1961-05-12

Hon. Donald M. Fleming (Minister of Finance):: Hon. members are no doubt aware that on May 2 President Kennedy of the United States made an announcement drawing attention to his view that a long term solution on an international basis was required to deal with the problem arising from international trade in textiles.
A tripartite meeting at the official level has been arranged to be held in London next week on this subject. Canadian representatives will participate there in informal discussions with representatives of the governments of the United Kingdom and the United States to discuss these textile problems. It is expected that officials from the crown colony of Hong Kong will also participate in these discussions.
Canada has consistently supported previous attempts to find a comprehensive international solution to these problems; always, of course, without prejudice to Canada's freedom of action, under our trade agreements, to take measures to avoid injury to particular Canadian industries during the period when a broad international settlement is being negotiated.


Hon. L. B. Pearson (Leader of ihe Opposition):: Mr. Speaker, we on this side certainly welcome this action on an international basis if it will lead to expansion rather than restriction in trade in this important commodity.



INDUSTRY


Hon. Leon Balcer (Minister of Transport):: Mr. Speaker, hon. members are aware of the serious problems which during the last 15 years have faced the ship operating and shipbuilding industries in Canada in maintaining activity and employment in both fields.
This matter has been receiving the active consideration of the present administration since it took Office, and I wish to announce that a policy has been determined which will
be of major benefit both to our Canadian ship operators and to our Canadian shipyards. This policy is intended to make it possible for Canadian ship operators to obtain new vessels from Canadian shipyards at reasonable and competitive prices instead of being forced to have them built abroad because of the lower construction costs that prevail in other countries. It is also intended to make it possible for the Canadian fishing industry to obtain the necessary degree of assistance to encourage it to modernize its fleet by the construction of new vessels in Canadian shipyards on a basis which will still keep the costs to the Canadian fishing industry at a competitive level and halt the trend of construction of vessels for the Canadian fleet in other countries.
Finally, the policy is intended to deal with the situation which has emerged recently in the great lakes trade as a result of the arrangements which have made it possible for foreign vessels of commonwealth registry to participate in the domestic trade within this area.
To achieve the first objectives, namely assistance to our domestic operators and our fishing industry in obtaining new vessels from Canadian yards, parliament will be asked to provide, by way of departmental estimates, funds to assist in the construction of vessels for operation under Canadian registry whether in our domestic trades, in the fishing industry, or for use on the deep seas. A special capital subsidy of 35 per cent of approved costs of construction will be paid toward the construction in Canada of Canadian registry vessels, other than fishing vessels, whether for domestic or deep sea work, effective immediately. Moreover, to provide the maximum degree of incentive over approximately the next three years, this 35 per cent rate of assistance will be increased to 40 per cent for any work done between the present date and March 31, 1963. After that date the rate will be set at 35 per cent.
With regard to the fishing industry, a capital subsidy of 50 per cent of approved costs incurred from the date of this announcement will be paid toward the cost of the construction in Canada of steel fishing trawlers in any case where the new trawler will replace one old vessel which will be withdrawn from service. In addition, the present special assistance of up to 165 per gross ton payable toward the cost of construction in Canada

Government Policy in Shipbuilding of wooden fishing vessels over 45 feet in length will be increased to $250 per gross ton.
The foregoing assistance will be effective immediately, applicable to vessels now under construction and to vessels on which construction may be started hereafter. In the case of vessels now under construction, however, it is intended that the assistance will apply only to work which may actually be carried out from this day onward and not to construction work performed before this day.
The methods of determining approved costs for this purpose and other particulars relating to administration of this plan will be prescribed by regulations to be approved by the governor in council. These regulations will, of course, deal with the question of limiting the proportion of non-Canadian content to be included in costs for the purpose of the subsidies. These regulations have not yet been approved by the governor in council, but they will be tabled in the house as soon as they are in final approved form.
The government has also given considerable attention to another problem which relates to the great lakes area, and which has arisen since the royal commission on coasting trade made its report. Under the commonwealth merchant shipping agreement, a vessel of commonwealth registry may engage in the domestic coasting trade of Canada, and Canadian registered vessels enjoy reciprocal privileges in other countries. This agreement was made many years ago and long before the construction of the St. Lawrence seaway. Prior to the construction of the seaway, deep sea vessels, other than those of very small size, did not have direct access to the great lakes, and in those waters which are basically inland waters the domestic coastal trade was more or less effectively reserved to Canadian registered vessels.
Within the last couple of years, in a number of cases old United States lake vessels which under the authority of the Canada Shipping Act would have been refused Canadian registry, have been purchased by certain operators who have applied for and obtained nonCanadian commonwealth registry with a view to putting those vessels in Canadian domestic service. In addition, other Canadian operators have moved in the direction of transfer of some of their existing great lakes vessels of Canadian registry to non-Canadian commonwealth registry.
Investigation has indicated that apparently under United Kingdom law applications for United Kingdom or colonial registry in cases of this sort have to be granted unless there is something technically wrong with the vessel itself, and there is no method under existing British law by which this condition of


affairs can be dealt with. Because the government believes in effect the domestic Canadian trade within the great lakes area was not in any sense contemplated as part of the reciprocal privileges when the commonwealth merchant shipping agreement originally came into force, and that this trade should be effectively reserved to Canadian registered vessels, accordingly the government has decided to initiate steps for modification of the commonwealth agreement to exclude this area.
For this purpose we will be approaching the other parties to this agreement to notify them of our decision to exclude from the provisions of this agreement the great lakes area, which will be defined as commencing at the outermost pilotage station in the St. Lawrence river in the vicinity of Les Escoumains. The effective date of this change, of course, can only be determined after notification to and consultation with the other commonwealth countries concerned and will, I expect, also involve amendment to the Canada Shipping Act.
This new policy will be of great benefit to Canadian ship operators and Canadian seamen as well as Canadian shipyards, and their employees and suppliers. It will help our domestic operators, whether these be inland, coastal or deep sea operators, and whether their craft be cargo vessels, passenger vessels, tankers or schooners on the St. Lawrence, or other powered craft of reasonable size.
It is virtually impossible to forecast accurately what this program will amount to in terms of expenditure and employment, since the initiative in making it successful must now rest with our ship operators themselves. However, at a very rough estimate I would expect this should cover more than 10,000 man years of additional employment in each year for the next few years in our shipyards, and probably an equal number in supporting and supplying industries, to say nothing of increased opportunities that may result for seafaring personnel.


Hon. Lionel Chevrier (Laurier):: Mr. Speaker, the statement made by the Minister of Transport is perhaps one of the most important to be made in the house in a long time. I am sure that not only the house will welcome the statement he has made but also, in an especial manner, those who are connected with the operation of ships and the building of ships and those who sail ships on the inland waters of Canada. The statement has both national and international implications, particularly because of the last part with which the minister has dealt. However, it is not my intention to inject into my statement a partisan note, other than to

say that we on this side of the house have asked for the policy of the government-


Some hon. Members:: Oh, oh.


Mr. Speaker:: Order. There is no necessity to interrupt the hon. member.


Lionel Chevrier: -on many occasions, and I am extremely happy that the minister has finally acceded to our request and the requests of the shipbuilding and ship operating industries.
As I understand the statement which the minister has made, I think it can be divided into three parts. First, it has to do with the assistance that will be given to domestic operators. Second, it has to do with the assistance that will be given to the fishing industry which, incidentally, was dealt with by the hon. member for Gloucester last evening when he asked the government to come to the assistance of that industry. Finally, the statement has to do with the great lakes area. To deal with the last part more particularly, that is the one which will require not only amendments to the Canada Shipping Act but also amendments to the commonwealth merchant shipping agreement because, as the house knows, British and commonwealth ships have the right to cabotage in those areas.
If I understand the minister right, it is the intention now to draw a line at Les Escoumains and to prohibit cabotage by ships of British or commonwealth registry in the area upstream from Les Escoumains to the head of the lakes. That is a matter which, as I say, has international implications as well as domestic ones; and without making any further general comment on it may I say that I think we on this side of the house would like to give it careful and intensive study.
So far as the assistance referred to in the earlier part of the minister's statement is concerned, I think everybody will welcome that, and I do not hesitate to commend the government and the minister for the decision which has been taken in that respect.
My suggestion, for what it is worth, is this. Many months ago the minister made a statement in the house that amendments of this kind would be announced. Because they were not announced, and because of the delay with reference to the announcement of that policy, my hon. friend knows that one prominent operator in Canada assigned his flag to Bermuda registry. I am wondering if the government will not give consideration to making the assistance which has been announced retroactive to the time the minister made his first announcement in the house.
With respect to the general picture, Mr. Speaker, all I need do in conclusion is to
12, 1961
Government Policy in Shipbuilding repeat that this is important and comprehensive legislation to which we will give consideration. I take it that the minister will lose no time in introducing it in the house.


Mr. Harold E. Winch (Vancouver East):: Mr. Speaker, the shipbuilding industry will undoubtedly be interested in the statement which has just been made by the minister. On behalf of this group I can only express regret that it has taken governments 15 years to recognize the need of granting assistance to the shipbuilding industry of this country. It is certainly to be hoped the situation has not deteriorated to a position where it will take too long to rebuild it as a major Canadian industry.
In view of the outstanding record established by the Canadian shipbuilding industry both in peace and war it is perhaps surprising that this industry should have been allowed to deteriorate to the position it now occupies, in which so many of our shipyards are either closed or operating on short time. However, at long last a statement has been made, and as I say it will no doubt be of interest to the industry. It is impossible to say at this time how far the policy statement will go. Before commenting on that we will have to wait until we have more details, which I hope will be given at the time of the discussion of the departmental estimates or at the time of the introduction of amendments to existing legislation.
The statement of the minister covered three phases, all of importance. One of particular importance today is that relating to the fishing industry. I could not gather from the minister's statement how beneficial an effect this will have on the fishing industry, because I gather that there is a severe limitation on the type of fishing vessel that will be covered under the subsidy. Be that as it may, we express regret at the delay and the deterioration. We will make a careful study of the details when they are available. At that time I hope we will be able to commend at least in part the statement of policy announced by the minister, and we certainly hope it goes as far as he anticipates. It is my personal hope that it goes a lot further.

On the orders of the day:


Mr. Hubert Badanai (Fort William):: Mr. Speaker, I should like to address a question to the Minister of Transport arising out of the announcement he made to the effect that assistance will be provided to Canadian shipbuilding industries. Can the minister indicate whether the government will exercise its influence in allocating the work to shipyards where a surplus of manpower is available.

Inquiries of the Ministry


Léon Balcer: Of course the government wants to help both shipyards and shipping operators by providing these subsidies. However, I do not think we should interfere in the process of an operator choosing which shipyard is going to handle his work. I do not think it is the role of the government to do that in these circumstances. If it were a government allocation of contracts, of course we would do that; but not in this case.


Lionel Chevrier: I should like to address a question to the Minister of Transport arising out of his announcement made a while ago. Over and above the amendment to the Canada Shipping Act, will the assistance which the minister has announced be brought into the house by way of a bill or other legislation to amend the vessel construction assistance act.


Léon Balcer: As I mentioned in my statement, this can be brought into force by an item in the estimates.


Lionel Chevrier: The whole program will be implemented in that fashion?


Léon Balcer: Yes, Mr. Speaker. However, there will be an amendment to the Canada Shipping Act in relation to the commonwealth coastal agreement.


Lester Bowles Pearson: May I ask the minister whether the amendment to the commonwealth shipping agreement which will be required was discussed with the government of the United Kingdom before the government of Canada decided on this policy?


Léon Balcer: Mr. Speaker, we are going to follow precisely the procedure that exists at the present time in regard to these agreements. We are going to notify the various commonwealth countries along the lines of article 25 of this agreement, and I think, after a period of three months, we will be in a position to enforce our proposals.


Lester Bowles Pearson: Mr. Speaker, may I ask the minister whether his reply means that legislation cannot be introduced until the amendment has been made to the commonwealth agreement?


Léon Balcer: The amendments I have mentioned are very minor amendments in the shipping act, but will not affect the principles of the plan. I think the plan can be put into action and enforced without these amendments having previously been passed.



EXTERNAL AFFAIRS


[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: Mr. Speaker, 1 wonder if the Prime Minister would care to comment on a report that the Secretary of State for External Affairs said in Geneva that he was prepared to help mediate the dispute between the United States and Cuba, and on a report from Washington that any such offer from Canada would not be acceptable.


Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, I do not think it is necessary to make any comment. The hon. gentleman asked a question and then answered it in his own way, and I see no necessity for any further comment on the question.



INQUIRY AS TO SAFETY OF CANADIAN


[Stage Direction]
On the orders of the day:
Mr. Nicholas Mandziulc (Marquette):: Mr. Speaker, I wish to direct a question to the Prime Minister. Has the Prime Minister any report to make on the safety of priests and nuns on missionary duty in Cuba?


John George Diefenbaker: Mr. Speaker, this matter is a subject of continuing discussion by the Canadian embassy in Havana as well as with the Cuban ambassador in Ottawa. I think it may be concluded that everything possible is being done to ensure the welfare and safety of the persons mentioned, and indeed all Canadians.



VISIT OF PRESIDENT OF ICELAND TO CANADA

[Stage Direction]
On the orders of the day:
Mr. Harris Rogers (Red Deer):: Mr. Speaker, I should like to direct a question to the Minister of Northern Affairs and National Resources. In view of the proposed visit of the president of Iceland to Canada this summer and his intention to visit the hamlet of Mark-erville and the national historic monument to the outstanding Icelandic and Canadian poet, Stephen G. Stephansson, would the minister undertake to:
(a)	do everything possible to make this a memorable event and;
(b)	have a suitable marker placed at the junction of the old and new highways west of Innisfail to direct visitors and tourists to this specific Canadian historical site?
Hon. W. G. Dinsdale (Minisier of Norlhern
Affairs and Nalional Resources): Mr. Speaker, 1 am pleased to learn that the president of

Iceland will include a visit to the historic site at Markerville during his forthcoming visit to Canada. I can assure the hon. member that we will have officials inspect the site to make certain it is in the best possible condition. As for the highway marker, this is a matter that comes under the provincial highway authorities. I shall be happy to communicate with them on this matter. In view of the international aspects of the visit I shall also contact my colleague the Secretary of State for External Affairs.



INQUIRY AS TO CONFERENCE OF COMMONWEALTH ECONOMIC OFFICIALS

[Stage Direction]
On the orders of the day:
Mr. Hazen Argue (Assiniboia):: Mr. Speaker, I should like to direct a question to the Minister of Finance. Since the common market will affect Canada in so many important ways and since there is such great interest in Britain's attitude to the common market, I wonder whether there is anything the minister might tell the house about the forthcoming conference of commonwealth economic officials, and whether there is any change in Canada's attitude to the common market.


Donald Methuen Fleming: Mr. Speaker, the Canadian government continues to take the very proper attitude that it has taken throughout in reference to this subject.
The meeting of senior officials which will be held shortly is the annual meeting at which all questions of interest to commonwealth countries in relation to economic and trade questions are discussed.



INDIAN AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. Walter Pitman (Peterborough):: Mr. Speaker, I should like to direct a question to the Minister of Citizenship and Immigration or the minister's parliamentary secretary. Would the parliamentary secretary confirm the report of Chief Telford Adams that the Indian affairs department is preparing an order in council under which the crown would have no further rights on Sarnia Indian reserve lands?


Mr. John Charlton (Parliamentary Secretary to the Minister of Citizenship and Immigration):: Mr. Speaker, I will take the question as notice and get the reply.
Inquiries of the Ministry AGRICULTURE



SUFFIELD, ALTA.-REQUEST FOR RELEASE OF CROWN GRAZING LANDS

[Stage Direction]
On the orders of the day:
Mr. E. W. Brunsden (Medicine Hat):: Mr. Speaker, may I address a question to the Minister of National Defence. Is the minister prepared to make to the house, and through it to the farmer-ranchers of southeastern Alberta, a statement with respect to the release, in this year of subnormal moisture in my area, of part of the grazing land with access to stock water now occupied by the defence research station at Suffield? Also, is the minister prepared to assure those interested in this proposed release of crown grazing lands, with their availability to water, that it will be on the basis of full protection to the smaller farmer-ranchers on a strictly community pasture basis?


Hon. D. S. Harkness (Minisier of National Defence):: Mr. Speaker, in view of the shortage of grass and water in southeastern Alberta this year the defence research board did make a study of the work being carried on at the Suffield station with a view to making available this year some land for grazing purposes.
As a result we have decided to make available approximately 150,000 acres adjacent to the South Saskatchewan river. We have also decided that the most equitable way to do this would be to put the operation into the hands of the community pasture organization under P.F.R.A. Discussions are going on at the present time between officials of that branch and officials of the defence research board to arrange details as to how the operation will be carried on.



REQUEST FOR SEATING PLANS FOR STUDENTS IN GALLERY

[Stage Direction]
On the orders of the day:
Mr. W. B. Nesbiif (Oxford):: I wonder whether I could address a question to Your Honour. In view of the fact that many student groups are visiting this chamber at the present time and will be doing so during the coming weeks, I wonder whether Your Honour would give consideration to seeing that seating plans are provided and made available for students who visit this chamber.


Mr. Speaker:: The hon. member's suggestion will be noted. It is not acceptable as a question.

Inquiries of the Ministry (Translation):



USE OF RAILWAY COMMITTEE ROOM FOR ENTERTAINMENT PURPOSES

[Stage Direction]
On the orders of the day:
Mr. Azellus Denis (St. Denis):: Mr. Speaker, I should like to put a question to the Secretary of State.
My wife has been invited to a fashion show to be held in the railway committee room and sponsored by the wives of Conservative members, among them Mrs. W. M. Hamilton and Mrs. Noel Dorion.
Could the minister tell us whether this social event is part of the program set forth by the Associate Minister of National Defence (Mr. Sevigny), to the effect that bread, games, balls and fashion shows are what the Conservative party needs to promote its popularity?


Mr. L. J. Pigeon (Jolielfe-L'Assompfion-Monicalm):: That is a silly question.
(Text):


Mr. Speaker:: Order. I think the hon. member is perhaps getting outside the jurisdiction of any minister of the crown or any member of this house.



IMMIGRATION


[Stage Direction]
On the orders of the day.
Hon. J. W. Pickersgill (Bonavista-Twillin-gaie):: Mr. Speaker, I wonder whether I could ask the parliamentary secretary to the Minister of Citizenship and Immigration whether the hon. gentleman has any explanation to offer for the fact that British immigration has now fallen to third place in this country?


John Alpheus Charlton: Mr. Speaker, this is a statement by the hon. member for Bonavista-Twillingate. I do not know whether or not it is correct. I shall find out.


John Whitney Pickersgill: A supplementary question, Mr. Speaker. Has the hon. gentleman seen the statement issued by the department on the subject?



HOUSING


[Stage Direction]
On the orders of the day:
Hon. D. J. Walker (Minister of Public Works):: Mr. Speaker, on May 10 the hon. member for Vancouver East referred to an advertisement which appeared in journals in London, England, recruiting personnel for Central Mortgage and Housing Corporation.


The advertisement asked for applications by town planners to serve in the corporation.
Before seeking applicants outside of Canada the corporation endeavoured, in vain, to obtain them within Canada, first through the national employment service, second through advertising in the professional journals, and finally through the newspapers in the larger cities. They have had a requisition on file with the national employment service since 1959 in an effort to get these town planners. The response, however, was very limited.
We finally obtained permission from the national employment service to recruit in the United Kingdom and Europe a limited number of town planners who are qualified for the difficult services involved.


Mr. J. R. Garland (Nipissing):: Mr. Speaker, I wonder whether I might ask a supplementary question. Is it customary or necessary to pay the passage, as was indicated in this advertisement, of these people and their families when they are being brought to Canada for professional jobs with good incomes?


David James Walker: I shall be glad to accept that question as notice. I thought the hon. member for Nipissing was going to ask me about the latest housing starts and figures, and applications for loans.


John Richard Garland: I thank the minister for replying in his usual superior tone. However, since he is taking the question as notice I wonder if he will also tell us how many Canadian officials have travelled, or will travel to Europe to interview these applicants.



NATIONAL REVENUE


[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Port Arthur):: I should like to ask the Minister of National Revenue in his role as keeper of the ramparts of purity what the purpose was of the seizure of several books published by Penguin Books, including the "Physiology of Sex" by Kenneth Johnson and "Lady Chatterley's Lover" by D. H. Lawrence.


Hon. George C. Nowlan (Minister of National Revenue):: I do not think I can accept the compliment-I presume it was one-of being the keeper of the ramparts of purity in this country, but I will make inquiries with respect to the particular matter to which the hon. member referred. As the house knows, from time to time books are held for inspection. Very rarely do they get to my desk. When my officials have found, after due inspection, that it appears necessary to refuse

them admission, they finally come to my attention; and I am looking forward, after hearing the hon. member, to receiving a shipment which I can inspect.



PUBLIC SERVICE


[Stage Direction]
On the orders of the day:
Azellus Denis: May I address a question to the Postmaster General. Is it true that thousands of part time employees presently employed in the Post Office Department will have for the first time to pass an examination in order to keep their positions? If the answer is in the affirmative, would the Postmaster General care to comment on this new policy?


Hon. W. M. Hamilton (Postmaster General):: Within the last year we have increased the salaries of our part time post office workers from $1.26 to $1.72 an hour, thus bringing them to a scale parallel with that of our regular postal clerks. In the light of this we shall expect these people to meet somewhat less stringent but approximately the same requirements that apply to our regular postal clerks, and the only way to determine this is to examine them on their knowledge. The average postal clerk is required to know between 2,000 and 5,000 distribution points in order to maintain the efficiency of the service. A part time worker will begin with a requirement of knowing some 300 distribution points and after several months he will be expected to know about 1,000. I think that is reasonable.
These people are being paid far better than ever before in our history. Also, in accordance with our expectation, which has been borne out by the civil service, we expect top notch performance from them.


Azellus Denis: Does this new policy apply to the so-called flying squad or call girls who have been hired by the present administration and who perform the same type of work as that performed by part time employees?


William McLean Hamilton: The
hon. member is much more expert on the subject of call girls than I am, Mr. Speaker-


Some hon. Members:: Oh, oh.


William McLean Hamilton: As
far as I am concerned, dealing with postal employees, the increased salaries and the regulations will apply to those part timers who are working on the sorting of mail.


Azellus Denis: Do I understand that this new policy is part of the program being adopted in order to replace men by machines, because
Inquiries of the Ministry
I	am sure that not one half of these thousands of part time employees who have been working in the post office for years would be able to pass an examination, though they do their jobs perfectly well. They would have to learn about 2,000 names.


Mr. Speaker:: Order. The hon. member should reserve his speeches until the estimates; possibly he has already made them on the estimates.


William McLean Hamilton: Dealing very briefly with the first sentence, which was a question, may I say that this forms part of the government's program to treat its employees well and to operate the service efficiently.



INQUIRY AS TO INCREASE IN DELIVERY QUOTAS

[Stage Direction]
On the orders of the day:
Hazen Robert Argue: I wish to direct a question to the Minister of Agriculture. Since the end of the crop year is just some two and a half months away and the majority of marketing points in Saskatchewan and Manitoba are on a 3 bushel quota or less, can the minister say what the prospect is of reaching a 7 bushel quota by the end of July?


Hon. Alvin Hamilton (Minister of Agriculture):: I think the western farmer is aware that never before have such efforts been made to move grain out of Canada as have been made in the last few months. I might mention in passing that as part of this program we have stepped up the capacity of the west coast ports to handle this traffic. In the month of April we shipped 19 million bushels out of there, and this month we expect to ship 20 million bushels. I am leaving this week end to see whether I cannot get another couple of million bushels.
From the great lakes, shipping is moving out at a pace away above last year. At the present time nearly a thousand cars of grain a day are moving into Fort William and Port Arthur, and between 300 and 400 cars daily are moving in the west coast ports.
In answer to the question asked by the hon. member, I should just like to say that on May 8 the official quotas in western Canada were as follows: 213 points were on a 2 bushel quota, 742 were on a 3 bushel quota, 394 were on a 4 bushel quota and 645 on a 5 bushel quota.
Now let me give the hon. gentleman the figures for three days later, May 11. On May
II	the number of points on a 2 bushel quota had dropped from 213 to 58. The number on a 3 bushel quota had increased from 742

Inquiries of the Ministry to 841. The number on a 4 bushel quota had gone up from 394 to 419 and the number on a 5 bushel quota had dropped from 645 to 443. The 6 bushel quota points now number 233, having risen from zero. This dramatic shift in the quota figures is proof that the efforts being made to ship this grain out of the country are succeeding. I wish to thank the farmers of western Canada for being so understanding and co-operative on quotas.


Mr. Speaker:: Order. I do not like to interrupt, but it seems to me the minister's answer has been broad and comprehensive.


Hazen Robert Argue: After that long propaganda
speech by the Minister of Agriculture, I wonder if I might repeat my question, because the minister failed to answer it. My question was whether he could hold out the prospect, as he has done heretofore, that producers in Manitoba and Saskatchewan, in particular, where quotas are discriminatory, will have the opportunity of delivering a 7 bushel quota at the end of July.


Francis Alvin George Hamilton: These extreme expressions such as "discriminatory quotas" are being answered every day at the present time in connection with the quotas. I suggest to the hon. member that if he is patient and watches the quotas change in the months of May, June and July he will not be disappointed and have to use such expressions at all.



INDUSTRY


[Stage Direction]
On the orders of the day:
Hubert Badanai: Mr. Speaker, I should like to ask the Prime Minister whether he would indicate when the report of the royal commission appointed to make a study of the automobile industry will be tabled in the house.


John George Diefenbaker: Mr. Speaker, that report will be tabled in due course.



HIGHWAYS


[Stage Direction]
On the orders of the day:
J. Nicholas (Nick) Mandziuk: Mr. Speaker, I should like to address a question to the Minister of Northern Affairs and National Resources. Has the minister received, and is he giving consideration to, a resolution from the village of Rossburn and the rural municipality of Rossburn, and a petition by the village of Shoal Lake regarding a proposal


for the construction of a cross mountain route through the Riding Mountain national park?


Hon. W. G. Dinsdale (Minister of Northern Affairs and National Resources):: Mr. Speaker, I have not received the petition or the resolution referred to by the hon. member. I might say that I have been made aware of this suggestion largely through immediate representation by the hon. member for Marquette. From time to time representations have been made by other communities suggesting various routes, but before any action could be taken an extension of the roads in the park would be required as well as the desire on the part of the provincial government to extend its provincial road system to the park boundaries.



HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Douglas Mason Fisher: Mr. Speaker, I should like to ask the Minister of National Health and Welfare whether his speech which was given in York-Humber of which we received copies, was distributed through his own office and by employees of the Department of National Health and Welfare.


Hon. J. W. Monteith (Minister of National Health and Welfare):: Mr. Speaker, quite frankly I cannot answer that question.


Douglas Mason Fisher: Mr. Speaker, I wonder whether the minister would be prepared, in view of the contents of the speech, to obtain the answer to that question and present it to the house later.


Jay Waldo Monteith: Mr. Speaker, I shall look into the matter.

The house in committee of supply, Mr. Flynn in the chair.



DEPARTMENT OF FISHERIES

[Stage Direction]
131. Departmental administration, $473,500.
Mr. Howard:: Mr. Chairman, last evening the hon. member for Gloucester presented some information which was contained in a publication of the British Columbia fisheries association in regard to fishing, as to the volume of fish caught by the Soviet union and the size of its fleet in two parts of the world.
I have now a reference to the effect that the Soviet fishing fleet has operated in the north Pacific. Canada, along with Japan and the United States, is a signatory to the international north Pacific salmon fisheries commission, a tripartite arrangement dealing with

conservation matters in an attempt to ensure that the salmon intermingling ground, which I hope is in the Japanese area and off the coast of Canada and the United States, is protected so that immature fish are not caught.
I believe about two years ago the Soviet union fishing fleet was seen in that particular area, although its primary concern at that time, as indicated by the Department of Fisheries, was directed toward the catching of groundfish rather than salmon. At that time members of the C.C.F. group expressed concern that the Soviet fishing fleet, not being a signatory to the north Pacific salmon fisheries commission, could very easily become involved in fishing for salmon in this intermingling area, and thus participate in the destruction or depletion of salmon stocks from Canadian grounds. Also raised at that time was the possibility that China may subsequently develop a fishing fleet which could also fish in these particular waters. The desire was expressed that the Soviet union initially, and China later on, should be approached in an attempt to have them become part of the north Pacific salmon fisheries commission as signatories, in an attempt to ensure that our salmon stocks are not depleted by fishing in the intermingling areas.
There are some problems involved here which hinge upon the attitude of the United States and Canada, which follows the United States in so far as the field of diplomacy is concerned. We all know that the United States has been adamant in its refusal to recognize, either diplomatically or in any other way, the people of the republic of China; and Canada, refusing to be independent in this regard, has followed suit. I think we can all see the difficulty that could arise if eventually China did develop a fishing fleet which would fish in the particular waters to which I refer, and we subsequently desired or felt that China should become a part of the north Pacific salmon fisheries commission. We can easily see that the silly attitude of the United States, followed by Canada, could pretty well prevent any sort of discussion which would lead to China and the Soviet union becoming a part of this particular commission.
In view of the fact that Russia does have a large fishing fleet and that just a few years ago, namely in 1956, she had only two or three ships out in the Atlantic and now has somewhere in the neighbourhood of 100, if I recall the figures quoted by the hon. member for Gloucester, it is most important that this matter should be taken into consideration. Two or three years ago there was a fleet of some 40 boats of the Soviet union in the Bering strait fishing area looking for ground-fish or halibut. If Russia and China should
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develop a fishing industry, I think it is most important that they be approached with a view to becoming part of the north Pacific salmon fisheries commission in order to ensure that all classes of fish, both on the Soviet side and on the Canada-United States side, be protected and conserved to the fullest possible extent.
I wish to touch on a question in the discussion of which some people may say I am being rather critical of and unfair to certain parts of the country. I do not discuss this matter in the sense of being unfair but in order to deal with it in another way. It seems to me there is far more concentration of assistance-subsidies, grants and financial aid-to the fishing industry of the maritimes than there is to that of the west coast. For instance, I could refer to the Newfoundland bait service as a case in point. Activities under the Fisheries Prices Support Act have been primarily confined by practice to the Atlantic coast even though there is no geographical limitation to its operation. The bait freezing storage facilities also are confined pretty well to the Atlantic coast. The announcement made today by the Minister of Transport on a subject which has been discussed under fisheries estimates on a number of occasions, having to do with increased grants toward the cost of building certain types of fishing vessels such as draggers, long-liners and so on, relates to an activity that is confined to the Atlantic coast.
In introducing his estimates last night the minister said that courses for foremen in fish canneries would be conducted in the Atlantic provinces. After listening to and reading his remarks I take it that this is an activity in which the Department of Fisheries is going to participate in some way, although the minister's remarks were not clear as to just in what way; but again this is something which is confined to the Atlantic coast. The announcement of the Minister of Transport this morning of assistance to the shipbuilding industry in so far as fishing vessels are concerned indicated-from what I could grasp of it, and I stand to be corrected, because often when a long detailed statement of that nature is made one can get an incorrect impression- that the assistance in so far as fishing vessels are concerned will be confined to steel ships where those steel ships replace older or antiquated fishing vessels. And, as I mentioned earlier, the increase in the subsidy for long-liners and draggers will be confined primarily to the east coast also. I submit that this recent announcement will be of relatively little help or importance to the fishing industry on the west coast.

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The point I wish to make, Mr. Chairman, and this is not by way of complaint or suggesting that the assistance should be decreased, is that this does point up the fact that perhaps the fishing industry on the east coast is in a generally worse economic condition than the fishing industry on the west coast. I do not think we can continue to attempt to deal with this problem merely from the point of view of the subsidies, grants and assistance that have been given under the various items of legislation I have mentioned, although certainly at the moment it appears that this is a necessary thing to do in order to ensure that the fishing industry on the east coast is maintained at the highest possible level.
If we say that we are going to approach this economic difficulty by means of subsidies, grants and other assistance, then the problem will never be overcome. I think there should be a far more intense examination of the conditions of the fishing industry on the east coast to see whether some other approach cannot be made to the problem so that the fishing industry in that part of the country will become more economic, more profitable and thus be enabled to function more on its own than on government grants, subsidies and aid.
We discussed this problem to some extent on an earlier occasion. One of the ways in which the problem can be met is by the development of co-operatives. Here I am getting into another field, of course, which involves provincial governments to some extent. I mention it only in passing. The basic point is that I do not think we can continue to look at the fishing industry, or any other industry for that matter, purely from the point of view of government grants, government aid, government subsidies, government hand-outs and the like. We must take a rather different and more concerted approach to this question to see whether the industry itself can become economic to the point where it does not have to rely upon assistance of this type.
Last year the herring industry on the west coast collapsed largely because of the glut of meal and oil in the world market, and I think primarily because of the impact of the increased Peruvian production. At that time it was advocated that perhaps we should take steps to regear the herring industry to one which produced herring for food rather than for fish meal and oil. It was also advocated that we seek as well to sell on the international market cured or fresh frozen or canned herring. China was mentioned as one of the countries to which sales of this commodity might be made.

Without mentioning their names or their political stripe I can remember some people saying that this was absolutely foolish because all China was interested in buying with her scarce dollars were guns and ammunition; they were not interested in herring or food of any sort. Yet just a few days ago, as well as on another prior occasion, the Minister of Agriculture was able to announce in the house and elsewhere the sale of Canadian grain to China because of the food shortage and other factors existing in that country. If there is immense overproduction of fish meal and oil on the world market, surely to heaven we should be seeking other ways and means to develop our herring industry, and I simply use that industry as one example because it was in extreme difficulties last year. Surely we should try to develop it to the point where we produce herring for food and attempt to expand the sale of that commodity to China, just as we have done in the case of grain. Regardless of the meeting which was held in Rome, I believe, not too long ago, if we continue to push herring production into meal and oil every other country does the same thing, we are not really solving the food problem or any other problem but are simply aggravating the situation. We are merely taking steps to lessen the difficulty as much as we can without really solving the problem.
I should like to deal with one specific point about which I have had a fair amount of correspondence over the last few years, and with which I am sure the department is familiar. It has to do with what are known as reef nets and their use in the Juan de Fuca strait area. Perhaps the best way to place this matter before the committee is to refer briefly to a letter I received some time ago from Chief Edwin Underwood, chief of the East Saanich Indian band, in which he sets out the problem involved because of the prohibition of the use of reef nets. The letter reads in part as follows:
The reel net was in use on this coast long before white men came here. Its use is an hereditary right and usage has never been surrendered by the Indians in any treaty or agreement. It should always be emphasized that reef nets are not fish traps.
Prior to 1916 the white man's fish traps as well as reef nets were in common use in the waters of Juan de Fuca strait and of the gulf of Georgia in both Canadian and United States territory. In 1916 the United States, by legislation, banned fish traps in the San Juan islands group but allowed reef nets to be used as reef nets were recognized as not being traps. Reef nets are in common use today on the United States side of the boundary by white men even more than by Indians.
At the same time the Canadian government banned fish traps in Canadian waters. Reef nets were apparently classed as traps, which they are not, and were also banned.

Without getting involved in the technical argument whether a reef net causes damage so far as conservation is concerned, or whether it is in fact the same as a fish trap within the meaning of our legislation, this is the point I want to get at and it is related to the rights of our Indian people. Reef nets were used prior to 1916 and were then banned by Canada as being the same as a fish trap. However, they are being used by United States fishermen in substantially the same area. If they are destructive so far as fishing interests are concerned, then in some way or other they should also be banned by the United States in that same area. But if they are not destructive, and it has been represented to me that they are not, the use of reef nets should be allowed in that particular area, especially by the native Indian people.
I understand that this matter has been discussed with the United States authorities, and perhaps the minister will indicate at a later stage what the department's position is with respect to reef nets and what arrangements, if any, they are seeking to work out with the United States with respect to their use in this area.
I should like to make another comment that also has to do with the Indians. For many years Indians on the west coast, in any event, have always had the right to fish for food for their own consumption at any time and at any place. I think the native Indian people have been misled in this regard, because I have seen letters dated as late as last year and signed by the Minister of Fisheries or the Minister of Citizenship and Immigration which have stated specifically that this was a right of the Indian people, that it could not be touched and that was that.
When I visited the Queen Charlotte islands last fall I heard some complaints about this matter involving the placing of restrictions on fishing for pink salmon for food. The native people were complaining and were wondering what right the department had to interfere with their hereditary right to fish for food. I went to see the fisheries officer and discovered that the department has the right to do this sort of thing. I found that the native Indians do not have an hereditary right, and that in fact the right to fish is granted to them under sufferance.
The British Columbia fisheries regulations made under the Fisheries Act provide in regulation 32, which I do not intend to read, that an Indian can catch fish for food with the permission of the chief supervisor, and that this permission can be limited as to times, places, waters and types of fish, or such fishing can be prohibited entirely. I only raise this point in order to say that for
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a long period of time the native people of British Columbia have been misled into thinking they had some inalienable and untouchable right which in fact they do not have, and I think in future some attempt should be made to point out this fact to the Indians.
There is one other activity in the field of fisheries in British Columbia about which there has been some controversy in recent months and years. This matter finally culminated at least partially in a report by Dr. Sol Sinclair of Manitoba. I should like to say generally that it seems to me that the engagement of someone outside the government service, especially outside the Department of Fisheries, to conduct a survey of this nature is somewhat of an affront to the officials of the department who, as I know them, are extremely able men and very much dedicated to their work. Not only with respect to the report of Dr. Sinclair but also other similar types of reports I have often wondered why it is necessary to by-pass and to some extent slight the officials of a department who are dedicated solely to the particular field in which they work. It seems to me that in the Department of Fisheries there are people who are astute and capable enough to have made such a study, and to have arrived at recommendations or suggestions somewhat similar to those of Dr. Sinclair.
While I am on the subject of Dr. Sinclair's report on licence limitation, I should like to ask the minister to give the committee when he replies on the first item, or at a subsequent stage of his estimates, an indication of the attitude of the government with respect to the various far-reaching and important recommendations made by Dr. Sinclair. I know that the report has been in the minister's hands for only a short period of time, but I think he should be able to bring us up to date as to what the government intends to do with respect to Dr. Sinclair's recommendations. I hope, Mr. Chairman, that the same course of action with regard to this report is not taken as was taken with regard to the report of the royal commission on food prices, which recommended a federal fish marketing act. The minister said a few days ago that this recommendation would be bypassed for a period of time.
I should also like the minister to give an explanation to the committee concerning the artificial spawning grounds. I believe two or three years ago there were some experiments in this field which were primarily directed toward the pink salmon, on the understanding that these experiments would be extended to other species found on the coast. I wonder if the minister could bring us up to date on the progress being made in connection with artificial spawning grounds for all species.

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In addition, some studies were being made into the efficacy of aureomycin used as a fish preservative. I should appreciate some comments from the minister as to what has been discovered in this particular field, whether or not aureomycin has been found to be an efficacious fish preservative, keeping in mind the physiological effects of aureomycin on the consumer. While it may well be that aureomycin or some other antibiotic will be found to be a good preservative of fish, we must take into account the effect it is going to have on the consumer.
In find I am within a minute or two of my 30 minute allotment, Mr. Chairman, so perhaps I could conclude at this point. I am quite sure there will be ample opportunity during the consideration of these estimates for other specific matters to be discussed.


Mr. McQuillan:: Since I am following the hon. member for Skeena, I might say that between us we represent the major part of the coastline of British Columbia. We are, consequently, aware of most of the problems connected with the fisheries. While we do not always agree on the solutions to these problems, we are both very much concerned with them and are endeavouring to do our best to find solutions.
The Comox-Alberni constituency is probably one of the major fish producing areas of Canada. The major portion of the salmon and shellfish catches is made along the shores of Comox-Alberni. One of the major problems of the fisheries in Comox-Alberni, which probably does not exist to the same extent in the riding to the north, is the ever increasing pressure of sports fishing on the salmon population and its effect on conservation.
Some people are misled about this sports fishing catch. They seem to think something is being taken away from the commercial fishermen and is, therefore, a loss to the economy. This is not the case by any means. About 40 per cent of the total salt water sports catch is made in the waters off Comox-Alberni. Sports fishing is responsible for a tremendous revenue in connection with the tourist business. So when it comes to the question of the greatest return from the trolled salmon catch in this area, the weighted evidence is in favour of the sport catch. It is safe to say that an average of $20 is expended for gear, boats, boat rentals, etc., for every fish caught by a local sportsman. My seatmate, the hon. member for New Westminster, says I am much too conservative. He says that every time he catches a fish it costs him $250. I do not know what he spends all that money on.

It is safe, however, to say that the figure for expenditures by foreign tourists for transportation, accommodation, gear purchases, boat rentals and so on would be in the neighbourhood of $100 per fish. Sports fishing, therefore, is responsible for a large part of the income derived from tourists on Vancouver island. It is for this reason it is so important that everything possible be done to preserve and enlarge the runs of spring salmon and cohoe, particularly in the sports fishing areas.
In this connection, the department is to be congratulated upon the construction of its Robertson creek controlled spawning ground, which has proven eminently successful, and for embarking upon the construction of the project on the Big Qualicum river. These projects will not only assist materially in maintaining salmon runs, but it is hoped they will substantially increase them. I would ask the minister to have his officials make a careful appraisal of the salmon runs in the Campbell River area with a view to the development of controlled spawning projects in that area, as well as the general improvement of natural spawning grounds. The Campbell River area is famous the world over as a sports fishing area, and has been for over half a century. The revenue from tourists who come to Campbell River is tremendous. Local organizations such as the chamber of commerce and a new one recently formed called Salmon Unlimited, are rightfully concerned over what appears to them to be a depletion in the runs in that area.
Along the east coast of the island we have another river which has presented a problem for a number of years. I refer to the Punt-ledge river. I have raised this question in the house before. The present condition of this river, from a fish conservation point of view, is the result of a power development by the British Columbia power commission in 1955 and 1956. The waters off the mouth of the Puntledge and Courtenay rivers have always been famous sports fishing areas. This is one of the areas in which the famous tyee or king salmon is found. In 1957 the spring salmon run was virtually destroyed on its way to the spawning grounds. I expect the effects of this will be noticeable this year, and again there will be a lack of tyees in 1962. The department has made an effort to ensure an adequate spawn and successful seaward escapement of smolts, but this has been an expensive and, I think, a short term answer. The fisheries research branch and its officers have made an exhaustive survey and developed a plan they hope will solve the problem. I understand that several years ago the department requested the power commission to make certain installations for fish

protection. Admittedly they are expensive; I understand the cost is in the neighbourhood of $750,000, but the expenditure is minor when related to the tourist revenue of the Comox-Courtenay area.
I know it is the financial responsibility of the power commission to make the proposed installations, but I think it is also the responsibility of the federal Department of Fisheries to see that immediate action is taken. Over a year ago the B.C. power commission referred the matter to the B.C. energy board, which as yet has not rendered a decision. What authority that body has to decide on a federal matter-and this is purely a federal matter-is beyond my comprehension. I think it is time the minister insisted that the power commission get on with the job of making the necessary improvements to this river in order that the salmon runs may be protected.
I should like to make a few comments on what is now the well known, at least in British Columbia, Sinclair report. This report was prepared by Dr. Sol Sinclair at the request of the department, and a great deal [DOT]of work was involved in it. I understand that Dr. Sinclair is rated as one of the foremost economists in agriculture. In his report, as I read it, he does not give proper consideration to economics in his discussion of sport salmon fishing. As I have previously pointed *out, a salmon caught by a tourist leaves far more money in a community than one caught by a commercial fisherman. This is particularly so in the case of foreign visitors to British Columbia. Let us not delude ourselves; that is the primary reason for most of the visitors coming to this area. If our tourist industry is to survive we must continue to encourage United States visitors. They have plenty of scenery in their own country, but the one thing that will bring them to Vancouver island is the opportunity to catch a fish, or more fish than they can catch in their own waters.
Dr. Sinclair made a recommendation concerning the licensing of sports fishermen for purposes of control and conservation. I cannot support licensing in the sense of a licence which has a fee attached to it. However, if licensing is necessary for conservation purposes, licences should be issued in a manner similar to our forest service camp fire permits, where no fee is attached.
Dr. Sinclair has built up a very strong case for the limitation of the number of commercial fishing licences. However, I believe that some of the statistical material he used does not in fact give a true picture of the situation. I am always a little suspicious of statistics, because I have helped to fill out many statistical reports in my life time, and
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I must admit that I was not always too careful about giving accurate information.
As an example of what I have said, let us take the figures given at the gross and net income of a troll fisherman. These are found on page 246 of Dr. Sinclair's report. It appears obvious that anyone who has taken out a commercial licence-I believe they cost $1 at present-and sold a fish is included in the statistics used in arriving at those figures, because they show a very, very low income for the average commercial troller. Approximately 54 per cent of them are shown as selling less than $500 worth of salmon in a season.
Everyone familiar with the fishing industry of British Columbia knows that commercial licences are obtained for a number of reasons. A large number are obtained by people who are classed as moonlighters. We have had a number of labour disputes in my province in the last few years, and I know that when there is a strike in the woods, the next day you will find most of the loggers out having a good time fishing. They have taken out commercial licences and are classed as commercial fishermen.
Another group are the white collar workers and others who are fond of fishing and who hope to recoup some of the cost of their recreation by the sale of their catch. Then there are pleasure boat owners who use their fishing licences as a basis for claiming sales tax exemption on parts and material used in the maintenance of their boats as well as in the purchase of gear. Another group are the wives and dependents of fishermen, who use this as a means of avoiding income tax. Therefore to arrive at a conclusion from statistics showing the average sale of the commercial troller is hardly well founded. The categories I have mentioned represent perhaps one third of the licensed troll fishermen, and I am sure they account for the pitifully low earning figure Dr. Sinclair has arrived at in his calculations.
The recommendation he made for an increase in the cost of commercial licences and for a minimum $40 boat licensing fee may have some merit, provided special consideration is given to the native Indian fisherman. The native Indian fisherman is hardly in a position to afford a high fee and if this recommendation is ever implemented I do not think native Indian fishermen should be subjected to this kind of licence fee.
However, Dr. Sinclair's conclusion that the elimination of the itinerant fisherman will necessarily result in an increased catch by those who fish as a full-time occupation is not sound, because a very large proportion of this latter group fish in areas in which sportsmen and itinerant fishermen do not

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fish. For instance, I believe the major part of the troll catch of salmon is caught off the west coast of Vancouver island in an area where there is very, very occasional sports fishing. I further believe that the suggestion of licence limitation by direct government control should be dismissed as impracticable under any government other than a totalitarian one.


Mr. Granger:: Mr. Chairman, each year when the Minister of Fisheries brings his estimates before the committee it is a time of great interest to us who are from a province which for many, many years-ever since its discovery, in fact-depended either wholly or in part upon the fisheries. Last night I listened with great interest to the minister as he reported to the committee. I also listened with great interest to the observations of the hon. member for Gloucester, and I should like to associate myself with them.
I should like to begin by saying that any suggestions which I make involving the spending of money by the government are to be regarded as asking the government to invest rather than to give. As far as possible, the suggestions I shall make lie along the lines of investment. I do not think it is either right or wise to ask for government support simply for the sake of getting money to spend. I do believe, however, that the government should look with favour upon the spending of money which is an investment and which will result in the government getting back its bread, so to speak, with butter on it.
With respect to the encouragement of the fisheries on the Atlantic coast-or perhaps I had better address myself specifically to the fisheries in Labrador and Newfoundland-I am satisfied that the expenditure of money in certain directions would constitute an investment which would be profitable not only to the fishermen themselves, particularly on the Atlantic seaboard, but to the Canadian economy as a whole. I think there has been a tendency, perhaps an understandable one, to overlook the value of ancient industries. Fishing is one industry which we have had with us for as long as there has been a Canada. As time went by and Canada developed from the first colony of Great Britain into the great nation she is today, as central Canada became industrialized and prosperous and as western Canada began to supply food of another kind for world consumption, decreasing attention was given to what was a great industry and what still is a basic industry. It was the first industry which produced food in the new world and, in my opinion, it could become an even greater industry than it has been in the past. The population of Newfoundland is increasing, and

the population of Canada is increasing, so it is important that the old industries be revitalized and extended just as the new industries should be encouraged and extended.
With this in mind I should like to make certain suggestions applicable to the fishermen and the fishing industry in my riding; suggestions which will, I hope, receive the attention of the minister and, beyond that, sympathetic scrutiny leading eventually to the investment of funds in this industry to the greater profit of my fishermen and of the Canadian people.
Briefly, the fishing industry can be broken up into three sections, production, processing and marketing. With respect to marketing, most of the problems under this heading properly concern the Department of Trade and Commerce. I have already spoken on that subject. However, there are some aspects, particularly in connection with the processing of fish, which are the business of the Department of Fisheries, and I shall have something to say about that later.
The production of fish begins, of course, with the fishermen and depends to a large extent on whether the fishermen have the necessary gear, the necessary facilities and the necessary supplies. There are some exceptions to this rule. Last year, for instance, fish did not appear at all in certain areas but, generally speaking, the equipment which a fisherman possesses has a great deal to do with whether or not he himself can make a living. This factor is, of course, all-important. The fisherman must make a living at his vocation; if he cannot, he is not able to remain in it without receiving aid which, perhaps, is not justified.
Making aid available to help the fisherman produce is a different thing entirely, and I think government assistance should begin right there with the fisherman; assistance designed to help him produce more. Much has been done in the past along these lines, but I do think there have been some basic aspects of this question which have been overlooked.
To begin with, I might mention the matter of the fisherman's ability to purchase his equipment and supplies. It happens from time to time that a fisherman finds that his gear is worn out, his engine is old, and his boat needs to be replaced. He discovers he has not made enough money or has not been able to set aside sufficient funds over the years to make the necessary replacements. If he is to replace his boat at all he has therefore to borrow the money, to obtain credit somewhere. This is not always easy, particularly in Labrador where it is a fact that better boats and equipment would definitely mean higher production per man. So we come to the

matter of small loans for fishermen, and despite what has been done so far there is not in existence, in my opinion, any scheme by which fishermen can borrow relatively small amounts of money for the purchase of boats, engines and equipment.
In the first place, in the remote settlements and in the smaller outports where fishing is carried on as a main industry today there are not the banking facilities available, and it is difficult for fishermen to take advantage of any loan scheme which may now exist. I ask the minister to consider seriously the possibility of having a loan scheme worked out whereby fishermen who need small loans so they may improve their property and increase their production may be assisted by some scheme which would make this money more easily available. In this respect I do not believe the fisherman has the same advantage the farmer enjoys, and I maintain that the Canadian fisherman must be placed on a par with the Canadian farmer. Both are producers. Both are necessary to our economy. The fisherman of the Atlantic coast should be given an opportunity to find the necessary money in order to equip themselves to continue in business.
In his announcement earlier today concerning assistance to shipbuilding, we heard the Minister of Transport say that the present special assistance of up to $165 per gross ton in connection with the construction in Canada of fishing vessels over 45 feet in length would be increased to $250 per gross ton. While that is $50 short of what my friend the hon. member for Gloucester requested last evening, we must be pleased that it is a step in the right direction, toward implementing a policy of assistance in the building of ships. I would point out that this assistance is primarily directed to the shipbuilding industry. I say that without in any way wishing to detract from what has been said in this regard this morning. This proposed measure will provide support and assistance to the Canadian shipbuilding industry by helping fishermen buy boats in Canada, although they could perhaps buy cheaper ones outside Canada. However, I repeat that this is a step in the right direction, but suggest that more than this is needed.
This assistance applies to vessels over 45 feet in length. Many of the boats operating along the coast of my riding are much smaller than that. These boats operate in the inshore fishing industry comparatively close to shore. I understand that for economic reasons it is not practical to operate a larger boat in this field. Many fishermen will not be able to take advantage of this assistance because the majority, at least in my area, use boats smaller than the 45-foot minimum, and the
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introduction of the use of larger boats for this type of work is not feasible.
Just as the invention of traps increased fishery production during at least part of the year, the introduction of long liners in the appropriate field will do the same, but the inshore fishermen must still use small boats. To help the small operator, who must use a small boat to effectively do his work, assistance must be given toward the building of small boats as well as larger ones. The field in which these small boats operate represents a basic part of the fisheries industry, and I should ask the minister to sympathetically consider that situation.
The subject of small marine works should possibly be discussed when we are considering in detail the estimates of the Minister of Public Works. However, I think it is proper that I mention at this time that small marine works are nearly always used in the small fishing communities in the carrying out of their trade. Small wharves for fishing boats represent an essential part of the fishing trade in small communities, and there exists a need for an enlargement of the program of building these works. On this subject I should state that the community stage program, by and large, was a success. I was pleased to hear the minister say that it is intended that this program be continued, but sorry to hear that it is going to be continued on a diminished scale.
I should like to comment briefly in regard to this program. The building of community stages has provided very essential facilities for fishermen in a number of communities in Newfoundland. In addition to providing the property from which fishermen can fish this has had the tendency to bring fishermen together in groups and encouraging co-operative action on the part of the fishermen. Provision of these stages has also been of great economic benefit, because it is not easy any more for fishermen to acquire the necessary materials to build the old type fishing stages. The introduction of the new type community stage has provided the essential property for the use of fishermen.
Actually I should like to have heard that the program of building community stages was going to be continued at its former rate by the federal government, and I am sorry that this program has stopped following the provision of 20 such stages. I feel the government should have instituted a program to build perhaps 10 stages per year, carried on until all those areas which require them had been provided with the necessary stages. I feel that stages costing over $25,000 should be considered the responsibility of the federal government, and I suggest this would in no way have interfered with the ability of

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the federal and provincial governments to make joint arrangements for the building of stages.
I repeat that it is my earnest opinion that the program of building community stages, which the federal government has now completed with the building of the twentieth stage, should be continued. It is a pity that the many communities which so badly need these stages will temporarily have to do without them, and I seriously ask the minister to give further consideration to the continuance of this program in Newfoundland and Labrador in addition to the program he informed us last night had been worked out with the provincial governments.
Mr. Chairman, I should like to make some further remarks a little later, regarding the type of stage needed, but intend to refer now to the other basic requirement of fishermen. Fishermen must have bait.
Perhaps I could call it one o'clock.
At one o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 2.30 p.m.
Charles Ronald McKay Granger: Mr. Chairman, when the committee took recess at one o'clock I was endeavouring to establish the need for help to the fishermen so they could be independent and so that their production would increase. As a matter of fact, my arguments were based on the need for fishermen to be able to make a living. I pointed out that if the fisherman could not make a living at his job he could not continue at it without getting the kind of assistance which perhaps was not justified, or words to that effect. I hasten to say that by that I did not mean that fishermen should not get social assistance where needed, but I did mean that they should get the kind of aid that would make them independent in their vocation so that they would be able to maintain themselves, and not need other help.
In outlining some of the things which I thought could be done I was discussing, I think, when the committee rose, the question of bait supplies. Each year a shortage of bait cuts down the earning power of the fishermen. It is a perennial problem and I am very glad to see that this matter of bait supplies is one to which the federal Department of Fisheries has been giving attention. The bait holding units which are being installed have had a good effect. I request, of course, that this program be continued and that more of those bait holding units be

supplied to the fishing settlements in Newfoundland and in particular the fishing settlements in my riding of Grand Falls-White Bay-Labrador. I request that the minister continue to give earnest attention to the matter of bait supplies for fishermen.
Again I request that the matter of manufacturing artificial bait be given very active consideration. I will not go into details, as I have done so already in this house, save to say that if the same attention were given to developing artificial bait for codfish as has been given to the development of artificial bait for sport fishermen the problem would have been solved long ago.
With respect to salt supplies, nearly every year there is a shortage of salt in various areas. This is perhaps not so much the responsibility of the federal government as it is of the fish trade itself and the fish merchants themselves. Although in these remarks I am trying to point out what I think are the duties of the federal government, I would not want to leave the impression that I think the whole fishery business should be run by the federal government. I think of the industry itself, the commercial interests which exploit the fisheries. They have their duties also. I would ask the federal government to keep on eye on the matter of salt supplies as well as bait supplies and give what assistance they can.
With respect to the processing of fish, there seems to be an overproduction, if anything, or perhaps an out of balance production of heavy salted fish, and this fish is sold in a highly competitive market. At the same time a good market exists for light salted fish. I do not believe we are producing enough light salted fish to fill the requirements of this market. In the old days light salted fish was produced chiefly by hand labour. Of course, it is unthinkable to consider going back to the old ways of making fish when those who made the fish were paid very little for their work. Today, heavy salted fish is chiefly made in mechanical driers. My plea is for a drier which will produce light salted fish.
My understanding is that one of the reasons why light salted fish cannot be made artificially is that it can be kept only a comparatively short time before going bad. In other words, when a fisherman light salts his fish he has to get rid of it fairly quickly in order for it to be made or else it will spoil. That being so, it would seem to indicate that cool rooms built in connection with community stages might be the answer. A community stage would be a unit consisting of a cool room, a bait holding unit and, of course, the stage itself. I said before lunch that I wanted to come back to the matter of community stages and one of the

points I had in mind was that a community stage program with the necessary cool rooms and bait holding units is necessary if we are to exploit the light salted fish business properly. It seems to be evident that there is a market for light salted fish, a market that is larger and more readily available than are the markets for heavy salted fish.
With respect to community stages on the Labrador, in addition to those built for Labrador residents I should also like to see the experiment tried of a community stage complete with a bunkhouse and dining facilities so that crews from elsewhere could spend the summer fishing on the coast and then sell to collectors, the fish caught and stored in the stage. That could very well be one way in which the Labrador fishery could be revitalized. Certainly Labrador offers some of the most prolific fishing grounds in Canada and Canada's are the best in the world.
There is no need for me to point out again how other nations are profiting by using the waters off Canada's coast. The Labrador floater fishery, which almost disappeared several years ago, shows sign of reviving and I believe that a new Labrador fishery tailored to meet present-day requirements is a distinct possibility. It is something that the minister could very well look into and I believe it would be rewarding to the fishermen as well as being of great benefit to the Canadian economy.
I should like to express appreciation for the work the minister's department is doing in research and again make a request for further study of the artificial drying of light salted fish. I believe this is absolutely essential. If we do not keep these markets then the markets will disappear. If the product to which they have been accustomed in the past is kept away from them long enough, the demand for it will completely cease to exist. It would be really tragic if we were to lose these historic markets, and if we do not develop the kind of product which the market wants somebody else is going to do it and we may well lose the market forever.
The question of what to do with respect to the fisheries is, I think, fairly easily answered. There have been commissions from time immemorial that have looked into the matter of what is wrong with the fisheries and some of these commissions have produced very valuable information. The last one was the Walsh commission in 1952, I believe, and as a result of that commission action was forthcoming. I ask the minister to keep an eye on the possibilities for development based on the knowledge he already has and so that he may acquire further knowledge I invite him and his officials to visit Labrador and
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northern Newfoundland personally as soon as possible. When he has assessed what is needed, when he has acquired the necessary information, which is already at his disposal, all I ask him to do is to put into effect the policies that are needed. Some of these policies are simple. Some of them are very basic. They have to do with enabling the fishermen to produce more fish in order to make more money. Some of these policies, like the development or continuation of research, are more involved, but none of the problems is insurmountable. All are problems that can be met, and certainly with a knowledge of what is needed the will to do must be forthcoming.
I should also like to mention the presence of a Russian icebreaker at the seal fishery this year. This is a sign of the times, a sign of the increasing competition with which we are going to be faced in every phase of the fishing industry. It probably would not be a bad idea for us to consider at the appropriate time the advisability of having icebreakers available for the assistance of Canadian sealing ships.
I believe that the government of Newfoundland is experimenting at present with a new type of trawler. While I understand it is hoped that the boat will be self-sustaining, I might suggest to the minister in passing that as the knowledge gained will be available to all of Canada the federal government might consider sharing the loss with the province in the event there is a loss.
Finally, may I again emphasize the necessity of the investment of comparatively small sums of money so that the fishery can be more profitable for all concerned, so that fishermen will be more independent, so that fish products will bring a greater profit to Canada and so that the industry will grow faster than it has been and in proportion to our population and our economic needs to the greater profit of the fishermen of Canada and the people of Canada generally.


Mr. Crouse:: Mr. Chairman, as the representative from Queens-Lunenburg, one of the oldest and most famous fishing constituencies in Nova Scotia, it is with pleasure that I rise to participate in the debate on the fisheries estimates. My first words will be to commend the minister for the conscientious manner in which he is administering the affairs of his department. The fish and shellfish resources that abound off the coasts of Canada make a great material contribution to our national economy and to the food supplies of this nation and other countries, and they merit continual attention not only from the government but from private agencies as well.

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The fishing industry is soundly based upon a living, constantly renewing source of national wealth which, with proper management and careful planning, can be maintained at its present level and greatly enlarged. However, if this resource is neglected or overexploited the reverse is true, and this presents Canadian fishermen with a constant problem. Supervision of this great resource is a governmental responsibility but in order to achieve the maximum results co-operation is required from all those engaged in the fishing industry, the fishermen, fishing companies, processors, dealers and the public at large.
The Department of Fisheries has made great forward strides under the present minister, with special emphasis on the fisheries research board. This progressive arm of the fisheries department has been conducting studies on oceanography and the fisheries, and I believe the information gained will be invaluable to Canada's fishermen.
We too easily forget that the earth's surface is only one quarter land and that almost three quarters is covered by water. Of the land quarter only about one half is habitable, and much less than that is cultivatable. On the habitable portion of the land, there now live about three billion people, approximately one billion more than lived here 50 years ago. Experts estimate at present rates of population growth there will be four billion in 15 years, and six billion or twice the present world population in a span of only 40 years. These numerous new people will need both space and food. If the world is to be called upon to provide additional food for another billion people in 15 years, a more readily available source than bringing new land under cultivation will almost certainly have to be found. The only large and as yet not fully explored source of food is the ocean. Recent and continuing heavy capital investment in large modern highly mechanized fishing fleets and in research and oceanographic vessels by the United Kingdom, the United States, Russia, France, Japan and indeed by most of the countries of the world seems to indicate that the race for animal protein is already under way.
We are carrying out similar studies in Canada. In fact, the Canadian committee on oceanography was reorganized in December 1959. From studies already made it would appear the great future developments in marine fisheries lie in three directions. One is to develop fish culture or fish farming. The second is to make fuller use and to take some of the guesswork out of the bank and ground-fish industry with which we are already familiar, and the third is to separate the productive from the non-productive areas on the 
many fishing banks that exist on our continental shelf. With the help of other governmental departments, these broader aspects of oceanography are no longer frightening and positive programs can be laid down and in due course carried out.
One of the prominent examples of fish farming is the experimental work carried out by the department with several imported varieties of oysters, seeking a breed which could survive in Nova Scotia waters. Efforts to plant Prince Edward Island oysters in the Atlantic coast regions of Nova Scotia have not been too successful. I understand from reports that there was extremely heavy mortality in the St. Margaret bay area, though some oysters did grow fairly well at coves near Chester. The reason these tests were not entirely successful could well be due to the fact water temperatures on the Atlantic coast are much colder than in the sheltered Northumberland strait area, and I suggest the department continue with these tests by bringing in oysters that are accustomed to colder waters.
Without question, any expenditure by the fisheries department in an effort to re-establish the oyster fishery depleted by the epidemic oyster disease some years ago can be readily justified because of the great economic benefits to the province, and the nation as a whole. The fact that this type of fishery is within three miles of our coast and will be of direct value to Canadian fishermen should be considered. I often wonder if Canadian fishermen realize the tremendous potential in the oyster fishery.
In 1960 for example we exported to the United Kingdom, British Guiana, St. Pierre and the United States a total of 19,200 pounds valued at $5,443. However, during the same period we imported from Hong Kong, Japan and the United States a total of 71,743 gallons of oysters weighing approximately 10 pounds per gallon, valued at $503,770. In other words, there is a market for over half a million dollars worth of oysters right here in Canada and these shellfish lend themselves well to farming. Plans are available whereby fishermen living along the coast could build cement holding ponds and by pumping in sea water under controlled temperatures, and using proper feeding plans, a suitable oyster harvest could be secured. Oyster seed farming is biologically possible if oyster seed of disease resistant strain is used, as proved on Conway narrows flats in Prince Edward Island, the department's experimental area.
This calls for some forethought and planning, but this could be developed for the benefit of our inshore fishermen and could provide much needed revenue and employment in some of our Atlantic coast regions. The

market potential is not only great in Canada, but this program of oyster farming, if developed, could provide us with more oysters for export as the market for this succulent seafood is almost unlimited and this would improve our imbalance in trade. I believe the Bras d'Or lakes of Cape Breton, for example, with an entrance and exit to the sea, and where the water is warm enough to encourage excellent growth in a sheltered area, could be turned into one gigantic oyster farm bringing much needed income to the citizens of that area.
While commending the minister and the scientists of the research board for their efforts to replenish the oyster stocks in Nova Scotia, I would also urge they give equal attention to developing and restocking our clam beds along the Atlantic coast and our scallop beds in the bay of Fundy. During the past few years it has been found necessary to curtail clam digging in many areas of the Atlantic provinces because of the toxic effect this tasty seafood had on the consuming public, due to water pollution. As a result, many of our clam canning factories have been forced to close or seriously curtail their production, resulting in a further loss of income to our inshore fishermen. We see Japanese canned clams in constantly increasing quantities in the food stores throughout Canada, and to see this shellfish packed in a distant country offered for sale in the Atlantic provinces is the height of irony.
The fact that Japan, with its teeming millions in need of food, can export clams to Canada is indicative that we as a nation have been negligent in the care of our shellfish resources. Their success is not due to discoveries of which we are unaware, but due to their insistence in keeping up to date methods of development, production, inspection and conservation. What is the problem affecting our clam industry? In certain areas water pollution has been quite heavy, and as most people know shellfish will pick up and concentrate germs. However, it is equally true that contaminated shellfish will readily cleanse themselves in clean water. This is cheap and handy enough, but to ensure and certify that this has been done requires testing, inspection and market control and I would suggest this work could be undertaken by the officers of the fisheries research board working in conjunction with the fisheries officers in the Atlantic coast areas.
In addition, some encouragement should be given our inshore fishermen to invest in a mechanical clam digger or shellfish harvester. These are used with great success along the coast of Maine, and the fisheries industrial development service working in co-operation with the fisheries research board perfected 90205-6-299
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a shellfish harvester called the "Cyprina" which they found not only good for clam digging but also suitable for harvesting "bedding size" oysters. The plans for this type of machine are readily available, the market for the clams is here in Canada as well as in the United States, and I believe this type of fishery merits a second look not only by our inshore fishermen but also by government officials.
Just what are the possibilities? While Canada's clam production last year amounted to $781,324 we still imported from Japan canned clams and crabmeat, another shellfish that could be processed in Canada, to a value of $482,958. It is true our clam production has been hampered due to contamination in certain areas. However, these contaminated shellfish further point up the need to accelerate construction of municipal and industrial waste treatment works to alleviate the evident destruction and waste of Canada's marine resources. It is a somewhat sobering thought that in the event of an atomic war the ocean could well be the only source of uncontaminated food supplies. The ocean is mankind's largest remaining source of edible protein and it cannot continue to be considered as an unlimited disposal dump for atomic wastes and the products of civilization.
The same conditions that apply to oysters and clams apply to a somewhat lesser degree to our scallop beds. This industry has grown in the past six years in Nova Scotia from almost nothing to a landed value in excess of $2 million. Some 25 scallop draggers carrying crews of from 15 to 20 men each operate on the offshore banks at Georges and St. Pierre. This is a deepsea operation and when landed these scallops are all inspected by fisheries' officers prior to shipment.
However, not too many years ago the bay of Fundy produced considerable scallops and these were landed at Digby, Nova Scotia. In 1927, for example, total production in Canada amounted to 39,000 barrels, and 37,500 barrels came from Digby. Due to overfishing and improper conservation practices this fishery has declined in recent years, creating a considerable loss of revenue for our inshore or Digby scallop draggers.
When discussing shellfisheries we must not forget lobsters, which had landed value last year in the Atlantic provinces of $18,041,000. However, here again is a commodity that is still in great demand not only in Canada but also in the United States and European countries, with markets apparently unlimited.
The export value of Canada's lobster catch last year amounted to $20,149,974. While this is a significant amount, we are only scratching the surface. I believe greater emphasis should be placed upon increasing the amount

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of lobsters along our shores by establishing artificial breeding ponds. While this method of increasing available supplies was tried some years ago, I think around 1913 and 1914, at Long Beach pond and Gabarus pond in Nova Scotia without promising results, I believe that with our present scientific knowledge we could establish with a greater degree of success artificial breeding ponds for lobsters so that our bays and inlets could be restocked along the coast of Nova Scotia.
At the present time we are spending large amounts of money on research and conservation methods on the high seas with regard to our groundfish industry. The A. T. Cameron, a 177-foot research ship is searching out new areas for our ground fishing fleet. While I am vitally interested in all aspects of our fisheries development, I would point out that any new fishing areas discovered by the Cameron will only be useful in the future when we have larger ships than those presently in existence.
Our efforts to conserve the small fish by establishing net mesh regulations are also questionable as there is a growing feeling among Canadian fishermen that these regulations are not being followed by fishermen of other nations.
In support of that statement I would quote a list of prices taken from the Halifax Chronicle-Herald last week. These prices are for codfish in Boston. They quote large cod at 5 cents per pound, medium cod at 5.75 cents per pound, and cod scrod-that is, 2J pounds and under-at 5.95 cents per pound. Here the emphasis is placed on the small fish.
In view of our inability to enforce conservation measures beyond the three-mile limit of our coasts I would urge upon the government that we give more thought to developing our shellfish industries and those ground fisheries that come within the jurisdiction of the Canadian government.
I note, for example, the amount of the contribution this year toward fisheries research is only $25,000, as in the previous year, while the amount for the construction of departmental vessels has been increased from $200,000 to $980,000. For the reasons I have mentioned I believe more of this money should be diverted to fisheries research.
To encourage and provide an area for these developments I would suggest to the government that we give consideration to establishing base lines from cape St. Mary near Mateghan past Grand Manan island to the New Brunswick border and class the bay of Fundy area as a territorial sea in which fishing is restricted to ships of Canadian registry.

A similar base line should be drawn from Cape North in Cape Breton to Port Aux Basques, Newfoundland, and the gulf of St. Lawrence classed as a territorial sea, thereby providing an area for shellfish and certain groundfish conservation practices that would come under Canadian government control and provide an income for our inshore fishermen in the Cape Breton area as well as those in Prince Edward Island, the Gaspe coast, the Magdalen islands and part of the coast of Newfoundland.
I do not believe this action would receive any serious criticism internationally as Canada is bordered by three vast oceans, the Atlantic in the east, the Pacific in the west and the Arctic in the north, a total coast line of approximately 60,000 miles in which other nations have unlimited fishing rights. It would also have no effect on those countries which are presently fishing extensively on our east coast banks.
However, in the areas I have mentioned, where the base line would provide a small territorial sea, there are many fishermen and communities which depend principally for their livelihood on the fishing industry. We could carry out in these areas proper conservation practices and assist in the redevelopment of our shellfish industries, which could be of considerable economic importance not only to the Atlantic provinces but to all Canada.
With further reference to fish farming, I believe there is an increasing demand for more sport fishing particularly near urban areas, with the added possibility of developing a commercial product of value. I believe this matter was discussed at the fourteenth meeting of the Canadian committee on freshwater fisheries research, sponsored by the fisheries research board. I believe farm fish ponds and fisheries management should be further encouraged in Canada.
At the present time there are thousands of ponds, mostly in Quebec and Ontario, though we have some in the maritimes. In fact there is one in my riding near Lunenburg. The chief product of these fish farms is trout and the pressure on natural waters and the demand for more sport fishing is creating a situation in Canada favourable to the further development of ponds. There is also a growing commercial market for rainbow and brook trout, which at present are being imported from Japan and Denmark in increasing quantities. In fact, at the present time a 10-oz. package of rainbow trout packaged in Denmark is retailing in Ottawa for 57 cents.
I submit there is an opportunity in this industry for energetic Canadians, and I would urge the fisheries department to give every encouragement to this type of development.

Along the same lines I would urge that further consideration be given to the restocking of our rivers and lakes with salmon. In my riding we have fair salmon fishing on the Medway river in Queens county and the Lahave river in Lunenburg county but steps should be taken to build up the salmon runs not only in these rivers but in Martin river and Middle river and others in Lunenburg and Queens counties. This would further encourage tourists to visit Nova Scotia, and thereby assist in strengthening the economy of our province.
The recent loss of 17 fishermen by drowning when their long-liners sank because of high winds and heavy seas off the coast of Nova Scotia should cause some concern to the minister and officials of his department who have encouraged the construction through subsidies of this type of craft. These men were the very best and most aggressive or they would not have been where they were, and their loss leaves a void that will never be filled.
While long-liners were never intended to operate over 100 miles at sea on our offshore banks, I personally believe there is a structural weakness in these craft which would bear examination. The large wheelhouse placed amidships which covers the engine and fish hauler has been designed more as a shelter from the normal elements than as an integral part of the hull. When struck by a heavy sea this wheelhouse is quickly destroyed leaving the long-liner exposed to the elements and possible flooding when the next sea strikes. It is worthy of note that 65-foot draggers, which are completed decked over, and also ships of the schooner type between 75 and 100 feet in length successfully weathered this particular storm. As a matter of fact, the schooner type design which made the sailing ship Bluenose and the town of Lunenburg famous, has never been surpassed in seaworthiness. I would ask the minister and his officials to give urgent consideration to these facts and to the possibility of improving the long-liner design.
A complete study of the entire assistance program would in fact be most desirable. According to figures supplied by the economics service, Department of Fisheries, for the four year average, 1955 to 1958 inclusive, Nova Scotia draggers averaging 65 feet in length spent 179 days at sea per year. Here my remarks coincide to a considerable extent with those made last evening by the hon. member for Gloucester which would indicate we have our fishermen's interest very much at heart. During this period when the 65-foot draggers operated, actual fishing hours amounted to only 1,433, or less than 60 days out of a year's total of 365. This gives an indication 90205-6-299i
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of the seasonal type of operation carried out by the six man crew on a 65-foot dragger and explains the reason for the marginal earnings shared by these fishermen.
It is evident these ships are not large enough to operate in the fisheries on a year round basis, and larger ships are required not only for the safety of men's lives but also to provide steadier employment at sea and ashore. This requires heavier capital investment, and in order to obtain this capital the fisherman must receive a better price for his fish. Of the species of fish landed it is interesting to note that cod, haddock and flounders comprise over 81 per cent of the total. During this period haddock landed averaged 3.5 cents per pound, codfish three cents per pound and flounders slightly better than 3.2 cents per pound. It should be pointed out that though fancy grades bring better prices than those previously mentioned, the scrod grades, that is to say, fish of two and a half pounds and under, lower the total average.
It has been suggested by many fishermen that the present price which has remained fairly constant for the past 15 years be raised by one cent per pound. This would make the difference between a marginal operation, and one economically sound and capable of supporting the fishermen and their families and supplying capital for larger ships. The next question is, of course, whether the market can stand this price increase. A recent survey in the Ottawa supermarkets on the three species mentioned showed frozen haddock in one pound packages retailing at 49 cents per pound, frozen cod at 37 cents per pound and frozen sole at 45 cents per pound. As it takes three pounds of fish to make one pound of fillets, an increase of one cent to the fishermen would increase these prices by three cents to the consumer. Even with this increase these seafoods which provide much needed vitamins and minerals to mankind would still be much lower in price than the trimmings from the slaughterhouse tables which are selling as hot dogs or all beef franks at 59 to 63 cents per pound.
An increase of one cent per pound on haddock, cod and sole over present prices would also go a long way toward providing further additional capital for use by our fishermen on the construction of new ships. While I realize much of our production is sold in the United States market, and we must compete with world exporters, I believe every effort should be made to provide at least this one cent per pound increase to our fishermen. To do this, we must encourage greater consumption of fish among Canadians generally. At present the average Canadian consumes 142 pounds of beef per year, 72 pounds of

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poultry but only 13 pounds of fish or a little better than one pound per month. This despite the fact that fish protein has a high biological value in terms of body growth and repair. Fish protein is complete and balanced nutritionally. Fish protein is easily digested and readily available to the body. Nutritionally, fish are a gold mine of dietetically valuable minerals and of other inorganic compounds. It is now well recognized the serum cholesterol level in man can be lowered by reduction in fat intake, or by judicious substitution of one form of dietary fat for another.
In fish we have a uniquely valuable food; one that combines the biological value unique to the proteins of the animal kingdom, with the healthful soft fats unique to the plant kingdom, and which assist in the prevention of arteriosclerosis, a disease of the arteries of the heart. In addition to its health values, fish is available in a wide variety of flavours, textures and market forms. To the economy minded, fish fillets provide 100 per cent protein with no fat or bone to waste. It is readily available and easily prepared, and I trust it will find increased acceptance among our Canadian consumers thus providing a much needed boost to our east coast fishing communities, the secondary industries allied with fishing, and a strengthening of our entire Atlantic area economy.


Harold Edward Winch: 
Mr. Drysdale:: Mr. Chairman, would the hon. member permit a question? Has the hon. member any idea of the price at which Norway is selling its herring to Japan?


Harold Edward Winch: No, I have not the slightest idea. I do not know the price of the kazanoko, but I do know that the coast of British Columbia is closer to Japan than is Norway, and that with a little research, and perhaps assistance in regard to trade markets, with the development of this new product, perhaps our fleet could have been operating instead of being out of work the major part of last year.
We have a similar difficulty in respect of our whaling fleet. My friend the hon. member for Burnaby-Richmond can smile and laugh, but these are grave situations which should be drawn to the attention of the minister and his department.


John Andrew W. Drysdale: Mr. Chairman, on a question of privilege; I was not smiling at the hon. member, but smiling at the fact that he has not bothered to produce the facts. If red China intended to purchase herring from Canada in the way it is now purchasing wheat, it would not hesitate to do so. The hon. member has not bothered to produce any factual information in this regard, and that is why I was smiling.


Harold Edward Winch: Mr. Chairman, I am interested in the establishment of an aggressive policy on the part of the government of Canada to sell the products of Canada. I do not believe
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we should wait, in this buyer's market, for other countries to come to Canada to purchase these products, particularly in view of the difficulties with which the fisheries industries are now faced. My friend the hon. member for Burnaby-Richmond, as a Conservative, is quite prepared to sit back and wait for these countries to come to Canada, but in this way we are not going to maintain our export markets. I suggest that we must be aggressive in our attempts to find new markets.
I should also like to direct the minister's attention to the fact that our whaling fleet was not out last year, and I understand it is not going out this year. I feel that some attention should be given to this grave situation.
I should also like to refer for a moment or two, to the matter of conservation. What has this government done in regard to conservation of our fisheries products? I asked this same question of the Minister of Fisheries last year, and he replied that he was keenly interested and concerned, but as yet we have not heard one word in the way of a solution to this problem. The Department of Fisheries, to my knowledge, has put forward no ideas at all, nor offered any help in the solution of this problem.
I suggest that the province of British Columbia, particularly its fishing industry, has been let down by this government. The residents of British Columbia feel that the fishing industry there should not be considered by this government as an illegitimate child. We feel that this industry is of vital importance to the peoples of the Pacific coast and that every assistance should be given to the solving of its problems.
Mr. Chairman, I should now like to proceed to discuss a subject of importance to the peoples of Canada from the Pacific to the Atlantic, and I refer to conservation and the methods of killing in respect of whales and harp seals. I have been very interested in noting that only one hon. member from Newfoundland has made any mention at all of the sealing industry. Mention was made of the fact that a Russian icebreaker was at the icefields and that perhaps Canada might do something of a similar nature.
I want to speak on this issue from a different angle. Knowing that these estimates were coming up, I spent a most interesting two or three days a short time ago in reading the various issues in the past year of that most remarkable magazine, the Canadian Audubon, and the writings of that world authority, Dr. Harry R. Lillie. He had a most interesting article in the Daily Telegraph of Great Britain on March 19, 1960. It was


Mr. McGralh:: He subscribes to the hon. gentleman's political theories.


Harold Edward Winch: I did not catch that.


James Aloysius McGrath: I interjected that the gentleman to whom the hon. member referred subscribes to his political theories.


Harold Edward Winch: To mine?


James Aloysius McGrath: Yes.


Harold Edward Winch: I did not know that before. He is even more worthy of notice than I had understood.


John Andrew W. Drysdale: You had better read it carefully.


Harold Edward Winch: I have read it very carefully. I say that the author lives in St. John's Newfoundland, and I am certain that the hon. member who interjected will admit that his long interest and knowledge of this very matter, tied in with the report of Dr. Lillie, should commend the article to the committee. What does the article say? It is something that in which everyone should be interested. May I just make a brief reference to it because it has to do not only with the methods of killing but also with conservation. The article reads in part:
The seal hunt is an annual adventure in the icefields to the north of Newfoundland. Full of hardship, danger and cruelty, it has been going on yearly for a century and a half, but is now near its final act, as the once great seal herds of the northwest Atlantic are relentlessly hounded to destruction by motor ships, aircraft and helicopters.
The article goes on:
Traditional toast drunk in St. John's to departing sealers is "Bloody decks, and many of them!" This is symbolic of the barbarity with which the seal hunt is conducted. Dr. Joseph Cunningham, the world-famous small boat sailor, who "went to the ice" in 1955,-
I believe this is the term used in Newfoundland. Dr. Cunningham went to the ice and found the seal hunt utterly degrading and cruel. The article goes on to point out what is happening to the seals off the coast of Newfoundland as they go north. He gives the figures of the Newfoundland kill. From 1831 to 1840 it was 470,000 yearly; from 1931 to 1939 it had fallen to 170,000 yearly; and now it is below this figure.
I have an interest in this particular matter for two reasons. I have a very keen interest in it because I take a great deal of pride in the fact that my late father introduced me to this question of humane killing many years ago. He himself never killed an animal or shot a bird; neither have I. That was the education he gave me; only kill because of necessity. But if because of economic necessity we have to kill, then let us do two things: one, remember conservation in the interests

of the economy; and, two, kill in the most humane way that science can provide.
I wanted to raise, first, this question of the fishing industry in British Columbia and the problems that we are facing there. It is my belief, as I said, regretfully, that there is not being carried out the research that is required to maintain the various segments of the fishing industry of British Columbia. Second, on the basis of the opinions expressed by authorities in British Columbia keenly interested in whale conservation and authorities in Newfoundland interested in seal conservation and not on the basis of personal knowledge, I submit that serious consideration should be given to this matter and we should be provided with information as to what the department is doing with regard to this matter which is of such great importance to British Columbia and Newfoundland. It is not enough to get an immediate return by killing now. Our great interest should be to profit from our resources in the best way we can, whether they be on land or in the sea, but at the same time to conserve them for those who come after us.
Irrespective of whether we are Conservatives, Liberals or C.C.F.'ers I think the great responsibility of a member of parliament as an adult Canadian citizen is to see that we hand on to those who come after us a heritage which is greater and fuller because it has passed through our hands. That is the principle I have tried to enunciate this afternoon.


John Andrew W. Drysdale: Will the hon. member permit a question before he resumes his seat? I think it would be safe to say that we are ad idem on the question of conservation, but I was wondering whether the hon. member could explain why he thinks electric harpooning is more humane than the present method which I understand involves a detonation when the harpoon hits the whale.


Harold Edward Winch: I should like the hon. member to read the authorities I have been reading this past week, people from Newfoundland, the United Kingdom and Norway. According to all the information I have been able to gather, the exploding harpoon now used does not necessarily cause instant stunning because as a rule it hits the intestines and does not kill the nerve blocks. On the other hand, the electric harpoon immediately kills all the nerve blocks. According to all the reports I have read, it has been tested with excellent success. The request from the Audubon Society of Canada is that Canada interest itself in this matter and take leadership on the international commission-I have forgetten its name for the moment-in seeing that the most effective method of killing is used. That
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is my information from my reading. If I had the time I could explain further what happens with the explosion of a bomb harpoon inside a whale.


James Aloysius McGrath: Mr. Chairman, I should like to speak on the estimates of the minister's department with particular emphasis on what I and many of us from the east consider to be a very perplexing and serious problem facing Canada's oldest industry. I refer particularly to the salt fish industry. As briefly as I can, I should like to tie in my remarks concerning the problems of the salt fish industry with the work of the fisheries research board. I realize that all too often people speaking on this subject tend to generalize and to oversimplify, and I hope that this afternoon I will not be too guilty of generalization, bearing in mind at all times that I do not have a really technical knowledge of this very complex subject.
Before doing so, Mr. Chairman, I should like to refer to what the minister had to say in relation to the community stage program. I too share the views of hon. members who have spoken in the debate, and state without reservation that in my opinion the community stage program should be enlarged and stepped up with all possible haste because in my view it is measures such as this that will assist in the salvation of the now dying salt fish industry.
The minister also referred in his remarks to the fact that last year was a good year for the Canadian salt fish industry, and the reason he stated it was a good year was the fact that European stocks were low. I think you have here the real weakness of the Canadian salt fish industry, the fact that our markets for this product depend upon the stocks or supplies of the European markets. It is a common fact that most of the European markets are supplied generally by their own subsidized fleets operating in most cases in Canadian waters.
To illustrate this, in 1959 world production of salt codfish was, I believe, approximately 350,000 tons. The Canadian share of that production was about 45,000 tons. I think it is generally recognized, as I said before, that the majority of this fish is caught and sometimes salted in the waters immediately oil Canada's east coast.
In relation to the problem of marketing and the sale of our salt codfish, one cannot escape reference to the system of marketing prevailing in the industry. The Newfoundland associated fish exporters limited, generally known as NAFEL, was abolished a few years ago by virtue of the fact that its exclusive licence as the marketing agency from the federal government had expired. This agency

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was started by the previous administration of Newfoundland, that is, the government that existed prior to union, in order to correct a situation in the industry that was having serious repercussions around the world in the traditional markets for Newfoundland salt codfish. This situation came about by virtue of the fact that there was cutthroat competition and inconsistency in quality arising out of this competition, all to the detriment of the salt fish industry.
While there are many critics of this organization, there are many people who say it should have been enlarged to take in all of the east coast fishing industry including the Gaspe, Nova Scotia and New Brunswick. They say that it should have been set up as the marketing agency for all this area. I am not going to argue the merits or demerits of this cartel, because that is what it was, a private cartel with the blessing of the government, but I will say that just as a need exists in agriculture for a central marketing agency to dispose of Canadian agricultural products, more specifically wheat, in order to ensure stability in that industry and a stable return to the farmer, equally in my opinion the same arguments can be applied to the fishing industry.
I think that this fact is too often forgotten. By the same token, I believe consideration should be given to investigating the possibilities of the Department of Fisheries taking greater responsibility for the disposal of Canadian fisheries production, particularly of Canadian salt fish production.
There have been references to various types of salt fish, the heavy salted fish that is cured in Nova Scotia. However, little reference has been made to the light salted codfish, cured primarily by sun drying, for sale in the traditional markets that prefer this particular type of codfish. For one reason or another, this part of the industry has practically died. I think this is a place where the research board has a very important role to assume. It is a fact that in France, for example, a means has been devised for desalting heavy salted fish. The resultant product is even called "Newfoundland type" codfish. This is the type of fish they prefer.
Of course the problem, Mr. Chairman, concerns the method of drying. I feel that the fisheries research board is aware of this problem and is attempting to cure it. However, I do not think the industry is aware of the work of the research board. I hope I am not trespassing on the sensitivities of the hon. member for Bonavista-Twillingate, but I say that the experimental station at Valleyfield, Bon-avista, does not serve the purpose for which it was intended because it is too far away from the main plants that produce salt codfish.

After all, if it is not accessible to the industry it is logical to conclude it is not functioning as it was intended to function.


John Whitney Pickersgill: May I ask the hon. gentleman a question? May I ask the hon. gentleman if he has ever found the time to visit this research station before passing judgment upon it?


James Aloysius McGrath: Unfortunately I have not, because Valleyfield is so isolated and so far away from the main centres of the island that I have been unable to go there. It is only a few years since the road was put through to Valleyfield. This is the reason why I have never been there. I grant that the establishment at Valleyfield is adequate in every way for the purpose for which it was intended. My contention is that it cannot serve any useful function unless it is close to the main processors of salt codfish. As everybody knows, they are located around the southern part of Newfoundland as for example in the constituency of my hon. friend from Burin-Burgeo.
I am not going into the reasons for the establishment of this station at Valleyfield because I think hon. members can draw their own conclusions about that. I will say that this points up what, in my mind, is the weakness in the research aspect of the Department of Fisheries; the fisheries research board. I feel that if the plant at Valleyfield, or one similar to the one at Valleyfield, were located in a more practical location great benefit could be derived from it.
Referring generally to the question of the fisheries research board, I may say in my opinion this board has lost sight of its main purpose, namely to do the type of research, scientific and technological, that could be practically applied to the fishing industry. I do not believe this is being done. I should like to quote from a speech delivered by a member of this board in Halifax, I believe, not long ago. He said:
Be that as it may-here are the views of a member of the Canadian fishing industry who became a member of this board one year ago. In that period it has become apparent to me that the board lived and worked in a world apart from industry.
I believe that this is a very serious statement, and one that deserves the closest study. I feel it is essential that money be spent on scientific research but that the results of this research be directed toward the practical, everyday use in the fishing industry. I do not believe that it is enough for the scientists to examine rare species of fish. This may be a scientific end, in itself, but I say that unless the work of the fisheries research board can be translated practically to the industry, then it is not justified.

There is no justification, then, for the public money that is spent in support of this board. I believe there is room for research and more research, but let us put basic things first. I believe that the results of this research must be more practically applied in order to achieve its purpose.
I feel, for instance, that there should be closer liaison between the industry and the fisheries research board. I do not think it is enough to publish scientific papers because after all these have to be translated into lay terms that the fishermen can understand and that the industry can understand. When the minister replies, I should like him to deal with some of these points because I feel they are very important and basic to the future of the fishing industry.
In conclusion, I would sum up by saying it is my firm belief that, first, there should be a serious reappraisal of the policy of the Department of Fisheries with regard to the salt fish industry; second, I believe the Department of Fisheries should assume a greater role in the marketing of our fisheries production; third, I think the fisheries research board should re-examine just exactly what its function is and try to translate that function into practical terms for the day to day use of our fishermen.


Mr. Tucker:: Mr. Chairman, as far as the province of Newfoundland is concerned, we are today discussing the estimates of one of the most important departments of government. Newfoundland is an ideal base for fishing, not only for the Newfoundland fishermen but also for the British, French, Portuguese, Russians, Spaniards and others who come to the island every year with their fleets of ships.
These foreign fishermen, with their advanced methods and superior vessels, are fast outstripping the Newfoundland fishermen in methods of catching and curing fish. Consequently they can produce better fish at cheaper prices than Newfoundlanders.
At the present time there are approximately 22,000 persons engaged in the fishery ashore and afloat along our 6,000 miles of coastline. We have approximately 60 fish processing establishments and about 18 freezing plants. The industry ranks third in importance as far as the island's economy is concerned, and its products amount to $32 million yearly.
Newfoundland's main markets for salt fish were the British West Indies, Brazil, Greece, Italy, Jamaica, Portugal, Spain, Puerto Rico, Cuba and other areas in the Caribbean. All these markets are gradually disappearing. Many of these countries are now sending their own fishing fleets to fish on our Grand Banks off the coast of Newfoundland. This decline in our markets has taken place dur-90205-6-300
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ing a period when the consumption of salt fish in these foreign markets, which at one time were our markets, is greater than ever before.
What are the reasons for this state of affairs? Some of the reasons for the change can be attributed to the tremendous assistance given to the fishing industries in these foreign countries by large subsidies and assistance given to these industries by the governments to those countries to build tremendous fleets of vessels to fish on our Grand Banks.
Another very important factor is the increasing capital expenditure for stores, boats, equipment, fishing gear, etc., which have to be made by the Newfoundland fishermen. Their costs of production are too high. Newfoundland requires substantial assistance from the government if we are to hold our place in the salt fish industry by regaining some of our lost markets and getting new markets in the foreign trade. Further, Newfoundland's switch to heavy salted fish has greatly reduced the demand for our fish in these foreign markets. We should therefore produce the kind of fish these markets require if we hope to hold them against foreign competition.
At the present time there are large stocks of heavy salted fish, much of which was caught by Newfoundlanders, on hand in the maritimes. A large quantity of this type of fish was sold to Cuba but owing to present conditions sales have fallen off and this is causing some panic selling by maritimers in the Jamaican market.
Now many of the fish dealers who for years opposed Newfoundland Associated Fish Exporters Limited-known locally as NAFEL -are asking for a form of centralized exporting. I am convinced that NAFEL should not have been cancelled by this government until it had a better system of marketing to replace it.
Much of the blame for the condition of our fishing industry today can be attributed to the lack of assistance, lack of initiative and lack of interest taken in the industry by our governments, as well as by the industry itself.
Our governments, both federal and provincial, have helped the industry in certain ways, such as a bounty on the building of vessels, rebate on salt, building fishing stages, etc. While these are good measures, this assistance is not enough if we are to be the great supplier of salted fish that we were in past years. If we are to regain these markets and re-establish ourselves in foreign markets the industry will need a tremendous push, the expenditure of large sums of money, much more equipment purchased and greater assistance given to the fishermen as an incentive to induce men to return to the fishing boats.

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Newfoundland is finding it increasingly more difficult to retain her foreign markets and can have very little hope of gaining new markets without definite action being taken by the federal government to counterbalance and reduce to a minimum the difference between foreign fishermen and the fishermen of Newfoundland. Above all we need a fleet of our own vessels to carry our fish to foreign markets so that we can make all the money possible out of our own product, and to make sure that all the returns go to Canadians to be put into circulation in Canada.
I was very pleased to hear the statement made this morning by the Minister of Transport regarding assistance to the builders and operators of Canadian vessels. I hope it meets with every success, especially in our fishing industry.
In my opinion the salt fish industry still remains the main productive resource of our island home and should play a major role in the raising and maintaining of our economy at a high level. If we get the action, incentive and assistance required from all concerned, then the salt fish industry will have a bright future and will contribute to the growth of our island.
The salt fish industry still means very much to Newfoundland and to Newfoundland's economy and it will continue to play a vital part in our way of life. But its future will depend upon the action, interest and assistance of our governments, both federal and provincial, and a new outlook by the industry. The governments and the industry should act now, without delay, because time is short.
I am sure that all concerned were glad to learn that the government has earmarked $150,000 to continue assistance to the fisheries of British Columbia. The fishermen, I understand, will be paid 12 cents a pound for dogfish liver delivered to oil plants and collecting stations. I believe this grant was forgotten by the hon. members from Vancouver.
No mention was made of assistance to our east coast fishermen in a similar manner, but the dogfish is a continual source of trouble to the fishermen on the east coast, as it is to the British Columbia fishermen. For this reason I suggest that the same benefit should be extended to east coast fishermen.
The 12 mile fishing limit for fishing rights has been in the limelight again recently. To we Canadians, to the Atlantic provinces and especially to those in the province of Newfoundland, this 12 mile limit means very much. It means the difference between a sagging economy and a bolstered economy for our province. It means the difference between a small share of the wealth, and practically the wealth itself that abounds in these waters
around our shores within that 12 mile fishing limit. This is wealth which rightly and justly belongs to the people of Canada, the people of the Atlantic provinces, and in particular the people of Newfoundland, who have depended upon it for their livelihood for hundreds of years.
What is happening today, and what is taking place within that 12 mile limit? Fishermen from foreign countries, from Norway, Portugal, Russia, Spain, Sweden and other lands with their up to date ships equipped with the latest mechanical equipment are fishing our waters inside that 12 mile limit, taking the wealth out of our waters, taking from our fishermen, from our people, their means of livelihood, destroying our fishing industry and leaving the crumbs for our own fishermen with their small and limited ships which do not have the advantage of mechanical devices or modern methods.
What have we done about this? What has the government of Canada done about it? What does it intend to do to protect the God-given rights of our Canadian fishermen? Are we as Canadians, is the government of Canada, going to stand idly by and see our wealth being taken from us, our fishermen being deprived of their livelihood, our fishing grounds being used by foreign countries and our own fishermen struggling for a living against the tremendous competition provided by the foreign countries, while doing little or nothing about it?
It is up to any government of Canada, Liberal or Progressive Conservative, to see that our fishermen are given at least the same rights as those enjoyed by foreign trawlers. We were interested and glad to hear the Minister of Fisheries say on May 2 as recorded in Hansard at page 4254:
I want to assure the house that no avenue will be left unexplored, no stone unturned, in order to secure action which will result in greater benefits for Canadian fishermen in the waters adjacent to our own coasts.
Mr. Chairman, this is a matter of our own rights as opposed to foreign trawlers which very often violate those rights, rebuff our courtesy and disregard the need for conservation.
The national Liberal rally held in Ottawa last January recommended to the national council of the national Liberal federation as follows, and I quote from page 10 of the report of the rally:
We need a program for the stimulation of the fishing industry by increased assistance in the procurement of modern vesels and gear and by research in processing and marketing and in the promotion of expanded export markets. The 12 mile offshore fishing limit for foreign vessels should be established.

Recently two Nova Scotia fishing captains were summoned to appear in magistrate's court in St. John's, Newfoundland by the federal Department of Fisheries charged with operating within the three mile limit in Newfoundland waters. Yet foreign trawlers can come to our shores and legally fish to the three mile limit. This does not add up, and was never understood by the average Canadian citizen. We are glad to see that this situation has now changed and Canadian draggers can now fish to the three mile limit. I consider it is high time that this government gave further heed to the territorial rights of Canada and to the rights of her fishermen and took whatever action is necessary to see that Canadians have the assurance that their treasured possessions will be safeguarded through the exclusive right to fish within the 12 mile fishing zone. As I have already made clear by the quotation I gave, the Liberal party recognizes the need for a 12 mile limit to be enforced.
At the present time the seal fishing industry in Newfoundland is almost a thing of the past, and as a result of the returns from the hunt this spring, I doubt if any Canadian ships will take part in next year's seal hunt.
At one time, more than 400 vessels manned by some 14,000 Newfoundland sealers operated in Newfoundland and brought to port as many as 680,000 pelts in one season. This meant an annual expenditure of several hundred thousand dollars each year, and created much employment all the year round. Last year's catch had a value of less than $25,000.
This spring there were four vessels from Newfoundland and one from Halifax, manned by approximately 300 men seal hunting off the northeast coast of Newfoundland. The hunt was practically a failure, due primarily to ice conditions, and I would suggest that the minister give consideration to subsidizing the ship owners and the sealers.
Several requests for assistance were made by myself, by the owners, and by the captains of the ships who took part in the seal hunt this year to the minister responsible for the Department of Transport.


Harold Edward Winch: In view of what happened last year and this year, is the hon. member in favour of an international agreement on conservation?


James Roy Tucker: Most definitely. In spite of what I have said about the failure of the hunt as far as the Canadian seal hunters were concerned, the Norwegians have been sealing off our coast for more than 30 years and seem to make a profitable venture out of it. This year about 15 Norwegian ships operated off the northeast coast of Newfoundland. This 90205-6-3004
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spring, much to their surprise and regret, Newfoundland sealers found that in addition to the Norwegians they had another competitor in the seal hunt, a 7,000 ton Soviet icebreaker capable of cutting quickly through the massive ice floes which the Canadian vessels were unable to penetrate. The Russian ship was equipped with two helicopters which were used to scout for seals and then to transport the sealers to and from the patches of seals. The presence of this ship has discouraged our seal hunters and it is feared that if Russia continues to participate in the annual seal hunt off Newfoundland in ships similar to the one in operation this year, the Canadian sealing industry will become extinct.
The Department of Fisheries is well aware of the diminution of our seal fishery and the time has come-indeed, it is long past- for the department to take active steps to secure international agreement so that this industry may be preserved by putting a closed season on certain seals and limiting the number of seals to be taken each year. Those interested in the seal fishery were glad to learn that all sealing operations ended on May 5 of this year. The season for seal hunting opens on March 5 in the gulf area and on March 10 off the northeast coast of Newfoundland. Until this year there was no official closing date. An agreement was made this year between Norway and Canada as a result of which, next year, I understand, the season will close on April 30.
The minister stated on May 11, 1961, and I quote from Hansard at page 3531:
I might add that this item is on the agenda for the next meeting of ICNAF, the international commission for the northwest Atlantic fisheries. I should also add that it has been observed thi* year for the first time that a Russian vessel has been sealing in the international waters off the east coast of Canada. Communications have been sent to the government of the U.S.S.R. requesting that they require their nationals to adhere to the general regulations.
I should like to quote again from the Liberal rally report, at page 10-NS-2, where the following statement is found:
An effective program for the conservation of seals in Canada is required.
In closing I wish to thank the minister, and say that I believe he is a very sincere man. I thank him, as well as his officials, for the many courtesies extended to me from time to time. It is my opinion that the minister has a staff of competent officials who are well aware of the many problems that exist in the fishing industry, and I hope that they will see that this important industry is given every protection, in order that our fishermen will receive all the benefits possible from that industry.

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James Aloysius McGrath: Mr. Chairman, would the hon. member permit a question? I did not want to interrupt him when he was speaking. The hon. member dealt at great length with Liberal policy regarding the extension of the territorial limit to 12 miles. Is it also the policy of the Liberal party to enforce this 12 mile limit unilaterally?


James Roy Tucker: Mr. Chairman, I understand this can be done by agreement.


Mr. McCleave:: Mr. Chairman, my remarks will be brief, but I could hardly allow to go unchallenged the remarks made by the hon. member for Vancouver East regarding the attitude of this government toward the very important primary industry of fisheries. We all know that much has been accomplished, and that the qualities of the Minister of Fisheries will ensure that the problems of this very responsible group of fishermen in Canada will be brought forward and presented to his colleagues in the cabinet.
As an example of the progressiveness which has marked that department I should mention the fine new laboratory currently being erected at Halifax, and compliment the minister and his department for placing it there. The architecture of this new building is such that it will fit well into the complex of buildings in that particular section of the city of Halifax.
I should now like to mention a problem which is perhaps incapable of solution, although I hope it is not. The problem to which I refer results from a great deal of ice from the mouth of the St. Lawrence river drifting down to the coast of the maritimes causing considerable discomfort to the fishermen there. I am sure the minister is aware of this particular problem, as he announced just a day or two ago that the lobster fishing season in certain parts of the maritimes was postponed. Unfortunately, in the area in which I am most interested, from Clam bay along the southeastern coast of Nova Scotia to Canso, the reason has been opened on time. In some parts of that area this ice has presented little or no problem to the fishermen and they were able to place their traps and fish lobsters in the normal way. However, in other sections the ice has indeed presented a problem to the fishermen and has prevented some of them from fishing at all. In some cases the ice has destroyed the equipment of the fishermen. I have a report compiled by a number of my friends in that area regarding the losses of fishing gear. In the areas of Little Harbour, Ship Harbour, and the Tangier and Murphy cove areas, approximately 40 men have lost 25 per cent to 100 per cent of their lobster gear, and there have been additional losses in areas nearby. I do not have the complete statistics

as yet, but I will be making a visit there next week, and will be in a position then to bring details, as to the losses suffered there to the attention of the minister and his officials.
I realize that the fishermen do have an insurance fund which replaced the old fund of emergency hand-outs in cases of disaster, but some of the fishermen will perhaps be debarred from collecting under this fund because they were not insured. Since the community as a whole has been affected by these losses I hope the minister will be able to devise some formula of aid for these fishermen. Perhaps a partial solution could be found in the extension of the lobster fishing season which would alleviate the loss of profits to a certain extent, but would do nothing in the way of replacing the lost gear.
Mr. Chairman, perhaps I could be allowed to go a little afield of the subject for a moment or two, to relate an incident showing the qualities of the inhabitants of that area of Nova Scotia. They are very rugged individualists there. One week ago on Sunday, two fishermen accomplished a rather minor miracle in that they were able to provide a service to the United States which our own search and rescue team was unable to provide. A United States navy man became ill at the United States navigational aid installation at Hardwood island, which is about a mile from Sheet Harbour passage.


Mr. Benidickson:: How far is that away from a Canadian city such as Yarmouth?


Robert Jardine McCleave: Sheet Harbour passage is in the riding of Halifax, which is in Canada.
On the day in question there was a wind blowing up to 45 miles an hour, and a very dense snowstorm prevailed. An urgent request for medical aid was received from the United States navigational aid installation at Hardwood island, and search and rescue were unable to answer it because of prevailing conditions. Two fishermen, David and Stanford Levy, of a somewhat picturesque place named Sober Harbour, with the help of sergeant Murray Cottell, of the R.C.M.P., conveyed Dr. Dennis Lahey to Hardwood island. When they reached the island they were marooned for six hours, unable to make the return trip. In order to make this trip they had to go two at a time secured by ropes in the dories. While the story amply shows the heroism and courage of these two fishermen and the mounted police officer, it had an unfortunate ending in that the individual who was ill had died before he could be brought to shore. This fact was unknown to the men when they made this perilous journey to Hardwood island.

I have related this story to indicate the quality and ruggedness of these two fishermen, who are of a type that can be found up and down the coast in that part of Nova Scotia.
In regard to the problem I mentioned at the outset, I hope the minister will be able to devise some formula to provide assistance to these fishermen.


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economy, it must be expected that for the next 10 to 15 years those whose age and educational levels preclude them from being retrained and acquiring industrial skills will have no choice but to fall back on the fishing industry as a means of livelihood.
It is true that expansion of the fresh fish industry in Newfoundland has filled the gap left by the disappearance of the old banking fleet of sailing ships. Those plants have given a new lease of life to communities like Grand Bank, Fortune, Burin, Burgeo and Harbour Breton, which otherwise would have become ghost towns. Where these plants have been established the people have enjoyed relative prosperity but I should like to emphasize the word "relative" because the prosperity is relative only in comparison with communities which do not have fish plants. It is not relative in comparison with other industries either in Newfoundland or in other parts of Canada.
In my own province the best that can be said for the fishing industry is that it is holding its own. In many cases it is not doing that. The inshore fishery has not improved much in the past 12 years. It is true that the fisherman's lot has been improved to some extent but this improvement has come about mainly through the enjoyment of social security benefits which became available when Newfoundland became a part of Canada. The improvement has not resulted to any significant degree from increased earnings from the fishery.
This is not to say that nothing has been done. On the contrary, a great deal has been done both provincially and federally. The minister mentioned last night the improvement in the bait service and the provision of portable bait holding units and community stages. My colleague, the hon. member for Grand Falls-White Bay-Labrador, referred to the small loans for fishermen and the hon. member for Gloucester mentioned the subsidies for fishing vessels. To these I think we can add the salt rebate, fishermen's insurance and other forms of federal assistance. On the provincial level we can mention bounties, loans to fishermen, loans to fish companies for plants and draggers and for modernization of equipment. In spite of all this assistance, which on the provincial level has been considerable in my province and possibly greater proportionately than that provided by any other province, the desired results have not been obtained. In my opinion the results that have been obtained have not been commensurate with the assistance given.
We may very well ask ourselves two questions. In view of this assistance, why is it that the fishermen have not benefited to
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any appreciable extent? Second, what additional forms of assistance are required and how much if we are to put the fishing industry on a proper economic basis? These are two very important questions which can only be answered on the basis of facts. The facts can only be obtained by a special factfinding body set up for the purpose and armed with the necessary authority to get the information required. Since the fishing industry overlaps provincial boundaries, a body of this kind should, of course, be set up by the federal government.
As to the first question, why have we not obtained the results we anticipated from this assistance, though I am not in a position to quote facts I have been a close observer of the fishing industry in my own province and particularly in my own riding for the past 12 years. As a result of my observations I have formed some ideas and conclusions which, for what they are worth, I should like to put before the committee today.
In my opinion one of the main reasons why we have not achieved the desired results from all this assistance is the lack of an over-all, integrated program. I am not mentioning this by way of criticism directed at the minister or the government. I am stating a fact which I think has prevailed over a number of years. What we have done for the fisherman through all these various forms of assistance that I have mentioned seems to have been done on an ad hoc basis. These measures have not been the expression of an over-all policy.
The minister himself mentioned one or two good examples of that last night. He referred to the community stages. We have heard pleas today for the community stage program to be continued. Yet the minister told us last night that the program was one of 20 stages and as the 20 stages are completed that is the end of it. To what were these 20 stages related? I cannot see that this particular program of community stages has any part in any over-all program. It is something that grew up like Topsy. It fitted in as a type of winter works program. It was limited to 20 and now it is being cut off.
If the community stage program is a good thing and has a part to play in the development of our fishing industry, why should we stop it? Certainly it is one of the most important things that we need, and the very fact that it is being cut off proves my point that it is not related to any particular over-all program. Community stages are important for two reasons. They not only lower the cost of production but improve the quality of the fish. Instead of the fish being handled in many little buildings around a harbour it is brought to one place where it can be washed clean and sanitary conditions can be maintained. They

also provide the fisherman with an alternative in disposing of his fish because where there is a community stage the fisherman has a choice of selling his fish fresh or salting it. If there is no community stage he is at the mercy of whoever wants to buy his fish because he has to dispose of it at the only outlet available. The community stage program is a vital part of our fishery development program and I join with others in urging the minister to have it continued.
Another example one can cite is the salt rebate. This is a program whereby the fisherman gets a rebate of 50 per cent of what he spends on salt. Obviously the more salt he uses the more money he is going to collect by way of rebate. This encourages fishermen to produce heavy salted fish but in these times the market for heavy salted fish is poor while the market for light salted fish is good. We cannot supply the demand in Europe for Spanish cured and Italian cured fish and yet we have no program to encourage people to produce that kind of fish. On the other hand, we are encouraging them to produce a kind of fish which the market cannot absorb at the present time.
I think another reason why this program has failed is that the various provinces have had their programs and the federal government has had a separate program and if any effort has been made to integrate them it certainly has not been very successful. A good example of that is the portable bait holding units. As the minister told us last night, we have provided these at the rate of eight or ten a year. In Newfoundland alone we need at least 50. I think we could take care of most of our needs with 50 or possibly up to 75 but no more than that. Why should we have to dole these out at the rate of eight or nine a year and spread the small cost over a period of eight or ten years? They only cost about $5,000 or $6,000 per unit and if we had a program of 50 units for one year the cost would not be exorbitant and such a program would do much to establish our fishing industry on a sound basis.
Another reason, in my opinion, is that we have departmentalized our fishing industry within the boundaries of the various provinces. By doing this we have conformed to a clash of interests within the industry as between one province and another. The hon. member for Trinity-Conception cited the case of NAFEL, as did the hon. member for St. John's East. NAFEL, the Newfoundland association of fish exporters limited, came into being to deal with a situation under which we had to sell our fish to a central buying agency. Individual sellers were at a disadvantage in having to sell to that kind of agency. There were some undesirable features
Supply-Fisheries
in NAFEL, I readily admit, and I hold no brief at all for that organization. I do not think it was as aggressive as it might have been, but it certainly filled a need and the undesirable features could have been changed. It did not suit our friends on the mainland at that particular time, and they were out for NAFEL's scalp.
Eventually, the exclusive right of NAFEL was removed. Now we have the reverse situation because of that and because of the developments that have taken place in Cuba, whereby we are at a disadvantage again in marketing our fish to a centralized buying agency. The very people who wanted to kill NAFEL have now realized the benefit of it and would like to have it back. The point is not whether or not we have NAFEL back. The point is that we should have some organization to market our fish in a situation where we have to deal with centralized buying agencies.
In spite of all the assistance we have given to the fishing industry it has been so ineffective that foreign draggers can come all the way from Europe and fish on our very doorstep, producing fish more cheaply than we can and underselling us in the markets of the world. This morning the hon. member for Grand Falls-White Bay-Labrador listed the problems of the fishing industry under three headings, production, processing and marketing. I would add two more headings to those, conservation and research. While it is convenient to separate our problems under various headings, this tends toward oversimplification because all these problems are interrelated and overlap each other. For example, the problems of production overlap the problems of conservation. The problems of processing overlap the problems of marketing.
My time is running out and I shall have to limit my remarks primarily to the problems of production. The fishing industry in my province is hampered by production costs. One of the. most important factors in that cost of production is the cost of living. Also the cost of our Canadian ships, the cost of their construction, maintenance and operation, is much higher than similar costs for the same kind of ships and equipment from foreign countries. The Canada Shipping Act regulations impose standards from which foreign draggers are exempt, and these add to the cost of operation of Canadian companies.
If we are going to assist the fishing industry by means of a bounty or subsidy, the size of the subsidy should be related to this differential between the cost of construction, operation and maintenance of vessels in Canada and the cost to our foreign competitors.

Company Directors
In addition, there is the cost of nets, twine, gear, processing machinery and fuel for the operation of motors. In this connection, the tariffs imposed on these items greatly increase our costs of production. I want to support the recommendations which the fisheries council made to the Minister of Finance to remove these burdens. We have done this for other industries. We have done it for the farm industry and, in some cases, for the logging industry. However, for some unaccountable reason we are reluctant to give the fishing industry the same kind of treatment we have given to other industries.
I see it is five o'clock, Mr. Chairman, and I have a few more items to mention. However, I feel this is a very good time for me to stop and perhaps I shall have another opportunity later.


The Chairman:: Order; it being five o'clock it is my duty, pursuant to section 3 of standing order 15, to rise, report progress and ask leave to sit again later this day or at the next sitting of the house, as the case may be.
Progress reported.



COMPANY DIRECTORS


Mr. E. J. Broome (Vancouver South) moved: the second reading of Bill No. C-26, respecting company directors (directors' qualifications).
He said: Mr. Speaker, the purpose of this bill as given in the explanatory note is to require that all companies created by the parliament of Canada be managed by a majority of directors who are either Canadians or Canadian residents. When this bill was first introduced two sessions ago, the requirements of the bill were a great deal stiffer in that they called for directors who were Canadians. Hon. members will see, therefore, that this bill is not now as strict or as limited in its provisions as the one which was first introduced. Undoubtedly, other changes will be required. What I propose to do today, Mr. Speaker, is to give the reasons why I think this bill is both timely and urgent and to point out two areas in which it might be modified. I would suggest also to the house that if it meets with the approval of the house it might well be read a second time and then referred to the standing committee on banking and commerce.
I feel, for instance, it might be an advantage if the wording were changed to indicate that the majority of directors must be resident in Canada and that the majority of this majority must be outside directors; that is,
[Mr. Carter.)
directors who are not employees of the company. They could well have a financial interest in the company but would not directly be executives of the company concerned.
Another change which was suggested has to do with international, non-profit organizations such as governmental organizations. Hon. members will recall that recently the house approved a bill to incorporate the international brain research organization. Like other such international non-governmental organizations, the I.B.R.O. visualizes a governing board with directors from many countries.
A member of the press gallery has written an interesting doctoral dissertation entitled "Facilitation Problems of International Associations" in which he suggests Canada should do more to attract these organizations. I understand that currently the budgets of these organizations, as listed in the year book of international organizations, amounts to some $306 million. In addition, the total budgets of the intergovernmental organizations come to some $415 million. It will therefore be seen that the combined budgets of the international non-governmental organizations are actually bigger than those of the intergovernmental organizations.
At present Canada is host to very few of these organizations, though I might mention the international air transport association and, of course, the I.B.R.O. Naturally such organizations could not possibly be constituted with a majority of the board of directors being resident in Canada as these directors will be drawn from all over the world.
I should like to quote from an address given by the Prime Minister of Canada (Mr. Diefenbaker) at Dartmouth college on September 7, 1958. The Prime Minister said:
There is an intangible sense of disquiet in Canada over the political implications of large-scale and continuing external ownership and control of Canadian industries .. . Canadians do not wish to have their economic, any more than their political, affairs determined outside Canada.
I have heard many hon. members on the treasury benches make statements in speeches which are very similar to this and which I believe echo the concern of the Canadian people. In a booklet "Foreign Investment in Canada" by J. M. Smith, published by the Canadian Institute of International Affairs, on page 11 is found a table entitled "Non-resident and United States ownership and control in selected industries, 1954".
This information is taken from the Canadian-United States economic relations committee, page 104, which was a study prepared for the royal commission on Canada's economic prospects. This table shows that the percentage of industry controlled outside of

this country in automobiles and parts is 95 per cent; in the rubber industry, 93 per cent; in electrical apparatus, 78 per cent; in chemicals, 75 per cent; in the petroleum industry, 70 per cent; in other mining, 57 per cent; pulp and paper, 56 per cent; smelting and refining of non-ferrous native ores, 55 per cent.
As hon. members know, the royal commission brought down its findings several years ago. This pamphlet goes on to state that the control and ownership, particularly in the petroleum industry, is undoubtedly much higher now than the figures given here.
In general, Mr. Speaker, one might say that we in Canada own and control the non-industrial spheres. We own the roads, hospitals, public buildings, houses and farms, but in our manufacturing industries and resource development industries we are at the best a very small minority participant.
This booklet refers to recommendations made by the royal commission on Canada's economic prospects and I should like to refer to these. They can be found on page 393 of the final report, where the commission, in discussing foreign investment in Canada, had three recommendations to make. Before making these recommendations they set out that it is important that Canada should not discourage foreign capital by unfair, discriminatory action and that the free movement of interest and dividends to foreign investors should not be interfered with by currency restrictions. I quote from page 393:
We believe Canadians should have more tangible assurance than they now have that the people who are responsible for the management of such foreign-owned concerns will, whenever reasonably possible, make decisions that are in the best interests of Canada: that such concerns in effect become more "Canadian" in outlook. We do not suggest by this the development of a narrow nationalistic outlook; nor that the concerns in question should be restricted in their access to their parent companies and to all the benefits and advantages they obtain as a result. The following specific suggestions respecting desirable objectives for the operations of such foreign-owned concerns would not have these effects; we believe they would be of benefit to all concerned.
Then the commission makes the following recommendations:
(1)	wherever possible, such concerns should employ Canadians in senior management and technical positions, should retain Canadian engineering and other professional and service personnel, and should do their purchasing of supplies, materials and equipment in this country;
(2)	they should publish their financial statements and make full disclosure of the results of their Canadian operations;
(3)	they should include on their boards of directors a number of independent Canadians and they should sell an appreciable interest in their equity stock to Canadians.
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The purpose of this bill has to do with one half of the commission's third recommendation. I have had other bills on the order paper. I had one bill on the order paper in regard to financial statements. I am pleased to say that the government has taken it up in the form of a government bill which is a much better bill than the one I proposed. I sincerely hope this particular bill will commend itself to this government.


William Moore Benidickson: Is the other bill going ahead this session?


Harold Edward Winch: Mr. Speaker, I rise on a point
of order and ask that the house be physically counted for the purpose of ascertaining whether there is a quorum. I ask that the count not include hon. members coming in from behind the curtain.
I raised my point of order, sir, because at the moment I counted there were only 19 hon. members in the chamber. One or two have come in since.


Mr. Bell (Saint John-Albert):: Mr. Speaker, I think the hon. member made a mistake. I distinctly thought there were 21 hon. members present.


Harold Edward Winch: I counted 19, but some have come in since.


Some hon. Members:: No.


Mr. Speaker:: Order. There appears to be no deficiency in the quorum at the present time.


Ernest James Broome: The royal commission went on, on page 394, to deal-


William Moore Benidickson: Before the hon. member proceeds, may I comment on the fact that he made reference to the government bill and said he felt it was in some respects superior to his own bill. I wonder if the hon. member could inform the house whether or not the government bill with respect to the disclosure of financial status and so on will be proceeded with this session, because that might have some influence on our judgment with regard to the measure now under consideration.


Ernest James Broome: I do not see that that matter is at all relevant. The fact that it is on the order paper is good enough for me.
Referring particularly to the third recommendation of the royal commission, the final report goes on to say, as reported on page 394:
The third objective is that Canadian subsidiaries of foreign companies-particularly the larger, well established ones-should sell some part of their equity stock to Canadians and include a number of independent Canadians on their boards of directors. A number of companies have adopted this policy and have said that it has worked out well and to their advantage. Certainly we see no reason why, if the Canadians selected as directors

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were able and conscientious men, the adoption of such a policy would not work out to everyone's advantage. In addition to the fact that the public would have some assurance that broad Canadian interest would not be lost sight of in the everyday discussion and decision of company policies, the companies in question would be better informed of Canadian views and attitudes. Both in the case of long range company planning and in decisions concerning day-to-day operations, such Canadian directors would not be likely to forget the broader interests of the nation.
Then the commission went on to say, as recorded on page 395:
The proposal that Canadian subsidiaries of foreign companies should appoint independent Canadians to their boards of directors and sell stock to Canadians is, of course, not a new one. But fewer companies than one might have expected have done anything about it. It seems to us that on the whole those Canadian subsidiaries of foreign companies which have adopted the policies we are suggesting have made a greater contribution to the Canadian economy in many ways than others that have not such policies. Those that have done so appear to be more interested and aggressive in developing their Canadian operations and to be more aware of Canadian problems and viewpoints. There is no way in which we can prove this general proposition scientifically-but it is a definite impression we have gained as a result of our travels, hearings and discussions.


Mr. McGee:: Would the hon. member mind repeating the source from which he has just been reading?


Ernest James Broome: I was reading from the final report of the royal commission on Canada's economic prospects.


William Moore Benidickson: Surely the Secretary of State is not leaving?


Ernest James Broome: I should like, in setting out this ground work, to refer to an address by Mr. R. M. Fowler, president of the Canadian Pulp and Paper Association, at the annual luncheon of the association in Montreal on January 27, 1961 in the course of which he discussed Canadian-United States relations. He had this to say as reported on the last page of his speech under the heading "The Basic Philosophy":
In the current debate about the extensive investment by Americans in Canadian industry, the problem is usually broken down into a number of separate issues. It is suggested that financial statements should be published, that Canadians should have a chance to buy shares, that more Canadians should be employed in senior positions and more research should be done in this country. No doubt all these steps have some value in themselves, but in my opinion all could be taken by a company and the problem would remain unsolved. A subsidiary can sell stock to Canadians, can have Canadian personnel throughout, can give generously to charity and so on, but if most of the decisions are made back in the home office by men whose interest in the Canadian operation is not greater than, and often less than, their interest in a dozen similar operations throughout the world then that subsidiary is not being a fully Canadian corporate

citizen. The first essential is de-centralized, autonomous Canadian management in the subsidiary.
I suggest that the views of a man with the international reputation of Mr. Fowler are well deserving of attention.
Again, in a speech to a seminar on Canada-United States relations at the university of British Columbia, Dr. John Davis, director of research for the British Columbia Electric Company, gave food for thought when he said that over half the profits of Canadian industry belong to non-residents, mostly Americans. That has nothing to do with the present bill, but Dr. Davis did go on to mention several complaints, one of which was the failure of United States subsidiary companies to appoint outside directors. He felt that Canadian industry could not operate and take its proper place in the economic life of this country unless there was a measure of control in the form of outside directors who could give to the parent company proper information and proper ideas as to how the operation of their companies could best be carried on in Canada.
I would refer also to the declaration of policy by the Canadian chamber of commerce for 1960 and 1961 as reported on page 39 where the following statement is made:
The Canadian chamber of commerce recognizes that a high rate of non-resident, long term, investment in Canada is essential to the continued development of our country's resource and manufacturing industries. However, it is concerned as to whether the non-resident owners are familiar, in all cases, with the principles underlying the Canadian point of view and thereby overlook or disregard legitimate Canadian interests.
Then follows the recommendation:
The Canadian chamber of commerce strongly suggests to the federal government, provincial chambers and non-resident owned businesses operating in Canada that it would be in the best interest of such companies to place or list their stock on the various Canadian stock exchanges, include independent Canadians on their boards of directors, employ Canadian citizens wherever possible, especially in managerial and technical positions; purchase their equipment, material and supplies locally when it is economical to do so, and publish separate financial statements on their Canadian operations.
A review by the Empire Trust Company of New York with regard to American capital and Canadian management, in queries to major United States corporations operating in this country found that those companies which had the most successful operation in general were the best citizens as far as the employment of Canadians, the appointment of Canadians on boards of directors, the publishing of financial statements and so on were concerned.
Perhaps the most recent publication is that put out by the Canadian-American committee and sponsored by the National Planning

Association of the United States and by the Private Planning Association of Canada. This booklet is entitled "Policies and Practices of United States subsidiaries in Canada." The authors of this booklet are Mr. John Linde-man and Professor Donald Armstrong. The former has had wide experience in the field of international economic affairs with the United States government and as a private economic consultant. He is the author of earlier studies on United States business performance abroad, published by the National Planning Association, and he is currently a partner in International Economic Consultants, Inc. in Washington, D.C. Professor Armstrong has had broad experience as an economic consultant in Canada and has recently been appointed director of the school of commerce at McGill University in Montreal.
At page 6 of this report the following statement appears:
In the preparation of the report the staff has benefited greatly from the advice and collaboration of a large number of Canadians and Americans in many different organizations.
Chapter 4 of this book entitled "Canadian-ization of Personnel" deals with the subject matter of this bill. I will not read all the details found in that chapter but will refer only to the conclusion. The paragraph contained in the conclusions section deals with the suggestion that at professional and technical levels Canadians are discriminated against. That paragraph reads as follows:
At the professional and technical levels Canadians already have an employment advantage over non-Canadians.
It shows that the record of subsidiaries in this regard is a very fine one. The paragraph includes the following statement:
A case might be made, however, for transferring to Canada some of the technical and professional tasks now being performed by the parent in the United States on behalf of the subsidiaries.
This statement refers, of course, to work in the field of research. It also is suggested in these conclusions that of the companies considered it was found that in many cases the nominally titled president was a resident of Canada while the actual executive direction in respect of all routine matters came from United States headquarters of the parent company, and from individuals who held no titles at all in the Canadian subsidiary.
It is also pointed out that the degree of Canadianism of a company is dependent upon the strength of the executive team. If there is a strong executive team at the head of the company the company will be more Canadian than a company with a weak executive team at the head. It points out that if
Company Directors
a parent company wants to make all of the decisions, almost invariably that company has a weak executive team.
In the conclusions at page 39 the following statement appears:
With respect to executive positions, there is a discernible preference for Canadians to fill the jobs available in Canada. The degree of Cana-dianization of such jobs is probably much greater than the meagre statistics on this point would indicate. However, titles and the nationality of the officer holder have little meaning in themselves. The important thing is the amount of authority that goes along with the office. On this point the interviews showed considerable variation among the companies, a variation which apparently reflects home office attitudes that cannot be changed simply by replacing U.S. executives in Canada with Canadians.
As was the case with companies with Canadian equity participation in ownership, it was found that decision-making authority tends to be greater in Canada among the subsidiaries with outside Canadian directors. This is not surprising, because most of the companies with Canadian equity participation in ownership also have outside Canadian directors, and most companies with outside Canadian directors also have Canadian equity participation. Whether outside Canadian directors will necessarily and automatically produce more autonomy for the Canadian subsidiaries is perhaps an open question. Much will depend on the strength of the men selected. But it is at least possible to assert that companies which give their Canadian subsidiaries a relatively high degree of autonomy are more likely than other companies to recognize the business and public relations value of a functioning board of directors with broad Canadian representation.
I think I have proved the case that subsidiaries of foreign companies would find it profitable to have directors who are residents of Canada and that these directors should, in the main, be outside directors who are not employees of the company. It seems to me, in view of the fantastic ownership of our industries, as I have pointed out and supported with tables which I have quoted, that this scale of industrial set up is not to be managed at the level of an annual meeting or luncheon held in New York or some other United States city. Absentee ownership may not interfere with plant functioning, or the efficiency of a plant, but certainly lends itself to a foreign outlook on the part of the companies concerned. The executive of a foreign company is not always a policy making executive, and it is in the field of policy making that it is most important that we set up a financing board and a policy making board which will interpret Canadian aspirations and Canadian conditions for the owners in whatever land they may reside.
It is quite true that the industry in many ways is putting its own house in order, but why should a good company do this when a poor company is allowed to get away without doing it. I suggest in this field it is in

Company Directors
our national interest to set minimum qualifications regarding the operation of companies in the same manner as we have set qualifications governing many other spheres of activity. We should also have qualifications governing the policy making sphere because I feel we are entitled in this country to have the industries which are growing here, profiting from the use of our natural resources and profiting from our domestic markets with almost life and death power over the economy of many communities, obliged to appoint as the policy making heads individuals who live in this country and understand the conditions under which the company will operate.
When I introduced this bill I pointed out several areas where this idea might well be modified. However, I suggest the fundamental principle is such that no hon. member in this house can quarrel with it. The fundamental principle is right and just, and I commend it to all hon. members for consideration.


William Moore Benidickson: Mr. Speaker, before the hon. member concludes, I would like to pursue the question I raised earlier. The hon. member said he felt the government's Bill No. C-70, an act to provide for the furnishing of financial and other statistics relating to the affairs of corporations and labour unions carrying on activities within Canada, had merit beyond his own bill. The hon. member in making that statement undoubtedly felt that in considering this bill we would be concerned with the other bill. I should like to ask him if he shares my view, that Bill No. C-70 is in fact a phony bill and will not be proceeded with at this session?


Ernest James Broome: Mr. Speaker, I was referring to my own bill regarding the publication of financial statements. My bill deals only with companies incorporated by act of parliament, and it was worded that way because of the existence of various provincial companies acts. However, Bill No. C-70 represents a different approach to the problem and has reference to all the companies in Canada which properly may be considered public companies but which through a quirk of the law are considered private companies by virtue of the provision of having 50 shareholders or less.
As has been pointed out by the hon. member, I spoke in the debate and gave instances of gigantic corporations in this country such as General Motors, Chrysler Corporation, Heinz, and there are dozens of others, which are classed as private companies in this country, but in their country of origin they are public companies. The characteristic of the parent descends to the

child. If the parent is a public company, then the child should be a public company. This is what I said-


William Moore Benidickson: It is a phony.


Ernest James Broome: It is not a phony, and I can tell the hon. member that he will certainly find this out. If he goes out on the hustings during the next election campaign he will find that he will not get very far with this kind of philosophy.


Harold Edward Winch: assure you, sir, that I am not interested in a government or an opposition member fighting the next election. I do not very often agree in policy or politics with the hon. member for Vancouver South. Nevertheless, I believe that he should be thanked for his courage in proceeding with the bill before us because I believe it is in complete conformity with what we understood the government of Canada was going to do following the speech from the throne. It has not done it, but he has had the intestinal fortitude to follow through with a private member's bill. I was very sorry that the hon. member had to take half an hour to introduce the bill. I sincerely hope it will not be talked out because it was introduced by a backbencher on the government side of the house who is trying to put forward what we understood to be a principle of the Conservative party enunciated during the election campaign and in the speech from the throne itself.
This bill has only one major purpose in principle. Its purpose is to require that all companies created by the parliament of Canada after this legislation becomes law shall be managed by a majority of directors who are either Canadians or Canadian residents. That is an understandable thing. They must be either Canadians or Canadian residents. Therefore, Mr. Speaker, I have only one criticism of the bill as far as the explanatory note goes. I take exception to the words "Canadian residents". I wish the hon. member had said "Canadian citizens" because I know of many important companies in Canada-and a great many in British Columbia-the managers of which are Canadian residents but not Canadian citizens.


Frank Charles McGee: Will the hon. member permit a question?


Harold Edward Winch: In a moment. I know of major logging industries in British Columbia, the managers and directors of which have been residents of Canada for 30 years but never Canadian citizens. I think it is very important that these people should be Canadian citizens. The bill of the hon. member refers to "Canadian residents". I feel it is bad for a

manager of a company to be a resident of Canada for over 30 years but still remain a citizen of some other country.


Frank Charles McGee: Will the hon. member now permit a question?


Harold Edward Winch: I tell the hon. member I shall be glad to answer any question in a few moments. I say this because I do not want to see the bill talked out. This measure introduced by a private member covers in principle that which was promised in election campaigns and in the throne speech by the Conservatives. I wish to call to your attention, sir, that in the discussion of this important measure introduced by a staunch Conservative every minister who has anything to do with matters of this kind is absent from the House of Commons at this time.


William Moore Benidickson: They walked out after the hon. member started to speak.


Harold Edward Winch: I want to say that I completely support the principle of the bill.


Mr. Speaker:: Order. If hon. members wish to carry on private conversations they had better go out in the lobby.


Harold Edward Winch: That is where they were half an hour ago when only 19 members were in the house. They came in fast then.
I agree in principle with what the hon. member for Vancouver South is trying to do by a private bill, namely to overcome the fallacies and the dereliction of the government in so far as the speech from the throne is concerned. I sincerely hope that the bill will be passed. I do hope that when we reach the committee stage, if we do, the term "Canadian resident" will be changed to "Canadian citizen".


Frank Charles McGee: Mr. Speaker, before I proceed to discuss the bill in question I propose to put in another form the question I was going to put to the hon. member who preceded me and say that in connection with this question of Canadian residence, I am sure the hon. member would not want to penalize some person who had come to Canada and was in the process of becoming a Canadian citizen.


Harold Edward Winch: What is the question the hon. member was going to ask?


Frank Charles McGee: Would the hon. member not agree with me that by making the change he suggested he may be penalizing a person by insisting that he become a Canadian citizen before he could qualify as a director under this legislation? This would in fact be penalizing a person who had come to Canada and was in the process of becoming a citizen but was not yet a citizen.
Company Directors
The hon. member spent a great deal of his time in being out of order, it seems to me, as was the hon. member for Kenora-Rainy River (Mr. Benidickson). I can hardly conceive that discussion of the business of the house and government business is in order in debating a private member's bill.
If the hon. member for Kenora-Rainy River wishes to find out such information it seems to me there is a proper place for such comment. The hon. member for Vancouver East made much of the number of members in the house a while ago. In view of the fact that he raised this issue I think I might say that he was the only member of his party in the house at the time. Perhaps he was using this method to point out the errors of some of his colleagues and perhaps I had better leave it at that.
I should like to congratulate the hon. member who introduced this bill. It seems to me he was far too modest in respect to the influence that the discussion of private members' bills on this and other subjects some years ago had on subsequent government policy and government bills. I think he made a most profound impression on the house previously, and inevitably on government policy itself.
The statement is made occasionally when discussions revolve around bills such as this and other measures that by bringing up matters such as this and by pointing to dominant United States ownership of Canadian industries somehow it adds up to anti-Americanism. I think the people who hold this view concerning such matters are exaggerating. The obvious answer-and the answer has been given by other people-is that this is by no means anti-American but by all means pro-Canadian. It seems to me that nothing but good can evolve from discussions that remind us individually and as a nation of the state of affairs in terms of foreign ownership and control, and if no other function is served than to caution us with respect to where these trends are leading us, such discussions perform a very useful function indeed. I was impressed by the statement that the hon. member read from the report of the royal commission on Canada's economic prospects, particularly the fact that it was noted that where firms had already in fact implemented policies in the pattern of their directorates which would qualify under this bill the results have been very beneficial indeed.
There is one aspect of the problem on which I wish the hon. member had perhaps spent a little more time, and I recall this criticism being raised when the bill was first discussed two years ago. I refer to the assertion, and to be fair I must say he did touch on one

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aspect, that if such a bill became law it would create a class of professional directors or in a sense a group of front men qualifying according to the letter of the law but clearly avoiding the spirit of the law. Certainly this point deserves some attention. This aspect of the problem is perhaps superficial but I think it could and should be answered more clearly.
This bill and other bills and resolutions introduced by the sponsor of this measure focus attention on what has to be the utimate solution, namely, that Canadians are going to have to lose some of their investing conservatism and take a more aggressive interest in purchasing equity stock and participating through measures such as this and others. This is not an easy road and the investing habits of Canadians cannot be expected to change overnight. However, I feel that discussion and debate of matters such as this should be very much encouraged as they will ultimately benefit Canada. I should like to conclude by congratulating the hon. member and by wishing him well with this bill.


Mr. Douglas Jung (Vancouver Centre):: Mr. Speaker, may I also take a minute or two of the time of the house to congratulate the hon. member for Vancouver South (Mr. Broome) on the introduction of this bill. Those of us who know him well, and I consider myself one of such persons, know the study he has put into this subject and into all other subjects on which he speaks, and I am delighted to be able to support the principle of the bill.


Ernest James Broome: Say more. Keep that up.


Douglas Jung: I agree with everything the hon. member has said but I think he should have gone further and included in his remarks the desirability of setting up citizenship qualifications for directors of labour unions in Canada. Labour unions, with their very large membership, are comparable in size and activities to industrial corporations, and their activities certainly have a great influence on the Canadian economy. Because the activities of Canadian unions have a direct bearing on the Canadian economy I think that the hon. member for Vancouver South should have included the directors of national labour unions in his bill.
As an example, consideration might have been given to the influence which union officials of another country have in directing strike activities in Canada. All I can say at this time is that if we must have strikes let them at least be directed by Canadians. I say no more because I know 1 am already imposing on the house and its generosity by introducing a subject outside the scope of the present bill. I simply conclude by saying that I appreciate the remarks of the hon.
[Mr. McGee.)
member for Vancouver East (Mr. Winch) when he said that citizenship qualification was a very desirable thing to have in the case of corporations.


Mr.  M. D. Morion@Davenport: Mr. Speaker, the hon. member for Vancouver East (Mr. Winch) made some reference to the promise in the speech from the throne of a bill similar to that now introduced by the hon. member for Vancouver South (Mr. Broome). The only reference I see in the speech from the throne reads as follows:
You will be invited to consider means by which to encourage a greater participation by Canadians in the ownership and control of industry and resources in Canada. You will be asked to approve legislation requiring the disclosure of information by business and labour organizations in Canada controlled from outside Canada.
Certainly it is the policy and the declared intention of the government to provide greater opportunities for the control of industry developed in Canada and companies operating in Canada. But the problem before us today and the motives which prompted the hon. member for Vancouver South in bringing this measure before us are found in the natural desire of Canadians to have the greatest possible control of our own assets as they are developed. The problem that arises is to what extent can we control the development of our assets by foreign investors without discouraging the foreign investment that is necessary for the development of the country.


Mr. Regier:: Is it necessary?


Mr. Morton:: I think that is a matter of opinion. The hon. member speaks as if it is not. I think there is plenty of evidence to show that we have not got sufficient money of our own to develop the country as quickly as it should be developed. I know that the hon. member has the authority of no less a person than the governor of the Bank of Canada who said in a recent speech before the Canadian chamber of commerce:
... we are now at one more of the critical crossroads in our history, perhaps the most critical of all, when economic developments and preoccupation with economic doctrines of an earlier year are pushing us down the road that leads to loss of any effective power to be masters in our own household and ultimate absorption in and by another.
I think that expresses the fear of many Canadians at this stage in our development. On the other hand, I have in my hand an article written by Professor James V. Poapst, professor of finance at the university of Toronto, which appeared in the December, 1960, issue of the Canadian magazine known as The Executive. He attempts to answer Mr. MAY 12, 1961
Coyne's statement. The professor does not disagree with the desire and need of Canadians to take control gradually of their own resources and their development but in a very thought-provoking article he does warn us against haste in our nationalistic pride and desire to take over control lest we frighten away the foreign capital that is necessary in the meantime. He points out that discriminatory legislation seriously deters future growth when that growth would require large capital imports to finance it. Then, he goes on to say:
Let's not panic over foreign investment. If it does in fact create a problem, let's try a positive approach to its solution.
I think perhaps the suggestion of the hon. member for Vancouver South is one for safeguarding this control. Whether or not it is timely, I feel, is a matter that has to be seriously considered. Professor Poapst said this:
In companies controlled by foreign investors, they decide whether Canadians are to be admitted as shareholders, participate in management, whether the company will undertake research in Canada, what products it will develop, where it will buy and sell, the prices it will charge, whether it will expand or contract. It is foreign control over decisions such as these that creates concern over "loss of autonomy", the greatest cause of concern over foreign investment. We are too sensitive about autonomy, inclined to think that any loss of it is bad. Yet complete autonomy requires economic self-sufficiency. Economic development based on specialization and trade involves the continued reduction of economic autonomy to acquire greater freedom from want. We should not try to avoid all possible reductions in autonomy but, rather, try to avoid any reductions that are not worth while. Canadians have benefited enormously from foreign investment. We lose sight of this when we become concerned with various aspects of autonomy.
Then, he goes on to say:
How significant is the fact that Canadian equity investors are excluded from many foreign owned companies? It is participation in total disbursements, not participation in distribution of profits alone, that is important. Obviously foreign companies pay wages to and buy goods and services from Canadians. Nor in an era in which about one half of net earnings are paid out in profits taxes can it be said that Canadians do not participate in the profits of foreign companies. Here taxation, which when applied to ourselves is described as punitive, is levied for our benefit. The number of individuals who would benefit directly from access to the shares of more foreign controlled companies is not large. While individuals are the major shareholders in Canada, share investment is narrowly concentrated among them. Institutional investment in shares is quite limited. Access to shares of foreign controlled companies could reduce the supply of equity funds for Canadian controlled companies. Finally, as it is, not all foreign controlled companies exclude Canadian shareholders.
Then, the professor goes on to say:
When a country commences to discriminate against foreign investors, these investors can be
Company Directors
expected to re-assess it as an outlet for further investment. This is not to argue that we must never discriminate against foreign capital.
Then, he says further:
There have been complaints that foreign companies do not give Canadians sufficient place in management. We lack comprehensive information on the distribution of management in these companies but in the study Canada-U.S. Economic Relations Gordon commission scholars, Irving Brecher and S. S. Reisman, reported on an examination of a sizable number of the larger ones. They found "overwhelming evidence of widespread participation by Canadians in the management of large foreign controlled companies". Also noted was an evolutionary process respecting the nationality of the managements. Foreigners who held senior positions initially tended to be replaced by Canadians as the latter became trained or otherwise acquired sufficient skill to do the job. Is nationality apt to override ability in the choice of management in companies where profits and not chauvinism guides decision-making?
I pointed out this aspect of it, not in opposition to the principle advocated by the hon. member for Vancouver South but because we know that during these days there is great evidence in all countries of a desire to control and benefit from their natural resources. I think perhaps the same situation prevails, to some extent, in the South American countries. Some of them have taken perhaps more stringent legislative steps to control their assets than we have. Perhaps that is why some of them have been slower in their development than we have. Yet, I feel it is timely for us, as Canadians, to examine the control that should be exercised over the development of assets of our country, and the legislative means that could give us that control without discouraging entirely the foreign capital that is desired.


Harold Edward Winch: Would the hon. member allow a question?


Murray Douglas Morton: Yes.


Harold Edward Winch: Would he allow this bill to come to a vote?


Murray Douglas Morton: Now, the hon. member wants to put the responsibility on me for allowing this measure to come to a vote. I understand there are two or three other members who want to speak on it. In addition, as the hon. member knows, the primary purpose is not the adoption of the bill but the opportunity for private members to express their views so that those views can be considered by the government and others in the country. Then, if we can come to a solution that is satisfactory to all Canadians, legislative steps can be taken. I am afraid if we held snap votes on all these measures we would not come to decisions which would be in the best interests of the country.

Business of the House BUSINESS OF THE HOUSE


John Whitney Pickersgill: I wonder if the acting house leader would let us know what is to happen tomorrow and perhaps he could tell us something about next week.


George Clyde Nowlan: Tomorrow, we will go on with estimates. We will be taking up the estimates of the Department of Transport tomorrow. If we finish those tomorrow, we will then go on with the estimates of the Department of Justice. On Monday and Tuesday, we will be dealing with legislative matters. The first matter to be considered is order No. 4 on today's order paper, an amendment to the Criminal Code in respect of race meetings. I would assume that bill would not take too much time. Following that, we would deal with No. 6 on today's order paper, the setting up of the sessional committee on railways, air lines and shipping.
Having concluded the debate on that, we will take up item No. 8 on today's order paper concerning the Freight Rates Reduction Act. Having concluded that, we will then take up item No. 5 on today's order paper, the introduction of a measure to amend the Canadian National Railways Act with regard to
the board of directors. If we conclude all of this before Tuesday evening, which I hope we will, we will then proceed with resolutions Nos. 9 and 10 on today's order paper. On Wednesday-


John Whitney Pickersgill: Perhaps the minister would just indicate the names of those because the order numbers would not be the same next week.


George Clyde Nowlan: Order No. 9 is the resolution with respect to the Farm Improvement Loans Act in the name of the Minister of Finance and No. 10 is the resolution respecting the War Veterans Allowance Act in the name of the Minister of Veterans Affairs.
On Wednesday, we will return to the consideration of estimates. I would prefer not to designate the departments tonight. I understand my colleague the Minister of Fisheries did not finish his estimates and I would assume we would go on with his department on Wednesday. However, we will deal with that later.


[Stage Direction]
At six o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Saturday, May 13, 1961