil Service Act
the public. I object to the misleading statements made by the Minister of Finance in this respect. I feel that I have the right to question the honesty of intent of the Minister of Finance in his reference to personal income taxes and in his presentation of other data.
I now ask you as my member of parliament, and in the interests of the efficient administration of the government of Canada, to take a special interest in the proposed changes to the Civil Service Act.


Thomas Miller Bell: If the hon. gentleman is going to read this letter I ask him whether he would give the name of the author of it and lay it on the table?


Charles Benjamin Howard: No, I am not going to give the author of it.


Thomas Miller Bell: You cannot read it.


Charles Benjamin Howard: This, Mr. Chairman, is one of many, many letters that I have received., I indicated earlier they were printed.


Edwin William Brunsden: Inspired?


George James McIlraith: No, not on this subject; they do not have to be inspired.


Charles Benjamin Howard: I continue:
I ask you to consider what the government-


Thomas Miller Bell: Surely, Mr. Chairman, the hon. gentleman cannot read it unless he is prepared to disclose the author.


Murdo William Martin: May I say a word on the point of order. Not so very long ago, on a similar matter, the hon. member for Assiniboia challenged-I forget the name of the hon. member-


Lester Bowles Pearson: We remember it.


Murdo William Martin: He was from Saskatchewan.


John Whitney Pickersgill: It is the hon. member back here from Alberta.


Murdo William Martin: Yes. At that time he was challenged to name the author and he refused. He took it on his own personal responsibility to quote the letter. I believe it was the hon. member for Wetaskiwin.


Mr. Speakman:: Mr. Chairman, on a question of privilege, since my name has been mentioned, I took the statements from the letters as my own.


Mr. MacLean (Winnipeg North Cenlre):: the hon. member wants to take the statements in the letters that he is reading and support them, then he can do so.


Charles Benjamin Howard: May I say one word. These statements are mild compared with the ones I would use in condemning this government.


An hon. Member:: Use your own, then.

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Charles Edward Rea: I think it is quite obvious that if the hon. member does not wish to disclose where the quotation comes from then, of course, he must himself assume the responsibility for what he is talking about.


Richard Albert Bell: But he does not.


Charles Benjamin Howard: Yes. I continue.
I ask you to consider what the government proposes to substitute for the confidence that it has destroyed,-
I think it has destroyed confidence.
-for it has now become clear that 200,000 citizens, taxpayers, voters, and civil servants need the protection of collective bargaining rights to ensure straightforward dealing.
As I said, I wish to make only a few comments on that to indicate the feeling of the civil servants across this nation who have sent these letters to many, many people. It is a key point of bargaining rights that I am leading up to. I do not think anything else, regardless of whether it is a benevolent attitude at election time or at any other time to establish upward adjustments or otherwise in civil servants' salaries, will meet the point. The main point is that here are many thousands of people in the public service of Canada who do not have the rights that are enjoyed by countless thousands of other people across this nation, namely the human and civil right to make a determination of, or participate in making a determination of their own, in consultation and discussion with their employer, a determination of what their working conditions, wages and other provisions relating to their work will be.
As the committee knows, I introduced a bill earlier this session in this regard. There was some discussion of it. I do not intend to go into it. It was a bill to amend the Industrial Relations and Disputes Investigation Act. It was designed to make that act, with some exceptions, applicable to the public service of Canada. It met with a number of objections. What I should like to do is to lay the groundwork here to indicate what I think should be included in the bill when it is presented to the house. These objections revolve mainly around the fact that in the final analysis parliament should have the right to determine what the salary structure will be and what wages will be paid to civil servants, since parliament has the right to decide in the final analysis what all other payments out of the public treasury will be. Perhaps there should be a modification of the original thoughts that I had on this matter to meet this point. I think that a conciliation board or an arbitration board, or whatever you wish to call it, should be established, although in the strict sense of the word it

would not be an arbitration board that I intend to suggest but a conciliation board of the public service of Canada.
I think the public service should have the right to proceed to such a board if it cannot find satisfaction in its contract negotiations and at other stages. I think that a report of this board should be tabled in parliament and that parliament itself should make the final recommendation so that parliament would then have the final say as to what rates would be applied to the public service rather than have the minister in his ivory tower decide what those rates would be.
As I said earlier, he is now doing that in an arbitrary and discriminatory way. There is some reference also in the initial Industrial Relations and Disputes Investigation Act to the fact that perhaps the definition section there of employee is not strictly applicable to the public service because certainly the structure of the public service is not strictly comparable with any private industry and perhaps there should be some modification there.
With these two modifications that I have suggested and the one that I initially proposed, namely that there should not be the right to strike, we think the provisions of the Industrial Relations and Disputes Investigation Act, if the government so desired, could be properly embodied within the Civil Service Act, to set up the machinery whereby the civil servants could reach fair and just settlement and equity in their dealings with the government, not only with respect to wages and salary adjustments, but also with respect to the resolution of disputes and differences of opinion between the time when they are actually bargaining for an alteration in any collective agreement that they may have and other times. This relates to such things as classifications of employees, promotions and allocations within different departments, rates of pay and whether they are receiving a fair rate of pay for the particular type of work they are doing, and all of these other matters which will arise from time to time in any organization. When a person feels he is aggrieved and has a grievance he should have the right to proceed in this instance to the board of arbitration to determine whether or not he is right in his suggestion that he has been aggrieved.
I think, Mr. Chairman, this is the key point to which we should direct ourselves. I refer to the giving of bargaining rights to civil servants, to the people in the public service, to determine, as all other employees in industry have, their own destiny to a degree; the right to form themselves into organizations, to bargain collectively with

their employer. This is the basic human right that we think should be embodied in the Prime Minister's bill of rights if and when we get around to seeing it. But this is one of the rights that I think individuals within the public service should have just the same as people in private industry have. Without this right, without providing the machinery by which a member of the public service of Canada may state his objections, without the right to a piece of machinery through which he can express himself, and collaborate with others in a similar class of work, and attempt to deal with his employer; without those rights placed in the Civil Service Act we shall continue to have the recurrence, maybe not year after year but time after time as the years go on of the attitude that is existing at the moment among many of the people in our civil service.
The attitude expressed in the form letter I read earlier also expressed my views, and I say it is not good for our public servants to have this sort of attitude toward the government. It is not good to have a policy toward the public service that continually makes for dissatisfaction and causes some employees to leave the civil service and seek other fields of employment because there is a better opportunity for the expression of themselves as individuals in private industry. We should not allow a situation to continue which creates such hard feeling.
Similar conditions have existed in other provincial and municipal governmental organizations. I do not intend to go into those at the moment because they involve other jurisdictions, but I think we can certainly profit from the attitude of one provincial government and take a cue from the manner in which it has dealt by legislation with the rights of the individual members of its public service. If the minister would do something of that nature I think he would do a great deal to dispel the frustration and anger existing among our civil servants at the present time and help greatly to prevent a recurrence in the future.


Mr. Nielsen:: Mr. Chairman, I have been waiting since the beginning of the session to bring up a matter which is of concern to civil servants in my riding. In view of the ruling of the Chair as to rates of pay, it is doubtful whether I can go too deeply into that aspect of what I intended to say this afternoon. The subject to which I wish to draw the attention of the committee and the minister is the matter of isolated post allowances, which may not properly be considered as pay of civil servants. I will not go into the question of rates but rather will deal
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with the method of arriving at the isolated post allowance paid to civil servants in the north.
In the more remote areas of the north civil servants are paid an allowance over and above the rate of salary they get, and in order to arrive at this allowance four factors are taken into consideration. Among the factors is one concerning the cost of living and another concerning the supplementary cost of living. The method of arriving at the cost of living and the supplementary cost of living allowance is one which in my view is producing certain inequitable results so far as the actual rates are concerned.
The previous government set up a committee known as the interdepartmental committee on isolated post regulations, and the recommendations of that committee are either accepted or rejected by treasury board in arriving at the rate of allowance to be paid to the northern civil servant. In arriving at an assessment of the factors in order that a rate of allowance may be calculated the committee has recourse to information provided on certain forms which are supposed to be completed by civil servants in the north. In the past these forms have been poorly distributed and have not been fully completed. As a result erroneous information has come to the hands of the administration both prior to the time that present government took office and subsequent thereto.
I suggest that a more accurate method of assessing the factors which are properly considered when arriving at the rate of allowance to be paid would be to conduct an on the spot survey of conditions in the post which is being assessed. The cost of living allowance, of course, has to do with the cost of food in these remote areas, and the supplementary cost of living allowance has to do with the cost of other goods and services supplied in the area which may be under examination. Recently there has been a reduction in both these allowances on the recommendation of the interdepartmental committee on isolated post allowances, a committee which incidentally, is composed entirely of civil servants. In effect, therefore, it is a recommendation made by civil servants for a reduction in the isolated post allowance of civil servants.
I think the information the committee had on which it based its recommendation for this reduction was far from complete. As a result, I feel that a more accurate assessment should be made and in the meantime any positive action with relation to a reduction of these allowances should continue to be suspended. For instance, at the moment the method of calculating the cost of living allowance is

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by determining the relative difference between the cost of food in Vancouver or Edmonton and that in the given location in the north. I feel that the calculation of the allowance by relying on the relative difference is wrong. What should be done is to conduct an on the spot survey of the cost of food in any given location and upon that basis the rate of allowance should be arrived at.
As to the supplementary cost of living allowance, the cost of other goods and services in the remoter northern areas should be assessed and likewise calculated. This is now calculated simply by an arbitrary guess as to what the allowance should be. The method which I suggest should be adopted is an on the spot survey of the actual cost of other goods and services in these various locations. If this method is substituted in each case for the method employed by the previous administration and still carried on by the present administration, perhaps because the matter has not been brought to the minister's attention before, I think a much more accurate assessment of such allowances could be made. With these few remarks, Mr. Chairman, may I say it is my hope that there will be some provision in the new act or the regulations that will be made thereunder which will result in a revision of the method of calculating these allowances so that a much more accurate and equitable allowance may be paid.


George James McIlraith: Mr. Chairman, the legislation we are now discussing has been described by the Minister of Finance as having its origin in the 1918 act. A technical argument could probably be made that the principle of the merit system was attempted to be introduced in earlier legislation, but in any event the 1918 act certainly was a landmark on this subject and was properly described by the minister as such. I think the people of Canada owe a great debt of gratitude to the Hon. A. K. Maclean who presented the legislation and piloted it through the house and to men like the Hon. Newton Wesley Rowell, afterwards chief justice of Ontario, for the contribution they made in that regard. It seems to me that in their remarks they showed an appreciation of the problem and suggested methods whereby real strength could be achieved in the administrative arm of government which have served as a good base on which to operate.


Richard Albert Bell: What about the leader of the administration, Sir Robert Borden?


George James McIlraith: I am just coming to that, if the hon. member for Carleton would be just a little patient he would see that all things come in their proper place.


An hon. Member:: Sometimes it is the reverse.


George James McIlraith: I do not know what is reversed about it. The minister of finance introduced the legislation in that time because apparently at that time the secretary of state did not have so much to do with the legislation. In the last number of years it has been the responsibility of the secretary of state and I, for one, am thoroughly mystified as to why the Secretary of State is not presenting this legislation today.
Be that as it may, when I started my remarks I was mentioning the importance of principles laid down by former leaders. There is a particularly good reference from the leader of the union government, when he spoke about the civil service being free from the maligning influence of patronage. The whole attempt has been to get away from that patronage and establish a truly merit system of appointment. I, therefore, welcome a review of this legislation at this stage to see what improvement can be made.
It is rather interesting that the1 last government, when the new chairman of the civil service commission, Mr. Heeney, was appointed, directed him to deal with this subject, to examine the whole subject and to make a report and recommendations. The new government when it came in renewed that direction in very similar terms. Clearly, Mr. Chairman, I take it there was no difference in the reference intended, so we have the Heeney report to which the Minister of Finance, in introducing this measure, made so much reference. There is a particularly good paper dealing with the subject of the Heeney report by one of the commissioners of the civil service commission, Mr. Paul Pelletier, on October 23, 1959. This will be found in the proceedings of the 11th annual conference of the institute of public administration of Canada. There is an abundance of good material on this subject and, quite frankly, in discussing a subject which is so wide there is some difficulty in knowing just which segment should be discussed.
I wanted to raise one more matter, and I think in order to do so I should quote a line or two from the Heeney report. This will be found on page 8 of that report, paragraph No. 17. It reads:
Law alone cannot guarantee good administration, but it can and does have a real effect on the quality of the personnel who are recruited and it can provide incentives to good performance.
There is more said about the subject, and then the report goes on to say this:
The effectiveness of the present act in protecting the national service from these traditional abuses-

Referring to the abuse of patronage and other abuses.
-is a convincing argument for the preservation of the essential legal safeguards of the merit principle.
The minister indicated he was attempting to preserve and strengthen that principle in the legislation he is seeking to introduce. I feel that that paragraph makes it clear that there are two principles that are involved in developing a healthy and strong civil service. One is the legislation itself, and that has been relatively good legislation in this country and we hope the new bill will be a good bill when it comes before us, and the other thing is the attitude of the government itself toward its own administrative arm.
I am bound to admit that as I studied the history of Canada I have observed over the years, differing attitudes by different governments to the administrative arm of government. There have been periods when, unfortunately, the treatment of the civil service was not such as most of us in this house would wish. Since the recent change in government I have, at times, been somewhat concerned with the attitude of this government toward the civil service. The Minister of Finance, I am quite sure, as time goes on and his experience continues will come to the conclusion that his method of handling the pay increases over the last year-quite in addition to the question of the pay increases themselves, the amounts and so on-leaves something to be desired. It seems to me that it does not reveal on the part of the government an appreciation of the proper place of the civil service in the functioning of government in Canada. I could labour that subject for some time, but I hope the minister will pay more attention to that subject in the future so that we will not have the same rather peremptory announcements such as were made during the last year. I must say, frankly, that I had regarded the Civil Service Act as doing one outstanding thing and that was setting up a commission that was answerable to parliament.
There are quite adequate safeguards in that, such as the provision that the chairman of the civil service commission can only be removed by a joint address of the two houses of parliament, which is the method of removal that is made applicable to judges of the supreme court. Here we can see the lengths to which our predecessors went in seeking to guarantee the independence of the civil service commission from partisan interference by government. I do not want to reiterate a debate that took place earlier as I am not 79951-0-325
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sure of the extent to which I could do it, although I believe I could bring it under the rules.
I must say I was shocked with an answer given by the Minister of Finance when he was asked to table a report of the commission to the government. Possibly the nature of his answer was dictated by the procedure on motions for the production of papers which would not permit the minister to debate the matter. Perhaps I should be charitable to the minister as certainly the answer was in an abbreviated form, and the form in which it appeared on that occasion was such as to weaken the confidence of the public service of Canada in the government's attitude toward that service.
I could pick out other points, but perhaps I have said enough to indicate that I am very concerned that this legislation being introduced shall in no way weaken that principle of the independence of the commission from the partisan influence of the government of the day. This principle should be preserved and strengthened.
There is another point that concerns me greatly. The last really thorough study of the civil service was in 1938 and 1939. I was interested in noting, when I sent for the evidence of this committee, that the special committee of 1938 held some 48 sittings. The committee was reconvened in 1939 and held nine meetings. In other words, on that occasion some 57 meetings were held on the Civil Service Act. This leads me to say that in my opinion no government of Canada can be really effective in the interests of the public of this country without a strong and competent civil service, a civil service with a high morale and efficiency. I believe we have such a service, and I believe it is important that we always have such a service.
We are told by the minister that the legislation now coming before us is going to be longer than is the present act. The present act has some 65 sections to it. It is divided into five parts, one part which, by the way, seems to deal with the subject of compensation. I will not elaborate too much on that matter. However, to deal with that act and to review it required some 57 meetings of a special committee the last time it was done. We are now going to be asked to review the whole subject matter and to consider a new act that is longer than this one of 65 sections and to do it all, as the minister said, "I hope rather hurriedly" this session without having the opportunity to think about them.
I am going to make a direct appeal to the minister to consider this whole matter in order to ascertain if the interest of the country would not be better served by allowing this bill, once it is introduced and is

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given first reading, to stand over so that a committee can be set up at the start of a session, one that can look forward with interest and eagerness to holding 57 sittings or more, if necessary, in order to deal with this matter thoroughly and to give it the kind of treatment it deserves.
I have had some opportunity of dealing with civil service associations, civil service bodies and civil servants individually and I think I can assure any committee to be set up that some numbers of civil service associations will wish to be heard. I think it is appropriate and proper that they should be heard. The act, the regulations thereunder and the procedures are quite cumbrous and quite involved. They are not simple things that can be dealt with in a few minutes. I would hope that all these organizations would feel that they are going to have the opportunity of being heard, of making full representations and of submitting to examination by members of the committee so that the bill as it is finally enacted by the house will be one that will meet all the requirements of good government, that will have been examined thoroughly and that the civil service-whose charter it will be, in reality- will feel that it has been competently examined by the house and by the committee.
I therefore repeat with all the strength at my command the request to the minister to reconsider this matter, that he let the bill, after first reading, stand over and have the committee set up immediately after the throne speech so that the months required for full examination of the bill may be available.
There are many subjects, briefs and sections that will require to be examined. Any lesser treatment of the matter is not one that will serve the interests of the country or of the government adequately and well. I perhaps have no need to draw to the attention of hon. members the fact that this is the 106th day of the session. According to my arithmetic, if the committee were to hold the same number of meetings as the former committee held, it would be the 163rd day of the session, if the committee held a sitting every day from now on for the rest of this session, before it could even start to prepare its report. From this calculation hon. members will see just how serious this matter is and I hope they will join me in the request I am making to the minister.
A good deal could be said about governments of the day. It seems to me that the situation is this, as I have been able to study it. If you examine governments since confederation, Mr. Chairman, you will find a rather interesting coincidence, namely that

governments which have been incompetent, if I may use that word, or which have been antagonistic in their handling of this subject or which have misunderstood the role of the civil servant in the art of government or in the business of government have tended to be weak governments and have tended to destroy themselves. It is a rather interesting study for anyone to pursue. While I cannot express too many wishes for the present government, I would hope they would not fall into the error of treating this subject in any way less seriously than its inherent merit demands.
There is a great range of subjects requiring discussion. I noted that the minister indicated he is changing the provisions having to do with the pay of an employee of the crown being a matter of right instead of a matter of grace, following a principle that was laid down in the civil service superannuation legislation some years ago. Then he mentions that consultation between the staff associations and the appropriate officers of the government or the commission on questions of pay and conditions of work as the need arises is desirable. There is a whole area of discussion there. I do not propose to spend the rest of the time allotted to me this afternoon in discussing it. But because of its complexity, that subject alone deserves close attention from all hon. members. I am not sure just what the minister meant in that reference or just what he proposes in the legislation. We look forward with interest to seeing what the legislation contains on that subject. With the growth of the service and with the changing ideas of our times it is readily apparent that the present method of consultation is not working efficiently and is not adequate as in regard to the present needs.
I must revert to an earlier point. I place a little bit of blame for that situation on the minister's attitude or, shall I say, his failure to understand the whole subject and his failure to give to the workers in the service the confidence which they deserve and to which they are entitled as long as they are doing their work efficiently and in the interests of the country.
Then there is this other matter mentioned by the minister, namely the changing situation to be covered by legislation, the matter of the veteran preferences in relation to such things as the war in Korea which did not involve the kind of declaration of war envisaged by the earlier legislation and matters of that kind. We could go on then into this whole question of existing legislation, the method of the rates of pay, the rates of compensation for new classes; the method of

submitting the reports for the rates of compensation; to whom are they to be submitted; what is the method of handling them after they are submitted; what is the method of having them made public; what is the method of having them made available to parliament and so on. I think that whole sector of the act needs strengthening and needs to be brought up to date. On that point I await with interest the provisions of the bill.
Again I do not want to revert to something already dealt with, but I must say I was rather shocked at what I thought was the limitation the minister was seeking to put on the debate. That is past now, but the whole matter not only of rates of pay but of methods of determining and examining them to see that they are adequate, and so on, requires minute consideration by some appropriate procedure of parliament, which in this case I would say is the special committee. Then there are all the other matters to be considered, such as the development of the Whitley councils as they were first created in the United Kingdom a number of years ago and their adaptation to this country, the modernization of them to meet modern needs, the extent to which they should be adopted, modernized and improved, and the extent to which they should be discontinued because they may not be quite up to date. All that covers a vast area.
It is not my purpose to develop the argument any further at this stage. I for one want to see this bill. I hope it will be possible, when the bill is made available to me, to have a proper opportunity of reading and studying it thoroughly and that I will not be expected to deal with it in a rush at the committee stage when we have such important committees sitting as the committee dealing with the combines legislation, the committee dealing with broadcasting and the committee dealing with the bill of rights.
Therefore I conclude my remarks with the reiteration of my request to the minister to lay before his colleagues consideration of procedure from here on in the handling of this piece of legislation. As I said, when the act was previously before the special committee in 1938 and 1939 it required some 57 sittings to deal with it. We are now in our 106th day of this session, and if we are expected to deal with this legislation in a special committee, bring it back to the house and enact the legislation at this session, I am afraid it will get less competent treatment from us than it deserves, and less competent treatment than any one of us would wish it to get. It will also create a situation in the civil service where there will be further demoralization.
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May I point that last factor out as being of some importance, because if the civil service bodies are not given an opportunity of being adequately heard by that special committee there will undoubtedly be the impression created that the government of the day is seeking to force legislation through without adequate consideration. That can be a very important thing when you are dealing with a body of employees running to some 140,000 or 150,000 people. I noticed that the hon. member for Carleton does not like my reference to some demoralization in the civil service-


Richard Albert Bell: No, of course not, and the hon. member does not believe that himself.


George James McIlraith: I repeat my statement. In my opinion there is no doubt at all that there is. It has been created basically through slowness in granting pay increases, as the hon. member for Carleton, if he has anything to do with postal employees these days, will soon know.
I do not think the government's method of handling the increases has been quite up to what it should have been. As I say, I do not propose to state a case. For instance, discussing the question of the failure to make these increases retroactive to the appropriate date, not following the earlier practice in this regard, would occupy me for some time. I could discuss the whole question of failure to deal with what is probably one of the most underpaid classes in the civil service, namely the postal employees. Any suggestion on the part of hon. members that those problems have not caused concern in the civil service is, in my view, not a conscientious and complete picture of the subject at all, and I say it has not been treated in the way it should have been treated.
However, I have made my plea to the minister. I regret there is only one of his colleagues in the chamber at the moment. I do hope that the request I have made gets to his colleagues in the government and that they do consider the matter in the way in which it is put forward in an effort to make sure that this legislation which is being introduced will be the best possible legislation that the house can produce.


Edwin William Brunsden: Mr. Chairman, two or three very definite impressions have arisen from this debate, and may I be permitted a few moments to give my thoughts with respect to them. These impressions arise from the very lengthy and rather tedious remarks of the hon. member for Hull and the hon. member for Skeena to the effect that the gentlemen to my immediate right are the only members of this committee who are interested in

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the Canadian civil service. Let me say, Mr. Chairman, that those of us on this side of the house share with them a deep concern with respect to their futures and that we are determined, as they were some years ago, when they had the opportunity, to do everything possible to safeguard their interests.
There is a factor which has not been mentioned today, and I say this with all due respect to every civil servant in Canada. Much has been said today with respect to the transition of the civil servant to private business, the breaking down, it is alleged, of our civil service organization. The civil servant enjoys something that no other worker in Canada enjoys, and that is a very large measure of security. While there may be times in the course of his active life when he feels he has not been entirely fairly dealt with, he always knows that except for cause he cannot be removed from his office. I say to you, Mr. Chairman, that that is an advantage that should be given some consideration in any discussion of this great working force. I can think of many other groups who have no security; I am not too far from one at the moment. Other groups also could claim they are underpaid. Some members of this group close to me make that claim. I am not among them, but I do feel that there are factors involved in employment in the government service which have not been given the credit to which they are entitled.
Mention has been made of patronage. I am very happy to say as a private member of this government it has been impossible for me to indulge in any patronage. First of all it is not my wish to seek it; second, I could not get my brother, if I had one, appointed as a janitor if there was such a job open. The civil service commission in Canada is doing a most excellent job with respect to the filling of positions. There have been some disappointments of course with respect to appointments which have been made, but by and large I am very happy to say that in my opinion the replenishing of the ranks of our civil service is entirely removed from politics.
So I say that when this resolution is adopted and the bill comes before us it will be the concern of all of us regardless of political party to analyse it from the point of view of the greatest advantage for the greatest number. I am sure the Minister of Finance as he pilots the bill through the house will demonstrate to all civil servants his sincere interest in their welfare.


Mr. Richard (Ottawa East):: Mr. Chairman, after listening to the speech of the Minister of Finance and other hon. gentlemen who have spoken this afternoon I am wondering

if as a whole the committee takes seriously enough the question which is before it. This is not just another act that will from time to time be amended or overhauled. This is the act which affects the working conditions and status of what is the most important permanent administrative arm of the government of this country. It is often said that we have the finest civil service in the world, a great organization, outstanding people. That is all very well. We must ensure that the act governing how they are appointed, the conditions under which they will work, the basis on which they are remunerated, the method by which they will achieve promotions, the regulations concerning their tenure of office, et cetera, is also the finest act of its kind in the world.
This is not a political matter. This subject should be taken out of politics altogether. Up to a point I do not think there is too much cause for complaining that too strong a political element has been injected into the debate this afternoon. However, I feel that if I were to do justice to the importance of the subject before us I and every other hon. member in this chamber who is interested in this measure would speak for at least 40 minutes because the subject is much larger and of greater importance than one would be led to believe by what has been said in the debate today.
Parliament has had no opportunity since 1938 or 1939 to discuss the whole question of the civil service. Last year we had a small review in a committee of the house. The meetings were very friendly. The hon. member for Carleton was in attendance. We were also honoured to have the acting chief commissioner, Mr. Pelletier, present, as well as others who gave us information on conditions in the civil service and the operations of the commission. But that was not the type of study a committee of this house should have given to so broad a subject. There are many serious matters to be considered including the question of the first examination appointment. That is a great question. Promotions is another. There are also the questions of assignment, transfer, tenure of office, removal, et cetera.
Another big question that must be solved is that of consultation or collective bargaining as it is referred to by some. Hon. members do not even know what is in the bill. Perhaps some hon. members on the government side know what is in the proposed bill but certainly I do not. What is more important, those who are affected do not know what is going to be in the bill.
Surely whatever our views on the matter may be we need the assistance of those who

will be affected by this legislation. The civil service associations should have an ample opportunity to appear before the committee. The officers of the commission should also appear. Surely we will not pass a bill without giving ample opportunity to those who want to speak on various aspects of it to present their case before the committee.


Donald Methuen Fleming: I do not know if the hon. member was in the chamber when I said that after second reading of the bill I proposed to ask that it be referred to a special select committee for the purpose of going into the bill in the utmost detail.


Jean-Thomas Richard: Of course I agree with that. My hon. friend does not understand my point.


Donald Methuen Fleming: No, I do not.


Jean-Thomas Richard: The committee in a period of one or two months cannot properly examine the bill and hear all the representations that will be made on it. I congratulate the minister and the government for bringing the bill before us at long last. The act requires revision and it is high time it has come about. I also congratulate the government for having given us an opportunity last year to study the Heeney report. All this is to the good.
My point is that the bill should be introduced now and next year let us go to work early in the session in a special committee and do a thorough job of analysing the measure. The minister should know that he will be the loser if a bill such as this is passed within a month or a month and a half without adequate study having been made. The minister will take all the blame and plenty of blame will be directed at the hon. gentleman because there will not have been an ample opportunity provided for those who wish to make representations to the committee. It will be too late. Afterwards we will find all kinds of holes in this legislation and the blame will be directed to one individual. Hon. members will observe how sympathetic I am to my good friend the Minister of Finance. I am trying to save him that embarrassment.
I will not elaborate at great length because I believe I have made my point. The resolution should be passed, the bill introduced and the minister should agree to delay examination of the measure by the committee until the next session of parliament. The minister pitched one good game this afternoon in the field of superannuation and I do not think the hon. gentleman should expect that his arm is limber enough to enable him to pitch another good game today.
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Richard Albert Bell: Mr. Chairman, no resolution of more basic long range significance has been or will be considered at this session of parliament than this proposal to amend, revise and consolidate the Civil Service Act. However sound may be the other legislation of this parliament, however competent the ministerial direction, all will be found wanting if the subsequent and consequent administrative responsibilities are not fulfilled by a competent, responsible and loyal public service. Everything this parliament does, everything the ministry seeks to achieve, ultimately must be enforced or carried out by public servants of all levels and grades. And so I submit that this particular legislation is basic, is of vital, fundamental and lasting significance.
I therefore deeply regretted the attitude of the hon. member for Hull. Presumably this afternoon the hon. gentleman was spokesman for the official opposition in this important matter. Did he approach this resolution in an objective way? No, the hon. gentleman engaged in a political harangue. The hon. gentleman endeavoured to drag the civil service into politics, to make the act a partisan and political issue. Nothing could be more harmful to parliament or more harmful to the civil service. I say that the hon. gentleman's remarks this afternoon were both cheap and unfair. They were totally without dignity or an understanding of the fundamental precept that the civil service must be above and beyond politics.
May I remind the hon. member for Hull and indeed also remind the hon. member for Ottawa West that it is to a very great Canadian, Sir Robert Borden, and his colleagues that Canada owes the present structure of its civil service. The monument of a civil service appointed on the merit principle, promoted on the same basis, freed from partisanship, the spoils system, the favouritism and the nepotism which plagued our earlier days, is a monument to Sir Robert Borden more lasting than the bronze and granite we observe on parliament hill.
The Heeney report of December, 1958 had this to say of the Borden bill of 1918, the bill of 40 years earlier:
It has been, said that the Civil Service Act of 1918 gave Canada, in a single step, as advanced a measure of public service reform as existed anywhere in the world.
So for more than 40 years the principles of the Borden bill have stood the test of time. To all governments, to all parties, credit is due and let credit be given. Let us keep this resolution, let us keep our discussion of it above and beyond partisanship in this chamber.

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During those 42 years Canada has emerged from colony into nationhood, and the status of its civil service has kept pace with that. Without reservation I submit to the committee that our senior civil servants can hold their own at international meetings, at learned societies and in the performance of their day to day duties with the public servants of any other nation; and this submission, indeed I call it this confident assertion, I would apply to all in less senior roles. That fact itself is a vindication of the Borden Civil Service Act, in principle not amended in 42 years.


George James McIlraith: Will the hon. gentleman permit a question?


Richard Albert Bell: Yes.


George James McIlraith: I agree with what the hon. member says about the civil service. Is that not a pretty good indication of how well the previous government administered the act in the previous 22 years?


Richard Albert Bell: I would like to say to the hon. gentleman that during 42 years I believe on the part of governments generally there has been adherence to that sound principle and there has been in the last three years an adherence to that principle the like of which has not existed in the 22 years previous thereto.
The fact that there has been that adherence would indicate that the modernization of the act, its streamlining, if you like, its up to dating, ought to be in general conformity with those principles which have stood the test of time in Canada's rush from a frontier colony to a nation capable of foremost leadership in the world.
Though Canadians are proud of the standards of our civil service-and have reason, as I have said, to be-that fact must not lead us to smug self-satisfaction or into complacency with the status quo. By parliament and by the civil service itself there must be a constant striving for improvement in the standards of our administration of public service matters. But what I emphasize is this. Parliament must be certain at all times to preserve the great traditions of our civil service. I submit that the legislation which is introduced must be tested on that basis. For those reasons I believe the house and the country will welcome what the Minister of Finance has said in introducing this legislation this afternoon and the assurances which he has given.
The first and the most significant assurance is that the merit principle will be preserved inviolate in the proposed bill. It is the
[Mr. Bell (Carleton) .1
cornerstone on which we build. The Heeney report had this to say at page 23:
It can, we believe, be asserted with confidence that the merit system is a permanent feature of the Canadian philosophy and machinery of government.
Last year, after its detailed review of the civil service commission, the standing committee on estimates ended its report with this uncompromising declaration of the faith of the members of this house, and I quote from Votes and Proceedings of Thursday, July 2, 1959, at page 648:
In reviewing the evidence and the recommendations contained in the foregoing your committee wishes to impress upon parliament the importance and the necessity for reaffirming our belief in the fundamental and underlying principle of the public service of Canada. The principle to which we refer is generally described as the "merit system" which we suggest provides the one assurance that the civil servant wifi remain free from political or other influences in discharging his responsibility to the Canadian public.
This declaration, drafted by the hon. mem ber for Calgary South, but approved unanimously by all members of the committee representing all parties in this house, is a fulfilment of the pledge which was made to the civil service association of Canada by the Prime Minister on May 1, 1958, in what I may describe as a very sympathetic and certainly a very enlightened speech on the subject of the civil service. I quote:
Our revised Civil Service Act, I am sure, will preserve the vital principles of the merit system which have been in our legislation for the past half century. Nowadays we take it for granted that civil servants are appointed and promoted on the basis of ability. We must not forget, however, that this depends upon having the right principles in our law and the effective application of them by an impartial tribunal. This we must preserve.
The public service is so important and its work affects all Canadians so directly, that we need the best men and women in it that we can secure. That is the positive aspect of the merit system- to ensure the selection of those who will do the best job.
So there is embedded in this bill, and for all time it must be a part of Canadian theories of government, the assurance of the practice, the genuine practice of-not just lip service to [DOT]-the merit system. But let us not believe that just the mere assertion of adherence to the merit system is assurance of its practice. Here, as in so many aspects of life, eternal vigilance is the price of adherence to principle. Safeguards against internal abuses, against tailor-made competitions, against favouritism by senior officials, all these are required for the genuine practice of merit in promotions. The Heeney report, at page 8, put it this way and this is a statement always to be kept before us:
Forty years ago, and this is all too frequently forgotten, the need was also for a public service

free from nepotism, the coddling of incompetent favourites, the granting of promotions for consideration and similar internal abuses. Not much is gained if the "malign influence" of political patronage is replaced by bureaucratic patronage, which may be less apparent but which can be no less insidious and demoralizing.
Most emphatically do I agree that bureaucratic patronage is insidious and demoralizing and the new act and its administration must endeavour to eliminate bureaucratic patronage as fully and completely as political patronage. Had I to choose between them, I would support political patronage ahead of bureaucratic patronage, for the politician at least is accountable for his actions. Fortunately that choice is not necessary.
And so, basically, the merit system means simply that appointments and promotions are made on the basis of an objective determination of the relative merit of qualified candidates, under which all qualified persons have the opportunity for consideration for appointments and promotions and under which duties performed are equitably compensated.
I believe it is a major responsibility of this parliament to make civil service employment an attractive and rewarding career for any young Canadian. We need to recruit the very best of our young Canadians for government, government at all levels, not those whose prime interest is in security. To do that, the rewards additional to security must be genuine. Service of the state must be considered the very highest type of service and those who pursue such a career must be given the confidence that they will not be shot down blind alleys, will not have their potential for advancement restricted by red tape, will not have their initiative blighted by needless frustrating administrative techniques, will not have their leadership qualities lost in the giant mechanism of an inhumane bureaucracy.
For that reason, personally I welcome the assurances of the Minister of Finance that the new legislation will provide greater flexibility, greater simplicity in meeting the administrative functions of the departments of government, all without prejudice to the merit system. As I understand it, the proposed legislation will provide for a clearer division of authority. It will preserve unimpaired the authority and responsibility of the civil service commission in all matters dealing with recruitment and promotion. On the other hand, in all matters of managerial concern, greater authority for decision and action will be vested in deputy heads.
I think that is good. It is in strict conformity with the Heeney report and with what I believe are recognized as the best
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principles of modern public administration. What I hope this may be able to achieve is what I might describe as a better internal relativity, that is to say, an improvement in the relationship between various classes of work and rates of pay within the civil service. What we must seek to achieve, and what I believe and hope this legislation will achieve, is the establishment of definite principles of class comparability, a reduction in the number of classifications and the removal generally of discriminations and frustrations, of blind alleys for some employees. This I believe can be accomplished and will be promoted by the principles which have been outlined to the committee this afternoon by the Minister of Finance.
I think the house will have welcomed as well the assurance of the Minister of Finance that there will be no alteration in the independent status of the civil service commission as a quasi-judicial tribunal. This is in accord with the positive assurance given by the Prime Minister to the civil service association of Canada in what I have already described as a powerful speech on May 1, 1958, a speech which, as I have said, revealed a deep understanding of and sympathy for civil service traditions. At that time the Prime Minister said:
The commission is not an arm of the government to which ministers can give direction. It derives its powers and basic instructions from parliament.
That position is fundamental to the preservation of sound principles of recruitment and promotion. Welcome indeed to the whole house, I am sure, was the appointment as chairman of the civil service commission of a man of such distinction as Mr. Justice Hughes. I think he is to be congratulated upon his willingness to leave the security of the supreme court bench, a role which he achieved at a comparatively youthful age, for a term appointment in a difficult and perplexing administrative task. As a friend of his of some 30 years now, may I say I believe the commission is fortunate indeed to have as its chief a man of such civilized mind, such keen perceptions, such articulate capacities and such basic common sense and, as well, one who all his life has been guided by a firm determination to fight for the principles in which he believes.
The minister has indicated that the bill will provide the technique for an ever-increasing participation of employees and their associations in the processes leading to a determination of conditions of employment. That is good. But this I do want to say. Responsibility is a concomitant of authority. Staff associations must display genuine responsibility, moderation in language and

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statesmanship in conduct to ensure an approach to effective participation in bargaining techniques. Abusive language, extravagance of expression and action have no place in civil service negotiations and only succeed in retarding what genuine friends of the civil service seek to achieve.
On other occasions I have spoken in the house about the accomplishments of the present government in civil service matters. Let it never be forgotten that the change of government in 1957 was accomplished with the least upset to the civil service of any change in history. This government has never had enough credit for that fact, for the fact that there were virtually no dismissals, no parade of dismissed employees of the type invariably experienced after previous changes of government. From the very outset this government has not given lip service but genuine adherence to the true principles of the merit system and it is time that credit was given for that fact.
In all its actions the government has demonstrated a sympathetic, understanding approach to civil service problems. Examples are the establishment of the pay research bureau, a matter frequently proposed to the former government but invariably declined; the institution of increases for superannuated civil servants, again a matter for years, sought by them but invariably refused by the St. Laurent government; the institution of a modem medical-surgical plan; the appointment of a justice of the Supreme Court of Ontario as chairman of the civil service commission; the appointment on every practical occasion of deputy ministers from within the service; the institution of a system of class by class increases in salaries with regular and periodic reviews based on the principle of fair comparison. These are but a few of the indications of the genuine understanding of the Prime Minister and his colleagues of civil service administration and problems. This legislation is further evidence of the good faith of the government.
Therefore, pleased am I that the government has decided to send this legislation to a special committee. There in the exchange of opinion, in the clash of what I hope will be non-partisan views, I believe we can bring to relative perfection a bill which for the next 40 years will shine as a beacon of sound, progressive civil service policy as the Borden Civil Service Act has shone for the past four decades.


Murdo William Martin: Mr. Chairman, in listening to the parliamentary secretary I heard him condemn extravagance but I think there is one other type of extravagance which he omitted and should condemn as well, his

extravagance of words. The hon. member also boasted about the fact that the present government has not indulged in the time-honoured practice of mass dismissals since they came to office. If we look back over the last three years I think we will find they have devised a much better method, that of making things so miserable and unpleasant for people that in the end they resign.
When the minister introduced the resolution today he made reference to the Civil Service Act of 1918 as a landmark. From the extent and scope of the amendments now proposed
I	think the minister will agree that the landmark has become rather moss grown over the period of 40 odd years, and we certainly agree that it is time for a thorough overhauling of the act. The minister also made a great point about how the civil service commission has been free from political control. I wish I could be as sure as the minister that that has been the case. I am sure that many people in the civil service do not agree fully with the minister's remarks.
We must remember that the civil service commission or the Canadian government, whichever way you prefer to put it, employs more people than any other single employer in this country. At least, if there is another who employs more I do not know who it is. As has been pointed out today, by various members, I would say that in the last three years suspicion of the government among civil servants has been growing. Because of the delay and procrastination with respect to raising the salaries of civil servants and bringing them up to what they should be to meet the current cost of living we saw a very strong development among civil servants who started working together to present a united front to the government in support of their requests. As was pointed out by the hon. member for Skeena, I think the method of giving increases to certain groups and taking other groups under consideration was devised for the sole purpose of breaking up that solid front. I do not know whether they are taken under consideration or under active consideration but I saw definitions of these two phrases the other day that I think are quite appropriate. I am sure many civil servants will agree with them. The definition of "under consideration" is "we never heard of it" and the definition of "active consideration" is "we are looking in the files for it".
I was never a civil servant but I spent
II	years of my life as a civic servant and there is really not too much difference between the two. I found from personal experience that it was six years after I started to work for the municipality before I enjoyed the same rights as I had enjoyed before entering

the service. It was not until after I had been with the department for six years, five of which I had spent actively in the trade union movement, that we were able to incorporate into our contract a grievance procedure sufficient to protect the members of that local and give them the same rights as everyone else.
Unfortunately these rights have not yet been passed on to the civil servants. They are still in the category of second class citizens. I recall when I first started to take an active part in politics I was warned by well-meaning friends that this was a crazy thing to do; you are going to lose your job. Well, I did, and I sometimes wonder if I improved my lot. The fact still remains that the civil servants of this country have not the same rights as other citizens of this country or as the employees of other employers. It seems that in every country there is a certain class which does not enjoy full citizenship. In India there are the untouchables, in South Africa there is apartheid and in Canada we have the civil servants.
I must confess that I was shocked when I came to Ottawa to realize that for the first time I had the power, without any proof required beyond my say so, to deprive any civil servant of his livelihood. I merely had to state that I knew he had taken an active part in politics. As I say, Mr. Chairman, 1 was shocked because I do not believe I have any right to that privilege, if you can call it a privilege. Certainly there is no other group of employees in this country whose jobs depend upon the whim of any one of 265 people. It is for this reason, Mr. Chairman, that I should like to support the plea of the hon. member for Skeena that when we are conducting a major overhaul of the Civil Service Act we should realize that the civil servants of this country are entitled to the same rights and privileges as any other citizens of this country. These rights should be guaranteed to them.
I agree with the hon. member for Ottawa West, and with other hon. members, who have pointed out that at this late stage in the session, at a time when the annual speed-up has been put into operation, it is no time to start a major overhaul of the act in the hope of getting it passed at this session. I say that during this major overhaul we should give the rights to our civil servants that are granted to every other citizen of Canada and, in addition, we should devote the time necessary to make sure that the job is properly done.
(Translation):


Mr. Lafreniere:: Mr. Chairman, I want to take this opportunity to make a few remarks
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in connection with this resolution. It is obviously important, for the good administration of this country, that employees and employer be on excellent terms.
Everybody will agree that each civil servant, whatever his job, plays an important part in the administration. It is no sin for a man to labour in his vocation, whether it be in the public service or in other fields of human endeavour. Due allowance being made, the humblest of civil servants, is as necessary to an efficient operation of the government machine as the one occupying the highest post, which means that the man in charge of maintenance in public buildings, the elevator operator, the junior clerk doing some obscure and unassuming work, are quite as essential to this country as the highest state official. If people in the humblest of jobs do not play their part with a full sense of responsibility, the whole administrative machine can be impaired.
The civil servant obviously has some rights, but he also has responsibilities.
He has a right to expect some consideration on the part of his employer and to a treatment consistent with human dignity. He has a right to working hours enabling him to fulfil his obligations to the extent demanded by his employer. He is entitled to a salary that will allow him to face his personal and social obligations; in a word, he is entitled to a square deal.
I am sure, Mr. Chairman, that this government is prepared to entertain the fair and reasonable claims of public employees in the matter of salary increases.
But the government is expected to restore within a few weeks, or a few months, a balance which had been upset during the too many years of Liberal rule. Yet, it would be wrong to believe that living costs in this country increased spontaneously, or all of a sudden. If today, federal civil servants' salaries are out of line with the cost of living, it means that there was a lack of the necessary gradual adjustment. The best proof is found in the speech made by the hon. member for Hull (Mr. Caron) on January 25, 1960, when he said:
Some civil servants, because they receive an inadequate salary, have to take other employment in their spare time.
Mr. Chairman, I would not want to press this point unduly, but if civil service salaries

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were inadequate a few months ago, why did not the former administration at the time immediately decide to remedy the position; because, as I said before, the cost of living cannot change and rise all of a sudden, in a single month, or even in a single year. It is a gradual process.
Consequently it must be recognized that in respect of salary increases for the civil service, this government has made a commendable effort to date.
Mr. Chairman, I was just now speaking of the civil servant's rights. Obviously, he has not only rights; he also has duties. And, before insisting on the civil servant's duties, I want to call your attention to the fact that our country is endowed with a system of government of which we are proud, that is the democratic system. As you know, some countries waged, and are still waging, a violent struggle to attain a system of government which ensures freedom to each and every citizen of a country, in accordance with human dignity as we understand it, that is in the Christian meaning of the term.
Under that system, the voice of the people has to be heard and understood by the government. The spokesmen for the people are, of course, the citizens who have been chosen and elected by them, and they are called members of parliament. In their respective communities, those members consider the problems and needs of the people, first through their personal studies and observations, as well as through social agencies that study problems of a sociological character, problems therefore of general interest, for the common weal. In reference to those social agencies, I should like to take this opportunity to draw the attention of the house to the fine contribution made in the form of the very substantial reports coming from the various sections of the chambers of commerce throughout Canada.
In other words, Mr. Chairman, the point I wish to make here is that the democratic system must allow the people to directly influence the conduct of the country's business, allowing them at the same time to guide their political destiny. That is why everything must be done to protect that system of government, so that there may always be, between the people and the government, easy communications as well as frequent and continuous relationships.
The purpose of my brief remarks is simply to point out to distinguished members of this house, wherever they sit, a danger which might make our democratic system inoperative and inefficient.

To put it briefly, Mr. Chairman, among the duties of civil servants towards the government, there is loyalty towards the representatives elected by the people. Otherwise, the civil service would eventually set up an impassable barrier between the government and the people. I am not complaining, Mr. Chairman, of the situation which might have existed in the past or which might now exist; I am making those remarks merely to describe what should be done in my opinion, to safeguard our system of government.
Consequently, civil servants must show great loyalty towards the representatives who have been elected by the people, and give evidence of serious co-operation.
If, after an election is held in Canada, civil servants were to apply laws already enacted by parliament without taking into account the directives or policy of the newly elected representatives of the people, well, as I said a moment ago, democracy would become inoperative, the voice of the people that is, the voice of those who have been vested with the responsibility of administering the country would never be heard.
Mr. Chairman, that is the danger I wanted to point out. I would not like to give examples nor lay any specific charge against anyone, but I say that it is a danger which any government must avoid, regardless of its political creed.
The government is responsible for seeing that the specific mandate entrusted to a member of parliament by his constituents is carried out, and division heads should follow that directive.
Mr. Chairman, I hope that in its amendments to the Civil Service Act, the present government will do something specific and practical about bilingualism and its application throughout Canada, and particularly in the various government departments.
On the matter of bilingualism, the government deserves credit for its practical action in this field. I do not want to take up too much of the house's time to list the government's accomplishments but let me mention the simultaneous interpretation system in the House of Commons-


Paul Joseph James Martin: Proposed by the former government.


Robert B. Lafrenière: -which allows hon. members to express themselves-in reply to the interjection of the hon. member for Essex

East (Mr. Martin), it came as a result of a motion introduced by the Prime Minister (Mr. Diefenbaker).


Paul Joseph James Martin: At the suggestion of representatives on this side of the house.


Robert B. Lafrenière: After consideration by ministers and members of the present government.
In any event, I think if the former government had really wanted to introduce simultaneous translation in the house, it had ample time to do so during its 22 years in power.
It is obviously too late for the former administration to think of things that might have been practical contributions to national unity. That action was taken by the present Conservative government.
Mr. Chairman, may I also express the hope that the present government will look into the causes or reasons for the small number of bilingual people in the Canadian government civil service. In that way, it could determine why there is such an imbalance in the number of French-speaking, as opposed to English-speaking civil servants at the senior levels of the civil service.
In my view, Mr. Chairman, this subject would warrant a thorough examination.
I am not, of course, trying to raise the cry of discrimination; however, in this field as in many others, the former government showed some laxity. That is why we are now faced with such a heavy imbalance in the number of Canadians of French extraction, in relation to Canadians of English extraction, at the top levels of the various government departments.
Mr. Chairman, I hope and trust that the government will take serious note of these brief remarks, because referring to page 22 of the report itself, I find that section 53 reads as follows:
The commission recommends that clear provisions be made in the new act and regulations to ensure that both English-speaking and French-speaking Canadians are served by civil servants in their own tongue.
Of course, Mr. Chairman, we must not overlook certain practical considerations that may exist in Canada, but I see no reason why civil servants draw up reports in what, to them, is a second language.
It might be reported that the hiring of bilingual personnel in some departments would entail extra expense for the govern-
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ment. In my view, the appropriate word in this case is not "expense" but "investment". Action in this regard would contribute to national unity and to a deeper mutual understanding between both ethnic groups of this country.
Therefore, Mr. Chairman, I hope that this government will correct the weaknesses of the former administration and, in righting the wrongs committed, it will see, in all fairness, that the rights of both the main ethnic groups of this country are properly respected.
Those are, Mr. Chairman, the remarks I wanted to make.
(Text):


Mr. Badanai:: Mr. Chairman, the matter before us is not controversial and it is one with which everyone here will I am sure agree. I agree with what the hon. member for Ottawa West said this afternoon; he dealt with the subject more extensively than I propose to. We can also agree with a lot of what the hon. member for Carleton said, although he dealt with the subject in a rather general way without pinpointing any real important changes in the act.
I have no doubt whatever that some amendments to the Civil Service Act are due and perhaps the act should have been considered for revision long before this. What appears to me to be wrong in bringing this measure up for discussion at this late date is the time factor involved in order to give these proposed changes the consideration they properly deserve.
Here is an important piece of legislation brought in in a late rush hour fashion as though we were dealing with merchandise instead of the welfare of an important segment of every community in Canada, with the possible exception of the rural areas. Any contemplated changes to the act should have been made known to parliament at the beginning, not when the talk is that the end of the session is a few weeks away.
One of the changes needed to bring this act up to date is that of giving civil servants the right to bargain with their employer. The Prime Minister, speaking at the merger banquet of the civil service association of Canada, made a statement which should foreshadow the application of the principle of bargaining rights. Said the Prime Minister:
I believe that civil servants, through their organizations, should have a greater voice ... in the process of determining ... and participating more effectively in the application of certain principles of policy ... There should be a more systematic

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method of bringing your views and information to bear ... What is needed is more opportunity and better arrangements for your representatives to sit down at a table with officials representing the government and with officers of the civil service commission... You will have noticed I spoke of your representatives having a greater voice and participating more effectively in the application of certain principles of policy ... Your power will he the power of persuasion... Your success will depend, as it should, upon the merits of your arguments and the skill of your representatives in presenting them ...
Finally, perhaps the most important victory of them all so far, for you, was acceptance, free and full, by the government of the principle that it must lead the way in mutually rewarding, forward looking staff relations ... that is, people must be paid at least on a par with the best in competing fields of business and industry-
From this excerpt of the Prime Minister I wish to underline the passage where he said:
What is needed is more opportunity and better arrangements for your representatives to sit down at a table with officials representing the government and with officers of the civil service commission ...
If this sentence means what it is supposed to convey, then the Prime Minister is certainly committed to giving the civil service bargaining rights.
The issue is a simple one. It is whether or not a man or a woman working for the government should be deprived of those rights which are fundamental in our Canadian way of life. They want the right to sit at a bargaining table with their employers, the right to complain through newspapers or other media without fear of being dismissed, and the right to enter a committee room of a candidate for public office or to attend a political meeting without suffering the consequence of being cast in the ranks of the unemployed because of the whim of a member of parliament. Without these rights being clearly defined there would not be much use in rewriting the act.
Last November the hon. member for Winnipeg South, speaking at a meeting of Manitoba federal government workers, made the statement that he would give very serious consideration to the introduction of a bill in parliament to grant collective bargaining rights to civil servants. He later qualified the statement that he would bring the matter up in the caucus of the Conservative party and be guided by the general reaction of his colleagues. I think he was sincere, but evidently his colleagues were not impressed or he was prevented by the government from introducing a bill. If we are not going to make a better job the people will certainly feel that the government has let them down on a principle of which the Prime Minister has so often proclaimed himself its champion.
Arbitrary treatment of civil servants, however unintentional, should have no place in

any code of government conduct, and the civil service commission's annual recommendations should be tabled in parliament regardless of the nature of the recommendations.
In the matter of dealing with the question of salaries the Prime Minister made the following statement in May 1958:
For many years it has heen generally accepted that two main principles should guide the determination of salaries in the service.
Mr. Chairman, may I call it six o'clock.
At six o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 8 p.m.
Hubert Badanai: Mr. Chairman, at six o'clock I was reading a statement made by the Prime Minister in May of 1958. He said:
For many years it has been generally accepted that two main principles should guide the determination of salaries in the service. First, the salaries must be enough to do the job, that is to attract enough of the right kind of men and women into the service and keep them in it; second, they must be fair as between civil servants and people outside the service, the taxpayers if you will, which means that the salaries we pay for any class of work should be comparable with those paid by private employers for similar classes of work, taking into account the other terms of employment that are necessary to make a fair comparison. 1 think these principles should continue to guide us.
He then went on to say:
We are fortunate in having in the commission persons of outstanding ability and long standing records of outstanding work as career civil servants with a wide variety of experience.
These are statements with which we all agree but unfortunately these principles have not been made operative at any time since they were enunciated two years ago. Civil service employees give of their best to the government of the day no matter whether a Conservative or a Liberal administration is in power and indeed that is the way it should be because after all the government of the day is elected by the Canadian people, the actual employers of the civil servants. In other words, they do not serve a particular political party but simply perform their duties to the best of their ability by serving and advising those in authority above them what is best for the Canadian people.
It is in the light of these considerations that I believe the civil servants should be treated. The treatment accorded them should be on a par with the treatment accorded those employed in other fields of endeavour by private industry as has already been indicated by previous speakers participating

in the debate this afternoon. Without these principles fully spelled out any changes in the act will be relatively meaningless.
These men and women of the civil service fully realize their responsibilities as part of the government's administration. Let us treat them not as machines but as our worthy partners working together each in our own sphere for a better and more prosperous Canada.


Donald Methuen Fleming: Mr. Chairman,
there is one matter which was touched on this afternoon by the hon. member for Ottawa West upon which I should like to comment. It had to do with the procedure on the bill with respect to the present session.
What I said this afternoon was said by way of emphasizing the importance the government attaches to this measure and with it the importance that we feel should be attached to the study of this measure both by the house and by the proposed committee. Indeed, in closing my remarks this afternoon I said that the government recognizes the need for careful consideration of the bill by parliament and that to facilitate such detailed consideration I would propose that the bill following second reading be referred to a special select committee of the house for study and report. That is the purpose of the proposed committee, that the bill may be subjected to the most thorough study possible.
The hon. member for Ottawa West seemed to confuse this proposed detailed study with some suggestion of haste. There is nothing in my remarks this afternoon that bears that interpretation. My emphasis was on the necessity for the most careful consideration and study. I realize that that may take some time. That is something that will depend upon the length of time that the committee is prepared to devote day by day to this measure.
The hon. member asked me if in my opinion it was possible for the committee at the present session to give to this measure that detailed study. I expressed my own opinion on the subject and stated that that opinion based on a study of the act was that it could be done. No one knows the duration of this session, but the time required by this bill depends to some extent on the committee itself. I said, and I think rightly, that this is a matter for a decision of the house. I was giving an opinion on the point in reply to the question asked by the hon. member for Ottawa West.
Mention has been made of the fact that the various civil service associations will
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wish to be heard. I am quite sure they will. The cabinet committee that was engaged on this subject heard representatives of the associations, and I am quite sure they will wish to be heard before the committee.
What I should like to appeal for is that hon. members suspend their judgment in this respect until they have seen the bill. They will certainly then be in a much better position to decide whether this bill is going to occupy as much time as some hon. gentlemen seemed to indicate this afternoon they thought it would require.
That is what I am appealing for on this subject now, that when hon. members consider the resolution has been sufficiently debated in the committee they allow the bill to be introduced. It is ready now and could be distributed at once. After hon. gentlemen have had an ample opportunity to study the bill-and they certainly will have an ample opportunity to do so-that will be the time, I think, to decide whether in the light of such estimates as we can make of the probable duration of the session and the willingness of the committee to apply itself industriously to the task that is proposed for it, it is then in the view of the house a measure that can be proceeded with at this session with the hope of its being disposed of at this session having regard to all the tasks of the house.


John Whitney Pickersgill: Mr. Chairman, I think the minister on whom I do not often heap any compliments is to be commended for an attitude which, I may say, if he adopted it more frequently would undoubtedly facilitate the procedure of the House of Commons a great deal. The minister's suggestion is so reasonable that I do not think any hon. member of the committee could take any real exception to it.
If indeed the amendments that the minister is going to propose in the bill he is going to lay before us are so slight, so unimportant and so lacking in fundamental character that they would really represent no great change there probably will be no need for a lengthy and detailed examination-


Donald Methuen Fleming: I meant to suggest that it would so commend itself I am sure to the judgment of hon. members opposite.


John Whitney Pickersgill: As a matter of fact there are many hon. members on both sides of the house whose judgment is rather slow to be exercised, and it is part of the essence of parliamentary government, instead of making hasty, snap decisions such as the Minister of Finance is so capable of doing, many of us like to have a good deal of time for reflection, particularly when we are dealing with matters as important as this one.

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I think what the minister has said is a quite reasonable position to take, that we can look at this bill after it has been given first reading-and we shall have to look at it from several points of view, one of which I intend to say something about before I take my seat, -and when we have it, as the minister has assured us, we will have ample opportunity to consider it. Then I think there might be that consultation between my hon. friend from Laurier and the leader of the house, which from time to time does facilitate the proceedings, in the hope that we shall do what will be in the genuine interests of the public.
I agree entirely with the sentiments expressed this afternoon by the hon. member for Carleton at the opening of his speech. Nothing could have been more admirable than the general sentiment expressed by the hon. gentleman that we should approach this matter in a non-partisan sprit. But I do hope that the house and the committee from now on will follow those precepts and not the example of the hon. member for Carleton who, having enunciated those lofty principles, proceeded to give a very thorough demonstration of how widely one can deviate from principles and still appear to be following them.
The hon. gentleman, of course, in talking about the ancestry of this legislation had something to say which, if I were to make a very poor pun I would say was somewhat a foreshortening of history because, as the hon. member for Carleton must know, with the erudition we all know he is so celebrated for, it was Sir Wilfrid Laurier and Dr. Adam Shortt who were really responsible for laying the foundations of the Civil Service Act. Mr. A. K. MacLean, when he introduced the motion in 1918, had this to say at page 699 of Hansard of April 12, 1918:
A few moments ago I stated that I did not think the great advance proposed by the terms of the order in council in the civil service of this country could have been accomplished by the leader of the opposition,-
I have not done a great deal of research, and this is an inference. I take it this was an order in council that had been passed under the War Measures Act by the union government. He went on to say:
-if he were in power as leader of the Liberal party,-
That would be Sir Wilfrid Laurier.
*-nor by the present prime minister-
That is Sir Robert Borden.
-if he were in office as head of the Conservative party. I did not intend to detract-
I draw the hon. gentleman's attention particularly to this sentence:

I did not intend to detract in the slightest from the credit due to the ministry led by my right hon. friend-
That is Sir Wilfrid Laurier.
-the leader of the opposition for passing the Civil Service Act of 1908. On the contrary, X think that ministry is entitled to every possible credit for passing that act. It was a great reform.


Richard Albert Bell: Hear, hear.


John Whitney Pickersgill: It seems to me that, just to set the record straight that ought to be on the record. I do not intend to go on and labour the point.


Richard Albert Bell: Will the hon. gentleman permit a question?


John Whitney Pickersgill: Certainly.


Richard Albert Bell: Is the hon. gentleman familiar with the quotation from Mr. A. D. P. Heeney, his predecessor as clerk of the privy council, which says that the Civil Service Act of 1918 gave Canada the greatest measure of public service reform existing anywhere in the world?


John Whitney Pickersgill: Oh, quite. I am also very familiar with the fact that Mr. A. K. MacLean never called himself a Conservative and that it was Mr. A. K. MacLean who introduced this legislation as a member of the union government. This does bring me to another aspect of this matter, and that is the motion which was introduced by Mr. MacLean. I think perhaps it might be worth while to put the terms of that motion on the record because I want to say something about the point that came up earlier today, Mr. Chairman, when you were not in the chair. The motion read:
Resolved, that It is expedient to consolidate, revise and amend the Civil Service Act of Canada: and to provide that the salary of the chairman of the civil service commission shall be six thousand dollars per annum; and to make provision for the readjustment of grades and salaries in the various classes of the inside service, and for the preparation by the commission of schedules of the positions, duties and salaries of the outside service or of any portion or branch thereof; and to make appointments to the public service upon competitive examination and otherwise eliminate political patronage in the control and management of the said service.
I read that for this reason: That resolution bears a marked dissimilarity to the resolution which is now before the committee and I want particularly to draw your attention, sir, to the dissimilarity between that resolution and the resolution which is now before us.
Perhaps when I have the attention of the Chair I can continue with this point. The resolution in 1918 spelled out very specifically

the charges upon the crown which were involved in this matter. It is a marked contrast, therefore, with the resolution which is now before us which says:
Resolved, that it is expedient to introduce a measure respecting the civil service of Canada to amend, revise and consolidate the Civil Service Act, chapter 48 of the Revised Statutes of Canada, 1952.
During the course of this debate, I made * a very hasty examination of the act as it was recently consolidated and I could find nothing in the present act which appears to me to lay any charge upon the crown. Before the committee completes its consideration of this resolution the Minister of Finance should tell us what this resolution is really all about because the citation which was read this afternoon by the Leader of the Opposition, which I think ought to be put on the record again, namely citation 277 of Beau-chesne's Parliamentary Rules and Forms, fourth edition, is very clear. It reads:
A bill, which does not involve a direct expenditure but merely confers upon the government a power for the exercise of which public money will have to be voted by parliament, is not a money bill and no resolution is necessary as a condition precedent to its introduction.
It has always been clearly understood that in these resolutions there is no harm in putting in much surplus verbiage, but the one thing that must be in the resolution is a precise statement of the charge which the crown is asking to be imposed. No bill can be introduced imposing a charge unless the preceding resolution which has been accepted by the house states precisely what that charge is. There is absolutely nothing in this resolution which states what is the charge upon the crown.
It is true that at one time up until a very few years ago the salaries of the civil service commissioners were set out in the act but that is no longer the case. They are now fixed by the governor in council. I believe hon. gentlemen who are on the treasury benches took exception to that legislation at the time it was passed and it may be that the minister in his bill is considering going back to the situation that prevailed before that amendment was made. But I would point out that if that is what he is doing he should have spelled it out in his resolution and that the bill cannot be considered by the house if it contains such a provision unless there has been a message from the crown to that effect.
Unless the government is deliberately anxious to prolong the session, one wonders why this resolution is on the order paper at all and being debated if there is no charge, and if there is a charge being imposed by
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the legislation why the government has not spelled it out in the resolution. It seems to me that mystery should be cleared up by the minister before we complete consideration of this matter.
I should also like to refer to an editorial which I will not attempt to read because I know the minister can read and also because I am afraid I would be provoking the minister into rising on another of his frequent points of order if I did so. But before the minister rises perhaps I may go the length of commending to his attention an editorial in the Ottawa Journal of Monday, June 20 which says:	"Sane and balanced study of Civil
Service Act is essential". I think that is what is required if we are going to take our duties in the house seriously in a matter which is as serious as anything that is likely to come before us, as the hon. member for Carleton so justly indicated earlier today.
The government of this country under modern conditions cannot possibly function without an effective, reliable, honest and in the main I would go so far as to say a contented civil service. We cannot expect to have that unless we have the kind of legislation which gives to them a status, working conditions and a reasonable security which they have enjoyed in the past and to which I think every hon. member feels they are and should be entitled. I do not think it would be reasonable to consider that we should start on the 106th day of the session to attempt to pass at this session an act of parliament of the importance and of the volume of this legislation. There are things, of course, that are of the utmost importance but also of the utmost brevity but this matter is important without being brief and it cannot be made brief in any respect whatsoever.
Without prejudging the case, because I think we should all accept what the minister has said and look at the bill before we reach a final judgment on the matter, I would feel that the weight of evidence should lead us to reach the judgment that we should not proceed until everyone who is interested, including all civil service organizations and many other persons and organizations who have nothing to do with the civil service but are deeply concerned about good administration and good government of the country, has had adequate time to study the legislation and to make such representations as they may wish to make in order that when we revise and codify the act once again we will have the best possible legislation that we can, by the application of all our talents in a nonpartisan way, give to the Canadian people.


Mr. Herridge:: Mr. Chairman, I would not pretend to emulate the righteous indignation

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expressed by the hon. member for Hull or the rolling, rollicking eloquence of the hon. member for Carleton, but I do want to take advantage of the latitude allowed at the resolution stage to deal particularly with one point that I wish to bring to the attention of the minister and the Prime Minister. Before doing so, may I say that we wholeheartedly concur in the criticism of the hon. member for Bonavista-Twillingate on two particular points. First of all, this is most important legislation that concerns the people of Canada, the government of Canada and the civil service of Canada upon which efficient government has to depend. We think it is most unfortunate that this important and lengthy legislation has been introduced in the house at this late date in the session. I do not see how it can be properly dealt with unless the house is willing to sit until toward the end of August.
Second, we agree with his criticism-I had already looked up the same reference that the hon. member for Bonavista-Twillingate mentioned-that the resolution is very barren indeed of information and of details concerning what the proposed act is going to include. However, we will have to leave our discussion of the details until we see the bill.
Others in this group and other hon. members of the house have dealt with the questions of collective bargaining rights for civil servants, terms of employment, classifications, salaries and so on. However, I want to take this opportunity to deal with a particular problem that I think is of interest to people who are first of all interested in an efficient civil service and also in the rights of the civil servants. When one reads the history of developments in Great Britain, France and other European countries he sees that there is a changing climate and a changing opinion in that direction. In speaking of the civil service this evening there may be a tendency to assume that such organizations are of long duration and have a considerable history. As a matter of fact, in terms of history a civil service is a very recent innovation on the part of parliaments and governments.
I checked up quite hurriedly in the library and found that the first indication of concern for a civil service by the British government was around 1848 to 1850. It is interesting to note that a civil service in all countries began to develop with the advance of industrialism and, shall I say, the fading away of feudalism or the remnants of feudalism because an industrial society requires first of all a better functioning government and therefore a more efficient and better functioning civil service.

Of course, under feudalism and the remnants of feudalism most government appointments were the result of nepotism and, as one might say, by grace.
I found that the first study was around 1848 to 1850. Then there was the Trevelyan Northcote report of 1853 which dealt extensively with the question of establishing a civil service in Great Britain. It was on the basis of that report that in 1870 Gladstone, by order in council, introduced the first civil service legislation in Great Britain. Since that time, of course, there has been tremendous development in the civil service of that country. As a matter of fact, it is so efficient that it has been a model for all other countries.
Coming to Canada I find on checking the records that the first civil service act of a rather primitive nature was passed in 1882. Then there were amendments in 1883, 1884 and 1885 which, according to my rather quick checking of the records, concerned largely what was then known as the inside civil service. You might say it was the birth of the civil service in Canada. But the great step forward was in April of 1918. Without doubt, for the first time in Canadian history the civil service was put on a sound foundation so far as legislation was concerned.
It interested me, in just checking the history of the past, to notice the recurrence of human weakness. I do not blame any party. This conception of to the victor belongs the spoils is a very human one. I can well understand that when a party has been out of power for 22 years it must have a considerable percentage of supporters who think it is their turn. Life is a rather short affair, and when you have not had a dip into the basket in 22 years you get a bit hungry. I am quite sure this government has had to resist a great deal in that respect because this is a very human weakness. The more civilized people become, the more they recognize what democracy really means, the more they are able to resist.
I was very interested in noting that in the debates of 1918, shortly after the union government was elected, there were still members of the Conservative party who, according to their correspondence, supported the idea of patronage. I should like to quote from Hansard for April 12, 1918, page 711, on which page a letter is to be found which reads as follows:
Dear Sir.
Yours of the 9th instant duly received. As far as any patronage in connection with the railway department is concerned, there is not the slightest doubt hut that both Liberals and Conservatives who supported the Union government will receive every consideration.

In fairness I must say that at the same time and in the same debate there is evidence that members of the same party had taken the very opposite point of view. I mention that to indicate that this is a human weakness which is found in all parties and because it is human, it is natural, we have to resist it.
When I was reading that I was reminded of a story. My father, who was president of the Liberal association of that day in the riding from which I come, actually supported the Union government. This was the only time he ever supported a hybrid thing in his life, and he did so on account of the war effort. I remember running through some correspondence in 1917 when this Conservative government was proposing these amendments to this Civil Service Act, and there was still this spirit of patronage. There was a Conservative association in our riding. This shows how a division can occur even within a party.
The president of the association was a strong patronage man and the secretary treasurer was an anti-patronage man. The secretary was pressing the association to support what the government intended to do, and so there was a clash. The president wrote to the minister of the day who was directly connected with British Columbia and told him about the difficulty he was having with the secretary. In fact, the president mentioned that the secretary thought he was living in England where you could run a government without patronage. The complaint was very bitter. The person to whom he was writing was not in sympathy with his ideas. This is what he wrote back. He said, My dear Mr. So-and-So: I fully appreciate your criticism of Mr. So-and-So, the secretary, but we are going to have an election within a few months and we do not want any trouble in the party.
To give you an idea that this man was very much against the whole idea, I may say he simply wrote, so far as I am concerned, we do not want any trouble within the party, so my advice to you is to continue to scratch his back until the election is over and then after that you have my permission to tell him to go to hell. This patronage condition within parties is something about which we all have to be watchful, no matter to what party you belong.
I want to deal now particularly with a point I raised, and bring it to the attention of the Prime Minister and the Minister of Finance. I refer to the question of the rights of civil servants, that is to have the full rights of citizenship. As I said before, this concerns thinking people. It has been mentioned before today. It is a matter of concern to
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those who desire the maintenance of an efficient civil service and who, at the same time, want to see those civil servants given their full rights as citizens of the country. I want to bring to the Prime Minister's attention a book written by H. J. Laski entitled, "Reflections on the Constitution, the House of Commons, the Cabinet, the Civil Service", published by the Manchester University press. We all know Mr. Harold Laski as a Labour member of parliament and a very brilliant person.


Paul Joseph James Martin: He was never a member of parliament.


Herbert Wilfred Herridge: Excuse me, a lecturer at the London school of economics and chairman of the Labour party. I do not know why I made that slip. His writings are even read by Conservatives in England because he had a brilliant mind and was an authority on the constitution and parliamentary practices. I want to read a few paragraphs from this book because I believe that every thinking person who has given any thought to this problem- it is not an easy problem-will recognize that he does bring forward some very valid ideas. I think this is something to which consideration should be given. This chapter is headed, "The political rights and social interests of civil servants", and he says:
I turn to a very different issue-now a matter of acute controversy-on which I think far more clear and frank thought is necessary than it has thus far received-I mean the degree to which we ought to place restrictions on the political rights of civil servants.
Then farther down he says:
Above all, I believe it is a great mistake to separate the vast majority of officials from work in local government where, very often, their experience of administration would enable them to make an important contribution to the standards of administration. I do not believe that the public would lose confidence in the detachment and loyalty of civil servants if, under agreed conventions, they were given the chance of exercising the rights of a citizen.
Then he goes on to say:
In the French system, a great many civil servants, of whom, perhaps the best known among those living is that eminent humanist, Mr. Leon Blum, have played their part in politics without any deterioration in their work; and I have known scores of lesser cases in which the official's political affiliation was both active and known without producing the conviction that he would not be loyal to a minister whose convictions were of a different school.
I realize that when you get that type of relationship you have to have very high principles and devoted persons on both sides of the question.
Let me begin by saying that officials do not need a special party connection in order to make their views obvious.

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Then he goes on at some length and says: .Perhaps I may summarize this by saying that when an official had strong political opinions, he could not conceal them from any but the most stupid of ministers for more than the first hour of their relationship; and the real question was, and is, granted those convictions, was he capable of looking at the minister's views with detachment, and of helping him to apply them with the full energy of his mind. The answer is, sometimes yes, and sometimes no. Sir Austen Chamberlain, in his autobiography, tells an admirable story of the permanent secretary of the post office when he was postmaster general.
I am sorry to see that the Postmaster General has just gone out, but I am sure his parliamentary secretary will listen to this.
They quarrelled violently over a decision Sir Austen proposed to make until at last he told his official that he had made up his mind that the decision stood. Thereupon, Sir Austen tells us, his permanent secretary said, "Well, Postmoster General, if you want to make a damn fool of yourself, I cannot prevent you from doing so. But at least I can show you how to do it with the least possible damage to the country."
Now there was a first class civil servant. I hope the minister's civil servants take the same attitude when required.
That is what I mean by loyalty and detachment, and I think they are qualities quite distinct from political convictions and party preference.
Farther down, he says:
First, it is clear that all members of the administrative class should impose upon themselves a self-denying ordinance in the political sphere.
I agree with that.
They ought to resign if they want to be candidates for parliament. They ought not to make political speeches. They ought not to write books or articles on the immediate issues of political controversy. They are too near the centre of power to do any of these things.
Then he goes on to say:
But below the administrative class, 1 do not think that rule should apply. It is enough if an official in the executive, or clerical class, give an undertaking, whether he becomes a parliamentary candidate or takes an active interest in his party, not to discuss in public the affairs of the department to which he belongs, nor to reveal information which he obtains by virtue of his position in the service; if he were to break his undertaking the permanent secretary would be justified in recommending disciplinary action, though I should hope that, before the permanent secretary made his proposal to the minister, he would discuss it with the departmental Whitley council and proceed, if possible, with its approval. I should give officials who became parliamentary candidates leave, with pay, for the period of their election. If they were defeated, they would return to the department in the ordinary way. If they were elected, I should put them on a special list the officials on which would be free to return to the department if they were defeated in the next election in their old grade, and with any increments of pay which had normally accrued to them; if. however, they were returned for a second parliament, I should assume that this operated as a normal resignation from the service, though I should hope that they would receive a due proportion of the pension rights they would

have received on retirement. I frankly see no difficulty in this. I do not really think such a candidature would embarrass the department. And if it is a question of practical activity other than that of a candidate, I feel pretty certain that no Manchester constituency would be seriously concerned about the fairness of civil servants if, let us say, a woman shorthand typist in the area office of the ministry of health made a swinging attack in the exchange division at a Tory meeting on the folly of Mr. Strachey's ground-nuts scheme, or a clerical officer in the office of the local inspector of taxes spoke with some heat about the refusal of the Home Secretary to ban the Fascist party. Assuming that the average civil servant observes the normal decencies of political behaviour, I am unable to believe that the liberation of the grades below the administrative would shock any public opinion or do any harm to the work of these departments.
He goes on at some considerable length, and then towards the end of his remarks he has this to say:
There are two related questions upon which I should like to say a word. I hope we shall rapidly end the system which prohibits the civil servant from writing upon politics and public administration save by the permission of the department. Here again my view is that there should be the right to freedom limited only by some obvious conventions which could easily be agreed through discussions in the Whitley organisation at national and departmental levels. I do not think that an official of the Foreign Office should attack his minister-
And so on. Anyway, he goes on to deal with the argument that, under proper central arrangements and under proper legislation, with a civil service of high standard it should be possible for civil servants below the administrative class to be allowed leave to take an active part in politics without losing their rights in the civil service until after, say, the second election.
I have mentioned these few quotations. I bring this book to the attention of the Prime Minister and the minister because he has given great thought to this matter. There has been discussion in the House of Commons in Great Britain. It has been given serious consideration and considerable attention. Mind you, as I have mentioned previously, the standards with respect to the treatment by ministers of the senior officials is very high indeed and is a model to the world. But in fairness to the civil service I think we should give some consideration to this question. To that end I urge the government of the day to consider this important question.
I frankly admit it is not a simple or an easy one. However, it is important to the people of Canada as a whole who are interested in an efficiently functioning civil service. It is important to the government that needs the continuing support of a first class civil service. It is also extremely important to the civil servants of Canada who are citizens of this country.

I trust the government and the committee will also give consideration to the other suggestions brought to the attention of the committee by various hon. members who have spoken in this debate this afternoon.


Jacques Flynn: Shall the resolution carry?


John Whitney Pickersgill: Before the resolution carries, perhaps the minister would say a word about the point I raised in connection with the resolution.


Donald Methuen Fleming: I think the desire of all hon. members is to see this bill as soon as possible. The hon. member is raising something that he sought to raise on a point of order this afternoon. Frankly, there is no proper foundation. Hon. members know these resolutions are drafted by the most skilled and experienced person in Canada on these matters, namely the law officer of the House of Commons.


William Moore Benidickson: In tonight's edition of the Ottawa Citizen we have all read an article that, I am sure, interests us all. It says that the Prime Minister has replied to certain communications from the postal employees and it says that the letter is in answer to one sent to the Prime Minister on June 11 by the Canadian postal employees association. It indicates that this association had not much prior to this time sent representations to the civil service commission or to the Prime Minister. This is contrary to the type of representations that we have received during the last six months. I wonder whether the Prime Minister or the Minister of Finance would indicate whether or not they have steadily received representations from the Canadian postal employees association for increases in salary and why the civil service commission has not, as the Prime Minister has indicated in his reply, reported up to date on this matter. It was my understanding that the Minister of Finance had referred to this trade category as one that desired a very early consideration.


Jacques Flynn: Shall the resolution carry?


Some hon. Members:: Carried.
Resolution reported and concurred in.
Mr. Fleming (Eglinlon) thereupon moved for leave to introduce Bill No. C-77, respecting the civil service of Canada.


John Whitney Pickersgill: I am rising on a point of order, Mr. Speaker. As Your Honour will observe, the resolution on which the bill is to be founded, contains only the barest citation of the fact that the bill proposes to consolidate or revise the Civil Service Act. As Your Honour well knows, the purpose of a resolution preceding a bill is to indicate
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clearly to the house the charge laid upon the exchequer by a money bill. As Your Honour is well aware, citation 277 of Beauchesne's fourth edition reads as follows:
277. (2) A bill, which does not involve a direct expenditure but merely confers upon the government a power for the exercise of which public money will have to be voted by parliament, is not a money bill and no resolution is necessary as a condition precedent to its introduction.
(3) A bill designed to furnish machinery for the expenditure of a certain sum of public money to be voted subsequently by parliament may be introduced in the house without the recommendation of the crown and without a resolution being first considered in committee.


Mr. Speaker:: What is the number of the citation?


John Whitney Pickersgill: It is citation 277, to be found at page 226. It seems to me-and I do not intend to labour this point at all-in view of the fact that the resolution gives no indication of any kind as to what is the charge that is being laid on the exchequer by the proposed bill that before we consent to the introduction of the bill, the bill should be examined to see whether or not it imposes a charge or seeks to impose a charge about which the house has not been apprised by a message from the crown.


Donald Methuen Fleming: Mr. Speaker, the hon. member is raising a point of order. In my submission to you this point of order is raised much too late. This afternoon the house by decision resolved itself into committee on this self-same resolution. That was a decision of the house. If any hon. member considered at that time that there was anything lacking in the resolution, that was the time to raise it. No such point was raised at the time. Hon. members are aware that such a motion is not debatable but it can be voted on; and if there is anything out of order about it a point can be taken, but it must be taken at the proper time. It is much too late now to be raising a point of this kind after the house has already resolved itself into committee on the resolution and the resolution has been reported back in pursuance of the instructions of the house. So I say in the first place that this point is raised much too late.
In the second place the hon. member is questioning whether this resolution is sufficient. He sought to raise the point this afternoon that the resolution did not go far enough, that it should have spelled out some provisions of the intended bill, or their effect, in greater detail. I do not think he can have it both ways.
It has been ruled, and I think it must be a matter of common knowledge in the house now, that the reason we have these resolutions involving charges or expenditure of

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money is that the house shall have notice of the purpose of the measure. There have been statements and rulings to that effect. It is not necessary that the proposed charge be spelled out in specific terms. The hon. member before the committee rose sought to go back and raise these subjects again, or at least discuss them, although the point had been disposed of this afternoon.
I say in the first place, Mr. Speaker, that hon. members are aware that these resolutions preceding so-called money bills are drawn by the most experienced authority on this subject in Canada; they are drawn by the law officer of the House of Commons. When the law officer of the House of Commons draws a resolution I think hon. members are entitled to prefer his opinion as to the necessity of such a resolution and as to the sufficiency of the resolution which he draws over the opinion of the hon. member for Bonavista-Twillingate (Mr. Pickersgill). However, I suppose there is no harm in his trying.
The fact is, Mr. Speaker, that the house has had resolutions in comparable form on previous occasions and they have been ruled to be quite sufficient. There is a decision made in this house, for example, on March 24, 1882. On that occasion Mr. McLelan-


Lionel Chevrier: It is out of date.


Donald Methuen Fleming: No, it is not out
of date; it is the hon. member opposite who is out of date if he has not been following this. Mr. Speaker, so that you will realize that the matter was discussed fully from all of the angles, I would like to read the content of Hansard, commencing at page 546 for March 24, 1882, in relation to the argument that was then put forward. I quote:


Mr. McLelan moved: that the house resolve itself into committee of the whole to consider the following resolution:-
"That it is expedient further to amend and consolidate as amended, the Act 31 Victoria, Chapter 65, and the acts amending it, respecting the inspection of steamboats, and for the greater safety of passengers by them."


Sir Albert J. Smith:: The resolution does not indicate at all the change which the hon. gentleman contemplates. It is defective in that respect and I think he ought to explain it.
Does this not remind you of the words of the hon. member for Bonavista-Twillingate? I continue:


Alexander Neil McLean: The object of the bill is to consolidate the various amendments made by the Inspection Act, and to provide more fully for the inspection of the hulls of ships. The inspectors of steamboats are men mainly qualified to inspect boilers and machinery. It is proposed to appoint men specially qualified to inspect the hulls of vessels, and the certificates of both classes of inspectors will be necessary for a ship to be pronounced seaworthy. Regulations are also made

to fix the number of passengers which each boat shall be allowed to carry. These are the two main features of the bill.
Then Mr. Mackenzie, the former prime minister, went on to say:
The rules require that, on any bill relating to trade or to alter the laws concerning trade, being brought into the house, the proposition must first be submitted in committee of the whole. This is a simple notice of the minister's intention to bring in some amendments, and I object to it as being entirely out of order.


Alexander Neil McLean: The only change proposed to be made is to consolidate the law, and to define clearly the mode of appointment and qualifications of the inspectors.
Mr. Blake.
And here is the great constitutional authority speaking.
Of course it is more than a consolidation, because the resolution tells us that "it is expedient further to amend and consolidate as amended," the various acts. The objection of the hon. member for Lamb-ton is that the whole purpose of the rule, which is to give the house an opportunity to make any suggestions they wish, is entirely thwarted, unless in some sort the substance, the essence, of the proposed legislation is stated in the resolution upon which the house goes into committee. That is the difficulty-how are we to know that it is expedient to alter anything unless we know what the alteration is?


Sir John A. Macdonald:: The house can pass a resolution, no matter how vague in its terms, declaring that it is expedient to amend the act. The house can ask for a most specific statement unless it is fully satisfied with that made.
Mr. Mackenzie. I do not think it is open to the house to adopt that course. It laid down very clearly that no bill is to be brought in until the proposition has been first considered in committee of the whole. I ask the right hon. gentleman if he will state from the paper what the statement is.
Sir John A. Macdonald. That it is expedient to amend and consolidate the acts. A clearer or more specific statement could not be made.
Mr. Blake. What is to be considered is the proposition contained in the bill. It is not sufficient that the act shall be amended, but it shall be amended in some particular way, and it is that proposition that shall be submitted to the committee.
Mr. Speaker decided that the rule, as generally understood and interpreted by late English practice, simply required the house to go into committee to consider a general proposition setting forth the expediency of bringing in a measure on a particular question; and that consequently in his opinion the proposed motion came sufficiently within the meaning of the rule.
Motion agreed to; and house resolved itself into committee.
Mr. Speaker, you will observe there that the objection was taken before the house resolved itself into committee on the resolution and the Speaker, having heard a very full argument from some of the leading figures in Canadian parliamentary history, ruled that the resolution had given sufficient notice and was sufficient in its terms and that the resolution was in order.
The hon. member for Laurier (Mr. Chevrier) undertook to suggest, that this was out of

date. Well, May 11, 1925 is a more recent date and here I refer you, Mr. Speaker, to Hansard where there was a discussion on a similar point. As reported on page 3038 of Hansard a point was raised that the resolution did not give sufficient particularity to indicate what were the specific charges that the measure was to lay upon the crown. The significant thing here, as you will see on reference to page 3038, is that the chairman in making his ruling reviewed this very decision and quoted the argument I have just read from Hansard of 1882.


Paul Joseph James Martin: Would the hon. minister tell us what was the resolution in 1925?


Donald Methuen Fleming: The resolution was as follows:
Resolved, that it is expedient to amend and consolidate the Canada Grain Act, chapter 27 of the statutes of 1912, and amending acts, and to make further provisions in respect to the handling and marketing of grain, or incident to the buying, selling and transportation of grain; the grading and weighing of grain; the handling of grain in and out by country elevators and at country points and inspection of such elevators; the operation, management and control of terminal, public and private elevators; the storing, cleaning and binning of grain; the mixing of grain and the [DOT]disposition of screenings.
The very same point was raised and Mr. Lapointe, and I trust the hon. member for Essex East (Mr. Martin) is not going to challenge the authority of Mr. Lapointe-


Paul Joseph James Martin: No, but I will challenge your interpretation of it.


Donald Methuen Fleming: After the chairman had quoted at great length from the Hansard of 1882 and had said that he ruled the motion in order having regard to the decision of the speaker in 1882, Mr. Lapointe said further, as reported at page 3038 of Hansard of May 11, 1925:
In support of your ruling, Mr. Chairman, may I quote a precedent? On the 11th March, 1914, a resolution was moved reading as follows:
Resolved, that it is expedient to consolidate and amend the Canada Shipping Act and the acts in amendment thereof and various laws relating to merchant shipping.
That was under the government of which my right hon. friend was a specially distinguished member.
That one was ruled to be in order. I hope the hon. member for Essex East has not reached the point now of challenging the things said in this house by the late Right Hon. William Lyon Mackenzie King.


Paul Joseph James Martin: I am challenging the Minister of Finance.


Donald Methuen Fleming: Here is what William Lyon Mackenzie King had to say in this house on March 24, 1936, as found at page
Civil Service Act
1385 of Hansard of that year, during the course of a similar discussion:
The resolution is essential as a preliminary notice to the house that public expenditure is involved; it so to speak, gives double notice of what is of significance in that respect. The rules of the house never contemplated that, on the resolution preceding a bill, all particulars of the bill itself should be discussed or should be the subject matter of a general debate. The present administration feels that it will not only facilitate the business of the House of Commons but will effect a greater dispatch of public business if when presenting resolutions the explanation is limited to essentials.
This afternoon I made a statement reviewing the background of the present measure and outlining the leading features of the measure according to the practice of the house. The resolution reads as follows:
Resolved, that it is expedient to introduce a measure respecting the civil service of Canada to amend, revise and consolidate the Civil Service Act. chapter 48 of the Revised Statutes of Canada. 1952.
The house was put on ample notice of the proposed measure related to the civil service of Canada and that it was a measure to amend, revise and consolidate the Civil Service Act. All hon. members of the house have access to that act and can see the detailed provisions that it contains and realize that there are some of them which have the effect of creating certain charges on the crown. This resolution gives the house notice that the bill to follow this resolution is one to amend, revise and consolidate that act.
I dealt with the various aspects of this resolution and have made the house well acquainted, I think, with the leading features of the bill as far as it is proper to deal with those on the resolution stage and the house is aware of those in which any question of charge on the crown is affected.
This is my concluding observation, Mr. Speaker. In a situation like this if there is any doubt in the mind of the government as to whether a charge is or is not involved then we in obedience to the authority of the House of Commons are bound to err if at all on the side of bringing in a resolution so that there may be no question whatsoever of abridging the rights of the house or its opportunity to have full and ample discussion.


Lionel Chevrier: Mr. Speaker, we have had a long dissertation from the Minister of Finance (Mr. Fleming)-


Mr. Monteiih (Perth):: Very informative.


Lionel Chevrier: -on the procedure and on the motion which was raised in the course of the debate this afternoon. Perhaps Your Honour would allow me to say that at one stage after the minister had outlined the resolution and made it quite clear that there

Civil Service Act
was no question of expenditure in this resolution the hon. member for Hull (Mr. Caron) proceeded to discuss the question of pay and other allowances affecting the civil service of Canada and was immediately stopped by the chairman of the committee.
It was then in answer to two questions put by myself that the Minister of Finance (Mr. Fleming) made it quite clear that this measure did not involve the expenditure of any money. For the first time, then, at that stage of the resolution we were told that this matter did not involve the expenditure of any money although during the course of the explanation he made of the resolution the Minister of Finance indicated that there would be certainly a discussion of the right to pay and salaries. Knowing for the first time then that it did involve the expenditure of money we raised the point. I moved a motion that the committee rise, report progress and ask leave to sit again later this day but that was voted down. This was the only opportunity with Your Honour in the chair when it was possible for the hon. member for Bonavista-Twillingate (Mr. Pickersgill) to raise the matter again. I believe the minister this evening has repeated exactly what he said this afternoon. If it is true as the minister has said to me that there is no expenditure involved in this resolution-


Donald Methuen Fleming: I never said any such thing, Mr. Speaker.


Paul Joseph James Martin: Yes, you did.


An hon. Member:: He never did.


Donald Methuen Fleming: I never made any such statement.


Lionel Chevrier: I do not know who said, "He never did," but I have read my Hansard and I know what the minister said. I put two questions to him. One of the answers I received was that there was no expenditure involved in this measure.


Donald Methuen Fleming: Mr. Speaker, that is not complete or correct in any way.


Paul Joseph James Martin: That is a complete and correct statement of what the minister said.


Donald Methuen Fleming: I said no such thing.


Lionel Chevrier: If that is so there should be no resolution at all and we should be dealing with second reading of the bill. I repeat, if I may, subparagraph 2 of citation No. 277 of Beauchesne which is up to date and does not deal with a matter that transpired in 1882. The citation reads as follows:
277. (2) A bill, which does not involve a direct expenditure but merely confers upon the government a power for the exercise of which public

money will have to be voted by parliament, is not a money bill and no resolution is necessary as a condition precedent to its introduction.
With Your Honour in the chair I submit with deference we have the right at this stage to present the point as the hon. member for Bonavista-Twillingate has done.


John Whitney Pickersgill: Mr. Speaker, I wonder if you would permit a very brief argument on one point raised-


Mr. Speaker:: I will permit the argument. Perhaps I had better hear the hon. member before commenting.


John Whitney Pickersgill: Mr. Speaker, if as the Minister of Finance (Mr. Fleming) said to the hon. member for Laurier (Mr. Chevrier) this afternoon no expenditure is involved I believe there is then no point of order. I do not question the right of the government to introduce an unnecessary resolution at all. I think it is silly but I do not question the government's right to do so. If, on the other hand, as the minister now seems to contend this evening there is a charge imposed by this bill then I say that the resolution was insufficient because the resolution does not tell us what is the charge.
As I say, if there is no charge I do not think there is any merit in my point of order because while I think it is silly to have introduced the resolution the government has a right to do so; but if there is a charge we have a right to know what it is.


Richard Albert Bell: Just plain pettifoggery.


Mr. Speaker:: May I review the procedure which brings us up to the point of order raised by the hon. member for Bonavista-Twillingate (Mr. Pickersgill). Earlier in the day the house accepted a motion to resolve itself into committee of the whole to consider the resolution in question:
Resolved, that it is expedient to introduce a measure respecting the civil service of Canada to amend, revise and consolidate the Civil Service Act, chapter 48 of the Revised Statutes of Canada, 1952.
That resolution was then considered by the committee of the whole and it has been reported to the house. The report, by vote of the house, has now been received. Then the motion that the resolution be concurred in was accepted. What followed was a motion by the Minister of Finance (Mr. Fleming) for leave to present a bill based on the said resolution. At that point the resolution has been accepted by the house in committee and reported. It has been adopted and the matter before the house is whether the minister shall have leave to introduce a bill based on the said resolution.

As I understood the argument of the hon. member for Bonavista-Twillingate the bill should be looked at before the house gives leave to its introduction. I personally do not see how that could be done. The house does not accept the bill by allowing it to be introduced. If any exception is to be taken to the contents of the bill as not being in accordance with the resolution, then it seems to me that exception must be taken after the bill has been introduced and when it is under consideration. Therefore, I fail to see how the point of order is properly taken at this time. It seems to me that the motion must be accepted or rejected.
When the bill is introduced, if it appears that the other matters which have been debated are relevant and there has been an insufficiency of resolution to support the bill, that point may be taken, of course, on any particular section of the bill which seems to go beyond the resolution improperly and it could be objected to on that ground.
The other point that was made that if this is not a money bill no resolution was needed may be so, but I do not know of any authority to say that if it is not a money bill the fact that there has been a resolution is irregular. It is unnecessary perhaps, but there is no irregularity. I am afraid I cannot give effect to the point of order which was raised, certainly at this time, and I must proceed with the motion which is before the house.
The Minister of Finance, seconded by the Minister of National Health and Welfare (Mr. Monteith) has moved for leave to present a bill based on the said resolution. Is it the pleasure of the house to adopt the motion?
Motion agreed to and bill read the first time.



INCOME TAX ACT

Donald Methuen Fleming: the second reading of Bill No. C-68, to amend the Income Tax Act.


William Moore Benidickson: Mr. Speaker, I think the Minister of Finance (Mr. Fleming) has rather condemned this bill for perhaps inadequate discussion when on budget night, March 31, in his remarks he indicated that we were more or less, in so far as tax matters were concerned, in a considerable state of status quo, unusually so, sir, I say. The Minister of Finance, as reported at page 2685 of Hansard of March 31, 1960, to indicate this element of status quo, had this to say after a long speech, which the minister is always noted for. He said:
The net effect of all the amendments I am proposing to our taxing statutes will be to make no measurable change ... for 1960-61.
Income Tax Act


Donald Methuen Fleming: On a point of order, if the hon. member is going to quote me I suggest he quote me correctly. He just omitted about seven words. I said:
-to make no measurable change in the estimate of total revenues for 1960-61, which I presented to the house earlier this evening.


William Moore Benidickson: I will accept that and I will go on, Mr. Speaker. I was just saving time because the minister is so keen always to get up and say that we should save time here, and that was my intent.


Lionel Chevrier: He takes much more time than anyone else.


William Moore Benidickson: He takes much more time, as the hon. member for Laurier said, in introducing petty points of order that delay procedure, than anyone else in the house, which is contrary to the procedure which he followed when he was on this side of the house. However, I go on with the quotation:
The amount of tax relief-
This will be interesting to all hon. members.
The amount of tax relief accorded by some amendments will be approximately balanced by the increased revenues from others. The total loss of revenue from the relieving amendments could add up to as much as-
What, is anybody's guess. I quote from the Minister of Finance:
-$2 million-
This is how important the budget propositions of the Minister of Finance were this year. Then, he went on to say:
-and the increased revenues from blocked loopholes and clarified definitions are likely to be of about the same amount.
In other words, he was presenting a balance in so far as legislative changes were concerned which would come before this committee and this legislature. Yet, that, of course, is not entirely the picture. He was very quiet this year, but he took an awful bite last year. Last year he increased the taxes on the Canadian people, as estimated by himself, and that should be a favourable estimate, to the extent of $352 million. If we have a quiet time this year, it means that the same people are going to pay the same $352 million this year. This, of course, compares-
Mr. Pallet!: What about before June 10, 1957?


William Moore Benidickson: The hon. member for Peel (Mr. Pallett) refers to the promises that were given. Actually, I was not proposing to refer to those but I have some notes on them. I think the whip of the Conservative party will regret this.

Income Tax Act


Paul Joseph James Martin: He always interrupts, anyway.


William Moore Benidickson: He has interrupted. Because of that I think I have the right to suggest to you, Mr. Speaker, that this present government when asking for power suggested that when a bill would come before us- and this is not the first time, not the second time, but the third time-at some time we would get some of the promised things in an income tax bill. The Prime Minister (Mr. Diefenbaker) was responsible for and was leading the party when he appealed, as the hon. member for Peel says, in the election of 1957, for votes. He got a lot of votes by saying that tax changes to put Canadian companies on a basis of equality with foreign corporations or their subsidiaries operating in Canada should become part of our tax laws. Do we find that in the bill before us today? No.
The member for Peel has prompted me to say also that the same individual, now our Prime Minister, in his opening campaign speech in Massey hall, Toronto, in April, 1957, said that less discriminatory methods of taxing Canadian oil companies should be introduced into our income tax laws.
There was a suggestion that there should be a change in the income tax law to encourage Canadians to acquire a greater equity in Canadian enterprises, but we find nothing of that kind in the bill before us. I have referred several times this session to the possibility that the committee on mines, forests and waters should do something about the well known desire of its chairman to have Canadian research specially recognized for exemption so far as income taxation is concerned. Let me tell the whip of the Conservative party very frankly that I had this here but I had not intended to rub his nose into it particularly.
I intended to say that the effects of this legislation on the balance of ways and means were so slender this year that we were just having a repetition of another impost, a new impost of $350 million the same as imposed in the budget of 1959. I was prepared to say that before taking my seat and examining the particular clauses of the bill before us.


Mr. Palleii:: The hon. member does not question that taxes are still lower than they were before June 10, 1957?


William Moore Benidickson: The hon. member has again stuck out his nose. I have certain figures here which 1 had not intended to use.


Paul Joseph James Martin: The whip had better stay quiet. He is only embarrassing the Minister of Finance (Mr. Fleming).
tMr. Benidickson.]


William Moore Benidickson: He is embarrassing the Minister of Finance considerably because having regard to the constituents in his riding I think he would be one of the first to recognize that the latest available statistics we as members of parliament have-


Mr. Slarr:: Whose statistics?


William Moore Benidickson: -are found in the report of the Department of National Revenue, taxation division, for 1959. This report analyses in great detail the various categories of people paying taxes, and I am referring to those in the low tax-paying bracket. According to this green book of the Department of National Revenue, may I tell the hon. member for Peel that the total number of people in this country paying income tax is 4,076,465. I want him to go to his constituents and compare the present tax rates, including the new impost for old age security, with those that prevailed before this government came into office. I want him to relate that to the fact that in the $4,000 to $5,000 income group there are 573,000 taxpayers and in the $3,000 to $4,000 income group there are approximately 1,015,000 taxpayers. I calculate that the latter group represent about 25 per cent of the total number of taxpayers in the country.
If the hon. member for Peel will look at the statistics and take account of the increase in the old age security tax compared with the 1957 old age security tax and the ordinary tax on income, he will find he was very inopportune in introducing that subject at this time.


John Cameron Pallett: You had better check Hansard.


Michael Starr: You had better go back and tell that to your own people.


William Moore Benidickson: The labourers of this country who contribute their share to the unemployment insurance fund had a new tax bite of $75 million imposed on them last year by this new government. I think the whip of the Conservative party is perhaps not too thoughtful when he makes interjections of this kind because I was very considerate of the Minister of Finance at the resolution stage prior to the introduction of the bill to amend the Income Tax Act. I said to him then-


Donald Methuen Fleming: Page?


William Moore Benidickson: -that I thought he had introduced a procedure that I should commend. He introduced his proposed budget changes on March 31 and on May 6 he saw fit to inform the public and ourselves that he had had some second thoughts. I said that his predecessors had had second thoughts after introducing budget proposals but that

the minister had decided to put his amendments in the form of an appendix to Votes and Proceedings. The minister rather glowed when I said that this was a novel and nice thing to do but I am afraid the Minister of Finance has reverted to his shell that is so typical of him and is again giving notice at the last possible minute. He took the last available opportunity to inform us of the amendments that he is going to propose to the legislation tonight. On Friday night he gave notice of certain changes affecting the bill now before us.
If there is any substance to the amendments that the minister is proposing why did he delay giving notice of them from March 31? He forgot about them on May 6 when I commended him for taking the house and the country into his confidence. Why did he only give notice last Friday of his change of mind with respect to these matters? I want to remind the minister that this particular bill was called on June 9, I think.


Donald Methuen Fleming: No.


William Moore Benidickson: If there is any merit to these amendments, why did he not introduce them long ago? In all my experience in the house I have never known the minister to give such short notice as he gave us today, not on this bill, I admit, but with respect to a report he received last August. This is typical of the minister. Last August he received a report in connection with the deficit in the superannuation fund and he brought it before the house this morning at eleven o'clock when the matter was coming up today.


Donald Methuen Fleming: Mr. Speaker, I suggest that there must be some limit to the strayings of the hon. member. He is now talking about something that was dealt with earlier in the day and has nothing to do with this matter. Can the hon. member stick to the bill for a little while?


William Moore Benidickson: I think that in this case the Minister of Finance at long last has a valid point of order. I have opposed him for some three years and in all that time he has never advanced a point of order that was not entirely out of line with the leniency that was always extended to him when he sat on this side of the house and was a very superior, capable and active critic of budget resolutions.
I want to say that in examining this bill we must recognize that if we approve the rates and schedules that are involved-forgetting all about what the former government did-as the minister himself said in his budget speech of March 31, the program for 1959-60 it is estimated will take in personal income taxes $1,555 million and corporation 79951-0-326
Income Tax Act
income taxes, $1,140 million for a total of $2,695 million. The minister's forecast is that under this bill he will for next year raise in personal income taxes $1,750 million, under corporation income taxes, $1,340 million, for a total of $3,090 million, which represents an increase of $400 million of taxes over what was taken from the Canadian people under the present administration, and not even related to the previous administration, which administration was so severely condemned by the minister who is facing me at the present time and by the Prime Minister (Mr. Diefenbaker).
This is the type of thing upon which the government of this country got elected. I have a quotation here from the Windsor Daily Star of May 10, 1957.


Mr. Pearkes:: Who got elected on that?


William Moore Benidickson: You tried to get elected on that. This is what the Prime Minister said, referring to the previous administration:
They have refused to reduce the awful load of income taxation which bears down on all. They have refused to take adequate action for the old age pensioners-
And so on.
They have done this because-


Some hon. Members:: Hear, hear.


William Moore Benidickson: Look at all these backbenchers who are applauding, and who got elected on the grounds that they were going to reduce income taxes. This is what the Prime Minister said in Windsor, in 1957:
They have done this because an all powerful party ruling ...
Right now, are we going to pass legislation that involves taking from the Canadian people in income tax a greater intake by about a billion dollars than was taken by the previous administration? Are we going to do that solely because there is not sufficient criticism in this house from that large mass of supporters of the Minister of Finance in connection with a proposal such as he has in the bill that is presented to us? We have nothing in this bill, that compares with the propositions that were presented in 1957 or 1958 to the Canadian electorate. I think the Minister of Finance should, in these various instances, indicate to us why he comes before us without introducing into this bill the items which in 1956 and 1957, when he was the financial critic, he said were essential to the economy of this country.


Erhart Regier: I should like to assure the minister immediately that any efforts contained in the bill to plug what he chose to call "loopholes" are going to receive our endorsement. I regret that the minister has not deemed it advisable

Income Tax Act
to include in the bill now before us the plugging of a lot more loopholes that exist in the present act. I would have liked to have noted that he had taken a long look at existing allowances for depreciation and depletion, and that he had curtailed greatly these allowances. I believe that the restrictions in our existing Income Tax Act are such that even the president of the Canadian stock exchange underlines the great allowances permitted to Canadian corporations for reinvestment purposes by reason of the fact they are able to obtain these funds from the depreciation and depletion allowances permitted them under the existing Income Tax Act. I believe this is a loophole that the minister might well have plugged, since these allowances amount to about $3 billion per year and, in the opinion of many investment people in Canada, the rates are excessive and, in themselves, harmful to the Canadian economy.
I had hoped also that the minister would have plugged the loopholes a little more thoroughly in regard to the very lavish expense allowances being permitted to executives of corporations doing business in Canada. A number of cases are on record where these extraordinary concessions allowed business executives amount to much more than the wages of those executives. There was one famous case before the Exchequer Court of Canada for decision in which the severance pay demanded by a certain oil company executive amounted to no less than a million dollars. He was granted that amount for relinquishing his position with one company and moving over to another company. I was glad to note that the Exchequer Court of Canada decided that here was a loophole that ought to be plugged, and they did plug it in that particular instance.
Another loophole which, in our opinion, is in urgent need of plugging is the obtaining of money when capital gains are made which are not included as income. The minister, in looking for loopholes to be plugged, has not realized that a change in the definition of what is regarded as income for taxation purposes to include capital gains would have yielded him a lot more revenue than even he anticipates at this time.
I would hope also that, if not this year maybe next year, the government will give very earnest consideration, when amendments are again brought before this house in regard to the Income Tax Act, to putting corporations on the same basis as they now put individuals, and that the income tax payable by corporations would be on a graduated basis rather than on a flat basis. If this government is concerned about the growth of big business, if this government is anxious

to help the small, independent business survive and prosper, if the proposed graduated income tax is right when it is applied to individuals, then I have yet to hear one argument that the graduated income tax ought not to be applicable to Canadian corporations. I believe many of the evils of our economic society would be overcome if we were to make the same law in regard to graduated income tax applicable to Canadian corporations as is applicable now to individuals. Much other legislation would then be unnecessary because of the evils that would have been overcome by this new imposition of a graduated income tax under the existing Income Tax Act.


Mr. L. D. Crestohl (Cartier):: I rise, Mr. Speaker, to draw the attention of the minister to what I hope he might consider to be an omission which perhaps could be remedied. We have always expressed great concern, as we have done recently, for the education of the youth of our country at the universities and we have taken steps in that direction. However, because of the continued increase in the cost of school fees and in the cost of instruments-and certainly I could quote, for example, at medical schools the question of the purchase of microscopes and extremely costly books-I wonder whether the minister and the government would not consider allowing as an exemption from income tax the payment of school fees to universities and other institutions of higher education. That action would encourage attendance at the universities and would facilitate more opportunities for education. Where a father, an uncle or a relative pays the school fees for a child at a university I think it is a service to the country to encourage that generosity and to make such action possible. It would be an encouragement if these school fees and the cost of instruments and books were to be exempt from income tax.
Let me quote an illustration. Certainly there are wealthy relatives who would be pleased to pay for the education of a nephew or a niece or to pay the school fees, and they would do it gladly if they could be encouraged by having these school fees and these payments or advances made exempt from income tax. The same thing would apply even to corporations. If a corporation knew that any scholarships for which they paid would be exempt from income tax, notwithstanding their munificence and contributions for that purpose, I think there would be more encouragement. I regard it as being a real service to the country for the government to do everything possible to make education at the universities or higher education increasingly possible.

I feel that thought in that direction by the government would be welcome throughout the country and certainly would assist education. I bespeak this aid for these young men and women who find it difficult to pay the increasing cost of school fees, whose parents of modest means cannot afford to pay for their education, but who could easily obtain assistance from corporations or perhaps from relatives of more comfortable means to pay for this education. Provision for that exemption, I suggest to the minister, would be a constructive piece of legislation to incorporate into our Income Tax Act, namely of all school fees of universities or other institutions of higher education. I am speaking of related seminaries or, if there are such things, technical schools that are considered to be on a higher level of education. By doing that I think the government would be enacting a popular piece of legislation. Not only would it be popular with the taxpayers but it would be in conformity with our genuine desire and urge for university education in Canada.
I make that as a suggestion to the minister. 1 do not see provision for it in this bill. I am wondering whether, between now and the time we reach clause by clause study of the bill, he will consider the introduction of such an amendment so that we might get into this act one section that would be more popular perhaps than are many of the sections that are now in the bill.


Mr. Speaker:: May I remind the house that if the minister speaks now he will close the debate.


Donald Methuen Fleming: The hon. member for Kenora-Rainy River (Mr. Benidickson) was not any clearer this evening than usual. However, he somehow said that taxes had been increased for the people who constitute the great bulk of the Canadian taxpayers. He was completely wrong. I propose to quote what I had to say on this subject in the budget speech of 1959. This is to be found at page 2417 of Hansard, of April 9, 1959, in the second column, where, summarizing the tax changes in the 1959 budget and comparing the income tax position of the great bulk of Canadian taxpayers with their tax position prior to the change of government three years ago tomorrow, I had this to say:
The best way to illustrate the effect on the individual is to compare the taxes which will be payable in a full year after this year's changes with the taxes payable in 1957 prior to the reductions we introduced in that year. For purposes of comparison, let us consider the position of a typical married man who is the father of two children of family allowance age.
At an income level of $3,000 a year, under the new rates, this man will pay a total of income 79951-0-3264
Income Tax Act
tax and social security contribution of $56, an increase of $4 from the 1958 level. He will, however, be paying $34 less than he paid before the reductions we introduced in 1957.
At an income level of $4,000 a year, under the new rates, he will pay a total of $208, an increase of $14 from the 1958 level but $44 less than before the reductions we introduced in 1957.
At an income level of $5,000 a year, he will pay a total of $390, an increase of $24 from the 1958 level but $44 less than before the reductions we introduced in 1957.
At an income level of $7,500 a year, he will pay a total of $898, an increase of $68 from the 1958 level but still $2 less than before the reductions we introduced in 1957.
It is clear from these examples that even after the increases now being proposed the vast majority of taxpayers will be paying less in income tax and old security contributions than they paid prior to the reductions we introduced in 1957.
At the same time they are receiving the protection of a social security system which has been greatly improved and extended.
The hon. member for Kenora-Rainy River may find his way back to these facts some time soon. That will be our hope.
As to the matter raised by the hon. member for Cartier (Mr. Crestohl), may I say that this matter was discussed fully last year. He is aware of the additional burden we are carrying in the federal treasury now by reason of our increase from $1 to $1.50 in the per capita federal grants to the universities; that is per capita of population in each province. These are substantial additions that we have undertaken. I think there is little to be gained now in reviewing this question again. It could have been raised in the budget discussion but I do not believe it was raised there. It was discussed fully a year ago and I think the situation has not changed since that time. The government has done more for the assistance of universities than any other federal government has ever before done in Canadian history.


William Moore Benidickson: May I ask the Minister of Finance a question?


Donald Methuen Fleming: When we go into committee, I suggest.


William Moore Benidickson: Would the minister indicate whether or not-


Mr. Speaker:: Order. I take it the hon. minister who had the floor is not prepared to answer questions now.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Rea in the chair.
On clause 1-Estate tax and succession duties applicable to certain property.
Charles Edward Rea: Order. House in committee on Bill No. C-68, an act to amend the Income Tax Act and also the proposed amendments which are appended to Votes and Proceedings.

Income Tax Act
Shall clause 1 carry?


William Moore Benidickson: Mr. Chairman, on this clause I would like to refer back to page 4591 of Hansard, the explanation which I think is not now a fully responsible explanation for the Canadian public to be given by the Minister of Finance with respect to the intent of this legislation. Although I am sure the minister has read the debate in the other house on the Estate Tax Act, there was reference in the course of it to certain amendments such as those which are before us in this house. There was reference to the fact that the other place referred the amendments of 1958, certain proposals of the Minister of Finance, back to us. The over-powering majority in this house rejected them.
To what extent have we here a recognition of the non-political judgment that might have been exercised in the other place when they considered the elements involved in a matter of this kind?


Charles Edward Rea: Shall clause 1 carry?


William Moore Benidickson: Well, is the minister not going to reply?


Donald Methuen Fleming: Mr. Chairman, that is a political question. The hon. member has not asked for elucidation of this clause. I am prepared to offer to elucidate the clause if any hon. member asks.


William Moore Benidickson: Then we can go on for some time. Has the minister before him, and I am sure he has because his officials formerly always prepared a very excellent book of words clause by clause, any reference to what the recommendations were from the committee of the other house with respect to this matter?


Donald Methuen Fleming: Mr. Chairman, we do not discuss what transpires in the other place; it is quite out of order to do so.


William Moore Benidickson: Mr. Chairman, I want to say we very definitely discussed what happened in the other place.


Donald Methuen Fleming: When the other house is dealing with a matter and sends it back to us, then this house deals with it. But with great respect we do not discuss the proceedings in the other place and it is quite out of order to do so.


William Moore Benidickson: Mr. Chairman, I am referring to the fact that last year we discussed the merits of a proposal that came from the other house. The overriding majority of the government defeated it here, but it seems to me it is back here before us. I wonder if the minister with the help of the staff that is in front of him would indicate
[The Deputy Chairman.)
to us to what extent this complies with the legislation that was presented to us last year which we rejected?
The Depuiy Chairman: Shall clause 1 carry?


William Moore Benidickson: Is the minister not going to assist the committee?


Donald Methuen Fleming: Mr. Chairman,
there was no amendment last year to the Income Tax Act in this regard. If the hon. member wishes to talk about another act altogether, or about what happened with that other act last year, or what happened to a bill to amend that act this year in the other place, it is completely out of order.


William Moore Benidickson: Mr. Chairman, I would not have risen to say anything further had it not been for the fact that I am quite sure that very competent lawyers whose evidence I have read in committees of the other place have asserted that we are doing here, by means of the Income Tax Act amendment, what the other place suggested we should do when admittedly they had before them the Estate Tax Act. The two are related in the resolution now before us-
The Depuiy Chairman:	Order. I cannot
understand how the hon. member can show that what he is talking about is relevant to clause 1 of this bill.


William Moore Benidickson: Mr. Chairman, have you looked at the left hand sidenote, "Estate tax and succession duties-", which relates to this clause, and are you satisfied that I am not in order in asking about the co-relation between this clause and the legislation that was before this house last year?


Erhart Regier: I wonder if the minister might at this stage supply us with an answer as to why he has not included in the bill adequate amendments so that corporations would also be liable to graduated income tax, as are individuals?


Donald Methuen Fleming: Mr. Chairman, with respect, that question does not arise on this bill. The proper place to raise questions of this kind is in the budget debate which took place two months ago. There is nothing in this bill which relates to that subject at all.


Erhart Regier: On that point of order, Mr. Chairman, if clause 1 has any significance at all, I should be allowed to ask this. It always has had great significance in committee when we are amending the whole of an act to this great extent. I submit we ought to be entitled to ask this question, and it is the only place where we can ask the minister why the act has not been amended in other respects.


Charles Edward Rea: Order. It being ten o'clock shall I rise, report progress, and ask leave to sit again at the next sitting of the house?


Some hon. Members:: Agreed.
Progress reported.



BUSINESS OF THE HOUSE

Lionel Chevrier: May I inquire from the house leader what we will be doing tomorrow and Wednesday?


Mr. Churchill:: Tomorrow, Mr. Speaker, after consultation with representatives on the other side of the house it seems advisable to continue with this bill and, on a reasonable allocation of time, we might complete it by, say, one o'clock. Then we will carry on with the motion in the name of the Minister of National Revenue to set up a select committee on broadcasting; that would be item No. 2.
Business of the House
The third would be item No. 10 on today's order paper, the resolution in the name of the Minister of Justice with regard to the Judges Act. Fourth would be item No. 4 on today's order paper, the Emergency Gold Mining Assistance Act which we have had before us on several occasions. Fifth would be second reading of Bill No. S-32 concerning a bridge over the St. Lawrence river. If we make good progress we could complete item No. 1 on today's order paper which would be the last item, Bill No. C-72 with respect to the Canadian National Railways.
On Wednesday we will continue with the estimates. We will take those of the Department of Mines and Technical Surveys which have already been started and those of the Department of Fisheries.


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