1961-04-17

Hon. Gordon Churchill (Minister of Veterans Affairs) moved:: That items numbered 453 to 478 inclusive, and items 494 and 495, as listed in the main estimates 1961-62, relating to the Department of Veterans Affairs, be withdrawn from the committee of supply and referred to the standing committee on veterans affairs, saving always the powers of the committee of supply in relation to the voting of public moneys.


[Stage Direction]
Motion agreed to.


Hon. D. J. Walker (Minister of Public Works):: Mr. Speaker, I should like to inform the house of certain actions being taken by the government to develop a secondary mortgage market in Canada and thus to increase the flow of private investment into housing and contribute to greater stability in the construction industry.
Since 1954 the National Housing Act has provided for the purchase and sale of insured mortgage loans. Activity in this field, however, has never been very substantial. The result has been that in periods of reduced private investment in N.H.A. mortgages very large amounts of government funds have had to be made available to Central Mortgage and Housing Corporation for direct lending purposes.
The first step necessary to encourage an active market is to ensure that there is an ample supply of existing mortgages available to interested buyers. Accordingly the government has instructed C.M.H.C. to offer for sale as soon as possible, at reasonably attractive yields to investors, mortgages now held in its portfolio as a result of the extensive direct lending operations it has undertaken since this government took office in 1957. The saleable component in the C.M.H.C. portfolio exceeds $750 million, and the corporation will make available for sale whatever portion is required to lay a firm basis for an active market.
90205-6-234J
The government is confident that the development of an active secondary mortgage market will create not only a more regular but actually a larger demand for N.H.A. mortgages. The ability to dispose of mortgages in the market should encourage approved lenders to undertake more lending. However, if a secondary mortgage market is to be developed and maintained it is apparent that there will have to be greater flexibility in the determination and setting of the maximum N.H.A. rate on new mortgages and this rate will have to be kept more closely in line with other long term interest rates. Accordingly the government proposes, under section 4 of the National Housing Act, a semi-annual review of the N.H.A. interest ceiling having in mind the long term yield on government bonds prevailing at that time.
It is anticipated that the market will develop in two ways; through the sale of blocks of mortgage loans by one institution to another or among pension funds and trusts, and through sales to a new type of company, some of which are already in existence, which would enable the small investor to participate in the mortgage market through purchase of its debentures or shares.
The prices at which N.H.A. insured mortgages are to be sold will depend. of course, upon many considerations, including the interest rate at which the mortgage was written, the life of the mortgage still to run and the condition of the capital market at the time of sale. It is quite apparent that a mortgage bearing 6 per cent interest will sell at a price less than one bearing 6f per cent interest. Let me make it perfectly clear, however, that the sale of mortgages by C.M.H.C. does not in any way affect the interests of borrowers, which are defined when the mortgage is issued and do not change when it is sold.
There remain several technical and procedural matters to be resolved. I was sure, however, that the house would want to know of this further significant step which the government proposes for the promotion of housing and the development of the Canadian capital market.


Mr. Erharl Regier (Burnaby-Coquillam):: Mr. Speaker, I should like immediately to welcome any intention of the government to establish in our nation a well organized market for the sale of mortgages. This effort is long overdue,

Housing
because we have regrettably witnessed an undue amount of racketeering which has obtained over the years in this field.
While I welcome what I hope is the basic intent of this government, I regret to note the minister's announced intention of offering to the market no less than-if I heard him correctly-$750 million worth of mortgage paper and to accept a price for this paper that, as he said, is subject to many considerations. As I view the market today, this could cause the taxpayers of Canada a loss of $75 million if we assume that the discount at which these papers are to be offered is not to be greater than 10 per cent.


Mr. Fleming (Eglinton):: That is outlandish.


Erhart Regier: I regret very much that the government has so much allegiance to the money lenders of Canada and so little allegiance-


Mr. Speaker:: Order. The hon. member is entitled to disagree with the announcement of policy, but this is not the time to debate the matter or to make statements of the kind upon which he has just embarked.


David James Walker: Mr. Speaker, the hon. member has not been listening to my statement. He is putting forward a completely false interpretation of the whole matter.


Mr. Speaker:: Order. I think perhaps-


Erhart Regier: I wonder whether I might ask the minister a question.


Mr. Speaker:: Order. The minister would be in order to correct a misapprehension about his statement which has been made evident by the comment of the hon. member for Burnaby-Coquitlam.


David James Walker: Mr. Speaker, the statement will speak for itself and perhaps the hon. member will read it when it appears in Hansard tomorrow.

On the orders of the day:


Erhart Regier: should like to ask the Minister of Public Works, in the light of his announcement earlier today, whether this parliament may expect legislation in respect of the announced intention of the government to establish a mortgage market for real estate in Canada?


David James Walker: I want to thank the hon. member for Burnaby-Coquitlam for asking this question, but I do not believe legislation will be necessary. We can make the amendment to the regulations.


Mr. W. H. McMillan (Welland):: I should like to direct a question to the Minister of Public Works. What actual loss to the treasury of Canada is contemplated from the sale of N.H.A. mortgages, as announced by the minister earlier?


David James Walker: None, Mr. Speaker.



SIR JOHN A. MACDONALD ESTABLISHMENT OP LEGAL HOLIDAY IN MEMORY

Mr. Jack Wratien (Brantford) moved: for leave to introduce Bill No. C-83, respecting Sir John A. Macdonald day.


Some hon. Members:: Explain.


Jack Wratten: Mr. Speaker, the purpose of the bill is twofold; first, to establish the Monday following February 15 in each year as a legal holiday and, second and most important, to name this holiday Sir John A. Macdonald day in memory of Canada's greatest statesman, the father of confederation and our first prime minister.
Motion agreed to and bill read the first time.



MOTIONS FOR PAPERS


[Stage Direction]
Motion No. 100-Mr. Argue:
For a copy of any contract, letter of intent, correspondence, or other documents, exchanged between Eldorado Mining and Refining Limited and The United Kingdom Atomic Energy Authority since January 1, 1956, in relation to the purchasing of Canadian uranium concentrates by The United Kingdom Atomic Energy Authority.
Gordon Minto Churchill: Mr. Speaker, a similar motion was presented just prior to the Easter recess, and when the item was called on March 29 the Minister of Trade and Commerce suggested to the hon. member that the motion be rephrased. In the course of his remarks, which are to be found on page 3459 of Hansard, the Minister of Trade and Commerce said:
It would be understood, of course, that the production of these documents would require the prior consent of the other parties to this correspondence.
During the Easter recess the views of the United Kingdom authorities were sought, and they have intimated that in their opinion negotiations between Eldorado and the United Kingdom atomic energy authority would be seriously prejudiced if the documents were tabled. In the circumstances, therefore, the motion cannot be accepted.


Mr. Speaker:: In view of tne explanation made by the minister, what is the wish of the mover?


Mr. Argue:: Withdraw it.


Mr. Speaker:: Dropped.
Order discharged and motion withdrawn.



CANNED PORK DONATIONS, CHARITAELE PURPOSES

[Stage Direction]
Motion No. 101-Mr. Argue:
For a copy of all correspondence exchanged between the federal government and any agency thereof, and any provincial or municipal government, or any institution or organization, since December 11, 1959, regarding the distribution for charitable purposes of canned pork luncheon meat acquired by the agricultural stabilization board.
Hon. Alvin Hamilton (Minister of Agriculture):: With the usual reservations, Mr. Speaker.


Mr. Speaker:: Would the minister specify the reservations?


Francis Alvin George Hamilton: Those involving the provincial governments. We have to get their prior approval.


Mr. Speaker:: Subject to the reservation expressed by the minister, is it the pleasure of the house to adopt the motion?


[Stage Direction]
Motion agreed to.

[Stage Direction]
Motion No. 102-Mr. Badanai:
For a copy of any correspondence between Mr. V andenHeuvel of Goderich, Ontario, and the Minister of Citizenship and Immigration, or any officials of her department, since January 1. 1961.
Motion agreed to.
Motion No. 104-Mr. Badanai:
For a copy of any correspondence between Mr. VandenHeuvel of Goderich, Ontario, and the Minister of Labour, or any officials of his department, since January 1, 1961.
Motion agreed to.

[Stage Direction]
Motion No. 105-Mr. Regier:
For a copy of all correspondence received by the Department of Transport complaining of the operations of CHEK-TV in the lower mainland of British Columbia, and for a copy of all replies to these complaints.
Motion agreed to.


[Stage Direction]
On the orders of the day:
Hon. Lionel Chevrier (Laurier):: Mr. Speaker, may I ask the Prime Minister when
Inquiries of the Ministry we may expect a statement of policy on behalf of the government in connection with the report of the royal commission on transportation.
Right Hon. J. G. Diefenbaker (Prime
Minister): I can only say, Mr. Speaker, that the royal commission report is receiving the consideration of the cabinet, and when a decision is made on the recommendations or any of them the house will immediately be made aware thereof. I realize that early consideration must be given to this most important report, but it is one that requires a great deal of intensive study, as the hon. gentleman will realize. As soon as the government is in a position to inform the house as to the course to be followed, that will be done.


Lionel Chevrier: May I ask a supplementary question, Mr. Speaker. In the light of the statement made by the Prime Minister during the debate on the Maintenance of Railway Operation Act, that after the report of the royal commission was tabled legislation would then be introduced, when may we expect this legislation?


Mr. Diefenbaker:: Mr. Speaker, there is nothing inconsistent in what I have just said. The answer I have just given covers the situation very thoroughly, I think.


Lionel Chevrier: May I ask a further supplementary question. Has the Prime Minister seen the article by Mr. Blakely in this morning's issue of the Gazette in which he states that parliamentary reaction to the MacPher-son report has been mixed and that the government views it with misgivings? Has he any comment to make thereon?


Mr. Speaker:: Order. I think the hon. member for Laurier will appreciate that the question is really not a question, in that it cites an expression of opinion and asks the Prime Minister to express his opinion. This matter might more properly be introduced during debate.


Hazen Robert Argue: May I ask
a supplementary question. Can the Prime Minister say whether it is the intention of the government to extend the legislation which provides for a freeze on freight rates, or does the government intend to have other legislation brought in before the end of the month?


John George Diefenbaker: Mr. Speaker, I think I have made the situation quite clear. The hon. gentleman's question will be answered, of course, when the government makes known its views in respect of the transportation report.

Inquiries of the Ministry NORTHERN AFFAIRS



FAILURE OF MINISTER TO VISIT ARCTIC ISLANDS

[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kootenay West):: wish to address a question to the Minister of Northern Affairs and National Resources. In view of the fact that Canada's claim to the islands of the Canadian archipelago were established by the raising of our flag on Ellesmere island and a proclamation by Commander Low in the early years of this century, and in view of the apparent necessity constantly to emphasize Canada's sovereignty over the islands of the Canadian archipelago, will the minister explain to the house why, in his first official visit to the northwest territories, his itinerary did not include a single point north of the mainland of Canada?


Hon. W. G. Dinsdale (Minister of Northern Affairs and National Resources):: Mr. Speaker, I should like to thank the hon. member for giving me notice of his intention to ask this question. I should like to assure him that Canada's claim to the Canadian Arctic archipelago actually predates the incident to which he refers.
So far as my own visit to the territory is concerned, may I say that during the Christmas recess I visited the Yukon territory. During the Easter recess I visited the northwest territories. As soon as possible I hope to visit the eastern Arctic and the Canadian archipelago. In the meantime my colleague the Minister of Justice (Mr. Fulton) made a thorough tour of the eastern Arctic during the Easter recess.
(Translation):



HARBOURS


[Stage Direction]
On the orders of the day:
Mr. J. P. Deschaieleis (Maisonneuve-Rose-mont):: Mr. Speaker, I should like to put a question to the Minister of Transport.
Could the minister inquire of the national rarbours board authorities about the reason for prohibiting access to the Montreal harbour since last Saturday, to the residents of Montreal and especially to hundreds of anglers who were in the habit of engaging in their favourite sport there? Will the minister see to it that this ridiculous order is cancelled?
Hon, Leon Balcer (Minister of Transport):
Mr. Speaker, I shall inquire immediately into the grievance voiced by the hon. member for Maisonneuve-Rosemont.
(Text):



WATER RESOURCES


[Stage Direction]
On the orders of the day:
Mr. Walter Pitman (Peterborough):: I should like to submit a question to the Minister of Transport. I apologize for being late in giving him notice, and perhaps the minister will take the question as notice. Has the minister received a brief from the Peterborough chamber of commerce with regard to the Trent waterway system? If so, can the minister assure the house that there will be no change in policy in regard to the present water levels, as requested in this brief?


Hon. Leon Balcer (Minister of Transport):: I will take this question as notice.



PUBLIC SERVICE


[Stage Direction]
On the orders of the day:
Mr. Arnold Peters (Timiskaming):: I should like to ask the Prime Minister a question arising out of a newspaper report appearing
in Saturday's issue of the Globe and Mail announcing the appointment of the well known Canadian publicist, John Fisher, to the staff: of the Prime Minister. Will the Prime Minister inform the house whether this news report is correct? If so, what are the duties of Mr. Fisher?


John George Diefenbaker: Mr. Speaker, the appointment was not announced. The fact was announced that at the end of May John Fisher will commence his duties as a special assistant with particular reference to preparations that are to be made in connection with the centennial to which we are all looking forward. While I am on my feet may I say that when the formal appointment is made, the suggestion that he will receive more than $10,000 a year is completely unwarranted.



BUSINESS OF THE HOUSE


[Stage Direction]
On the orders of the day:
Lionel Chevrier: May I
direct a question to the Prime Minister and ask if he will not make a statement in the house at a later date concerning the legislative program he has in mind from now until the end of the session, over and above that which is on the order paper.


John George Diefenbaker: In reply to the hon. member for Laurier may I say this. Today, April 17, is the eighty-fourth sitting day of this session, and I think early consideration should be given to a motion being made in the house to extend the hours of sitting. Recently I was in the United Kingdom and, as the hon. gentleman knows, right from the beginning of the session there the hours are considerably longer than the hours this house sits. I would think we might be in a position later this week to make a motion whereby, if the house would agree, an extension of the hours might take place, at which time we should place before the house in general the legislative program which must be faced in the days ahead.
The session began in November. I had hoped, and it had been the expectation of many hon. members, that they would be able to go home and spend the summer months of July and August with their families, because most of them who are married find themselves separated from their families at vacation time.


An hon. Member:: A lot of them are there now.


John George Diefenbaker: That may also make it necessary for consideration to be given, in the event that the legislative program would carry us beyond the first of July, to the suggestion that if the program should not be completed by that time we might adjourn for six weeks and then return to complete the work of this session, because a lot remains to be done.


Some hon. Members:: Hear, hear.


John George Diefenbaker: I am sure that in a spirit of co-operation what I have suggested is going to appeal to hon. members in all parts of the house.


Lionel Chevrier: In the light of what the Prime Minister has said, does he not think that before placing a motion on the order paper, or at least before the motion comes up for discussion, he should indicate to the house what the legislative program is to be from now until the end of the session?


John George Diefenbaker: I have already said that when later this week a decision is reached by the house, at that time, before the decision is made, I should think it would be proper that the house be taken into the confidence of the government and made aware of the very large program which still remains to be dealt with before this session can be completed.
Inquiries of the Ministry THE CENSUS



INQUIRY AS TO RECRUITMENT OF WORKERS

[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: wish to address a question to the parliamentary secretary to the Minister of Trade and Commerce. In view of the present unemployment situation can the parliamentary secretary assure the house that in the appointment of census takers, needy, capable persons will be given first consideration regardless of party affiliation?


Mr. E. L. Morris (Parliamentary Secretary to the Minister of Trade and Commerce):: This is no different from a question which was asked only a few days ago, when I pointed out that the appointment of census enumerators rests with the census commissioners. That policy has not changed.


Herbert Wilfred Herridge: I might remind the parliamentary secretary that the previous question-


Mr. Speaker:: Order. If the hon. member has a supplementary question to ask, well and good, but he has not the floor if he wishes to make a statement.


Herbert Wilfred Herridge: Does not the parliamentary secretary appreciate the fact that he failed to appreciate the difference between the census commissioners and census enumerators?


Edmund Leverett Morris: I think it unlikely that I would misunderstand the difference between a census commissioner and a census enumerator.



SASKATCHEWAN


[Stage Direction]
On the orders of the day:
Mr. A. C. Cadieu (Meadow Lake):: May I
ask the Prime Minister whether he is able to report on the latest developments in regard to the situation created by the withholding of the royal assent by the lieutenant governor of Saskatchewan.


John George Diefenbaker: As the house knows, before the Governor General can give consideration to such reservation it is necessary for the lieutenant governor to place before His Excellency not only the legislation which has been reserved but the reasons for the reservation. A few days ago I was asked a question in this connection and at that time, as the hon. member knows, I stated that as yet no report had been received from Mr. Bastedo, the lieutenant governor of Saskatchewan.

Inquiries of the Ministry
However, on April 15 the lieutenant governor sent a letter to the Governor General and a copy thereof to the Secretary of State to which was attached the documents to which I have already made reference, with the exception of one to which reference is made in the report, namely the recommendations of a royal commission known as the grain commission which was set up apparently pursuant to a request by the government of Saskatchewan.
As I say, the material has just now come into the hands of the government, and an immediate and early examination will be made. Any determination in connection therewith will, of course, be transmitted first to the lieutenant governor and then to the premier of the province of Saskatchewan.


Hazen Robert Argue: A supplementary question. I wonder if the Prime Minister could say whether or not the law firm with which Mr. Bastedo is connected has a direct pecuniary interest in the outcome of this legislation-


Mr. Speaker:: Order. I had occasion the other day to remind the hon. member that it is not in order in this house to make statements which reflect in any way, either directly or by inference, on the conduct of Her Majesty's representatives, and I trust he will not offend in that respect.


Hazen Robert Argue: On the point of order, is it not in order to ask? I made no accusation. I asked whether or not the law firm with which the lieutenant governor is connected has a direct pecuniary interest-


Mr. Speaker:: Order. I heard the hon. member's question and it seemed to me, in my best judgment, that it was a question which cast a reflection on the conduct of the lieutenant governor.


Hazen Robert Argue: Only if he has a connection.



EXTERNAL AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. R. J. McCleave (Halifax):: I wish to direct a question to the Secretary of State for External Affairs. Has the hon. gentleman any report to make on the safety of Canadians in Cuba, where some form of civil war has now broken out?


Hon. Howard C. Green (Secretary of Stale for External Affairs):: Such reports as are available to the Department of External Affairs indicate that military operations have taken place today in several parts of Cuba. The situation is confused, and it is too early for me to make any useful comments at

this time. We have, of course, been in touch with the Canadian embassy in Havana, and are keeping a close watch on events. Plans have been worked out to be put into effect at short notice to assist Canadian citizens in Cuba should that be necessary.



COMBINES


[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Port Arthur):: Mr. Speaker, I would like to direct a question to the Minister of Justice. In view of recent proceedings taken by the United States attorney general against General Motors in respect of the alleged monopoly it has in the manufacture of buses, and since buses produced by this same company, in a large part in the United States, may dominate our market for buses, has the minister or his officials of the combines investigation branch considered an investigation in Canada into this particular phase of General Motors operations here?


Hon. E. D. Fulton (Minister of Justice):: Not
to my knowledge, Mr. Speaker, but if the hon. member has reason to believe that there is an improper monopoly in the manufacture of diesel buses in Canada I should be very grateful if he would bring it to the attention of the proper officials.


Douglas Mason Fisher: I would like to ask a supplementary question. The question did not refer to diesel motors but to buses, and I would ask the minister if he does not remember that we had a bus company close in Fort William because of the competition from General Motors buses.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Hazen Robert Argue: I would like to direct a question to the Minister of Justice. On March 29 I asked the Associate Minister of National Defence whether the army would respect the picket line established at the Rainbow Laundry and Dry Cleaners in Regina. In view of the discontinuance of army deliveries through the picket line as a result of the associate minister's statement in the house, may I now ask the Minister of Justice whether the R.C.M.P. will, in like manner, respect the picket line.


Edmund Davie Fulton: While I thank the hon. gentleman for giving me notice of his intention to ask this question, I was not able to obtain information, in

the time at my disposal, as to whether or not the R.C.M. police do in fact make any calls or have any occasion to go in and out of this laundry. I have to make these inquiries first, and will give the hon. member an answer as soon as I can.



CUSTOMS TARIFF

Donald Methuen Fleming: the second reading of Bill No. C-72, an act to amend the Customs Tariff.
He said: Mr. Speaker, Bill No. C-72 is the last of the measures arising out of the supplementary budget of December 20 last awaiting enactment. It is in precisely the same form as the resolution which was reported back to the house by the committee of ways and means on March 2. That resolution, quite apart from the budget debate in December and January last, was debated in the committee of ways and means on February 1, 2, 3, 15 and 27, and on March 2. I trust, therefore, that the ground has been quite fully covered and it will not be necessary to traverse the same ground at length.
In the present debate we are concerned with the principle of the bill. May I define what I conceive to be the principle of the bill. The concept of "class or kind" goods in the Customs Tariff dates, in its present form, from the Fielding budget of 1907. The concept really made its first appearance in the Customs Tariff in 1873. The concept contemplates that there shall be different customs duty rates with respect to goods, depending upon whether those goods are of a class or kind made in Canada. If they are not of a class or kind made in Canada the Customs Tariff rate is lower. If they are of a class or kind made in Canada the customs duties are accordingly higher.
Not only does the rate of customs duty differ depending upon the determination of this question, but the application of dumping duty as well. We have had provision for dumping duties in our legislation since 1904, and it is open to the government to apply dumping duties only in the case of goods of a class or kind of goods made in Canada. The purpose of such legislation, undoubtedly and unblushingly, is protective; it certainly was in 1907 and has been ever since. It is intended to provide encouragement for the manufacture and production of goods in Canada. The expression appears in numerous items of the Customs Tariff, indeed 70 or more.
The interpretation and application of these terms in the Customs Tariff presented really no problem until the last decade, but in this last decade the course of decisions has been to erode the accepted meaning of these words and reduce the intended benefit to Canadian 90205-6-235
Customs Tariff
producers. Indeed, the course of decision in this decade has created some quite extraordinary results; one which engaged the attention of the committee of ways and means was the shovel case. This was the case of the import of a power shovel having a 2J-yard capacity. It was competitive with a 2-yard shovel which was made in Canada but, because the 2|

yard size had never been made in Canada, it was held that such machines were of a class or kind not made in Canada, regardless of the fact that the facilities existed in Canada for the manufacture of a 2J-yard shovel.
We are living in the era of GATT, and have for the past 14 years. We support GATT, and under GATT trade advantages in markets of different countries are a matter of bargaining and agreement. For reductions in the Canadian tariff in favour of imports from other countries we bargain, and often bargain hard, for a price: a price in the form of similar advantages extended to Canadian exporters in the markets of the foreign country or countries concerned. When, in the course of bargaining, common ground is reached in regard to the price to be paid, that is to say in terms of mutual exchanges of tariff advantages, then we enter into an agreement with such country or countries. We do not give advantages of this kind away for nothing in this era of GATT.
Under GATT rates of customs duties are bound. Never has the definition of "class or kind" been bound under any GATT agreement. Erosion of the meaning of the expression has, therefore, given advantage to other countries exporting to Canadian markets, advantages for which they never bargained and for which they never paid Canada a price in the form of concessions to Canadian exporters, an advantage which those countries never expected. In brief, it was simply a windfall to them.
We cannot afford to give windfalls for nothing to other countries in terms of advantages in Canadian markets in this way. The erosion which has continued has cost and is costing jobs to many Canadians. This legislation aims at restoring those jobs to Canadians.
The issue presented by this measure is whether we wish to see unemployment in Canadian industries which, as a result of the erosion of the past decade, have lost the advantages they previously enjoyed. I say that the principle of this bill then relates to the clarification of a definition with a view to restoring the value of those provisions in the Customs Tariff to the position that they were recognized to have prior to the decade of erosion.
What, then, is the effect of the bill, Mr. Speaker? The bill-

Customs Tariff


Mr. Mcllrailh:: Will the minister permit a question at this time, before he leaves the subject of erosion?


Donald Methuen Fleming: I shall be coming back to that later, and I think I can satisfy the inquiry of the hon. member at that time.
The effect of the bill is to divide certain imported goods into two classes. First there are shelf goods and, second, there are custom made goods according to specifications. As to the shelf goods which, of course, will be in the majority, the measure will provide that goods will be deemed to be of a class or kind made in Canada if goods of approximately the same class or kind are made or produced in Canada. There is a condition that they shall not be so deemed to be of a class or kind made in Canada unless at least 10 per cent of the normal Canadian consumption thereof is made or produced in Canada. In this respect the condition which now is to be found in order in council No. 1618 of July 2, 1936, will be made in effect a matter of statutory enactment instead of executive decree, which it has been ever since 1936.
As to the second class of goods, namely those custom made according to specifications, goods of this nature will be deemed of a class or kind made in Canada if adequate facilities exist in Canada for the economic production of such goods within a reasonable period of time.
There is a condition applicable to both the shelf goods and those custom made according to specifications. The goods may be deemed to be of a class or kind not made or produced in Canada where similar goods made or produced in Canada are not offered for sale to the ordinary agencies for wholesale or retail distribution, or are not offered to all purchasers on equal terms under like conditions having regard to the custom and usage of trade.
Sir, the reasons for separating goods into two classes are obvious. The provisions for determining whether goods are to be deemed to be of a class or kind made in Canada are sound and reasonable. They will provide what, in the light of the erosion of the past decade, as a result of decisions, has been badly needed; namely, first a clear definition and, second, a restoration of the law as it was previously construed and applied before this decade of erosion. With the enactment of this measure, Mr. Speaker, we shall have for the first time a positive definition where previously there has been merely a negative limitation.
My next observation concerns the method of determination. Under the present law the decisions of the deputy minister of national

revenue are subject to an appeal which lies to the tariff board; that is to say, appeals from his decision with respect to whether goods are or are not of a class or kind made in Canada. The tariff board conducts hearings of such cases, in the legal expression, de novo. The appeals are not argued from the record in the previous stage of proceedings. A further appeal lies from the decision of the tariff board to the Exchequer Court of Canada on a question of law; similarly, an appeal lies from the decision of the Exchequer Court of Canada to the Supreme Court of Canada on a question of law. Both in the Exchequer Court and in the Supreme Court of Canada, of course, the appeal is argued from the record; there is no hearing de novo.
This bill makes no reference whatever to the subject of appeal. It does not abolish the right of appeal on findings on the question whether goods are of a class or kind made in Canada, but it does provide quite simply that as to three elements in such cases the decision of the Minister of National Revenue shall be final.
These three elements are, first, whether the goods in question are shelf goods or are custom made according to specifications; second, if they are shelf goods, what is the normal consumption thereof in Canada; third, as to the other class of goods, namely those goods made according to specifications, whether adequate facilities exist in Canada for the economic production thereof within a reasonable period of time. A full right of appeal continues with respect to leading elements such as the following: first, whether or not the imported shelf goods are of approximately the same class or kind as goods made in Canada; second, the determination of the amount of Canadian production; third whether or not the number of articles manufactured in Canada does in fact constitute a minimum of 10 per cent of normal Canadian consumption.
Under the provisions of the bill in the matters I have just now mentioned the house will recognize the advantage that the bill offers in that it will simplify procedure and expedite decision, and this will react to the advantage of business, including Canadian importers. Under the present law, with its uncertainties, there have been some very long delays, drawn out procedures, and great uncertainties which have been harmful to business operations.
Sir, as to some of the criticisms that have been heard in this regard, I should like to say at once that in my respectful submission there has been a great deal of exaggeration and misunderstanding. We are not taking

away the right of appeal. The bill will provide that with respect to three matters the decision of the minister in such appeal shall be taken to be final. In these three elements the minister is in the best position to make these determinations. They are largely on statistical questions, and moreover depend very largely on confidential information obtained from those engaged in business and trade, information that they are often quite loath to put forward in a public hearing before the tariff board because that information is frequently of advantage to their competitors.
Therefore, Mr. Speaker, I have to say that there has been a great deal of exaggeration in the views that have been expressed on this subject. Perhaps what has been said today will help to clarify the terms of the bill in this regard.
It has been suggested, Mr. Speaker, that there is something arbitrary about the kind of provisions that are contained in this measure. Well, one does not hear ringing cries that there has been arbitrary legislation enacted in similar respects by the mother of parliaments at Westminster. Let me draw attention to the kind of legislation that the mother of parliaments has passed in regard to this subject, and the method of determination that is provided under the United Kingdom legislation. I shall be reading certain extracts from a document issued by the board of trade and the commissioners of customs and excise of the United Kingdom. It is notice No. 339 for the year 1960. This is the way in which the law is described in this official publication of the government of the United Kingdom. The first extract relates to the provisions of the law itself, and reads as follows:
1. Law. (a) Liability to duty.-Under the import duties act, 1958, protective duties are normally chargeable on imported machinery in order to protect United Kingdom machinery manufacturers.
(b) Duty free admission.-Section 6 of the 1958 act and paragraph 1(b) of the fourth schedule thereto . . . provide that the treasury may, on the recommendation of the board of trade, direct that payment shall not be required of any duty chargeable under section 1 of the 1958 act on particular importations of machinery, (other than aircraft and parts or equipment for incorporation in or use on aircraft) if similar articles are not for the time being procurable in the United Kingdom. If duty has been paid on importation, the duty may be repaid under a treasury direction.
So you see, Mr. Speaker, that the law is quite comparable with ours and the provision that is made for customs duty on importation, whether it is at the low rate or at the higher rate, is a matter for decision by the treasury on the recommendation of the board of trade. I have not heard anybody complaining about there not being an effective right of appeal there when both the treasury 90205-6-235J
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and the board of trade are represented by their ministers in the House of Commons and can be called to account at any time.
I turn to page 4 of this interesting publication under the heading "The 'Similarity' Condition".
(a) General.-The similarity of machines for the purposes of compliance with the statutory condition referred to in paragraph 1(b) is judged primarily in relation to the product or effect and the efficiency with which it is produced. The appearance, size, shape, method of producing the given product or effect and the cost of machines are not regarded as relevant. To justify a recommendation for remission of the protective duty, it must be shown that the foreign machine has a definite and marked superiority in performance over any comparable machine procurable in the United Kingdom. Where such superiority cannot be shown to exist in general performance, application for remission of duty may be made on the ground that the machine has a definite and marked superiority in performance for the particular use for which the user requires it, provided that it is to be employed to a very substantial extent on the work for which it has such superiority.
On the same page paragraph 7 deals with application on the grounds of long United Kingdom delivery, and reads as follows:
Applications for remission of duty on grounds of long United Kingdom delivery will be entertained only if the user of the machine submits evidence to show that when he placed the order for the foreign machine:
(a)	no manufacturer in the United Kingdom could deliver a similar machine within two years; and
(b)	where delivery by United Kingdom manufacturers was
(i)	between 24 and 30 months, the foreign delivery was within 15 months; or
(ii)	more than 30 months, the foreign delivery was within one half of the United Kingdom delivery period.
It will be observed that the conditions for qualifying for the application of the lower rate of duty are much more rigid and difficult of compliance under the United Kingdom legislation than they are under the Canadian legislation, and the decisions in these matters rest with the treasury on the recommendation of the board of trade. So much for the allegations that this legislation is of an arbitrary nature.
I was asked at an earlier stage of the session to give some information concerning appeals pending before the tariff board. The total number of appeal cases registered but not heard before the tariff board on the date on which this information was obtained and given to the house, March 8, 1961, was 69, and of these 69 cases I was informed that 20 might have some relationship to the question of class or kind. There were 17 of these 20 cases that were, I am informed, considered as straight class or kind cases, and there were three others in which the tariff classification,

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directly or indirectly, possibly might involve the question of whether the goods were of a class or kind made in Canada.
As to those 20 cases, 17 plus 3, I have this further breakdown. In 18 cases the goods were clearly shelf goods within the definition in the bill now before us. One involved goods that under the bill would clearly be custom made according to specifications, and the other case was one in which, I am told, the goods were probably of a kind that would be ruled to be custom made according to specifications under the present bill.
Then there is a further breakdown with respect to those 20 cases pending at March 8. It is a breakdown on the basis of whether or not they would be affected by the proposed amendments to the Customs Tariff in the present bill. I am advised that of the 20 it is quite clear that 18 would not be affected by the bill. One is clearly a case where the decision of the minister, if made under the bill, would be final with respect to the point under appeal, and with respect to the other one of the 20 cases the status was doubtful.
Let me offer a further observation concerning the volume of these appeals. In the calendar year 1960 there were 39 decisions by the tariff board on appeals. Of those 39, 28 related to decisions with respect to class or kind. Of these, only two involved goods that would be interpreted under the present bill as custom made according to specifications. The explanation for the unusually large number of class or kind decisions in 1960 is that from May, 1954 until the Supreme Court of Canada gave its decision in the power shovels case on October 7, 1958 the board virtually ceased hearing appeals involving class or kind questions pending the judgment of the higher courts. It was hoped that the courts or parliament would provide proper criteria, a proper interpretation that would assist the tariff board in future cases of the same kind. But, Mr. Speaker, no assistance was received in this regard from the decisions of the courts and it is needful, therefore, that parliament now supply what is lacking, and what is so obviously lacking, in the way of definition and restoration.
In almost all "class or kind" appeals the issue for decision has involved the question of whether the imported goods were or were not of the same class or kind as the Canadian goods; that is to say, the issue of what were the appropriate limits of the expression "class or kind". There have been very few cases where, having determined the appropriate limit of the term "class or kind", the issue turned on whether the Canadian production constituted more or less than 10 per cent of consumption. One such case, and the only one I have been able to discover in which
the issue comes out clearly in the published decision, relates to certain truck cranes, decision No. A-471, dated June 22, 1960.
In this particular case the board accepted, with some publicly expressed misgivings, and used confidential information submitted to it by the department. The board also obtained certain confidential information itself. The board found its own efforts to compile data on consumption difficult, time consuming and not satisfactory. I have the following quotation, Mr. Speaker, from the board's report in this case, and it is informative. I quote:
At the hearing, counsel for the department requested the board to receive certain evidence in confidence under the terms of subsection 10 of section 5 of the Tariff Board Act. Counsel for the appellant objected to this procedure. After hearing argument from all counsel and assuring itself that the information was indeed "in its nature confidential", the board received the evidence in confidence.
While the board is empowered to receive information that is in its nature confidential it is very much aware of the dangers and difficulties that may be associated with the practice of receiving evidence in confidence.
Accordingly, it would hope that in the future counsel would reach an agreement, as they have been able to do in the past, that would enable the board to come to a decision on the basis of evidence that is not confidential.


Mr. Benidickson:: Just for the information of hon. members, would the minister indicate either the names of the parties concerned or the nature of the product over which the dispute took place?


Donald Methuen Fleming: I indicated that the nature of the product was truck cranes.
It will be quite clearly apprehended by the house, Mr. Speaker, from that quotation that the board has itself recognized the difficulties that confronted it in making a determination based upon confidential information. This is the type of difficulty that the present bill is intended to overcome. It will obviously be of assistance to the board in that regard.
The real cause of this difficulty that is mentioned, apart from the problem of obtaining information that is available only in confidence, is the non-existence of appropriate official statistics. Reference has been made to this subject earlier, Mr. Speaker. I simply comment briefly on it now by saying that in most cases the dominion bureau of statistics returns do not give a breakdown in sufficient detail to make available the information required for the establishment of the "normal Canadian consumption". The latter figure is obtained by adding imports to the Canadian production and reducing this total by the exports.
I was asked a question concerning this matter of erosion. Here I should like to give the house the benefit of some study that has

been devoted to that question. I reaffirm that the words "class or kind", as I have said in earlier stages, were intended to be given a reasonably broad interpretation; that in fact they were consistently interpreted broadly until 1950; that during the period since 1950 former departmental interpretations have been narrowed considerably as a result of certain tariff board declarations, and that the effect has been to erode to some extent the protection afforded Canadian producers.
Reference has been made to certain tariff board cases. In his speech on February 20, the hon. member for Kenora-Rainy River quoted extensively from two tariff board declarations relating to power shovels. These were dated April 18, 1953 and May 20, 1954 respectively. He drew from them the comforting conclusion that there has been no erosion or narrowing of the class or kind concept.
I regret that I must profoundly disagree with the hon. member. I say instead that these two cases really demonstrate that the class or kind concept had not been narrowed to the same extent in 1953 or 1954 as it has more recently. This may be illustrated by reference to the 1960 case, appeal No. 450, to which he referred later in his speech.
In this connection it is of interest to compare the issues which were at stake in 1953 and 1954 with those which were at stake in 1960. The issue presented to the tariff board for decision in 1953 was whether all power shovels, without regard to size, should be treated as a single class or kind, or whether it was proper for the Department of National Revenue to apply the range principle and to rule separately in respect of a certain range of sizes of shovels. The effect of the 1953 declaration was to endorse the "range" principle, under which the department had ruled that a certain range of shovels, as measured by dipper capacity, were made in Canada and that sizes outside this range were "not made". This decision was without prejudice to what constituted the proper range of sizes.
The second power shovel case, that is appeal No. 306, on which the tariff board declaration is dated May 20, 1954, had the effect of confining the limits of the range of sizes deemed to be of a class or kind made in Canada. In this case the tariff board decided that it was not legitimate to include in the range of sizes deemed to be "made in Canada" any competitive products of sizes larger or smaller than the largest or smallest sizes actually made in Canada. Thus this 1954 decision maintained the range principle, but at the same time cast doubt upon a number of earlier departmental rulings declaring broad classes of goods to be made in Canada without
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reference to the question of whether the particular sizes under review were or were not within the range of sizes being made in Canada.
I shall refer later to some of these rulings, and to early tariff board cases confirming them. The point which I make now is that the declaration in appeal No. 306 upheld the "range" principle, but that this same principle was undermined by some later decisions. One such case is the only recent case which was referred to by the hon. member for Kenora-Rainy River in his speech. It is the declaration dated September 12, 1960 on appeal No. 450. This relates to a tilting pan filter which had been imported on November 15, 1956. Here the range principle was not even mentioned in the decision, and the case turned on whether the differences which existed between the particular imported filter under consideration and competing Canadian filters were or were not sufficient to set the imported filter apart as being of a different class or kind from those made in Canada.
The board, in effect, decided that this particular filter did constitute a different class or kind. The inference is that under the existing language of the Customs Tariff imported goods must be virtually identical with the competing Canadian goods or the special rate of duty applicable to "goods of a class or kind not made in Canada" will be applied.
Opinions may differ as to whether the board was right or wrong in this 1960 decision having regard to the language of the statute under which it had to make its decision. However, I submit that this decision to which the hon. member referred, as well as a number of other decisions to which I referred on a previous occasion, represent a serious narrowing of the class or kind concept from that which was intended and which was still being applied at the time that present GATT commitments were entered into in 1947.
The hon. member for Bonavista-Twillin-gate at one stage remarked that he would wish to be satisfied by concrete illustrations of what the erosion actually amounted to. I do not know whether it is too much to hope for, but I shall endeavour and continue to endeavour to satisfy him. I have reviewed the tariff board declarations relating to the class or kind cases which are on file in the Department of Finance. This review has confirmed that a substantial amount of erosion has occurred to date, and that there exists a serious danger of still further erosion in the future if remedial action is not taken such as that which is proposed in the bill under debate.
Three class or kind appeals which were heard by the board in the years 1933 and

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1934 illustrate the original concept. In each instance the tariff board upheld a departmental ruling applying a broad construction to the words "class or kind". I shall deal with these three cases in turn.
The first is appeal No. 4, concerning dolls, the declaration being dated August 18, 1933. This was the first appeal case on which the tariff board made a declaration, the first three appeals having been withdrawn. The question before the board was whether celluloid dolls which admittedly were not made in Canada were of the same "class or kind" as composition dolls, which latter were made in Canada. The tariff board sustained the department's ruling that the two kinds of dolls should be considered together and that accordingly both celluloid and composition dolls were of a class or kind made in Canada.
The second of these appeals is No. 7 concerning pocket lighters, the declaration being dated July 13, 1933. The question in this case was whether an imported pocket lighter of cheap construction was of a class or kind made in Canada. The circumstances were that no cheap lighters were made in Canada, but that more expensive and better fabricated Ronson lighters were made in Canada. The board upheld the department's ruling that both lighters were of the same class or kind.
The third of these appeals is No. 34 concerning rubber combs, and the declaration is dated March 1, 1934. The tariff board in this case dismissed an appeal from a ruling of the Department of National Revenue that hard rubber combs were of a class or kind made in Canada. The circumstances were that celluloid combs were made in Canada; hard rubber combs were not. The department ruled that both types were of the same class or kind, and the tariff board upheld that decision.


Mr. Pickersgill:: That is what the election of 1935 was about.


Donald Methuen Fleming: During the war years and the first five years following the war the tariff board was largely inactive and very few appeals were taken to it on any subject. From 1939 to 1949 inclusive there does not appear to have been a case which is significant for our present purpose. However, for the sake of completeness I should mention that in a declaration dated December 30, 1941, in appeal No. 131, the board upheld a departmental ruling that red kidney beans were of a class or kind produced in Canada.
The next case which is relevant and the case which to my mind represents the real beginning of the process of erosion to which I have referred, is appeal No. 206, on which

the tariff board declaration is dated March 16, 1950. This was an appeal from a departmental ruling that Mossberg .22 calibre rifles, models 151M and 152 were of a class or kind made in Canada, and hence not eligible for admission under tariff item 441e. The rifles in question were of the auto-loading type. Another type of .22 repeating rifle was being made in Canada by the H. W. Cooey Machine and Arms Company Ltd. of Cobourg. The question at issue was whether or not the imported auto-loading rifles in question should be considered as of the same class or kind as the Canadian made repeating rifles of the same calibre. The board allowed the appeal from the decision of the department, thus narrowing the broad construction which the department had previously given to the phrase "class or kind". The relevant portion of the board's decision reads as follows:
Dictionary definitions of the word class indicate that it is used both in very broad and for very narrow designations, but in the context in which it is used in tariff item 441e it appears to be more or less synonymous with "kind". Consequently, in interpreting this item the board has taken cognizance of the more precise designation "kind". Autoloading rifles are of a kind not made in Canada. Accordingly the appeal is allowed.
The success of the appellants in this appeal No. 206 was, as might have been expected, followed by a good many other appeals by importers or their foreign suppliers seeking to narrow the interpretation of the expression "class or kind". As I have already said, they have met with a considerable degree of success during the years from 1950 to 1960 inclusive. I shall not attempt to review all these cases in detail, and I do not wish to suggest that all of them involved uninterrupted progress in the process of erosion. As one might expect, the process was not uniform and continuous. The trend, however, is unmistakable. I suggest that any hon. members who wish to pursue the matter further and to evaluate for themselves both the general trend and the cross currents might consult the declarations of the tariff board in the following cases:
Appeal No. 246-fork lift trucks-November 5, 1951.
Appeal No. 246-fork lift trucks (supplementary) -May 29, 1952.
Appeal No. 272-power cranes and shovels-March 18, 1953.
Appeal No. 286-fork lift trucks-May 20, 1953.
Appeal No. 285-Snyder car wheel boring machine -June 15, 1953.
Appeal No. 292-fire brick-November 4, 1953.
Appeal No. 306-power shovels-May 20, 1954.
Appeal No. 317-42 ft. boring mill-July 5, 1954.
Appeal No. 501-newsprint rewinding machine- April 30, 1959.


William Moore Benidickson: Will the minister repeat the number of that appeal?


Donald Methuen Fleming: The last one?


William Moore Benidickson: Yes.


Donald Methuen Fleming: It is appeal No. 501 -newsprint rewinding machine, April 30, 1959; appeal No. 455-newsprint machine- April 30, 1959.


William Moore Benidickson: Was not the law changed before that appeal was disposed of?


Donald Methuen Fleming: I beg the hon. member's pardon?


William Moore Benidickson: Did not the Customs Tariff amendments of 1959 alter the law before that appeal was disposed of.


Donald Methuen Fleming: These decisions, if the hon. member cares to refer to them, will be found to be illustrations of what I have been saying with regard to this unmistakable trend of erosion.
Appeal No. 365-transit concrete mixers-October 26, 1959.
Appeals Nos. 307, 413, 429, 431 and others-June 22, 1960.
Appeal No. 383-ball bearings-June 28, 1960.
Appeal No. 450-Eimco pan filter-September 12, 1960.
Appeal No. 517-rolling mill machinery

November 25, 1960.
I have already given the committee details regarding a number of these cases and I shall not repeat what I said earlier. However, in closing I should like to add a word about the most recent declaration in the list, which is dated November 25, 1960. This case will, I think, illustrate as well as any the trend to which I have referred.
This was not an appeal by an importer from a decision of the Department of National Revenue. Rather it was a request by the deputy minister of national revenue for the board's opinion regarding the "class or kind" status of two pieces of rolling mill machinery. One of these was a combination bloom and plate mill and the other was a vertical edger. Traditionally the department had ruled all such rolling mill machinery to be "made in Canada". However, it was recognized that this traditional practice was open to challenge in the light of a number of recent tariff board decisions which had tended to narrow the interpretation of "class or kind". Accordingly, the deputy minister of national revenue referred the case to the tariff board with the following comment:
"Machinery for rolling iron or steel has consistently been ruled to be dutiable under tariff item 427, as of a class or kind made in Canada. The importer claims entry of the above equipment under tariff item 427a, as machinery of a class or kind not made in Canada."
In its declaration which, as I have said, is dated November 25, 1960, the tariff board noted that both bloom mills and plate mills
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are made in Canada, and that at least one combination mill, although of smaller size, had been made in Canada. However, it found that the particular Blaw-Knox combination mill in question differed in a number of respects from any rolling mill which had been made in Canada as of that date. While there was no suggestion that the mill in question could not be built in Canada, the fact was that no identical or virtually identical mill had been made here. Accordingly, the imported mill in question was declared to be of a class or kind not made in Canada. This declaration, which, as I have said, is the most recent declaration available on a "class or kind" case, provides a further example of the erosion to which I have referred. Its effect was to admit under tariff item 427a at a reduced rate of duty a rolling mill which under the traditional departmental practice followed prior to the decade of erosion would have been classified under tariff item 427 as part of the broad category "machinery for rolling iron or steel" and probably would have been so considered even far into the period of that decade before the process of erosion had run the full course it has now done.
I shall not detain the house further in moving the second reading of this bill. This is a bill which in my respectful submission is urgently needed to bring some assistance to the tariff board in the nightmare in which it has found itself as a result of the course of decisions, and to supply what parliament ought in any circumstances to supply in connection with legislation of this kind, namely a clear definition.
In addition to supplying that clear definition-a positive definition for the first time- this bill will also bring about one other necessary result, and that is the restoration of the legislation to the effect that it was always understood to have prior to what I have called the decade of erosion. Here is a situation in which Canadian workmen have been deprived over the years, and particularly in these latter years, of the benefit of legislation which parliament certainly intended for them and which they enjoyed from the time that this legislation first became effective in 1907 in Mr. Fielding's tariff of that year right down to these recent years. Surely it is their right to have the benefit of that legislation restored to them, particularly when the jobs of Canadians are at stake in the issue.
Mr. W. M. Benidickson (Kenora-Rainy
River): In making some further comments in connection with this tariff legislation, now that we have it before us in the form of Bill No. C-72, I wish to point out that when the minister introduced the bill he just said we have it in precisely the same language as in

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the resolution. I am afraid that this is what is going to be disappointing to the opposition.
While, as the hon. gentleman said, we had a considerable debate in the committee of ways and means at the resolution stage we are faced now with the exact wording which was so objectionable not only to the opposition but to many elements of the country at large. The Minister of Finance (Mr. Fleming) said he hoped there would not be a great deal of repetition at this stage of the debate. Unfortunately, he has again followed the procedure which was so noticeable during the resolution stage when he simply made assertions rather than gave facts or sought to prove arguments which were challenged during the course of that debate.
The minister even brings up the classical case of the dipper shovel. I might remind hon. members that I took considerable time, on February 15, I think it was, to indicate that in connection with that shovel case it had been established that there was nobody in Canada who was capable of producing this cubic yard machine at the time of the appeal. I read from the Montreal Star in support of this assertion, and, indeed, pointed out that five years after this appeal there was a great celebration when a company in Canada after five years of research and the expenditure of a million dollars found it possible to produce a shovel of this particular kind.


Mr. Broome:: To what company is the hon. member referring?


William Moore Benidickson: I think it was the Dominion Engineering Company. Anyway, I did give the details at that time. The premier of Quebec was present. That was five years after the appeal and it was stated that it had taken that length of time before such a shovel could be produced in Canada.


Mr. Montgomery:: I have a little machine shop and I could have produced one myself.


William Moore Benidickson: The hon. member for Victoria-Carleton suggests he has a little machine shop capable of doing the work. I think perhaps he had better visit the Dominion Engineering Company who found it took them five years and the expenditure of a million dollars before they could equal the big shovel which was the subject of the appeal in 1953 and 1954.
But despite the nature of the discussion which took place on this case, among other things, at the earlier stage, the minister refers to the shovel again and appeals for an absence of repetition in this debate. The hon. gentleman has referred to a number of other cases with which, of course, I do not intend to deal in detail now. But the fact that he once again

simply makes a broad assertion without to my mind establishing any proof of his contention that there has been erosion with respect to a dozen or more cases since 1950, does, in itself, simply invite a very long debate.
I do, however, have some information at hand with respect to the case which, I think in the words of the minister, was the classic or basic case which in his view started the erosion over the past decade. He referred to the automatic .22 rifle case of 1950. Here again we are being invited to repeat ourselves because the minister made no reference whatsoever in his presentation to the house this afternoon to the practice which I outlined during the previous stage of the debate, namely the opportunity that goes to the department itself to make what are called "made in Canada" rulings.
In connection with the .22 rifles' case, the Department of National Revenue had on its books what I think at that time was the last ruling with respect to .22 rifles, a ruling dated 1939. That makes clear a policy of that department which did not accept a range of interpretation because the department was bound by the law of parliament. The law of parliament said that there must be actual production in Canada equal to 10 per cent of Canadian consumption of the particular kind of article that was being imported and being assessed for duty. According to my information it was not until the very day that the appeal was launched in connection with the .22 rifles' case that the Department of National Revenue decided to change its 1939 rulings. I think that new ruling is dated March 16, 1950. This subject could, however, be dealt with in some detail at a subsequent stage of the debate.
The minister again today advances his adherence to GATT. I propose to have something further to say about that this afternoon.
The minister also again refers to appeals, and I propose to have something to say about that in proper sequence later this afternoon, because I think perhaps the public of Canada is more aroused about the taking of this arbitrary power

instead of it being subject to the law of the land and the course of that law-and placing it in the hands of one single minister.
It is sometimes suggested, Mr. Speaker, that there is no consequential difference any more between the party that sits to your right and the party which sits to your left with respect to the administration of tariffs. I think this particular legislation and the legislation that was introduced in 1958, which

again gave very fantastic power to an individual minister, indicate very clearly the traditional difference in tariff administration between the political parties of this country. It is not just coincidence that every time a change of government has occurred during the last 40 years we have found one government reversing the policy of the other an example of which we have here, an instance involving the abolishment of appeals from ministerial decision. This happened in 1921 when we had legislation introduced by Mr. Meighen. It was repealed immediately by the Mackenzie King administration which came into office in 1921. In 1930 the King administration introduced sections 427 and 427(a), regarding the machinery items which the Minister of Finance indicates to us are the most important items which are involved in the legislation that is before us today. In the same year, when the Bennett administration came into office, it cancelled that legislation of the Mackenzie King administration, and when Mackenzie King succeeded Mr. Bennett in 1935 and initiated subsequently the Canadian-United States trade treaty, sections 427 and 427(a) relating to machinery were restored.
We have here, as a result of this proposed legislation, a new Conservative government attempting to erode the meaning, habit and practice with respect to the administration of these items. Notwithstanding what I have said, the minister has said that he is doing no more in this legislation than returning to an historical interpretation and concept. The minister made this assertion in substance today and certainly specifically with the introduction of the supplementary budget on December 20, as reported at page 1013 of Hansard.
I have indicated that this machinery legislation was introduced by Mr. Dunning, who was the minister of finance in the Mackenzie King administration of 1930. The present Minister of Finance, on December 20 in his speech as reported in Hansard at page 1013, had this to say:
The purpose of these items, as stated at the time the most important of them were originally established, was to provide for reduced rates of duty on "machinery or production, not procurable in Canada".
According to my research, it was in 1930 in Mr. Dunning's speech that this phrase "not procurable in Canada" was first used. I want to suggest that is perhaps the origin of this phrase in parliamentary debate.
When Mr. Dunning introduced the items 427 with respect to machinery, he had this to say, as reported in Hansard of May 1, 1930 at
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page 1628 in explanation of why this was a desirable amendment to the Customs Tariff. He said:
All other machinery-including engines and boilers and electrical apparatus-imports of which amount to scores of millions of dollars, and a great part of which is machinery or production, not procurable in Canada, is divided into two classes-* made in Canada and not made in Canada; the former group is slightly increased under the general tariff; the latter is reduced under all tariffs and made free under the British preference. Among the machinery and equipment in this latter class which formerly was dutiable and is now made free under the British preferential tariff, are included:
This machinery item is the biggest item that is involved in the amendments before us.
The Minister of Finance has been making some very positive statements across the country, since the budget was introduced, as to the innocence of this legislation, and I think he must have given this indication to his followers in some private conversations in caucus because very few of them have offered protests, as I would have expected. If this is so innocent why then do we in opposition receive so many protests with respect to it?
The minister in a speech to the Empire Club of Winnipeg on February 10, 1961 had the following to say:
Let me speak now of the measures proposed in the supplementary budget regarding the provisions in the Customs Tariff relating to goods of a "class or kind" made in Canada. I do so because these proposals have been subjected to erroneous interpretation and baseless charges of protectionism.
Well, let us have a look at this matter of "baseless charges of protectionism."


John Whitney Pickersgill: Page the hon. member for Lincoln (Mr. Smith).


William Moore Benidickson: I propose to say something about the February 27th speech of the hon. member for Lincoln. He felt rather gratified that, perhaps in so far as industries in his riding were concerned, there would be increased protection and some considerable benefit to them.
With regard to this assertion, I am not going to use such phrases as the minister himself in very recent times has indulged in, whether they are parliamentary or not, such as, "Hopelessly untrue". "Why can't you tell the truth?" "This is an erroneous version with no resemblance to the truth". "It is a reckless misinterpretation". "That is not true. That is not even half true", and so on. What I am going to do is use the parliamentary phrase that Hansard uses when some surprise is registered in the house at a statement made. At that time Hansard records "Oh, oh". This may not be understood by some readers of Hansard and so I am going to say, "Oh, yeah", or "Tell it to the marines".

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I suggest to you, Mr. Speaker, that, having read these positive assertions by the Minister of Finance, there is indeed a big gap between rhetoric and reality.


Mr. Bell (Carlelon):: And the hon. gentleman is proving it.


William Moore Benidickson: What we are finding here, as I have indicated in reviewing the history of the past 40 years, is this government again nailing its colours to the old Tory mast of Mr. Meighen and Mr. Bennett, and I am going to have something to say about its adherence to the spirit of GATT.
The minister says there is no increase in protection. He has also gone on to say that there is only one organ in the country that is responsible for some flurry in this connection. In Winnipeg in February he blamed this so-called bogey on the Winnipeg Free Press. Let us have a look at some recent thoughts of the minister himself with respect to these tariff changes. In 1959, when he introduced his budget, he said, as reported at page 2423 of Hansard:
I have been giving thought to various representations that have been made to the government regarding a very important concept which runs through our Customs Tariff: the concept that the protection afforded to goods which are ruled by the Department of National Revenue or the courts to be of a "class or kind" made in Canada should receive greater protection than similar goods of a "class or kind" not made in Canada. This differentiation, based on "class or kind", is to be found in many individual tariff items and also in our antidumping and countervailing duties.
Some of the representations have suggested legislation which would define or re-deflne the words "class or kind" in such a way as to enlarge the range of goods that are now deemed to be made in this country and thus given the greater protection. It is questionable, however, whether an overriding measure, involving a departure from present practices and present interpretations, is in the national interest.
Two years later however he is doing exactly that, and in 1959 he gave no hint that he had any conception that the "practices and interpretations" were in any way eroding the intent of parliament.
I noted this afternoon when the minister spoke that two out of three of the important cases he cited as indicative of the law prior to this erosion were decisions from the tariff board during the regime of the former Conservative government under R. B. Bennett. Perhaps there might later be some erosion with respect to the practices of the tariff board during the Bennett regime to which two out of three of these cases he cited relate, and I propose to deal with the third one on another occasion. This seems to differ very radically from the stand taken by the Minister of National Revenue in the debate on a previous stage of this debate. At that time the Minister of National Revenue did

not suggest that we must find a remedy for erosion relating to the tariff board practices under Mr. R. B. Bennett. What the Minister of National Revenue had to say to us and presumably particularly to the members of the Conservative party who represent ridings that know it is not in their interests to fight tariffs, was: "Don't be alarmed; we are simply making sure that the type of tariff administration as practised under Mackenzie King is not going to remain eroded." I found this afternoon that two of the three cases were heard in the 1930's when the Bennett administration was in power.
The minister says no tariff increase is involved. I think it would be appropriate to show what some independent thinkers have to say. The minister and I had some discussion at the previous stage when he said, "Oh, you are just carrying on the harangue of the Winnipeg Free Press". I indicated at that time that I would be very pleased to quote at the appropriate time not the Winnipeg Free Press but its opposition in the city of Winnipeg, the Winnipeg Tribune, and I do so now. The exchange between the minister and myself took place on February 15, as reported at page 2086 of Hansard. The extract from the Tribune reads in part as follows:
Class or kind-
The proposed "class or kind" changes In the tariff are running into stiff opposition in the House of Commons-and so they should. The changes are objectionable on two main scores: first, they are clearly protectionist and designed to restrict trade; second, the amendments, if approved in their present form, would give the minister authority to make arbitrary decisions against which there could be no appeal.
The proposed changes would virtually destroy the individual's right of appeal. The minister's decision on custom made goods-a term covering a large volume of imports-would be final. In practice this would mean that a customs officer would make rulings which could not be challenged in the courts or before an appeal board.
The Winnipeg Tribune went on to say that the federal government has taken some pride in the fact that in 1960 its exports have expanded. They point out that those exports expanded while the former law was prevailing, and the Tribune reminds the administration that trade is a two-way street, and it says that if Canada imposes restrictions, even hidden restrictions such as involved here, other countries will reply in kind and Canada will be the loser.
There are people other than the Free Press and hon. members of the opposition who sense in this legislation a very important hike in protectionism, and an unknown hike because it is to be operated in the office of the minister and in large part without appeal. The Globe and Mail of March 13, 1961 -and this newspaper is published in the

midst of the Ontario manufacturing industry -had this to say respecting this Customs Tariff amendment:
This amendment would deprive importers of their right of appeal, in these cases, to either the courts or the tariff board. It is impossible to see any justification for this. The questions to be decided are matters of fact, whether, for example, Canadian industry can really produce a particular article in a reasonable period of time. Issues of this kind are properly settled not by a harassed cabinet minister-[DOT]
Like the Minister of National Revenue (Mr. Nowlan).


Mr. Pearson:: Is that part of the editorial?


William Moore Benidickson: No. I continue:
-but by an impartial tribunal which has heard both sides. In the course of the debate on the amendment in the House of Commons earlier this month, opposition speakers also pointed out that it infringed parliament's control over taxation and trade. In effect it gives the Minister of National Revenue power to increase tariffs without the consent of parliament.
Other important journals have expressed a similar view, one of which is the Financial Post, and I may say that I am not speaking today from the point of view of my western background.


Ernest James Broome: Western? How far west?


William Moore Benidickson: My present residence is reasonably west, being west of the lakehead, but I was born and raised on the prairies and I have a great affection for that part of Canada. The Financial Post had this to say in an editorial:
The switch from administrative or departmental decisions, which can be appealed, to ministerial decisions, which cannot, opens the way to all sorts of undesirable developments. If, when ruling on such a customs case, the revenue minister accepted regularly, without question, the advice and decisions of his civil servants, we would get government by bureaucracy.
That is the kind of thing about which we used to hear when my hon. friends opposite were sitting on this side of the house. The editorial goes on to say:
If one minister after another did throw in his two cents worth, we would very likely get inconsistencies and capriciousness in a very complicated, very sensitive area. Finally, ministerial decision which cannot be appealed makes possible government behind the public's back, changes in tariffs without changes in tariff legislation.
Long before the legislation was introduced a good journalistic friend of the present government who represents another eastern newspaper in the press gallery, the Montreal Gazette, a newspaper generally recognized for its Conservative adherence, had something to say about this matter. I refer to Arthur Blakely who, having read the speech from the throne, had this to say:
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Large sections of Canadian industry, which have been pressing the government hard this past year for additional tariff protection, are persuaded that these sentences in the throne speech were designed as an answer to their prayers.
The Montreal Star made this comment in an editorial on December 28, 1960:
Much, of course, will depend on the way in which the new powers are used, but it seems fairly definite that the government has embarked on an openly protectionist course.
I say, Mr. Speaker, that not only does this legislation involve opportunities, such as we know were taken advantage of in the thirties by the Bennett administration, for the ministerial hiking of effective tariff rates to mountainous levels but these rates can be set in a cunning, clandestine and cabalistic manner. In addition, members of this ministry in their explanation throughout the country of what is involved in this legislation have brought about as usual a great confusion and conflict. I have quoted what the Minister of Finance said in Winnipeg. I find that the Minister of Agriculture (Mr. Hamilton) told his constituents that the activities of the government involved no increase in protection. He made the same assertion in that western area of Canada as did the Minister of Finance on February 10.
It is typical of the double-talk we get from the members of the ministry that at about the same time the Minister of Trade and Commerce (Mr. Hees) addressed the Canadian Manufacturers' Association and had this to say, as found in the Globe and Mail of February 8:
Mr. Hees said yesterday that the class or kind legislation which is now before parliament would impose or raise tariffs on foreign goods closely similar to those made in Canada, and should thus increase domestic sales of the Canadian-made product.
The Globe and Mail made this comment in its editorial:
This is simply another way of saying that foreign goods closely similar to those made in Canada are cheaper than those made in Canada.
I have been greatly disappointed at the silence of so many of my colleagues in the House of Commons who, I know, will not find that this legislation is in the interests of their constituencies. The Minister of Finance indicated that the major item here has to do with machinery. When he was asked whether it would not be wise to allow an appeal to the tariff board so that we could be sure that all the facts would be made fully known he said, "Oh, no, the administration is a relatively simple matter". He said that, after all, there were only eight or ten plants involved and that they could check on them through the Department of National

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Revenue without much difficulty. I ask the members of the massive Conservative majority to have a look at this matter. Are they going to approve something that will be primarily for the benefit of eight or ten plants or are they going to have something to say with respect to their own constituencies?
I am not going to single out any western member unless I am asked to do so but I am going to quote from the Alberta Wheat Pool Budget. This is the kind of thing that supporters of the Conservative party are saying in the west when they return to their constituencies.


Hazen Robert Argue: What date?


William Moore Benidickson: November 3, 1960. The
article reads in part as follows:
At a time when there is an increasing clamour for higher tariffs and greater protection for Canadian industry, it is encouraging to hear one of the western Conservative members of parliament speak out forcefully against higher tariffs. Last week in a newspaper interview ... is quoted as saying: "A major battle for higher tariffs on a wide variety of imports into Canada is shaping up"-
This was prior to the speech from the throne on November 17th of course.
-which, if won by those promoting increases, may well put many western grain farmers out of business, cause more suffering in the already ailing Alberta coal industry and, above all, create even higher unemployment at a time when more Canadians are out of jobs than at any time since the second world war at this time of year.
I indicated I was disappointed that this silent and slavish group of back bench members should support this legislation which I submit will not be of any benefit to the vast number of constituencies which they represent and will in fact be harmful. I notice the hon. member for Vancouver South (Mr. Broome) smiling as I proceed with my remarks.


Mr. Thrasher:: Just laughing.


William Moore Benidickson: He may be laughing at me but I am going to have a little laugh at him right now. I am going to suggest something to him and to all the other members of the Conservative party from British Columbia who have been silent on this matter. I say to them that it has been quite a spectacle to find that the Vancouver board of trade, the British Columbia Electric Company, the B.C. loggers' association, the truck loggers' association and a number of other producers' organizations of this kind have had to depend for advocacy so far as this matter is concerned on the C.C.F. member for Vancouver East (Mr. Winch) and the C.C.F. member for Burnaby-Coquitlam (Mr. 
Regier) who are the only ones from British Columbia who have spoken for them on this matter.
Perhaps the people who spoke like that western member have changed their views because they did not know what was likely to happen this session. Apparently the high protectionists, to whom that member referred, have won out and they decided to jettison the policy they had in mind and just continue to follow John. Even some hon. members who think this legislation might be of some benefit to their ridings are in for some striking disappointments. I do not know whether or not their own research is responsible for some of the misconceptions they have or whether these misconceptions result from the blandishments they have received from members of the ministry who say, "This is fine for you; this is going to do a job for your friends".
The hon. member for Lincoln (Mr. Smith) was one of the few who had anything to say in this debate, other than those who have official responsibility for the measure. You will recall that on February 27 he was filled with joy. The thought that the manufacturers of heavy chains, made in his riding, would receive some benefit from the measure. He referred to tire chains for tractors and to another manufacturing plant that is manufacturing automatic transmissions. This bill gave him some heart and some courage. I suppose his feelings have been echoed in the Conservative caucus, and those backbenchers with these hopes evidently outnumbered those who could see danger in this legislation.
Let us look at the situation in so far as heavy chains are concerned. I am informed that heavy chains would be interpreted as shelf goods in accordance with section 2 (a) (2) of the new legislation and therefore would have to be produced to the extent of 10 per cent of the normal Canadian consumption. I am informed that the bill we have before us will not help the manufacturers of tire chains for tractors because these chains enter duty free under item 409n as accessories for tractors. In so far as automatic transmissions are concerned, I am informed that under this legislation there is no help for industrial ridings such as Lincoln because the drawback duty is not payable on automatic transmissions. If the hon. member really wants some help in respect of the manufacturing of automatic transmissions, I am afraid he has to go to tne government he supports and ask that government to cancel the legislation that it brought in by order in council on November 1, 1959. This legislation allows transmissions to enter Canada free. I think disillusionment

will be found in the Tory caucus if hon. members who have presented both points of view there will give this bill further study.
I said it was my intention to say something about the minister's continuous, loud declarations of his adherence to GATT, both in a technical sense and in spirit. We are all very familiar with these resounding declarations of rectitude that constantly flow from the Minister of Finance. Perhaps we should further examine this declaration. On December 20, as reported on page 1014 of Hansard, the minister did actually admit, in mild language, that retaliation against our exports was possible. He tried to persuade us that it was not probable. The minister is not one, in my opinion, who is given to understatement. He is generally prepared to attack a tack with a sledge-hammer. In his speech to the Canadian club at Toronto on January 9, 1961, I think perhaps the minister made, for him, the understatement of 1961. He said:
While this action has aroused the interest of our associates in the GATT, we are confident that it is within its framework.
I suggest to you, Mr. Speaker, and to other members of this house that a great deal more than interest has been aroused by this legislation, especially in so far as our best customers, the United States and the United Kingdom, are concerned. I raised this subject by way of a formal question on the order paper on March 8, and again received a rather bland, evasive, innocent sounding statement from the minister, as reported on page 2774 of Hansard for that date. He said:
-no contracting parties signatory to the general agreement on tariffs and trade. .. have intimated to Canadian government representatives in Canada or abroad that they will expect Canada to negotiate compensatory tariff adjustments or give trade concessions in the event that the Customs Tariff is amended in accordance with the terms outlined in a resolution therefor introduced by the Minister of Finance on December 20, 1960.
This is the brush-off. This is the indication not to look under the rug. The minister went on to say:
There have been discussions, as I think I intimated on an earlier occasion, with both the United Kingdom and the United States governments concerning the significance of the proposed amendment. Some of these discussions actually date back to the time before the terms of the proposed amendment were made known.
The United Kingdom government has intimated that it will be interested in the administration of the proposed amendment, and reserves whatever rights it may possess.
No indication is given in that statement as to the action the United States may take. As I pointed out at a previous stage of the debate, this legislation removes the right of appeal from the board to our courts which, as I read the GATT agreement, is mandatory. In fact, this measure removes in large part
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the type of appeal that had been operative for almost 15 years before GATT and about 13 years after GATT.
The Minister of Finance may think that these people are paying no attention to these administrative alterations in our Customs Tariff which relate to entries involving hundreds of millions of dollars. I am not so sure. I believe this government will get plucked to its pinfeathers as it proceeds with this matter in an age when more liberal trading seems to be the operation of the day for practically every other country with whom we do big business. During the debate in replying to the hon. member for Peterborough (Mr. Pitman) the minister suggested that activities such as are proposed here probably had a great appeal and a great advantage to labour.
In this connection, I should like to read briefly from what the Canadian Labour Congress had to say recently, on January 26, when they made their submission to the Senate manpower committee. I will summarize what they said. They said that if we advance too aggressively in matters such as these our friends, the United States, would retaliate in their trading relations and would knock the stuffing out of us.


Donald Methuen Fleming: Is the hon. member quoting?


William Moore Benidickson: Yes. Does the minister want the page number?


Donald Methuen Fleming: No, I should like the exact quotation.


William Moore Benidickson: I thought perhaps it
would not be in order, but with the minister's consent, I will read it. This statement is reported on page 284 of the proceedings of the Senate committee on manpower and was made during the presentation of the Canadian Labour Congress respecting unemployment.


Donald Methuen Fleming: I thought the hon. member was referring to the presentation made by the Canadian Labour Congress to the cabinet.


William Moore Benidickson: No, I am referring to their presentation with respect to the unemployment situation to the manpower committee of the Senate. They said:
Everybody knows what would happen if we raised the tariff on American goods, which, of course, make up over two thirds of our imports: American retaliation could knock the stuffing out of a variety of Canadian industries.


Donald Methuen Fleming: I think the hon. member will agree they are talking about something quite different there, namely raising the tariff.


John Whitney Pickersgill: That is what you are doing.

Customs Tariff


Donald Methuen Fleming: This is not raising the tariff.


John Whitney Pickersgill: It is raising it from 7i per cent to 22| per cent.


William Moore Benidickson: There is a 15 per cent hike on a substantial portion, as I say, of hundreds of millions of dollars of potential trade particularly between our two big customers, namely the United States and the United Kingdom. As we found previously, it is rather an invidious position to be in in the opposition to find out whose ox is going to be gored in these tariff negotiations. We are obliged to enquire respecting public hearings down in Washington to find out there what GATT proposals Canada has made, and who Canada is selling out for the purpose of giving some benefit to the eight or ten particular industries which I have indicated seem to be at the very core of the advantages involved here.
This happened in 1958. Then the Minister of Finance would not make available to us any information as to what quid pro quo was likely to follow with respect to these partners of ours in GATT that would require compensation. I suggest that we are going to find retaliation here. If we do not find it directly, we are going to find that it is less easy for us in the immediate future to negotiate with these countries on further proposals that might be to our advantage in the matter of the liberalization of trade. The Minister of Finance seems to want to keep this retaliation skeleton in his closet, but it will come out. Unfortunately we will find who has paid for these concessions. We will find that only by going over to Washington where these things are discussed publicly or we shall have to have somebody who visits Geneva tell us, from the negotiations that are still carrying on there under GATT, what the sacrifices in Canada by exporters are likely to be.
Since we discussed some of these matters in the committee of ways and means, a delegation of the ministers of this government went down to Washington. I think my point is fairly conclusively established in this understanding assembly when I quote what the usual vigorously speaking Minister of Finance had to say as to the attitude of the United States while there. If he had completely sold the United States on the idea that this proposal was innocent in so far as our intercountry trade was concerned and in so far as it affected them, we know that he would be the first to make quite a noise about it. But instead of that-and as I say, contrary to his usual style-we find this, and again I quote from a reporter friendly to the minister namely a reporter of the Toronto 
Globe and Mail in Washington. He quotes the Minister of Finance as summing up after the conference as follows:
The Canadian delegation has done all anybody could do to make It clear that redefining of "a class or kind made in Canada" was entirely a proper action for the Canadian government to take.
I think we can all judge what that really meant from the point of view of convincing that conference. I suggest that the real operation resulting from this legislation will be something that the ministry traditionally- or at least it is traditional with them-will tell us nothing about while this debate is on, but that the real battle will take place abroad in Geneva in ensuing days and weeks. There is not any wonder why this would not now take place there. We know that there were protests-and formal protests that time-in 1958 when the Customs Act was amended. Before any legislation was presented and simply on the knowledge that it was likely to be presented, the United States formally wrote our government and indicated their interest. There was no reply. After the legislation of 1958 was introduced they received no reply to a protest. Of course, the government's explanation was that this was correspondence between a junior in the United States embassy and a junior in the Department of External Affairs and that it got overlooked.


Lester Bowles Pearson: Like Eldorado.


William Moore Benidickson: Yes, like Eldorado. It turns out that the Canadian junior happens to be of the status of one of our foreign ambassadors; and it happens that the United States junior who wrote the letter is still the senior man representing the United States in this country in commercial matters.
The Minister of National Revenue is one of those who went down to Washington at this time. I can understand why now there was no need for the United States government to write letters to the Canadian government that are likely to be pigeonholed. As the minister has said the United States people have been in contact with the government and its officials informally. They are simply putting in a caveat, as one might say. They know that the real negotiations in so far as any effect on them is concerned will, as I say, take place on foreign soil and until all is a fait accompli the members of this house will know very little about it. But the Minister of National Revenue was also down in Washington on this visit and I find him quoted as saying, "Oh, there is no discrimination here; this is not aimed at the United States". Of course, there is no discrimination here. It is not aimed at the United States; it is aimed at everybody. The idea is to shut out all trade

partners. But the people affected of course are our two major customers, namely the United Kingdom and the United States.
In addition to that, if he is quoted correctly in Washington on March 13, several weeks and months after the legislation was introduced, the Minister of National Revenue passed the buck to the opposition, as the government has often done. They say that this legislation does not amount to anything, that it is mainly a political football created by the opposition. At a previous stage of this debate I quoted from one if not two of the Canadian journalists stationed in Washington and I quoted from them at a time before the budget was introduced. I quoted from them with respect to the reaction that took place in Washington simply after reading the speech from the throne. The opposition had nothing whatever to do with that. But the headline that was provided in a Washington paper which I quoted previously under the byline of Mr. Tim Creary of the Southam newspapers was a Washington newspaper headline saying Washington was "terribly" upset by what was announced in the speech from the throne.
What the Minister of Finance is simply going to tell us here is that this is just a little matter; that this is not going to affect our trade relations very much; I want to say that this means a great deal more than what many people in the country and perhaps even in the House of Commons appreciate. It is not only the consumer interest that is affected. The interesting thing is that it perhaps affects most keenly the large and small manufacturers or at least it will harm and affect large and small manufacturers in Canada other than those eight or ten who actually make machinery in Canada, to whom I have made reference. Many of these manufacturers all struggling to export in world markets at competitive prices.
The Minister of Trade and Commerce goes out in the country and his standard speech to chambers of commerce is this. He wants to know why industry cannot compete in foreign markets as well as in our own. If these manufacturers are obliged to buy something in Canada that is of lower capacity, of inferior quality, and at a higher price than that at which their competitors in other parts of the world can buy, how do you expect them long to be able to compete with other producers in other parts of the world? What happens here as we all know, is this. Instead of being able to import from the United Kingdom or the United States the most up-to-date efficient machine that up to now has not been made in Canada but which the Minister of National Revenue in a back room is going to say henceforth could be made in
Customs Tariff
Canada, what will happen is that the cost of that tariff capital levy for machinery will go up in the case of a British machine from free to 10 per cent and 22J per cent in the case of a machine from the United States.
Many businessmen will come to the conclusion that it would be business suicide to add this tariff differential to their capital costs particularly if they must wait for lengthy periods before finding out what the tariff rate is going to be; when they have to wait for the Department of National Revenue to make these national calculations statistically. I suggest this is very undesirable legislation. Everybody who knows how the administrative machinery operates knows that this does not really mean what it says; it will not be the minister who deals with these matters. The minister is not going to be able to deal with one hundredth of the applications involved in decisions relating to whether or not an article is made in Canada. The potential manufacturers who are concerned about what it would cost them to set up a plant will find themselves at the mercy of some junior official who may be very biased and limited in his knowledge of what is going on in Canada. I say that if we are abolishing the tariff board and giving power to one minister just because we do not agree with the board's decisions it will be just as logical to say that we should abolish law appeals and allow the Minister of Justice (Mr. Fulton) himself to deal with these vital matters. I think that would be just as logical.
Somebody said that if the Russian ambassador were listening to this debate and reported to Khrushchev that such powers were being taken by the minister here in this democracy Khrushchev might die in a fit of laughter because we hypocritically talk about dictatorial action in some other countries.
I move, seconded by the hon. member for Welland (Mr. McMillan):
That all the words after "that" be struck out and the following substituted therefor:
"this bill be not now read a second time because of new provisions for arbitrary decisions which transfer the tariff making authority from parliament to the Minister of National Revenue, contrary to the principles of responsible government and the essential rights of parliament to tax".


Donald Methuen Fleming: I wish to submit to you, Mr. Speaker, that this amendment is out of order. It purports to be an amendment to a motion for the second reading of a bill. As you well know, sir, the kind of amendment which is in order on a motion for second reading is very limited. According to my memory of the rule it requires an assertion of a contrary principle. In my submission this is not the kind of amendment which qualifies

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within the narrow provisions laid down with regard to amendments to motions for second reading.
It is a clear principle of construction that an amendment cannot be introduced if it merely asserts a negative.
In the next place, it is an equally well established rule that it is not in order to bring forward an amendment simply in order to give a reason. It is in debate that we state the reasons why we take positions for or against certain motions. It seems to me that this amendment on the face of it purports to do nothing more than that. On that account it is clearly out of order. So I think that on three grounds this amendment does not qualify within the narrow rules which have been established governing amendments to motions for the second reading of bills.


John Whitney Pickersgill: I think I can greatly assist Your Honour by bringing to your attention an amendment moved by the Leader of the Opposition (Mr. Pearson) and seconded by the hon. member for Ottawa West (Mr. Mcllraith) on September 2, 1958 which read:
That all the words alter "that" he struck out and the following be substituted therefor:
"that this bill be not now read a second time because of new provisions for arbitrary valuations which transfer the tariff making authority from parliament to the minister and the cabinet contrary to the principles of responsible government and the essential right of parliament to tax."
The only difference in wording between that amendment and the amendment just moved by my hon. friend from Kenora-Rainy River is that the word "decisions" has been substituted for the word "valuations" after the word "arbitrary", and "and the cabinet" has been left out and "of national revenue" substituted. Precisely the same objections were advanced to that amendment by the Minister of Justice (Mr. Fulton), though not in precisely the same language, as have been advanced by the Minister of Finance (Mr. Fleming) to the present proposed amendment.
Mr. Speaker made a ruling on all the points which were raised by the Minister of Finance, which ruling is to be found at page 535 of the Journals for that session. I do not suppose Your Honour would wish me to read them, though I could if desired. The Speaker did rule that the amendment was completely in order and I suggest that as the present amendment is entirely on all fours with the amendment which the Speaker ruled to be in order at that time it is, of course, similarly in order. Incidentally, that earlier amendment was based on an amendment which had been moved by a very experienced parliamentarian, Mr. Stewart, and seconded by Mr. Ian Mackenzie in 1930, and it was not even challenged by the government of that day.


Erhart Regier: Perhaps I may refer briefly to the arguments presented by the minister on the point of order. The hon. gentleman said he had put forward three reasons why the proposed amendment should be ruled out of order. I may have missed one of them, but I recognized only two. The hon. gentleman argued in the first place that the amendment should offer a contrary principle. I should like to call your attention, Mr. Speaker, to the fact that a motion has often been accepted in this house calling for a six months' hoist which, in effect, is the assertion of a contrary principle.
The minister gave as a further reason why this was not in order the fact that it contained in it a reason which, in his opinion, was subject to debate and therefore ought to be included in argumentation and ought not to be the subject of amendment.
I would like to refer Your Honour to a motion that is very fundamental, namely that a bill be now referred to a standing or special committee of this house in order that this or that particular feature of the bill might be more adequately explored before the house gives second reading. We often have motions that include the reasons for putting the motions before the house, and in the light of many similar motions on second reading, in regard to which we have all had experience in this house, I suggest that the other argument put forward by the minister is completely ridiculous. I hope that Your Honour will consider the reasoning put forward by the hon. member for Bonavista-Twillingate (Mr. Pickersgill) and myself in this regard.


Mr. Deputy Speaker:: This amendment
ought to be considered in the light of citation 382 of Beauchesne's fourth edition which reads as follows:
382. It is also competent to a member who desires to place on record any special reasons for not agreeing to the second reading of a bill, to move as an amendment to the question, a resolution declaratory of some principle adverse to, or differing from, the principles, policy, or provisions of the bill, or expressing opinions as to any circumstances connected with its introduction, or prosecution; or otherwise opposed to its progress; or seeking further information in relation to the bill by committees, commissioners, the production of papers or other evidence or the opinion of judges.
I would suggest that the proposed amendment is within these limitations being a declaration, or an opinion contrary to some provision of the bill and, therefore, I would accept the amendment.


Donald Methuen Fleming: Mr. Speaker, may I just say a word or two before you close this matter?
I did not have before me when I was speaking earlier, the reference to the 1958

decision from which the hon. member for Bonavista-Twillingate (Mr. Pickersgill) read. May I draw your attention, however, to the fact that in that case the amendment did propose to assert a contrary principle, and there was a declaration of a contrary principle. At page 537 of the Journals of the House of Commons of Canada of September 2, 1958, we have a ruling of Mr. Speaker of that day.


John Whitney Pickersgill: It was pages 534 and 535.


Donald Methuen Fleming: The Speaker was also referring to a reference at page 538, where the same rule appears.
Mr. Speaker, at page 537 will be found a very good example of the assertions of a contrary principle and declaratory statement. In that situation the amendment to Bill No. C-51, moved by the hon. member for Richelieu-Vercheres (Mr. Cardin) seconded by the hon. member for Levis (Mr. Bourget) read as follows:
"this house reaffirms the adherence of Canada to the spirit and objectives of GATT, which are clearly violated in provisions of this bill."
The mover put this on record as asserting a contrary principle. In my respectful submission, this present amendment does not invite the house to assert a principle. The amendment reads in part as follows:
this bill be not now read a second time because of new provisions for arbitrary decisions-
There is not even a complete sentence here in what follows, and certainly no declaration of principle. This simply purports to state a reason why the bill should not now be read a second time because of certain provisions. With all respect, Mr. Speaker, this is not an assertion of principle and does not contain a declaration such as is found at page 537 of the Journals of the House of Commons of Canada of September 2, 1958. The house is not called upon to go on record as affirming a principle that is contrary to the principle of the bill. This amendment simply asks the house to subscribe to a reason, and the reason does not even contain a statement. The words "because of" simply refer to certain provisions. With great respect, Mr. Speaker, I urge upon you that this is not the kind of provision that is contemplated in the rule respecting the assertion of contrary principles by a declaration.
At page 538 of the same volume in relation to the rules governing amendments to motions for second reading we have this principle stated:
(1) It may be declaratory of some principle adverse to, or differing from the principles, policy, or provisions of the bill.
I suggest with great respect that the amendment must be a declaration of a principle and not merely a reference to a purported reason.
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John Whitney Pickersgill: Mr. Speaker, since you have permitted the minister to intervene in the course of your ruling I assume I may reply to what he has said. May I point out to Your Honour-I think this is all the reply I need make-that in the case of the amendment moved by the Leader of the Opposition (Mr. Pearson) it was exactly analogous and almost identical in wording to this one and Mr. Speaker ruled that amendment in order. In the case of the amendment moved by the hon. member for Richelieu-Vercheres (Mr. Cardin), which the Minister of Finance seeks to suggest would be in order, His Honour ruled it out of order. I suggest the minister has not helped his case very much by this second intervention. I assume, sir, that you will be impressed by the ruling made by His Honour, the Speaker, regarding the amendment moved by the Leader of the Opposition which was, as I say, almost literatim and verbatim the same as the amendment moved by my friend the hon. member for Kenora-Rainy River (Mr. Benidickson).


Mr. Deputy Speaker:: It appears to me that the Minister of Finance (Mr. Fleming) has expressed an objection which goes rather to the form of the amendment than to the substance. If I interpret correctly citation 382 of Beauchesne it would seem to me that this amendment is an opinion expressed in opposition to the bill which has been introduced and that the question of form would not matter. The amendment reads in part as follows:
-because of new provisions for arbitrary decisions which transfer the tariff making authority from parliament to the Minister of National Revenue-
It is my opinion that these words express an opinion contrary to a part of the bill and I see, therefore, no reason to refuse the amendment. I declare it in order.


Hazen Robert Argue: Mr. Speaker, the provisions of this bill were first announced in a statement of the Minister of Finance (Mr. Fleming) in introducing the baby budget on December 20. Since that time this legislation, or the resolution preceding it, has been discussed on a number of occasions, particularly on March 2 when the bill was given first reading. There has been a long delay between first and second readings because the government did not bring it forward. Nevertheless, the fact that almost four months have elapsed since the minister declared to the house and the country that this legislation was to be brought before parliament, and the temper of the debate that has taken place since, indicate to me that this legislation is not only unpopular and unwarranted in the opinion of the opposition

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parties, but indicate, I would suggest, that the government has been rather timid in proceeding with it, and has taken, in a consistent manner, every excuse to duck bringing it forward to have it approved or dealt with long before now.
The motion that has been presented by the hon. member for Kenora-Rainy River (Mr. Benidickson) is that the bill be not now read a second time because of new provisions for arbitrary decision which transfer the tariff making authority from parliament to the Minister of National Revenue (Mr. Nowlan) contrary to the principles of responsible government and the essential rights of parliament to tax.
We in this group agree wholeheartedly with the amendment. In years gone by the present Minister of Finance and the Prime Minister have been very important champions of the rights of parliament. It is strange that, after a few short years in office, they should move in such a wholesale manner to deny the rights of parliament, to deny the jurisdiction of the courts and to place in the hands of the minister widespread, arbitrary powers of tariff making which, as the amendment points out, in fact are the right to tax. This comes from hon. gentlemen who have been so loud in proclaiming their championing of the rights of parliament.
I suggest that this legislation is bad; it is repugnant to the democratic system. It is legislation that is very much out of step with the times. I noticed that the minister took a long time this afternoon to introduce the legislation in his endeavour to defend it. On other occasions he made very short statements. He brushed off opposition criticism rather lightly. But today he took a long time in an effort to try to defend and to make a case for this legislation. In making his statement I noticed that the Minister of Finance did not follow his usual practice. This afternoon the minister seemed very unsure of himself. He was not the bombastic minister that he usually is, claiming that all right is on his side. He was rather timid, cautious and mild-mannered. I suggest this is some indication that the government itself knows that this legislation is unpopular; that it is, in fact, meeting with very widespread disapproval in the country.
This legislation provides for a change in the definition of goods of a "class or kind". It provides for a change in the definition by saying:
In the case of goods other than goods custom made to specifications, goods of approximately the same class or kind are made or produced in Canada.
As the minister has so well pointed out, by changing this definition the government

will broaden the whole range and the whole class of goods to which the higher tariff of 22J per cent instead of 7i per cent will apply.
The minister has made his case on what he really says are misjudgments of the tariff board. He has said that for the past 10 years the tariff board has been incompetent. He has criticized it very widely. He has said that the tariff board today finds itself in a nightmare. I would suggest that the minister has heaped a great deal of criticism on the board and this is a method of rectifying the situation which he claims exists. He is transferring the jurisdiction from the tariff board to the minister. We had understood that the tariff board was to be made more efficient so that it could handle appeals; that the tariff board was to be set up under a two-panel system instead of a one-panel system. It would seem to me that the government is arguing both sides of the case. It is saying it wants to streamline the tariff board procedures, and yet it is taking much of the power and jurisdiction away from the board.
I would suggest that the legislation introduced today is wrong on other counts. It is far reaching in that it gives to the Minister of National Revenue the right to decide on statistics about normal Canadian consumption, and therefore the amount of the 10 per cent, and by this means it removes a large part of the jurisdiction that has heretofore been in the hands of the tariff board.
The minister is also given the power to decide whether goods are custom made to specifications and whether adequate facilities exist in Canada. One wonders how the minister is going to have all this information when the courts, according to the Minister of Finance, are ill equipped and unable to obtain this information. The minister is going to decide whether adequate facilities exist for the economic production of such goods within a reasonable period of time. This is very indefinite phraseology; it is not precise. Large, sweeping, arbitrary powers are placed in the hands of the Minister of National Revenue.
We think that the House of Commons should reject this legislation. We have opposed it on every occasion, at every stage. We intend to continue that opposition. We intend to move amendments at the various stages and procedures of this bill, which will demonstrate again and again our complete opposition to what is being done by this legislation.
This legislation is wrong on every count. It is protectionist legislation; it is arbitrary legislation; it takes powers away from the tariff board; it takes appeals away from the courts. It places in the hands of a minister the right to tax, the right to decide tariffs, the right to decide the 10 per cent quantity.

It takes away from parliament jurisdiction that has been parliament's for a great many years.
In recent years we have been in some difficulty with respect to our balance of payments. Our export-import situation has been rather difficult, but there is at least some evidence that it is improving. I hold in my hand the dominion bureau of statistics daily bulletin which sets forth our experience in 1960 in the trading field. It has this to say:
Canada's trade with other countries reached a new peak in 1960, being valued at $10,891,100,000, according to preliminary figures released today by D.B.S. This was an increase of 2.3 per cent over the 1959 value of $10,649,200,000. Total exports in 1960 were valued at $5,395,300,000, a rise of 5 per cent over the previous record attained in the preceding year, while imports at $5,495,800,000 were fractionally less than in 1959. The import balance, estimated at $100,500,000, was reduced to slightly more than a quarter of last year's total and was the lowest since 1954.
According to these figures, our trade position is improving. According to the statistics, our exports have been going up by a substantial amount over our increase in imports. Does the government feel that this desirable trend should not be continued? This legislation is opposed to this kind of trend. It is likely to reverse or will tend to reverse this kind of improvement in Canada's trade position.
The minister talks about helping industry. I suggest that to provide a general increase in tariffs will not help Canadian industry. It will merely increase the costs of Canadian industries, make it more difficult for them to compete and result in higher and higher unemployment, a higher rate of unemployment than would exist if this legislation were not passed.
When Prime Minister Macmillan was in Canada recently the Prime Minister (Mr. Diefenbaker) discussed with him the attitude of the British government toward a common market. It is clear that the United Kingdom is going into the common market. It is clear that this is a great threat to Canada's export industries. The Prime Minister said he has a clear impression that the United Kingdom will not upset the trading preferences and arrangements that Canada has enjoyed with the United Kingdom in the past. That is hardly a commitment; it is hardly a firm assurance.
I wonder what the attitude of the United Kingdom is with regard to the policy of the Canadian government which we are now considering. At a time when we need good will in the United Kingdom, when we need to protect our markets in that country, this kind of legislation is a challenge to the United Kingdom to discriminate against Canada, to retaliate by equally discriminatory
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measures in view of the fact that we are undertaking this kind of ill-conceived, high tariff program.
The hon. member for Kenora-Rainy River quoted a number of newspapers, organizations and other authorities that are opposed to higher tariffs.


Mr. Depuiy Speaker:: Order. May I indicate to the hon. member my concern about the line of his remarks now because the question is on the amendment and the only subject of the amendment is the provision to transfer authority to the minister from the tariff board. Of course, all problems raised by the bill may be discussed but the hon. member will realize that he will have the opportunity to speak again when the amendment is disposed of. Therefore, for the sake of orderly debate I think it would be the wish of the house and I think it would be preferable that the discussion at this time be limited to the subject matter of the amendment.


Hazen Robert Argue: Mr. Speaker, I do not mind advice and I appreciate the tenor of your remarks. I was not intending to speak at any great length even if you had not risen, but I do want to say that during all the time I have been a member of the house the practice has been that an amendment on second reading does not result in confining the debate following the amendment to the terms of the amendment but rather on second reading a wide, general discussion of the bill is in order whether or not there is an amendment.
I think I have been very much in order although I can appreciate the desire of Your Honour and perhaps of members of the house to confine the discussion at this stage solely to the substance of the amendment. However, I do want to state that in my judgment a wide ranging debate is very much in order on second reading even when an amendment has been moved.


Mr. Nowlan:: On the point of order, Mr. Speaker, I must say that my impression and recollection of the rulings made by the hon. gentlemen who have held the office of Speaker in the past are not in accordance with the theory just put forward by the hon. member for Assiniboia. If he has the right to do as he suggests, we will have two wide ranging debates on the whole subject. Having in mind the purport of the amendment as I recall it, I believe that the rule is as stated by Your Honour a few moments ago, that once an amendment is moved speakers who follow are, generally speaking, confined to the wording and context of the amendment. In the past Mr. Speaker has, of course, allowed reasonable leeway but certainly there

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cannot be two wide ranging debates on two separate motions before the house.


Hazen Robert Argue: Mr. Speaker, I do not think we will gain anything by the minister persisting with this so-called point of order because he is completely wrong. Not only can there be two wide ranging debates but there may be as many as four or five. I can remember that when a certain famous bill was before the house the official opposition of the day used the technique of moving a motion that the question be now put in order that another round of speakers might join in a general debate. Over the years there has been no inclination by Speakers of the House of Commons to try to confine debates to the precise wording and scope of an amendment before the house.


Mr. Depuly Speaker:: May I add this for the benefit of the hon. member. It may be true that sometimes a general debate takes place when an amendment is being considered but that depends on the nature of the amendment itself. Some amendments may provide for the discussion of the whole subject matter of the bill but when the amendment is on a precise point, as in the present instance, I think the discussion on the amendment should be limited to its subject matter, namely, the transfer of the making of decisions from the tariff board to the Minister of National Revenue. That is the subject matter of the amendment. The hon. member may be right as to the scope of the debate in other cases but in the present case I think the debate has to be limited if the rules are to be applied.


Hazen Robert Argue: Mr. Speaker, I submit again that it is in order to have a wide ranging debate even on an amendment such as the one now before the house. I state again that it is not my intention to make a long speech at this time. Apart altogether from your intervention, I had almost concluded my remarks and only have one or two more thoughts to leave with the house.
I was saying that this legislation is unpopular, that it provides for the giving of arbitrary powers to the minister and that it is not in keeping with the history of the Conservative party when they were in opposition. This legislation, which provides for this arbitrary transfer of powers, demonstrates that the Prime Minister has forgotten all about his campaign to protect the rights of parliament. It demonstrates that so far as this legislation is concerned the Prime Minister has abdicated his own responsibility and has surrendered it to the Minister of Finance. The Minister of Finance, the arch-Tory of the

Tory party, has brought forward this legislation as a pay-off to the financial interests that the minister is seeking to assist by means of this legislation.


Mr. Lambert:: That is nonsensical.


Hazen Robert Argue: The Prime Minister's attitude in the past has been to protect the rights of parliament. I have never known him to advocate higher tariffs in the past but apparently he has handed over his jurisdiction in this matter to the Minister of Finance who is now proceeding by this means to bring about a general increase in tariffs without any support that I know of from any major organizations in the country. Organized labour is not supporting a high tariff policy. Organized agriculture is not supporting a high tariff policy. No party in this house with the exception of the Tory party, is in favour of this kind of repugnant high tariff legislation.


Norman Platt Lambert: That is your word for it.


Hazen Robert Argue: I suggest the government is out of step with the kind of trade procedures that are now being followed in the world, and out of step with public opinion in Canada.


John Whitney Pickersgill: If no one has anything to say at this time, I should like to say that it seems most extraordinary to me that, in the face of an amendment of this character when there are 200 representatives in this house who are now supporting the government and the number is dwindling all the time and is likely to continue to decline as rapidly as circumstances permit, we find this sort of Quaker meeting with no one on the government side able to make any observations about this far-reaching amendment.


Norman Platt Lambert: Maybe the amendment is not worth it.


John Whitney Pickersgill: The hon. gentleman says the amendment is not worth it. The hon. gentleman would not have said that if he had been sitting over here supporting his leader when his leader was over here. At that time there was no more ardent verbal champion of the rights of parliament than the right hon. gentleman. There has been the most extraordinary and complete metamorphosis since the right hon. gentleman crossed to the other side of the house. Nothing could better illustrate that metamorphosis than the legislation which is now before us, and particularly that feature of the legislation about which the hon. member for Kenora-Rainly River (Mr. Benidickson) has invited us to express an opinion in this amendment that is now before the house.

The amendment indicates that this legislation is unacceptable and should not be proceeded with because it makes new provisions for arbitrary decisions which transfer the tariff making authority from parliament to the Minister of National Revenue. I underline the word "new" because three years ago, over our objections, other similar provisions were made. Then the amendment goes on to point out that this is contrary to the principles of responsible government and the essential rights of parliament to tax. These principles were always respected by Liberal governments. The very basis of our constitution is that taxes should be imposed not by one of the 265 representatives of the people but by all of them or by a majority of them after due deliberation and debate.
What this government is seeking to do by this legislation is to permit one minister, not even the governor in council, to divide all the categories of goods that are made in Canada or conceivably might be made in Canada, and the conception need only be in the mind of the Minister of National Revenue (Mr. Nowlan). It does not need to be in anyone else's mind. He never has to explain to anyone, no matter how arbitrary, no matter how unjust the decision. As the hon. member for Kenora-Rainy River has pointed out one of his minions could make the decision without even the minister knowing about it. He decides that something or other is custom made to specifications.


George Clyde Nowlan: We do not have minions in the department under this minister.


John Whitney Pickersgill: The minister knows they are exactly the same people in the department, except for a few new recruits, as they were before. No one in this house has more respect for the civil servants than I have. The civil servants are there to do a certain job. The ministers are there to do another job, and parliament is here to do another job. Parliament never intended that a grade 4 clerk should decide what the Customs Tariff of this country should be or what duties people should pay. This, in fact, is what is going to happen under this legislation.


George Clyde Nowlan: Sheer nonsense.


John Whitney Pickersgill: The description of that statement as sheer nonsense does not make it nonsense. It merely indicates that the minister believes it is more effective to make an exclamation like that than to attempt to refute the argument.
This afternoon the Minister of Finance (Mr. Fleming) used an argument that is always used by good tyrants when he said it would be more efficient for the Minister of National Revenue to make certain of these decisions
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than for the tariff board to make them. It does not matter whether it is fair; it does not matter whether it is just; it does not matter whether this is an arbitrary tax imposed upon the people, it is more efficient. The other argument is that it could be done confidentially. In other words, the minister decides in secret on the basis of secret information whether the tax shall be low or high or no tax at all. This is precisely what we are doing over the whole range of goods that may or may not be made in Canada. We are going to let the minister decide and the minister will have the final decision in every case.
It is true that, on a certain limited range of facts, an appeal will be permitted if the minister decides the goods are shelf goods. All the minister needs to do is decide they are custom made, and that finishes it. The fact of the matter is that the minister is being given the very widest possible powers, powers that cannot be challenged anywhere except in the House of Commons. Then, of course, we will be told it is not in the public interest to produce this information. If the information is so secret that the tariff board cannot be trusted to receive it, I can imagine how likely this government is to give it to members- of the House of Commons.
The plain fact is that even supposing the government does want to change the definition of class or kind-there are a lot of objections to that but I do not propose to go into them because it seems to me that, Mr. Speaker, would be transgressing your ruling which I respect-because they are not satisfied that the courts have properly interpreted the law, some other course should have been followed. This all-wise Minister of Finance knows better than the courts. He knows better than the Speaker what the rules of the house should be. He alone has the key to the mind of the late Mr. Fielding. He has told us what Mr. Fielding meant when this legislation was enacted in 1907.


Norman Platt Lambert: Would the hon. gentleman permit a question?


John Whitney Pickersgill: Oh, certainly.


Norman Platt Lambert: Would he inform the house as to whether or not he holds opinions about legislation and expresses them in this house?


John Whitney Pickersgill: Oh, yes, I certainly do hold opinions. However, I have never, in this house, described the decisions of the Supreme Court of Canada as an erosion of the law. Perhaps that is because I am not an eminent barrister like the Minister of Finance. It does seem to me that is an odd way of describing the decisions of the Supreme Court of Canada. That has been done over and over again and was done again today by the minister.

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The hon. gentleman knows so much more about it. How does he propose to get around it? I grant that parliament has a perfect right to change the law if we do not like the interpretation of the law by the Supreme Court of Canada. We are the legislators, but we are the legislators and not the Minister of Finance or the Minister of National Revenue sitting alone in his closet. That is the whole point. If this government were honest and straightforward-I do not mean honest in money matters, but I mean honest and straightforward in putting forward its legislation-


Hazen Robert Argue: When you get the budget, you will talk about honesty in money matters.


John Whitney Pickersgill: The fact that it is bungling and cannot tell the difference between a deficit and surplus does not surprise me. We had an indication of that when hon. members of the government talked about the way in which this country was being overtaxed at a time when the debt was being paid off instead of being accumulated. We are aware of the fact that the minister does not understand these things. We know that very well. We realize that this country is burdened with the most incompetent Minister of Finance it has had within living memory.


George Clyde Nowlan: That statement is even more crazy than the other one.


Mr. Aiken:: I rise on a point of order. The hon. member for Bonavista-Twillingate has allowed himself to be diverted from the subject under discussion by the hon. member for Assiniboia. I think he has now gone completely beyond the subject under discussion.


John Whitney Pickersgill: I am always grateful to the hon. member for Parry Sound-Muskoka (Mr. Aiken) who has helped me out more than once in the house. I am particularly grateful for the last time he did so. I will therefore come back to the point I was making and it was this. On March 31, 1958, the people of Canada did not decide that one or two ministers of the crown should be given the tariff making power. They decided to let the right hon. gentleman who is now the head of his government and his friends carry on the government of Canada; but they did so in large part, in my opinion, because they were told that this was a government that was going to restore the rights of parliament.
I personally confess that I was never impressed with the suggestion that parliament had ever lost any of its rights prior to that time, but I certainly know it has lost some of them since then. It certainly did so in that very summer of 1958. In that very summer of 1958 the first thing they did was to

do what they are trying to make a more thorough job of now, that is to say, to take away from this parliament the tariff making power and to put it in the hands of one single minister who will not be answerable in that regard even to the cabinet, whose decisions may not even be known,-


William Moore Benidickson: There is no obligation to publish.


John Whitney Pickersgill: -and who will be able to make one kind of decision in the case of one applicant and, when there is in fact a similar set of facts, make another kind of decision in the case of another applicant, with no power whatsoever on anyone's part to do anything.


Ernest James Broome: Will the hon. member permit a question?


John Whitney Pickersgill: Yes.


Ernest James Broome: Is the hon. member suggesting that such power should be given to the minister only if he has the advantage of a glass ball in order to communicate with the late Mr. Fielding?


John Whitney Pickersgill: 
[Stage Direction]
AFTER RECESS

The house resumed at 8 p.m.
John Whitney Pickersgill: When we rose at six o'clock I was referring to the fact that one of the principal effects of this bill is to take away from parliament in any effective sense the right to make the tariff, the right to determine the duty which will be paid by a taxpayer with respect to a whole range of goods, while the government arrogates to itself the right to determine in a completely arbitrary fashion whether a particular article is custom made or shelf goods.


Thomas Miller Bell: Was not the former done in 1904, and does the hon. gentleman object to that?


John Whitney Pickersgill: By "the former" I presume the hon. gentleman means that a decision was made by parliament in 1904 that if something was made in Canada-which is, of course, a matter of fact, not a matter of opinion-the duty would be a certain amount, while if something was not made in Canada the duty would be a different amount. That is something which is done by parliament. It is true
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the determination of whether or not something was made or not made in Canada was arrived at by the administration. In the relatively simple industrial conditions of 1907 I do not think those determinations of fact would have required, in many cases, any very expert knowledge. If there is any defence for this bill at all it surely is that the whole distinction between shelf goods and custom made goods is something which no one would have thought of making in 1907. I do assert that if we are to say that in the case of the shelf goods they must actually be made in Canada but that in the case of custom made goods there must merely be a capacity for them to be made in Canada, then at least those questions should be determined publicly and in the open. Parliament should make definitions with regard to them, and then decisions should be reached publicly and in the open instead of secretly and in the minister's office without the right of appeal and in an utterly arbitrary manner.
That is the point which hon. members opposite are either utterly incapable of comprehending or, as I suspect, utterly unwilling to comprehend. The fact is that if the questions of whether goods are custom made or shelf goods is decided before a public tribunal where argument can be heard we could all see whether or not the will of parliament was being carried out. When those decisions are reached in secret, who is to decide? There is no reason why the minister should not say that the most ordinary thing made on an assembly line is a custom made article. That would not be an honest thing to do, but it would be within the power of the minister to do it. I contend that if we are going to make this distinction between custom made and shelf goods, then when a determination is made there should be proper publication of it and of all the reasons for it; there should be a determination before a tribunal and not in secret and in an arbitrary way by the minister.


Thomas Miller Bell: Does the hon. gentleman agree with the distinction in the first instance?


John Whitney Pickersgill: That is totally irrelevant to the amendment and to my argument. When I come to speak on the second reading I shall deal with that question. However, I am endeavouring at the present time to confine myself strictly to the amendment-


Thomas Miller Bell: The hon. member seeks to avoid answering the question.


John Whitney Pickersgill: The hon. gentleman can go on muttering, but I suggest he listen. There are three ways in which I suggest the rights of parliament are being taken away. In the

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first place the arbitrary and secret power to decide whether or not an article is custom made destroys any effective control by parliament over the tariff. In the second place, the arbitrary power to decide whether adequate facilities exist destroys any effective control by parliament or, indeed, anyone else except the minister himself, and, third, the question of what is a reasonable period of time, which is also left to the arbitrary opinion of the minister or one of his officials, also, I suggest, involves an encroachment on the rights of parliament.
Many hon. members will have read in the local newspapers the brief accounts of the budget speech made today by the chancellor of the exchequer in the United Kingdom. They will have seen that the chancellor has asked that he be given the power to raise or lower certain duties there by not more than 10 per cent to meet certain economic problems which may arise in the course of the next year, and that he has also asked to have that power limited strictly to a term ending on August 31, 1962 unless at a subsequent session of parliament it should be renewed. This is precisely the difference between what is and what is not disruptive of parliamentary control. Here, the government of the United Kingdom is seeking, as all governments must at times, certain limited powers to act quickly. But those powers are carefully and clearly defined and a time limit is placed upon them. It will not be beyond the recollection of many hon. gentlemen sitting on the treasury benches how much importance they attached not so many years ago to the matter of a time limit in connection with powers given to the governor in council. I contend that clause 3 of this bill justifies my saying that the power of parliament effectively to determine the tariff is being taken away from parliament.
I said I would deal with one argument which has been advanced from the government benches and I think there is no better way of dealing with the argument raised by the Minister of Finance than to repeat a quotation given a few days ago in this house by my hon. friend from Kenora-Rainy River. If you think, Mr. Speaker, that I am quoting from another debate, then I am, sir, but what I am quoting is from a debate which took place in another session. I am quoting what the Prime Minister said when he was on this side of the house in 1950 and the words could not be more apt than they are:
The attitude that an opposition is something to put up with on occasion is prevalent in some quarters... If the cabinet is to be trusted-
And we are being asked here to trust, not the cabinet, but one minister only-
[Mr. Pickersgill.l
-and if we are to accept at face value what ministers say, we had better all be absent from this house.
That is really what we are talking about. We are saying that if the taxing power, the determination of the rights of taxation, and the mode of taxation are to be taken away from this house and vested in one minister of the crown without appeal and without publicity, in secret, then indeed we had better not be here.


Mr. Bell (Carleton):: That was done by Laurier and Fielding.


An hon. Member:: Get up and tell us about it.


Gordon Harvey Aiken: Mr. Speaker, I must say a few words on this amendment before the vote is put. It is a very strange amendment coming from the hon. member for Bonavista-Twillingate (Mr. Pickersgill) who was a member of a government which, time after time, brought in the type of legislation about which he is now complaining. I do not know what particular passage he was quoting from a few minutes ago in using the words of the Right Hon. Prime Minister (Mr. Diefenbaker) but undoubtedly it was something very similar to the proposal now before us.
I have to admit that the words of subclause 3 of clause 2(a) have troubled me since I first read them, because undue delegation of authority to the executive and the removal of the right of appeal are two principles to which I am opposed. Under the previous government they were used constantly until they almost became commonplace. So far as I know this is the first piece of legislation that this government has introduced in nearly four years in office which contains a provision of this type, in which the minister's decision is final. I feel, therefore, that we have to look at this clause very carefully before passing judgment on it.
Quite a number of matters in this bill will require interpretation. I would like to list them as they appear to me and then examine which of these provisions will require the interpretation of the minister and which of them will require the interpretation of the courts. The first provision that will have to be decided is, what are goods other than goods custom made? The second matter is, how shall the word "approximately" be applied to a given situation? The third is, what is the definition of the words "class or kind"? The fourth is, what is the definition of the words "made or produced in Canada"? The fifth matter is, do adequate facilities exist in Canada for the economic

production of such goods, within a reasonable period of time? The sixth matter involves the interpretation of subclause 2 of the legislation. The seventh matter is, [DOT]yvhat is the normal Canadian consumption, and the final matter involves an interpretation of subsection 9 of section 6 of the act, as amended by this bill.
I have set forth eight matters in which, it seems to me, a decision must be arrived at for the administration of the bill. Of these eight matters, three are commended to the decision of the minister, and five are left to the courts' interpretation. I realize that we cannot make a decision in respect of the balance of probabilities or because of majority alone. I do want to point out that this is not a case where the act is passed and committed thereupon immediately to the sole discretion of the minister. In certain matters his discretion is final, but in the majority of matters that is not so.
Furthermore, this is an isolated piece of legislation designed to meet a particular need and does not indicate, in my belief, any trend. The minister has carefully and adequately explained the special circumstances under which the three items are committed to the sole decision of the Minister of National Revenue. I accept that explanation and feel that in this particular instance it is sufficient. I must say, however, that if such a trend were to appear in the legislation introduced by this government, or any government, it would cause one to be concerned and, if such legislation became commonplace, I would have to take a much stronger stand. However, I am not going to stand out in the lobby when the vote is taken on this amendment. I am going to vote against it because I do not feel that a sufficient case has been made out against the legislation introduced by the minister.
Hon. members opposite may say I am in an anomalous position in that I am speaking generalities in one case and specifics in another. I would like to point out to them that this is the very situation they are in. They have been talking today in grandiose terms against protective tariffs in generalities. They say they are against protective tariffs and against this type of legislation in general terms but when we come to specific items such as automobiles, textiles, fruit and vegetables and plywood, time and again hon. members in the opposition have risen to ask what the government intends to do to protect these industries. When the government makes some announcement of a policy to assist these various industries, and there have been several such announcements, opposition members are particularly in accord.
90205-6-236
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I mentioned particularly the fruit and vegetable industry, and I would suggest that if it were not for certain protection given to the fruit farmers they would in certain parts of British Columbia and Ontario have had a very difficult year. As a matter of fact I understand they have had a reasonably good year.
I point out these matters because, as a matter of interest, it is easy for an individual to say in general that he is against something but when dealing with specifics the same individuals are for them. I think the opposition members must also take note of the position and stand they have taken regarding this bill. They state that they are against protecting Canadian producers and manufacturers but when specific items come before us, they say they are for them, in spite of being against them in general.
I have outlined the position as I see it and I suggest that all hon. members of this house must be honest with themselves when speaking on this particular bill.
(Translation ):


Jean-Paul Deschatelets: Mr. Speaker, this bill is designed to amend sections 2 to 6 of the Customs Tariff with regard to goods of a class or kind made in Canada.
If we look closely at it we note that it is unquestionably a bill that will lead directly to protectionist measures.
I refer the house in particular to subsection (3) of section 2A. It is clearly stated there that the minister's decision will be final.
Therefore, I suggest that the purpose of this bill is to abolish the essential rights of parliament, as well as the powers of the tariff board, and to confer absolute and arbitrary power upon the Minister of National Revenue (Mr. Nowlan).
I read the statement made by the Minister of Finance (Mr. Fleming) at the resolution stage. This is what he said then:
This measure will ensure a greater discretion to the Minister of National Revenue with regard to decisions to be made under section 3.
It is not a matter of greater discretion but of an absolute and irrevocable power. It is nothing less than a reactionary right.
In other words, taxpayers are being deprived of a right recognized by British law and by tradition.
Regarding the dangers of using this discretionary power, I wish to read a few sentences from a book entitled:
(Text):
"Senate special committee on taxation, 1945."
I am referring to a brief presented by the

Customs Tariff
income tax payers' association to the Senate committee in 1945. This brief was read by Professor McDougall, associate professor of commerce, Queen's University. Here is what the brief had to say concerning this precise problem of ministerial discretion, at page 297:
May we recall in this connection the famous saying of the Middlesex rebels, "Where discretion begins, law, liberty and safety end."
In this brief the question is asked, "How is discretion exercised?" The question is answered in the brief in this way:
Normally it is given to the minister. In practice it is in the hands of the deputy minister and through him it is frequently exercised by other officials including junior assessors. Junior assessors first deal with and report on income tax returns. These reports go to head office and are there either confirmed or overruled by more senior officials. It is reasonable to believe that only the more important or "larger" matters ever reach the desk of even the deputy minister-and perhaps never the minister. The fact is, therefore, that ministerial discretion is exercised, never by the minister, in a few instances by the deputy minister but in the main by various clerks, assessors, other officials of the income tax service. One can well realize that the only safe decision for assessors and clerks to make is against the taxpayer.
Then, at page 299 we find the following:
We strongly urge therefore that the taxing power be returned to parliament where it belongs and that ministerial discretion be limited to administrative acts only, such as the prescribing of forms, the specifying of dates for filing and similar powers which pertain rightfully to the minister's duties as an administrator. In cases where it appears that it is impossible to avoid the granting of some judicial or semi-judicial functions to the minister or his officials, the exercise of discretion by them should never be final but should be subject to appeal to an independent appeal tribunal in the manner hereinafter referred to in respect of appeals.
(Translation):
Now, Mr. Speaker, the tradition is that parliament enacts legislation and that judicial or semi-judicial bodies are responsible for its interpretation. Such is the custom and tradition.
With this Bill C-72, we are taking a step backward. I say it is unwise to get away from this tradition. No serious reason has been advanced so far to justify such unappealable decisions as are provided for under this bill.
As the hon. member for Laurier (Mr. Chevrier) rightly mentioned, a customs duty is a tax, and the taxing power belongs exclusively to the House of Commons.
The immediate result of this bill will be to evoke feelings of uneasiness and uncertainty in Canadian business circles, because in many cases, very costly goods and considerable amounts will be involved.
Following the fears expressed by the members of the opposition in the debate on the resolution, I would have hoped that the minister would reconsider; apparently, he has done

no such thing, or if he has, he has persisted in his initial attitude.
If this bill is passed, it can only be a cause for regret, because some of its provisions are contrary to the traditions and essential rules of parliament.
The hon. member for Kenora-Rainy River (Mr. Benidickson), in his amendment, proposes, for the above reasons, that the bill be not now read a second time.
In closing, may I add this. It is rather strange to find that the very people who opposed the amendment put forward before six o'clock by the hon. member for Kenora-Rainy River are those who, in the past three or four years, have been so vociferous in calling for the maintenance of parliamentary rights and those century old rights which we have acquired through parliamentary tradition.
(Text):


Mr. H. C. McQuillan (Comox-Alberni):: Mr. Speaker, as a member from British Columbia, a province whose welfare depends greatly on export industries, I cannot subscribe to anything or any trend which may adversely affect the welfare of those industries or increase the capital cost of the plants and operations which produce those goods. In this I may be classed by many as provincially minded but I do not consider myself so. I sincerely believe I am thinking in the best interests of all of Canada. Furthermore, as a citizen of British Columbia, a province in which discretionary powers of ministers have not always been used in what I consider to be the best interests of the people, I oppose granting such powers to ministers of the crown excepting in circumstances of extreme necessity and urgency. Therefore, Mr. Speaker, it is my intention to support this amendment.


Mr. Speaker:: Is the house ready for the question?


William Hector McMillan: Mr. Speaker, I will vote for this amendment because the bill proposes to remove from parliament certain of its taxing powers. I believe this is the first time I have seen this happen in the house. I recall vividly the debate on the Emergency Powers Act which was to apply for a limited period of time. I recall the minister and other members of the treasury benches found fault with the government at that time because they said the government was assuming powers that rightfully belonged to parliament. At that time the emergency powers bill had a time limit. The bill now before us has no time limit. It will be passed by a big majority in the house and can only be revoked by a majority of the house.

This afternoon the minister referred to the fact that certain measures would be taken because of confidential information. This suggests to me that because certain information would be confidential the Minister of National Revenue (Mr. Nowlan) could not be compelled to give any information to the house concerning why certain duties had been applied. As members of the house we are surrendering our right to tax and also our right to obtain information as to the reasons why certain duties are imposed. If there has been erosion by the tariff board, if there has been erosion by the Supreme Court of Canada, if there has been contraction in the meaning of the words "class or kind", I would much prefer to see the government spell out the remedy in legislation and leave the right of appeal to the tariff board and to the Exchequer Court of Canada.
I think this legislation could lead to abuses. I am not referring to the present Minister of National Revenue any more than to his successors. To all intents and purposes this legislation will become permanent and will be removed only because of abuses or other causes. When the minister replies I would ask him to explain why this particular aspect of taxation cannot be spelled out in legislation as is the case with all other forms of taxation. In other words, is it not possible to bring forward a broader definition of "class or kind" goods which will stick so far as the tariff board and the Exchequer Court of Canada are concerned?
This afternoon the minister said, I think, that the Minister of National Revenue would have the final decision on three points. The first was with respect to whether goods are shelf goods or custom made to specification. It strikes me that these two things can be defined in such a way as to distinguish them. Second, in the case of shelf goods he said that the Minister of National Revenue would have the power to decide whether or not Canadian production amounted to 10 per cent of our consumption. This is factual information which should be available to all and I do not think such a matter should come before the minister for decision. I can see that there might be some difficulty with respect to the third point, namely, whether in the case of custom made goods adequate facilities exist in Canada to make them economically within a reasonable period of time.
So far as the first two points are concerned, I think the government could spell them out in legislation. In the one case factual information is involved and in the other case it is just a matter of a definition to distinguish shelf goods and custom made goods. I do not think that would be very difficult. The only difficulty that might arise,
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Customs Tariff
and which I think all of us appreciate, is whether or not facilities exist in Canada for the production of the custom goods made to specifications.


Mr. John Smith (Lincoln):: Mr. Speaker, my remarks at this time will be rather brief. I listened with particular interest to the remarks of the hon. member for Bonavista-Twillingate (Mr. Pickersgill) who seemed to be especially concerned about the loss of the rights of parliament in connection with the application of tariffs and duties. I should like to remind him that perhaps one of the last acts of the former government of which he was a minister was to impose a fair value for duty purposes on fruits and vegetables. They took this action and raised the tariff on certain fruits at that time, which was indeed a raising of tariffs without consulting parliament.
I remember the announcement in the newspapers at that time with respect to this action of the cabinet by order in council. It was pointed out in press reports that the then minister of finance, Walter Harris, had seen fit to take this action. He had reached into the closet and pulled out an old act passed in the days of the Bennett regime which had not been used for 22 years. However, when the chips were down and the former government was in trouble it decided to put the act into effect. This is indeed quite contrary to the opinion expressed by the hon. member for Bonavista-Twillingate at this time. What was good at that time surely should be good at the present time.
Last year or the year before the matter of fair value for duty purposes was debated in this house and discretionary powers were placed in the hands of the Minister of National Revenue (Mr. Nowlan) to take action if he saw fit. We went through the whole matter at that time. It was said that in taking such action we were only looking for retaliation from the United States but there has not been any retaliation, and after listening to all the debate I still feel that to place this reclassification matter in the hands of the Minister of National Revenue is to place it where it should be.
Perhaps the hon. member for Welland (Mr. McMillan) would prefer to have the present regulations continue whereby in order to secure a reclassification the matter has to go to the tariff board. Sometimes the board takes a year or two years to make a recommendation and then the matter has to come before parliament which may take six months or more to dispose of it. Therefore I think it is quite in order that we should cut out a lot of this red tape and get down to placing the responsibilities where they belong.

Division
I did not hear all the remarks of the hon. member for Kenora-Rainy River (Mr. Beni-dickson) but when I came into the house he was referring to statements I had made at the resolution stage. I think the hon. member for Kenora-Rainy River will understand that I respect the opinions he expresses in the house on many occasions, though I do not always agree with him. I should like to say that when I spoke on the resolution stage I was speaking more or less in general terms. At that time I referred to several commodities that could be made in Canada, some of which in fact are made here, and the fact that goods of a similar kind came into this country duty free. While the bill might not cover all the commodities I mentioned, I felt it was a step in the right direction and I still feel that way. I know that the house is anxious to get along with the bill, Mr. Speaker, and I believe these are the only points I wish to make. My only disappointment with respect to the bill is that it perhaps does not go far enough.


John Whitney Pickersgill: I said earlier when I was making a few observations on the amendment put forward by my hon. friend from Kenora-Rainy River that I intended to abide by the ruling of His Honour the Deputy Speaker and speak strictly on the amendment, reserving the general observations which I had to make about the bill untill we came to discuss the minister's motion for second reading.
I may say that it does seem to me that extraordinary as it was for the government to introduce this legislation at any time, in the light of what has happened in the weeks, the months, since this legislation was first proposed in the budget speech on December 20, during most of which time the minister has postponed it from time to time so that there would not be an opportunity to debate it consecutively-


Donald Methuen Fleming: That is utterly without truth.


John Whitney Pickersgill: While the minister has been flitting back and forth to British Columbia in equally futile efforts, during that time we have seen in every other country of commercial importance in the free world increasing indication that the whole trend, except in our own country, is toward the liberation of trade not toward the restriction of trade. Yet here are we under the present government going against the stream of freedom in the world at the present time.

It seems to me that anyone who has paid any attention to what was said as recently as last week by the British Prime Minister when he was here would appreciate how ill-timed, how unfortunate it is for the real interest of the country to be moving in the direction in which we are moving at the present time. It has already been made clear -and I do not intend to traverse this ground again this evening-that all the great export industries of this country, the industries which are finding competition increasingly difficult to meet as other countries rehabilitate their industry and build up their capital, are really greatly concerned about this move by the government which, they fear, as my hon. friend from Ottawa West (Mr. Mcllraith) pointed out at an earlier stage in the debate, will have the effect of increasing their costs or alternatively, driving them into the use of less efficient machinery or more costly machinery than would otherwise be the case.
It seems to me that these broad considerations ought to have influenced the government. It seems they should have taken account of the reaction in the world at large and the reaction of our export industries on whose success the income of about one of every four Canadians depends. It seems to me the government should have been warned by all this that we were moving in the wrong direction and that they should call a halt and abandon this legislation.
The Minister of Finance has told us over and over again that the principal reason for bringing this legislation before parliament at this time is that over the years the tariff board and the courts have eroded the law. In other words, the minister has said that neither the tariff board nor the courts knew what parliament meant and that the effect of the law as it was until 1949 has been changed by the decisions of the board and of the courts. I must say this is the first time in my recollection that a minister of the crown who is also an eminent member of the bar has criticized in this fashion decisions of the courts including the highest court of our country. However, as I said earlier, if the government feels the law as it now stands and as it has been interpreted by the courts does not represent what the majority of the members of this parliament want, then I suggest they should change the law and not attempt to abolish the rule of law.
Even if the supreme court has been as misguided as the Minister of Finance represented it as having been, the hon. gentleman is surely in error in suggesting that we must extinguish the jurisdiction of the court in the future. That, of course, will be the effect of this legislation.
Customs Tariff
In response to a request which I made at an earlier stage of the proceedings in committee-a request that we should be furnished with concrete examples of this alleged erosion; erosion which I may say the minister repeatedly said had taken place between 1950 and 1960-the hon. gentleman went back and spent some time discussing two or three cases in 1933 and 1934 which could not have had any conceivable relevance to the matter before us nor even to the proposition he himself had made. Then the hon. gentleman went on to cite the case in 1950 of the .22 rifles. This was the only case he took the trouble to discuss in some detail, and the minister was not very explicit even about that. But to the extent that he was explicit he was quite wrong.
What actually happened in 1950 was that the tariff board did not uphold the decision of the deputy minister at that time but, instead, went back to a decision of the deputy minister in 1939 and supported it. So, far from there being any erosion by the tariff board there would appear to have been some misinterpretation in 1950 of the meaning, as it was understood in 1939 of this legislation by parliament, and the tariff board, as one would expect, went back to that earlier decision.
The Minister of Finance, with the vast experience that he acquired over the years in opposition and the very brief experience he has had as Minister of Finance, in which his capacity for sound judgment in respect of financial problems has been demonstrated in such striking fashion to the country and to the house, has made a suggestion that is difficult to accept. The tariff board which, during practically all this period, he said, was characterized by this erosion, was presided over by Mr. Hector McKinnon who perhaps more than any other person in this country was in the confidence of the ministers of finance who were responsible for the law as it was in 1939, and in 1930 when Mr. Dunning first proposed this legislation in its modern form. To suggest that Mr. Hector McKinnon, who made these decisions, did not know what the law meant, but that the Minister of Finance who was opposed to the government that was responsible both for proposing and administering of the law is endowed with some special insight into it, is a proposal which every informed person will find very hard to swallow.
As my friend the hon. member for Kenora-Rainy River (Mr. Benidickson) has pointed out, Mr. McKinnon, after being for many years the principal tariff adviser to the Minister of Finance, and for 15 years the chairman of the tariff board, and even more extraordinary, after this vote of want of confidence by the Minister of Finance in

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Mr. McKinnon, he is still employed now, after his retirement, to advise the government and to conduct negotiations on its behalf. It does seem to me that the government would have been wise to think up some different excuse for this legislation than an attack upon Mr. McKinnon's knowledge of the law and on the capacity of the Supreme Court of Canada to interpret it. The Minister of Finance having misrepresented the rifle case to the house, then referred us to a lot of other cases but did not make the slightest attempt to show in any respect whatsoever how there could have been erosion.


William Moore Benidickson: That will take some days to look up.


John Whitney Pickersgill: The most serious of all the objections, except the one the house has already expressed a view on, but which is equal to it in its import, is the deliberate attempt of the government to abolish the rule of law, a deliberate attempt on the part of the government to exclude the taxpayer from the court, to which, up to now, he has had access.


Mr. Speaker:: I wonder if the hon. gentleman would agree with me that the question has been disposed of on the amendment?


John Whitney Pickersgill: No, sir, I do not think that question has been disposed of by the amendment. The amendment we had before us dealt with the taking away from parliament the tariff making powers, but did not in any way deal with the question of the denial of the right of appeal. It may be that-in order to show that the rights of parliament were taken away; there was, incidentally, reference to this other matter, but it does not seem to me that it was in any sense whasoever the subject of the amendment-this denial of the right of appeal, which is clearly set out in the legislation itself, and which is one of the fundamental terms of the legislation which the government has argued is necessary in order to make the legislation effective, is every bit as objectionable as the attempt to take from parliament its power to determine tariffs.
At page 1668 of Hansard of February 2, 1961 while in committee, the Minister of Finance in a reply to an intervention of mine, had the following to say:


John Whitney Pickersgill: -He is denying the right to an appeal in the future, and that is what we are objecting to.


Donald Methuen Fleming: You see, Mr. Chairman, this speech has been introduced under the guise of asking a question.


John Whitney Pickersgill: Well, answer it.


Donald Methuen Fleming: Answer the speech? I shall be prepared to answer anything that is raised in the committee and I shall be prepared to answer this point, hut I will first draw to your attention, Mr. Chairman, the manner in which the

hon. member, having taken to himself the right to ask a question, then comes forward in typical style to supply his own answer, which is a most erroneous and misleading answer, and then sits down with a look of utter satisfaction although the answer he has supplied to his own question is wrong.


John Whitney Pickersgill: You give the answer, then.


Donald Methuen Fleming: May I make my own statement?


John Whitney Pickersgill: Give the answer; never mind all the verbiage.
The minister then went off on some other theme. He has obviously been exceedingly uncomfortable about this matter and has sought, as far as possible, to evade direct answers. There is no way of getting around the fact that on three of the most important questions of fact-indeed one of them is absolutely fundamental-the minister's decision is to be final and not subject to appeal. I do not think that is in question. I have a good many references and am prepared to read them if it is. The minister decides finally on the basis of confidential information, without review or appeal of any kind, even by the cabinet, what goods are shelf goods and what custom made goods. This is a question of fact in respect of which it has never been necessary in the past to have a determination by the tariff board or the courts.


Thomas Miller Bell: Is the hon. gentleman going to answer the question I asked in regard to this point?


John Whitney Pickersgill: Perhaps the hon. member would like to repeat it.


Thomas Miller Bell: The question I asked the hon. gentleman earlier, which he avoided, was whether he approved of the distinction that was made between shelf goods and custom goods made to specification?


John Whitney Pickersgill: I certainly do not approve of the distinction in the form it is made in this bill. I do not approve of giving the Minister of National Revenue the power to determine whether an article is custom made or shelf goods. As to the broader question which the hon. member for Carleton (Mr. Bell) has asked-it is a very important one-I would say this. I have the very gravest doubts as to whether, under the obligations we entered into in the Canada-United States trade agreement, and subsequently in GATT, that it is a proper thing to do; I fear it is a thing that will be regarded as an infringement of obligations solemnly entered into for this parliament to say that goods are made in Canada, and to use that provision of the law, in respect of things that are not made in Canada.

That is made perfectly clear with the definition that is given here of "custom made to specifications", and whether adequate facilities exist in Canada to make them. I am sure that, if I were the representative of another country having commercial relations with Canada, another country which had agreed to the provisions that now exist in the law, I would regard this as an evasion of that law. I am perfectly sure that if the Americans undertook to do anything similar we would, as the minister used to say when he was over here, talk to them in no uncertain terms. Well, he does not talk that loud any more now when he has to go down to Washington and see them. In fact, what began with a bang is ending in a whimper so far as the minister is concerned when he goes to Washington.
But the plain fact is if the Americans made a similar distinction in relation to something that we thought they had conceded to us in a trade agreement there would be a mighty howl in Canada about it, and every Canadian who is honest with himself knows it. To me it looks like pretty sharp practice. But I say, sir, that if any distinction is to be made it should be made clearly and explicitly by this parliament, and that the question of fact should be determinable by the tariff board as other questions have been determinable by the tariff board in the past in respect of these "made in Canada" rules. In the past every aspect of the facts has been open to review by the tariff board. Now certain aspects are taken away from them. This is the whole point.
There might be an argument for saying that there should be no court of appeal, no review instituted on something which has never been reviewed in the past, administrative decisions which have never been the subject of appeal in the past. But here, sir, we are deliberately saying that some of the facts which in the past have been appealable to the tariff board and to the courts are no longer to be appealable. In other words, we are extinguishing an existing right to judicial determination of facts and vesting the decision instead in a single minister. It seems to me, sir, that that is far and away the most serious aspect of this legislation apart, as I have said, from the derogation of the rights of parliament which we believe the bill also embodies.
The most serious feature is, of course, the minister making the final decision. I ask the minister again why? I ask the hon. member for Greenwood (Mr. Macdonnell), who has some regard for these matters, why should the tariff board not be able to look at all these facts? Surely the question of whether an article is custom made or shelf goods is a
Customs Tariff
question of fact which could be determined in the open, publicly, with argument heard on both sides.
One of the ministers said that it was a very simple matter; the other rather suggested it was not; we have had a good deal of double talk of that sort. To me it should be a matter of fact, and it should be determined in the open and publicly.
This is not a small matter; this is a matter that can affect business operations and affect employment. I understand that at the beginning of the afternoon, before I was able to get into the house, the minister talked about this so-called erosion having affected employment adversely. Well, we are very much afraid that these arbitrary decisions, against which there is going to be no appeal, are going to affect employment adversely.
Then, sir, why should normal Canadian consumption of shelf goods be abstracted from the list of facts which the tariff board can determine? Even when something is ruled to be shelf goods, why should just one of the facts be taken away? I cannot give any rational explanation of that at all and I have not heard any from the other side of the house. The tariff board can determine the production but not the consumption. If anything might have been considered secret, one would have thought that the production would be more apt to be something about which producers would be concerned with maintaining secrecy. Surely the total consumption in Canada should not be a matter of secrecy. The suggestion that there is some mysterious statistic available to the Minister of National Revenue that would not be available to the tariff board is a suggestion that anybody with the faintest experience with administration knows is too ridiculous an argument to be seriously accepted for a moment.
It seems to me, sir, that there is just no rational justification whatsoever for this clause. The result is that the denial of the right of appeal has created in many minds the impression the government is doing this deliberately because it wants to have the capacity to favour some people as opposed to others. I am not making this charge myself. This is an impression that is widespread in the country and it is the kind of impression that is bound to be created whenever these secret and arbitrary powers are given to ministers of the crown.
Why do they want them to be secret? Why do they want them to be arbitrary? What are they afraid of? I remember Mr. Graydon, the former leader of the opposition, would talk about pulling up the blinds and letting in

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the light. The Prime Minister used to be very eloquent on this subject when he was on this side of the house.
As I say, even if the government does want to change these definitions, even if it does want the rest of this legislation, it is impossible to see why it feels it necessary to deny and to nullify the right of appeal that now exists.
I reminded the committee at an earlier stage, and I should like to recall it once more of a statement made by the Minister of Finance some years ago, which I think all of us in this house should ponder. I may say I do not too often agree with the Minister of Finance. He was not minister of finance then, but I certainly agree with what he said at that time. This is what he said, and it is very apt. It applies with great force to the legislation now before us. On June 7, 1955, the Minister of Finance said, as recorded at page 4524 of Hansard of that day:
Sir, hon. members, as I conceive it, were elected to this house to legislate, not to abdicate the legislative function to the government. They are elected to preserve freedom, not to open the doors or admit the Trojan horse of executive power into the citadel of Canadian freedom.
We of Her Majesty's loyal opposition have fought this kind of legislation, and I think we can point to some success.
Well, considering the kind of government we have now, I am not sure, sir, that we will be able to point to any success; but I do say that that is no reason why we should not fight this attempt to abrogate the rule of law, this attempt to take away access to the courts which now exists, this attempt by a government that only a year ago asked this parliament, and got this parliament unanimously to enact a bill of rights, to take away one of the fundamental rights that bill was supposed to safeguard. That, sir, is in the highest degree astonishing to us on this side of the house and, of course, not only to us.
I should like to refer to, and to express as my own views, views that were expressed on March 18 in a journal published in this country which is not a notorious proponent of free trade, a journal which I think may fairly be regarded as a supporter of, at any rate, moderate protection. I refer to the Financial Post. As I say, I make these words completely my own. That paper said:
For all Canadians, as well as for manufacturers and importers, a very basic principle is at stake in the current revision of the Canadian Customs Tariff Act. It is the right of a private citizen to appeal to an independent tribunal if he believes he has been wronged by those empowered to administer and put into effect government legislation. This is precisely the right that is being taken away in one part of the government bill, currently before the house, to define whether goods are of a "class or kind" made in Canada. In three specific matters, the decision of the Minister of National Revenue

will be final and, if the bill passes in its present form, there can be no appeal to the independent tariff board. This is unwanted, unnecessary and dangerous. The thing should be strangled in its cradle.
Indeed, sir, one wonders why it was ever born, especially with the paternity of the right hon. gentleman who also sponsored the bill of rights. Therefore, sir, I wish to move, seconded by the hon. member for Trinity (Mr. Hellyer):
That all the words after "that" be struck out and the following substituted therefor:
"this house declines to proceed with a bill the fundamental terms of which, by seeking to deny an appeal by the subject to the courts now provided by law, are repugnant to the spirit and objectives of the Canadian bill of rights."


Mr. Speaker:: Before I place this amendment before the house, is there any comment?


Mr. Speaker:: I declare the amendment lost.


Erhart Regier: Because of the lateness of the hour, Mr. Speaker, I wonder whether I might be permitted to move the adjournment of the debate.


Some hon. Members:: No.


Erhart Regier: If hon. members object, I shall begin. We have been entertained over a considerable number of days at various stages of this measure by spokesmen for the Liberal party. I can remember very well an election campaign in 1940 when the speaker so adequately and so graphically explained to his audience that, despite the differences or the professed differences of the Liberals and Conservatives on this matter of tariffs, to the consumers and to the producers of Canada each time there was a change of government all it meant was higher tariffs regardless of any election promises or any speeches they had made in years gone by.
I also thought that the Liberals had a great deal of gall to be appealing to the parliament of Canada and to the people of Canada at
Business of the House
this stage with regard to the rights of parliament. After all, I do not think I am the only one in Canada who has a bit of a memory. We can remember only too well that a limited number of years ago the Liberal party of Canada showed no concern for the rights of parliament.


Mr. Speaker:: Order. I think the hon. member will agree with me that the issue with regard to parliament delegating its authority was disposed of by the first amendment. The second amendment disposed of another question. The hon. member has a rather limited scope now in the debate on second reading.


Erhart Regier: I should like to express my disappointment. The minister today made it abundantly clear that he was not happy with the decisions of the tariff board. He spoke of erosion of the customs tariff legislation that had occurred because of the decisions of the tariff board. To me the minister came very close to expressing contempt for what is in effect a court of law established by this parliament.
I wonder whether I might move the adjournment of the debate, Mr. Speaker.


Mr. Speaker:: I will call it ten o'clock.



BUSINESS OF THE HOUSE

Lionel Chevrier: May I inquire from the house leader what we will do tomorrow and the next day.


Gordon Minto Churchill: Tomorrow we will carry on with this debate. If it is concluded, we will then take item No. 5 on today's order paper, Bill No. C-82 which refers to a convention between Canada and the United States of America with regard to taxation matters. If that business is concluded, we will take item No. 9 on today's order paper, a resolution in the name of the Minister of Labour dealing with vocational rehabilitation.


[Stage Direction]
At ten o'clock the house adjourned, without question put, pursuant to standing order.
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[Stage Direction]
Questions