1961-06-19

Hon. Michael Starr (Minister of Labour):: Mr. Speaker, I am pleased to call to the attention of the house the presence in the diplomatic gallery of the minister of labour of Nigeria, Hon. J. N. Johnson. Mr. Johnson is currently visiting Canada and the United States and recently has been attending the international labour conference in Geneva. I am very pleased to welcome him today. I am sure all hon. members would wish me to express our good wishes to him and to his country, Nigeria, which gained independence within the commonwealth last October, and which is a friend of Canada.


Hon. Paul Martin (Essex East):: Mr. Speaker, we in the official opposition are happy to join with the Minister of Labour in extending a warm welcome to so distinguished a person as the minister of labour of Nigeria. We not only extend him a warm welcome but in this way we express our admiration for his country.


Mr. Harold E. Winch (Vancouver East):: Mr. Speaker, members of this group are pleased to join with the Minister of Labour and the hon. member for Essex East in the sincere and cordial greeting that has been extended to our distinguished visitor. I think the feelings of this group can be best expressed this way. We all take great pride in the commonwealth and its organizations, and are convinced that it can make a great contribution to the peace and prosperity of the world.
One way in which this can be done is by the exchange of men who hold high office such as our distinguished guests here this morning. I know that in Canada we always welcome ministers from other nations and by the mutual exchange of views, opinions and understanding of each other there is given a lead to world peace and happiness. We in this group, are very thankful for the opportunity of adding our words of welcome to our distinguished visitor and hope he will have not only a pleasant but an interesting stay in our country.
90205-6-412i



COPYRIGHTS


Miss Judy V. LaMarsh (Niagara Falls) moved: for leave to introduce Bill No. C-112, to provide for copyright in Canada and to implement the universal copyright convention.


Mr. Pickersgill:: Explain.


Julia Verlyn (Judy) LaMarsh: This bill which is introduced as the result of several weeks of intensive effort, is an act to repeal the present Copyright Act which is 40 years old and to provide for its modernization; further, for the assistance of authors and architects, composers and cameramen, playwrights and poets and other artists within the community; and to further protect them by implementing the universal copyright convention signed in 1952, pursuant to the recommendations of the Ilsley commission of 1957 and the O'Leary commission of 1961.
Motion agreed to and bill read the first time.



NATIONAL ENERGY BOARD ACT

Hon. George H. Hees (Minister of Trade and Commerce) moved: for leave to introduce Bill No. C-113, to amend the National Energy Board Act.


Paul Joseph James Martin: Explain.


George Harris Hees: Mr. Speaker, the purpose of this bill is to make necessary amendments to certain clauses in the National Energy Board Act that was passed two years ago.


Paul Joseph James Martin: What clauses?


Mr. Mcllrailh:: Explain.


Mr. Speaker:: Is it the pleasure of the house that the minister shall have leave to introduce said bill?


Paul Joseph James Martin: Mr. Speaker, we have not had an explanation of the matter. The minister has simply said that this is a bill to amend certain clauses. What clauses? Can the minister give us some indication of the principle involved?


George Harris Hees: As there are a number of clauses that have to be amended, I am afraid it would take up too much time of the house to explain each clause in detail. These are technical amendments.

Motions for Papers


Paul Joseph James Martin: Is there no principle involved?


John Whitney Pickersgill: Contempt of parliament.
Motion agreed to and bill read the first time.



CANADIAN NATIONAL RAILWAYS


Hon. Leon Balcer (Minister of Transport) moved: that the house go into committee at the next sitting to consider the following resolution, which has been recommended to the house by His Excellency:
That it is expedient to introduce a measure to provide for the construction of a line of railway in the province of Alberta and in the Northwest Territories by Canadian National Railway Company from a point at or near Grimshaw, in the province of Alberta, in a northerly direction to Great Slave lake, in the Northwest Territories; to provide for the payment out of the consolidated revenue fund of a subsidy to Canadian National Railway Company equal to the cost of constructing the said line of railway, but not exceeding in any case $86,250,000, to enable the work of construction to proceed forthwith upon an agreement being completed between Her Majesty, Canadian National Railway Company, Consolidated Mining and Smelting Company of Canada Limited and Pine Point Mines Limited, the said agreement to provide, among other things, for payment to Her Majesty not exceeding $12,500,000 on behalf of Pine Point Mines Limited toward the cost of constructing the said line of railway, such payments to be based on the average annual value per ton of concentrates shipped and to commence after the completion of construction of the said line of railway and to continue for a period of ten years.


[Stage Direction]
Motion agreed to.


[Stage Direction]
Motion No. 143-Mr. Howard:
For a copy of the material collected for submission to the restrictive trade practices commission in the course of an inquiry under section 42 of the Combines Investigation Act relating to the distribution and sale of automotive oils, greases, anti-freeze, additives, tires, batteries, accessories, and related products, by director of investigation and research, Combines Investigation Act.
Hon. E. D. Fulton (Minister of Justice):: Mr. Speaker, as I explained last week the chairman of the restrictive trade practices commission has ordered that public hearings be held in connection with this inquiry. I therefore consider I am not under any disability with respect to the production of the documents and am prepared to accept the motion.


[Stage Direction]
Motion agreed to.
Edmund Davie Fulton: I table two copies herewith.



SIREN TOWER, NORTH BURNABY, B.C.

[Stage Direction]
Motion No. 148-Mr. Martin (Timmins):
For a copy of all letters and communications between the Minister of National Defence or his department and any person or persons relative to the erection of a siren tower at the corner of Fell avenue and Parkcrest drive in North Burnaby, B.C.
Motion agreed to.

[Stage Direction]
Motion No. 149-Mr. Malheson:
For a copy of any communication or communications addressed to the Minister of Finance by Mr. John T. Bryden, former director of the Bank of Canada, regarding the pension plan of the bank together with the replies to any such communications by the Minister of Finance.
Mr. Fleming (Eglinton):: Stand.


John Whitney Pickersgill: Why should this stand, Mr. Speaker?


Mr. Speaker:: No. 150-


John Whitney Pickersgill: On a point of order, Mr. Speaker, I see the hon. member in his place moving his motion.


Mr. Speaker:: Is the hon. member unwilling to allow the motion to stand?


Mr. Malheson:: I am not willing, Mr. Speaker.


Donald Methuen Fleming: Mr. Speaker, I ask the hon. member to allow this to stand because I have just this morning seen the motion and I think there should be opportunity to examine it.


John Whitney Pickersgill: Mr. Speaker, the minister has raised a point of order. These motions are of course put on the order paper, with due notice given under the rules. The minister has had the same opportunity to see this as we have to see other things, and it does not seem to me there is any reason, since the minister himself has chosen to introduce this subject, why it should stand.


Some hon. Members:: Question.


Mr. Speaker:: Order. The motion is not debatable. If the hon. member wishes the motion put, I shall put it.


Some hon. Members:: Put the motion.



FOREST FIRES, ALTA.  ARMED FORCES ASSISTANCE

[Stage Direction]
Motion No. 150-Mr. Horner (Jasper-Edson):
For a copy of all correspondence and telegrams exchanged between the government of Alberta, or any officer thereof, and the federal government since April 1960 in regard to the use of the armed forces in fighting forest fires in that province.
Inquiries of the Ministry
Mr. Egan Chambers (Parliamentary Secretary to the Minister of National Defence):: Mr. Speaker, this motion is acceptable subject to the approval of the government of the province of Alberta.


Mr. Speaker:: Subject to the limitation expressed by the parliamentary secretary, is it the pleasure of the house to adopt the motion?


[Stage Direction]
Motion agreed to.

Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, I would ask leave to revert to motions so that I may table certain correspondence.


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


Some hon. Members:: Agreed.


John George Diefenbaker: Mr. Speaker, I wish to ask leave to table copies of letters written on June 16 to the premiers of the provinces with regard to dominion-provincial fiscal relations. One of the letters that I have here is to Mr. Frost, the premier of Ontario. The other, in French, is to Mr. Lesage, the premier of Quebec. I would ask at the same time, if the house agrees, that these letters be printed as an appendix to Hansard.


Mr. Speaker:: Is it agreed that these letters be printed as suggested?


Some hon. Members:: Agreed.
[Editor's note: For text of letters above referred to, see appendix.]



FINANCE


[Stage Direction]
On the orders of the day:
Hon. L. B. Pearson (Leader of the Opposition):: Mr. Speaker, I should like to ask the Minister of Finance whether he will table the memorandum to him from the governor of the Bank of Canada dated February 6, 1961, which has now been made public, and submit it to the banking and commerce committee of this house for examination.


Donald Methuen Fleming: Mr. Speaker, I was informed just before I entered the house this morning that the governor of the Bank of Canada has released a memorandum that answers to the description given by the Leader of the Opposition. The governor has always told me

Inquiries of the Ministry that any communications passing between him and myself were confidential. I have respected that rule. I will have to examine the position in the light of the action taken by the governor this morning.


Lester Bowles Pearson: May I ask the minister
whether he has discussed with the governor the substance of this memorandum, which puts forward a program that in the view of the governor would reduce the deficit and reduce unemployment to less than 4 per cent within one year?


Donald Methuen Fleming: Mr. Speaker, the Leader of the Opposition is now seeking to discuss the contents of a memorandum which the governor of the bank evidently has released this morning. The governor has always told me that all such communications, including this memorandum, were sent to me in confidence. He has always taken the position that communications passing between him and me were confidential whether or not they were marked to that effect. I have said that I have respected that confidence.
I think I should examine the position before allowing myself to engage in discussion on it or answer questions concerning it. Obviously if there is to be complete disclosure on the part of Mr. Coyne, then I should have the right to answer and to point out the extent to which some of these observations contained in such memoranda are self serving evidence or contain proposals that would be unacceptable for various reasons. I think in all fairness, until there has been opportunity to examine precisely what the governor has been doing in these day to day or hour to hour actions and announcements of his, I should examine the position that he has always taken in the past in regard to the confidential nature of communications.


Mr. Hazen Argue (Assiniboia):: A supplementary question, Mr. Speaker. Would the Minister of Finance care to say why he has taken the extraordinary position of refusing to discuss-


Mr. Speaker:: Order. The question asked by the hon. member for Assiniboia started out in rather an argumentative way. If the hon. member has some request for factual information I suggest that he not lead off with an argument about some extraordinary position.


Hazen Robert Argue: My question for factual information is this, Mr. Speaker. Is it correct that the Minister of Finance has refused to discuss with the governor of the Bank of Canada these proposals that were presented to him on February 15?


Lester Bowles Pearson: That is the question I asked.
(Mr. Fleming (Eglinton).]


Donald Methuen Fleming: Mr. Speaker, I am glad to welcome back to the chamber the hon. member for Assiniboia.


Hazen Robert Argue: I am not sure I am glad to be
back.


Donald Methuen Fleming: The hon. gentleman may not be completely up to date with respect to the events of recent days, and he may not have fully absorbed what I have just now said to the Leader of the Opposition in reply to the question that he directed to me on the same subject.
Some of these matters have been discussed and were the subject of correspondence, as I mentioned in a statement in the house last Wednesday when the hon. member, I think, was not present.


Hazen Robert Argue: Mr. Speaker, since these further submissions have now been made, I wonder whether the Minister of Finance will allow the annual report of the Bank of Canada to be discussed by the banking and commerce committee with the minister and the governor appearing before the committee.


Mr. Speaker:: The hon. member is asking a question which to my recollection has been asked approximately half a dozen times.


Hazen Robert Argue: On a point of order, Mr. Speaker, although this question has been asked on a number of occasions I am asking it in the light of the new and extraordinary information that has now been divulged. In the light of this I wonder whether the report could now be made available to the banking and commerce committee for discussion.


Mr. Speaker:: I do not wish to prevent the minister from answering if there is any possibility of a change in the answer, but the question has already been answered a great many times uniformly in the same Way.


Paul Joseph James Martin: Speaking to the point of order, Mr. Speaker, if I may, I submit with great respect that the question asked is in order. It is true that I have repeatedly asked the Minister of Finance whether he would allow the governor of the Bank of Canada to be interrogated by the banking and commerce committee. But in the document which was circulated by the governor this morning he makes this statement on the first page-


Mr. Speaker:: Order. It would not be regular to allow the hon. member to introduce an extraneous matter in relation to a point of order; that is, a substantial matter. The question relates to the business of the house. Unless the minister wishes to answer the question I suggest to hon. members that it has been asked often enough that there is

no need to repeat it further. It takes up the time of the house unnecessarily. The question is the same question asked before relating to the submission of the report of the governor of the Bank of Canada to the banking and commerce committee, as I understood the hon. member's question. Is that correct?


Paul Joseph James Martin: With great respect, Mr. Speaker, it is not the same question-


Donald Methuen Fleming: Mr. Speaker, the question was directed to me, and perhaps I could save the time of the house.


Paul Joseph James Martin: I am speaking to the point of order.


Mr. Speaker:: Order. If the hon. member had not concluded his remarks relating to the point of order when I interrupted him,
I shall hear the hon. member and then the minister.


Donald Methuen Fleming: Mr. Speaker, I thought I might save the time of the house and save you from having to listen to the same question that has been asked so many times and the same answer which has been consistently given by the minister. This question has been asked many times and if it were directed to me again this morning I would give the same answer I have given on every other occasion when the question was raised.


Lester Bowles Pearson: Mr. Speaker, on the point of order, surely it is not an extraneous matter when the governor of the Bank of Canada says that for four years-


Mr. Speaker:: Order. If the Leader of the Opposition introduces remarks, statements or propositions from the statement of the governor of the Bank of Canada he will be seeking to introduce a discussion of these matters which to my mind would be irrelevant in relation to the point that has to be decided. Presumably the minister knows what is in the communication. If the question is asked of the minister whether in the light of the communication which has now been revealed he would consider referring the report of the Bank of Canada to the committee on banking and commerce, that is the same question that we have had, as I said, at least five times, and there could be a great many variations of support for the argument; but to my mind it is irregular to introduce a discussion of the subject matter which might be so referred.


Lester Bowles Pearson: Surely, Mr. Speaker, the privileges of the house are involved. The governor of the Bank of Canada makes public a statement which bears on the action taken by the government in response to previous
Inquiries of the Ministry questions regarding the submission of this matter to a house, committee, because in this submission the governor of the Bank of Canada-


Donald Methuen Fleming: Mr. Speaker, the hon. member now wants to introduce the statement which he attempted to introduce earlier.


Hazen Robert Argue: It is time the minister was thrown out again.


John Whitney Pickersgill: The minister is very thinskinned.


Mr. Speaker:: Order. I expect hon. members in discussing the point of order to observe the proprieties, namely that they should not endeavour on a point of order to introduce matters contained in the statement.


Lester Bowles Pearson: Mr. Speaker, on a question of privilege, it is quite true that we on this side of the house have brought up this matter on several occasions, but it is also true that the governor of the Bank of Canada, dealing with this particular matter of the submission of the annual report of the Bank of Canada to a house committee, has made a public statement to the effect that the minister refuses to allow this to be done-


Some hon. Members:: Order.


John Whitney Pickersgill: There was a time when hon. gentlemen opposite cared about the privileges of this house, or at least pretended to.


Mr. Speaker:: Order. If I were to permit the Leader of the Opposition to refer to what the governor has said in this statement with which the Minister of Finance has declined to deal until he has had an opportunity to consider it further, I would then have to admit the whole of the statement and there would be no limit to the discussion that might take place. I rule the question out of order.


Paul Joseph James Martin: Mr. Speaker, on a question of privilege, the governor of the Bank of Canada is a public official appointed by the board of directors of the bank and responsible to parliament. This morning the governor made a statement which affects the lights of parliament. He has said that on four occasions-


Some hon. Members:: Order.


Mr. Speaker:: Order. I think the hon. member should establish that there is a question of privilege before he makes statements which are obviously objected to and would be argued against.
6532	HOUSE OF
Inquiries of the Ministry


Paul Joseph James Martin: Mr. Speaker, I shall endeavour to comply with what I think is a proper request of the Chair. The fact is that the governor of the Bank of Canada is responsible to parliament under the Bank of Canada Act. This fact has been acknowledged repeatedly this session by the Minister of Finance. Parliament, through some of its members, has sought this session to have the governor appear before the banking and commerce committee. Because of our procedures it is not possible to arrange for that-


Mr. Aiken:: Mr. Speaker, I rise on a point of order.


Mr. Speaker:: Order. Would the hon. member for Essex East, who is raising a question of privilege, allow the hon. member for Parry Sound-Muskoka to intervene on a point of order?


Gordon Harvey Aiken: Mr. Speaker, my point of order is this. A question of privilege does not arise by way of appeal from Mr. Speaker's ruling. Your Honour has made a ruling, and I think that should be the end of it. The hon. member is merely raising a question of privilege which arises out of your ruling. I submit that he is not permitted to do so. However, this is exactly what he is doing. If he wishes to appeal your ruling, that is a different question.


Mr. Speaker:: What the hon. member says is not necessarily true. What might not be a point of order might very well be based on circumstances which involve a question of the privileges of the house. I wish to satisfy myself whether there is a question of privilege as the hon. member for Essex East asserts, and I think I should hear what he has to say providing that he observes the proprieties.


Paul Joseph James Martin: Mr. Speaker, I wish to make it clear that I have not risen to appeal your ruling. That has not been thus far our practice in this house, because of the high regard we have for the way in which Your Honour has conducted our proceedings. Let that fact be very clear to the hon. gentleman. I rose on a question of privilege, and in substantiation of my right to do so, I was in the process of indicating that members of this house had this session sought to resort to procedures by which they might examine the report of the governor of the Bank of Canada and the governor of the bank himself.
Your Honour will be familiar with the steps we have taken in that regard. Questions were put to the distinguished chairman of the banking and commerce committee. Questions were asked of the Minister of


Finance if he would stand in the way of the realization of this particular objective. He replied to the contrary and said no, that he would not object. Notwithstanding that fact, it has not been possible for us to examine the governor of the Bank of Canada, who now affirms that he was prepared-


Some hon. Members:: Order.


Mr. Speaker:: Order. The hon. member should not introduce affirmations by the governor of the Bank of Canada.


Paul Joseph James Martin: Am I not permitted-


Mr. Speaker:: What the governor of the bank chooses to affirm or not seems to me to have no bearing on what decision this house makes.


Paul Joseph James Martin: May I deal first by way of digression with this last point which I think is fundamental to this whole question. Your Honour has said that what the government has said in that regard is not germane. If the governor of the bank is responsible to parliament and if parliament has been endeavouring to try to set up a procedure under which to examine the governor, what is contained in a public document made public today is a matter of the greatest concern to parliament. The Minister of Finance understandably may not be in a position to reply if the document has only come to him within a short time, but it is a public document now and it goes to the very vitals of the rights of parliament.
I am rising on a question of privilege in order to enunciate that we have the right now, in the face of this new evidence, to ask the Minister of Finance whether he will not facilitate the setting up of a committee of this house so that we can examine into the statements made this morning, among others, by the governor of the Bank of Canada with regard to the intransigent position taken by the Minister of Finance.


Mr. Speaker:: The hon. member's point of privilege comes to the same position as the question which was asked and which the minister, in discussing the point of order taken at that time, has indicated he would answer in the same way as before.


John Whitney Pickersgill: I should like to ask the Minister of Finance whether his reluctance to publish Mr. Bryden's letter is because it discloses that the minister misled the house last Wednesday?


Donald Methuen Fleming: Mr. Speaker, we have heard something this morning about privilege, and you had a speech by the hon. member for Essex East smuggled in on that subject. You have just heard now from the hon. member for Bonavista-Twillingate an attempt of a kind that is made by him in particular, and others of his ilk in the house, to defy and to break the rules of the house. The purpose of this question was not to obtain information. That fact is perfectly patent to everyone in the house. The purpose was to try to throw a slur and a smear.
Let me say that when this question was raised this morning by the hon. member who brought in the motion for the production of papers, I asked that the matter stand. The hon. member for Bonavista-Twillingate did not even wait for the member who sponsored that motion, namely the hon. member for Leeds, to say whether or not he agreed to let the matter stand. The hon. member for Bonavista-Twillingate jumped up-


Mr. Speaker:: Order.


Donald Methuen Fleming: -and prevented that motion from being allowed to stand so that it could come up later.


Mr. Speaker:: Order. It seems that one irrelevance is leading to another. The house decided against the production of the document, and I think it would be improper for the hon. member for Bonavista-Twillingate to question the decision of the house by asking an oral question which throws doubt on it.


John Whitney Pickersgill: I rise on a question of privilege. The minister chose to make insinuations about my motives.


Some hon. Members:: Oh, oh.


John Whitney Pickersgill: The minister is entitled to have any ideas he likes about my motives, but under our rules he is not entitled to express them in this house, and he should withdraw those insinuations. However, I am not going to waste my time by asking him to do so. I can tell him that he can resolve this whole question by publishing that letter and revealing to us whether or not he misled the house, as I think many people feel he did.


Some hon. Members:: Oh, oh.


Donald Methuen Fleming: Mr. Speaker, you have allowed the hon. member for Bonavista-Twillingate now to make another statement following the statement he made previously which was clearly a breach of the rules of the house. I can tell him that he will make a contribution to the fuller understanding of
Inquiries of the Ministry this whole issue by all members of parliament if he refrains from these calculated attempts to smirch and smear.


John Whitney Pickersgill: And the minister talks about smears!


Mr. Herridge:: I wish to ask a supplementary question.


Mr. Speaker:: Is it supplementary to the last dispute we have had?


Herbert Wilfred Herridge: No, Mr. Speaker. It is another dispute.


Mr. Speaker:: If it is a new question, I recognize the Leader of the Opposition.



THE CENSUS

[Stage Direction]
INQUIRY AS TO QUESTION 26 ON FORM 2a
On the orders of the day:
Herbert Wilfred Herridge: Mr. Speaker, as a long time champion and defender of women's rights, prestige and prerogatives, I wish to direct a question to the parliamentary secretary to the Minister of Trade and Commerce. My question is based on a complaint from a lady constituent of mine who served with the British, French and Belgian armies in world war I. Her complaint is that question No. 26 of census form 2A makes no provision for the recording of wartime service by women. This question reads as follows:
26. Did you ever have any wartime service in the active military forces of Canada or allied countries?
The form states: "Question 26 for all males 25 years of age and over". Can the parliamentary secretary inform the house of the reason for this serious and irritating omission?


Mr. E. L. Morris (Parliamentary Secretary to the Minister of Trade and Commerce):: Mr. Speaker, this question relates to a detail and it seems to me that it might be more appropriate to put it on the order paper.


Herbert Wilfred Herridge: Mr. Speaker, I wish to ask a question of the parliamentary secretary to the Minister of Trade and Commerce supplementary to the one I asked him previously. In view of the fact that I promised this lady, of whom I am very fond, that I would get an answer for her today, could he possibly give me an answer this morning?


Edmund Leverett Morris: Mr. Speaker, question 26 in form 2A of the population census reads:
Did you ever have any wartime service in the active military forces of Canada or allied countries?
In what war(s)?
In what forces?
6534	HOUSE OF
Inquiries of the Ministry
This question has been included in the 1961 census of Canada at the express request of the Department of Veterans Affairs. Similar statistics which derived from information collected in the 1951 census of Canada have been found useful to that department in the preparation of estimates for administrative purposes.
Since the question would have had to be asked of some five million adult females in order to produce fewer than 50,000 affirmative answers, it is extremely doubtful whether the result would be a useful statistical summary. The question was asked of adult females in the census tests of 1959, which hon. members will recall were taken in Galt and Joliette, but the result was not found to possess that degree of accuracy which is desired in census taking.
I should add that with this sort of ratio of less than one in one hundred, the information, if it should be required in the future-and the Department of Veterans Affairs have said that they do not presently require it; that they have quite accurate records of adult female veterans-the opinion of the dominion bureau of statistics is that with this sort of ratio there are probably better ways of getting that type of information as to access to the census.



EUROPEAN COMMON MARKET


[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: I should like to ask the Prime Minister whether it is a fact, as alleged in the London Times, that the visit of the secretary of state for commonwealth relations to Canada, which was to have begun this Friday, has had to be postponed until after he has visited Australia and New Zealand because, according to this report, of the internal political commitments of Canadian ministers.


John George Diefenbaker: Mr. Speaker, there are many
reports that appear. I have noticed on occasion that the papers in London publish statements made by their representatives here in Ottawa that bear no resemblance to the facts. This is another example of that type of thing. Originally there was some suggestion that the secretary of state for commonwealth relations would come here in the latter part of June. Then it became inconvenient. Finally it was decided that it would be most acceptable to both parties if he would come a little later on. That question asked by the hon. gentleman is founded on another of those reports which


too often emanate from the correspondents here in Ottawa, and which have no relation to the facts.



REPORTED DISCUSSIONS RESPECTING PACIFIC COMMON MARKET

[Stage Direction]
On the orders of the day:
George James McIlraith: Mr. Speaker, I should like to direct a question to the right hon. Prime Minister. The question arises out of press reports suggesting that steps or discussions are taking place concerning the organization of a Pacific common market. My question is this. Will the Prime Minister advise the house whether the government has taken any steps toward the establishment of a Pacific common market.


John George Diefenbaker: Mr. Speaker, as the hon. gentleman says, there were press reports to the effect that consideration was being given to a free trade area for certain Pacific countries, including Canada. May I say at once that I am not aware of any foundation for these reports, and there is nothing in them so far as the Canadian government is concerned.



CAPE BRETON


[Stage Direction]
On the orders of the day:
Mr. Robert Muir (Cape Breton North and Victoria):: Mr. Speaker, I should like to direct a question to the Prime Minister. Can the Prime Minister advise the house whether he has received a communication from the secretary of Florence local No. 4544 of the united mine workers of America, requesting that he use his office as Prime Minister to take the necessary action to extend the operation of Florence colliery, scheduled by the company for closure on July 2, 1961? If so, would he advise what consideration has been given to this request.


John George Diefenbaker: Mr. Speaker, I did receive such a letter, and I will make a statement to the house at the proper time. The hon. member and other hon. members from Cape Breton have continued to bring before the government their ideas with regard to this situation in that island.
I can only say that concerning the operation of the mines that is a matter the government cannot determine, being purely the undertaking of a private company. However, concerning action to meet the general situation, on Saturday I made an initial report setting forth what was being done, and as further steps are taken the house will be advised.


John Whitney Pickersgill: Mr. Speaker, I wonder whether I may put a supplementary question to the Prime Minister. I recognize at once that the government cannot direct the company, but would the government consider making representations to the company that the Florence mine be kept open until the alternative employment he forecast on Saturday is actually available?


John George Diefenbaker: Mr. Speaker, there have been continuous discussions among the company, labour representatives, municipal representatives, the Minister of Labour and other ministers. Naturally we would welcome any action along that line, but as the hon. gentleman was very fair and very frank to admit, we have no power of "dirigisme", an expression that was used last September or October, I think, at a well known meeting at Queen's University.


John Whitney Pickersgill: That is a new one on me.



BUSINESS OF THE HOUSE


[Stage Direction]
On the orders of the day:
Mr. W. M. Benidickson (Kenora-Rainy River):: Mr. Speaker, I should like to direct a question to the Minister of Finance. It relates to a notice of motion for production of papers, but not the one upon which the house reached a decision. I refer to No. 147. In view of the presentation of the budget tomorrow evening and the proposed resumption of the debate on Thursday, would the minister endeavour to comply with this motion at the next opportunity, which I take it will be Wednesday?


Donald Methuen Fleming: Mr. Speaker, I presume the motion must first be passed before I could be expected to carry it out.


John Whitney Pickersgill: Are you going to oppose it too?


Donald Methuen Fleming: Both these motions, No. 146 and No. 147, stood this morning.



FINAL PAYMENT ON 1959-60 POOL

[Stage Direction]
On the orders of the day:
Hazen Robert Argue: Mr. Speaker, I should like to direct a question to the Prime Minister. I had originally intended to ask it of the Minister of Agriculture, but I see he has been called out of the house. My question is this. In view of the fact that the announcement of the final payment on the
Inquiries of the Ministry
1959-60 wheat crop has been delayed beyond the time when final payment announcements have usually been made, and further because of the very disastrous situation with regard to grasshoppers and cutworms on the prairies and the increased cost to producers who have had to spray for these insect pests, would the Prime Minister use his good offices to see that announcement of the final payment is made immediately?


John George Diefenbaker: Mr. Speaker, I think the suggestion of the hon. member has been made by practically all hon. members from the province of Saskatchewan. They have pointed out the situation there caused by grasshopper infestation. However, when the payment shall be made rests with the wheat board. 1 know the Minister of Agriculture has been in touch with the board, and it will provide the information at the earliest possible date.


Hazen Robert Argue: A supplementary question. I appreciate the Prime Minister's answer, but I wonder whether it is correct to assume from his answer-and I hope it is not-that the account has not yet been closed, because first it has to be closed before the payments are made some weeks later. I am wondering whether the account has now been closed.


John George Diefenbaker: The hon. gentleman
knows as well as I do the procedure that is followed in closing the account.


Hazen Robert Argue: The Minister of Agriculture announced some weeks ago that the payment-


Some hon. Members:: Order.


Mr. Speaker:: Order.


Hazen Robert Argue: -would be made soon, and I regret very much that the announcement has not been made yet.


Mr. Speaker:: Order. The hon. member could not fail to hear me calling for order, and I would appreciate it if he would resume his seat when I call order.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Port Arthur):: Mr. Speaker, I should like to direct a question to the Minister of Defence Production. In view of the isolated nature of the Moosonee community, what consideration is being given to permitting the carpenters who went on strike today at Moosonee to stay in their present

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bunkhouses, which I understand are owned by the crown and are under the minister's administration.


Hon. Raymond O'Hurley (Minister of Defence Production):: Mr. Speaker, as this dispute is under the Ontario labour department, and since when this contract was awarded to Carter Construction Company they were given the use of these buildings- it was part of the contract-we feel it is not our responsibility to intervene in the dispute. We hope very much the strike will be settled as quickly as possible, but we do not feel we should intervene in any way whatsoever in either the lodging arrangements in the buildings or in the dispute.



IMMIGRATION


[Stage Direction]
On the orders of the day:
John Whitney Pickersgill: I should like to ask the Minister of Citizenship and Immigration whether either the hon. lady or her department or the government have received any approaches from the United Kingdom government concerning a restriction of Canadian immigration to the United Kingdom?


Hon. Ellen L. Fairclough (Minister of Citizenship and Immigration):: No such approach has been made to my department.



CRIMINAL CODE

Edmund Davie Fulton: the second reading of Bill No. C-110 to amend the Criminal Code.
He said: It is not easy in dealing with an amending bill of this nature, which covers a variety of subjects under the Criminal Code, to make a second reading speech concerned strictly with the principles of the bill. There are, however, three or four major matters which are covered by this measure, and it may be helpful to hon. members if I outline those parts of the bill which are of the greatest importance and of the greatest interest both to them and to the country.
I should like, therefore, to outline, first of all, the changes which are being made in those provisions of the Criminal Code which deal with criminal sexual psychopaths, a term which we are now changing to "dangerous sexual offenders". Then I will deal with two or three other matters covered by the bill, including the operation of small vessels, habitual criminals generally, and so on.
The first subject, and the one which will be of the widest interest and importance, is that relating to the criminal sexual psychopath.

The problem of the sexual offender is a most complex one. As the house knows, in 1954 a royal commission was appointed under the chairmanship of Mr. Justice McRuer, chief justice of the high court of Ontario, to study the question and make representations with respect to the criminal law relating to criminal sexual psychopaths. This commission presented its report to me in 1958, and that report has been the subject of consideration and study in my department and by the government ever since.
In dealing with the subject it might be helpful if, first of all, I endeavour to outline the problem itself. After that I will describe the amendments which we are placing before the house for its consideration. Finally I shall turn to a difficult question and one which is not covered by the amendments, namely the question of providing for clinics, education and research in this field.
Probably the best way I can give to the house an outline of the scope of the problem is by borrowing from the words of the royal commission itself as they appear at page 59 and following of its report. The commission describes it as follows:
Although sexual offenders cannot be precisely classified, they may be divided into two general groups-those who are a danger to the public and those who are not dangerous but are distinct nuisances. In this inquiry we are primarily concerned with the first class. The legislation we are considering has special application to those who, by reason of some limitation on their power to control their sexual impulses, are likely to be dangerous to society. The principle of preventive detention underlying the law is twofold-segregation to prevent injury to others, and treatment if possible so that the prisoner may ultimately be safely released.
It appears to us that there is no reason why a convicted sexual offender who suffers from no mental disorder impairing his free will and ability to restrain his sexual impulses should not be treated as any other criminal. There always have been and probably always will be in society individuals who seek to fulfil their selfish desires and accomplish their selfish ends through trespass on the legal rights of others.
Again, the royal commission said:
The sexual crimes included in section 661 of the Criminal Code are all crimes affecting the person and are either of a violent or of a corrupting nature which may have devastating effects on the victims, particularly if committed against children.
The amendments which we are proposing to the law on this subject are to a large extent based upon the report and recommendations of the McRuer commission as those recommendations were considered in detail by the commissioners on the uniformity of the law. I should explain that we are not at the present time adopting every one of the recommendations or every part of every recommendation made by the royal commission, but in large part the amendments which I am presenting do proceed from the studies of the royal

commission as amended, or in some cases modified, by the study of the uniformity commissioners.
I should say at once that we do agree entirely with the finding of the McRuer commission that the law as it stands now is not accomplishing its purpose, and, further, we agree that this failure, as the royal commission says, may be due to one or more of three causes; first, the phraseology of the law; second, the lack of proper enforcement of the law; and third, the reluctance of the courts to commit a person to imprisonment for an indeterminate term, especially where there are no arrangements made for custody and treatment of the prisoner apart from those provided for prisoners serving determinate sentences.
There are a number of the amendments which, while arising out of the report of the royal commission, take the form which they have in this bill as a result of the work of the commission on the uniformity of legislation. These are designed to strengthen the provisions of the Criminal Code in relation to this matter and to make them more workable and effective. There is, for instance, the change in the description of the offender from "criminal sexual psychopath" to "dangerous sexual offender". This is based on the report of the royal commission, concurred in by others, that the use of the word "psychopath" is not appropriate because it gives rise to difficulties and misunderstanding between experts in the field on the one hand, particularly when they are called upon to give evidence, and layment, comprising the jury, on the other hand.
It seemed to us to be desirable to adopt a more simple and less technical definition as being less liable to create technical and unnecessary controversy, especially if, as we believe is the case, it is possible to find a phrase which describes the situation we are trying to deal with in non-technical language. With the assistance of the royal commission, we think the words "dangerous sexual offender", based on the reasoning which that commission adopted, do accomplish the purpose of giving a better definition of the type of offender with whom the law is attempting to deal.
Further, we have adopted not only a new terminology in this respect but also a new definition of what constitutes an offence. The present definition of a criminal sexual psychopath is:
A person who, by a course of misconduct in sexual matters has shown a lack of power to control his sexual impulses and who as a result is likely to attack or otherwise inflict injury, pain or evil upon any person.
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The new definition of "dangerous sexual offender" is:
A person who, by his conduct in any sexual matter, has shown a failure to control his sexual impulses and who is likely to cause injury, pain or evil to any person, through failure in the future to control his sexual impulses or is likely to commit a further sexual offence.
I have already dealt with the reasoning behind the change in terminology. As to the change in the definition, the purpose is to make it clear that a court, in an appropriate case, may make a finding that a person is a dangerous sexual offender on the basis of one offence. It was suggested in the evidence before the royal commission that much of the reason why courts have not found, or apparently have not found, the present provisions with regard to a criminal sexual psychopath effective to restrain in custody under treatment those who are guilty of this type of offence is that the law at present makes it necessary to prove a course of conduct probably extending over some years. This has the effect of importing into the law in this field, that which should not be imported and which might be likened to the principle that every dog is entitled to his first bite; whereas it is felt by the commission, and with this line of reasoning we agree, that in dealing with offences that are potentially dangerous and damaging to others, as is the kind of offence embraced in the words "dangerous sexual offender", it should not be necessary to wait until there is a second or subsequent offence, but that the the law itself should define the offense in such terms as to make it possible for the courts, aided by expert medical and psychiatric evidence, to sentence offenders to indeterminate sentence for treatment if, on the basis of that evidence, they come to the conclusion that the offender comes within that definition, whether or not there has been a previous offence.
Another purpose of the change in the definition has been to avoid the extreme difficulty of proving lack of power to control as compared with simply failure to control. After all, what we are concerned with here are the consequences to society of the crime or the offence. Our objective is to remove the offender, thus protecting society on the one hand, and providing treatment for the offender on the other. Therefore it seems immaterial whether the offence is the result of a complete lack of a power to control, requiring technical and very difficult proof, or whether, as is certainly the case whenever this sort of offence is committed, it simply results from failure to control.

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Another purpose of the change in the definition has been to eliminate the implications of coercion contained in the word "inflict". The evidence before the royal commission contained considerable examples of differences of opinion on this point and, indeed, the commission itself referred to a case in the Supreme Court of Canada where the judges of the supreme court themselves were divided on the question of whether or not the words "inflict damage or evil" imported a necessary element of coercion. We felt it was not essential to the determination of the matter to enter into an analysis of whether or not a person, in respect of whom an application has been made to have him declared a dangerous sex offender, may cause the damage in the future by physical coercion or oy mere persuasion and temptation. It does not seem to make much difference what method is resorted to, but it is again the possibility of evil and damage which must be borne in mind here, as well as the elimination of the possibility of that evil or damage. In connection with this particular point, inclusion of the words "or is likely to commit a further sexual offence" was the proposal of the uniformity commissioners.
Again, the amendments relating to dangerous sexual offenders will also clear up the question as to when, in relation to the time of conviction, the application to have a person declared a dangerous sexual offender may be made and the notice of such application must be given. A new provision is included that such an application may be made upon notice thereof being given at any time not later than three months after conviction for the offence giving rise to the application. Under the existing law an application had to be heard before the passing of sentence for the offence giving rise to the application.
It will be noted that we have accepted the argument of the royal commission that the making of an application to have a person declared a dangerous sexual offender should not entitle that person to change his plea if he has already pleaded guilty to the specific offence upon which he is at that moment in court. We have accepted that point of view, but we have gone further. I think in fairness to the house I should point this out, because it should be in the minds of hon. members as they discuss this matter.
We have gone further and provided that the crown may make the application to have a person declared a dangerous sexual offender after he has been convicted, but not more than three months after conviction, and limited in any event, to the time which the offender or convicted person is serving under his sentence. In other words it will
not be possible for the sentence to have expired or have been served in full then for the crown to reach out and make an application based on the previous conviction. However, provided a person is still in custody or, if sentence has been suspended, provided that the sentence is still in effect, and within the limit of three months after conviction, the crown may make application to have that person declared a dangerous sexual offender.
I should like to add a few words on the sentencing of persons adjudged to be dangerous sexual offenders. Under the present law the court, upon adjudging a person to be a criminal sexual psychopath, now to be described as a dangerous sexual offender, must sentence him to a term of imprisonment of not less than two years, and in addition may impose a sentence of preventive detention. The amendment now before the house will eliminate the determinate portion of the sentence because, in our view-and again here we agree with the royal commission-it seems inappropriate to couple a determinate sentence with an indeterminate sentence or a sentence of preventative detention, the main purpose of which is segregation and treatment. I think the reasons for this decision are best explained by the royal commission itself as found at page 65 of its report, which reads as follows:
The mandatory minimum sentence of two years in prison, to be followed by an indeterminate period of preventative detention as required by section 661 C.C., not only eliminates any opportunity of treatment of the prisoner as an out-patient while on suspended sentence, but makes it obligatory that both the determinate and indeterminate sentences be served in a penitentiary. The only qualification is that the prisoner may be confined to a part of a penitentiary set apart for prisoners servicing indeterminate sentences of preventative detention. In theory the sexual offender who comes within this branch of the criminal law is one who at least suffers from some abnormality affecting his sexual impulses. If he does not suffer from any abnormality he does not come within the scheme of the law and should be dealt with as any other convicted person.
Then it continues as follows:
The custody of habitual criminals was discussed in the report of the royal commission investigating the penal system of Canada.
I interpolate here, Mr. Speaker, to point out that their reference is to the Archambault commission which reported in 1939 and not the Fauteux commission, which reported in 1955 or 1956. Then to continue the report:
The recommendations are (1) the sentence of preventative detention should become effective at once and not on the expiration of any other sentence and (2) segregation in an institution away from other offenders.
Then the McRuer commission continues as follows:

-the purpose of the prison (in the case of habitual criminal) is neither punitive nor reformative but primarily segregation from society.
Again the McRuer commission makes this express finding:
All that is said in the Archambault report applies with greater force to the treatment of one who is undergoing preventative detention as a "criminal sexual psychopath", except that segregation should be acompanied by all possible treatment.
These, Mr. Speaker, are the main effects that we hope to attain by the amendments to the law on sexual offenders; that is, the segregation of any person who, as a result of his conduct in any sexual matter, may be determined to be persons likely to commit a sexual offence in the future and thereby liable to cause damage or suffering to any other person. We are concerned with his segregation first, but also his segregation for the best treatment we can devise for him and which is within the limits of our ability to administer in our penal institutions.
This is, however, only the first stage toward the solution of a very complex problem. The reformation, in this case the treatment, of the inmate is only one essential part of any rehabilitation program. The segregation of these offenders, however, will not serve any long term desirable results if the sexual offenders are not treated, so this leads naturally and I think inevitably to a discussion of the establishment of diagnostic and treatment centres, the early detection of cases and the organization of research.
I think it is essential, before I outline the work being done in this field, to draw your attention, Mr. Speaker, to the state of present medical knowledge of this disease. As pointed out by the McRuer royal commission:
The public should understand that it is not possible to speak with assurance about curing the class of offenders we are considering. Many of the medical witnesses who were in a position to speak with great authority took a pessimistic view of the prospects of obtaining satisfactory results from any known form of treatment.
The report went on to state:
Notwithstanding these pessimistic views, we think that a positive attitude toward the problem is of great importance, and a positive attitude demands more than mere custodial care for the prisoners we are discussing. We are convinced that with custodial care must go definite progressive methods of the application of all known helpful means of treatment and the development of new means.
The royal commission recommended that special provisions be made in the penitentiary system for the custody, control and treatment of every sexual offender undergoing preventive detention. In regard to these suggestions I wish to say that the penitentiaries branch is actively engaged on a policy of increased psychiatric attention for all classes of prisoners, including dangerous sexual offenders,
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who appear to be in need of such treatment, and in connection with such policy the penitentiaries branch is studying the best methods of applying such treatment, including the question of how and where dangerous sexual offenders should be confined. In implementing this policy the penitentiaries service is at present restricted by the difficulty of obtaining the services of psychiatrists, and by the limitations of the detention facilities at present available.
It will be remembered that the proportion of dangerous sexual offenders in the prison population is relatively small. No particular question or problem of escape from custody appears to be involved. It will also be remembered that while it is generally recognized that every reasonable attempt should be made to give treatment to those cases willing to receive it and likely to profit from it, psychiatric treatment cannot by its nature be forced upon a prisoner or patient. The McRuer report itself points out that the outlook for successful treatment of those who are not prepared to co-operate in such treatment may be bleak.
The royal commission has recommended that special clinics be set up in co-operation with the courts. In view of the relatively small number of dangerous sexual offenders actually charged and convicted as such, and the high proportion thereof who will be sent to penitentiary in any event; in view also of the fact that the penitentiaries have and are constantly improving the psychiatric services for dangerous sexual offenders, we feel it would be unreasonable and unnecessary duplication at this time to incur the expense of establishing special clinics not part of the penitentiaries system. Furthermore, the establishment of such clinics in what would be really a purely health field is essentially a provincial responsibility.
Although the problem of establishing separate clinics to examine and treat persons who may become dangerous sexual offenders is essentially provincial, the Department of National Health and Welfare is deeply concerned and is approaching the provincial authorities for the purpose of creating interest on their part and discussing with them the manner in which provincial facilities for such diagnosis and treatment outside the penitentiaries system can best be utilized in connection with this problem.
The McRuer commission also suggested a program of education of parents, teachers and all those in charge of young persons, urging them to co-operate with clinics established on the basis, for instance, of the forensic clinic of Toronto so that all known effective measures might be taken to arrest the development in young persons of tendencies toward

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sexual deviation. Again, this is mainly a problem for the provinces to tackle, but the department of my colleague the Minister of National Health and Welfare is concerned about the problem and is approaching the provincial authorities for the purpose of finding the most efficient and effective solution to this problem. There is indeed urgent need in Canada for research into all aspects of sexual deviation with a view to development of means of correction and prevention. The question of the possible participation by the federal government is under active consideration by my colleague at the present time.
I hope I have succeeded in outlining to the house, in a necessarily brief compass, something of the nature of the problem and of our approach to it, which recognizes that amendments to the law should be based on the principle, first, that a court should be empowered to find a person a dangerous sexual offender on the basis of one offence if the medical evidence indicates that he is a person who is likely to repeat that kind of offence; and second, that the object of the law should be to provide for the segregation of this type of offender for two reasons, on the one hand the protection of society while he is segregated and, on the other hand, the application to him to the greatest degree possible of effective methods of reformation and treatment designed to assist him in curing his deviation so that he may ultimately, in appropriate cases, be released to society without danger to himself or the members of society.
It is, however, always necessary to sound a word of caution in this field as in other related fields. It must be recognized that the dangerous sexual offender is a sick man for whom no assured treatment exists as yet. I should also repeat that, based on the preponderance of medical evidence, it is possible to diagnose "an individual as having a psychopathic personality but we have no specific way of determining what type of anti-social activity he will display". That is actually a quotation taken from the evidence of Dr. Frederick van Nostrand, as it appears in the royal commission report at page 93. So this is a difficult and complex problem about which it is not safe to say with certainty that this or that measure will produce the answers. However, in our view it is a problem with respect to which it is essential to make a beginning, and we trust members of the house will agree that this legislation represents an effective approach to the problem.
I should like to pass now to a discussion of one or two of the other more important amendments found in the bill before the house, the first of them having to do with

habitual criminals generally. The house will appreciate, of course, that the provisions with regard to dangerous sexual offenders, about whom I have up to now been speaking exclusively, are, of course, found in that section of the code dealing with habitual criminals generally, and we have amendments here relating to that subject as well.
One amendment to the provisions relating to habitual criminals parallels the amendment relating to dangerous sexual offenders, in that it permits a notice leading to an application to have a person declared an habitual criminal to be made at any time up to three months following the imposing of the sentence for the offence that gives rise to the application.
Another parallel amendment eliminates the determinate sentence in the case of a person found to be an habitual criminal and sentenced to preventive detention. In the future, when a finding is made that the person concerned is an habitual criminal, the only sentence to be imposed will be an indeterminate sentence to preventive detention. I should point out that in the case of any indeterminate sentence under our new legislation, it is the parole board which determines whether and when the time may have arrived at which it is appropriate to release the person from custody and allow him to spend the balance of his sentence at large in society.
Another amendment which I am sure will be of great interest to the house generally, and perhaps particularly to lawyers, is a provision of the bill which restores the offence of dangerous driving which used to be an offence under the old Criminal Code. At the time of the Criminal Code revision, however, this offence was dropped in favour of the offence of criminal negligence in the operation of a motor vehicle. There is a long history, both in this country and in other countries, of an attempt to formulate an offence under which juries would convict, in appropriate cases, for the reckless or dangerous operation of a motor vehicle which caused death or bodily harm. Juries at one time shied away from convicting persons of manslaughter arising out of death caused by the negligent operation of motor vehicles because of the rather awesome connotation of that word.
This tendency led to the enactment, some years before the Criminal Code revision, of the offence of reckless or dangerous driving, coupled with a provision to the effect that if upon a charge of manslaughter the jury was not satisfied that manslaughter was proved but was satisfied that the other offence was proved, it might convict of that other offence. Apparently juries have tended similarly to

shy away from convicting for criminal negligence in such circumstances. At the present time, the offence of dangerous driving having been removed, it is felt, and widely felt, that there are many cases where persons who have been guilty of criminal negligence in the operation of their motor vehicles are nevertheless escaping with a much milder penalty because of the reluctance of juries to convict of manslaughter or of criminal negligence.
We are accordingly reinstating, at the request of the provinces, the old offence of dangerous driving. We are, however, omitting the word "reckless", because to employ this word seems to have the effect of elevating the offence to the same plane as criminal negligence, thus creating a distinction without a difference which would make it very difficult to charge juries.
There is also an amendment making the offence of driving a motor vehicle while the person is disqualified or prohibited from doing so by reason of the suspension of his licence by the court or a motor vehicle registrar, an offence punishable upon indictment as well as upon summary conviction, which is now the case, and imposing a more severe penalty when the charge is proceeded with by way of indictment.
Another provision in this bill, which I am sure will be of great interest, has the effect of transferring to the Criminal Code a number of provisions now found in the small vessels regulations. For some years there have been in the small vessel regulations, enacted under the Canada Shipping Act, a series of sections paralleling those in the Criminal Code relating to abuses in connection with motor vehicles; namely operating a vessel or towed object, such as water skis, dangerously or while the ability of the operator is impaired by alcohol or a drug, or leaving the scene of an accident with intent to escape liability; and providing that the court, when convicting for such offences, may make an order prohibiting the person convicted from operating a vessel for a stated period.
Of late years, as all hon. members know, the number of small pleasure craft on the domestic and territorial waters of Canada has greatly increased and a great many accidents, in some cases fatal, have recently been caused by the careless operation of such craft. We consider that this problem has now become so acute that measures to deal with it should be in the Criminal Code. While those provisions were to be found only in the regulations under the Canada Shipping Act, they have tended to be regarded as rather special provisions of interest chiefly to the Department of Transport, or at any rate to the federal government alone; by including them in the code we hope they will be recognized as an ordinary part of the criminal law made
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necessary by new conditions and will be enforced by provincial authorities in the ordinary course of Criminal Code enforcement.
There are, as will be appreciated, a number of other amendments in the bill. I think I have picked out the amendments of greatest interest and concern, at least I have endeavoured to do so, in an effort to be as helpful as possible to the house in outlining the thinking of the government which has given rise to this amending bill.
I should say also, Mr. Speaker, that it is my view, and my colleagues have agreed with me in this, that generally speaking amendments to the Criminal Code should not be made every year. It seems to me that, as nearly as possible, the criminal law should be certain. It is not desirable, then, that changes should be made too rapidly or too frequently. Every change necessarily imports the necessity for building up new jurisprudence on the change and may, in ways quite unforeseen, have the result of confusing settled jurisprudence. We do not think it is desirable in the field of criminal law that this should take place, at least with frequency.
I wish to emphasize that this does not indicate that we will refuse to consider necessary changes or to discuss with anyone the necessity for a change. It is merely that we feel, in general, changes to the Criminal Code should be made as a matter of real deliberation, and as infrequently as will meet the necessities of the case. This is one reason there is a fairly substantial bill this year. There was no Criminal Code amending bill last year.
Of course if a case in the courts or a situation in the country arises, indicating an emergency and indicating urgent necessity for an amendment, we would not then be so foolish as to say we do not believe in amending the Criminal Code every year and therefore we will not introduce such an amendment. The necessary amendment would be recommended to the house at once where there was any real necessity for it. In general, however, our thought is that there should be a Criminal Code amending bill only every two or three years. This is one of the reasons for the size of the present bill.


Julia Verlyn (Judy) LaMarsh: Mr. Speaker, in introducing the amendments to the Criminal Code the minister prefaced his remarks with an apologia to the effect that it was difficult to speak to matters of principle in connection with this bill because its 45 amending provisions deal with so many different aspects of the criminal law. I hope the minister and the house, in listening to my remarks, will bear in mind the fact that if it is difficult for the minister, who has had the bill in charge for some time, it is even

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more difficult for the opposition members who only saw the bill for the first time this morning. There are a number of remarks which I should like to make, Mr. Speaker, concerning these provisions, and perhaps I might do so in reverse order to those touched upon by the minister.
In so far as the small vessels regulations are concerned which have been incorporated into Bill No. C-110, as the minister stated those provisions have been in the law and have been the responsibility of the Department of Transport for some time. The necessity for enforcing them, therefore, has lain with the R.C.M. Police. As the minister indicated, this responsibility now passes to the provincial police of those provinces which have provincial policing authorities.
Speaking generally to the principle, I suggest that they are good provisions. They have been in the Canada Shipping Act for some time. However, care must be taken in enacting legislation not to enact it purely because it appears to meet a need or because it appears to be a good thing. This should not be a kind of "busy" work just to justify a department. Laws enacted by this parliament should be those which not only meet a need but which are enforceable.
It is well known, I think to most hon. members of the house that the R.C.M. Police have had difficulty in trying to enforce these regulations. Their numbers are comparatively small. The problem itself is acutely difficult because of the thousands and thousands of small lakes and hidden waterways within Canada. If the R.C.M.P. who have been dealing with this matter for some time are incapable of handling the matter, it is highly unlikely that the provincial police forces, which call annually for more personnel and which are annually running well behind the necessary personnel even to police the highways, will be able to provide sufficient personnel to police the waterways. When I think of the many lakes, even in the area surrounding Ottawa to which hon. members have resort on Sundays while the house is in session, and the number of boats such as those I saw yesterday speeding through the lakes with no member of a provincial police force anywhere for miles around, it seems to me that we must be careful not to congratulate the minister or the government, or not to be content that by the mere proposal and passage of a section in the Criminal Code or under the Department of Transport regulations we have thereby solved the problem. The mere fact that we have enacted legislation, unless we have sufficient policing authority to enforce it, is useless verbiage.
I would hope that the minister would be able to advise us, either now or later, of

some provisions which may be made for special policing authorities. It may be that in his discussions with the provinces, which I presume were held prior to the introduction of these sections into the Criminal Code, some arrangement has been made with the provincial attorneys general to provide more policing authorities, particularly as we are now into the summer season and there are thousands more small boats in use each year. I think this is a good provision if it is enforceable. If it is not enforceable, then it only weakens the criminal law to include it.
With respect to the provisions in Bill No. C-110 dealing with driving while under suspension, may I say that it has been my experience and, I think, that of most of the hon. members of the house who are of the legal fraternity, that the public generally does not view this offence as serious. By now making it capable of being prosecuted as an indictable offence with a vastly more serious penalty, it may be that the public generally will accept this as a more serious matter and will be deterred from driving while under suspension. To carry the same provision into the operation of a small vessel only points up, I think, how difficult it is to police those provisions with respect to small vessels. I have been told at various times by members of policing authorities that they would estimate that there are 10 drivers on the highway driving without licences or with licences under suspension for every one who is caught in the process of doing so. I imagine that these figures would be vastly greater if one were to consider those operating small vessels with licences under suspension. Again I repeat that the mere enactment of legislation is insufficient and weakens the criminal law unless there are enough provisions for enforcing it.
As to the amendment to replace in the Criminal Code the offence of dangerous driving, may I say this. As the minister knows and has mentioned, this has a long history of difficulty in the criminal law. When the act was amended in 1955 it was dropped for a particular purpose, as it was felt that there would be convictions under what was at one time motor manslaughter but is now criminal negligence in the use of a motor vehicle. As a matter of practice, as the minister has said, juries do not convict because there has been telegraphed to them the fact that this is the old motor manslaughter provision. There appears to be a feeling in the community that manslaughter is not the proper name, that it does not carry the proper intent, when connected with a motor vehicle. The public generally seems to feel that that is an almost deliberate sort of killing.

Accordingly, it may well be that there are many individuals who have been guilty of driving in a manner which has caused grievous bodily harm, in some cases death, and in other cases considerable property damage, who ought to have been convicted of some offence and to have suffered a monetary penalty or a penalty by incarceration, but who have not convicted by virtue of the fact that this section was not in the code. Its reinstitution I would suppose has been suggested by provincial authorities and would be greeted by them with some pleasure. It cannot be said, however, that defence counsel would greet it with the same pleasure.
As to the provisions respecting habitual criminals, may I say that this is perhaps the greatest single deterrent which is in our criminal law. In my experience with habitual criminals or those who characterize themselves as professional thieves or professional robbers-and there are, shockingly enough, in Canada those who pride themselves on this title-they are all afraid of what they call "the bitch". As they collect a record of convictions they come terrifyingly close to the point where a crown attorney may lay this charge. Within the brief span of my 11 years in practice, most of which has been in criminal law, I found that nothing deterred or frightened a professional criminal with a record as much as the possibility of a charge of being an habitual criminal.
I think the provision which is being instituted by this amendment is one which must be approached with caution. Although it strikes terror into the hearts of criminals-* and that is what we want for one who is an habitual criminal-we have to bear in mind that this is not an offence in the usual understanding of that term. It is a condition; what the court is asked to find is that a person is in such a condition that in fact he cannot be reclaimed to society, as indicated by a long history of convictions for varying criminal offences. Because I think we recognize that all individuals in society may commit crimes, no matter how heinous, and may be reformed, we must be careful in the use of this charge, or this application to have a person so found. Notwithstanding a long and vicious record, it is possible that some intervening act may happen to make them reclaim themselves.
The fact that now it will not be necessary to serve this notice and have the same jury which convicted an individual of a criminal offence deal with the application to find him as an habitual criminal works in two ways, or can possibly do so. One of these can certainly be as a deterrent to an individual who has been charged with an offence and has been convicted but who, in the time after conviction and prior to the expiration of three
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months, feels that he can rehabilitate himself; then shortly before the expiry of the three months he finds that the crown authorities have laid this charge against him.
I would call it one o'clock, Mr. Speaker, if I may do so.
At one o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 2.30 p.m.
Julia Verlyn (Judy) LaMarsh: Mr. Speaker, before the luncheon adjournment I was discussing some of the provisions of this bill with which the minister had dealt in the latter part of his statement. Before leaving that part of it I might make one other suggestion. Many people who have dealt with the question of habitual criminals are of the opinion that this provision is not used sufficiently. I do not have the statistics, nor has the minister placed them before us, of the number of habitual criminal convictions which have been obtained in Canada since this provision was put into the Criminal Code. However, I have heard it discussed at various times by those involved in the administration of justice, and I have heard the suggestion that there should be a definite time laid down after which there should be no discretion in the crown attorney. In other words, on the third or fourth criminal conviction there must be an application made to the court to find the individual concerned to be one who is an habitual criminal. I wonder if the minister, when he discusses this matter later, would comment on whether this suggestion has been considered by the department and what the rationale of the department was in deciding not to include it.
I should like to pass on to the clauses of the amending bill which deal with those who until now have been called criminal sexual psychopaths. My experience of this matter has been in discussing it with a member of the royal commission which was chaired by Chief Justice McRuer, a person of whom in my riding and county we are very proud, in particular those of my sex. I refer to Her Honour Judge Kinnear of the county court of Ontario, who was the first woman appointed by the previous administration to this level of the judiciary and who still remains senior in this post throughout the commonwealth and the empire.
She was a member of the commission which dealt with the difficult question of criminal sexual psychopaths, and over the years I have had the benefit of discussing this question with her. Chief Justice McRuer, who

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chaired the commission, has the widest practical criminal experience in Ontario, and the recommendations included in the report of that commission are lucid and humane. It is with some regret that I notice this bill does not include a provision for research and clinical facilities such as were recommended by the royal commission. I understand from the statement of the minister that consideration of this matter has not ceased, and that in the future it may be possible to make provision for more facilities, but the intention now is that anyone convicted as a dangerous sexual offender under these amendments will be required to go to a penitentiary.
The royal commission report is very definite on the point that this is of little real assistance and that there are two factors which keep many such offenders from becoming cured or rehabilitated. One is that most sexual offenders do not choose to be rehabilitated. This is, in many sexual offences this is a way of life which they have adopted and which they choose to pursue. The other is one which the minister mentioned, that so far medical science has discovered no real cure for one who does not wish to be changed.
Certainly the change of style from "criminal sexual psychopath" to the style in the present bill of "dangerous sexual offender" is good. In particular I think it might be interesting for the house to note that in the evidence of the psychiatrists who were called before the McRuer commission the first quotation was a remark of Dr. B. H. McNeill of the Ontario department of health, who said "I once heard a psychopath defined by a psychiatrist in the same way as he said someone defined a hippopotamus; he could not define it but he knew one when he saw it". This points up the fact that psychiatry has not as yet been able to define or pinpoint what it is that is wrong with these people and thus take a first step toward their cure. Certainly within the experience of certain criminals whom I have defended there is in the penitentiary system wide scope for abnormality of sexual experience which this bill will not cure, because even though these people are segregated within the penitentiary system there will still be opportunity for this abnormality to continue without any real treatment and without at present any real hope that they may be cured.
Many suggestions were gone into by the commission when they dealt with this subject. While it is a knotty and difficult one, partly legal and partly medical, it is encouraging, I think, for hon. members of the house to remember that the numbers involved are very small; that most of those who are guilty of sexual offences are only

what are known as common nuisances and that the really dangerous criminal offenders are very much in the minority. Thus we are legislating with respect to only a few people, although those few people are capable of wreaking great damage on other people and particularly on very young children.
We should be careful, however, when dealing with any offence which may bring about a term of preventive detention that we do not infringe on the rights of all under the bill of rights or under the natural rights of people in this country. We have to be satisfied first that there is, in fact, a condition there which cannot be cured in our present state of medical knowledge. Second, even if a cure is available it may not be accepted by the individual concerned, since it is necessary to have sympathy and empathy between the psychiatrist and his patient. Third, we must consider whether simply removing these people from society is sufficient.
We hear in this field very little discussion of points which arise in the consideration of murder, such as what is a deterrent, what is the retribution of society and what is the rehabilitation of the criminal. We admit we cannot rehabilitate these people. We deny, I think generally, that what we are asking for is retribution. I would ask the minister upon what philosophy he has based the provisions he now places before the house in order to remove these people from society for a more or less permanent period which may be the rest of their lives.
The provisions of the clause dealing with dangerous sexual offenders are generally noncontentious, inasmuch as they were largely recommended by the McRuer commission. That commission, however, did not stop with these recommendations. Ten of the 20 or more points made dealt with questions beyond the Criminal Code, in particular with the urgent need in Canada for research into all aspects of this problem and the need to develop a means of correction and prevention. The commission pointed out that the psychopathic sexual offender is no different from any other offender, that he is in effect an ill man, as the minister also pointed out. The commission drew the conclusion that our only course is simply to segregate these people from society; that we should not cover this with a feeling that we are doing something for these people who are ill, but that we must recognize that at this point there is little we can do for them even if they were willing to co-operate.
All we can do is merely remove the festering canker from society and place where it cannot be communicated. This, of course, is communicable if left in society because the

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aberrations of some individuals cause them to bring in younger and younger people, and it spreads. It may, therefore, be justifiable simply to remove them from society. However, we should not pride ourselves that because we are taking them out of society we are doing this for their good. This removing of offenders from society is nothing but punitive legislation for society's good.
The provisions of the bill are similar to those which apply to habitual criminals, in that this offence may be charged within a period following conviction. I would again caution the minister, as I did before the luncheon break, about the obvious dangers of this. Once having faced trial on a sexual offence and having been found guilty, any time within the following three months an individual may be faced with a further charge and prosecuted.
There are a number of things which were recommended by the royal commission which the government has not yet seen fit to adopt. I understand from the minister's statement this morning that unless something arises of an emergent nature it is unlikely that we shall see another amendment to the Criminal Code during the life of this parliament. The hon. gentleman indicated clearly that be believed amendments should only be introduced every second or third year. While I agree that it is very necessary to have a degree of certainty in criminal law in order that a body of jurisprudence may be built up and in order that there should be time to see how the legislation operates, I decry the rigidity of saying that unless there is something of an emergent nature we shall not amend it from time to time.
It may be that it will take more than three years for the effects of this legislation to become known. Of course if we do not pass it we shall never find out what its effects might have been. However, it may be that within a year after its passage we find that further amendments need to be brought forward, amendments more in conformity with the report of the royal commission, particularly in connection with whatever assistance may be given sexual offenders in providing research and clinical facilities and, especially, by providing a separate place in which to segregate them where they would receive treatment, rather than receiving treatment in other parts of the penitentiary where they are at liberty to move among other prisoners.


Edmund Davie Fulton: Would the hon. lady not agree that a provision of that kind would not necessarily be made by way of amendment to the Criminal Code, but more likely would be
made by other legislation, possibly under the Penitentiaries Act or within the field of responsibility of the Minister of National Health and Welfare?


Julia Verlyn (Judy) LaMarsh: I do agree with the minister that it is likely this would come in elsewhere. There were, of course, other recommendations respecting amendments to the evidence act and amendments to the Penitentiaries Act. I have not seen these on the order paper, and it may be that the minister will be bringing those in shortly.
If I may sum up, Mr. Speaker, we on this side approve in general, I would say, the adoption of the recommendations of the commission. These were reported to the Minister of Justice in 1958, and for three years now they have been available to the public, to psychiatrists and to those law officers who would be interested. The minister announced that a study had been made by the commission on the conformity of legislation. The hon. gentleman said that having had the benefit of its report he had modified the report of the royal commission, adopting some of its recommendations but not others.
We are in sympathy with stern treatment for those who as ravening monsters prey sexually on small children. We are also in sympathy with those who are ill, who have committed these offences and who wish to stop being deviates and avoid getting into such trouble again. We are in sympathy, I would say, with the principle of preventive detention, because this permits flexibility in that each person convicted of an offence may, as the individual reaches the point where he is no longer a danger, be freed without the rigidity which is necessarily so often a part of the criminal law.
We shall have remarks to make at the committee stage not only on these clauses but on other clauses with which I dealt prior to the noon adjournment. As I said at the beginning of my remarks, it is difficult to deal with the principles involved in a bill which covers so many subjects, linked only because they come under the umbrella of the Criminal Code. However, in principle the amendments are largely ones of which we approve although, as I stated before, we reserve our right at the committee stage to complain about certain of them. It may well be, Mr. Speaker, that the minister will find certain amendments being put forward, either with respect to the material now dealt with or additional material, since we have been warned in effect that we cannot expect other amendments to the Criminal Code for some years.

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Gordon Harvey Aiken: Mr. Speaker, this bill contains several principles, as the minister has indicated, and I should like to say a few words about the main ones.
I should like to refer in general terms to amendments to the Criminal Code, and draw to the attention of hon. members the progressive manner in which the Minister of Justice has brought before this house problems which have been seriously troubling many people of this country. During this session we have considered the most serious problem regarding the question of capital punishment, in respect to which there were many satisfactory proposals made and accepted by this house. The Minister of Justice has also brought forward a bill dealing with narcotics control and treatment of offenders. This involves another serious problem which has concerned many people in this country.
I suggest there are two main principles involved in the bill presently before us. The first deals with the provision of a stern code of regulations to prevent individuals from turning our waterways into speed zones and death traps when they should be used for the pleasure of individuals. The second principle embodies an effective method, which the minister has proposed, to deal with dangerous sexual offenders. There is of course also the provision having reference to the reinstatement of the dangerous driving section of the Criminal Code, to which I should like to refer briefly later on in my remarks.
In relation to the dangerous operation of vessels on our waterways, I suggest this has been a problem of serious concern to individuals throughout Canada and particularly to those resident in my area of the country, which has a very important tourist industry. For many years the waters of Canada, and particularly the inland waters, have been used for pleasure by individuals on fishing holidays, or just for travel from one place to another, as well as by those who wanted to take a vacation away from crowds of people.
With the advent of high powered engines and lighter and smaller craft, dangers on inland waters have become very great. Not so many years ago people were satisfied to have boats equipped with 2J horsepower motors, and to cruise slowly along the water enjoying themselves. Today there exist many high powered engines mounted on very light craft, which in itself creates a danger, used by individuals for travelling around our inland waters at high and very dangerous rates of speed. I do not suggest it is always young people who operate these boats in that fashion. It is very easy to blame this wild speeding on teen-agers, but I suggest that on many

occasions adults are guilty of this same dangerous practice. It seems that when an individual puts a high powered motor on a small craft he likes to feel the power behind him and takes the attitude that while travelling on open water there is not likely to be anyone else in the area.
The minister has pointed out, in introducing this bill, that there are small vessels regulations in existence under the shipping act, but that the main problem involved has been one of enforcement. Operators of these motor boats apparently have not been impressed by the existence of these regulations. While they do exist, I suggest, like the provision of library book fines, they are not taken seriously. Perhaps the reason for this is that these regulations come under the Department of Transport. I suggest that by placing these regulations under the Criminal Code it will be drawn to the attention of the public, particularly operators of these small craft, that infractions of these regulations are considered to be serious matters, to be seriously dealt with.
The Department of Transport has issued a small booklet entitled "Safety Afloat" with wide distribution among pleasure craft operators, but it has not been receiving the attention it deserves. In appendix 4 of that booklet appears a list of offences and penalties under the small vessels regulations. I feel that this has been a polite reminder to operators of small craft of the existence of the regulations. However, in view of the apparent lack of concern and attention, the time has now arrived when action must be taken in a manner which is not merely polite but also effective in preventing the continued infraction of these regulations by the operators of small boats on our public waters.
I suggest the new amendment to the Criminal Code covering the regulations in respect of the operation of small vessels will constitute a clear indication to those operators that this situation is considered serious. I believe there will be no reason, following proper publicity given to this change in the regulations, for individuals to consider them only as polite reminders.
I suggest one other problem which has resulted from the fact that the regulations were under the shipping act has involved their enforcement. There has been some difficulty in persuading municipal and provincial police forces that these regulations in respect of inland waters under the jurisdiction of the Department of Transport should be enforced by them. Those forces have taken the attitude that the enforcement of these regulations was a matter of concern

to the mounted police force only. This attitude exists particularly in the provinces of Quebec and Ontario, which are policed in the main by provincial police forces. I suggest, therefore, that there has been some gap in respect to the responsibility of enforcing these regulations on our public waters.
While it is true that the provincial police have on several occasions, certainly on the Muskoka lakes, established patrols similar to those established by the mounted police, I feel it is understandable to all hon. members that it is impossible for these patrols to enforce these regulations on all the lakes and streams throughout these districts. I suggest that the inclusion of these provisions in the Criminal Code will make clear that the responsibility for enforcing the regulations lies to a great extent upon the provincial and municipal police forces, and thereby will remove a great deal of doubt which I suggest has existed in the past in this regard.
I feel that many of these provincial and municipal forces have considered that the mounted police, particularly in Quebec and Ontario, are a specialized force designed to carry out the enforcement of federal laws, and that lack of effective enforcement of those regulations within the jurisdiction of the Department of Transport has resulted from the lack of sufficient personnel in the Royal Canadian Mounted Police force. For the reasons I have stated, I am very pleased that the Minister of Justice has seen fit to bring these regulations under the Criminal Code in respect to navigation on the waters of this country.
The second subject which I should like to deal with has reference to dangerous sexual offenders. I feel that the existence of these dangerous sexual offenders in our communities has been perhaps the greatest source of worry to parents in this country, and that the inadequacy of the law in respect to them has been obvious for quite a number of years. We all know that a royal commission was set up under the chairmanship of Chief Justice McRuer of Ontario, which reported to the Minister of Justice on March 21, 1958. That commission found that in addition to an inadequacy in law there was an inadequacy in definition as to the type of individual who ought to be dealt with as a criminal sexual offender. I suggest that the amendment now introduced by the Minister of Justice in this connection contains great advances in this matter. Occasionally it is said jokingly, if you cannot do anything about a certain subject, appoint a royal commission. But here is an example, among many others, of where a royal commission has made a very thorough review of a difficult subject and has brought forward good
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recommendations. I commend the Minister of Justice for accepting them almost without hesitation and certainly without any alteration of the main principles of the report.
In the report the commission came to a number of conclusions and made a number of recommendations with regard to sexual offenders. As found in the summary of conclusions on page 123, they conclude first that the use of the word "psychopath" as applied to the class of sexual offenders coming within the terms of reference is undesirable. During the course of the commission's hearings, many of those who appeared before it tried to define what a psychopath was and it was found that to a large extent it was undefinable. To a considerable extent the definition depended entirely on the evidence of one psychiatrist or another and, as we know, psychiatry has not developed to the point of absoluteness where there can be any sort of agreement.
I think the recommendations made by the royal commission and accepted by the minister with regard to defining the type of person and the offence constitute a much better criterion than trying to define a criminal sexual psychopath, and in that regard the first recommendation of the McRuer commission, as found on page 127 of its report, was adopted. The McRuer commission recommended the use of the words "dangerous sexual offender" and defined them in almost the precise terms that are found in the bill now before us.
The commission also recommended that section 661 of the Criminal Code should not be extended to cover any offences not named therein. An examination of the bill indicates that this recommendation has been carried out and that the same offences now listed in the Criminal Code have been carried forward into the bill.
In paragraphs 7 and 8 of the recommendations in the McRuer report there is reference to the evidence to be given at hearings and the rights of the prisoner and the crown with respect to appeals. These recommendations have been carried into the bill now before the house. The McRuer report also recommended that the courts should be given power to refer a prisoner convicted of any indictable offence for psychiatric examination before sentence. We find that this conclusion has been carried into the bill, and we also find that it applies not only to those classified as dangerous sexual offenders but to prisoners in general.
Conclusion No. 14 in the report of the McRuer commission reads as follows:
The provisions of the law requiring a court to sentence a prisoner found to come within section 661 C.C. to serve a definite term of imprisonment

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before the sentence of preventive detention commences are not consistent with the theory of the law.
Effect has also been given to this conclusion in the bill now before us, with the result that a person may now be sentenced immediately to preventive detention. I do not want to offend against the rules by the discussing the bill clause by clause, and I think it is sufficient for me to make the general comment that the good work done by the McRuer commission has been given effect in the present legislation. There are certain amendments which are not included in the report of the royal commission and there are a number of slight changes in wording, but in general the bill meets a crying need in respect to criminal sexual offenders.
There is another principle introduced in the bill that I should like to discuss. I do not think it was mentioned by previous speakers but it seems to me that it is rather important. It has to do with the power given to a court of summary conviction to remand a prisoner for mental examination. This is found in clause 42 of the bill, and I refer to that clause purely and simply because it deals with one particular principle involved in the bill.
For a good many years magistrates and persons with similar jurisdiction have been remanding for mental examination people about whom they have had some doubts. Heretofore they have had no direct and real authority to do so and no criteria to follow. Under the proposed clause they must secure the opinion of at least one duly qualified medical practitioner, and if the magistrate has reason to believe that a certain accused person may be mentally ill the magistrate now has authority to direct that the person be remanded for observation for a period not exceeding 30 days. I think this clause will be welcomed very much by a great many people involved in the administration of justice because it removes any doubt as to the period and the grounds for which such a remand can be made.
The final principle I should like to discuss has to do with the question of reinstating in the code the provision with respect to dangerous driving. Mention has already been made of this matter by the minister. While the technical reasons for omitting the dangerous driving section from the code when it was rewritten are well known to members of the legal profession, I believe the general public failed to understand the significance. Many people never did quite understand why dangerous driving was no longer an offence. Dangerous driving, of course, always has been an offence, only under a different classification and a different name.

I think the reintroduction of this particular provision in the Criminal Code will do a great deal with respect to the administration of the rules of the road. It has been found that many magistrates, judges and juries hesitate to find a person guilty of criminal negligence in connection with the operation of a motor vehicle. The criminal negligence section was not particularly designed to cover dangerous driving of a motor vehicle; nevertheless it was included as part of the general offence of criminal negligence. Now it is made very clear that dangerous driving of a motor vehicle on the highways is in itself an offence.
Those are the main principles of the bill that I wish to discuss. There are several others, minor in their nature, which can be considered when the bill reaches the committee stage. I think I might say that all these amendments are well considered and should meet with the approval of the house.
(Translation) :


Mr. J. P. Deschatelets (Maisonneuve-Rose-moni):: Mr. Speaker, the bill now before us includes 45 amendments to the Criminal Code dealing with the most varied subjects.
At the end of his statement, the minister expressed the opinion that amendments should not be made too often to the Criminal Code, so as not to cause any confusion in the field of jurisprudence, which is not always in line with the intention of the legislator. I do not know whether the minister was thinking then of the jurisprudence ensuing from the bills we passed recently on premeditated murder and goof balls, but, at all events, I have no intention of making a commotion about this matter. However, the only criticism I should like to make now is that we are being called upon to express our opinion on the principle of very important questions on too short notice, and as far as I am concerned, I was not able to examine this bill until 11 o'clock this morning. I suggest that, in the future, when a bill as important as this one is introduced, a bill which does not deal with contentious matters, it would be advantageous for members of all parties if we had at least two or three days to examine and consider it in order to properly comment on it.
I should like now to comment very briefly on some of the amendments before us. As for section 4 which makes it an offence to operate a motor vehicle in a way which endangers the public's safety, that is merely the re-enactment of a provision which existed before. The minister will recall that on March 28, 1961, the police chiefs' association sent

him a brief concerning this type of offense, in particular. I will now read that brief as it appeared in the Ottawa Citizen of March 28, 1961:
(Text):
There seems to be no alternative to a charge of criminal negligence. Hence, if a person is acquitted of criminal negligence, and records indicate acquittals far outnumber convictions, the person responsible seems to escape punishment unless one steps down to provincial or even city bylaws. This is an unsatisfactory condition.
The chiefs called for reintroduction of reckless driving.. .
(Translation):
I fully agree with what this amendment lays down. Already the Criminal Code provides very severe penalties for the most serious cases, like, for example, manslaughter due to criminal negligence on the road. I am in a position to speak knowingly on that subject because, I think it was two years ago, I acted as counsel for a man who incurred the heaviest penalty, that is five years of imprisonment, for having killed two persons with his car while intoxicated; but such cases are the odd ones.
This amendment deals with cases occurring most frequently, perhaps the most dangerous on the road, but where the driver is likely to escape scot free. It is the offence of the irresponsible driver who passes another car on a curve or on a hill, when it is impossible for him to know if a car is coming, and who thus places drivers and riders in constant danger. If I understand correctly, the amendment deals with such offences, which should be punished with the utmost severity. I hope that the legislators who will administer this act will make all the necessary arrangements to ensure, especially during the summer season, that law-abiding citizens will not be exposed to the dangerous driving of those irresponsible drivers.
I realize that it is not always easy for any provincial government to have enough officers on the road to ensure the protection and the safety of the public. But I wonder whether it would not be possible, on a holiday or on a Sunday in particular, when cars are simply crowding our highways, to assign special officers at the most dangerous spots so as to catch in the act those who commit the offence mentioned in this section.
Now, I would like to deal briefly with clause 5, in which we are asked to include in the Criminal Code certain provisions that already exist, in regulation form, in the Canada Shipping Act.
90205-6-413
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It represents another improvement. I believe that time has come to provide for and apply penalties to put an end to dangerous navigation on our waterways.
Since the end of last war, increasingly powerful craft are plying our lakes, and many tragic accidents have been caused by careless and irresponsible drivers.
At this point, I should like to point out to the minister that the proposed amendment makes no reference at all to age requirements. The minister knows, as we all know by experience, that when we have a yacht, most of the time it is the youngsters who take it over. I wonder whether it would not be advisable-and this is something we shall take up at the committee stage-to prescribe a minimum age for the operator of a craft with a motor of, say, more than 10 horsepower. In my opinion this is a most necessary provision because most of the time-as visitors to our lakes well realize-children eight, nine and 10 years old are seen operating very powerful craft, children who obviously lack the required amount of judgment to observe essential safety regulations or precautions for the proper operation of such boats.
Mr. Speaker, the minister told us this morning that enforcement of those regulations in the province where there is no provincial police, would be a responsibility of the R.C.M.P. I am referring here to the province of Quebec, and I am not talking politics at all. I say that when, in a province, there is already a provincial police force, that police force could very well-and even better than the R.C.M.P.-look after law enforcement on our lakes.
I know from experience that, on the northern lakes, where I go, the R.C.M.P. put in an appearance once or twice during the season to check on whether craft have a registration number and sometimes to investigate certain thefts of outboard motors. But, in Quebec at least, lake navigation cannot be controlled by the R.C.M.P., because there are not enough officers to see that regulations are observed as they should be.
Mr. Speaker, I hope the provincial police will see that all necessary steps are taken to ensure the implementation of this timely amendment, and that some way will be found to make it known to all our municipalities. Just how this can be done, I do not know. We are going to pass important legislation, and it meets a need. In what way will this


Mr. G. W. Baldwin (Peace River):: Mr. Speaker, first of all I wish to comment on the statement made by the minister which was referred to by the hon. member for Niagara Falls (Miss LaMarsh) when dealing with the question of when and under what circumstances there should be amendments to the Criminal Code.
I am inclined to agree with what the minister has said, provided he underlined the last part of his statement when he intimated that when there was a clear, pressing need and an indicated requirement for amendments, they would be made from time to time without having to wait for a general over-all revision of the provisions of the Criminal Code.
It has been my experience that when you have a body of jurisprudence such as is contained in the various sections of the Criminal Code, administered at varying levels from superior court judges right down to the magisterial level, it is wise not to have it in too great a state of motion and flux. There are many, many hundreds of magistrates who probably deal with by far the greatest percentage of those people charged under the Criminal Code and who have to face a magistrate, judge or judicial tribunal.
When amendments are made in parliament and they percolate down to the magisterial level we usually find some period of time has elapsed before magistrates have acquired an understanding of what is involved in the changes. It may well be that some of the changes become the subject of dispute, as for instance when a case comes before a supreme court judge and is appealed by the crown or the accused. It may even go to the Supreme Court of Canada. Amendments

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which are made today may not be solidified for a period of a year to a year and one half from now.
Consequently I think it is a great mistake to be continually stirring up the provisions of the Criminal Code, because apart from what I have said there are many consequential effects. If we make an amendment to one section of the Criminal Code today we may well find there will be a determination as to the true measure of the results of that amendment by reference to various other sections of the code and by reference to cases which have been decided in the Supreme Court of Canada or the appellate tribunals of the provinces. Sometimes the result is somewhat different from what was anticipated when the amendments left parliament.
Consequently I feel it very wise, when passing amendments in a group such as this, to find out what their impact will be, what consequential amendments may be required later on and what interpretation will be given by our courts. Then after the lapse of two or three years, or whatever the period may be, they should come back for any new amendment which may be required.
I say that I favour that approach provided, and I think the minister made this abundantly clear, we review these amendments if the situation calls for review because of the superior courts' or appellate tribunals' decisions. We should then review these particular amendments, decide that they have a certain meaning and give a certain interpretation to them, because of the great many varying situations which may arise. So long as the department and the minister are prepared to bring in amendments from year to year as and when required, I believe what the minister has announced is proper and wise, and I am saying that from very considerable experience.
I should now like to deal with the question of dangerous sexual offenders. I am not going to go into detail on this matter; it has been commented upon by all speakers so far, and I will have something to say when we are considering this matter in committee. I mention specifically only one aspect of it, and that is with approval. I refer to the effect of the measure which permits there to be some type of treatment without the necessity of there being a determinate jail sentence. I think that is requisite; I think that is very, very necessary. I should only like to make this general observation that this particular aspect of the amendments is a measure of the willingness of this government, and in particular of the Minister of Justice (Mr. Fulton) who is charged with the responsibility in these matters, to deal with this question and with kindred problems on a far wider basis than

has been the case in the past, and I am not saying this in any partisan spirit. There is a tremendous wastage in our society today because in the past we have not been prepared to consider ways and means of salvaging persons in this country who have committed criminal offences, and who have done things for which there must be some punishment, but who may still be restored to society. So many of the matters which the government has undertaken, and so many of the bills which have been passed, have indicated that this government is prepared to examine our criminal law in the light of its social implications. While on the one hand preserving penalties which will act as a deterrent, society still holds out a hope of the individual ultimately regaining his place. Those who deliberately choose and persist in criminal courses of action will receive stern punishment but, on the other hand, those who through no fault of their own have fallen into or been driven into a course of action which involves them in the criminal law are to be helped in every way we can. It is not only the pragmatic cost in dollars and cents, if you want to look at it that way, but the fact that these people have a place in society and it is for us to make sure that we restore them to it if possible.
I want to deal to some extent with the amendment which restores to the Criminal Code the section providing for the offence of dangerous driving. I am interested in this matter. I mentioned it on the estimates of the minister and I was very glad to hear at that time that an amendment of this kind was to be included in the amendments to the Criminal Code when they were brought down. At the present time there is in the code the offence of criminal negligence which, when it results in the death of a human being can be punished by life imprisonment. When it results in bodily harm to an individual it can lead to a penalty of up to 10 years, and when committed without any specific harm being done to an individual, an offender is still liable to a penalty of five years. The general description of that offence is "wanton and wilful disregard". It has been my experience, and I am reinforced in it by opinions which have been expressed to me unofficially by members of the judiciary and by crown attorneys who have appeared in these cases that when a judge has to charge a jury giving them direction as to what the law is in respect of criminal negligence and has to explain these words "wanton and wilful disregard" he often runs into difficulty. This situation is made worse when, quite often, a jury, though it is not concerned with the question of the penalty, realizes what the penalty is. Many instances have occurred

when people who should have been convicted in respect to some offence have been acquitted.
Under the old code, under the code as it stood before the introduction of the offence of criminal negligence, there was what is known as reckless driving, as the minister has pointed out, and dangerous driving. Reckless driving can be more or less related to criminal negligence as it now exists. Consequently I think the minister is right in saying it is unnecessary to bring that back into the code. But the reintroduction of this offence and the fact that when there has been a conviction the judge is entitled to prohibit the driver from driving for a specified period of time is an excellent change in the law as it has heretofore existed. The fact that there has been a consequential amendment by which people who are charged with the more serious offence may still be convicted, if the jury sees fit, on the lesser offence of dangerous driving is also to the good. The frightening carnage and slaughter which is taking place on highways of this country- a slaughter which I greatly fear will increase as our population grows and as more cars come upon the highway-will grow no less as more and better roads are built. It is erroneous to think that when we build better roads we shall experience less killings, less motor car accidents, less injuries. I do not think this is the case. Anything we can do to try to stop this and get at the root cause of it is all to the good. That is why I am most heartily in favour of this particular amendment.
I might mention to the hon. member for Maisonneuve-Rosemont (Mr. Deschatelets) who brought up what appears to be an excellent suggestion concerning an age limit that this question might well be considered by the provincial authorities. The hon. member was talking about the operation of vessels.
I want to pass on, then, to this particular part of the amendment which introduces into the Criminal Code the various provisions which in the past have been contained in Department of Transport regulations for safety. Apart from the fact that there is involved a question of policing I think it is all to the good that we are now attaching a stigma to these particular actions. In the past it might well be that people regarded them as being a breach of a regulation. Once these regulations become part of the Criminal Code there is likely to be present in the minds of people a consciousness that in committing any of these prohibited acts they are in breach of the criminal law of this country, and it has always been my feeling that when we introduce a provision into the Criminal Code and say it is prohibited and there is a penalty
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for it, reasonable, decent, law abiding people are more likely to consider their actions with care in the future than in the past. For this reason, I feel that the enactment of these particular provisions as part of the Criminal Code will go a long way to ease the situation now existing. And the present situation does present a danger. The hon. member for Parry Sound-Muskoka (Mr. Aiken) enlarged upon it. Anybody who has been down to the summer resorts, the lakes, the rivers and the seaside of this country in the last few years cannot but be impressed by the large increase in the number of pleasure boats in use. That is part of the heritage of recreation enjoyed by the people of this country. But this is a right which must be used hand in hand with the responsibility which goes with operating vessels of this kind. The waters of this country are for the benefit of all the people. They are not merely for those engaged in operating speed or pleasure boats. I hope the incorporation into the Criminal Code of offences which heretofore were part of the regulations published by the ministry of transport under the small vessels act will go a long way toward dealing with this problem.
The only other point I should like to deal with which has not been mentioned as yet, is that section of the bill dealing with the offence of false pretences. I suggest this proposed legislation enlarges the coverage in respect to banks so as to include other financial institutions and will, I imagine, include credit unions and, in the province of Alberta, the treasury branches which operate there, and will attach to the deliberate writing of cheques on accounts which, known to the writer, do not contain sufficient funds, the same criminal consequences as are now attached to those individuals who write cheques on chartered banks.
I approve of the principles of this legislation as well and feel that when these matters are being dealt with at the committee stage there will be greater opportunity to go into the detail of the principles which have been brought forward.


Herbert Wilfred Herridge: Mr. Speaker, I intend to be brief because I am not competent to deal with some aspects of this bill. However, I do intend to comment with regard to the two or three sections in which I am particularly interested and with which I feel competent to deal.
I listened to the minister, while enjoying my pipe behind the curtain, with a good deal of interest during his introductory remarks. I noted that he said in his opinion it was not wise to frequently amend the Criminal Code. I think he suggested it should not be amended more frequently than once

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every two years. I feel that is a very sound practice. I feel that the application of law to any degree must be accompanied by time and experience in order to make certain in the first instance that a particular law is not as effective as it should be, and to acquire that experience which indicates the amendments required. I am an individual who is opposed to tinkering with things in too much of a hurry. I am a little old fashioned in that respect. In fact, I have a model T car which is quite serviceable and is much better than many modern vehicles for operation on backwoods roads. I mention that fact to indicate that I do not change my opinions overnight.
I intend to say a few words in regard to clause 5 of this bill dealing with small vessels, which provides for the incorporation in the Criminal Code of the regulations, which previously existed under the jurisdiction of the Department of Transport and were enforced by the Royal Canadian Mounted Police. I think this is a sound move because the field of small vessels navigation is becoming increasingly important. I do not intend to criticize anyone who in past years considered that these regulations were sufficient because the problem in regard to the operation of small vessels has developed very rapidly since the end of the second world war, as a result of a tremendous increase in ownership of small craft for recreational purposes. As I understand the principles of this clause, the administration will be in the hands of provincial authorities, even though the provinces have a contract with the Royal Canadian Mounted Police.
I have noticed a great increase in the numbers and uses of these small craft on the lakes of the area in which I live. I have been very conscious in recent years of the increase of the horsepower of the engines being used, as well as the increase in interest in water skiing and things of that sort, and I have, therefore, noted the increased necessity for sufficient regulations and laws to deal with the situation.
Without regulations and laws of this kind there will always exist a number of individuals who fail to use good judgment in respect to their own safety, and who have very little regard or concern in some cases for the safety of others, often as a result of ignorance. Many individuals in the last two years have taken to water sports and water recreations with very little experience and knowledge of how very quickly serious accidents can occur through the use of fast moving craft.
As far as the administration of the regulations is concerned one of the big problems will involve personnel. I suggest in isolated

areas, where many people go to enjoy water recreations, it will not be possible to have constables to enforce the regulations. I do not understand how this difficulty will be overcome but I suggest that with the cooperation of launch clubs and recreational organizations it may be possible for provincial authorities to establish services similar to the honorary fire services, members of which, because of their knowledge, and by recommendation of responsible groups, can be issued badges indicating the right to counsel and advise operators of small vessels in the first instance and to turn over to the proper authorities for prosecution the numbers of the craft of individuals who refuse to obey the law. I suggest the success of the application of this law will depend entirely upon co-operation between organizations interested in these types of sports and activities, as well as upon the co-operation of the greater percentage of individuals involved in this type of activity.
In addition to the adoption of these regulations I am of the opinion that small water craft should be licensed. I believe the time has arrived when the owners of small craft should be required to license their vessels at a fee of between $1 and $3, following their having passed rudimentary examinations regarding the principles of navigation and rules of the road, so to speak, as well as an examination in regard to safety requirements, involving the use of life preservers, fire protection equipment, engine control, and things of that sort. I do not know whether this type of regulation would come under the jurisdiction of the federal or provincial government, but I suggest it is something that must be worked out in the very near future through co-operation of the federal Department of Transport and the appropriate provincial authorities.
I make these suggestions, Mr. Speaker, because I am firmly convinced that we have now arrived at the time when operators of small water craft of over three horsepower should be licensed. I think this suggestion will be accepted by the majority of those operators, because it is not the majority who object to regulations and licensing but, like the operators of motor vehicles on the highway, the small percentage of irresponsible individuals who will not be checked or changed except through regulation and licensing.
Mr. Speaker, I should also like to make a few remarks in respect of clause 9 of this bill. Having listened to the remarks of the Minister of Justice (Mr. Fulton), the hon. member for Niagara Falls (Miss LaMarsh) and the other hon. members of the legal profession who spoke in regard to this bill,

I feel a bit like a duck out of water in doing so. However, clause 9 in part, reads as follows:
(1)	Everyone who. with intent to injure or alarm any person, conveys or causes or procures to he conveyed by letter, telegram, telephone, cable, radio, or otherwise, information that he knows is false is guilty of an indictable offence and is liable to imprisonment for two years.
(2)	Everyone who, with intent to alarm or annoy any person, makes any indecent telephone call to such person is guilty of an offence punishable on summary conviction.
(3)	Everyone who commits an offence under paragraph (b) or (c) of subsection (1) is guilty of (a) an indictable offence and is liable for imprisonment for two years or (b) an offence punishable on summary conviction.
Paragraph (b) and paragraph (c) of subsection (1) read as follows:
(b)	to burn, destroy or damage real or personal property, or
(c)	to kill, main, wound, poison or injure an animal or bird that is the property of any person.
I should like to comment in regard to paragraph (2) of that clause. I can well understand the necessity for the regulations and have known of one or two cases where, in order to annoy, or alarm or cause anxiety to a person, particularly a woman whose husband is away, an individual has telephoned possibly three times per day, week after week, and has simply failed to say anything when the telephone was answered. I have been informed of one case where this has caused serious anxiety and almost a nervous break down. When we come to the clause itself, I wish the minister would inform the house if it covers such a practice where a person simply telephones a number repeatedly night after night and when the phone is answered never speaks. These people do this in order to cause a state of anxiety and annoyance. If it is not covered by the clause, I think it should be because in some instances it is getting to be quite a common trick. It does not sound like much when one mentions it in discussing a clause in a bill but the practice can cause very serious anxiety to some people.


Mr. Macdonnell:: Do you mean to say that sane people do that?


Herbert Wilfred Herridge: I would not think they were sane, Mr. Speaker, but they are vindictive people or people who want to cause annoyance. We have a small percentage of these cranks, shall I say. It might be done because of certain circumstances, because a person belongs to a certain group or something of that sort, but it does happen.
I come now to clause 11 which I find rather interesting. It is amazing, Mr. Speaker, but even a socialist is attracted to a clause in a bill if it has something to do with his personal experience and if that personal
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experience has cost him some money in the past. We cannot help it. We are all weak and human. The explanatory note in connection with clause 11 reads as follows:
The purpose of this amendment is to make it lawful for a land surveyor, surveying for a public work which will necessarily obliterate an existing boundary mark, to remove such boundary mark provided he establishes a permanent record that permits its original location to be ascertained.
I have known of a number of persons, Mr. Speaker, who suffered considerable inconvenience in recent years because of the removal of a boundary mark or survey stake, particularly with respect to property, timber limits and things of that sort. Mind you, there is an increasing lack of respect for boundary marks. I think some people do not realize what they are, but this situation has been brought about because of the development of highways and public utilities. I have found that the very competent engineers in charge of the building of pipe lines, for example, especially if they come from Texas, have very little regard for these stakes. They simply bring in their bulldozers and push them over.
I think more must be done with regard to this matter. I am not really sure what the offence is but I think it should be considered a serious offence to remove a boundary mark or survey stake. I am not sure what the penalty is either but I wish the minister would inform the house as to the situation when he speaks. I have known of a number of cases in the last four or five years where great inconvenience and considerable expense have been occasioned by people simply pulling up a survey stake at the corner of a timber limit or timber lease and throwing it 10, 15 or even 100 feet into the woods thinking that it is just a joke. This is something that has come about with the increasing population. There are many people who did not grow up under the same environment as we did and they do not realize how much it actually cost to put the stake there.
I am speaking to some extent from personal experience and therefore I speak with some warmth and interest. In the first place, I think this is a very serious offence and attention should be drawn to it even if notices have to be posted for the information particularly of the younger people who are quite unaware of what they are doing. They think these stakes are simply driven in at appropriate intervals and can easily be put back in place. They do not realize that it may require the running of four or five miles of line to locate the stake again.
It is explained here that the purpose of this amendment is to make it lawful for a land surveyor, surveying for a public work which will necessarily obliterate an existing boundary mark, to remove such boundary mark

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provided he establishes a permanent record that permits its original location to be ascertained. I have seen that sort of thing done in the past and I am not sure whether it is sufficient. I think it should be a last resort. I think that anyone who removes a stake or boundary mark should first be required, if at all possible, to provide an offset mark. What I mean by that is that if you put blazes on three trees and triangulate from the three trees you can find the location of the stake even if it has burned down. In the majority of cases you can locate the boundary mark or offset stake or offset monument, whether the distance is 10 feet or 50 feet or 100 feet. That is a much less expensive way of determining the corner or boundary of any property than depending on a record which will cause you to hire a surveyor at considerable expense who, in order to locate that position, may have to run a line two or three miles long. I am speaking of large land holdings, timber holdings and things of that sort.
I ask the minister to consider whether it is not possible first of all to provide for an offset boundary mark in order to lessen the expense rather than having to determine the location of the boundary mark or stake from a record. I have no doubt that the minister has received advice on this matter but I just mention these things as a result of my experience. When we come to this clause I should like him to tell me whether there is any merit in the suggestion or what reasons he has for refusing it.
When it comes to the question of what is a permanent mark, that is a very relative term. In surveying history a four-inch by four-foot stake was a permanent mark according to the legislature of British Columbia. Under modern conditions a wooden stake is no longer a permanent mark and I think there should be some elaboration of the word "permanent" to indicate that it means either an iron stake or a cement block or something else that is definitely permanent and cannot be easily wrenched out or destroyed by fire or because of other circumstances.
These are the clauses in which I am partic-ularily interested, Mr. Speaker, though I am interested in all these amendments. I am very pleased to see the amendment with respect to dangerous driving. I listened with great interest to the minister's explanation of the amendments concerning sexual offenders. I am going to say very little on that subject because I am not competent to deal with the legal, medical and psychological aspects of such a very complicated problem. I judge from the minister's remarks that this is a progressive step and an improvement

over the former legislation. I know the matter has received considerable study and is of great importance.
Finally, with respect to this serious problem which requires our sympathetic attention, I wish to say that I am all in favour of this new and more sympathetic approach. While we have to protect citizens and restrict and punish those who are criminals in this respect, we also realize there are many persons who are actually psychologically sick and who suffer as a result of their inherited tendencies or unfortunate environment. This group is very pleased to see these amendments and we will watch the results with interest. Those members in particular who have taken an interest in this subject for many years will watch with interest the application of this new law respecting sexual offenders. No doubt as a result of time and experience amendments will be found necessary to improve the legislation further, but from our point of view this is a step in the right direction.


Mr. W. B. Nesbitt (Parliamentary Secretary to the Secretary of State for External Affairs):: Mr. Speaker, I should like to commend the Minister of Justice (Mr. Fulton) for the amendments to the Criminal Code which he has introduced. In my opinion all of them have been needed for some time but, as the hon. member for Kootenay West (Mr. Herridge) has said, it is not wise to tinker with these things until proper consideration has been given. While I should like to speak on a number of the amendments, I think I will confine my remarks at this time to those involving the regulation of small vessels. This, Mr. Speaker, has been a matter of great interest to me ever since I have been in this house. The history of this legislation is probably interesting, too. In 1954 I had the honour of introducing a resolution concerning the establishment of a search and rescue organization on the inland waters of Canada. This resolution was debated on several occasions and received the support of all hon. members who spoke. Naturally, the discussion of this resolution covered a rather wide area and included, among other things, the regulation of small vessels on inland waters.
Subsequently, amendments were made to the Canada Shipping Act to regulate small vessels. I can well recall that many hon. members in this house now, as well as others who were members at that time, contributed many valuable suggestions to the committee which was set up in 1955 and 1956. As one or two hon. members have pointed out today, while regulations were passed under the appropriate section of the Canada Shipping Act, there has been some confusion in various

parts of the country as to how these regulations should be enforced. In Ontario, for example, the provincial police were not certain as to whether they should enforce them or whether the Royal Canadian Mounted Police should enforce them, since the regulations were made under a federal statute. Certainly in so far as the public is concerned, the regulations under the Canada Shipping Act relating to small vessels have not been very adequately enforced. I think all hon. members would agree with this.
While the enforcement of the law is of course not the responsibility of this parliament, nevertheless now that these regulations are embodied in the Criminal Code it will be made quite clear that the provincial authorities should enforce these regulations the same as other sections of the code. The hon. member for Kootenay West made a suggestion with regard to enforcement. He said that yacht clubs and organizations of that nature might very well appoint special deputies to help enforce these regulations during the summer months. I would agree with this suggestion. However, I should like to go a step further. Since the use of small craft is, of course, prevalent in the summer months, those who are charged with responsibility for enforcing these regulations might very well give consideration to the employment of senior university students. This scheme would provide the students with summer employment, with the necessary funds to continue their education, and at the same time would not cause the law enforcement authorities to take on an unnecessary number of persons whose services would not be required during the balance of the year. As I have already mentioned, services of this nature would be required largely during the summer months. I know that the Department of National Revenue employs senior university students to assist in the enforcement of customs regulations during the summer. I feel that the provincial authorities who will be responsible for enforcing these regulations might very well deputize a number of senior university students to help enforce the regulations covering small craft on the great lakes, Muskoka lakes and other resort areas in Ontario as well as other parts of Canada.
There is another matter to which reference has been made by the hon. member for Maisonneuve-Rosemont (Mr. Deschatelets) as well as the hon. member for Kootenay West, and that is the question of licensing small craft and the age limits of operators. I realize that there may be some difficulty in setting age restrictions. Also, I do not know whether or not this parliament has the constitutional authority to license boats. This is a subject for constitutional lawyers, and I 90205-6-414
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would not presume to make a statement upon it. I would be interested in hearing what the Minister of Justice might have to say on the matter. If it is not possible for this parliament to legislate on the matter, perhaps the appropriate legislative bodies could do so.
I refer, of course, to the question of licensing not only small craft, which I believe are licensed now, but licensing the people who operate them. I am not particularly concerned whether a one dollar or two dollar fee is charged, as suggested; I do not believe that is important. The important thing is to make certain that the people who operate small craft which have engines of high horsepower are persons who are responsible. In so far as the age limit is concerned, I do not know what it should be. I feel this should be given careful consideration. Perhaps sixteen would be the appropriate age, just as it is for driving a car. One thing is quite certain. Since the war there has been a great increase in the number of small pleasure craft using our inland waters. I believe it is just as essential to regulate craft using these waters as it is to regulate traffic on the highways. I believe that is a selfevident fact upon which I do not have to elaborate.
Some consideration should be given, too, to requiring persons to be a certain age before they are permitted to operate boats which are propelled by engines of perhaps more than three horsepower. These boats can become very dangerous weapons indeed in the hands of irresponsible persons. Provision is made, I see, for adults, for those who are intoxicated while operating boats. I have spent a great deal of time on the inland waters during the summer because boating happens to be a hobby of mine. Generally, the worst offenders in the operation of small boats are young boys and girls of 10, 12 or 13 years of age. It is true there is the occasional adult offender. However, all too frequently we see children of eight or ten years of age operating boats powered by engines of 40 horsepower. They go roaring around small lakes, in around swimmers, in a very dangerous manner. I do not believe there is any excuse for the parents who permit this to happen. I believe an age limit might be set which would prohibit children operating a boat over a certain horsepower.
It is very difficult, of course, to make children reponsible and punish them because they are not really responsible. I believe provision might be made for the punishment in some way of the parents who permit children to operate small boats of high horsepower. This matter should be given consideration. I do not expect the minister to immediately produce an additional amendment to the act because, as the hon. member for Kootenay

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West pointed out, you do not want to tinker with the Criminal Code unless adequate consideration has been given to the amendments. I think this is something the officials of the minister and of the Department of Transport might carefully consider because I believe such provisions would go a long way toward preventing unpleasant accidents. I believe those are all the observations I have to make at this time.


James MacKerras Macdonnell: should like to ask a question, Mr. Speaker. What is the meaning of the words "dangerous to navigation" contained in section 226A (1)? What kind of navigation is included? I understand the reference to be wholly to power boats, those little boats that rush about as the hon. member for Oxford (Mr. Nesbitt) has said at 30 to 40 miles an hour and make life hideous for everybody within range. Is any consideration being given to the comfort and security of those strange people who still row or paddle or sail or are they regarded as being just as extinct as the dodo? Are they no longer to have any rights? Are we quite prepared to accept the fact that those sports have now given way to the so-called sport of sitting in a boat and being rushed about by an engine? That is my question. In the consideration of the words "dangerous to navigation", can the navigation of these innocent people be considered, because it certainly is no joke to suggest that it is dangerous for them to be on their lawful occasions when these incredibly powerful little boats with irresponsible people in them are dashing about.
(Translation):


Mr. Gabriel Roberge (Meganlic):: Mr. Speaker, I should like to take this opportunity to deal with the principle of this bill and to congratulate most heartily my colleague from Niagara Falls (Miss LaMarsh) who replied to the Minister of Justice (Mr. Fulton) this morning, even though she hardly had any time to prepare herself.
I should like to offer similar congratulations to my colleague from Maisonneuve-Rose-mont (Mr. Deschatelets) who, in spite of the few hours at his disposal, succeeded in giving us this afternoon a most accurate statement on the bill under consideration.
Since I have been sitting in this house, Mr. Speaker, I have taken part in several debates on bills introduced by the Minister of Justice. I had the opportunity also of participating in the debate which takes place each time we consider the estimates of the Department of Justice, the penitentiaries division and the R.C.M.P.
Very seldom did I have to address any reproach to the Minister of Justice but this time, I have a few to make. Perhaps those reproaches do not concern him in particular but they surely concern the government of which he is a member, and especially the leader of the house.
During his speech this morning the Minister of Justice told us that, in his opinion, a government should not introduce amendments to the Criminal Code every year but rather think them out thoroughly and submit them to the house deliberately, after having considered all the aspects of one or several matters covered by the Criminal Code.
Mr. Speaker, I agree in part with the principle that legislation, and especially the Criminal Code, should not be amended without due consideration. On the other hand, the government, clearly disregarding this principle, introduces through the agency of the Minister of Justice a bill including 46 sections. This bill was read for the first time Saturday morning, and it is only this morning, at the beginning of the sitting, that a copy of the bill was made available to us. And moreover, Mr. Speaker, the standing orders of this house provide that any bill must be printed both in French and in English.
Now, when this morning's order paper was distributed, the French version of the bill was not ready. In fact, when we came to the house at 11 o'clock this morning, only the English version was available, and we had to send over for the French version.
It is extremely important for hon. members, particularly the French speaking members, to prepare themselves adequately for a debate. It would have been preferable to be able to examine the French text at the outset. We did not even have a single week end to consider this bill, and you will agree that this is inadequate.
This is what I would call an omnibus bill, as the amendments put forward deal with various aspects of the Criminal Code.
I have no doubt that these amendments have been the subject of continuing and thorough studies by the minister and his officials. Some time was also devoted to them by various organizations. I refer in particular to the Canadian association of police chiefs, which made recommendations in a brief submitted to the minister last March.
The proposed amendments to the Criminal Code deal with the dangerous driving of motor vehicles, threats made by telephone or otherwise, etc.
fMr. Nesbitt.]

The McRuer commission, appointed in 1954 by the former government, pursued its studies until 1958, when it submitted its report.
It recommended various amendments to the Criminal Code, particularly in relation to habitual criminals and habitual sexual offenders.
We agree with the minister that all amendments proposed in his bill represent a step in the right direction. As far as I am concerned, I foresee no difficulty in getting this bill adopted.
I should like, Mr. Speaker, before resuming my seat, to deal with a few points covering dangerous sexual offenders.
They are divided into two categories.
First of all there are the sexual perverts, the depraved individuals, who are caught in the swamp of sexual delinquency. We all admit with the minister that they have to be kept away from society.
On the other hand, there are sick people, those who suffer from an anomalous state for which they are not actually responsible.
Those people are not necessarily criminals. But, in their case, the state has the responsibility to provide a temporary internment which would help their rehabilitation.
Some time ago rehabilitation was discussed in this house, particularly when the estimates of the penitentiaries branch were discussed.
Last Monday, more particularly, when we examined the penitentiaries bill, the question was studied at length. Habitual criminals, ordinary habitual criminals, which this legislation covers, and dangerous sexual offenders were all discussed.
Clause 39 of this bill says that the minister shall, at least once a year, submit all cases of criminals undergoing preventive detention to a review by the parole board.
To my mind this is an improvement. The Criminal Code now provides for a revision every three years, but this bill provides a yearly revision of the records of those unfortunate people.
With regard to the rehabilitation angle, the minister mentioned it when the situation of penitentiaries was discussed.
I believe that, in a general way, this section, if it is enacted as we may expect, will mean a substantial improvement and a better protection of society against those who live in ordinary crime or sexual crime.
(Text):


Mr. Laurier Regnier (St. Boniface):: Mr. Speaker, I wish to deal briefly with section
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660 dealing with applications for the imposition of preventive detention. Section 660 reads as follows:
Where an accused has been convicted-
Section 661 contains the same words. Section 661 deals with cases of rape, carnal knowledge, indecent assault on female, buggery or bestiality, indecent assault on male and gross indecency. These are cases which are usually heard by juries. One of the sections provides that the application for the imposition of preventive detention shall not be heard by a jury. Then section 662 provides:
(a) an application under subsection (1) of section 660 shall not be heard unless. ..
(ii) seven clear days' notice has been given to the accused by the prosecutor, either before or after conviction or sentence-
Therefore I am a bit puzzled whether the application can be heard concurrently with the offence being tried, because in most instances the offence would be tried by a jury. It is provided that notice may be served even before conviction, although sections 660 and 661 provide that application may be made only after an accused has been convicted. I submit that this bill requires amendment to reconcile those two sections.
Another section provides that if the application is made after conviction it shall not be heard by the convicting judge. That would imply that a transcription of the evidence would be required for the hearing of the application. Past experience has shown that many times an accused has not been able to properly defend himself because he did not have the funds or opportunity to obtain for himself a transcription of the evidence.
Then section 667 deals with the right of appeal to the court of appeal. Here again 1 should like to underline the fact that an accused has to face an almost indefinite sentence of imprisonment, if he is convicted and sentenced to preventive detention, and he may not have the funds with which to provide the transcription of evidence.
We know that cases are dismissed every year in the court of appeal where the accused has filed notice of appeal but has not the means to provide a transcription of the evidence for all the judges of the court of appeal, for the crown and himself. I believe accused persons deserve some protection in this regard, because it means that wealth and poverty are not balanced. Many times an accused has not sufficient funds of his own with which to provide the required number of transcriptions, and very often he has not any friends who can provide these funds. I commend the minister for this bill, but it seems to me more safeguards should be provided for accused persons.

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Mr. R. D. C. Stewart (Charlotte):: Mr. Speaker, in rising to speak on Bill No. C-110 at the present time I do not wish to delay the bill being considered in committee. Although there is no general principle involved in this mil, it contains a number of substantial amendments to various sections of the Criminal Code.
I listened with a great deal of interest this morning to the Minister of Justice (Mr. Fulton) as he outlined the provisions of this bill, particularly those sections dealing with dangerous sexual offenders. I believe that in this particular field the provisions of our Criminal Code at the present time are wholly inadequate. It is not enough to remove these people from society; we must, if we are going to practice the principles of Christianity, try to provide some means of rehabilitating them.
I also agree with the minister that amendments to the Criminal Code should not be made piecemeal, they should not be made haphazardly or too often unless it is absolutely necessary. It has been found in the past that one amendment to the Criminal Code usually requires several other amendments to various other sections. If those amendments are not made at the time the result is that the new amendments, if enforced by the courts without the corresponding sections being amended-perhaps this is a good thing for defence counsel-possibly a person who should have been convicted escapes punishment.
There are a number of substantial amendments in this bill. As the bill will be discussed section by section in committee I do not intend to refer to these sections specifically, except to say I am quite disturbed about introducing into the Criminal Code regulations dealing with the operation of small vessels.
As I read the relevant section, it puts small vessels in exactly the same position as motor vehicles on our highways. In the constituency of Charlotte we are not particularly concerned with pleasure craft except in some of the inland waters. As this house is aware, we have tides of 28 feet and 29 feet in the bay of Fundy which prevent the use of that water by pleasure craft.
Also, most of the vessels in the bay of Fundy area are commercial vessels used entirely for fishing purposes, having a speed of possibly six or seven knots per hour, and some of them a great deal less. Most of these boats are powered by inboard motors, except the small boats used by fishermen for lobster fishing, which are sometimes powered by small outboard motors. These boats do not constitute any menace, or any of the dangers that this provision of the code contemplates
[Mr. Regnier.l
and I would suggest to the minister that possibly there should be some distinction made between commercial craft and pleasure craft.
I have another observation to make. During the past number of years, particularly since the present code was revised in 1955, there has been a tendency to take away from an accused person the right to a trial by jury. I realize there was a reason for this. It has prevented a lot of minor cases from going up before the supreme court or before a county court and a jury. Nevertheless, we should keep in mind that when we are going to impose a severe penalty on a person charged with a criminal offence we must give him an ample opportunity so that he may have a proper defence at the right time. We have, in other words, extended the powers of magistrates without, in a good many instances, increasing their competence. I realize that the appointment of magistrates is purely a matter for provincial governments, but we have an instance in this bill where we are going to make driving by a motor or a boat operator whose licence is under suspension an indictable offence carrying with it a possible penalty of two years' imprisonment, yet we are making it one of the offences which can be tried by a magistrate with absolute jurisdiction. In other words, although the magistrate now, under the summary conviction penalty section, can sentence a man on conviction to a maximum of $500 and six months, or a fine or sentence less than the maximum it is now going to be made an indictable offence when a man is liable for two years imprisonment, yet an accused has no option but to be tried by the magistrate. Under the absolute jurisdiction section of the code we find that the offences dealt with in this way are more or less minor offences such as assault, assault on officers or peace officers, attempted theft, thefts involving sums less than $50 and so on, most of which are dealt with by magistrates by the imposition of fines or short jail sentences of maybe up to 30 days. If the circumstances surrounding the suspension of a licence in the operation of a car or a boat after suspension were serious enough, I suggest an offender could be tried under the criminal negligence section of the code.
I was interested in the minister's observations on the old dangerous driving section of the Criminal Code which, if my memory serves me correctly, was section 285(6). The minister explained why this section was deleted, but I would suggest that the main reason was the difficulty of obtaining convictions under the old code which set out three distinct and separate offences. I am pleased to see that the change now proposed

in this bill deletes many of the objectionable features of the old section 285(6). But I think this further question should be raised: are we not getting into another field of conflict, as most of the provinces have passed legislation dealing with the operation of motor vehicles? These are usually called "due care" sections. I just point this out to the minister to indicate that there is some difficulty inherent in this section.
I do not intend to discuss at any great length habitual criminals or dangerous sexual offenders. I suggest, however, that in both categories the federal government should provide some means of rehabilitating individuals of this type, providng ways and means whereby they can obtain the necessary training. It has been my experience over the years to defend a good many of these people and I say they are more to be pitied than punished. I feel we are failing in our duty if we do not provide not only for their removal from society but some method whereby worthy citizens can be made of them.
I shall have some further observations to make when the bill is before the committee and is being discussed clause by clause. I feel I should commend the minister and his department for the substantial and beneficial amendments proposed in this bill.
(Translation):


Mr. Remi Paul (Berlhier-Maskinonge-Delanaudiere):: Mr. Speaker, in any properly organized society, criminal law must be conceived so as to protect the citizens, and any legislation must always be drafted in the light of common good.
If we consider the bill now before us, we are convinced once again that the Minister of Justice (Mr. Fulton) has taken into account various recommendations submitted to him by different organizations.
This bill, on the whole, features three aspects of safety. First, there is the section dealing with highway safety; the second section provides for water or maritime safety; and third, a series of sections provide for moral or social safety.
Considering the dangers incidental to driving nowadays on our increasingly congested highways, I feel we must take stricter steps to bring to reason those who drive their vehicle without paying any heed to the rights of those they meet on the highways. In view of the large number of accidents, the legislators must punish those who break our laws because, by their reckless and dangerous driving, they ruin the social order in families.
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Besides, I believe we are right in being even stricter with those who, because of carelessness, youth, stupidity or intoxication constitute real hazards to public safety.
The minister has decided to include in this legislation the provisions of the Canada Shipping Act with which the people were not familiar enough and which were not respected unfortunately. There again, there are too many water casulties today and society which we represent, must take every possible means to put an end to this lack of care which people show much too often on our lakes and rivers during the summer season. Turning offences under the Shipping Act into indictable offences appears to me to be a wise measure in so far as it will prompt owners of commercial and pleasure crafts to observe basic safety rules.
I think we must pass such a measure in order to provide the ever increasing number of people who are to be found on our beaches, rivers and lakes with a minimum of safety and to protect them from the fools who, careless of what is going on around them, are a real threat to the public.
The principal feature of Bill No. C-110 is the provision dealing with dangerous sexual offenders. It seems that the bill wants these offenders against marality to be treated more like sick persons.
The legislation aims at protecting youth against these mentally unbalanced and dangerous beings; that is why the minister inserted into the bill these provisions the effects of which will be to protect society from these dangerous persons.
The hon. member for St. Boniface (Mr. Regnier) seemed to view the problem from a different angle. In his opinion, offences mentioned in sections 136, 138, 141, 147 and 148 of the Criminal Code are still crimes for a jury to judge. And when the hon. member said that the application cannot be heard by a jury, he was referring to a distinction bearing not on the crime itself, but on the consequences that the individual might bring upon himself in committing his crime, because the attorney general must decide on the application of this act and he may order an inquiry before a judge to determine whether the accused is a dangerous sexual offender. It is only in that case that the hearing is not before a jury. In my opinion, the person who has to face a specific charge against morality retains all his means of defence, as it is the case now under our Criminal Code as modified in 1955.

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All members will readily accept those different amendments which not only help improve our Criminal Code but ensure a larger measure of protection for society through fuller respect for the individual and the right to human life.
(Text):


Mr. H. Russell MacEwan (Pictou):: Mr. Speaker, I have listened with interest to the remarks of hon. members who have spoken this afternoon in regard to Bill No. C-110 as introduced this morning by the Minister of Justice (Mr. Fulton). I listened with particular interest to the remarks of the minister, and the hon. member for Peace River (Mr. Baldwin), my neighbour on the other side of the house, whose words are usually wise and worthy of attention. I thought this was particularly true when he referred to the matter of amendments to the Criminal Code, that very important piece of legislation in this country which applies throughout the many provinces, and involves all the people of Canada.
The hon. member for Peace River pointed out that certain amendments must be made to the Criminal Code from time to time because of the fact that our way of life changes, as well as because of changes in our society. He suggested that the amendments to our legislation must reflect these changes but that they should not be made too quickly or too often, because they must be interpreted throughout this land by the members of the judiciary who are, after all, human also, as well as by lawyers engaged both in crown and defence work. Time must be given, as that hon. member pointed out, for interpretation of the changes, and for cases to be tried in the various courts of the land, so that a complete picture can be obtained as to the impact upon our society. We must not be stagnant in regard to our legislation, but must at the same time allow for a period of interpretation.
I should like to make a few remarks regarding the amendment contained in this bill particularly concerning the operation of small boats. I feel it has particular importance to the Atlantic provinces, and recognize the situation referred to by the hon. member for Charlotte (Mr. Stewart), and the importance of this legislation to the people of his area where there exists a particular problem because of the fact that small boats are engaged to a great extent in commercial enterprises. However, I suggest that small boats are used a great deal today in many other areas in the Atlantic provinces, as well as in the areas of inland water in Canada.

I feel that the results of these regulations, formerly contained under the shipping act, will justify their incorporation in the Criminal Code.
I think that the benefits of this change will be recognized by the many individuals throughout Canada who operate small boats strictly for enjoyment and in the pursuit of hobbies, as well as by those individuals who are members of yacht clubs and other similar organizations. I am sure those individuals will also realize the necessity of having regulations of this type. I do not suggest that they should be too strict, but I believe that responsible individuals will recognize the necessity for regulations in respect of this type of operation as responsible car drivers throughout this country recognize the need of highway and traffic regulations.
In regard to the amendment reinstating the dangerous driving section of the code, I suggest this is one of the amendments I had in mind at the opening of my remarks this afternoon when I referred to the necessity of keeping our legislation in line with changes in our way of life and society, for the protection of our citizens. This bill also provides that a charge of criminal negligence can be reduced to a charge of dangerous driving. I suggest to the minister that he give consideration to the remarks made by the hon. member for Charlotte regarding subsection (3) of section 225, covering the operation of a vehicle by a disqualified individual. I shall not refer to this in detail now, but may do so at the committee stage. It seems rather strange to me that under this provision an individual is liable to two years' imprisonment upon conviction of an indictable offence because, as the hon. member for Charlotte pointed out, the matter of dangerous driving is one which is within the absolute jurisdiction of a magistrate, so that an accused person cannot elect to be tried by a judge or a judge and jury. Perhaps the minister will consider this situation and give some explanation in his reply.
The hon. member for Kootenay West (Mr. Herridge) mentioned the fact that he owns a model T car. I should hope that he drives it at an adequate speed because, should he not drive it fast enough, although he would not be in contravention of the dangerous driving section, he would undoubtedly be dealt with under the provincial motor vehicle act of the province of British Columbia.
That hon. member also mentioned the legislation referring to the making of telephone calls to the annoyance or nuisance of individuals. It has come to my attention that quite often calls are made and when the phone is answered the person on the other

end of the line hangs up, thus creating a great nuisance. I realize it is very difficult to check through the telephone companies and prove such matters but I would suggest to the minister that perhaps he might look into the nuisance that is caused with a view to doing something about it in the future.
The legislation with regard to sexual offences has been discussed fully and I do not intend to go into it. There are also amendments with regard to election involving offences where absolute jurisdiction has rested with the magistrate, and there are other matters of importance dealt with in the bill.
I do not wish to take any more time now except to say that the amendments with regard to sexual offences and the other changes in the Criminal Code that have been made since the minister became Minister of Justice show that he is carrying out a policy of attempting to rehabilitate many of the offenders and is making an effort to restore them to society as worth-while citizens. When the bill is discussed in committee there may be other matters of interest which I will have an opportunity to discuss further then.


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


Edmund Davie Fulton: Mr. Speaker, a number of important points which have been of some value have been made in the discussion and I wish to express my appreciation to all hon. members who have spoken for their suggestions which I am sure will be helpful to us when considering whether or not there are some amendments that should be made in committee. I also wish to express appreciation to all hon. members for their general indication of the support which the proposals embodied in the bill are receiving and will receive in all parts of the house. I will endeavour, as I think I should in recognition of the serious contributions that have been made, to deal with the majority, if not all, of the points that have been made, but if I omit any or omit reference to any hon. member particularly I would ask all hon. members to understand that this may well be because the same points in different form were made by a number of members and also because some of them lend themselves perhaps better to detailed consideration in committee. However, I wish to show hon. members, who have been very generous to me, the courtesy of dealing with all the points that have been made.
The hon. member for Niagara Falls (Miss LaMarsh) referred first to the important aspect of the new provision with regard to
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the small boat laws which concerns the question of enforcement by the provinces. I should like to assure her that there have been some discussions with the provinces, most particularly with the province of Ontario. It will be appreciated, of course, that in all provinces except Ontario and Quebec the provincial police service is provided by the R.C.M.P., and to some extent therefore the question of whether they are enforced under provincial or federal regulations is but a variation of the same problem in those provinces.
As was pointed out, it will be largely a question of whether or not adequate personnel can be provided for the discharge of this very heavy duty, a duty made particularly difficult because of the fact that the use of these boats mushrooms during the summer months and then falls off to practically nothing, at least on the inland waters of Canada, during the winter months. The problem, therefore, is one of having sufficient personnel to deal with the matter in the summer tourist months while not having so many men on your force that you have got nothing for them to do in the other months of the year.
In that connection I was particularly impressed with a suggestion made by the hon. member for Kootenay West (Mr. Herridge) that it might well be that some type of honorary or voluntary warden could be appointed and given some authority at any rate in connection with the enforcement of these laws. I am much struck with that suggestion and I have made a note to investigate, the moment I have time, the question of whether such persons, for instance, as game wardens might not be persons to whom it would be appropriate to give authority in this field. I would think that in a large number of cases, if not the majority, boats being used at resorts would be used in areas where there is a game warden or fisheries warden present. Therefore this strikes me as being a very excellent and apt suggestion.
In addition to the discussions which the R.C.M.P. have had with the provinces, I should point out that the Department of Transport has also had some preliminary discussions with the provinces regarding this whole matter and that it is their intention to follow up these discussions and have specific talks on the problem of licensing. I noted that all members, I believe, who referred to the small boat problem, referred to the question of licensing the operators of boats. It will be appreciated, of course, that here you have a question where we have to be careful because of the limits of constitutional authority, and it might well be that the licensing of boats is something which is

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within the authority of the provinces. In any event, it is desired and intended to discuss this question, and when and if a licensing system is worked out there can then be provision either that to operate a boat without a licence is a criminal offence, which could be provided subsequently, or if the licensing were to be done under provincial authority the provinces themselves could provide, in a manner similar to that which now prevails in the highway acts of the provinces, that the operation of a boat without a licence is an offence. We have very much in mind the desirability of working out a licensing system and then providing by the appropriate provincial or federal legislation that to operate a boat without a licence is an offence. Here again, of course, there would be room to take care of that point which many members raised that it is probably desirable to impose an age limit as a qualification for the operation of a boat with an engine say of more than three horsepower.
The hon. member for Niagara Falls referred also to the question of habitual criminals and the changes imported into the law by the bill now before the house. So that she will not think that I am omitting anything in the discussion, I should point out that one of the problems she referred to does not arise, I think, by reason of the fact that an application to have a person declared an habitual criminal or a dangerous sexual offender is not now heard by a jury. It is heard by a judge alone and the only change we are making in this respect is to provide that where the application is made subsequent to a conviction it should not be heard by the judge or magistrate who tried the specific offence which gave rise to the application.
I was also asked for the record with respect to habitual criminals and sexual offenders. The following are the records as of June 19, 1961, with respect to persons sentenced as habitual criminals. The total number sentenced was 54. The number who died in prison was four, leaving a total of 50. Of that number, 24 had been released on parole. Of the 24 released, four had had their parole revoked or forfeited, so that there are in custody or were in custody 30 habitual criminals. Of those 30, one had successfully appealed his conviction. As of this date, the actual number in custody was 29. The record with regard to parole is, as I have pointed out, 24 have been released on parole. Two have subsequently died; four have had their parole revoked or forfeited, so that there are actually 18 habitual criminals on parole at the present time.
The record of criminal sexual psychopaths, again as of June 19 this year, is as follows; The total number of persons sentenced under

that provision was 34. Of those, one had died in prison and nine had been released on parole. Of those nine, one had had his parole revoked or forfeited. There is, in custody at the present time under this provision, a total of 25 persons. Of those, one is appealing his conviction. Again, with respect to the record of the parolees, of the eight released on parole, one has subsequently died; one has had his parole revoked; one is in custody facing other charges. There are, therefore, five at present on parole who had previously been sentenced as criminal sexual psychopaths.
The hon. member for Maisonneuve-Rose-mont (Mr. Deschatelets) referred to the small boat regulations, and particularly the problem of young persons operating small boats. I hope he will agree that I have covered that and when a licensing system is worked out, which I think is most desirable, it will be possible to cover the question of those who should be licensed to operate boats with engines beyond a certain horsepower.
The hon. member for Kootenay West dealt also with this problem. I have noted his suggestion regarding temporary personnel being appointed with authority under these regulations. He asked me some questions concerning the penalty for removing boundary markers. This is found in section 384 of the code, and the maximum penalty at the present time, if I recall correctly, is five years. The section reads:
Everyone who wilfully pulls down, defaces, alters or removes
(a) a boundary mark . . .
is guilty of an indictable offence and is liable to imprisonment for five years.
The maximum penalty for this offence is quite severe at the present time. However, it is a fact that with the number of roads being built, and the widths and permanence of these roads, an increasing problem has been posed for surveys in that at the present time the code merely protects them where they carefully replace the necessary boundary mark as it was. With the type and size of highway being built now, it is becoming increasingly difficult to replace the mark where the surveyor took it up. It is for this reason the additional provision protecting the surveyor is being enacted, so that if he finds it impossible to replace the boundary mark he will be covered if he establishes a permanent record of the original position sufficient to permit such position to be ascertained.
I would think that with respect to the hon. member's point the surveyors should be required merely to establish reference marks so that it would not be necessary to run a line two or three miles in length to establish

the location of the original mark, the surveyors would be aware of this and would be inclined to establish such reference marks. There is nothing in the wording of the clause that would preclude that. I believe the wording of the clause suggests this. It says he is protected where he establishes a permanent record of the original position sufficient to permit such position to be ascertained. An offsetting mark would be the most readily means of establishing the original position. I will give consideration to the matter. I am unable to give my hon. friend a firm answer at this time, but I shall be glad to give consideration to it to see whether in committee or at perhaps some other appropriate time, a clarification is indicated.
The hon. member for Oxford (Mr. Nesbitt) also commented on the necessity and desirability of licensing operators of boats. We have, I think, covered that point sufficiently now.
The hon. member for Greenwood (Mr. Mac-donnell) raised the interesting and understandable point of the protection of those who are operators of small boats but who operate them without engines preferring-I am glad there are numbers in this country who do so prefer-to operate them with their own muscle power or by sail. He asked whether they would be protected by the words "dangerous to navigation". I would say they would be because he will note the section provides:
Everyone who navigates or operates a vessel or any water skis... in a manner that is dangerous to navigation, life or limb... is guilty of an indictable offence-*
If the operator or owner of a boat with a powerful engine goes sweeping past at a speed which endangers the life or limb of my hon. friend or others who share his commendable point of view, and there is danger of swamping the rowboat or sailboat, then there would be an offence under this section as we have drafted it.
The hon. member for St. Boniface (Mr. Regnier) raised a question as to whether it would not be desirable to provide more protection for the accused in connection with an application to have a man declared either a dangerous sexual offender or an habitual criminal. He suggested that it might be provided that the jury which heard the case should also dispose of the application. We had thought rather that the opposite principle should govern on the grounds that where a jury had also heard and disposed of a case- the application would not arise unless the accused had been convicted of that specific charge-it would then be undesirable to have the same court which had convicted on the specific charge deal with the application to
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have him declared a dangerous offender or habitual criminal. I want to remind the house again that these applications will not be dealt with by a jury in any event. The principle which we think should be applicable is that the judge who disposed of the charge on which the accused was convicted should not dispose of the application under this section because of the possibility of prejudice to the accused. We thought it should be a new judge or magistrate as the case may be.
The hon. member for Charlotte (Mr. Stewart) suggested that there should be some words in clause 5 of the bill to make it clear that the provision does not apply to commercial vessels but only to small, pleasure craft. I would be glad to give this matter further consideration but I must say that at first sight the suggestion does not appeal to me. After all, the offence that we are now importing into the criminal law is the navigation of a vessel in a manner that is dangerous to life or limb. I am not able to appreciate why commercial vessels should be exempt or placed in another class so that this provision would not apply to them.
I point out further for the hon. member's consideration that it is provided by a later subsection that, with respect to commercial vessels which are required to carry certificated masters, mates or engineers, the right of those persons to operate a commercial vessel cannot be taken away by a conviction under this section. The reason for that is that it is the Canada Shipping Act that at present provides for the qualifications of persons who shall have certificates as masters, mates or engineers. We think that is the proper place where those provisions should rest and that the taking away from one of these persons of his right to operate a vessel for which he is certificated should remain under the shipping act. What is intended here is that if a person operates a vessel, whether it be a commercial craft or a pleasure craft, in a manner that is dangerous to navigation or life or limb, then he commits a criminal offence; and if he is the owner and operator of a pleasure craft he may be prohibited from operating that craft. However, if he is the certificated master, mate or engineer of a commercial vessel, then the question of whether or not he has his certificate taken away from him rests to be disposed of under the Canada Shipping Act.
Then the hon. member for Charlotte and also the hon. member for Pictou both raised the question as to whether it is wise to provide, as we have provided in subclause 2 of clause 4, that a charge of operating a motor vehicle while disqualified or prohibited from driving by reason of a previous conviction,

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should be made an indictable offence as well as an offence punishable on summary conviction as it is now. The reason for their concern, if I understood them correctly, is that this was an offence within the absolute jurisdiction of a magistrate and that to provide that it is now also an indictable offence would have the effect of giving to magistrates, about whose qualifications there are sometimes some reservations, the power to impose punishments of two years and more. With respect I think I must take issue with the hon. gentlemen. I have not had time to check this matter out completely since it was raised, but it is my impression that this charge would not be within the absolute jurisdiction of a magistrate. It may be that the offence for which they were originally convicted and on the basis of that conviction were prohibited from driving was within the absolute jurisdiction of the magistrate. However, I question whether the charge which is involved here, namely the charge of driving a motor vehicle while under an order of prohibition, is under the absolute jurisdiction of a magistrate. The study I gave to it in the few moments since the question was raised rather persuades me that it is only triable by a magistrate with consent. If that is correct-and I will have a further check made on that matter-it would, I hope, dispose of the reservations expressed by my hon. friends.
I think that covers the points that were raised, Mr. Speaker. If I have left any out or if I have not covered them adequately I shall try to make amends when we are in committee on the clauses.


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


Some hon. Members:: Question.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Flynn in the chair.
On clause 1.
Julia Verlyn (Judy) LaMarsh: By virtue of the fact that the bill has not been given to us in time for us to make a very detailed study of it and also by virtue of the fact that, as I have no doubt, the minister has brought in the amendments as a result of some difficulties which have been created in the past and recommendations which have been made, may I ask that the minister, as we approach each group of sections dealing with different subjects, give us some background on what the present law is, why it has not been found to be fitting and why an amendment has been brought in. The explanatory notes are very brief, of course, but it would be of great assistance to
IMr. Fulton.]
us, as we have not had very long to study the matter, if the minister gave us a brief introduction.


Edmund Davie Fulton: Yes. I think clause 1 stands by itself. It is made necessary by the fact that last year we amended both the Yukon Act and the Northwest Territories Act in order to set up courts of appeal for those territories. Prior to that time it had been necessary for them to have recourse to the courts of appeal of certain of the provinces, but now they have a court of appeal in the territories. We are therefore changing the words here in order to provide that, in the Yukon Territory, it is "the court of appeal" instead of "the court of appeal for the province of British Columbia" and similarly with regard to the Northwest Territories.


[Stage Direction]
Clause agreed to.
On clause 2-Service of Process.
Julia Verlyn (Judy) LaMarsh: I hesitate to be on my feet all the time, but it may be that in clause 2 the minister has done something which it was not the intention to do. I was just idly looking at subparagraph (a). In the case of a municipal corporation service will be made on the mayor, secretary-treasurer or clerk of the corporation. I am thinking of one municipality in my riding in which there is no mayor, no secretary-treasurer or no clerk. Therefore it would be impossible to effect service. I know that the minister is a big city boy and it may be that most of the people on the other side of the house are in that category. I am not sure about all the provinces, but in the province of Ontario we have municipalities which do not have as their head a mayor; they are reeves. There are many cases of municipalities which do not have a secretary-treasurer. They may have a secretary or a treasurer but they are not always a secretary-treasurer. In those cases there is often no clerk. In the one municipality, a village of which I was thinking, you would find there was a reeve, a secretary and a treasurer but none of the three offices which are indicated in subsection (a). I wondered whether it might be considered by the minister that this subsection should stand and that some consideration be given to the fact that there are municipalities other than cities whose heads are not mayors. In the Ontario municipal act the matter is covered by a reference to the head of the municipality, not the mayor or the reeve.


Edmund Davie Fulton: I think I can only say that, far from being a big city person myself, I am a small town lawyer and proud of the fact. I am therefore prepared to admit that the hon. member has a point there the

answer to which I do not have at the moment. If there is a municipal corporation that has no mayor or secretary-treasurer or clerk,
I do not know what the answer would be. It may be that the Interpretation Act would provide us with an answer but we shall be glad to look into that matter. Perhaps in the meantime the clause might stand. I am afraid that we may have fallen into the error of taking it for granted that, because an almost identical provision appears twice elsewhere in the code, it had been tried and found not wanting. Perhaps it just has not been tried. Perhaps also the municipal corporations of these small places that my hon. friend has in mind would never be guilty of anything requiring service of process under the Criminal Code. I think that would be the most likely answer, Mr. Chairman.


Julia Verlyn (Judy) LaMarsh: That undoubtedly is the answer.


Jacques Flynn: Shall clause 2 stand?


Some hon. Members:: Agreed.
Clause stands.
Clause 3 agreed to.
On clause 4-Order prohibiting driving.


Edmund Davie Fulton: Mr. Chairman, I find that I did not have time to make the necessary study after the hon. member for Charlotte and the hon. member for Pictou raised a question regarding giving magistrates absolute jurisdiction to try the offence of driving a motor vehicle while disqualified.
In this bill we have provided that it shall be indictable, and by virtue of clause 18 within the absolute jurisdiction of the magistrate. It has not previously been indictable, but it will be indictable and absolute when this bill is passed. I have had my memory refreshed now and I am reminded that the reason why we thought this was appropriate was because it is a relatively simple issue; it is not a difficult legal issue. The issue is simple: has an order prohibiting driving been made, and was the accused driving the motor vehicle while under that prohibition?
It is not a difficult legal issue and therefore we thought it was one quite appropriate to leave in the hands of the magistrate, even though the penalty has been increased. The penalty has been increased for the reason referred to by several hon. members, namely that we think it is a serious matter and persons should be required to take seriously an order prohibiting them from driving.


[Stage Direction]
Clause agreed to.
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On clause 5-Dangerous operation of vessel, etc.
Jean-Paul Deschatelets: Mr. Chairman, with regard to clause 5, suppose a child of 11 or 12 years of age is guilty of an offence under this clause, what would happen in that case? We are dealing here with the penal law.


Edmund Davie Fulton: Of course, the case could be tried in juvenile court. I do not think the position here is any different from that of a child accused of another criminal offence.


Jean-Paul Deschatelets: I know of the case of a young boy of 10 years of age who was driving a motor boat on a lake-I think it was in the riding of Joliette-L'Assomption-Mont-calm-a few years ago and four people were drowned. The father was arrested on a charge of manslaughter because of his negligence in performing his duty as father of the child. He was acquitted, by the way. In my remarks a few minutes ago I suggested to the minister that we should provide a minimum age for operating certain classes of boats. I wonder whether the minister has any comment to make on this matter.


Edmund Davie Fulton: Mr. Chairman, I think the position here is simply one of the general application of the provisions of the Criminal Code, which set the absolute age below which no person shall be charged with a criminal offence. As I recall, the age is seven years. In the case of an indictable offence by a child over 14 years of age it would be in the discretion of the juvenile court whether he should be prosecuted under the Criminal Code in the ordinary courts or whether the case should be proceeded with in the juvenile court. However, because the Juvenile Delinquents Act is not in force in all parts of Canada it would be quite inappropriate for us to say that children of a certain age must have their cases disposed of in juvenile court. We think we should merely create the offence and then leave it to the determination of the authorities in the ordinary way as to the method by which these cases are dealt with.


[Stage Direction]
Clause agreed to.
On clause 6-Theft of telecommunication service.
Herbert Wilfred Herridge: Mr. Chairman, I should just like to ask the minister this interesting question; that is, interesting to me. In the first part of clause 6 the word "colour" is spelt c-o-l-o-u-r. Why is the Oxford dictionary spelling, which is the preferred spelling, used in the clause and the Funk and Wagnalls dictionary spelling, which is the United States spelling, used in the explanation? Does this

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represent a difference of opinion in the minister's department, or a concession to the United States?


Edmund Davie Fulton: Mr. Chairman, I think it might be said to represent a very neat compromise. I could rationalize this by saying that in the code itself the spelling "o-u-r" is used throughout, but in the explanatory note- which is of course of no statutory value in so far as the bill itself is concerned-we have apparently used the spelling "o-r". We have at least saved one letter in the explanatory note.


Herbert Wilfred Herridge: Is it the practice of the department, in the spelling of words, to use the Oxford dictionary style of spelling?


Edmund Davie Fulton: Yes, that is correct. The "color" in the explanatory note is a typographical error.


Herbert Wilfred Herridge: Thank you. I am very glad to hear that.


[Stage Direction]
Clause agreed to.
On clause 7-Presumption from cheque issued without funds.
Jean-Paul Deschatelets: Mr. Chairman, would the minister give an explanation of the reasons for this amendment, or perhaps the representations which were made in connection with this proposed amendment.


Edmund Davie Fulton: Mr. Chairman, this arises primarily out of the fact that there was a case where a cheque was drawn on an institution that was not a bank and a conviction could not be obtained. Since caisses populaires, credit unions and other legitimate and worthy institutions which are not banks have increasingly entered into this field and to all intents and purposes have cheques drawn upon them, we thought this was an omission in the Criminal Code which should be rectified. The amendment is simply to add the words "or other institution".


[Stage Direction]
Clause agreed to.
Clause 8 agreed to.
On clause 9-False messages.
Julia Verlyn (Judy) LaMarsh: Mr. Chairman, would the minister tell the committee how it is proposed to convict anyone of this offence. What kind of evidence could be adduced in connection with threats made by telephone? I think it is an excellent provision, if you can make it work.


Edmund Davie Fulton: Mr. Chairman, it might be difficult, but on the other hand I think it might be possible. Certainly in so far as a telegram is concerned it should be possible to establish that a certain person actually 
conveyed information in a telegram. In connection with the telephone, it is possible to obtain direct evidence that a telephone call came in at a certain time and a certain person actually placed that call at that time. I do not think it would be easy, but we certainly think the actions described here should be made an offence.


Julia Verlyn (Judy) LaMarsh: May I suggest it is more in the nature of an educative process; it is there, and that is supposed to deter people from doing it, even though it may be very difficult to prove?


Edmund Davie Fulton: I have never been one to place too much store on the deterrent effect of criminal legislation. We had that discussion in connection with the capital punishment bill. However, if the course of action were persisted in, I think my hon. friend will appreciate that certain checks could be made that would establish the facts with reasonable certainty and might well support a prosecution.
Certainly in the casual or isolated call I doubt very much whether you could ever obtain the evidence, but if it were a course of conduct persisted in, I think it might well be possible to obtain the evidence.


Jean-Paul Deschatelets: Mr. Chairman, I said in my remarks a few minutes ago, and I think the hon. member for Kootenay West said the same thing, that clause 9 does not cover the most ordinary case of nuisance by telephone. The first and second parts of this clause provide:
(1)	Every one who, with intent to injure or alarm any person, conveys or causes or procures to be conveyed by letter, telegram, telephone, cable, radio, or otherwise, information-
(2)	Every one who, with intent to alarm or annoy any person, makes any indecent telephone call to such person is guilty of an offence punishable on summary conviction.
These are not the ordinary cases. I think the most common case is simply annoyance by telephone

somebody would phone 25 times in a day and when they answered they would hang up the phone. It is not covered.


Edmund Davie Fulton: That is true. I do not think the case of a person who places a call and hangs up as soon as he hears a telephone lifted at the other end is covered by this section. An attempt to deal with it here might possibly create an offence more embracing than was intended or desired. There might be a number of innocent explanations as to the reason for hanging up at the other end. It might be that on two or three occasions an innocent explanation would prevail. Perhaps a mother who was calling would have to hang up the telephone to go to a child who had fallen. We feel that the

section here has gone as far as is to be desired and that the danger of such a course as has been suggested would outweigh any possible advantages.


Julia Verlyn (Judy) LaMarsh: The minister and his
department might consider putting something similar into the nuisance section to make it an offence to annoy another person by telephone calls. This would not be such a serious offence and it would not be so difficult to prove.


Edmund Davie Fulton: We shall be glad to look at that suggestion if it is not covered already by the nuisance section, and see whether we can adopt it.


[Stage Direction]
Clause agreed to.
On clause 11-Saving provision.
Herbert Wilfred Herridge: I want to thank the minister for explaining what the penalty was. I did not realize it is as severe as it is. This is an increasing problem, especially in backwoods areas. People go hunting and pull up a stake or something of that sort, knowing they should not do it but not realizing the damage they are causing. I know of one case where it cost $1,500 to relocate a stake because they had to go back many miles to relocate timber limits by reference to other markers.
I wonder if it would be possible to have some small notices made available, or what other steps could be taken to give publicity to this matter. I know that is a provincial matter, but the minister's officials are in contact with the provincial attorneys general and it seems to me that this question might well receive some publicity even in local post offices because I am sure the majority of people do not realize how serious it is. It is impossible to find out who does these things when this damage is done miles from anywhere. I wonder if there is any way of bringing this to the attention of attorneys general.


Edmund Davie Fulton: I am sure this could be drawn to the attention of attorneys general and they might decide to give some publicity to it but that, of course, is something they themselves have to decide. Perhaps this discussion today and the reminder that the penalty is five years may go a long way to serving the purpose the hon. gentleman has in mind.


[Stage Direction]
Clause agreed to.
On clause 12-Exception.
Gabriel Roberge: What is the exact purpose of this clause and also clause 13? Will the minister give us the background?


Edmund Davie Fulton: Clause 12 deals with the situation which arises when a person charged with
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an offence in one province wishes to plead guilty to an outstanding offence in another province. Clause 13 deals with the situation where an accused person charged with an offence in a province wishes to plead guilty to an outstanding charge against him elsewhere in the same province. The purpose of both clauses is to enable all the outstanding charges against an accused person to be disposed at one time so that he does not have to face a situation where, having served a sentence on one charge he is liable to be apprehended in the same or another province and prosecuted again.
At the present time in both cases the consent of the attorney general of the province concerned is necessary before an accused person can plead guilty to other charges. We have thought this should be preserved only in the case where a charge is outstanding in a different province. There the consent of the attorney general of that province will still be necessary before the charge can be disposed of. But where the outstanding charge is in the same province we feel the accused person should have the absolute right to have all the charges disposed of at the same time. We feel there is not the degree of administrative or other difficulty which would warrant anyone refusing to allow the accused to have the charges all to be disposed of at the same time when they arise in the same province. But where the outstanding charge is in another province we have retained the necessity for obtaining the consent of the attorney general of such province but we provide that it may be given by the deputy attorney general because it does not seem logical to insist that the attorney general must personally sign all these documents.


Gabriel Roberge: One of the phrases in the clause reads this way: "Where the accused is in custody". Does that mean in custody undergoing punishment or in custody waiting to be tried for an offence? Would it include waiting to be tried for an offence and being out on bail, even?


Edmund Davie Fulton: I understand that the better view is that this would apply on either occasion, when a man is in custody pending the disposition of a charge or when he is in custody following conviction. I would remind the committee that the Fauteux commission made a recommendation on these lines and the change has also been asked for by the uniformity commissioners, who represent the attorneys general of the provinces.


[Stage Direction]
Clause agreed to.
[Stage Direction]
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On clause 14-By peace officer.
Julia Verlyn (Judy) LaMarsh: Would the minister say whether this provision will be of some assistance to us in the riding of Niagara Falls so that peace officers will be entitled to arrest without warrant anyone who throws himself into the upper Niagara river?


Edmund Davie Fulton: I think that would be left to the discretion of the peace officer.


Jean-Paul Deschatelets: What is the reason for spelling out attempted suicide here? I thought that was covered by the former section.


Edmund Davie Fulton: Under the Criminal Code, attempted suicide is only punishable on summary conviction, so a peace officer could not arrest without a warrant merely where he has reasonable and probable grounds to believe. In order to make it possible for these officers, who are confronted with a situation where a man is about to jump over a bridge, to arrest the individual, one has to make attempted suicide punishable as an indictable offence.


Jacques Flynn: Shall clause 14 carry?


Edmund Davie Fulton: I am sorry, but the change that has to be made is one that provides that a peace officer may arrest without a warrant, where he has reasonable and probable grounds to believe that a person is about to commit suicide.


[Stage Direction]
Clause agreed to.
Clause 15 agreed to.
On clause 16.
Edmund Davie Fulton: The amendments to clauses 16 and 17, Mr. Chairman, are consequential upon the capital punishment bill that passed through the house a few weeks ago.


[Stage Direction]
Clause agreed to.
Clauses 17 to 25 inclusive agreed to.
On clause 26.
Edmund Davie Fulton: Mr. Chairman, in respect to clause 26, my hon. friends opposite asked if I could give the background. Clause 26 is the clause which arises out of the recommendation of the McRuer commission on the law of insanity.


[Stage Direction]
Clause agreed to.
Clauses 27 to 31 inclusive agreed to.
On clause 32-Dangerous sexual offenders.
Julia Verlyn (Judy) LaMarsh: Mr. Chairman, I should like to ask the minister what the purpose was of adding the words "or is likely to commit a further sexual offence," to the definition as recommended by the commission?


Edmund Davie Fulton: This idea was suggested by the uniformity commissioners as being a further test available to the court on the basis of which it could reach a conclusion as to whether or not a person should be adjudged a dangerous sexual offender. I think the hon. lady will agree that this creates a second and alternative test as a basis on which to form a judgment, and we felt it was a proper proposal.


[Stage Direction]
Clause agreed to.
On clause 33-Application for preventive detention.
Laurier Arthur Régnier: Mr. Chairman, a portion of this clause reads as follows:
Where an accused has been convicted of an indictable offence the court may-
Whereas, section 661 reads in part:
Where an accused has been convicted-
When we consider section 662 we find that it provides that seven clear days' notice must be given to the accused before conviction, and then at page 13, paragraph (b) also provides that either before or after conviction notice may be served. I should like the minister to explain, regarding the service of notice, how an application can be made for an indeterminate detention before there is a conviction?


Edmund Davie Fulton: Mr. Chairman, the answer to that question is that if the crown has in its possession, before the trial commences, evidence of the record of the accused in respect of other matters which, in the opinion of the crown, establish that the accused is an habitual criminal or a dangerous sexual offender then the crown can decide at that point to make application to have the individual so declared. Under those circumstances this amendment makes it clear that notice of this application may be given before or after conviction.


[Stage Direction]
Clause agreed to.
On clause 34.
Julia Verlyn (Judy) LaMarsh: Mr. Chairman, again I wonder why the minister or his department have varied substantially from the terminology of the McRuer commission in its recommendation in regard to section 661 (3), which suggests that where the court finds an accused to be a dangerous sexual offender it shall, notwithstanding anything in this act or any other act of the parliament of Canada, sentence the accused to preventive detention; whereas the bill before us suggests that the sentence of preventive detention shall be in lieu of any other sentence that might be imposed, or in addition to any sentence that

was imposed if that sentence had expired. Why is it necessary to add those words?


Edmund Davie Fulton: The answer to that is that we have included here the additional principle of providing that the crown may make application subsequent to conviction and sentence. We felt, in conformity with the intent of the McRuer commission's recommendation, that after the accused had been sentenced to a determinate period and the application was granted, then the court should impose an indeterminate sentence in lieu of the determinate sentence that had already been imposed. I think this carries out the intent of the McRuer recommendation, varying only because of the circumstances which we now are including, and which were not contemplated by the McRuer commission.


Julia Verlyn (Judy) LaMarsh: Mr. Chairman, there is a principle of law that once a trier has heard a case and has come to a conclusion he is functus. In this case, where the judge has tried the matter, has convicted and imposed a short term of sentence, following which an application is made, within the three-month period, to another judge to have the individual declared a dangerous sexual offender, the other judge may sentence the individual to an indeterminate period in lieu of the first sentence. In other words, the second judge, who has not been seized with the case at all, has the rights of an appeal court and can wipe out the determinate sentence and substitute an indeterminate sentence.


Edmund Davie Fulton: I do not think there is anything contained here beyond the principle that a court of appeal may vary a sentence. All we are doing in principle is allowing a change in the sentence and providing by statute that, where a person is adjudged to be a dangerous sexual offender, the court that makes that finding shall impose an indeterminate sentence. The statute then says that the sentence is in lieu of the determinate sentence which may already have been imposed. I think this principle carries out the intention of the McRuer commission report.


Julia Verlyn (Judy) LaMarsh: It was my understanding that the only thing which could disturb a sentence, once properly made by a court with proper jurisdiction, was an order of the court of appeal or the exercise of executive clemency. However, this clause states in part:
Where the court finds that the accused is a dangerous sexual offender it shall-impose upon the accused a sentence of preventive detention in lieu of any other sentence that might be imposed-[DOT]
That seemed to involve a major departure from the usual practice.
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Edmund Davie Fulton: I suggest this clause tidies up the situation.
If my hon. friend's point has relation to the suggestion that the statute should say instead of "in lieu of any other sentence" that the sentence shall take the place of an earlier sentence, that might well have been said; but I would suggest that is just a matter of words. It is a new court trying a new issue, the issue of whether or not the accused is a dangerous sexual offender or habitual criminal. That is the only issue that that court is trying. That court is not retrying the question of guilt or innocence on the original charge. The statute says that if you find he is in one of these two categories then you shall impose an indeterminate sentence which shall be in lieu of the determinate sentence that was previously imposed.


Julia Verlyn (Judy) LaMarsh: Can the minister think of an analogy involving anything now existing in the criminal law which supports this?


Edmund Davie Fulton: I do not think so.
At six o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 7.30 p.m.
Gabriel Roberge: Mr. Chairman, when we recessed at six o'clock we were dealing with clause 34. I should like to address myself to that provision, especially that part of it which provides that the court shall hear the evidence of at least two psychiatrists, one of whom shall be appointed by the attorney general. If one of these psychiatrists is to be appointed by the attorney general, who is going to appoint the other one?


Edmund Davie Fulton: Well, the other psychiatrist could be appointed by the court or he may be called by the crown prosecutor simply as an expert witness, whether or not he has been nominated by the attorney general. One of the two psychiatrists must be actually nominated by the attorney general of the province.


Gabriel Roberge: If I understand the procedure correctly, one is to be appointed by the attorney general and the services of the other one might be retained by the crown prosecutor. Under our system, the crown prosecutor is nothing more nor less than a representative of the attorney general. If the second one is nominated by the court, then this is done under the authority of the attorney general.


Edmund Davie Fulton: Not if he is appointed by the court or if the accused calls a psychiatrist. Then, the accused's psychiatrist would be one

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of the two. In the normal case the accused will call psychiatric evidence. If he does not, then the crown has to call two psychiatrists, one of whom has been directly nominated by the crown for the purpose.


Gabriel Roberge: As a rule, I would think the accused would not have the means to permit the calling of a psychiatrist. On the other hand the crown prosecutor will call one appointed by the court and the accused would not have anyone to testify on his behalf. In those cases, who is going to pay for the psychiatrist if the accused does not call one?


Edmund Davie Fulton: If the accused does not call one, then the crown has to call a second one and the crown would have to pay for the psychiatrist.


Gabriel Roberge: When is the crown going to know that the crown needs another psychiatrist in addition to the one appointed by the attorney general?


Edmund Davie Fulton: Presumably the crown would consult with the defence attorney. If the defence attorney is not going to call anyone then the crown would. Normally, psychiatric consultations of this sort are carried out by two psychiatrists. They need not be called unless the defence does not call one, in which case the crown has to call the second one. If the crown attorney is intelligent and anxious to discharge his duty under the section, he will have retained and instructed a second psychiatrist who will be available on short notice if a second psychiatrist is needed in addition to the one nominated by the attorney general.


Gabriel Roberge: I understand the situation and the responsibility of the attorney general. I would venture to suggest that in most cases the defence attorney will say, I am not calling any psychiatrists, so the crown will have to provide two of them and pay for them. Does the minister not think more consideration should be given to that clause? I agree that two psychiatrists should be called, one of whom should be nominated by the attorney general and paid for by the province, but the other one should be appointed at the request of the defence and paid for by the province.


Edmund Davie Fulton: I do not know that that would work very well in practice. This provision has been in the code ever since this section with regard to habitual criminals was enacted. This afternoon I gave figures relating to the number of persons who have been committed under both the habitual criminal section and the sexual psychopath section. The total was 88. In both cases, the committal is made on the evidence of two psychiatrists,

one of whom is nominated by the attorney general. That is 88 cases altogether. I have never heard that the provision did not work out satisfactorily.


Paul Joseph James Martin: Does the minister think that, where the section says "one of whom shall be nominated by the attorney general" the crown has the right to nominate two?


Edmund Davie Fulton: Just before answering that question may I say this, I was guilty of an inaccuracy. The provision with regard to the appointment of psychiatrists does relate only to criminal sexual psychopaths of whom there have been 34 sentenced up to the present time. The hon. member for Essex East asked another question?


Paul Joseph James Martin: I simply point out that subsection 2 says "one of whom shall be nominated by the attorney general". The attorney general is not given power to nominate more than one.


Edmund Davie Fulton: Oh, I think that the attorney general does not require power to nominate more than one. The attorney general or the crown can call as much evidence as the court is prepared to hear. Where the section says that the court shall hear the evidence of at least two psychiatrists, certainly the court would hear the evidence of the two who were called by the crown. I am quite satisfied of that.


Julia Verlyn (Judy) LaMarsh: May I ask the minister this question. In the 34 cases which have been tried and in which there were convictions, could this situation not very easily occur? In the case where defence counsel and crown counsel did not consult together-and it is not unknown by any means in the criminal law, where defence counsel simply refuse to say whether they are going to call anyone- as a practical matter it would mean that in every case the crown would have to be prepared to put on two psychiatrists; they would not put on one and then wait to see whether one was called by the defence. Otherwise they would fail in their application.


Edmund Davie Fulton: I quite agree. That is what I intended to say before.


Julia Verlyn (Judy) LaMarsh: Practically the crown would be ready with two.


Edmund Davie Fulton: Yes; the crown would be ready with two.


Mr. Bell (Carleton):: There is no change in the section.


[Stage Direction]
Clause agreed to.

On clause 35-Notice of application.
Jean-Paul Deschatelets: This amendment has to do with the application to have an accused adjudged a dangerous sexual offender. I do not understand why in the amendment this application can be made before the conviction. As the minister knows, with regard to the habitual criminal the application by the crown must be made after the accused is convicted. I do not understand the reason why it can be made before the conviction.


Edmund Davie Fulton: This is to parallel the provision with regard to dangerous sexual offenders. I would think it desirable, if the crown has knowledge of the record of the accused, that it should give notice of intention to make this application even before conviction so that the accused and his counsel will have as much notice as possible of the likelihood of the application for such considerations as that might give rise to in their minds during the hearing of the charge upon which the accused is presently in court.


Jean-Paul Deschatelets: The minister will no doubt appreciate the fact that by this notice being given before the accused is found guilty, it might prejudge the whole trial. After all this man will be charged with an offence. Why do we not wait until he is found guilty?


Edmund Davie Fulton: The notice is not given in open court. If it is a jury trial, it will not be in the knowledge of the jury at the time. A notice is filed with the clerk of the court and served on the other side. There will be no reference to it. The fact that this notice has been given is not relevant and therefore would not be in evidence and no reference could be made to it in evidence on the specific charge for which the accused is on trial.


Laurier Arthur Régnier: The French translation of the section is absolutely contrary to the English interpretation. As found at page 13 of the English version, section 262, subsection 4 reads as follows:
(4) Where an application under subsection (1) of section 660 or subsection (1) of section 661 has not been heard before the accused is sentenced for the offence for which he has been convicted, the application shall not be heard by the judge or magistrate who sentenced the accused but may be heard by any other judge or magistrate who might have held or sat in the same court.
The French version of it, found at page 14, reads as follows:
(Translation):
Where an application under subsection (1) of section 660 or subsection (1) of section 661 has not been heard before the accused is sentenced for the offence for which he has been convicted, the application shall be heard by the judge or magistrate who sentenced the accused but may be heard by any other judge or magistrate who might have held or sat in the same court.
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That is exactly the contrary of what is prescribed in the English version, which states that the application shall not be heard by the judge or magistrate who sentenced the accused.


Edmund Davie Fulton: Mr. Chairman, before recess, the hon. member for Berthier-Maskinonge-De-lanaudiere (Mr. Paul) called my attention to this discrepancy. This is obviously an error in translation and it will be corrected in a subsequent translation.
(Text):
For the benefit of my hon. friends whose mother tongue is the English language and having regard to my rather tortured French, I think what I said should be reproduced in both languages. There is an obvious error which was drawn to my attention during the dinner recess. I am informed that such errors, not being differences in the meaning or rendering but rather obviously complete errors of translation, are taken care of in the normal course when they are drawn to the attention of the officials.


Laurier Arthur Régnier: Also, if the application is not heard by the judge who has tried the accused, I do not see here any provision for a transcript of the evidence which another judge would need to have in front of him before he could hear the application. I think the accused would also be handicapped if the transcription of the evidence at the trial is not provided to the accused. As has been pointed out previously, these people sometimes simply cannot afford to pay for the transcription of a long trial.


Edmund Davie Fulton: Mr. Chairman, there is no change here with respect to the application to have a person declared a habitual criminal, and that is what is referred to in the part under discussion. My hon. friend will notice that there is to be seven clear days' notice to the accused specifying the previous convictions and the other circumstances, if any, upon which it is intended to found an application. So a complete notice is served on the accused of the circumstances upon which it is intended to rely in support of the application.


Laurier Arthur Régnier: Mr. Chairman, I have not consulted the bill, but the clause the minister has read to the committee provides that the convictions shall be specified in the notice. However, the bill provides for the notice to be served before conviction; at least, it could be served before conviction. Therefore how could the conviction be specified in the notice?


Edmund Davie Fulton: In that case obviously the conviction is not one of the grounds which is alleged in the notice, because it has not yet

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taken place. Therefore the words that would be relevant there would be, "Specifying the previous convictions and the other circumstances, if any, upon which the crown intends to rely in support of the application."


[Stage Direction]
Clause agreed to.
Clauses 36 to 38 inclusive agreed to.
On clause 39-Review by Minister of Justice.
Jean-Paul Deschatelets: Mr. Chairman, I understand that when a person is sentenced to preventive detention the Minister of Justice shall, at least once in every year, review the condition, history and circumstances. How will that work? Has the national parole board anything to do with it, or the national parole board under the authority of the Minister of Justice?


Edmund Davie Fulton: Mr. Chairman, the present provision in the law is that the Minister of Justice shall review the case of a person in custody under sentence of preventive detention at least once every three years. We are now reducing that period to once every year. Section 24 of the Parole Act provides that the duties of the minister under this section are exercised by the national parole board. The relevant provision reads as follows:
The powers, functions and duties of the Minister of Justice under section 666 of the Criminal Code are hereby transferred to the board and a reference in that section to permission to be at large on licence shall be deemed to be a reference to parole granted under this act.
So where the section provides, as will be the case from now on:
-the Minister of Justice shall, at least once in every year, review the condition, history and circumstance of that person for the purpose of determining whether he should be permitted to be at large on licencethat duty of review is transferred automatically to the national parole board.


[Stage Direction]
Clause agreed to.
Clauses 40 and 41 agreed to.
On clause 42-Custody for observation.
Julia Verlyn (Judy) LaMarsh: Mr. Chairman, I have been looking at the Criminal Code and section 710 deals with the rights, amongst others, of adjournment and what the summary conviction court may do. I am wondering how in this case, where the magistrate may send a defendant for observation for a period not exceeding 30 days, this clause can be reconciled with subsection 1 of section 710 of the Criminal Code, which provides of course that there may be no adjournment of a trial of more than eight days.


Edmund Davie Fulton: I think the answer to that question is that this proposed new subsection starts out with the words:
Notwithstanding subsection (1),-


[Stage Direction]
Clause agreed to.
Clauses 43 to 46 agreed to.
Title agreed to.
Jacques Flynn: Shall we revert now to clause 2, which stood?


Some hon. Members:: Agreed.
On clause 2-Service of process.


Edmund Davie Fulton: Mr. Chairman, I wonder
whether the hon. member has any suggestion she would care to put forward. I had thought of amending the clause by putting in the words "or other executive officer", but if my hon. friend has another suggestion I would be very glad to hear it.


Julia Verlyn (Judy) LaMarsh: Mr. Chairman, I am not sure of the phraseology in municipal acts outside the province of Ontario, but there the phraseology that is often used is, "head of the municipal authority or statutory officer".
I cannot assist the minister as to whether these words are used outside the province of Ontario, but the words put into this clause might be something in the nature of "head of the municipality", or we might even enumerate "the mayor, secretary, treasurer, clerk of the corporation or person holding equivalent status", or something of that sort. It is a little loose, but it might cover it.


Edmund Davie Fulton: Would the hon. member agree with me that "reeve" would normally cover every case of a municipality that does not have a mayor?


Julia Verlyn (Judy) LaMarsh: No, not altogether. There are, of course, the counties or districts where a warden is the head of a municipality, and the definition section of the Criminal Code says that a municipal corporation includes a district, a county, and a number of other designations. I am not very familiar with the section.


Paul Joseph James Martin: Township?


Julia Verlyn (Judy) LaMarsh: It includes a city, town, village, county, township, parish or other territorial or local division of a province the inhabitants of which are incorporated. I do not know what the head of a parish might be called.


Edmund Davie Fulton: Would this serve the purpose, in my hon. friend's opinion, in the case of municipal corporation, "the mayor, reeve, warden, secretary, treasurer or clerk of the corporation or the elected head of the municipality as the case may be"?


Mr. Bell (Carleion):: May I suggest, Mr. Chairman, that a warden should come before a reeve.


Julia Verlyn (Judy) LaMarsh: The hon. member for Es-quimalt-Saanich might not agree. It has been called to my attention that the heads of improvement districts are not elected but are appointed.


Mr. Lennard:: Mr. Chairman, I am not a
learned gentleman, but a warden might be just the reeve of his township. He is selected by the reeves and heads of other municipalities. I do not think a warden should figure in this picture at all.


Julia Verlyn (Judy) LaMarsh: I suggest he does, because of the interpretation section, which covers a county municipality, and the head of the county municipality is a warden.


Laurier Arthur Régnier: Also, the clerk is not an elected head of a municipality; he is just the appointed official.


Richard Albert Bell: Mr. Chairman, before we actually amend this clause I should like to know whether the hon. lady from Niagara Falls can tell us of any difficulty that has occurred previously in respect to the operation of subsection 5 of section 441. That appears in the explanatory note opposite page 6. That section is now repealed and its provisions are included in clause 2 which we are now discussing. I am not aware that there have been any difficulties in respect to the operation of subsection 5 of section 441. If there have been none, I wonder whether we would be doing a useful service in making an amendment.


Julia Verlyn (Judy) LaMarsh: I can only say that I assume whoever drafted subsection 6 of section 441 in the code intended that it should cover every municipality in Canada and that if there was an error it was not pointed out at that time. I would suggest that even to a Conservative the progressive nature of correcting must be self-evident, and in the future it may be of some importance. I have no idea when this has ever been used, but I assume that the house intends that if there is a criminal act which is chargeable against a municipal corporation there be some method by which a warrant may be served, otherwise they would necessarily escape criminal action.


Paul Joseph James Martin: I do not like to disagree with the hon. member for Niagara Falls but for the first time in a long time I am inclined to think there is some merit in the point made by the hon. member for Carleton. In any event there will always be a secretary-treasurer or a clerk of a municipality.
Criminal Code


Julia Verlyn (Judy) LaMarsh: With respect, as I pointed out earlier while the hon. member for Essex East was not present, there are municipalities which do not have secretary-treasurers or clerks. I can think of a municipality in my own riding which has a secretary and a treasurer but no clerk as such. Its head is a reeve.


Paul Joseph James Martin: Yes, but there is always a secretary-treasurer.


Julia Verlyn (Judy) LaMarsh: No, there is a secretary and a treasurer.


Gordon Harvey Aiken: Everyone else has had a go at this so perhaps I could make a comment. I think the case would be well settled if we took the hyphen from between the words secretary and treasurer and inserted a comma. I think that if the hyphen were taken out and replaced by a comma it would cover every eventuality.


Edmund Davie Fulton: I was working on the same idea as my hon. friend from Parry Sound-Muskoka. It occurred to me that if an officer is a secretary-treasurer he is also a secretary and a treasurer. So the purpose would be served by taking out the hyphen and replacing it by a comma. But just to be sure, I have worked out this proposal which I would be glad to submit:
-in the case of a municipal corporation to the mayor, warden, reeve or other chief officer of the municipality or to the secretary, treasurer or clerk of the corporation.
I shall ask my colleague, the Minister of Veterans Affairs if he will move that.


Julia Verlyn (Judy) LaMarsh: I just wonder whether the term "chief officer" means anything legally. Under Ontario legislation he is called the head of the corporation. I do not know what it might be called in other provincial legislation. "The chief officer" is a phrase with which I am not familiar in municipal law in any event.


Harold Edward Winch: Is "executive officer" any better.


Edmund Davie Fulton: I will ask my colleague the Minister of Veterans Affairs to move:
That clause 2 be amended by striking out lines 15 and 16 thereof and substituting the following:
(a) in the case of a municipal corporation to the mayor, warden, reeve or other chief officer of the municipality or to the secretary, treasurer or clerk of the corporation, and


Mr. Churchill:: I so move.


Edmund Davie Fulton: Could you substitute, there, Mr. Chairman, the word "corporation" for "municipality" so that it would read "other chief officer of the corporation".


Jacques Flynn: Very well. It reads, "or other chief officer of the corporation". Shall the amendment carry?
Financial Administration Act


Harold Edward Winch: Would not "executive officer be better than "chief officer"?


Edmund Davie Fulton: No. I think we came to the conclusion that some of them might be elected by the reeves of a township. They might meet together and elect one of their number as a head. He is called a warden. We were not sure that he would be called an executive officer. "Chief officer" seems to cover the situation and if it does not, if there is any uncertainty, then, surely, there will be a secretary, treasurer or clerk.


[Stage Direction]
Amendment agreed to.
Clause as amended agreed to.
Title agreed to.
Bill reported.
Mr. Deputy Speaker:: When shall the bill be read the third time?


Some hon. Members:: Now.


Harold Edward Winch: By leave, now.


Paul Joseph James Martin: Next sitting.



FINANCIAL ADMINISTRATION ACT


Gordon Minto Churchill: that the house go into committee to consider Bill No. C-109, to amend the Financial Administration Act.
Motion agreed to and the house went into committee, Mr. Flynn in the chair.
On clause 1-"Securities" defined.


Mr. McMillan:: In connection with clause 1, I think the parliamentary secretary was asked some questions the other day. In particular he was asked what some of the securities might be, and what would be the advantage to Canada to be able to buy all securities guaranteed by the government of Canada. It occurs to me that the only securities other than the Canadian bonds would be the C.N.R. bonds.
I should also like to know if "securities" could possibly mean a mortgage, because in the note of explanation it says "and any other security respecting part of the debt of Canada". I should like to know the advantage of buying these securities guaranteed by the government.


Richard Albert Bell: Mr. Chairman, the answer to the second question asked by the hon. gentleman is no, it could not include a mortgage. So far as I am aware the government of Canada has not engaged in that type of financing.
[The Chairman.]
The purpose of this particular clause is a rather simple one; it really is to remove an anomaly. The Minister of Finance is entitled to purchase, acquire and hold securities of Canada but not those guaranteed by Canada. This clause would permit him to purchase, acquire and hold the bonds to which the hon. member for Welland referred-* C.N.R. bonds-and to buy them at any time to support the market.


William Hector McMillan: Can that not be done by the minister through the Bank of Canada?


Richard Albert Bell: The Bank of Canada has powers under its own act. This clause relates only to the Financial Administration Act. Under this act there is a serious question as to whether the power exists.


[Stage Direction]
Clause agreed to.
On clause 2-Uncollectable debts.
Paul Joseph James Martin: I suppose this involves a practice which the government seeks to follow, one often followed in business, where there exists a whole series of accounts that are uncollectable. Is the parliamentary secretary in a position to give us a rough estimate of the number of these accounts and the total value which would come within the category of $1,000 or under?


Thomas Miller Bell: In respect to the first subclause, the change is solely to delete the existing time limitation. In respect to accounts under $500 there is now a time limitation of five years. In respect to accounts between $500 and $1,000 there is a time limitation of ten years. Those that exceed that are covered by an item in the supplementary estimates, as the hon. member for Essex East knows, passed at each session of parliament. The accounts exceeding $1,000, the deletion of which were authorized by the last final supplementary estimates under vote 654, amounted to $960,734, covering 238 items. The accounts which were covered by governor in council authority under the old act under $1,000 which were outstanding for ten years or more numbered 166 and totalled $116,559. Accounts under $500 which were outstanding for five years or more numbered 2,395 with a total value of $276,693.
Perhaps having placed that information on the record I should also deal with items which come under the subsequent subclause. Those are accounts under $25 each outstanding two years or more, numbering 5,028 with a total value of $40,119.


[Stage Direction]
Clause agreed to.
Clauses 3 and 4 agreed to.
[Stage Direction]
**

Financial Administration Act
On clause 5.
Harold Edward Winch: Further to the explanation as it appears in the bill itself, could the parliamentary secretary explain to me what is meant by the suggestion that this clause places the crown in the same position as a private individual.


Thomas Miller Bell: Basically that is the purpose, so that in the case of an assignment of a crown debt the individual will be in the same position as though there had been an assignment of an ordinary debt by a subject and, as will appear later in the following subsection, an assignment of a chose in action.
As I endeavoured to outline at the resolution stage, when the house was in the committee of the whole, the position which has traditionally been taken by the crown in the past is that the crown is not bound by an assignment of a debt owing by the crown to a subject. Over the years there has been developed a practice whereby the banks, and indeed other persons engaged in the business, have accepted from crown creditors powers of attorney. They arranged their affairs, in many cases, apparently on the basis that such powers of attorney operated essentially in the same way as assignments, although in fact they did not confer on the donee any rights, as against the crown, to be paid in place of the crown creditor at the resolution stage. I outlined the particular case in the exchequer court of the Bank of Nova Scotia in respect to an assignment made by Roy Swail Limited. This case was heard by the president of the exchequer court who decided that the crown was in the same position with respect to the assignment of a debt owing to it as was any subject, provided that the assignment was made in accordance with the laws of assignment of the province in which the assignment was made, and that adequate notice of such assignment was given to the crown.
The purpose of these amendments, which are encompassed by new section 88 with the various letters, is to provide a simple and adequate procedure for the subject so that it is possible to have an assignment proceed, as the president of the exchequer court did decide, and that there may be no prejudice either to the subject or to the crown. The effect of the amendment is to provide for the recognition of the assignment of crown debts arising under contract, but subject to certain rights and conditions which we will discuss later.
It is also proposed to include, as I indicated earlier, provisions whereby the governor in council may authorize the recognition and assignment of other choses in action, subject to the same rules and conditions.


Harold Edward Winch: Mr. Chairman, this is one occasion when I am sorry that I am not a lawyer. Do I understand from what the parliamentary secretary has said that in the assignment of a crown debt there is no differentiation between the crown and the private individual-that there is no superiority or seniority?


Thomas Miller Bell: Mr. Chairman, I think the hon. gentleman is confusing two things in relation to this. I think he is perhaps confusing priorities in bankruptcy with assignments. In the first case, although I speak subject to correction, I think the crown does exercise a priority. The question of priority as between the crown and the subject does not exist here. This involves the simple case where the crown owes a contractor some money and the contractor, in order to secure credit for some other purpose, assigns all his rights to that indebtedness from the crown to the bank. This assignment then puts the bank in the status of the original creditor of the crown.


William Hector McMillan: Mr. Chairman, why should people working for the crown have an advantage over others in that their salaries, wages and other moneys coming to them from the crown are not assignable?


Thomas Miller Bell: Mr. Chairman, I think this is a case of protection for civil servants. If such assignments were permitted, then we would have the prodigal sons and daughters who had gone out and assigned their emoluments from the crown hoping that the fatted calf would come home. Frequently, for those who have done so, the fatted calf never arrives. Therefore, this is, as I have said, a protection against that sort of foolishness.


William Hector McMillan: Mr. Chairman, in connection with section 88D-


Thomas Miller Bell: Did you say section 88D?


William Hector McMillan: Yes, I said section 88D.


Jacques Flynn: Section 88D is in clause 5.


Thomas Miller Bell: Overpayment comes under clause 6.


Jacques Flynn: I will call the sections of clause 5 one by one.
Clause 5, sections 88A to 88C inclusive agreed to.
On clause 5, section 88D-Notice of assignment.


William Hector McMillan: I wanted to know something about the amount of overpayments. I think this provision will facilitate collection by the
6578	HOUSE OF
Financial Administration Act comptroller, but has the parliamentary secretary any figures on the amount of overpayments?


Thomas Miller Bell: I think the hon. member is speaking about clause 6 of the bill, which deals with section 95 of the act, rather than section 88D. I will be glad to deal with that question when we come to clause 6.


William Hector McMillan: All right.
Clause 5, section 88D agreed to.
Clause 5, sections 88E and 88F agreed to.
On clause 6-Recovery.


Harold Edward Winch: Mr. Chairman, in the explanation that the parliamentary secretary said a moment ago he would give, will he go into some detail as to clause 6? I ask that question because both he and I are members of the public accounts committee. In that committee we have been dealing with the matter of overpayments and I cannot quite understand how this ties in and just what the exact implications are.


Richard Albert Bell: Mr. Chairman, this is designed to provide an efficient means to recover overpayments made from the consolidated revenue fund with respect to salaries, wages, pay and pay and allowances. The committee will note that by subsection 3 of section 36 of the act the comptroller is authorized to recover any accountable advance or any portion thereof which is not repaid or accounted for out of any moneys payable by Her Majesty to the person to whom the advance was made. It was felt desirable that the comptroller should have similar authority to make recovery for the overpayment of salary and wages.
To follow the procedure laid down in subsection 1 of section 95-I am speaking now of the present section and not of the amendment which is la-requires that the opinion of the Minister of Justice be obtained indicating that a debt exists and after such opinion is received the matter must be referred to the treasury board to obtain direction authorizing the set-off of this debt against any moneys payable by Her Majesty. The establishment of overpayment of salary or wages is a matter which I submit to the committee can be very readily determined and it appears unnecessary in such cases that the matter should be referred to the Minister of Justice and also to the treasury board before recovery of such overpayment is effected. Such recovery would not affect the legal remedies of any individual should there not in fact have been overpayment. I should like to emphasize that this preserves for the individual all the equities that may exist at the time the alleged overpayment is made.


Harold Edward Winch: Is this intended to cover the situation which was brought to our attention by the Auditor General where a person is fully employed in one department but is also working part-time for another and receives payment on that account?


Thomas Miller Bell: It would cover such a situation if in fact it were held that there was overpayment, but I think that the situations to which the hon member refers are situations where payment was made on the basis of an opinion given by the deputy attorney general of Canada and it would be difficult, of course, in the face of such an opinion, to assert that overpayment had been made. If, however, in fact and in law an overpayment has been made, this provision would then apply.


William Hector McMillan: Has the parliamentary secretary any estimate of the amount of overpayments?


Thomas Miller Bell: No, I do not have an estimate for the committee. I would not think that the amount was large. This is not a significant matter. I am told that the numbers might be fairly significant but the actual overall total would really be small.


William Hector McMillan: Would this apply to those receiving benefits under the Unemployment Insurance Act?


Thomas Miller Bell: No, this would not apply.


Paul Joseph James Martin: This only applies to those who are in the government service.


Thomas Miller Bell: That is correct.


Paul Joseph James Martin: It would not cover social welfare payments.


Thomas Miller Bell: No.


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


Some hon. Members:: Agreed.


Gordon Minto Churchill: the third reading of the bill.
Motion agreed to and bill read the third time and passed.



TRUST COMPANIES ACT


Gordon Minto Churchill: the second reading of Bill No. S-28, to amend the Trust Companies Act.


Richard Albert Bell: Mr. Speaker, this bill, together with its companion bill which follows immediately and deals with loan companies, parallels in large measure the amendments already made this session to the insurance acts, the Canadian and British Insurance Companies Act and the Foreign Insurance Companies Act. This bill revises and modernizes the powers of federally incorporated trust companies. I am in the hands of the house, sir, whether the bill should be referred to the standing committee on banking and commerce for further study or should proceed to the committee of the whole. Whatever the procedure may be, the house might wish to have a little background information about trust companies generally.
There are just over 50 trust companies operating in Canada at the present time. Ten were incorporated by or under the authority of this parliament and the remainder were incorporated provincially. Looking at the field of trust companies as a whole, the ten federally incorporated companies transact between one fifth and one quarter of the total business of all trust companies in Canada. These ten companies, whose names I shall mention, have capital and reserve funds approximating $40 million and administer trust funds totalling about $1,500 million.
The federally incorporated companies are these, and I will give after each the year of incorporation:
Year of
Name	Incorporation
The Canada Permanent Trust Company 1913
The Canada Trust Company	 1894
Chartered Trust Company	 1905
Commercial Trust Company Limited ..	1904
The Eastern Trust Company	 1893
Guaranty Trust Company of Canada ..	1925
Investors Trust Company	 1957
The Premier Trust Company	 1913
Prudential Trust Company Limited ..	1909
The Sterling Trusts Corporation	 1911
Originally, sir, the Trust Companies Act in Canada was enacted in 1914 and it applies to all federally incorporated trust companies but of course has no application to provincially incorporated companies. Consequently, the amendments to the act now proposed by Bill No. S-28 would apply only to the ten companies which I have mentioned and which are federally incorporated.


Paul Joseph James Martin: But not to a trust company which has been incorporated and is not now functioning, like the Standard Trust Company which was given a charter two years ago. I do not believe it is in operation. The amendments would not apply to that company?
Trust Companies Act


Richard Albert Bell: My recollection does not extend, as the hon. gentleman's does, to the Standard Trust Company. This bill would apply to all trust companies federally incorporated.


Paul Joseph James Martin: To all?


Richard Albert Bell: To all.


Paul Joseph James Martin: Not only to the ten; that is the point.


Richard Albert Bell: If there are others not within my knowledge at the present time, then this bill would have such application.
Since 1914, the federally incorporated companies have been required to file financial statements annually with the Minister of Finance, but there was no provision for licensing or regular inspection or supervision until 1920. Since that year, federal trust companies have been required to operate under a licence from the minister of finance and under the provisions of the department of insurance, under its distinguished deputy head, Mr. Kenneth R. MacGregor.
The investment and lending powers of federal trust companies are specified, as I have indicated, in the Trust Companies Act. It has been the custom of parliament to keep these powers consistent with the corresponding powers of insurance companies, except in so far as differences may be necessary by reason of the special characteristics of trust companies. In view of the amendments recently made to the insurance act, it is now proposed to make similar amendments to the investment and lending powers of trust companies to the extent deemed appropriate. In addition, a few other amendments are proposed, either for clarification or to enable the companies to meet changing conditions. With respect to those, I shall deal in some detail.
Perhaps for clarification of my subsequent remarks, it might be mentioned that the assets of trust companies are divided into three categories as follows:	First, unguaranteed trust funds. These are the funds accepted by the company in trust to be administered in accordance with the terms of the trust but carrying no guarantee of security of principal or of interest yield. Then, second, there are the guaranteed trust funds, those funds accepted by the company in trust where the company guarantees the security of the principal and sometimes the interest yield. They consist mainly of deposits made by the public in individual deposit accounts and of funds realized from the sale of guaranteed investment certificates. Third, and finally, there are the company funds. These are funds

Trust Companies Act
owned by the shareholders themselves, and they consist principally of the capital, surplus and reserves of the company.
The Trust Companies Act deals separately with the investment and lending powers applicable to each category. Such powers relating to trust funds are found in section 64 and those relating to company funds are found in section 68 to which reference is made in Bill No. S-28.
I should like to outline the more important and detailed amendments proposed in respect of investments and loans, all of such amendments relating to trust funds being found in clause 1 of the bill and those relating to the company's own funds being found in clause 2.
First, may I deal with the limits on mortgage loans. Hon. members are familiar with this situation in view of what transpired recently in connection with insurance companies. At present, companies may invest in and lend on the security of mortgages on real estate but the amount so invested or loaned in any particular case must not exceed 60 per cent of the value of the real estate. What is proposed by this bill is to raise this limit from 60 per cent to 66| per cent. This change would apply to all three categories of funds which I have mentioned and is parallel to the change recently made in respect of insurance companies.
Hon. gentlemen, as they review the bill, may see what appears to be duplication or repetition in the bill. This is attributable to the separate identification of investment powers and lending powers and also to the three separate categories in which the funds of trust companies are divided.
Then, may I outline the second category, real estate for the production of income. Companies may now invest a limited amount of guaranteed trust funds and company funds in real estate for the production of income, either alone or jointly with any other federal trust company or loan company, where the real estate is leased to a corporation having a dividend record meeting the prescribed standard of the act. The maximum amount that may be so invested in any one parcel of real estate is one half of 1 per cent of the aggregate of the book value of the guaranteed trust funds and the company's own funds. It is proposed to raise this limit from one half of 1 per cent to 1 per cent. It is proposed also to permit a company to join with any trust company, loan company or insurance company incorporated in Canada in making such investments. These changes are parallel to changes recently made for insurance companies.
Hon. gentlemen who sat in the banking and commerce committee when considering the insurance bills will remember the discussion

there which related to equipment trust certificates. There is a similar provision in this bill. Companies may now invest guaranteed trust funds and company funds in equipment trust certificates issued for the purchase of railway transportation equipment. It is proposed, under this bill, to expand this class to include transportation equipment for use on public highways. As I have said, this parallels a change which was made in respect of insurance companies.
Then, fourth, I would deal with investments and loans which are not specifically authorized under the act. It is proposed that companies be permitted, with respect to company funds only, to make investments and loans not otherwise authorized by the act, subject to a maximum limit on the amount of funds that may be so applied. This would grant to such companies a rather small area of freedom of investment of their own funds similar to that which is now available to insurance companies. The proposed limit on the amount that may be so invested and loaned is 15 per cent of the company's unimpaired paid up capital and reserve. This limit is the same as is prescribed in the loan and trust corporations act of Ontario in similar circumstances, and there are advantages in having the same limit apply to federally incorporated companies.
For a company having the maximum capital and reserve permitted by the act in relation to its guaranteed trust funds, this limit would represent a little over 1 per cent of all the company funds and guaranteed trust funds. This may be compared with a limit of 5 per cent of the assets now permitted for insurance companies. Hon. members may wonder why the difference between 5 per cent for insurance companies and 1 per cent for trust companies. The lower limit for trust companies is considered appropriate, at least until some experience develops with the use of this area of freedom of investment. It is not proposed that such area of freedom would extend in any way the company's power to invest in mortgages or hypothecs on real estate, to invest in real estate or to lend on the security of real estate.


Paul Joseph James Martin: In what clause of the bill is that covered?


Richard Albert Bell: I believe the particular provision is contained in clause 2, subclause 4.
Then I deal with the limit on investment in common stock. Companies may now invest guaranteed trust funds and company funds in preferred stocks or common stocks of Canadian corporations where the dividend record of the issuing corporation meets a specified

standard set in the act. As respects guaranteed trust funds, not more than 15 per cent of the book value may be invested in common stocks and not more than 25 per cent may be invested in, or loaned on the security of, stocks of all kinds, whether common or preferred. As respects company funds, not more than 15 per cent of the book value may be invested in common stocks and the total invested in, or loaned on the security of, stocks of all kinds, whether common or preferred, may not exceed 25 per cent of the company's unimpaired paid up capital and reserve.
The companies have requested an increase in the existing limits on investments in common stocks. Since at the present time, companies have virtually none of their guaranteed trust funds invested in stocks, it is not proposed to raise the limit applicable to those funds. As respects company funds, however, several companies are near the limit and it is proposed to remove the 15 per cent limit on common stocks in that connection but to retain the limit of 25 per cent of unimpaired paid up capital and reserve as the limit on investments in and loans on the security of stocks of all kinds. So in order to maintain consistency with the insurance companies and the loan companies, it is proposed that the amount of the company's own funds invested in common stocks when added to the amount of guaranteed trust funds invested in common stocks shall not exceed 15 per cent of the total of such funds. The effect of this change would be to permit an increase in investments in common stocks with respect to company funds where a company has not used its full powers in guaranteed trust funds and provided that less than 10 per cent of company funds have been invested in preferred stocks.
This is a detailing of the significant changes which are in themselves rather detailed and complex in so far as they affect the investment and lending powers of the companies.
I should like to take just a moment or two in which to deal with two other matters. First, I should like to deal with the power of a federally incorporated trust company to purchase the assets and business of another trust company, whether the latter be a federally incorporated or a provincially incorporated company. Certain of the proposed amendments in this respect are to be found in clause 3 of the bill.
The act at present permits a company to buy 67 per cent or more of the stock of another trust company, subject to approval by the treasury board, where the purchase is made as a prelude to the eventual taking over of the assets and business of the purchased company. The act specifies that at least 67 90205-6-415
Trust Companies Act
per cent of the stock of the company to be taken over must be purchased at the outset but it does not clearly specify that in any offer to purchase, the same offer must be extended to all shareholders of the company being purchased. It is proposed to include such a requirement in section 79 in order to prevent discrimination against minority shareholders.
Another amendment to this section would authorize the purchasing company to have a larger board of directors, temporarily, following acquisition of the stock of the other company, than is ordinarily permitted by section 15 which places the maximum number at 30. The temporarily enlarged board could not, however, in any case exceed the aggregate number of directors of both companies at the time of purchase. This amendment is for the purpose of enabling the directors of the other company to become directors of the purchasing company, thus retaining the value of their goodwill, service and connections for the benefit of the purchasing company.
I said earlier there were two things which I wanted to mention. I should have said three. The third and final is the fact that it is considered desirable to include in the act provisions whereby federal trust companies might amalgamate as an alternative to merging by the purchase and sale of assets and business. Federal trust companies have had the power to merge by the purchase and sale of assets and business ever since the Trust Companies Act was enacted in 1914 but they do not at present possess the power to achieve the same end by amalgamation, notwithstanding the advantages of the latter course in some circumstances. For many years the chartered banks similarly enjoyed the power to merge by purchase and sale but they lacked the power to amalgamate until granted such power on revision of the Bank Act in 1954. Canadian insurance companies, on the other hand, have possessed the power to follow this course since 1910. Many provincially incorporated trust companies likewise have had the power for many years to amalgamate under the applicable provincial statutes, thus leaving federally incorporated trust companies at a disadvantage in this respect. Hon. gentlemen will observe that clause 4 of the bill, which would enact a new section 80A, has been designed at the request of federal trust companies to fill this gap and put them in the same position as most other kinds of companies. It might be noted that this clause makes provision for the amalgamation of one federally incorporated trust company with another federally incorporated trust company but makes no provision for the

Trust Companies Act
amalgamation of a federally incorporated trust company with a provincially incorporated trust company or with any other kind of company.


Paul Joseph James Martin: We have no power.


Richard Albert Bell: We have no power. As I have indicated, the bill contains only 4 clauses and these are the significant amendments. There are a few other points of a technical nature which might be dealt with in the committee. As I indicated to the house this is the type of bill which generally is referred to the standing committee on banking and commerce where there is an opportunity of hearing testimony of the distinguished deputy head, namely the superintendent of insurance. There is opportunity also of the hon. gentleman from Greenwood being present. That hon. gentleman in other days was just as distinguished in the trust company field as he is today as a member of this House of Commons.


William Hector McMillan: I was just going to say, Mr. Speaker, that many of the provisions of this bill are very technical in nature, and I think we should have the advantage in the banking and commerce committee of hearing the officials from the department of insurance. When this bill was brought up for consideration in the other place I believe it was referred to their banking and commerce committee and that they had the officials appear before that committee.


Richard Albert Bell: That is right.


William Hector McMillan: I think it would be well if we followed the same procedure.


Harold Edward Winch: Mr. Speaker, I was most happy to hear the parliamentary secretary to the Minister of Finance conclude his remarks in the same way as he opened them, namely by saying that it was up to the committee whether or not this bill No. S-28 went before the standing committee of the House of Commons on banking and commerce. I think perhaps the best argument as to why it should do so was the lengthy, detailed and technical speech made by the parliamentary secretary to the Minister of Finance. He made it quite obvious that it should be done. May I just say this having looked at the bill, namely Bill No. S-28. First of all I would ask the house to remember the remarks of the previous speaker who said that this bill does not concern one trust company only; it concerns all trust companies. I would ask hon. members to take a look at the principle of the bill. We find first in the explanatory notes:

The main purpose of this bill is to make certain changes in the investment powers of trust companies incorporated by parliament.
Right there is something of a most serious nature. If, understanding the principle of the bill, we look through all the clauses we find on page 3 the provision to enable a company to lend unguaranteed trust money on the security of real estate in amounts up to two thirds of the value of the real estate instead of 60 per cent as at the present.
We find that this bill will enable a company to invest its own funds in mortgages on real estate up to a maximum of two thirds of the value of the real estate instead of 60 per cent. Still dealing with the principle of the bill, lower down on page 3 we find an amendment which would enable a company to lend its own funds on the security of real estate in amounts up to two thirds of the value of the real estate instead of 60 per cent as at present.
What is the final principle of this bill? There is a brand new clause. It is a clause intended to grant trust companies the power to amalgamate and prescribe the procedure to be followed. Just taking the word of the parliamentary secretary to the Minister of Finance whose language was so technical and so difficult, I am sure the house will agree, as I do, with the hon. member for Welland (Mr. McMillan), that a bill of this importance, affecting every trust company incorporated by the parliament of Canada, is one which most certainly should be referred to the standing committee on banking and commerce. I hope the hon. member will so move on second reading.


Paul Joseph James Martin: Mr. Speaker, I want to say a few words on this subject. I am sure we are very grateful to the parliamentary secretary for the explanation he has given with regard1 to a bill the details of which are such as to defy ready appreciation unless there is an opportunity for pretty close interrogation of the superintendent, which we could undertake if he were to appear before the banking and commerce committee. However, it will not be possible there, I take it, to receive any statement of policy. We will receive an explanation of the bill, or an explanation of what has already gone on.
I wonder whether the parliamentary secretary is in a position to give the house the government's thinking with regard to matters having to do with large corporations, which I think perform a very useful service in our society; I refer to insurance companies, trust companies, banks and the like. I have particular reference to the tendency during recent days for large mergers and large amalgamations.

We have seen this in the case of the banks, which of course are not covered by this bill. We have seen it, of course, in the case of trust companies. All of this raises in one's mind the question of whether or not this is a good thing for the country and whether it is a development which ought to be fully explained so that we will know what are the consequences of this tendency.
I raise this question because I think it is in the minds of many people. Certainly this is true as a result of some of the big bank mergers, and recently some very important trust companies have added to their holdings by amalgamation and other processes. I believe there are now before us considerations concerning an amalgamation or some sort of integration between two of the larger trust companies in the country.
I mention this matter because I think this would be an appropriate time for a statement by the government of its opinion with regard to these developments. The bill, of course, does not deal with the question of purchase of trust companies by foreign corporations. I understood the parliamentary secretary to the minister to say a few moments ago that in the case of the amalgamation of trust companies, treasury board has the power under sections of the act which are not in the bill before us to approve such amalgamations.
In the case of the purchase, for instance, of an insurance company or the acquiring of control of an insurance company by foreign investors or foreign corporations, whatever may be the persuasive influence exercised by the Minister of Finance (Mr. Fleming), his authority is not more than a persuasive one; I do not believe he has any power to prevent it.


Thomas Miller Bell: The hon. gentleman, of course, is aware of the amendments to the insurance acts which this government introduced in 1957?


Paul Joseph James Martin: I was not aware of them. I am aware of them now my hon. friend recalls them to my mind.


Richard Albert Bell: They are of great significance in relation to federally incorporated insurance companies.


Paul Joseph James Martin: That did not have the effect, for instance, of stopping the recent taking over by a United States corporation of a Canadian insurance company.


Richard Albert Bell: I think that must be the insurance company with which my hon. friend's friend was involved, which company is provincially incorporated.
90205-6-415J
Trust Companies Act


Paul Joseph James Martin: I hope my hon. friend is not stooping to political considerations when he says "my friend". I presume that when he says "my friend" he simply means someone who, happily for him, shares my political views. In the case of trust companies, what is the situation? Is it open to any foreign corporation or any group of foreign investors to acquire a dominant interest in a Canadian trust company? If that is the practice, is it thought to be a good practice? I am not saying it is not; I am just looking for the kind of information which I think the public expect us to elicit and which we may not be able to get in the banking and commerce committee unless there is a spokesman there for the ministry itself. These are questions which in the light of recent events I think deserve comment by the parliamentary secretary.


Mr. Speaker:: I must inform the house that if the parliamentary secretary speaks now he will close the debate.


Richard Albert Bell: Mr. Speaker, there are two points with which I wish to deal. It is quite obvious from the attitude of the house that it is the wish that this bill should be referred, as is generally the practice, to the standing committee on banking and commerce, and after second reading I will ask the house leader to so move.
The hon. gentleman from Essex East has raised a matter which might be the subject of perhaps both philosophical and political argument; that is the tendency which does exist in companies, not only Canadian companies but companies throughout the western world to grow bigger, to amalgamate. I would not wish to make any statement of policy in relation to that matter. I do not think that bigness as such is necessarily an evil. I do believe, however, that each case where there is a request for amalgamation ought to be reviewed upon its merits and ought to be decided on the basis of one thing only, and that is whether the public good will be upheld. Bigness in some things may advance the public interest. Bigness in other circumstances may very well result in combines in circumstances which would be against the public good. However, I would certainly not wish to suggest that amalgamation as such is evil.
The hon. gentleman also asked about the freedom of any foreign corporation to acquire federally incorporated Canadian trust companies. This is a matter which I think might be pursued in detail with the superintendent of insurance before the standing committee on banking and commerce. The hon. gentleman raised the question of the insurance

Loan Companies Act
companies. Decisive action was taken in the session of 1957 in respect of federally incorporated companies which has had a most salutary effect. Personally I would hope that provincial legislatures would adopt the principles which the federal parliament then adopted.


Paul Joseph James Martin: The parliamentary secretary said that when this bill is discussed before the committee we could pursue the question of the purchase of Canadian trust companies by foreign investors or foreign corporations. But this possibly involves a matter of policy. What is the policy with regard to such attempts by foreign corporations to take over Canadian trust companies? Is there anything in the law now similar to the act of 1957? Are there any restrictions whatsoever?


Richard Albert Bell: I am personally not aware of any provisions in the Trust Companies Act as it now exists, but the hon. gentleman is, I am sure, in no doubt as to the general policy of this government in its endeavours to Canadianize as far as possible.


Paul Joseph James Martin: I have not had an answer to my question, but I shall not pursue the matter.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on banking and commerce.


Gordon Minto Churchill: the second reading of Bill No. S-29, to amend the Loan Companies Act.


Richard Albert Bell: As I indicated when I spoke on the earlier bill, this is a companion measure. It applies the same principles generally as those I had already outlined. In view of the obvious wish of the house that the previous bill should be referred to the standing committee on banking and commerce, I shall ask
the leader of the house after the second reading of this bill to move that it also be referred to the standing committee.
The house may wish to have a general statement with respect to loan companies. The Loan Companies Act which this bill amends was enacted in 1914 at the same time as the Trust Companies Act. These two acts are in the same general form and contain many identical provisions. They differ only to the extent necessary to recognize differences in the nature of their businesses. In the past, whenever amendments have been made in one act it has always been the policy to make similar amendments to the other.
I think the house would wish me to distinguish between loan companies and small loans companies. It might be mentioned that the essential characteristics of a loan company under the Loan Companies Act is the power to make loans on the security of real property and absence of the power to make loans secured by personal property. On the other hand, the distinguishing characteristics of a small loans company under the Small Loans Act is the power to make loans on personal security and absence of the power to make loans on real property.
The Loan Companies Act applies to all federally incorporated loan companies, of which there are only five at the present time. It has no application to provincially incorporated loan companies numbering about 24.


Paul Joseph James Martin: Would a finance company be included among small loans companies?


Richard Albert Bell: I should not like to answer the hon. gentleman specifically in relation to that. There are many finance companies which are not small loans companies. We are in a very technical field.
The five federally incorporated companies have assets amounting to about $440 million and transact about twice the volume of business done by provincial companies. The companies to which I am referring are as follows. I shall give the date of the incorporation and the location of the head office in each case:
Name	Year of
incorporation
Canada Permanent Mortgage Corporation	 1899
The Eastern Canada Savings and Loan Company	 1887
Gillespie Mortgage Corporation		 1955
The Huron and Erie Mortgage	Corporation	 1864
International Savings and Mortgage Corporation
(formerly International Loan	Company)	 1920
Location of head office Toronto Halifax Vancouver London
Winnipeg


Paul Joseph James Martin: Are not some of those concerns trust companies?


Thomas Miller Bell: No. These are all loan
companies.


Paul Joseph James Martin: I thought the first one was.


Thomas Miller Bell: No. The Canada Permanent Mortgage Corporation is the parent company of the Canada Permanent Trust Company. I believe that The Huron and Erie Mortgage Corporation owns a subsidiary, the Canada Trust Company. My hon. friends who have dealt with these matters in their law practices in central and western Ontario have greater familiarity than I have with these firms.
Since most of the proposed amendments to the Loan Companies Act are similar to those already described in reference to Bill No. S-28 to amend the Trust Companies Act, it seems unnecessary to repeat the same explanations in reference to Bill No. S-29. Clauses 2, 4, 5 and 6 of Bill No. S-29 are the counterparts of clauses 1, 2, 3 and 4 of Bill No. S-28. Clauses 1 and 3 of Bill No. S-29 are additional proposed amendments respecting the Loan Companies Act and have no counterpart in the bill which has just received second reading.
Clause 1 of this bill extends the definition of a loan company so that the Loan Companies Act will clearly apply to companies which confine their business to the purchase of mortgage loans on real estate as well as to companies that make such loans directly.
Clause 3 relates to section 61 of the act and applies to only two loan companies, each of which owns all of the shares, other than directors' qualifying shares, of a subsidiary trust company. Hon. gentlemen have already referred to those particular trust companies, the Canada Permanent Mortgage Corporation, which owns the Canada Permanent Trust Company, and the Huron and Erie Mortgage Corporation, which owns the Canada Trust Company.
Where a loan company on June 28, 1922 owned 50 per cent or more of the shares of a trust company, the act permits the continued holding of such shares notwithstanding that the holding of common shares of any corporation is otherwise limited to a maximum of 30 per cent of the issued shares of such corporation. The act also permits the loan company to invest in the whole or any portion of additional shares that may be issued by the trust company. It does not, however, permit the loan company to acquire additional shares from other shareholders. The proposed amendment would grant this further power.
19,	1961
Government Property Traffic Act and, as I have indicated, the proposal will be to refer it to the standing committee on banking and commerce.


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


Harold Edward Winch: I should like to ask the parliamentary secretary a question. He says that the principles here are the same as apply to the previous bill. Why should a loan company which is a subsidiary of a trust company- there are two cases here-have the same rights as a trust company?


Thomas Miller Bell: I am not sure I understood the hon. gentleman's question. Did he ask me whether a loan company which is a subsidiary of a trust company has the same rights as the trust company?


Harold Edward Winch: Yes.


Thomas Miller Bell: I think if the hon. gentleman had followed me he would realize that exactly the reverse situation with respect to parents and subsidiaries is the case. The Canada Permanent Mortgage Company owns the Canada Permanent Trust Company; the Huron and Erie Mortgage Company owns the Canada Trust Company. But in each case the respective powers of the parent and subsidiary are covered by the respective acts; the parent by the Loan Companies Act, with which we are now dealing, and the subsidiary by the Trust Companies Act, to which we have just given second reading.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on banking and commerce.


Hon. D. J. Walker (Minister of Public Works) moved: the second reading of Bill No. S-24, to amend the Government Property Traffic Act.
He said: Mr. Speaker, the amendments to the Government Property Traffic Act are required in order to bring this act up to date with the penalties of the highway traffic act and also the Criminal Code. Hon. members will note that there really are only three changes, two of them substantive.
Subclause (g) provides for a maximum fine of $500 in substitution of the old maximum of $50. Also provided, as will be noted in the second line of that subclause, is imprisonment for a term of six months, as the maximum imprisonment. In the third line appears the insertion of the word "such" between the words

Government Property Traffic Act "or" and "fine", so as to make it quite clear that this refers to the preceding clause.
There has been an addition in the fifth line following the word "regulation" of the words:
-except that for the violation of any regulation governing the parking of vehicles the penalty prescribed shall be a fine not exceeding fifty dollars.
Subclause (h) is added reading as follows:
providing for the voluntary payment of fines and for prohibiting persons who have violated any regulation from driving a vehicle on such lands for any period not exceeding one year.
These amendments are long since overdue. The Government Property Traffic Act was passed in 1952. Since that time penalties provided for similar offences under the other acts have become much more severe, such as that provided by section 694 of the Criminal Code as found in chapter 51 of the Revised Statutes of Canada, 1953-54.


Harold Edward Winch: Mr. Speaker, I presume that following second reading of this bill it will be referred to committee of the whole. If that is the case I should certainly like the minister to give us some clear explanation as to what is concerned in these amendments. There is an increase in the penalty from $50 to $500. What type of violation would necessitate an increase in the penalty from $50 to $500?
I do not intend to deal with the section governing parking, but I feel we are entitled to know what the offences are in respect to House of Commons property which necessitate a maximum fine of $500, and sincerely hope that the minister will explain this to the committee.


Mr. Speaker:: The hon. member will have the opportunity of inquiring into the details at the committee stage. Is the house ready for the question?


Some hon. Members:: Question.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Flynn in the chair.
On clause 1.
Harold Edward Winch: Mr. Chairman, I understood the minister intended to explain that to which I made reference a moment ago. Perhaps he will also explain whether the grounds of the House of Commons are completely within the jurisdiction of the House of Commons and, therefore, in order to change the penalty there must be an amendment passed by parliament. I should like the minister also to explain exactly how charges are laid under this act, before which judge the trial is heard, and to whom the fine is paid.


David James Walker: Mr. Chairman, I will be very happy to answer the hon. gentleman. This act

does not apply solely to the grounds of the House of Commons but to any federal government property in Canada.


Harold Edward Winch: Do I understand by that statement that a specific amendment to an act is required in regard to government property anywhere in Canada?


David James Walker: No, just in respect to federal government property.
Prosecutions under this act take place in the regular way before the regular constituted courts in each of the provinces. The necessity for this act results from the fact that provincial acts do not cover the federal property involved.
The purpose of this amendment is to bring the federal regulations in line with other regulations. The hon. member has asked what violations are covered by this act. As an example, I should like to suggest that an individual speeding in federal government property can be charged under this act. If the maximum fine is $50 hon. members will appreciate that there is not much deterrent to individuals who repeatedly violate the regulations. Over the past number of years provincial statutes have been increased in respect of fine to a maximum I believe of $500.


Paul Joseph James Martin: Is the minister stating that the fines as covered by this amendment are consistent with those in other highway and traffic acts?


David James Walker: I thank the hon. member for Essex East for asking that question. The fines covered by this amendment are consistent with the fines imposed under provincial highway traffic acts, in respect to similar offences. The purpose of these amendments is to bring this act in respect to fines and imprisonment into conformity with other acts.


Paul Joseph James Martin: Do the provisions of this act apply in respect to property owned by the municipalities but maintained by the federal government, such as federal parks and highways?


David James Walker: I should also like to thank the hon. member for asking that question.
There was perhaps some concern as to whether the national capital commission would be covered by this act. In that connection I should like to state that the national capital commission has its own act and regulations.


Jean-Paul Deschatelets: Mr. Chairman, subparagraph (g) provides for a fine not exceeding $500 or a term of imprisonment not exceeding six months for violation of regulations, except

in respect to parking. What are these regulations? The minister spoke a few moments ago about the speed of traffic. What kind of regulations are they? I understand that speed can be covered, but are there any other regulations?


David James Walker: Everything connected with traffic violations is covered including parking, careless driving and so on. The maximum fine for parking, of course, is specifically set out in this amendment as not exceeding $50, and again that is commensurate with the provincial acts. The regulations are rather long. They are set out in the consolidation of statutory orders and regulations, 1955, and if the hon. member would like to see them at any time they are readily available.


Paul Joseph James Martin: Does the provision in (h) correspond with any provincial act or regulation?


Harold Edward Winch: That is the very point I am after.


David James Walker: Just a moment. I am answering the hon. member for Essex East.


Harold Edward Winch: He did not stand up so I did not think he was asking a question.


David James Walker: He stands up. I have not noticed him refusing to stand up. Paragraph (h) is a new provision. If the charge is careless driving or speeding or illegal parking, instead of the person being forced to take time off to come to court and plead guilty or not guilty he has the option under paragraph (h) of voluntarily paying the fine and not standing trial provided he wishes to plead guilty. That is often done. The hon. member for Vancouver East has perhaps had no experience himself but some of us have had the experience of being able to pay the fine into court under some of the regulations, and this is just bringing the situation in conformity with the other acts.


Harold Edward Winch: I am not concerned about that but rather with the general principle. According to what the minister has said, this provision applies to any federal property in Canada. Is there something in the original act that says the law in the various provinces for the offence shall apply? You certainly cannot take that meaning from this. All the minister has spoken about is parking and I cannot see a fine of $500 for parking. I am a little confused as to what the first clause means.


David James Walker: Subsection 1 of section 2 of the act, which is to be found in chapter 324, Revised Statutes of Canada, 1952, volume V, page 5775, provides as follows:
The governor in council may make regulations for the control of traffic upon any lands belonging
Government Property Traffic Act to or occupied by Her Majesty in right of Canada, and in particular, but without restricting the generality of the foregoing, may make regulations
(a)	regulating the speed and parking of vehicles and prescribing routes of travel;
(b)	respecting one-way traffic, obstruction of traffic, and pedestrian traffic;
(c)	for directing traffic and erecting signs;
(d)	prohibiting traffic by such vehicles at such times, in such places and in such circumstances as may be prescribed in the regulations...


Harold Edward Winch: Where do you find anything there which gives you the authority to bring in the amendment before us now providing that there shall be a fine of $500?


David James Walker: That is in paragraph (g) of subsection 1 of section 2 of the same act. Having set out the preliminaries involving what the government can regulate, it goes on to prescribe a fine not exceeding $50 or a term of imprisonment not exceeding two months, or both fine and a term of imprisonment, to be imposed upon summary conviction as a penalty for violation of any regulation. In other words, first the government has the power to prescribe regulations for speeding, parking and other infractions of vehicular traffic and, second, it is provided that these offences shall be treated as summary offences and be punishable with a maximum fine of $50 or a term of imprisonment not exceeding two months or a combination of both.
In answer to the hon. member for Essex East, may I say that all we are seeking to do tonight is to substitute for the maximum fine of $50 and maximum imprisonment of two months a maximum fine of $500 and maximum imprisonment of six months. It has been found that the deterrent effect of a $50 fine is not sufficient to keep people within the law and accordingly we are bringing our act up to date and in line with the other acts. Otherwise it would seem to be inequitable that on federal government property the penalty should be less than elsewhere. I would ask the hon. member not to think particularly of parliament hill but to think of government property anywhere in Canada.


Harold Edward Winch: I am glad to do that, but will the minister tell me of any provincial law with respect to speeding or parking where such penalties are provided? Such penalties may be provided for dangerous driving or impaired driving, but the minister has only mentioned parking and speeding. Can the minister tell me of any place where the fine for speeding or parking is over $50? It is true that it is for dangerous driving, impaired driving or intoxicated driving.


David James Walker: The provincial highway traffic acts include the offences which the hon. member has mentioned-



B588 HOUSE OF

[Stage Direction]
Government Property Traffic Act
Harold Edward Winch: Dangerous driving, impaired driving or intoxicated driving.


David James Walker: They are separate. This provision does not go that far. I am talking about summary convictions with respect to speeding, parking, careless driving and so on. Under the provincial acts they are punishable in accordance with section 694 of the Criminal Code which provides the penalties for summary convictions. Section 694 provides as follows:
... every one who is convicted of an offence punishable on sumary conviction is liable to a fine of not more than five hundred dollars or to imprisonment for six months or to both.
If the hon. member for Vancouver East will follow me, all we are seeking to do with respect to the act we are amending tonight is to bring it up to date and in line with the penalties prescribed in the Criminal Code for summary convictions. Each of the provinces has its own list of summary convictions and the punishment meted out on summary conviction is provided by the Criminal Code.


Mr. Godin:: Mr. Chairman, as this legislation has been in existence for some time it would seem that it has a very good purpose in that the crown in the right of the Dominion of Canada owns large tracts of land. Many areas come to mind such as that at Petawawa. People have occasions to travel over portions of the property there every day and therefore there must be a way of enforcing traffic laws similar to those contained in the traffic acts of the various provinces. I have not had occasion to read the numerous sections of the regulations which, if the volume that the minister held in his hand a moment ago is any indication, are rather numerous, but it seems to me that reference should be made to the travelled portions of these lands if the regulations pertain to traffic. In other words, these provisions would make very little sense if the crimes could be punishable when committed on other than a highway. Under most provincial highway acts, if the same crime were committed in a private driveway or on a person's farm, a person could not be convicted. No doubt the intention of this legislation is to make sure that the same exemption is preserved in so far as these large tracts of land are concerned which the crown owns.
If this bill relates to traffic offences, it seems to me the wording should be such as to limit the offence to the travelled portion of the property. If a person drove negligently on a portion of government property other than the travelled portion and thereby caused damage to another vehicle, there could be confusion as to the laying of a charge. The amending bill before us indicates that most of the provincial highways traffic acts impose


rather severe penalties for certain infractions, including the cancellation of the licence. However, if the same offence were committed on crown lands, apparently the most severe penalty would be the revocation of the right to drive on crown property.
If someone visiting Petawawa committed a traffic offence, and there are many miles of road in Petawawa, the only penalty imposed would be a revocation of the right to drive in Petawawa. I think that this amending bill fails to impose any measure of severity because the penalty is restricted to depriving a man of the right to drive on crown property. Subclause (h) says that he shall be deprived of the right to drive a vehicle on such lands for any period not exceeding one year. If it is the intention of this amending bill to bring the penalties into line with the penalties imposed by provincial highway traffic acts, it seems to me that it fails because a person may commit a very grave offence while visiting government property for the first and last time, and therefore the judge has no power beyond depriving him of his right to drive on that portion of federal property. These are the two things that occurred to me as needing explanation.


David James Walker: This is a very interesting point that the hon. member for Nickel Belt raises. Since he is an able lawyer himself, I know he will appreciate that $500 seems like a substantial fine. However, it can be as small as the magistrate wants to impose. When you get up to $500, it is generally for repeated offences, and that is the reason the fine has been raised as high as it has.
Of course my hon. friend will appreciate that while on government property, outside of those regulations as to speeding and parking, the provision of section 6 of the traffic regulations would apply. This section reads, in part:
No person shall operate a vehicle on a highway otherwise than in accordance with the laws of the province and the municipality in which the highway is situated.
We have here a situation where our own particular act which we are amending covers certain offences, and anything that is not covered by that act is covered by the law of the province or municipality in which the offence takes place.


Osias.-J. Godin: I realize the minister intended to give an explanation, but my suggestion is that there seems to be an inequality. If a person commits a traffic offence on Wellington street, he may be fined $400 by the magistrate. If a person commits the very same offence on crown property, he is tried by the same magistrate and may be fined $400. There is equality here. However, if the

magistrate decided to cancel the licence of that driver in addition, the man who committed the offence on Wellington street may very well have his licence suspended for six months and he would be prevented from driving any place in the province of Ontario, whereas the person who committed the same offence on crown land would only lose the right to drive on those crown lands.


David James Walker: As my friend will appreciate, we are confined to federal lands. We cannot take upon ourselves any jurisdiction for Wellington street. I quite appreciate the point the hon. member is raising.


Jean-Paul Deschatelets: There is a legal saying that nobody should be ignorant of the law. This is a special act covering infractions on federal government property. I would think that something should be done to make people aware of the fact they are on federal property. Some signs should be posted to show that people are liable to prosecution, for speeding infractions, careless driving, and so on. Otherwise, there may be people who would be completely ignorant of the fact that they are liable to prosecution for these offences on federal property.


David James Walker: I am glad my hon. friend raised that point. Section 7 of the traffic regulations states:
The Minister of Public Works, the minister of any department having the control or management of any government property or the commissioner may mark or erect or cause to be marked or erected on any government property, traffic signs or devices
(a)	prescribing rate of speed;
(b)	regulating or prohibiting parking and designating parking areas;
(c)	prescribing load limits for any vehicle or class of vehicles;
(d)	prohibiting or regulating the use of any highway by any vehicle or class of vehicles;
(e)	designating any highway as a one-way highway;
And so on.


Harold Edward Winch: May I ask the minister, while he has that book before him, what the situation now is on the hill, as we call it. On the hill, only the Royal Canadian Mounted Police have any control whatever. The other night when I was in a taxi, a chap was coming up in front of the parliament buildings at 40 or 50 miles an hour and almost hit us. If the mounted police had caught him and charged him, I presume he would have been tried by a municipal judge. Since he would have been arrested on the hill by the mounted police, would the law of the province of Ontario apply when that man appeared in court?


David James Walker: No. When he is charged by the R.C.M.P. officer, the matter is taken before a magistrate and an information is 90205-6-416
19. 1961
Government Property Traffic Act laid. He is tried in the regular court by a magistrate the same as any other citizen who breaches the law on Wellington street. Then, the magistrate has cognizance of this particular act which we are amending tonight. That is why it has been a bit old fashioned and behind the times in providing such low penalties when one compares it with the law which would appertain to Wellington street. In the case which my hon. friend recited of the other night when he was almost run into by a car driving 40 miles an hour, which we so often see come rushing up to the main door, may I say this. That person, if he had been in any trouble before, could have imposed on him a fine up to $500 or as low a fine as the magistrate saw fit to impose if it was the first offence. In that way the penalty is brought in line for that same driver driving 40 miles an hour out on Wellington Street. In other words, we have now brought up to date and correlated the fines or the penalties for the same offence, no matter whether it is committed on Wellington street or on parliament hill. Does that answer the question?


Mr. Lambert:: I have a brief word of commendation for the minister for the change that is being made in the act dealing with the voluntary payment of fines. This has been a particularly sore point in Edmonton at the new international airport where people have not been involved in parking regulations. Previously, at the municipal airport they simply received a parking ticket. Under the act as it stood prior to this amendment offenders had to appear in magistrate's court and take time off; somebody had to come in and give evidence. A good deal of time was lost and you were getting parking fines of $10 and more and costs; whereas for a mere city parking infraction the fine might be a ticket for $1. This amendment will remove a very annoying feature of traffic control at international airports particularly where you can easily run afoul of the law, for instance, in running over your meter. As the act stood previously, if you overran the meter, you were obliged to go to court and you could pay a fine of $10 or more. This amendment will now bring the practice in line and make for much more convenience for the public.


Mr. Hellyer:: Will the minister say whether the regulations provide for or whether the governor in council has the power to authorize the payment of fines by instalment in cases in which the magistrate might feel that course was desirable?


David James Walker: There is certainly nothing under the act which is being amended tonight, namely the Government Property Traffic Act. That being so, we would then have reference

War Veterans Allowance Act to the provincial law or the municipal law; and if there is such a provision there for payment on the instalment plan, that will be possible.


Paul Theodore Hellyer: That would apply to this act?


David James Walker: Yes.


Harold Edward Winch: Is there a section there which says that although the provincial or municipal police may have no authority on government land the law, when a charge is laid, is the provincial law. That is the point I was trying to get at. Someone says that although the municipal or provincial police have no authority on government land-I am speaking now particularly of land on the hill-because persons are charged and must appear before a magistrate or authority outside this hill, they then come under all the provisions of the provincial law.


David James Walker: Yes. The hon. member for Vancouver East is quite right. The procedure in the particular province in which the offence took place or the municipality, whichever happens to govern, would apply in any infringement of the law on any federal government property where this federal Government Property Traffic Act does not provide the penalty.


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


Gordon Minto Churchill: that the house go into committee to consider the following resolution:
That Bill C-101 intituled "An act to amend the War Veterans Allowance Act, 1952", now before the house, be amended, in clause 3 of the said bill, by adding the word "and" at the end of subparagraph (ii) and by striking out subparagraph (iv) of paragraph (a) in proposed subsection (4) of section 3 of the War Veterans Allowance Act, 1952.
Motion agreed to and the house went into committee, Mr. Flynn in the chair.


Gordon Minto Churchill: The purpose of bringing in this change by way of a resolution is this. It is occasioned by the fact that it might involve a financial obligation on the crown. Consequently we brought it in preceding the consideration of the bill. It strikes out a clause dealing with the widow of a recipient who dies outside of Canada. The clause as it stands in the bill at the moment means that such a widow would have to apply for an allowance within 12 months from the date

of the recipient's death. In the standing committee on veterans affairs it was considered that this was an unnecessary restriction to place in the bill. We have agreed with that view and consequently I am suggesting that it be now deleted. The widows of recipients are known to the Department of Veterans Affairs and we would not wish any widow to be deprived of an allowance that was her due simply because she had failed to make application within a period of 12 months.


Mr. Batten:: I should like to support this resolution which I think is important but should not require a great deal of discussion. I think that the original paragraph was much too restrictive. One can easily conceive of a situation in which a widow would not be eligible for war veterans' allowance within the first year after the death of her husband and would therefore not apply; but if she were not to apply within the first 12 months she would not be eligible for the allowance. I think this is a much more reasonable regulation and I would support it.


Herbert Wilfred Herridge: I rise to express briefly our pleasure at the introduction of this resolution which in effect accepts the recommendation of the Canadian Legion before the committee and the recommendation of the committee. While the amendment will affect only a limited number of veterans widows, prior to this time they have suffered, in our opinion, a measure of injustice. The matter has been brought to the attention of the government by hon. members on both sides of the house in the last year or so as a result of their experience of particular cases. The Canadian Legion and other organizations had experience of similar cases which were brought to their attention and as a result they made recommendations before the committee and gave very careful explanations of the reasons for those recommendations.
May I say again that we are very pleased the minister has introduced this resolution which further improves the amendments to the War Veterans Allowance Act which we expect to consider very soon.
Resolution reported and concurred in and referred to the committee of the whole on Bill No. C-101.


[Stage Direction]
Motion agreed to.

Gordon Minto Churchill: that the house go into committee of the whole to consider Bill No. C-101, to amend the War Veterans Allowance Act, 1952.

Motion agreed to and the house went into committee thereon, Mr. Flynn in the chair.
On clause 1.


Gordon Minto Churchill: Mr. Chairman, I have no intention of making a lengthy address at this stage of the bill. We have given very careful consideration to the whole problem. We had a discussion at the resolution stage on May 16 and debate on second reading on May 31. Since then the bill has received very careful study by the standing committee on veterans affairs and has now come back to the committee of the whole for consideration.
As I pointed out on those other occasions, the main amendment proposed in the bill involves a 20 per cent increase across the board for people receiving war veterans allowance and a larger increase for orphan children. The other amendments, as we come to them one by one, will indicate changes which will improve the administration of the act.
The committee may wish to ask certain questions concerning these various amendments. Hon. members may wish to spend some time discussing some aspects of them, but in view of the fact that the standing committee on veterans affairs undertook an intensive study of the bill and received representations from interested organizations it may be that we will not have to take too much time this evening in considering the bill. This bill will be of considerable benefit to veterans and their dependents, numbering approximately 70,000, who are under the administration of the war veterans allowance board.


Herman Maxwell Batten: Mr. Chairman, I should like to say just a few words on the first clause of this bill. The bill was studied very carefully in the standing committee and the various clauses were discussed. With regard to clause 1, I agree with the increase in allowance given to veterans because it brings the allowance they have been receiving more in line with the increase which has been given under another veterans act. As we go through the different clauses I may wish to ask one or two questions, but I have no further general remarks to make on the bill at this stage.


Herbert Wilfred Herridge: Mr. Chairman, I do not think there will be a very lengthy debate on this committee stage of the bill because we had a thorough debate on second reading and the bill was referred to the standing committee and considered very carefully there. The committee heard representations from the Canadian Legion and the Canadian corps association, and there were written representations from other veterans organizations.
90205-6-416J
War Veterans Allowance Act
The witnesses who represented the veterans organizations were questioned by the members of the committee and gave further explanations of the recommendations contained in their briefs and the reasons for introducing those recommendations.
In addition to that the officials of the department very carefully explained the present circumstances with respect to the administration of the act, the effect of the amendments on the administration and the effect on the veterans and dependents concerned. I might say that the Canadian Legion brief first of all expressed its belief in the value of the standing committee on veterans affairs. I quote from the brief:
We believe that continuation of the policy of referring legislative changes to veterans affairs committees where we can offer suggestions and information assures the veterans of Canada that the legislation affecting their welfare will receive careful study.
The legion also expressed its appreciation of this legislation by saying:
We feel that the introduction of Bill C-101, an act to amend the War Veterans Allowance Act, indicates that the government has been influenced by the recommendations which we have placed before it.
They went on to say:
We thank the government for introducing these amendments to the War Veterans Allowance Act at this session of parliament. We realize that the speech from the throne in November made no mention of this legislation, and we are sure that Canada's veterans, particularly those in receipt of war veterans allowances, will be most pleased with the changes, especially the increases in rates.
They were particularly pleased, I think, because of the result of the amendments to the Pension Act. It was brought out during the debate and in the committee studying the act that there were some 13,000 war veterans allowance recipients who were also pensioners and who received no benefit from the increases under the Pension Act. This legislation, as the minister said, will be of advantage to 70,000 war veterans allowance recipients and will remedy what we considered to be an unintentional injustice suffered by the 13,000 pensioners who are recipients of war veterans allowance.
As we consider the various measures contained in this bill I may wish to bring to the attention of the committee the proposals made by the Canadian Legion. I might say that the committee, after its study of the legislation, directed the attention of the government to the recommendations made by the Canadian Legion and other veterans organizations for further amendments. All I wish to say at this point is that we trust
6592	HOUSE OF
War Veterans Allowance Act the government will give these veterans organizations' recommendations directed to it by the committee sympathy and favourable consideration.


Harold Edward Winch: Mr. Chairman, I realize this is the second veterans pension act we have had before us this session. Of course we in this group support this bill. We have discussed this bill at the resolution stage and the second reading stage, it was referred to the veterans affairs committee and it is now being considered in committee of the whole. Because this is the last opportunity I should like to ask the Minister of Veterans Affairs if consideration has been given to a certain matter and if by any chance the hon. gentleman contemplates any amendment of this act to give recognition to a forgotten group of people. I refer to the merchant seamen who were in the front line of war. Thousands of Canadians died on merchant ships in the front line. They have never been recognized by any public act in Canada. I should like to ask the minister, taking advantage of this discussion on clause 1, which is the only opportunity I have, whether consideration is being given in this measure or any other to those who survived as far as recognition by Canada in the matter of pensions is concerned.


Mr. Weichel:: I had no opportunity of taking part in the discussion which took place on the resolution stage of this bill to amend the War Veterans Allowance Act and at this time I do not want to delay the bill. However, as a disabled veteran of the first world war and one who has been in close contact with some of these veterans from the first world war I feel sure this amendment will be of great benefit to the recipients who in many cases have served in both wars.
I am pleased, on looking over the bill, to see some of the changes which are to be made, especially the addition of time taken to travel to England and back again-in my case, 14 days going over and 10 days coming back. In some cases this extension will enable a number of veterans to qualify. I should like to commend the minister and the government on bringing in this fine legislation.


Paul Theodore Hellyer: I do not often commend the government but I should like to do so on this occasion. I think this is a very good bill. I welcome it on behalf of many people in my constituency who will benefit from it. I think it is timely and worth while, and I should like to thank the government for introducing it.


Gordon Minto Churchill: I should like to answer the hon. member for Vancouver East who raised a question concerning merchant seamen. I have given consideration to this problem affecting merchant seamen. It was one of the


first questions I raised with my departmental officials when I assumed this porfolio last fall.
Along with others, I have a great deal of admiration for merchant seamen who served in many instances in such perilous conditions during war time. I admit, frankly, that had I been asked to perform some of the duties undertaken by merchant seamen I might have been somewhat reluctant to come forward quickly.
A question with regard to merchant seamen was raised in the standing committee on veterans affairs, and my parliamentary secretary answered the question there. It amounts to this-that although there is a difficulty in bringing merchant seamen under the provisions of the War Veterans Allowance Act as it stands now because of the requirements set out in the act we think, nevertheless, that merchant seamen might be dealt with more properly under the civilian war pensions and allowances act. We are giving consideration to this problem. If this could be done it would obviate the necessity of declaring merchant seamen to be veterans under the definition which appears in the War Veterans Allowance Act. I agree with the hon. member for Vancouver East and with others who have raised this question that the problem has to be tackled and dealt with. I do not at all disguise my sympathy for the merchant seamen who are not at the present time benefiting under the War Veterans Allowance Act. Let us not forget, however, that those who were disabled have been taken care of.


Mr. Carter:: I had not intended to intervene in this debate-


An hon. Member:: The old, old story.


Chesley William Carter: -because we are anxious to get this legislation through and the hour is getting late, but what the minister has just said has caused me to rise and make a few remarks at this point.
I am grateful to the minister for telling the committee that this matter is under consideration but I would urge him to give consideration to bringing the merchant seamen under the War Veterans Allowance Act rather than under the civilian war pensions and allowances act as he has just suggested, because whatever act you bring these seamen under you will have to grapple with the problem of service and one of the big problems of the merchant navy is that there are so many different groups with so many different kinds of service-service on inland waters, service on coastal waters and service on the high seas. I do not think all of them can qualify, but I want to point out that this particular act which we are considering now, the War

Veterans Allowance Act, was set up for just such cases as these-for people who rendered service to their country in time of need and who are not qualified to receive regular service pensions. They were not wounded, they were not disabled, and perhaps there was some question as to whether they could be classed as veterans. I think this is where we should change our thinking. It is not enough to say that a person is a veteran because he served in a certain way. That, I think, is wrong thinking. Any man is a veteran who volunteered his services to his country in time of war and who risked his life in the service of his country. I will point out that the casualties in the merchant marine were often higher than in the regular service. A man can do no more than give his life. Of those who were spared I have many in my own district who are crippled with arthritis because of the soaking in the water that they underwent for hours, sometimes for days. I have others who are crippled with tuberculosis because they were cramped up in small quarters aboard ships. I have others who are crippled for other reasons traceable to their service in wartime. This act was set up to deal with such cases. If we call these people civilians we are throwing away the value of their service. We are saying to them that because they served in the merchant navy or because they were getting a certain rate of pay they are not veterans. I do not think that has anything to do with the definition of a veteran. A veteran is an individual who serves his country voluntarily in time of need. Surely these people are just as worthy and deserving of benefits under this act as those individuals in the other categories we have brought in.


Frank Exton Lennard: Nobody is arguing with you.


Chesley William Carter: Oh, yes they are. The minister suggested we had to keep away from thinking about bringing these individuals under the War Veterans Allowance Act, not considering them as veterans but as civilians.


Frank Exton Lennard: And he is right.


Chesley William Carter: I do not think he is right. A veteran is not a veteran because he puts on a uniform. Many veterans are drawing benefits under this act who never saw service or took any risk. Why should we decide just because they wore a uniform, they are any more worthy, and should receive the benefits of this legislation, than those individuals who served in the merchant marine? I should like to urge the minister to cast off this kind of thinking and to devise some means of bringing these individuals under the terms of this legislation, which has been set up to look
War Veterans Allowance Act after those individuals who cannot qualify for a pension in any other way.


Mr. Winkler:: Mr. Chairman, I should like to say a word or two in regard to this bill. Not having been in attendance at the committee meeting, this is the first opportunity I have had to do so.
I have received representations from individuals who will be the recipients of this increase, and who, because of the numbers of their families, are currently recipients of provincial welfare. These individuals are concerned that because of this increase they may be deprived of the benefits they are now receiving from provincial welfare. I should like to know whether the minister has considered this situation.


Mr. Jones:: Mr. Chairman, perhaps I could answer that question. The recipients of mothers' allowances and relief for dependent children paid by provinces or municipalities will not lose benefits as a result of this increase. Those allowances which they are now receiving are not included within the terms of income as set forth in this act, and the fact that they receive such allowances, will not have a bearing on their eligibility to receive benefits under this act. I do have a list of the exempted items from income, which includes mothers' allowances, family allowances, as well as a number of others, and could supply my hon. friend with that list if he desires.


George James McIlraith: Mr. Chairman, I should like to ask the parliamentary secretary to deal with the converse situation. I think he will find that mothers' allowance authorities consider the benefits of this act as income for the purposes of determining the allowances payable under provincial legislation, which is reduced when there is an increase in the benefit under this act. I think he will also find that this parliament has no authority in regard to this situation.


Henry Frank Jones: That is something over which the federal parliament has no control.


George James McIlraith: It is a very unhappy situation.


Henry Frank Jones: Any action taken by the provincial or municipal governments is taken under their own jurisdiction, not ours.


James MacKerras Macdonnell: Mr. Chairman, I should like to express my satisfaction with what the minister has said tonight regarding the fact that merchant seamen will not be overlooked. I have been greatly impressed by the words of the hon. member for Burin-Burgeo as well as those of the hon. member for Vancouver East. I am quite sure that every hon. member of this house feels that whatever else happens

War Veterans Allowance Act these men must not be unfairly treated. On the other hand, I should not like to argue with what the minister says should be done. I am perfectly content to leave it to him to do what is right. If it is his judgment to look after certain individuals in a certain way, I know that he has given much thought to it and go along with that judgment, knowing that he will do what is right.


Harold Edward Winch: We should not delay that action too long because there is no legislation covering those individuals now.


John Whitney Pickersgill: Mr. Chairman, I have only just come into the chamber and have had the chance of saying just a word or two to my friend the hon. member for Burin-Burgeo. I understand that he, as many other hon. members, has received representation in respect to merchant seamen. I should at this time like to join my voice with his in his expression of concern for them.
Mr. Chairman, I should also like to say a word or two about the 365 day regulations.


Henry Frank Jones: Mr. Chairman, we have not yet reached that item.


John Whitney Pickersgill: Are we not dealing with clause 1?


Henry Frank Jones: We are considering clause 1 but we will come to that specific item a little later.


John Whitney Pickersgill: Mr. Chairman, unfortunately I am supposed to attend three committee meetings tomorrow morning and felt that this perhaps was my only chance to say very briefly what I wish to say in regard to this legislation.
I should like to know why we must continue this discrimination in respect to the 365 day provisions, and why we cannot just do away with it altogether. I suggest this is an attempt to keep alive some old sores from the first world war which ought to be forgotten. This measure should be abolished altogether so that those individuals who went overseas during the first world war will be treated in the same way as those individuals who went overseas during the second world war. I think it is very unfortunate that this is not what is being done at the present time.
I should also like to suggest, as has been suggested by other hon. members on this side of the house from Newfoundland, that the Newfoundland forestry corps should be treated as veterans on exactly the same basis as the Canadian forestry corps because, if Newfoundland had been in confederation at that time, they would be treated in that way. I should like to repeat that this is perhaps something which ought to have been done


in our day and was not, which is no excuse for the present government not doing it.
We all know that under the Canadian Citizenship Act every Newfoundlander is treated as a born Canadian. The members of the Newfoundland forestry corps should be treated with equality on the same basis as other veterans. These individuals performed exactly the same services but, because they were enlisted in a civilian corps, they are treated differently. I suggest that distinction should not be perpetuated and that there is still a chance during this committee's consideration for the minister to eliminate this distinction.
The hon. member for Burin-Burgeo put a motion on the order paper which, if I remember correctly, was passed, but I do not believe a return has been made yet, asking for a list of all those awards which have been made to a certain category of Newfoundland veteran. I have a letter I intended to bring with me but did not, which appeared in one of the St. John's newspapers the other day written by an individual who had received an award, indicating thereby that he had been recognized as a veteran, but whose services have never been recognized since confederation. I suggest this problem should also be dealt with under the present legislation.


[Stage Direction]
Clause agreed to.
On clause 2.
Herbert Wilfred Herridge: Mr. Chairman, I am very pleased to note the inclusion of the provisions of clauses 2 and 3 in this bill. However, in view of the time that has lapsed before receiving amendments of this type, I should like to suggest that the war veterans allowance board keep statistics in relation to those individuals who benefit as a result of clauses 2 and 3. I think statistics of that type would be very interesting and could be used as a guide in respect to further amendments.


[Stage Direction]
Clause agreed to.
On clause 3.
Jacques Flynn: I understand that the
Minister of Trade and Commerce intends to move an amendment to clause 3.


George Harris Hees: Mr. Chairman, I move:
That clause 3 be amended by adding the word "and" at the end of paragraph (a)	(i), and by
striking out subparagraph iv of paragraph (a) in the proposed subsection (4) of section 3 of the War Veterans Allowance Act of 1952.


[Stage Direction]
Amendment agreed to.
Clause as amended agreed to.
Clauses 4 to 13 inclusive agreed to.

Title agreed to.
Bill reported.
Mr. Speaker:: When shall the said bill be read the third time? By leave, now?


John Whitney Pickersgill: By leave.


Gordon Minto Churchill: the third reading of the bill.
Motion agreed to and bill read the third time and passed.



EXPORT CREDITS INSURANCE ACT


George Harris Hees: the second reading of Bill No. C-108, to amend the Export Credits Insurance Act.
He said: Mr. Speaker, when this bill was being considered at the resolution stage a few days ago two hon. members asked questions, the hon. member for Ottawa West (Mr. Mellraith) and the hon. member for Kenora-Rainy River (Mr. Benidickson). I have answers to the questions which they asked me at that time and before proceeding with my remarks on second reading I should like to answer those questions for them.
At the resolution stage the hon. member for Ottawa West asked for certain information regarding liabilities incurred by the corporation under different sections of the act. I am pleased to inform the hon. member as follows: First of all, under section 13 of the act the corporation's liability amounted to $65,985,482 under policies of insurance outstanding at May 31,	1961. Second, under section 21
of the act the corporation's liabilities under policies of insurance issued and irrevocable commitments given for insurance amounted to $137,959,557 as at May 31, 1961. Third, under section 21A of the act no guarantees have as yet been issued by the Export Credits Insurance Corporation, and accordingly no paper has been purchased. For the information of hon. members, may I say that approval in principle has been given to guarantee and purchase negotiable instruments covering export transactions amounting to $48 million. In addition, business amounting to about $100 million is at present being negotiated by exporters and if it develops will require financing under section 21 A.
The hon. member for Ottawa West also made reference to the tabling of orders in council issued under sections 21 and 21A of the act. I am pleased to advise the hon. member that I consider the suggestion he made to be a good and sensible one and therefore when we come to the appropriate section
Business of the House
of the bill I will ask one of my colleagues to move the following amendment:
21B. All orders in council made under sections 21 and 21A while parliament is in session shall be laid before parliament during such session within 30 days of the date of their making and, if made while parliament is not in session, shall be laid before parliament within 30 days after the commencement of the next ensuing session.
The hon. member for Kenora-Rainy River also asked two questions at the resolution stage and I am pleased to reply as follows:
1.	The current sale of wheat to Poland represents 7.5 million bushels sold on terms of payment providing for 10 per cent on shipment, 30 per cent payable in 24 months, 30 per cent payable in 30 months, and 30 per cent payable in 36 months.
2.	With respect to the sale of wheat to China, the Export Credits Insurance Act is not involved.
Those are the answers to the questions which were asked at that time, Mr. Speaker. As I have some remarks with which I should like to introduce second reading of the bill and since it is very close to 10.30 I wonder whether I could call it 10.30?


Some hon. Members:: Agreed.



BUSINESS OF THE HOUSE

John Whitney Pickersgill: I wonder whether I might ask the house leader if he could indicate the order of the bills for tomorrow?


Gordon Minto Churchill: Any third readings that are ready tomorrow will be taken first followed by second reading of Bill No. C-108, an act to amend the Export Credits Insurance Act. The next item would be Bill No. C-lll, an act to amend the Railway Act, followed by the bill to amend the National Energy Board Act. If time permits we will also take the resolution dealing with the Pine Point railway.


John Whitney Pickersgill: Is the minister able to indicate what business will take place on Wednesday?


Gordon Minto Churchill: No. I am waiting to confer with people on the other side of the house with regard to that.


John Whitney Pickersgill: I should like to make a suggestion. There are certain Senate amendments that might be very agreeable for Wednesday.


Mr. Speaker:: May I remind the house that it is proposed to take a photograph tomorrow evening prior to the commencement of the budget as was forecast the last time when an effort was made to get a picture of the House of Commons in session.
At 10.30 p.m. the house adjourned, without question put, pursuant to special order.



APPENDIX


[Stage Direction]
Ottawa,
June 16, 1961.
The Honourable Leslie M. Frost, Q.C.,

[Stage Direction]
Premier of Ontario,
Toronto, Ontario.
My dear Premier:
At the dominion-provincial conference of February 23 and 24, 1961, I presented certain proposals with respect to the financial arrangements which might exist between Canada and the provinces for the five-year period commencing April 1, 1962. The major aspects of these proposals were that we should discontinue the present system of tax rentals in favour of tax collection arrangements, that the federal government would leave considerably more tax room for the provinces by withdrawing substantially in the personal income tax and that a broader system of equalization should be adopted which would give greater weight to fiscal need particularly when considered in conjunction with the proposal to increase substantially the Atlantic provinces adjustment grants and to continue for a further five years the special payment of $8 million per annum to Newfoundland.
The above proposals were discussed at the dominion-provincial conference of February 23-24. Since that time they have been discussed intensively by officials at two meetings of the continuing committee on fiscal and economic matters. The federal government has given very careful consideration to all the points raised and the purpose of my letter is to acquaint you with the conclusions we have reached.
In changing from a tax rental to a tax collection system of agreements, the first question to settle is the type of tax collection agreements which can be adopted to put the new system into effect. Under the system proposed the provinces will levy their own personal income and corporation income taxes. The Department of Justice has given intensive consideration to the possibility of devising agreements which would enable the Department of National Revenue to provide the tax collection service for those provinces which wished it without having to resort to provincial courts. If this could have been achieved, it would have greatly simplified the
task of the Department of National Revenue. However, it is the opinion of the Department of Justice that any arrangement which attempted to provide for the enforcement of the provincial taxes otherwise than through the provincial courts would be of doubtful constitutional validity. This means that the only type of tax collection agreement which can be safely entered into between the provinces and Canada is one in which the federal government will act as the agent of the province for the purpose of collecting the tax imposed by the province. The fact that an agency system of agreements must be entered into will complicate the work of the Department of National Revenue and will make it necessary to exercise extreme care in defining the relationship between the federal and provincial taxes.
A second important question has been raised involving the relationship between the federal and provincial taxes on personal income. Two possibilities have been discussed. The first is that the provincial tax might be a percentage of the federal tax. The second is that the provincial tax might be imposed on the basis of taxable income as defined under the Income Tax Act of Canada with a schedule of rates which followed the rate of progression in the federal income tax. The federal government is not prepared to offer tax collection agreements on both of these bases concurrently, partly because of the administrative complexity which would result for the Department of National Revenue, and partly because of the inconvenience it would cause to taxpayers and to employers who are responsible for tax deductions at source. In order that it will be possible to separate the provincial content of all tax deductions at source without installing a complete system of separate accounting for the provincial and federal levies, it is necessary that the percentage relationship between the provincial tax deductions and the federal tax deductions must be constant throughout the year. Since this is the case, it seems to the federal government that a provincial tax levied as a percentage of the federal tax has very clear advantages. We are prepared, therefore, to offer tax collection agreements to provinces in which the personal income tax is levied as a percentage of the federal tax.

There are no similar complications in the case of the corporation income tax and the federal government is prepared, therefore, to enter into tax collection agreements with the provinces for any corporation income tax which is expressed as a flat percentage of taxable income as defined for federal income tax purposes.
Some provinces have enquired as to the possibility of the federal government collecting for the provinces in addition to the income tax, a further flat rate tax which would apply subject to a stated dollar maximum as is the case with the federal old age security tax. The difficulty with this proposal is that the addition of such a tax to the provincial rate structure would destroy the uniform percentage relationship between the provincial and federal tax in all income ranges. The federal government could not, therefore undertake to collect such a special tax without becoming involved in completely separate accounting on an individual basis for the provincial and federal tax. This is a task which the federal government cannot assume because of the unnecessary additional burden it would place on the Department of National Revenue.
Questions have been raised as to whether natural resource revenue should be included in the formula and particularly whether certain elements of that natural resource revenue which have been referred to as non-recurring should be included. As I stated to the dominion provincial conference of February 23-24 in presenting the federal proposals, the reason for including natural resource revenue was to broaden the equalization formula by taking account of the great variation in provincial revenues due to natural resources. In our view, this addition to the equalization formula has greatly improved it from the standpoint of meeting the fiscal need of the provinces. The decision to include 50 per cent of all natural resource revenue as shown in the dominion bureau of statistics publication, "Financial Statistics of Provincial Governments", was taken to avoid uncertainty in the application of the formula. We believe that a thin line separates recurring from non-recurring revenues in the resource field, if indeed there is any line of separation at all. Consequently, to attempt any such separation would, we believe, lay the whole formula open to doubt and dispute. Since we are including only 50 per cent of natural resource revenue, we are not in any event allowing the full weight of either the recurring or non-recurring natural resource revenue to affect the equalization payments. I conclude, therefore, that the proposal to include 50 per cent of natural resource revenue in the equalization formula should stand as an essential part of the federal offer.
Some provinces have asked whether the federal government would be prepared to extend the guarantees offered under the federal proposals. One suggestion was that there should be an additional guarantee that no province would receive less in equalization under the new proposals than it would have received under a projection of the equalization component of the present arrangements. Another suggestion was that what was referred to in my statement to the conference as the (a) guarantee should be extended to provinces above the national average. Under the proposals as presented by the federal government, the provinces will receive the benefit of substantially increased tax room in addition to equalization and the equalization guarantees. The federal withdrawal from the personal income tax is to be raised to 20 per cent by the end of the period compared with the standard rate of 13 per cent for the present year. Having in mind its heavy responsibilities, the federal government cannot provide additional equalization guarantees of the type mentioned above while at the same time offering substantially increased tax room to the provinces.
A further question was raised with respect to the application of the equalization guarantee to those provinces in receipt of the Atlantic provinces adjustment grants. The Atlantic provinces adjustment grants, which it is proposed to increase by $10 million, will be paid separately under the terms of the new legislation. However, in determining the additional equalization to be paid to a province in the form of a guarantee, it is proposed to take account of the Atlantic provinces adjustment grants. This seems a reasonable procedure in view of the fact that the guaranteed equalization already provides for payments to the provinces in excess of their entitlement under the basic equalization formula.
At the conference I stated that the federal government was prepared to consider certain concessions in connection with the taxation of the forest industry if the provinces were willing also to make some concessions. It has been conceded that because the logging profits tax is levied in addition to the corporation income tax, the forest industry bears a greater tax burden than other industries. The possibilities of lessening the burden of taxation on the forest industry have been discussed at the official level. One of the possibilities discussed was that a tax credit shared between a province and Canada, might be granted to the industry. Before this
[Stage Direction]
can be done some further technical discussions will be required to reach agreement on the definition of logging income which will be subject to tax and accepted for the purpose of this tax credit. Subject to reaching agreement on this matter of the definition of logging income, the federal government is prepared as a means of relieving the tax burden on the forest industry to offer a tax credit equal to two thirds of the logging tax up to a maximum rate of 10 per cent, provided the province gives a tax credit equal to the remaining one third of such logging tax.
Request has been made for the preparation of a list of federal agencies and corporations which might be subject to provincial sales taxes. We are proceeding with the preparation of such a list and this matter will be resolved before the expiry of the present agreements at March 31st next.
I indicated in my statement to the conference of February 23-24, that the federal government was prepared to continue for the fiscal year 1961-62 the arrangements whereby the provinces receive a half share of the income tax collected from certain public utilities. A number of provinces have indicated that they believe there are strong reasons for continuing this sharing beyond the year 1961-62. We now propose as a concession to these representations to give the assurance that this sharing will be continued throughout the period of the next agreements,
that is, for the next five years up to and including the fiscal year 1966-67.
With regard to the progress which is being made with the preparation of legislation to implement the proposed financial arrangements for the period after March 31, 1962, it is our intention to introduce at the current session of parliament legislation which will provide the basis for the proposed new arrangements. The Department of Justice is making good progress with the drafting of this legislation. While the legislation will provide authority for the government of Canada to enter into tax collection agreements with the provinces, there will be a great deal of work involved in drafting the agreements themselves. This can come at a later stage. As soon as the draft legislation has been prepared which will provide the basis of the new arrangements, it will be possible for the Department of Justice to turn their attention to the preparation of model provincial legislation which would complement the draft federal legislation. I understand that it was the wish of some of the provinces that the federal government should assist them in this fashion.
I believe that the above comments deal with the major points which have been raised in connection with the federal proposals and I trust that they give you an adequate account of the progress to date.
I am,
Yours sincerely, John G. Diefenbaker.
[Stage Direction]
Tuesday, June 20, 1961