1961-05-09

Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, first I want to refer to the fact that you have tabled in the house and distributed to hon. members copies of the Canadian delegation's report on the fourth meeting of the Canada-U.S.A. interparliamentary group. I think the house will agree that this group has made a unique contribution to Canada-United States relations as well as to a wide knowledge of international affairs. Under the circumstances, and as in the past, if the house would agree, the report might be printed as an appendix to Hansard.


Mr. Speaker:: Is the house agreeable to the suggestion made by the Prime Minister that the document to which he referred be printed as an appendix to today's Hansard?


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



UNITED NATIONS


John George Diefenbaker: The hon. member for Vancouver East asked me a question yesterday regarding Canadian troops in the Congo. Since the answer is of some length I think it would be appropriate for me to give it at this time. His question arose in the light of the recent tragic loss of life among the Ghanaian contingent, and he asked for information about the position of Canadian troops and their capacity for self defence.
Canadian military personnel in the Congo are assigned to the United Nations and are under the authority of the United Nations Congo command. It is the United Nations command which has direct responsibility for the safety of United Nations troops, as well as for their effectiveness in carrying out their tasks.
On the question of self-defence, United
Nations troops in the Congo are still under basically the same orders as those issued by
the first United Nations commander, General Von Horn. These orders provided, in general, that members of the United Nations forces are authorized to use their weapons in self defence and to maintain positions which are considered tactically essential to the United Nations operations. These orders have been reinforced and given more detailed interpretation by the current commander, General McEoin.
In the light of the special difficulties and dangers faced by this non-combatant peacekeeping United Nations operation, Canadian members of the force have been given specific instructions by their Canadian commanding officer, derived from instructions issued by the United Nations commander. In essence the orders to Canadian troops provide that they may use their weapons for defence in certain clearly defined circumstances. Resort to force is, of course, to be used only if normal discussion or negotiation has proved impossible or unavailing.
The Canadian contingent in the Congo consists of technical and support personnel, mainly signallers. They are deployed at the U.N. headquarters signals centre in Leopoldville and in small detachments which operate communications at regional centres throughout the Congo. In Leopoldville the Canadian soldiers are responsible for the defence of their own building. The grounds around the building are guarded by line troops from other contingents in the U.N. force. At the regional centres the Canadian signals detachments are stationed within U.N.-garrisoned areas.
Despite their technical role, the Canadian troops in the Congo, because of the risks which have become evident in the situation there, have over the past few months been supplied with heavier weapons in addition to those with which they were equipped when they first went to the Congo.
I hope the house will agree that the Canadian troops which are participating in this Congo operation have been given reasonable authority and means with which to meet the dangers inherent in that operation.


Hon. L. B. Pearson (Leader of the Opposition):: Mr. Speaker, I believe that all
hon. members will have heard with satisfaction the statement made by the Prime Minister. All hon. members must be extremely proud of the way in which Canadian forces

Canadian Forces in Congo are serving their country and peace in the Congo in circumstances of unprecedented difficulty which make the qualities of discipline which they possess even more important than they are ordinarily.
While we pay tribute to their devotion and to their discipline it is surely essential, as the Prime Minister has indicated, that there should be no doubt that they have both the authority and the facilities with which to defend themselves against unprovoked assault. It may not be easy to lay down, in the words of the Prime Minister, the clearly defined circumstances which would justify the use of defensive weapons, but I am sure every effort will be made by the United Nations to make sure that in the attempt to do that the safety and security of those concerned is the first consideration.


Mr. Harold E. Winch (Vancouver East):: Mr. Speaker, I appreciate the fact that the Prime Minister has taken the earliest opportunity to give to the house a statement on the question I asked him yesterday relative to the position of our Canadian forces in the Congo. I think it is important for all of us to recognize the fact that there is a difficult situation existing in the Congo, as there has been for some time.
As a result of representations made in the security council of the United Nations, Canada was asked, and immediately complied with the request, for certain men, in particular those who spoke French, to undertake certain responsibilities in the Congo. As the Prime Minister has pointed out, a number of difficulties have arisen, some of them of such a serious nature that there have been, I would say, most embarrassing attacks-without reply by the Canadians, for which fact they are to be honoured-but of recent days particular attacks on the U.N. forces of such a nature that they have led to a number of deaths.
We appreciate the statement which has been made by the Prime Minister. We hope he can perhaps enlarge on the statement, if not now then in the question period, as to exactly what is meant by what he said a few moments ago to the effect that instructions have been issued to our Canadian peace forces in the Congo to defend themselves under what he termed "clearly defined circumstances". I think, sir, that as Canada has met the requests of the United Nations in every respect, this house is entitled to know what the Prime Minister meant by "clearly defined circumstances". Because of what has happened to the troops of Ghana and, as we understand from the press, a number of white officers, I think we should know what equipment is now being supplied to Canadians.


In conclusion, I think it is imperative that the statement made a few moments ago by the Prime Minister should be enlarged so we may know whether any consultations have taken place between the government and the United Nations as to instructions through the secretary general of the United Nations to the command in the Congo concerning the arrest of those who have committed the slaughter of those who were trying to help, and what charges should be laid against them.
I think Canada has the right to ask for answers to the questions I have just outlined. Perhaps the Prime Minister would now, or later in the question period, elaborate on the points I have just raised.

On the orders of the day:


Harold Edward Winch: should like to direct a question to the Prime Minister. In view of the statement made under motions a few minutes ago and my observations in regard to it I should like to ask, in the light of the fact that Canada's forces in the Congo, although in uniform, are a police force under the command of the United Nations, whether the Prime Minister would not give the house more definite information as to the nature of the arms carried by Canadians in the Congo. Would the right hon. gentleman tell us what he meant by saying that these arms could be used under "clearly defined circumstances"? Might we be told, further, whether any representations have been made to the United Nations, and through that organization to the commander in the Congo, as to the action to be taken with regard to those in the Congo who have apparently not understood, or object to, the efforts of Canada and the United Nations to make peace in that troubled area of the world?


John George Diefenbaker: In so far as the second question is concerned with reference to the grounds which have to be established before United Nations troops are entitled to respond with force, the circumstances that are to be taken into consideration are as follows: they have the right to resist attempts to disarm them; to resist attempts to arrest or abduct any United Nations personnel, military or civilian; to resist attempts to prevent them by force from carrying out their responsibilities as ordered by their commanders; and, in addition, to use weapons in defence of positions they have been ordered to hold.
As to the first question, notice of a similar question was sent to me by the hon. member for Davenport. He wishes to know, as does the hon. member for Vancouver East, the

nature of the arms which are issued or available to United Nations troops. Originally the Canadian contingent was equipped with pistols and sub-machine guns. They now have as well a quantity of semi-automatic rifles, six light machine guns and two 3.5 inch rocket launchers. Mr. Speaker, I am not sure what the third question was.


Harold Edward Winch: Mr. Speaker, perhaps I can put that question again in this way, in the hope that I am not making an erroneous comment. In view of what the United Nations wants and is trying to do in the Congo-Mr. Ham-marskjold is doing a magnificent job in this regard-and since Canada is taking a part in the maintenance of peace in order to bring about a democratic state there; and in view of the unfortunate situation that United Nations representatives in uniform are being shot down, I should like to ask if this government has in any way taken up this matter with the United Nations in order to have United Nations action-because it is wrong to have a tour de force without force-and in the circumstances to bring to trial those who have done what has been done in opposition to the United Nations. On what basis have representations been made in order to bring to trial those individuals responsible for this criminal attitude, and what charges will be laid? Has any attitude been taken by this government on this most important matter?


John George Diefenbaker: Mr. Speaker, naturally discussions have been taking place in this regard, but when the hon. gentleman speaks of enforcing the law against those who break the law he should have some regard to the tremendous areas in the Congo and the virtual impossibility of enforcing the law against individuals.
In that connection I should amend an answer I gave yesterday with respect to Mr. Tshombe. I am now informed that the United Kingdom government did convey a message to the United Nations calling for the release from detention of Mr. Tshombe. I did not have this information yesterday. However, since the United Kingdom government sent this message the situation has altered, and I can only again express the hope that this trial will be proceeded with justly and fairly and with full recognition of the rights of an accused to a fair trial.



VETERANS AFFAIRS


Hon. Gordon Churchill (Minister of Veterans Affairs):: Mr. Speaker, some time ago I informed the house that the government was 90205-6-287
Inquiries of the Ministry completing its study of the possibility of reducing the small holding acreage requirement under the Veterans' Land Act below the present minimum of two acres.
The government has now approved the principle that financial assistance for the establishment of a veteran on a small holding shall be made available where the land area is at least one half an acre in extent. The necessary amendment to the Veterans' Land Act regulations is in course of preparation and will set the effective date of the proposed change.
An additional amendment to the regulations will be made to provide that a veteran who has already been established on a small holding shall be permitted, where it is possible, to dispose of his land to the extent that it exceeds one half an acre. It is expected that it will be possible to grant this permission in the majority of cases.


Mr. H. W. Herridge (Koolenay West):: Mr. Speaker, I cannot help but rise and express the great pleasure of this group on the announcement just made by the Minister of Veterans Affairs that the government has approved in principle financial assistance to those desiring to obtain small holdings under the Veterans' Land Act by reducing the acreage requirement to half an acre. This will be a very welcome announcement to thousands of veterans in Canada who up to this time have been denied an opportunity to obtain a small holding because of the difficulty in meeting the former acreage requirement.
I was very pleased also to hear the minister say that arrangements are being made for veterans who are already settled to dispose of any surplus acreage above that amount.



BUSINESS OF THE HOUSE


[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: Mr. Speaker, I should like to ask the Prime Minister whether he can inform the house when certain legislation which has been forecast will be added to the order paper, which has not been substantially changed for six weeks.


John George Diefenbaker: Mr. Speaker, the fact that the order paper has not been substantially changed for six weeks in no way implies that the house has not been working full time. When the business on the order paper is cleared away, or nearly so, then will be the time to give effect to the adding of further items.

Inquiries of the Ministry EXTERNAL AFFAIRS


REPORTED STATEMENT IN OSLO BY EXTERNAL AFFAIRS MINISTER
[Stage Direction]
On the orders of the day:
Mr. Hazen Argue (Assiniboia):: I should like to direct a question to the Prime Minister. I wonder if the Prime Minister would care to make any comment on press reports of statements being made by the Secretary of State for External Affairs (Mr. Green) in Oslo to the effect that the United States should take no unilateral action in Cuba.


John George Diefenbaker: I have not seen the full text of the statement made by the Secretary of State for External Affairs, but what he is reported to have said is quite consistent and consonant with what I said in the House of Commons on April 19. As to armed intervention, there has never been any doubt as to the Canadian attitude. As I indicated then, Canada has no thought of intervening.
The rest of the statement was apparently concerned with the question of possible negotiation. Naturally, in view of the support we have at all times given for the settlement of disputes between nations by peaceful means, we would hope that a basis could be found for negotiation, although certainly the present circumstances do not lead one to be too optimistic in that regard.


Hazen Robert Argue: Is there any thought that this particular issue and these particular differences might be taken up by the United Nations?


John George Diefenbaker: Differences do get taken up there from time to time.


Hazen Robert Argue: Would Canada support such an action?


[Stage Direction]
On the orders of the day:
Mr. J. A. McGrath (St. John's East):: Mr. Speaker, I have a question for the Prime Minister. Can the Prime Minister tell the house whether there are Canadian citizens who are still being held by the Cuban authorities?


John George Diefenbaker: Mr. Speaker, the Canadian embassy in Cuba has been doing everything possible to secure exit permits and transportation for Canadians who desire to leave Cuba. It is hoped that a number of Canadian priests and nuns whose work in Cuba must now be discontinued will be able to return to Canada.


In that connection I might point out that over the week end there was a serious deterioration in the situation in Colon, where many Canadian nuns are stationed. Representations were made by the Canadian ambassador and Premier Castro, who is taking a personal interest in the matter, has sent a personal representative to look into the question. I believe it can now be said that Premier Castro has undertaken to ensure the safety and welfare of the Canadians concerned. His personal representative is endeavouring to ascertain what action can be taken immediately.
In that connection I should point out that Father Paul Emile Chenard, a Canadian priest who has been under arrest since the middle of April, has now been released from prison and is safe and well. There is just one other Canadian under arrest, John Darling, and the Canadian embassy in Havana is continuing to make representations on his behalf to the Cuban foreign ministry.


Hon. Paul Marlin (Essex East):: Can the
Prime Minister say whether the Canadian government through its spokesman, the Canadian ambassador in Cuba, has made representations with regard to the designation by Premier Castro of priests and nuns from this and other countries as scoundrels? Can the Prime Minister say, too, whether there has been any confiscation of properties in Cuba owned by Canadian religious bodies?


John George Diefenbaker: As to the latter part of the hon. gentleman's question or remarks, I might say we have no information in that regard that would lead us to believe that there has been any confiscation. As to the earlier part of his question, the hon. gentleman may rest assured that the fullest representations are being made by the Canadian ambassador in Cuba, and I am glad today to be able to report that the representations made by Canada have been so successful.
(Translation):



SHIPPING


[Stage Direction]
On the orders of the day:
Mr. H. J. Robichaud (Gloucester):: Mr. Speaker, I should like to direct a question to the Minister of Transport.
Is the minister in a position to inform us of the action taken by his department to dispatch ice-breakers to the Chaleur bay area so as to hasten the opening of Caraquet and Shippigan harbours where fishermen are anxiously waiting for the break up in order to begin their new fishing season?


Hon. Leon Balcer (Minister of Transport):: Mr. Speaker, representations were received on March 24 from those two municipalities. At that time the ice was too thick and it was impossible for the department ice-breakers to break it.
Since then the ice-breaker McLean has
kept on working in Chaleur bay, using a helicopter to keep a constant watch on the ice floes that have formed in the two harbours in question.
As soon as the ice is thin enough to be broken by our ice-breakers, this will be done immediately; this should take place early next week.



BRIDGES


[Stage Direction]
On the orders of the day:
Mr. H. Pit Lessard (St. Henry):: Mr. Speaker, I should like to direct a question to the Minister of Transport. Would the minister indicate to the house if the plans for the Champlain bridge approaches are completed and, if not, what is the cause of the delay?


Léon Balcer: I will inquire about that, Mr. Speaker, and I will give an answer to the question tomorrow morning.


H.-Pit Lessard: I have a supplementary question, Mr. Speaker. Is it a fact that the government is waiting for the Montreal city authorities to decide where the east-west express highway will pass before deciding on the site for the Champlain bridge approaches?


Léon Balcer: Mr. Speaker, the officers
of my department are discussing the matter with those of the city of Montreal. I know the discussions have been going on for some time, but I am unable to say how the matter stands now. I will find out and give an answer tomorrow.
(Text):



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Hon. Paul Hellyer (Trinity):: Mr. Speaker, I should like to direct a question to the Minister of National Defence. Is it a fact, as reported by the Canadian Press, that the R.C.A.F. CF-100 jet interceptors being withdrawn from disbanded air defence squadrons will be turned over to Crown Assets Disposal Corporation for sale as scrap?
90205-6-287J
Inquiries of the Ministry


Hon. D. S. Harkness (Minister of National Defence):: Mr. Speaker, the CF-lOO's which will be surplus to establishment as a result of the disbanding of the four squadrons will have removed from them all parts that can be used for the purpose of making repairs on the other CF-lOO's which we will still hold. What is left after that, and to a large extent it will be the air frame, which has no practical value or use, as such, will then be turned over as scrap for disposal by Crown Assets Disposal Corporation.


Paul Theodore Hellyer: In view of the obvious inference, can the minister say what plans he has for replacing the obsolete CF-lOO's being used by the five continuing squadrons?


Douglas Scott Harkness: The hon. member well knows that I am not going to make a statement of major government equipment policy in answer to a question at this period of our proceedings.


Mr. Pickersgill:: Is there a policy?



HOUSING


[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: wish to direct a question to the Minister of Public Works. In view of the anxiety of the Trail city council to proceed with its urban renewal development program as soon as possible, would the minister inform the house when he expects a decision will be made as to the acceptance of this program by the federal government?


Hon. D. J. Walker (Minister of Public Works):: Mr. Speaker, the Secretary of State for External Affairs made inquiries last week on behalf of the city of Trail. Recently the city submitted to Central Mortgage and Housing Corporation an application for a federal contribution toward the cost of acquiring and clearing a blighted area of approximately 14.4 acres. It is proposed that approximately 40 per cent of the cleared land be used to provide a right of way for the relocation of a provincial highway into Trail, and thus we have our difficulty.
It will therefore be necessary for the corporation to discuss with the city and the province the basis on which this land will be made available to the department of highways. I trust that these negotiations may soon be concluded so the corporation may make the appropriate recommendations to me. I should also like to assure the hon. member that this application will receive the most careful and sympathetic consideration.

Inquiries of the Ministry


Herbert Wilfred Herridge: I presume the minister
thought that the Secretary of State for External Affairs was inquiring on my behalf?


David James Walker: Mr. Speaker, I thought he was to make a speech last week in Trail.



AIR TRANSPORT


[Stage Direction]
On the orders of the day:
Hon. Lionel Chevrier (Laurier):: I should like to direct a question to the Minister of Transport. Has the government come to a decision with reference to a policy concerning regional air carriers? If so, does the minister anticipate making a statement on that subject in the near future?


Léon Balcer: Mr. Speaker, as I believe I said earlier in the
house, the air transport board has made a complete review of all the regional carriers east of the lakehead, and it is anticipated that a decision on the various requests before the board should come within a very few days.


Lionel Chevrier: Can the minister say whether the application of Canadian Pacific Airlines for additional trancontinental air routes will be submitted to the air transport board for determination?


Léon Balcer: Again, Mr. Speaker, I think I have said in the house before that all applications for internal air transportation have to come before the air transport board. So far as C.P.A. is concerned, when C.P.A. was granted a transcontinental flight across Canada about two years ago the air transport board said at the time that two years hence a review of the situation on the transcontinental route would be made by the board.



TELEVISION


[Stage Direction]
On the orders of the day:
Hon. George C. Nowlan (Minister of National Revenue):: Mr. Speaker, yesterday the hon. member for Bonavista-Twiflingate referred to a question he had asked previously of my colleague the Minister of Transport and myself respecting an application for a television satellite station in Saskatchewan. I am advised by the board of broadcast governors that the board has recommended to the governor in council approval of a satellite licence to A. A. Murphy and Sons Limited of Saskatoon. I am also advised that written representations have been received by the


governor in council objecting to this decision, and the matter has not yet been considered by the government.
While I am on my feet, may I say I have had an inquiry from the hon. member for Moose Mountain respecting another application for a satellite station. This matter will be given consideration and a decision arrived at in the near future.



URANIUM


[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: May I ask the Minister of Trade and Commerce when he expects to leave for London to discuss the uranium contract with the British government?


Hon. George H. Hees (Minister of Trade and Commerce):: Mr. Speaker, I have been in touch with the high commissioner's office here about arranging a meeting between ourselves and our opposite numbers in the British government. The best arrangement it has been possible to work out is that as Sir Roger Makins will be visiting Canada on June 12, discussions on this important matter will be carried on then.



CIVIL DEFENCE


[Stage Direction]
On the orders of the day:
Mr. M. W. Marlin (Timmins):: I should like to direct a question to the Prime Minister, and I regret that I was unable to give him longer notice. With reference to the Canadian National Railways special train which evacuated government personnel in exercise Tocsin last Friday, can the Prime Minister inform the house whether the cost of this special train was paid for entirely by the Canadian National?


Mr. Speaker:: Order; I think without notice the hon. member is a little optimistic in expecting this statistical information. I suggest that he put his question on the order paper.
[Later:f


Harold Edward Winch: Mr. Speaker, I should like to direct a question to the Prime Minister. In view of the importance which he placed on the statement made in the house last week concerning operation Tocsin which, for the first time-


Mr. Speaker:: Order. If the hon. member has a question about Tocsin would he please ask it.


Harold Edward Winch: 1 am just trying to lay a basis for the importance the Prime Minister based on it. In view of operation Tocsin finding gaps in civil defence, has the Prime Minister given any consideration to an allocation of time to discuss this matter of civil defence and the results of the exercise from a federal, provincial and observer's point of view?


John George Diefenbaker: The exercise was a most important one, and one of the purposes as stated was to assure that every element in our civil defence should receive proper attention.


Hazen Robert Argue: Including observers.


John George Diefenbaker: In the province of the hon. gentleman, apparently the ministers did not participate, but in other parts of the country the provincial ministers did. When reports from the various parts of the country have been received and collated, then I will be in a position to make a report to the house. Consideration can then be given to the other parts of the hon. member's question.


John George Diefenbaker: I do not want any misunderstanding over the province to which I referred a moment ago. It was in consequence of an interruption on the part of the hon. member for Assiniboia that I made the statement in question as to participation.


Hazen Robert Argue: Speaking on a point of order, Mr. Speaker, may I say that the Prime Minister referred to "my province". I think he should have said "our province".


John George Diefenbaker: That correction is
accepted. However, the government of his province is the one to which I referred.


Hazen Robert Argue: Your government.


An hon. Member:: His government of our province.



UNEMPLOYMENT INSURANCE


[Stage Direction]
On the orders of the day:
Mr. W. H. McMillan (Welland):: I should like to direct a question to the Minister of Labour which has to do with two related matters to which I directed his attention last week. Is it necessary for the unemployed who have drawn benefits to clear with the local unemployment insurance office before leaving their area for a day or so? Will any of the unemployed who took part in the recent trip to Ottawa to see the government be penalized in any respect, for instance by the withholding of benefits?
Inquiries of the Ministry


Hon. Michael Starr (Minister of Labour):: The other day the hon. member for Welland asked me a question which read as follows:
I have a supplementary question. Without reference to the unemployed who came to Ottawa, how long can a man be out of his area and still receive unemployment insurance benefits if he is entitled to them?
I referred this question to the unemployment insurance commission and have received this answer: This depends entirely on the reason for the claimant's absence and whether or not he maintains his availability for work. Because of these factors no categorical answer can be given, each case being decided on its own merits.


William Hector McMillan: May I ask a supplementary question, Mr. Speaker. Is the minister aware of the fact that several unemployed have received letters to the effect that $8 will be deducted from their allowances for being away on that date?


Michael Starr: Several of them have communicated with me, and I have turned over their letters to the unemployment insurance commission. I am awaiting the decision and reply of the commission.



AGRICULTURE


[Stage Direction]
On the orders of the day:
(Translation):
Mr. Samuel Boulanger (Drummond-Ariha-baska):: Mr. Speaker, I wish to direct a question to the Minister of Agriculture.
(Text):
Is it the government's intention, as reported in some newspapers, to put an end to the quota restrictions on turkeys imported from the United States?


Hon. Alvin Hamilton (Minister of Agriculture):: I have not seen the article in question in the newspaper. However, the announcement I made in the house that there is no intention of changing the quota still stands.



SOYBEANS-REQUEST FOR INCREASE IN FLOOR PRICE

[Stage Direction]
On the orders of the day:
Paul Joseph James Martin: In view of
the remark of the Prime Minister with regard to an election perhaps I might ask the Minister of Agriculture, who of course is not concerned with elections, whether he has any reply to make to the representations made by the Ontario soybean growers' marketing board

Inquiries of the Ministry for an improvement in the floor price. They asked for $2.50, and I hope the minister will be able to accede to that request.


Francis Alvin George Hamilton: Government policy in respect of this type of subject is announced at a time suitable for such announcement to be made.



ADMINISTRATION OF JUSTICE


[Stage Direction]
On the orders of the day:
Mr. J. R. Tucker (Trinity-Conception):: should like to direct a question to the Postmaster General. Would the minister please advise whether the Royal Canadian Mounted Police have completed their investigation into the damaging of mail boxes in sites 58 and 59, Nagle's Hill-Higgins' Line, St. John's, N ewf oundland?


Hon. W. M. Hamilton (Postmaster General):: It has not been completed, Mr. Speaker.


James Roy Tucker: May I ask a supplementary question. How long does the minister think it will be before he receives a report?


William McLean Hamilton: suggest that the hon. member refer that question to the Minister of Justice. It is the Royal Canadian Mounted Police investigation, not ours.


Mr. Speaker:: I think the hon. member might put his question on the order paper, since it does not seem to be one of sufficient urgency or importance.



TRANS-CANADA HIGHWAY BRITISH COLUMBIA    REPAIR OF FLOOD DAMAGE IN FRASER CANYON

[Stage Direction]
On the orders of the day:
Mr. Harold Hicks (Fraser Valley):: I have a question for the Minister of Public Works. Some time ago I asked the minister whose responsibility it was to repair the trans-Canada highway flood damage in the Fraser canyon of British Columbia. I would appreciate that information.


David James Walker: I regret overlooking an answer to the hon. member. The highway had been completed in this area in accordance with the trans-Canada highway agreement. This being the case, the maintenance of the highway then becomes the responsibility of the province. Having regard to the fact that the damage in this instance was caused by excessive rainfall, we must look to the province for the completion of repairs to the highway. The federal government has no responsibility.



CANADA GAZETTE


[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: I wish to address a question to the Secretary of State. Can the minister assure the house that al announcements published in The Canada Gazette by any department of government are correct?


Mr. Speaker:: Order. The hon. member is taking in a lot of territory. I am afraid he might not get a complete answer if he asked this question every day.



INQUIRY AS TO POSSIBLE DATE OF GENERAL ELECTION

[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Pori Arthur):: I should like to ask the Prime Minister a question, Mr. Speaker, based upon nothing other than the pleasant state of euphoria that seems to have settled over the government recently. I wonder if the Prime Minister would tell us whether he has given serious consideration to initiating a federal general election on September 25 or October 2, 1961?


John George Diefenbaker: I think that with the addition of those two dates, the opposition has pretty well covered every date in the year.



TRANSPORT


[Stage Direction]
On the orders of the day:
Mr. Lucien Cardin (Richelieu-Vercheres):: wonder if the Prime Minister would be in a position to answer today a question I asked yesterday concerning whether or not the government had any representations from the state department-
Righl Hon. J. G. Diefenbaker (Prime Minister): Oh, yes, Mr. Speaker. The hon. gentleman asked whether representations had recently been made by the United States state department regarding the possibilities of a joint survey of the Richelieu river canal project. A note on this subject was received from the United States embassy on May 4, and its contents are now being considered and studied by departmental officials.


Louis-Joseph-Lucien Cardin: Would the Prime Minister consider tabling this correspondence?


John George Diefenbaker: Mr. Speaker, the hon. gentleman knows that notes that pass between governments are not tabled in that way.



SPRINGHILL, N.S.-REQUEST FOR MAINTENANCE OF RAILWAY SERVICE

[Stage Direction]
On the orders of the day:
John Whitney Pickersgill: I wonder if I could ask the Minister of Transport whether he has yet had a reply from the Canadian National Railways with respect to the suggestion that they take over the 4 mile spur line from their line into Springhill, Nova Scotia, about which the minister was asked on February 17?


Léon Balcer: I will have to inquire again, Mr. Speaker.



COLUMBIA RIVER


[Stage Direction]
On the orders of the day:
John Whitney Pickersgill: I wonder if I could ask a supplementary question of the Minister of Justice. Could the minister tell us how he got on with his discussion of the Columbia matter during the course of exercise Tocsin?


Hon. E. D. Fulton (Minister of Justice):: To
my regret, Mr. Speaker, and to my considerable surprise-and contrary to expectations -Premier Bennett was not at the emergency headquarters in Nanaimo. I understand he was not in the province of British Columbia at the time. Therefore I was not able to have any discussion with him.

The house resumed, from Monday, May 8, consideration of the motion of Mr. Fleming (Eglinton) for committee of supply, and the amendment thereto of Mr. Robichaud, and the amendment to the amendment of Mr. Argue.



UNEMPLOYMENT INSURANCE


William Hector McMillan: Mr. Speaker, last night at ten o'clock, when the house rose, I was discussing the amount of money in the unemployment insurance account. Last night I said that on July 1, 1957, just after the election, there was $862 million in that account. Today, with bonds and securities at market value, there is $146 million left in that account. It is down by $716 million.
I said that was a great deal of money. It is within $100 million of the extra interest that this government has saddled on the people of Canada. Together these two amounts total $1,500 million. That is just a fraction of what this government has done to the people of Canada with practically nothing to show for it. It has dropped this account by $716 million in something less than
Unemployment Insurance four years. By next July, when the four years are up, that fund will be down to $100 million or less, according to the unemployment insurance advisory committee, and they say most likely to $85 million.
In this $716 million depletion there is an amount of $66.2 million of actual loss from selling bonds at less than they paid for them and bonds held and priced at the present market value. The unemployment insurance coverage has been extended. The base has been broadened. But since the insurance aspect of this account has largely been forgotten by this government, it has assumed obligations in respect to unemployed people that properly belong to the government and not to the fund. Because of this situation the Minister of Finance has been able to shove some of the legitimate costs of government into that fund. As bad as they have been, his budgets would have been a great deal worse and he would have had larger deficits if the money in this fund had not been available.
The fiscal policy of the government has, through high interest rates, stagnated our economy. According to the press Mr. Coyne said that interest rates depended upon government and other requirements. Money is a commodity; and as with any other commodity, its price or the interest rates depend upon supply and demand. The Minister of Finance has certainly supplied the demand. I do not think there is much hope for an increase in the value of the bonds and other securities held in the unemployment insurance account, with the Minister of Finance on the sideline. You would almost think he is afraid to bring down his budget and show what a big deficit we had last year and what a big one we are going to have this year. At the same time we know that he will be requiring a great deal of extra money. It would seem that the minister's mind is in a state of turmoil, and that the budget will be based upon the political climate immediately ahead. I think he should adapt his budget to the needs of our country instead of to any political considerations.
If the unemployment insurance account is any indication of high finance by this government, the minister might better bring down his budget now and not have it embellished with any propaganda. The government lost over $65 million in the unemployment insurance account. Much of this amount was lost in the conversion loan issues. It does not matter whether you say that the conversion loan gave people bigger and better jobs, as the Prime Minister said it would. It does not matter whether you try to make the people believe that they got cheaper money, that provinces and municipalities got

Unemployment Insurance money at a cheaper rate, as the government said they would. I think it all comes down to this point. You cannot make the working people of Canada or the taxpayers of Canada believe that the loss of this $65 million was good for them.
This loss has come about because of the fiscal policy of the government. We on this side of the house at various times in 1960, as well as the unemployment insurance advisory committee, advised the government that something should be done about this dangerous situation of the unemployment insurance fund. The speech from the throne also recognized this fact. Last November in the speech from the throne it was forecast that legislation would be brought down to replenish this fund. What has been done? We have been sitting here for over 100 days and nothing has been done. The fund has been forced to incur new losses through the sale of securities in order to meet the demands on it with regard to benefit payments.
There is obviously only one reason to explain the government's delay. In spite of the fact that the unemployment insurance advisory committee has advised that the government should take certain specific and concrete steps, and in spite of the existing emergency, after all these months the government have done nothing. They have not made up their minds. We do not know whether they are going to accept the recommendations of the advisory committee or whether they have an alternative plan.
I challenge the government at this time and I challenge the minister to deny that no amendments of the bill are ready to present to this house. I do not think they have any at this time. I ask the minister to tell the house when he intends to introduce this urgent legislation, and to give a definite understanding that the present session will not come to an end with nothing being done with respect to this fund.
I want to repeat that the government is facing an urgent situation. The fund is still forced to unload its securities at a loss. The fund is also forced to hypothecate some of these securities and borrow money from the Minister of Finance. I do not know what interest he charges. This process is bound to come to an end. They will soon have no bonds to sell and the unemployment insurance fund will soon have no bonds to hypothecate. Then, in the absence of new legislation, the fund will have to interrupt the payment of benefits to those who become unemployed, unless the fund is replenished. This would certainly be a catastrophe. There is, I know, one course which is open to the government,


but it is an irregular and most unusual one. That would be to have recourse to governor general's warrants.
For all these reasons I ask the minister to present these amendments to the Unemployment Insurance Act early this coming week. This is not an unreasonable request on the part of the opposition. I think the government should long since have made up their minds as to what they are going to do, and should have presented this legislation to the house. If the minister does not comply with this request, we on this side of the house, hon. members in all parts of the house and the people of Canada will know that this government does not know where it is going. This is just another indication and example of indecision, procrastination and inaction on the part of this government, and we have seen many such examples in the past.
I think this loss of over $65 million in the unemployment insurance fund is a serious matter. I do not know whether it has ever happened before in Canada. Certainly I do not know of any other instance where a government had control of the working people's money and lost it by bad investment.


Paul Joseph James Martin: And mismanagement.


William Hector McMillan: The unemployment insurance committee got out a special report on October 27, 1960. It is easy to read that report. I have it here. It can be read in half an hour. The government kept it for six weeks and presented it to the house in the dying hours of the last day of the session before Christmas.


Paul Joseph James Martin: They did that twice.


William Hector McMillan: They did not want the people of Canada to know about this report before Christmas. The unemployment insurance advisory committee had this to say:
It is not safe to estimate that the fund will have a balance of greater than $140 million to $150 million by the end of March, 1961.
They were right, because that fund has $146 million in it at the present time. In addition, they said that because of heavy seasonal benefits during April and May of this year the fund would possibly be as low as $85 million, a most unsafe level. The advisory committee called attention to two main items which created the major drains on the fund. They are first, the extension of the seasonal benefit period, and second, the drain on the fund caused by the extension of the coverage to the fishing industry. They state in their report that it is difficult to cover the fishing industry, since in most cases there is no contract of service, and therefore the control

provisions necessary to administer the act in connection with this industry are of little value.
The loss to the fund in respect to the fishing industry is $23 million over three years. Since part of this amount was included in the $119 million depletion, they consider that the fund in respect to the depletion caused by that industry should be replenished by $12 million. This makes a total of $131 million which they recommend the government should have put into the fund last summer or fall.
We think the fund should be on a good, sound basis. The higher rates of contribution came into effect in September, 1959, and the increases agreed fairly closely with the predictions of the actuary. However, this has been offset by greater unemployment and greater claims on the fund, and the fund has gone down.
In connection with this the committee made three or four recommendations which, if and when they are presented to this house, I think will be given favourable consideration. The first is that there should be two classes at the top of the earnings range. Also there should be a readjustment and consolidation of the lower classes of earnings, and a revision of the rates of allowable earnings. They recommend that we should eliminate the wage ceiling of $4,800 and fix a higher wage ceiling to suit present conditions.
I remember what was said in the house when it was decided to cover fishermen. Last night I heard the parliamentary secretary to the Minister of Labour claim credit for his party for covering fishermen. I recall very well that at the time they were covered Mr. Harris said in the house that money should be voted from the consolidated revenue fund to meet the losses incurred because they were being covered. I hope the hon. member has now learned the truth about it and that he will not rise in the house and condemn the former government for covering fishermen. After all, it has only cost the fund about $10 million a year to give this coverage to the fishing industry, and this is a small amount when you consider the total $716 million depletion in this fund.
Certainly the loss to the fund of $66 million would more than compensate for the loss incurred in this respect over six years. If and when amendments are brought before the house-and I sincerely hope they are brought before the house this year-we on this side will pass comments on them and make suggestions. We do not know what the government are going to do, but I should like them to bring legislation forward now and not be influenced by any by-elections which lie ahead, or by any other political considerations. I would appeal to the government; let
Unemployment Insurance them cease losing money out of the fund; let them cease playing politics with money that belongs to the workers of Canada.


Harold Edward Winch: Mr. Speaker, basically what I have in mind to say on this important matter which is now before us can be said in a very few minutes and a very few sentences.
This matter of unemployment insurance is of the utmost importance to the constituency of Vancouver East. The riding of Vancouver East is a working class, residential riding. Over the past few months the workers in that constituency have been hit very, very hard by unemployment. Therefore there is a great and grave concern for all matters concerning unemployment insurance, the act itself and the regulations made thereunder.
Bluntly, I am greatly disappointed that this issue is being discussed on a political basis, that the government and the official opposition are blaming each other for what has occurred. This matter is of such importance that it should not raise political considerations of credit or discredit; it is a matter which directly affects those who are unemployed and require assistance. It must be said that unemployment insurance is not a charity. It is assistance to those who are unemployed and, under the existing law, it is available as a right because of the provisions of the law and because of the contributions made by the federal government, the employers and the employees. Since it is a right, it should not come within the realm of political discussion such as we have heard.
It is a fact that in the past two or three years the unemployment insurance fund has dropped sharply from close to a billion dollars to its present unprecedented low state. Personally I have only one approach to this matter. My concern is not with who is responsible for what has happened or with praising or condemning the official opposition. My concern is to draw one fact to the attention of the government, which has the authority to act. It is this. The unemployed who are willing to work and available to work must be assured that there is sufficient money in the fund to take care of them if they are not able to obtain employment.
So, regardless of the mistakes of the past, and no matter whether the Minister of Finance has betrayed the people in connection with his bond issues, making them worth less than they were at the time of purchase, there seems to me to be only one matter of importance to discuss. If this government, with its authority and ability to bring forward legislation, is not able to supply employment to those who are able and willing to work, then there must be sufficient money in the unemployment insurance fund to take care of

Unemployment Insurance those who cannot find jobs. That is the responsibility of the government, and that is the only thing with which I am now concerned as the representative of Vancouver East, where there have been so many unemployed in the past and where there are so many unemployed at the present time.
This is not simply a request. I do not like the word "demand", but I say this is a demand that the government accept its responsibilities, since this is clearly a responsibility of an administration which has made certain changes in the law in the past and under whose direction since 1957 we have come from a high point to a unprecedented low. I say that because of the trust placed in this government by the workers in 1957 and 1958, particularly in 1958, the government now has a duty to build up the fund so that in conditions of unemployment-and I think these, unfortunately, are a foregone conclusion-there are the facilities and the finances to tide these people over on a decent and reasonable basis until jobs are available.
One could speak, for half an hour, an hour, or longer on this issue of unemployment insurance, but I do not think anyone, regardless of how long he spoke, could put the issue more clearly. In a few moments, therefore, I intend to resume my seat. I will simply repeat that if these men cannot secure employment, after the promises that have been made them, it is up to the government, through financing and through legislation, to ensure to all the unemployed of Canada that the money is available to care for them on the best possible, reasonable actuarial basis.
On this note I intend to resume my seat, anticipating that the government will announce today or in the immediate future plans which will meet these requirements. If it should fail to do so, then it will have to accept responsibility for betraying the trust of those who voted for it and who sent over 200 of its supporters here at the last election.


Michael Starr: I have had the opportunity, today and yesterday, of listening to hon. members speaking on this motion to go into supply and on the amendment and the subamendment which have been submitted.
It seems to me that the main charge which most opposition speakers have laid against the government is that there has been mismanagement of the fund and mismanagement of the Unemployment Insurance Act. I want to say here and now there has been no mismanagement of the fund; there has been no mismanagement of the Unemployment Insurance Act. In the past, when bonds held by the unemployment insurance commission

were sold, prior to the time this government took office, there were always losses on the sale of bonds.


An hon. Member:: Profits.


Michael Starr: There were losses of the sale of bonds during that period of time.


Paul Joseph James Martin: These were forced losses; that is the difference.


Michael Starr: As far as the act itself is concerned, the act was passed by parliament, and the amendments which have been introduced to that act have also been passed by parliament. I want to say that at no time, to my knowledge, has there been any mismanagement on the part of the administration of the unemployment insurance commission. They have always endeavoured to adhere strictly to the letter of the act and, as I said, that act was passed and approved by parliament itself.
It was interesting to hear the hon. member for Welland observe last evening, in effect, that the unemployment insurance fund had been used as a relief fund, intimating that people who should not be doing so were drawing unemployment insurance. The suggestion was that they should be taken care of in some other way, in other words that they should be on welfare relief. That is not the way this government has looked at this situation. The unemployment insurance fund is a matter of deep concern to this government, and that is evident from the fact that in the speech from the throne it was stated that amendments would be brought in to strengthen and build up the fund.
I am sorry to disappoint the hon. member for Welland, who may have thought, as he intimated, that this government did not intend to bring about any amendments to the act. These amendments are now being worked on. This is a difficult problem which has to be gone into in every detail, and entails a great deal of study. We will be bringing in these amendments, as we have said, because the state of the fund is of more concern to the government than to any member of the opposition.


Paul Joseph James Martin: Oh, oh.


Michael Starr: I have listened to the hon. members of the opposition with the hope, because of the impression they have created as to their interest in the fund, that as responsible members of parliament they would come forward with their own suggestions regarding what could be done to strengthen the fund. The only suggestions I have heard from those hon. members is that we should enlarge the scope of the fund, that we should pay out more money to casual employees, and possibly take

money from the federal treasury to replenish the fund without endeavouring to bring it back within the insurance principles under which it was set up originally.
When we took office in 1957 it was quite evident that unemployment was on the rise, and that the former government had been warned by the economists that this unemployment situation was in the offing.


John Whitney Pickersgill: Mr. Chairman, would the minister permit a question in this regard? He said the former government had been warned, and I wonder whether the minister could say when he discovered that the former government was warned.


Michael Starr: Mr. Chairman, there was ample evidence of that when the Prime Minister produced the report which had been handed to that former government in the early part of 1957 but which was hidden at all times by the former government because it did not want to act upon it.
The fund was built up to some $940 million. It was the purpose originally to build up the fund. When I came into this house as a member in 1952 I had the opportunity of serving on the standing committee on industrial relations, and many times as a member of the opposition in that standing committee I urged the government to enlarge the scope of the Unemployment Insurance Act. I pointed out that the fund had been built up to close to $1 billion and that the people themselves should receive some benefit as a result.
We were told time and time again that the purpose of building up that fund was to take care of any unemployment situation that might arise. When we ascertained that unemployment was on the rise we felt, as a government with humanitarian instincts, that we should do something in the way of providing for individuals who found themselves unemployed for a certain period of time. To alleviate the unemployment situation we brought in amendments to the act, providing higher benefits by the establishment of two higher categories.
Up until that time the Unemployment Insurance Act provided for a maximum benefit of $30 per week. We established two new categories which provided for $33 per week and $36 per week, related to the contributions made by the employees, for a total period of 104 weeks. We felt we would give incentive to individuals to work by raising the allowable earnings, and we did so to the extent of 50 per cent of the benefits. In other words, a person receiving the highest benefit of $36 per week was entitled to earn $18 through part time employment during that week without any infringement upon his
Unemployment Insurance benefit. The individual was given the opportunity of receiving a total of $54 a week in the highest category.
The former government had cut down the period of benefits to 36 weeks. We decided to raise this period to 52 weeks. In the United States the federal government is going to increase the unemployment benefit period by 13 weeks, which means that the longest period an individual in the United States can draw unemployment insurance is 39 weeks. In comparison, an individual in Canada can regularly draw benefits, providing the individual qualifies, for 52 weeks and, with the addition of seasonal benefits, for a total period of 76 weeks.
Under the former administration married women came under the regulations but not under the act, and did not receive the same privileges as male employees. We remedied that situation by bringing married women under the act, providing them with the same benefits and opportunities as male employees. We also brought fishermen under the act.


John Whitney Pickersgill: On what date?


Michael Starr: Fishermen commenced to receive benefits under the act on December 1. Under the former administration they would have commenced to receive benefits on January 1. They in fact began to receive these benefits one month earlier than they would have.
This government gave consideration, at the same time, to seasonal benefits, which were available from January 1 to April 15. We had always in opposition advocated that these seasonal benefits should be extended from January 1 to May 15, giving an extra four weeks' benefit. However, this government went further even than that. The allowable period for seasonal benefits is now from December 1 to May 15, representing an increase of two months. In 1958 we further extended that period, in respect of one year only, by the addition of six weeks.
Regular benefits are based on the formula of two contributions for one benefit. Seasonal benefits were based on the same formula. We changed that formula in order to make it easier for individuals to qualify in respect of seasonal benefits. We changed the two for one formula and extended the seasonal benefits, so an individual can now draw five benefits for every six contributions. All these benefits, which are in effect now, were designed to benefit the working men and women of this country. I submit they have been of tremendous help to the individuals in this country who have been unemployed.
The hon. member for Assiniboia-and I need not remind hon. members that he is an aspirant for the leadership of the New party,
4552	HOUSE OF
Unemployment Insurance which is supposed to represent the working force of this country-yesterday charged that this government had pilfered the fund by doing the things it had done, and suggested that as the only reason the fund is at its present level. He charged that this government had pilfered the fund in order to bring forward these unemployment insurance benefits to which I have referred.
In view of this charge I am doubtful whether that hon. member is working on behalf of the working force, or whether he would be willing to do the things this government has done to the benefit of that working force. It has been suggested that we should protect the fund. No one has yet suggested what method in his opinion should be implemented to protect the fund and how it should be done.


Paul Joseph James Martin: By not imposing an obligation to sell government securities at a loss.


Michael Starr: Speakers on that side of the house have all said so far that whatever action the government will endeavour to implement by way of amendments to the Unemployment Insurance Act they will resist vigorously. That has been their position so far in this debate. "Whatever you try to do we will resist it vigorously".


Hédard-J. Robichaud: Provide work and the fund will be sound.


Michael Starr: The hon. member for Gloucester (Mr. Robichaud) says "provide work". If the Speaker would permit me to go beyond the scope of the amendment I would be only too glad to list item by item and in detail the 23 measures that the government has taken since November 23 to provide work, measures that are taking effect now and will continue to take effect. However, I am afraid the Speaker would not permit me to go beyond the scope of the amendment.


Mr. Ricard:: More people are working now than ever before.


Michael Starr: The charge has been made that the government has failed to act on the recommendations contained in the report of the unemployment insurance advisory committee. What part do hon. members advocate that we should implement? The part respecting fishermen? The hon. member for Gloucester says that nothing should be done in that regard and I am sure the hon. member for Bonavista-Twillingate (Mr. Pickers-gill) would not be in favour of doing anything about it. What part of that report should be implemented? I am anxious to hear that. I am anxious to hear what responsibility members of the opposition have, whether


they are prepared to say, "Here are our recommendations. This is what you should do. You should carry out all of it or just part." No one has said yet what part of these recommendations should be implemented.
At this point I will just mention in passing the matter of contracts of service and casual employment, and I will deal with it in more detail later. The hon. member for Gloucester has brought this matter to the attention of the house on a number of occasions. I want to point out to him that those persons who have employed people to fix their verandas or to paint the exteriors of their houses are not employers in the sense that they are registered as employers in the national employment service offices. They have been able to purchase unemployment insurance stamps without any check at the post offices throughout the country. No auditor from the unemployment insurance commission has been able to check on the validity of these purchases and the validity of the stamps that have been put into the books of those employed by such people because these people have no records. They have no payrolls. Nothing is kept. This has been a haphazard type of thing that had to be rectified.


Hédard-J. Robichaud: Not in all cases.


Michael Starr: When the hon. member for Gloucester drew the attention of the unemployment insurance commission to a case he was advised that the appeal with respect to that case would be heard by the commission. He was advised that he had the opportunity to appear in order to speak on behalf of the people involved. He refused to do so.


Hédard-J. Robichaud: On a question of privilege, Mr. Speaker, I think the minister's statement should be corrected because in only one instance was I asked by the unemployment insurance commission to attend an appeal and as I was 800 miles away from Ottawa I simply could not be there.


Michael Starr: I referred to only one instance and if I said that the hon. member refused to do so I will withdraw that and modify it by saying that he did not appear.


Hédard-J. Robichaud: That is more like it.


Michael Starr: We are now in the second day of discussion of another of those weak-kneed, wishy-washy, futile and frustrating amendments of Her Majesty's loyal Liberal opposition, and one minute's study of this amendment will reveal that it means absolutely nothing. I think this is another step, Mr. Speaker, and a backward one at that, in the constant effort to convince the country that

disaster is inevitable unless a Liberal administration is installed. Personally I cannot think of a more inevitable way to ensure disaster in this country.


Paul Joseph James Martin: You do not believe that.


Michael Starr: I certainly do.


Paul Joseph James Martin: Oh, no, you do not.


Michael Starr: Mr. Speaker, if the criterion is the negative, destructive and barren way in which they have approached every single measure brought forward by the government since November 17, I submit this country has little hope of anything from the Liberal party in the future. I am only guessing, Mr. Speaker, but from the notes that are being written on the desk of the hon. member for Essex East I think that in a little while we will once again be treated to the posturing and viewing with alarm of the hon. and doom-ridden member for Essex East. I think he will trot out all the arguments he has trotted out in the past, which are nothing but a tossed salad of verbiage so very dear to his heart-


Paul Joseph James Martin: Repeat that. It is a good epigram.


Michael Starr: -about mismanagement of the fund, which is his favourite topic.


Paul Joseph James Martin: One of the most disgraceful episodes of the government.


Michael Starr: He will talk about mismanagement by the investment committee.


Paul Joseph James Martin: Forced on it by the government's financial policy and conditions of unemployment.


Michael Starr: Incidentally, all but one member of that committee were appointed by the former government.


John Whitney Pickersgill: What does that prove?


Hédard-J. Robichaud: They are responsible to the present government.


Michael Starr: If they were responsible when the Liberal government was in power, they are certainly the same people and are just as responsible now.


Paul Joseph James Martin: May I ask the
minister a question? Will he tell us of any incident under the former government where the investment committee was ever faced with the problem that faced it under this government involving as it did a conflict of interests because of the bond conversion policy of the present government?
Unemployment Insurance


Michael Starr: The investment committee certainly has had to sell more bonds because we know that the fund is depleted and the only way it could be developed to the point where it is was by the sale of these bonds that were held.


Paul Joseph James Martin: What about the trust fund?


Michael Starr: Losses were also incurred in previous years when bonds were sold. I am sure that when the hon. member for Essex East rises to speak he will begin wheeling and dealing in his usual fashion and will come out with his statistics involving millions and tens of millions of dollars. I would not advise anyone to try to check the figures produced by the hon. member for Essex East from time to time. This is the 101st day of the session and up to now the government has brought in some 23 measures to combat unemployment and to stabilize the economy. During the whole session practically all of the actions of the government have been directed toward that end. Every one of these positive and beneficial measures has been strenuously opposed by members of the opposition.


John Whitney Pickersgill: That is not true.


Michael Starr: In the end, of course, they voted for them when a vote was forced.
Let us look at Hansard and see what these spokesmen for the Liberal party particularly have had to say about the measures we have introduced. Let us look at the amendment, Mr. Speaker, which they have placed before this house. It reads:
This house regrets the failure of the government to ensure sound administration of the Unemployment Insurance Act, resulting in the depletion of the financial resources of the fund and new arbitrary administrative procedures which deny benefits to casual employees.
This is the whole of the amendment. I submit to you, sir, this amendment demands close scrutiny. In the first place, since the amendment was put forward by a supposedly responsible opposition, it shows an alarming ignorance of the structure of the administration and of the Unemployment Insurance Act itself. In so far as the administration of the fund is concerned, as I have pointed out earlier it is the same administration as has always been there. The investment committee is the same, with the addition of only one new member. The structure is the same. The fund is administered by a commission, as it has always been, and there is nothing new in the administration.
What does this amendment actually mean, Mr. Speaker? The amendment says, in effect, when you clear away all the verbiage, that the fund has been depleted and the government is to blame; that is the sum of the

Unemployment Insurance amendment. At the same time, this peculiarly contradictory amendment accuses us of taking steps to prevent the depletion of the fund by denying benefits to casual employees. The hon. member for Gloucester claimed yesterday this is something new. I can only say that if those who framed this amendment had even a nodding acquaintance with this act they would know that casual employment is specifically excepted from eligibility for insurance under this act.
I refer to section 27, paragraph (p), which reads as follows:
Excepted employment is
(p) employment of a casual nature otherwise than for the purpose of the employer's trade or business;
I am informed, Mr. Speaker, that this section has been a part of the act ever since the act came into being. Now, all of a sudden the opposition discovers it and says, this is something new. The interpretation of this section, of course, is left to the commission; that is their business. The minister has no jurisdiction. The last recourse in this respect is the umpire. A recent decision of the umpire, and not the first of its kind I might point out, has confirmed the commission's interpretation of this section. I submit to you, therefore, that any suggestion that some new and sinister device has been introduced to deprive casual employees of benefits falls immediately by the wayside. I will go this far, Mr. Speaker, and say the act is now being enforced as perhaps was not the case in the past in respect of this matter. The enforcement is being applied without any partisan basis.
This is all that is in the amendment. It is contradictory as my parliamentary secretary pointed out last night. The amendment says that we have depleted the fund and then suggests that we should go against the provisions of the act by making benefits available for casual labour. This amendment may meet the requirements of the rules, but it certainly does not meet the requirements of common sense. I say this amendment is another calculated effort by the opposition to spread doom and gloom. How different is the situation in the United States from the one here. The outlook of the people is different, and there is no talk of gloom and disaster in that country. They are now saying they are on their way out of the recession; that is the talk in the United States. No one is going around spreading this philosophy of doom and gloom. They have faith in their country, and they are not trying to bring down the economy by spreading this sort of thing.
I should like to say this, Mr. Speaker. In yesterday's Toronto daily Star there appeared a headline on the business page which said:

"U.S. Hope Soars Recession Over." There is no gloom and doom there. Then, the article goes on to say this:
Rising automobile sales, increased steel production, a decline in unemployment, an improvement in sales of major appliances, a gain in manufacturers' new orders and sales, and an increase in instalment credit were in evidence.
These signs of a pick-up in the economy of the United States are being reflected here. When I was in Washington recently I did not solicit this information but I was told that even though we had gone into the recession earlier than the United States, there was every evidence they could see that we were coming out of that recession sooner than the United States. I mention this because it relates directly to the subamendment moved by the group to your immediate left, Mr. Speaker. They accuse the government of failing to give consideration to the reimbursement of the fund from the public treasury to take care of the excessive depletion it has suffered as a consequence of the recent abnormal unemployment.
In the first place I would submit, knowing that you have accepted this amendment, Mr. Speaker, that the amendment is not in accordance with the facts. The government has given consideration and is giving consideration to this matter as well as to other matters relating to the fund and the employment situation in general. There is plenty of evidence to that effect. As was pointed out by my parliamentary secretary last night, these are matters of policy which will be announced when decisions have been confirmed. I find it difficult to believe this amendment means what it says. Hon. members are criticizing the government for failing to give consideration, and this is hardly a motion of substance. What it means, if it means anything, is that they are telling the government to reimburse the fund from the public treasury. I am not arguing the point of order because you, sir, have accepted the subamendment, and I merely wish to deal with the meaning of this subamendment in the way which is open to me to reply to it.
I can only say that consideration is being given, in so far as the first part of the subamendment is concerned. In so far as the second part of the subamendment is concerned, there is a reference to the recent abnormal unemployment. This is just another means of getting back to the same old record. The hon. member for Gloucester said last night that the real reason for the depletion of the fund was the fact that people were unemployed. I think he repeated that this afternoon in his interjection. Then we listened to the hon. member for Welland (Mr. McMillan) who criticized us for taking money

from the fund in order to help people over difficult times. Let me ask this question. What does he think the fund is for? At the beginning of my remarks this afternoon I said that the fund was to help people, to tide them over a period of unemployment. We make and have made no distinction between those whom we feel are or are not entitled. The people who are drawing unemployment insurance are, in our estimation, entitled to it. Certainly we do not feel that they should be pushed aside out of the unemployment insurance fund and required to go on relief, as the hon. member suggested-


John Whitney Pickersgill: That is just what you have been doing.


Michael Starr: -and as the hon. member for Welland stated should be done. As a matter of fact, the hon. member for Welland placed himself in the position of talking against his own party's amendment which criticized us for denying benefits to casual employees. However, this is typical of the confusion that exists in the ranks of the Liberal members in this house.
In both the amendment and the subamendment mention was made of the depletion of the fund. Surely no one would imagine that the government is not aware of this fact- certainly we are aware of it-or that the government is not giving close care and attention to this matter. We mentioned it in the throne speech when it was read on November 17.


John Whitney Pickersgill: And that is the last we heard of it.


Michael Starr: Depletion of the fund is dealt with in the last report of the unemployment insurance advisory committee covering the fiscal period ending March 31. That report points to the extension of seasonal benefits as one of the major drains on the fund. This was done, Mr. Speaker. We extended these seasonal benefits. It was necessary to take this action at the time, as the committee itself recognizes when in its report it goes on to say this:
This large sum has been distributed in relatively small amounts. It has been the means of relieving economic distress, through unemployment, of millions of individuals and their families.
The unemployment insurance advisory committee does not criticize the government for delivering economic distress. It is left for the opposition to do that. The committee merely points out that this is what has been done and it makes certain recommendations. Those recommendations are under consideration by the government. Certainly there has not been from the opposition any indication as to whether the government should adopt all of these recommendations or part of them.
Unemployment Insurance The results of that consideration which the government is now giving to those recommendations and others will be evident when the amendments to the act are brought down in this house.
There is also mention of the cost of benefits for fishermen. The hon. member for Gloucester has carefully studied that section of the report, I am sure; yet there was from him no suggestion that fishermen should not be eligible to receive benefits, and I repeat that statement. Earlier in my remarks I said -and I repeat it-that he has not said anything about that matter. He has not said that they should not be included under the act.


Hédard-J. Robichaud: What I said is on the record.


Michael Starr: Yes, but the hon. member also said that we should adopt the recommendations of the unemployment advisory committee, and that is one of the major points of the recommendations.


An hon. Member:: He nailed you there.


Michael Starr: We have not heard from the hon. member for Bonavista-Twillingate (Mr. Pickersgill) as yet. I will wait with interest to find out whether such a suggestion is forthcoming from him as to whether we should implement the report of the unemployment insurance advisory committee or part of it; and if so, what part. As a matter of fact, a careful study of the report of the advisory committee leads to only one conclusion, namely that the situation cannot be met simply by merely appropriating money through parliament to meet the payments from the fund. It is evident that what is required is a careful review of the act, something which we are undertaking with the officials of the unemployment insurance commission and with others, with a view to incorporating amendments that will restore the full effectiveness of the scheme.
This is the government's responsibility. This is what the government has been doing. It is not, I submit to you, Mr. Speaker, something that can be done overnight. I should like to get it done as quickly as possible. I know that by nature I am an impatient person but I find that in this case this thing cannot be done overnight or in a hurry. It must be done carefully. A great many factors must be weighed in making the decisions with respect to the amendments to this act and they must be given careful study. This is matter of government policy and it is not to be decided, I submit, at a time or in a way determined by the opposition. I may say that it is generally recognized that the greatest single drain on the fund has been the seasonal benefit provision under the act. This was introduced by

Unemployment Insurance the former government in 1950. We extended it by two months. We changed the formula. I believe that the amendment at that time was piloted through by the hon. member for Essex East,-


Paul Joseph James Martin: That is right.


Michael Starr: -who was then acting on behalf of the then minister of labour.


Paul Joseph James Martin: We never had unemployment as this government has had it.


J.-H.-Théogène Ricard: You mean horses were on the payroll?


Michael Starr: In the circumstances, Mr. Speaker, I feel that it ill behooves hon. members opposite at this time to talk and act as though they had never heard of these things. We extended this provision; and I am not worried about saying that. I think we did a great deal of good by it. We helped people through a trying period. We did it when hardships were in prospect as the result of a continent wide recession, not one just confined to Canada.


Paul Joseph James Martin: Twelve per cent in this country; 8 per cent in the United States.


Michael Starr: Now they tell us we should further extend the act by including casual labour. The hon. member for Essex East just interjected percentages. I wonder whether he has studied-


Mr. Deputy Speaker:: Order. I am sorry to interrupt the minister but I must inform him that his time has expired.


John Whitney Pickersgill: Surely, the minister has unlimited time. He is the minister replying.


Mr. Deputy Speaker:: If there is no objection, the minister may continue.


John Whitney Pickersgill: Let the minister continue.


Paul Joseph James Martin: But not to an unlimited extent.


An hon. Member:: Stick together, boys.


Michael Starr: The hon. member for Essex East just interjected percentages. I did not catch the full impact of those percentages.


Paul Joseph James Martin: I said-


Michael Starr: It does not matter.


Paul Joseph James Martin: What I said was that in Canada-


Michael Starr: It does not matter. I wish to point out to the hon. member that, in those states on the borders of Canada having the same climatic conditions as we have here in Canada, the percentage of unemployment is

far greater than is the national average in this country and more than double what it is in Ontario.


J.-H.-Théogène Ricard: Under a good Conservative government.


Paul Joseph James Martin: Let us not worry about that. Let us do something here at home.


Some hon. Members:: Oh, oh.


Michael Starr: If the hon. member would permit me to take the time of the house in order to go into detail and to enumerate and discuss in full detail the measures this government has taken since November 17, I should be only too glad to put them on the record since he has now made the remark "let us go ahead and do something about it" and has asked what the government has done.


Paul Joseph James Martin: We know what you have done, and you have done very little. It is a disgrace.


Michael Starr: I will confine myself to the amendments. Both these amendments are designed to bring forward the question of unemployment, and at the same time deprive the government of the opportunity of saying what is being done about it, as I said a moment ago.
The C.C.F. subamendment talks about "abnormal unemployment". These are the words you will find in their subamendment. Any substantial unemployment is abnormal as far as this government is concerned, and we are taking the most far-reaching steps ever taken in the economic history of this country by any government since confederation to deal with it.
As an example, in the present fiscal year we are providing for expenditures of more than $742 million in government acquisition and construction to help the economic situation. I submit this will help to deal with abnormal unemployment. I am directing my remarks only to the words which appear in the subamendment.
There are other encouraging items in the daily press which will have their effect on abnormal unemployment as referred to in the subamendment. Again, from last night's Toronto Daily Star which as all hon. members know makes a habit of stressing the brighter side of the news as far as this government is concerned, there is an article which says:
From Vancouver-a $76 million copper order from Japan for British Columbia.
This will have an effect on abnormal unemployment.


Harold Edward Winch: Starting when?


Michael Starr: I have not the details here, but I shall be glad to get them for the hon. member.


Harold Edward Winch: It will not be in operation for 14 months.


Michael Starr: That is fine; that may be so. It is for the future. But surely the hon. member would not discount that.


Harold Edward Winch: No, I accept it willingly, but you are talking about the subamendment and the abnormal unemployment situation which now exists.


Michael Starr: I am talking about the abnormal unemployment situation as it may exist at the moment. These things will help to alleviate that situation.


Hazen Robert Argue: You mean that unemployment will still be here 14 months from now?


Michael Starr: Other things will also help the situation now. This news story also refers to more than $200 million in long term contracts for British Columbia mining products. This, too, will have beneficial results in so far as abnormal unemployment is concerned.
Let me say that the shipping employment provided under the tremendous wheat sale to China will help to eat into the "abnormal unemployment" mentioned in the subamendment. I am still dealing with the matter of abnormal unemployment referred to in the C.C.F. subamendment.
From last night's Citizen, another purveyor of the bright side of the news, we have this item, which will have an effect on abnormal unemployment.


John Whitney Pickersgill: Mr. Speaker, I rose on a point of order a few moments ago to point out that the minister had the undoubted right to speak as long as he wishes. I think Your Honour recognizes that he has this right under standing order 31.
Therefore even my intervention now is not taking away from his time. But since hon. members on this side of the house would like an opportunity to reply to the minister's arguments, I wonder whether the reading of newspaper clippings or stories which really have no relation to the motion is quite relevant. So long as Your Honour is willing to give the same indulgence to other hon. members, as I have indicated two or three times before, we on this side of the house are quite happy.


Michael Starr: Mr. Speaker, I am not reading newspaper clippings; I am referring to news stories which have recently appeared in newspapers and which I submit will have an effect
Unemployment Insurance upon the charge made in the C.C.F. subamendment when they speak about abnormal unemployment. Those words are in the subamendment.
This is the charge being made against the government, and I want to say that all is not doom and gloom; there is a brighter side. It is not something that we, the government, are putting forward and trying to ram down their throats, but rather it is a disinterested viewpoint of what is being done in Canada and what is happening to help this situation.


Mr. Deputy Speaker:: I cannot accept the view that because the subamendment contains the words "recent abnormal unemployment" it is permissible to discuss unemployment.
I may say that in my view relevancy may sometimes be more a method of speaking than the choosing of the subject for a speech. I think the hon. minister was not always relating his remarks to either the amendment or the subamendment.
The subamendment, in fact, deals with the suggestion that the government should have considered the reimbursement of the fund from the public treasury because of its excessive depletion.
Abnormal unemployment would be only a cause of the depletion of the fund, and really the subject matter of the subamendment is restricted to the reimbursement of the fund from the public treasury because of its excessive depletion.
Therefore if I think in some ways unemployment could be related to the subject matter of the amendment or the subamendment, I do not think it would be related in the way the minister has proceeded up to this time. In fact, I would say unemployment has also very little to do with the main amendment, because the main amendment concerns only the matter of the administration of the Unemployment Insurance Act. Maybe, it excludes unemployment.


Michael Starr: I will abide by your ruling, Mr. Speaker. I had many other things to mention which are happening in this country and will take care of abnormal unemployment. Therefore there is no necessity for us to be steeped in doom and gloom; rather, I think there are indications of a brighter side in our economy for the future.
There has been an indication of this from even the Leader of the Opposition (Mr. Pearson). The leader of the Liberal party changed his outlook a few weeks ago. He now feels that an upsurge in the economy is just around the corner. But he is guarded in this respect, because he says, "Of course, it will not be because of anything this government has done".


John Whitney Pickersgill: That is certainly right.

Unemployment Insurance


Michael Starr: I ask this, Mr. Speaker. Is it because of the gloomy predictions of the opposition that the economy is on the upturn? No, certainly not. It is because of the actions of this government; it is because the actions of certain people in this country who have faith and hope in this country are bringing it out of the recession. This will come about regardless of the doom and gloom the Liberal party is spreading around in the hope it will have the desired effect, which is to bring the economy down.
Even the hon. member for Essex East (Mr. Martin)-that great prophet of good times and good cheer-said this in his usual buoyant and optimistic way:
I would hope It is an indication that forces of growth are present that might lead to an end of the recession-


Paul Joseph James Martin: Hear, hear.


John Whitney Pickersgill: Hear, hear.


Paul Joseph James Martin: They were very good words.


Michael Starr: He, too, can now see that the actions of this government and the measures which have been taken by this government are bringing about results and will bring about greater results in the months and years ahead.
The hon. member has no alternative but to turn around and admit it, as he has done in the past. I hope he will do so in the future, because I think the future of this country and its economy is much greater than he or I.


Paul Joseph James Martin: I agree, because we will have a new government pretty soon.


Hédard-J. Robichaud: Not a new vision, but a new government.


J.-H.-Théogène Ricard: You hope.


Michael Starr: I should say, Mr. Speaker, that no government has ever worked as hard as the present government to bring about this buoyancy in our economy.


John Whitney Pickersgill: Eighteen hours a day.


Michael Starr: There are more people working today than ever before. Those same people are earning more, spending more and saving more money than ever before in the history of this country. I will say, as did my colleague the Postmaster General (Mr. Hamilton) that there are 500,000 more Canadians working today than there were when the Liberals were put out of office.
I would also point out to hon. members opposite that you cannot deal with unemployment in terms of actuarial considerations alone. We are dealing with men and women, Canadian citizens bringing up their children,


sending their children to school. These are the people with whom we are dealing and we are very conscious of it. If I must choose between actuarial considerations and the alleviation of misery for Canadians, my decision will always be in favour of those Canadians.


John Whitney Pickersgill: I know it is going to be a bitter disappointment to the Minister of Labour (Mr. Starr) that his prognostication as to who would follow him has turned out to be wrong, and instead of listening to the eloquence of the hon. member for Essex East (Mr. Martin) he is going to listen to the faltering words of the hon. member for Bonavista-Twillingate.


Michael Starr: I am disappointed.


John Whitney Pickersgill: I am sure the minister is disappointed, but I hope his disappointment will not be too long sustained. Before I deal with some of the things the minister said, I want to refer to an exceedingly naive observation made last evening by the parliamentary secretary to the minister (Mr. Thrasher) at the very opening of his remarks, because these words appear most strange to me after all the resounding declarations about the rights of parliament and especially the rights of the opposition which we used to hear from the Prime Minister (Mr. Diefen-baker). Said the parliamentary secretary as reported at page 4522 of Hansard:
Mr. Speaker, once again we find the opposition introducing an amendment to a motion to go into supply under a guise that is purposely designed to permit them to make an attack on government policy-


Some hon. Members:: Read on.


John Whitney Pickersgill: I shall be happy to read on. It continues:
-on government policy with regard to employment in this country.


An hon. Member:: Nothing to do with the amendment.


John Whitney Pickersgill: What, may I ask, does the hon. gentleman think parliament is for? What does he think an opposition is for? Does he think that we on this side of the house, like the hon. gentleman and those around him, are a lot of rubber stamps or "yes" men or trained seals? Did the hon. gentleman wish to intervene?


Mr. Thrasher:: I was wondering whether the hon. gentleman wished to have an answer to the question he just posed?


John Whitney Pickersgill: My question was a purely rhetorical one and I leave the hon. gentleman to make any kind of answer that his essay writer is able to think up for him.

The Minister of Labour suggested that there was a contradiction in the amendment moved by the official opposition. Perhaps I might deal with that point before going on to deal with the other points made by the hon. gentleman. There is no contradiction. The plain fact is that there is a historical evolution. As the hon. member for Welland (Mr. McMillan) pointed out last night, the government in 1958 amended the act to provide for very greatly increased disbursements from the fund without making any provision for the replenishment of the fund. We condemned them at that time. We said that was an unsound policy, and we have repeated it on every occasion since. If the government had listened to us then, the fund would not now be in the precarious state in which it finds itself at the present time.


An hon. Member:: They got their benefits increased.


John Whitney Pickersgill: We did not oppose those benefits at any time. We oppose the conditions which brought about the increase in winter unemployment, dragging on into June of one year. We did not oppose the benefits, having regard to those conditions. But, we said, you have to be provident; you have to provide the money out of which to pay those benefits; you have no right to take money out of this actuarial fund by these unactuarial additions to it. That is our whole point. We have no objection to any of these benefits. Indeed, we are opposed altogether to driving people off the fund and putting them on relief.
But what happened? Last fall the condition of this fund began to worry the government. It should have worried them three years ago but at last they woke up to the fact that the position was serious. What did they do? In the guise of following strict insurance principles they looked around for the loopholes to get people off the fund and throw them on to relief. My hon. friend from Gloucester (Mr. Robichaud), my hon. friend from Beauce (Mr. Racine) and my hon. friend from Grand Falls-White Bay-Labrador (Mr. Granger) all pointed out last night that this is what happened. Work of a certain type was called casual employment. The work of carpenters employed by householders without there being a middleman was deemed to be outside the provisions of the act. Surely this is one of the last actions which one could have expected from a government which was urging us to "do it now" and encourage winter employment.
This decision had the result of discouraging employment. That is what they did, and that is what they are doing. Why? Because they are in a panic about the state of the
Unemployment Insurance fund. They did not take action of this kind in 1958 or in 1959. It was only in 1960 that this interpretation was introduced. Of course, when the case got to the umpire, the umpire had no choice but to make a strict interpretation. But there was never any need for it to have been taken before the umpire. It never should have been taken to the umpire, and since it was taken to the umpire- and the decision was made on February 3-* the government should have had its bill in on February 4 or February 5 to correct the situation and see that protection continued to be given to those people who were working in good faith believing that the law which had been on the statute books since 1941 would continue to be administered in the same way as in the past.
There is no contradiction at all involved in the amendment. We are concerned about the depletion of the fund. Everyone is concerned about that, but the way in which to avoid the further depletion of the fund is not to cut off from benefit a group of people who have always been insured in the past. The way to deal with the situation is to find a sensible and stable means of replenishing the fund. But much more important even than that, is to get back to the kind of full employment we had in this country from 1945 to 1957. In all those years nobody worried about the state of the unemployment insurance fund. Nobody had any need to worry about it.


Mr. Macdonnell:: Does the hon. gentleman seriously ask us to believe that he and his colleagues were responsible for the fact that unemployment was less in those years?


John Whitney Pickersgill: Well, the hon. gentleman did not protest five minutes ago when the Minister of Labour was claiming that the present government was responsible for the end of a recession which has not yet come. Oh no. He is only too happy to let his colleague claim that. But when we suggest that Mr. Mackenzie King in 1945 appealed to the people of this country to put his government back in power on a policy of full employment, and that for 12 years afterwards there was full employment, and that there is some connection between those two facts, the hon. gentleman rises to object. As Mr. St. Laurent used to say, maybe it is a coincidence. But it has just so happened that ever since 1896 every time there has been a Liberal government in this country, the nation has grown and developed, and every time there has been a Tory government there has been stagnation. That is a historical truth.


Mr. Maclnnis:: May I ask the hon. member a question?

Unemployment Insurance


John Whitney Pickersgill: Mr. Speaker, I will take my 40 minutes and then the hon. gentleman can ask his question.
The minister said in the course of his remarks that the previous government had been warned in 1957 that the unemployment situation was coming. The minister chose to refer to this subject and I am sure Your Honour will not restrict me from doing the same. I asked him when the government had received that warning and he dodged the question. I know very well why he dodged it: because he remembered that on December 10, 1957, just six months after he came into office he said that there is hardly an economist or a student of the situation who does not feel that the unemployment situation is merely temporary and that, given a brief breathing pause, the natural buoyancy of the economy will assert itself. That is what the minister had to say on December 10. Was the minister that inept or blind?
Both Mr. Harris and the leader of the opposition had been warned in June that the unemployment situation was coming, but what did this collection of brilliant statesmen who had been in office six months have to say about this? After six months in office they had this to say, and I think it is worth repeating; "There is hardly an economist or a student of the situation who does not feel that the unemployment situation is merely temporary and that, given a brief breathing pause, the natural buoyancy of the economy will assert itself". A month and ten days later the Prime Minister had that apocalyptic vision in this house on January 20, 1958 and put forward carefully selected extracts from a document which, by all the conventions of our British parliamentary institution should never have been used in the way he used it, and created an impression which was totally out of accord with the facts, and out of accord with what the Minister of Labour had said a month before.


Mr. Horner (Acadia):: Is it still hurting?


John Whitney Pickersgill: I am not suggesting the unemployment situation is hurting the Liberal party today, but it is hurting that party which has been in power for four of the longest years we have experienced in Canada in recent times.


Mr. Deputy Speaker:: I think I should remind the hon. member that I do not object to his answering arguments or statements made by the minister or other speakers, but I suggest that his answer should be short rather than of a type which would detract from the subject of the amendment. I indicated before it is my view that the unemployment situation cannot be the subject matter of the

amendment because there is reference only to the administration of the Unemployment Insurance Act.


John Whitney Pickersgill: I promise you, sir, that I will not take any longer in respect of any of these themes than did the minister himself.
The minister complained in the same vein as did the hon. member for Vancouver-Kings-way (Mr. Browne) and the parliamentary secretary. I will not take as much time as they did.


An hon. Member:: It will seem like it though.


John Whitney Pickersgill: Yes, it will seem like a lot longer to the hon. member before I am finished, though it will not take me longer.
I should like to ask the minister what he means by gloom and doom. I am going to ask him whether he means by gloom and doom that which is indicated in this statement:
We on this side of the house hope that the government will act because there is no depression in other countries of the world. In Britain there is no such thing as serious unemployment today, the unemployment in Britain being less than half of our unemployment with a population several times greater than ours. The same condition prevails in West Germany and in other private enterprise countries.
Is that doom and gloom?


William McLean Hamilton: There is no word there decrying the Canadian conditions.


John Whitney Pickersgill: Oh, yes, the statement is that there is no other country in the world with such serious unemployment as we have in Canada. That is what is said here. I continue:
We do not believe in preaching pessimism; we do not want to see the condition of affairs brought about which will create panic; but we are asking the government to act now-
-this is not something new that has come to the attention of the government. It has been mounting for the last several years.
Is that, or is it not, doom and gloom?


Mr.   Hicard@: No.


John Whitney Pickersgill: Let me read this:
The government does not even recognize that there is serious unemployment. Unless they do recognize that fact they cannot achieve in their minds any actuality of a solution for the problem.
What a wonderfully accurate description of this government that is. I continue:
I was reading Edmund Burke the other night and I saw something that is quite fitting. He said: We can never walk surely but by being sensible of our blindness.
Is this government sensible of its own blindness? I read further:
How applicable that is to this government which is so insensible to its blindness, to its own postponing and procrastinating. It is ready to promise action some time in the future.


Mr. Chambers:: On a point of order, Mr. Speaker, under the rules I believe the hon. member has an obligation to name the author of this excellent indictment of the previous government.


John Whitney Pickersgill: If the hon. gentleman
would like the name of the author of these words regarding doom and gloom, I will identify that author in this way; he is also the author of these words which were delivered on a television program on April 12, 1961-


William McLean Hamilton: Mr. Speaker, on a point of order-


John Whitney Pickersgill: They do not like this, Mr. Speaker, and I told you they would not.


William McLean Hamilton: Mr. Speaker, on the point of order raised by the hon. member for St. Lawrence-St. George (Mr. Chambers), any hon. member quoting from a document in this house is obliged to identify directly the document and the author from which he quotes and, if the hon. member is quoting from Hansard, as I believe he is, I would ask that he give us the page, the date and the author.


John Whitney Pickersgill: Mr. Speaker, I am going to save the time of the house by reading just one or two extracts from this-


Some hon. Members:: Order.


William McLean Hamilton: Mr. Speaker, with all respect, I would ask you to enforce the rules of the house in this regard.


John Whitney Pickersgill: Mr. Speaker, on the point of order, I would also suggest it is a rule of the house that a member may read anything in the house if he makes the words his own, and I make these words my own, sir.


J.-H.-Théogène Ricard: You accept the words "doom and gloom" as your own?


John Whitney Pickersgill: In this regard I would like to point out what that hon. gentleman said, and I will read his words.


Mr. Depuly Speaker:: Order. I think the hon. member will realize he cannot have it both ways. He cannot assume the words as his own while at the same time referring to what someone else said. We are all apparently curious to have the individual identified.


John Whitney Pickersgill: The gentleman who said that, sir, was then a private member sitting on this side of the house from the constituency of Prince Albert, and is today the Prime Minister of this country. Those words of doom and gloom were uttered during the one period of temporary seasonal unemployment of a serious character during that period.
Unemployment Insurance


Some hon. Members:: Oh, oh.


John Whitney Pickersgill: I know that the hon. gentlemen do not like their leader's record exposed to the public, but would rather only have his visions exposed. They do not want to see their leader in the rags and tatters of another day. Their leader needs a new suit now, and needs one a great deal more than the country does. What this country needs is a new government. I would draw your attention to the words which were then expressed in that kind of statement to which, when we were on the other side, we took no exception. We did not say they were unparliamentary or unpatriotic.


Mr. Marlineau:: What did Mr. St. Laurent
say?


John Whitney Pickersgill: Mr. St. Laurent believed in free speech. He believed in respect for freedom.


Richard Devere Thrasher: Tell us about his relations with the C.B.C.


John Whitney Pickersgill: He believed in respect for all members of the house and he showed respect for all members of the house-


Richard Devere Thrasher: Tell us about his relations with the C.B.C.


John Whitney Pickersgill: -something that those of us who remember him here will never forget.


An hon. Member:: Tell us about black Friday.
Mr. Pallet!: Who was the prime minister during the pipe-line debate?


John Whitney Pickersgill: If I had been responsible for blank Saturday I do not think I would be too keen to talk about black Friday. But I come to something that is rather more serious. Here is what the Prime Minister (Mr. Diefenbaker) said on the air:
I refer, of course, to those who for political purposes-
He was referring to his opponents in this house in his usual courteous fashion.
-downgrade the credit and prestige of Canada abroad-
Just listen to these words.
-spreading the vicious propaganda of doom and gloom.
That referred to statements precisely like the speeches the right hon. gentleman made when he was not yet right honourable.
Mr. Pallet!: If you live to be 100 you could not measure up to his speeches.


John Whitney Pickersgill: Well, I can look at his speeches and read them, and I notice that hon. gentlemen opposite always object when any of the Prime Minister's old speeches
4562	HOUSE OF
Unemployment Insurance are read in the house. Their quality does not seem to be very durable. Perhaps that is why we always have to have something new.


Francis Alvin George Hamilton: wish you would make a few speeches like the one by the Prime Minister from which you just quoted.


John Whitney Pickersgill: I was neither shocked nor surprised last night when the parliamentary secretary did what has been done in the Tory propaganda over and over again, and he was supported in this, which I thought was rather more serious, by the Minister of Labour (Mr. Starr). If I may have the attention of the Minister of Labour, I should like to point out that last night his parliamentary secretary made the categorical statement that fishermen were brought under unemployment insurance by the present government and the Minister of Labour echoed those words and said that was correct.
I have the reference right here. I have in my hand chapter 50 of the statutes of 1956, assented to on August 14, 1956, some considerable time before hon. gentlemen were on the treasury benches over there. Chapter 50 added to the Unemployment Insurance Act an amendment to section 29 in the following terms:
Notwithstanding anything in this act, the regulations made with the approval of the governor in council under section 26 for including employment in fishing in insurable employment may, for all purposes of this act, provide for-
I do not think I need take the time to read the provisions. It does seem to me that a parliamentary secretary and a minister speaking in the house about their own department, about an act which the minister is responsible for administering, should know the truth about that act, and you could not have any better evidence of maladministration than evidence that the head of the department and his principal assistant are ignorant about the contents of the legislation. Either they are ignorant of the facts or a worse interpretation has to be put upon it and, as that would be unparliamentary, I will not do it. However, I will say, because it is not unparliamentary to say it, that the iteration and reiteration of this untruth, this false statement in the Tory propaganda, is characteristic of the propaganda of hon. gentlemen opposite in the constituencies. It does not seem to me that hon. gentlemen have gained very much by making that kind of claim.
The minister wanted to know what my views were about whether fishermen should be continued under the Unemployment Insurance Act. I do not think anyone else in the house needs to know what my views are on this subject.


An hon. Member:: What is that?


John Whitney Pickersgill: I do not think anyone else in the house needs to know what my views are on this subject. I was a member of the government that put that provision into the act and I will fight to the very limit of my capabilities to keep it there. I must say I am shocked by the apparent undercurrent of opposition to the coverage of fishermen under the act. As the hon. member for Gloucester said yesterday, these people are engaged in the most ancient industry of our country. I do not know of any group of people who are more deserving of protection similar to that given to other people and who were denied it for so long on technical grounds, and I say that once we have found some means of providing this protection it should be continued.
I know that quite an argument can be made for an alternative scheme, and that is fine if you are not a fisherman. But the fishermen, as the hon. member for Gloucester pointed out, are for the most part engaged in a seasonal occupation in most regions of Canada. There are a few areas where you can fish the whole year round but they are very few. The fishermen want to be under unemployment insurance and they want to get their stamps for their fish. Why? So that when other jobs are available they can get stamps for their other work and thus have coverage like other people. If they were under some other scheme they would not be able to take jobs during the part of the year that they cannot fish and get the coverage that other Canadians have. They would have to pay for their stamps but they would get no insurance, which would not be fair.
A great many of these people want to be able to take jobs in the winter time. It is true that most of them have not been able to take jobs over the last four years but that is not their fault. That is because jobs were not available. The hon. member for Gloucester gave the figures yesterday and they do not need to be repeated, but out of the tremendous drop in the fund of hundreds and hundreds of millions of dollars it is estimated that the drain of fishermen on the fund has been something like $23 million. That is not a very considerable amount.
But I will say this about the fund itself, and I think I betray no secrets in doing so. When this matter was considered at the time the addition was made to the act it was decided, after deliberation, that there first should be a year or two of operation under the act to see how it worked and it was also under consideration that if in fact, as seemed likely, fishermen's insurance would not be actuarially sound just as insurance in the case of other

seasonal workers was not actuarially sound, provision should then be made in some other way to meet the deficit so that these groups of people would not be a charge upon the fund itself and upon those who contributed to the fund who were doing so on what was a reasonable actuarial basis. It seems to me that is a reasonable position to take.
The question then is, how should the replenishment be done? I listened to the very interesting speech, except for the beginning and end which I must say I did not think very much of, made by the hon. member for Vancouver-Kingsway (Mr. Browne) who suggested that the fund should be replenished by an additional contribution or tax collected from all employed persons but not from those who have private incomes or from pensioners or retired people.
It does not seem to me, sir, that this segregation of one section of the population, however large it may be, makes much sense. It does seem to me that if we decided, as we decided when we first put seasonal workers under unemployment insurance, that we were going to use the Unemployment Insurance Act as a vehicle not merely for pure insurance of the actuarially sound cases but also to deal with the other related social problem of seasonal unemployment that has to be dealt with-I quite agree with the minister it must be dealt with humanely but our complaint is it has not been dealt with humanely enough -those groups covered by the act who are not covered in an actuarial way should be covered by the treasury, by all of us, by the community.
That is the position that the hon. member for Essex East took three years ago. It is the position that was taken by the former government when it was in office. It seems to me that, notwithstanding the repudiation of that position by the minister today, it is the only right and proper position to take in this matter.
I was astonished, sir, to hear the minister say that he had found that officials in the United States regarded conditions in Canada as being so much better than they were in the United States. This, of course, is not the truth. The statistics that are published by the dominion bureau of statistics and the corresponding United States statistics show that that statement is not accurate and is very far indeed from being accurate.
The minister talked about the optimism he found in the United States, and contrasted it with the gloom and doom he found in his own country where, apparently, the only people who are listened to by the minister and his colleagues are Liberals. It seemed to me that perhaps the minister was getting us ready for another "Follow John" campaign.
Unemployment Insurance However, this time there is a difference and the "John" we are to follow is not here in Ottawa but in Washington. I do not believe the notion that we should just let the United States solve its problems and hope that ours will be solved in the wash, is going to satisfy the Canadian people. The Canadian people want action from their government, as the right hon. gentleman pointed out in 1955, and they want action now.
The minister referred to the fact there was a mention in the speech from the throne of amendments to the Unemployment Insurance Act. The speech from the throne was delivered almost six months ago, and the report of the unemployment insurance advisory committee was, I gather, received about that time or even before that time. At any rate, the problem was certainly known when this announcement was made in the speech from the throne. A serious change had been made in the administration of the act adversely affecting thousands of Canadians who want to work as carpenters or in other forms of casual labour. These people want to follow the advice of the minister, and "do it now". They felt they had covered themselves, having bought stamps and having taken advantage of the employment offer, only to find they were cut off from benefits because of this rigorous interpretation. I say that the minister should have introduced amendments to this legislation when that decision was made.


Lester Bowles Pearson: It is not ready yet.


John Whitney Pickersgill: It is not ready yet; as a matter of fact, I doubt if one word has been put down on the first draft of the bill. Of course, they do not know when this legislation will be introduced, just as the Minister of Finance (Mr. Fleming) does not know what he is going to put in his budget. Perhaps they will not be able to decide what they can do about any of these things until the by-elections are over.
The minister talked about the 23 measures the government had brought in this year. He made a statement which is not in accord with the Hansard record, perhaps that is the best way of putting it, about the attitude of this party toward those measures. As a matter of fact, we shocked and annoyed the government by omitting the debate on the address so we could get on with the government's legislation. In most cases, we only made one or two speeches on these bills in order to get them through and give them a chance to work. We did not think much of some of them, but we said, give them a chance. What did hon. gentlemen on the government side of the house do? They talked and talked, just as they did last Saturday afternoon, saying what a good fellow the minister was and how

Unemployment Insurance lucky we were to have "John" at the head of the government. They filibustered their legislation. Why was this done? It was done because the government's legislation is not ready yet. We have had nothing put on the order paper for six weeks except purely routine matters. We are supposed to be hastening toward the end of the session. We are asked to take estimates all week because the government cannot make up its mind what to do about the Unemployment Insurance Act or any other important measure that should be before this house.


George Clyde Nowlan: That is absolutely wrong.


John Whitney Pickersgill: The Minister of National Revenue (Mr. Nowlan) would perhaps understand me if I were to say that the government should put up or-well, the minister knows the rest. Let us see this action. Let us see this new vision of the new Canada that was unfolded at London while the rest of us were asked to do the nation's business and the leader of the government was politicking down at London.


Some hon. Members:: Shame.


John Whitney Pickersgill: Does the hon. member contend that was cheap? It was a pretty cheap thing for the Prime Minister to do.


Mr. Lambert:: What you are saying is cheap.


John Whitney Pickersgill: It was a pretty cheap thing for the Prime Minister to do. He is the head of the government, and he insisted on the rest of us being here. Where was he? He was politicking, emitting some hot air without any substance. If he had gone down to London and told them what was going to be done about the Unemployment Insurance Act, or told them what was going to be done about the fund or dealt with some of the problems of the country-


Michael Starr: Would the hon. member permit a question?


John Whitney Pickersgill: Certainly.


Michael Starr: Would the hon. member advise the house where the leader of his party was and where the hon. member for Essex East was on Saturday?


John Whitney Pickersgill: I would be very happy to do so. The Leader of the Opposition (Mr. Pearson) had an engagement which he had made before the Prime Minister forced this rule on the house which we opposed-


Some hon. Members:: Oh, oh.


John Whitney Pickersgill: I must say I am very glad the Leader of the Opposition was spared these 17 Tory speeches which bored the rest of us all day Saturday.


Mr. More:: On a question of privilege, Mr. Speaker, may I say that the hon. member has made an accusation that the Prime Minister forced Saturday sittings on this house. The amendment for Saturday sittings was introduced by a member of the C.C.F. party and the leader of the Liberals at that time did not know what to do. The house almost unanimously adopted that amendment.


Mr. Deputy Speaker:: Order; I think this discussion is entirely out of order. I think we should return now to a discussion of the amendment.


John Whitney Pickersgill: As a matter of fact, I think that is a very sound idea. My time has nearly expired, and I want to say a word about the subamendment.


Mr. Browne (Vancouver-Kingsway):: On the
question of privilege that was raised-


John Whitney Pickersgill: On a point of order, may I say that question of privilege was disposed of.


Mr. Deputy Speaker:: I can hardly decide in advance whether or not the hon. member's question of privilege is to be accepted.


John Ferguson Browne: In so
far as the question of privilege is concerned, the hon. member for Bonavista-Twillingate said that Saturday sittings were forced on the house by the Prime Minister. I believe that statement should be withdrawn. It is entirely false and inaccurate, as was pointed out earlier. He should be required to withdraw.


John Whitney Pickersgill: There is no question of privilege, but I will happily amend the statement. I will say that the 200 sheep followed the Prime Minister and the rest of us had to submit to it.


Some hon. Members:: Oh, oh.


John Whitney Pickersgill: Then, the Prime Minister did not do us the courtesy of being here himself. I have amended the statement, and I hope that will satisfy the sensibilities of hon. gentlemen opposite.
I want to go back to the amendment, because it does seem to me that no one in this party will have an opportunity to speak again before the division. I may say that we in the official opposition are heartily in accord with the subamendment moved by the hon. member for Assiniboia (Mr. Argue). In fact, the hon. member for Essex East began to urge this course in 1958, and he has been consistently urging it as have the rest of us who have spoken on this matter ever since that time. It is the only right and

proper way of dealing with this situation so long as there is abnormal unemployment. We, therefore, intend to vote for this subamendment.
I am not saying that nearly all the administration-


An hon. Member:: Are you for Douglas or for Argue?


John Whitney Pickersgill: Perhaps I could let this debate behind me go on for a minute or so.


Lester Bowles Pearson: Why do they not keep order?


Mr. Peters:: Why does not the hon. member rise in his place and make a speech?


Norman Platt Lambert: If I did so, I would treat the subject a little bit more logically.


Paul Joseph James Martin: On a point of order-


Mr. Deputy Speaker:: Order. The hon. member for Bonavista-Twillingate has the floor and I would ask all hon. members to please allow him to proceed with his remarks.


John Whitney Pickersgill: I was saying that it seems to me quite important that we should take action and do so promptly and that this house should be given adequate time in which to consider the proposals of the government with respect to the replenishment of this fund and with respect to these abuses that hon. gentlemen opposite now assert they find in the administration of the act. Indeed, the hon. member for Vancouver-Kingsway himself said that the act now was in such a mess it could not be enforced by anybody. I suggest that we should have these amendments before us at once.
Hon. gentlemen complain about the lack of suggestions from the opposition; that has been a constant refrain. They complain about lack of suggestions from the opposition. There has been no lack of suggestions from the opposition either about this matter-a good many have been made right in this debate- or about the problem of unemployment about which the minister spoke. The minister referred to these measures and I remind the minister, since he referred to them first, that the vocational training proposals which were brought in last November were recommended by my friend the hon. member for Trinity (Mr. Hellyer) in 1958.


Michael Starr: I was not allowed to speak about them.


John Whitney Pickersgill: The minister says he was not allowed to speak about them.


Michael Starr: Not about those things.


John Whitney Pickersgill: I am confining myself to points raised by the minister and am raising no new matter whatsoever. The minister says 90205-6-288
Unemployment Insurance the government received no suggestions from the opposition. Rather than give my views which some might regard as partial or biased I should like to read from the revised Canadian Annual Review for 1960, a publication which we have missed since 1939 and which all of us should be happy to see revived again because it is obviously a great contribution to our knowledge of affairs in this country. I should like to read from the Canadian Annual Review's summary on this very question of suggestions-and that is what makes it relevant-what the Globe and Mail said. They quote from the Globe and Mail.


An hon. Member:: What is the page number?


John Whitney Pickersgill: It is on page 20 of this volume. The Globe and Mail of August 12, 1960 said:
It might have been assumed that the Diefen-baker government, with its huge majority, would have guided and controlled the proceedings in parliament. It did nothing of the kind. Instead, the initiative rested throughout with the opposition and the private members... In all the debates too, it was the opposition speakers who seemed to have most of the ideas. The cabinet provided little leadership. Its members gave the impression of men baffled by the problems which confronted them, unsure of their course, anxious to put off action in the hope that something would turn up.


J.-H.-Théogène Ricard: Who wrote that? A friend of yours?


John Whitney Pickersgill: As far as the Unemployment Insurance Act is concerned, nothing has yet turned up.


William Arnold Peters: Mr. Speaker, I welcome the opportunity this afternoon of speaking on this amendment of welcoming the Prime Minister (Mr. Diefen-baker) back to the house and of expressing the hope that he has something to say on this important matter. It seems to me that this is the fifth or sixth time that we have discussed this matter of unemployment either in this manner or in others. Yet we are continually hearing the charge that the opposition has nothing further to offer. The reason this happens I believe is simply explained. It was explained quite simply by the hon. member for Vancouver-Kingsway (Mr. Browne) last night and I should like to refer to that matter. But before doing so, I should like to say what we think about the fund itself.
We in the C.C.F. believe, as our amendment states, that the fund itself is an insurance fund set up and contributed to by the employee through his contribution and through the wage factor that is a contribution of the employer. We believe that the government assumed the responsibility of administering the fund and also of making

Unemployment Insurance a contribution to that fund. We believe that the fund itself is an insurance factor, that it must be run as an insurance fund, and that it should be for the use of that 1 per cent to 3 per cent of the Canadian people who, through no fault of their own, through normal unemployment can expect to be unemployed. This is the reason why the fund was established. It was not established for the maintenance of the Canadian economy in conditions of recession or unemployment.
By many of those who have spoken statements have been made to the effect that over the years the unemployment insurance fund in this country and those in other countries have been established to carry people over periods of unemployment and that they have been a vital necessity in alleviating the suffering and the other ills that affect those who find themselves unemployed through no fault of their own. This is our understanding of what the unemployment insurance fund is.
If anyone wants to know what is the difference between the three political parties with regard to the unemployment insurance fund, all he needs to do is to examine the record of the proceedings of the industrial relations committee of two years ago when the last amendments were made to the act. If he does so, he will easily be able to ascertain what is the attitude of each of the parties toward unemployment insurance.
The Conservative government has made to the act many amendments that have been advantageous. It is quite true that they brought in extensions to the period of benefits, increasing it from 32 weeks to 52 weeks. This action has been appreciated. It is also true that they extended the seasonal benefits, an action that has also been appreciated. However, in speaking of seasonal benefits, it should also be noted that these are still tied to contributions. Although you can extend them as far as you wish at either end, the contribution period is limited and will cover only a specific period of time in any event. Hence to extend it may mean that a person gets the benefits earlier but it does not necessarily mean that he gets any more unless his regular benefits have disappeared at a particular period during the seasonal benefit period.
It is also true that more people were added when the last amendments were made to the Unemployment Insurance Act. But these categories were high rate employees. They were people in the higher wage brackets. They were not such people as those who are coming into the employment market at the present time. They were not those who were in the casual labour class; they were not those that are immediately affected by seasonal unemployment. Rather they were the category of

people who seldom, if ever, are unemployed; and if they are unemployed, they have skills that will enable them to take employment in fields other than the one in which they are highly skilled. They still have a good advantage in obtaining employment, if any employment at all is available. So these people did contribute and were not going to be entitled to any additional benefits.
We say the amendment should be amended by adding the following words:
-and its failure to give consideration to the reimbursement of the fund from the public treasury for the excessive depletion it has suffered as a consequence of the recent abnormal unemployment.
Because of seasonal employment conditions in Canada we believe that 1 per cent to 3 per cent unemployment may be expected. It certainly is not welcomed; it is not wanted; but we anticipate that from time to time there will be a slight seasonal unemployment situation in the region of 1 per cent to 3 per cent. Anything over this will be caused, or is likely to be caused by other reasons which do not come under the conditions for which the fund was set up.
We have suggested that anything over this figure must be compensated by the federal treasury because the federal government is responsible for the employment situation. I have not heard the minister say he is not responsible for the employment situation. We believe that in those fields where unemployment is greater than the minimum amount, the federal government must make contributions to maintain the unemployment insurance fund.
At the present time this is not being done. If another season passes and this situation prevails, we will either have to find new ways of adding money through contributions or the fund will no longer have any money in it.
Yesterday the hon. member for Vancouver-Kingsway (Mr. Browne) made quite a long speech. I see him today sitting in a position that would indicate he may be the assistant to the assistant to the Minister of Labour (Mr. Starr). If so, I wonder whether what he said is a reflection of this government's attitude.
The hon. member pointed out in his speech:
-we have seen once more a demonstration of the complete irresponsibility of the opposition in this house ... and of their absolute failure to do anything-in fact their determination to do absolutely nothing-to assist in the solving of any problems that might be facing this country.
Our suggestion that we take from the treasury that amount of money which will be calculated on the excess of unemployment over what could be considered to be the original interpretation of the amount of

unemployment and put this money back into the fund certainly would not be doing nothing, I suggest, to solve this particular problem.
The hon. member goes on:
We have heard a barrage of complaints about the unemployment insurance fund being depleted. I think this is a serious problem facing the country and the government has recognized that by indicating its intention to bring forward at this session of parliament amendments to the Unemployment Insurance Act.
Here the hon. member is not denying that this is a fact; he is saying the government is going to do something about it. Then he blames the opposition in these words:
-they have failed completely to offer any suggestions except the one suggestion that they make on all problems that face Canada, that we should print some more money and pay it out of the federal treasury.
I have not heard that suggestion since the Social Credit party left this house. While it is true the hon. member may hear some of these suggestions from hon. members from Alberta in the backbench Conservative ranks, I have not heard it put forward as a solution for replenishing the insurance fund which has been depleted.
The hon. member goes on to say:
Perhaps if we make a few more printing presses and print money faster we will be able to solve all problems on the basis upon which they want to solve them.
I am not sure who he is talking about there, because I have not heard these suggestions. However, I would suggest he has heard them from some of the backbenchers who follow very closely the Social Credit philosophy. The hon. member goes on to say:
I am not suggesting more people should not be covered by the act and should benefit, but I hope I have enough responsibility to offer some suggestion as to how this can be brought about other than by printing more money.
I hope he has too. I want to read some of the suggestions he has made. One is:
The act should be renamed the unemployment compensation act.
I do not understand just what advantage that would have. Then the hon. member suggests:
Every person in the labour force who is employed under a contract of service should contribute to the fund regardless of income or occupation.
Here we have the solution of the Conservative party for solving the depletion of the unemployment insurance fund. They say, "Throw everybody into it. Let us no longer make it an insurance fund. Let us not have any risk involved in it at all. Let us throw everybody in, particularly those who could not be unemployed".
I suggest these people under a contract of service are the armed services, and certainly the civil service, because the hon. member 90205-6-288i
Unemployment Insurance goes on to mention the civil service. These are people who are not normally unemployed at all. They say, "Throw everyone into the unemployment insurance fund". This was the suggestion made by many hon. members in the industrial relations committee when the act was before that committee on a previous occasion. They said, "Throw everybody into it. They cannot possibly benefit from it, but we will get from them all the contributions we can".
What did they say about the Liberal government when they built up a huge fund? They said, "This is not fair; it is not in keeping with the insurance principle. This is not the way to do it". Now, when we find we have much greater unemployment, unemployment that really is not of a casual nature and which is draining the fund, they say, "Let us throw in a lot of people who could not possibly qualify for the benefits of this fund. Let us collect from them; let us collect from people who cannot possibly get any benefits".
This seems to be the solution put forward by these hon. members, and what is more dishonest than asking people to pay into an insurance plan who could not possibly receive any benefit out of it. No wonder the hon. member is honest enough to say, before he suggests this, that the name of the act should be changed. He says, "We will not call it an insurance plan any longer; we will rename the act the unemployment compensation act".
That is exactly what it will be. These people who are employed will be compensating the government and helping it maintain those people who are unemployed. This is not my interpretation of what an unemployment insurance act should be. This is not the interpretation I take from similar acts in other countries, where they consider the unemployment insurance principle to be a very important one for alleviating temporary, seasonal and casual unemployment which is not a major catastrophe, in an economic sense, in terms of having a large segment of the population unemployed, not through seasonal lay-offs but because of an economic condition which does not provide work for those who seek work.
The hon. member goes on:
This has been extended to a complaint about the failure of the government to consider the reimbursement of the fund.
Why should not the government reimburse the fund? The situation is of the government's making, and I do not suggest it would be done only by a Conservative government. It would probably have been done by a Liberal government. It certainly would not be done by a C.C.F. government.

Unemployment Insurance


Some hon. Members:: Oh, oh.


J.-H.-Théogène Ricard: There will never be such a thing.


Mr. Kucherepa:: That could never happen.


William Arnold Peters: If the hon. member wants to make a speech I will be quite happy to curtail my remarks so that he can rise and make it. He never makes a speech except from his seat, and it sounds like it.
The new expert on the unemployment insurance fund, the hon. member for Van-couver-Kingsway, goes on to say:
The situation which has arisen at the present time makes it impossible to administer it properly, and with the paying out within the terms of the act that is being done, nothing could happen to the fund but its depletion.
I do not want to go into all the financial charges that have been made, because I am inclined to believe the minister who said this afternoon that there would have been little difference in the financial arrangements no matter what government had been in power, because there had been only one change in the staff which administers this act. I presume the minister meant the administration of the financial aspects of it. While it certainly has not been advantageous it is not necessarily the responsibility of this government.
The hon. member points out:
The situation which has arisen at the present time makes it impossible to administer it properly-
Again, what he is saying is that you cannot administer the Unemployment Insurance Act properly if you have not more money going into it than is going out of it, and because we have not made the arrangements which he is suggesting by bringing in all the people who could not possibly find themselves in the position of being unemployed, we are not properly arranging matters. The fund is being depleted at the present time precisely because we are carrying people it was not anticipated would be carried when the act was passed. It was not contemplated that they would be carried, because at that time the people believed it was an insurance fund to cover only a limited amount of unemployment of casual or very short duration. The hon. member goes on to say:
It then becomes a question of how the fund could be built up. The opposition has suggested, as I say, that the federal government should simply contribute a large amount of money to reimburse the fund.
That is not altogether true. The part of the opposition to which I belong, the efficient opposition, does say this, but I do not believe the official opposition has made any such statement that the government should put in the full amount needed.


An hon. Member:: We have said that since 1958.


William Arnold Peters: In that case I stand corrected.
I should only try to speak for that part of the opposition which I represent. The hon. member went on to say:
Many people now drawing out of the fund should not be drawing out of it, and many people who should be able to qualify to draw out of the fund are not now qualified to draw out of it, nor do they pay into it.
Good heavens, why should they draw out of it if they do not pay into it? This is an insurance fund, not a charity organization. It is not a dole. If they do not pay into it, why should they draw out? Sometimes we hear complaints from people who pay into it but who are nevertheless not eligible to draw out of the fund, and these are justifiable complaints. I hear occasionally suggestions from my constituents that because they have paid into the fund for many years and received no benefits from it they should be entitled to pay at a reduced rate as one does in the case of car insurance when there have been no claims. There is some merit in that idea.
As to that statement by the hon. member that many people who should be able to qualify to draw out of the fund are not now qualified to draw out of it, I hope that is not the impression which the Minister of Labour (Mr. Starr) holds. I hope the hon. member for Vancouver-Kingsway is speaking for himself, because this suggestion would mean the end of the fund and would put many people on the dole. There used to be a dole. That is how it was done in days gone by. Money was contributed by the federal government and they paid workers during the depression 20 cents a day to build airports all over the country; those engaged on building roads received a packet of tobacco once a week. This was a contribution by the federal government.
We are suggesting now that the government should make a much more substantial contribution in the form of a payment to the fund to compensate only for that portion of the outgoing which was not anticipated when the fund was set up originally on an actuarial basis. Present economic conditions-the recession, the depression, call it what you will- which now exist, are not the responsibility of the unemployed people of Canada but the responsibility of the government and, in a way, of the people as a whole because everyone in this country, really, in the last analysis, constitutes the government and should take the responsibility of replenishing the fund. As the head of the insurance branch indicated two years ago, approximately $500,000 would be considered a safe and sensible sum, though, of course, conditions have changed since then.

The suggestions to which I have referred are not the only suggestions which the hon. member for Vancouver-Kingsway made. It would appear to me that the hon. member had done considerable research and that he might even have consulted with the Minister of Labour before taking part in the debate. I should like to know whether the government approves the suggestion. The hon. member goes on to say:
There are some groups, such as civil servants, who are not included under the act. I believe they should he.
I have already pointed out that this was the consensus of opinion among many members of the Conservative party on the industrial relations committee when the act was revised on an earlier occasion. The hon. member continues:
The provinces can use their discretion as to which of their employees shall be subject to the provisions of the act and, of course, they follow the policy of insuring those people who are temporary employees and who are almost certain to draw benefit at one time or another. I feel, therefore, that these classes of employees are not bearing their share of the cost of unemployment insurance.
Well, if they are not, the hon. member should report them to the commission and I am sure they will cease to get the benefits.


Richard Devere Thrasher: The hon. member has completely missed the point.


William Arnold Peters: You cannot sort them out, and the hon. member is either talking from ignorance of the situation or he is talking out of both sides of his mouth in discussing civil servants and their position with regard to the fund. If they are all going to be in it, that is okay. That is the suggestion the hon. member makes. But if he is going to suggest that we should let the temporary ones be permanent and still not draw benefits, then I think even his colleagues would disagree with him.


John Ferguson Browne: On a
point of order, Mr. Speaker, the hon. member has been quoting from the remarks I made in this debate, taking them out of context and completely misinterpreting them. Now they are becoming confused with the comments which the hon. member himself is making. I think he should be required to make his own speeech.


Mr. Speaker:: If the hon. member thinks he is being misinterpreted I will give him an opportunity to speak later on.


William Arnold Peters: Well, this speech lends itself to misinterpretation. I hope I am not doing that-


An hon. Member:: Make your own speech.
Unemployment Insurance


William Arnold Peters: It is more fun rehashing this one, because these are new ideas and they are ideas which are being put forward by a backbencher in the Conservative party. I should like to know what is the position of the government with regard to them. Is the government going to adopt these views, or throw them out? Many of them, I submit, should be throw out but some of them may be of consequence and deserving of consideration by the government. It is for this reason I wish to refer to them.


Mr. Broome:: Why not try to put forward some constructive ideas, too?


William Arnold Peters: I presume that in discussing these matters we are raising constructive arguments. They are either worthy of some consideration or of no consideration. If they warrant no consideration, then, in bringing them to the attention of the house, we are helping to make sure that that is exactly what they will get. If they warrant some constructive consideration, they may receive that also. The hon. member goes on to say:
If the federal government is going to contribute huge sums to the unemployment insurance fund, as they suggest, we would be taking the money out of general taxation. Among those contributing to its payment would then be persons in receipt of old age pensions and elderly people who could not possibly receive any benefit from the fund and who therefore, I submit, have no reason to be paying into it.
If they are paying into the fund apparently they are employed, and because they are receiving an old age pension they should not be prevented from receiving the benefits. Presumably they are receiving the old age pension because they have reached the age of 70.


John Ferguson Browne: Mr. Speaker, surely the hon. member should not be permitted to twist my words as he has been doing since he started.


Mr. Speaker:: I take it the hon. member for Timiskaming (Mr. Peters) is referring to the viewpoint expressed by the hon. member for Vancouver-Kingsway (Mr. Browne) and endeavouring to counter that viewpoint in the debate. If he is improperly quoting the hon. member, that would be ground for complaint. However, as I have indicated, the hon. member will have the opportunity of correcting any misinterpretation of his speech, to which he takes exception, at the end of the hon. member's remarks.


John Ferguson Browne: If the
hon. member wishes to quote my remarks from Hansard and gives the reference, I have no objection, but I do not believe he should be allowed to give his interpretation of what I said and use that for his own purposes. I presume he has been quoting from Hansard,

Unemployment Insurance as he has held a copy in his hand and has purported to read from it, but he should not be allowed to make these twisted statements in portraying what I actually said.


Mr. Speaker:: If the hon. member is quoting he should give the reference and should of course use the exact words. I think the point is well taken in this regard. There has been some doubt when the hon. member was quoting and when he was not quoting.


William Arnold Peters: Mr. Speaker, I hope I have quoted the exact wording. I did not indicate where I was quoting when I commenced, but I am sure the hon. member will have little difficulty in finding his remarks. They appear at page 4518 of Hansard for May 8, 1961.
I was commenting on his statement-


Mr. Drysdale:: You should say "I am quoting"-


William Arnold Peters: I am not quoting. Mr. Speaker, I will use the quotation again. It appears in Hansard at page 4518 as I have indicated. He is reported there as saying:
Among those contributing to its payments would then be persons in receipt of old age pensions and elderly people who could not possibly receive any benefit from the fund and who therefore, I submit have no reason to be paying into it.
What he is saying is that if an individual is receiving the old age pension, that individual should not be working. However, I suggest that an individual who is working, whether receiving the old age pension or not, must make contributions to this fund by law, and having made contributions, is entitled to receive the benefit. I do not feel that the old age pension has any relation to the unemployment insurance fund. Old age pensions are social benefits given to individuals who have reached the age of 70 years regardless of whether or not they are capable of working.
The hon. member then is reported as follows:
I submit that we have to amend the act in such a way as to protect those who need protection and provide for them for as long as they need such assistance without regard to the number of contributions they have made to the fund.
I do not understand that statement at all. The hon. member suggests that we should not relate the benefit period to the amount of contribution. In that event any Tom, Dick or Harry, such as a young chap out of school who works for perhaps one week and then not again for the rest of his life would be able to benefit under this fund even though he has made no further contribution to it. Is that what the hon. member is suggesting? If it is, I think it is a ridiculous suggestion. If this is what is meant by amendments proposed to this act we will be here

much later than June or July because I will never agree to that type of change.


John Andrew W. Drysdale: You are limited by the rules.


William Arnold Peters: I am well aware what the rules and privileges are.
I would like to read one further statement made by the hon. member for Vancouver-Kingsway, as reported at page 4518 of Hansard in the second column. That statement reads as follows:
However, I do believe there are many married women drawing money out of the fund who have absolutely no need to do so. It is very difficult to establish whether or not married women are actually looking for jobs. This is one of the things, which in my view, is helping to drain the fund. Certainly, it is beyond the ability of government to control this practice by way of administration; an amendment of the act is required in order to deal with things of this nature.
The fact that a woman is married or not seems to me, and apparently as well to the Minister of Labour (Mr. Starr), not to be the criterion governing whether the individual should or should not draw from the unemployment insurance fund. The hon. member would have been well advised to have listened to the Minister of Labour this afternoon. If he had I am sure he would have taken the opportunity of correcting his misinterpretation. I say that presuming that he purported to speak on behalf of the party with which he is associated.
The minister said this afternoon that the act was changed in such a way as to give equality to women, and that this government would not discriminate against women in respect of the benefits of the fund. The minister is to be congratulated on making that very fair and welcome commitment this afternoon.
Mr. Speaker, may I call it six o'clock.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 8 p.m.
William Arnold Peters: Mr. Speaker, before the recess I had been commenting on some of the suggestions made by the hon. member for Vancouver-Kingsway (Mr. Browne) to solve the problems respecting the unemployment insurance fund. In that regard I should like to quote what the hon. member had to say in concluding his speech. As found on page 4521 of Hansard, he said:
It is no use condemning perpetually. They always seem to be against something.
He was speaking of the official opposition.
I have not heard a helpful suggestion come from them during the whole time I have been here.

I am reviewing some of the suggestions made by the hon. member in relation to the fund and what he would consider, I presume, to be solutions for the problems raised by the depletion of the reserves in the fund, which has dropped drastically since the government came into office. As I pointed out before the recess, this afternoon the Minister of Labour (Mr. Starr) in a very clear and concise manner answered the charge made by the hon. member in this statement, as found on page 4518 of Hansard:
However, I do believe there are many married women drawing money out of the fund who have absolutely no need to do so.
The Minister of Labour commented on that suggestion and pointed out quite rightly that the government had established equality of opportunity for women, whether married or otherwise, in relation to the fund, and I think nothing further needs to be said about that. However, the next suggestion by the hon. member was, I think, a rather interesting one and warrants some consideration. I quote from the same page:
Another cause of huge drains on the fund is the action of people who retire at the age of 65 and who then feel qualified to draw from the fund for 52 weeks. Though they only represent 3 per cent of the claims on the fund they are responsible for 10 per cent of the money paid out.
This seems to me to be an unusual statement. In analysing it, it is very difficult to tell whether or not the hon. member is opposed to these people retiring at 65 or is opposed to them qualifying because of the fact they have made contributions to the fund and as a result will get some benefits for a full year and will have some means of supporting themselves. This raises the problem of what happens to these people who have obtained benefits until they are 66 through this method of supplementing their income when no jobs are available to them. What happens to them between that age and the age of 70 when they are qualified to apply for assistance in another form? These people may only represent 3 per cent of the claims but apparently the hon. member wants to change the act and take away the benefit that accrues to these people who all their lives have paid into the fund and take advantage of the only opportunity they have to gain access to the benefits of the fund. I do not think they should be eliminated.
The hon. member went on to say, as found on page 4519 of Hansard:
... he indicated that in his view-
He is referring to the hon. member for Gloucester (Mr. Robichaud):
-the reason that the unemployment insurance fund had been depleted was that there was a high number of claimants drawing benefits from
Unemployment Insurance the fund. With that statement I certainly agree. He did not blame the condition of the fund on the high unemployment particularly, as the subamendment does; he simply blamed it on the high number of claimants drawing from the fund.
I think this is an accurate statement and a complete denial of the amendment which he subsequently moved.
This is a very interesting statement, Mr. Speaker. What is being said is that the substantial unemployment situation did not result in the large number of claims but that the claims were coming from some other source or were being made by people who were abusing the fund. He is saying that the number of people who are abusing the fund are much more numerous than the number of unemployed, that the high rate of unemployment did not have this effect but rather that it resulted from the actions of those who abuse the fund. The hon. member went on to say:
I believe, as I had started to Indicate before the dinner recess, that there are a number of reasons why there are a high number of claimants under the act. We have the case of married women.
He went on to say:
In most instances it was also shown that they had husbands who were working full-time and for that reason there really was not any necessity for their drawing funds under the act.


Mr. Speaker:: I am sorry to interrupt the hon. member but his time has expired. Does the hon. member for Vancouver-Kingsway wish to pursue the point of explanation he raised earlier?


John Ferguson Browne: No,
Mr. Speaker.


Hon. Donald M. Fleming (Minister of Finance):: Mr. Speaker, in the eight minutes that remain I must, of course, confine myself to one aspect of this debate and that is the subject of the investment of the funds of the commission. In this short time I shall endeavour to correct some of the welter of errors and distortions which have marked many of the speeches made by opposition members in the course of this debate.
There is nothing very new in what they have said. You will find that nearly all of it was said on June 16 and 17, 1959, in this house. The provisions of the Unemployment Insurance Act with regard to investment are direct and brief. Section 85 requires the Minister of Finance to invest all of the moneys to the credit of the unemployment insurance fund not required for the purposes of the act, in obligations of or guaranteed by the government of Canada. Section 20 sets up an investment committee composed of one person nominated by the Minister of Labour, who is the assistant deputy minister, one person nominated by the Minister of Finance, who is the deputy minister, and the governor of the

Unemployment Insurance Bank of Canada. It provides that investment transactions under section 85 shall be made only on the authorization of that investment committee.
This is the same investment committee, Mr. Speaker, with one exception, that was in office when the present government came into power. It is in relation to the duties of investment a highly competent committee and there has at no time been any interference on the part of the government with the investment activities of the investment committee.
As to the policy followed by that committee, Mr. Speaker, it has been clear from the beginning. There were two objects in view. The first was to distribute the investments among all sectors of the market, and this was particularly important when the fund grew to a substantial size. The other purpose was to earn interest. While the fund was increasing it was the policy of the investment committee to spread the portfolio more or less in equal thirds between short term, mid-term, and long term bonds. When the fund began to decline it was the policy of the investment committee to sell bonds in a manner that resulted in only moderate capital losses.
Up to March 31, 1957, the total interest earned by the fund was about $223 million, or an average yield of just under 3 per cent per annum. Throughout that period short term rates, that is, on bonds two years and under, varied between one half and three quarters of the unemployment insurance commission's actual average yield. Had the investment committee confined its portfolio to short term bonds the interest earnings of the fund would have been about 40 per cent less than they actually were; and if one adds interest earnings on interest earned the fund at March 31, 1957, would have been at least $100 million less than it was.
In managing a fund of over $800 million, it would be impossible to sell hundreds of millions of mid and long term bonds into the market and buy in their place hundreds of millions of shorts without completely disorganizing the bond market. As the fund began to decline the policy of the committee was to sell in to the market in an orderly manner those issues which from time to time yielded the smallest capital losses.
Over the past four years the capital losses have been less than $30 million, or less than one third of the gain to the fund from having built up and maintained a balanced portfolio.
It would have been impossible to expect this debate would run its course without some mention by hon. members opposite of the

conversion loan. Of course, they distorted the facts there, too. Let me make four points with regard to this matter.
First, of the fifth and sixth 3 per cent victory loans maturing in 1959 and 1960, the fund had held a total of $89 million. These were converted into 3 per cent's of 1961. These bonds were sold between November 16, 1959 and March 4, 1960 at a net capital loss of $3,587,509. Had the victory loan issues been unconverted, and had the bonds still outstanding been sold subsequently at the time the 1961's were sold, there would have been a capital loss of $1,449,505 and in addition there was a cash credit adjustment on the conversion of $648,874.62, making a net over-all loss due to the conversion of just $1,489,129.38.
Second, of the seventh 3 per cent victory loan maturing in 1962, the fund held $63 million which were converted into 3|- per Cent bonds of 1965. These were sold between December 9, 1959 and April 4, 1960 at a capital loss of $5,737,937.50. Had the 1962's been unconverted they would have been sold at a loss of $2,167,325. The net additional book loss arising from the conversion was thus $3,570,612.50; but there was a gain in interest earnings of $691,515.63 and a cash adjustment of $626,850, so the net loss was only $2,252,246.87.
Third, of the eighth and ninth 3 per cent victory loans the fund held $154 million and these were converted into 4| per cent bonds of 1972. These were sold in 1958, 1959 and 1960 at a capital loss of $9,495,211.25. Had they not been converted but had been sold at the same time as the 1972's there would have been a capital loss of $8,847,947. The net additional book loss arising out of the conversion was thus $647,264.25; but there was a gain in interest of $2,093,969.77 and a cash adjustment of $319,800, so there was an over-all gain of $1,766,505.52 to the fund.
Fourth, thus the total over-all loss to the fund arising out of the conversion operation was about $1,974,870.73 out of a total holding of $306 million or about one half of 1 per cent.


Some hon. Members:: Oh, oh.


Mr. Speaker:: Order; it being 8.15 o'clock, it is my duty, pursuant to section 3(d) of standing order 56, as provisionally amended, to interrupt these proceedings and forthwith put the questions now before the house.



REQUEST FOR REFERENCE OF BANK OF CANADA REPORT TO STANDING COMMITTEE

Paul Joseph James Martin: Mr. Speaker, I rise to discuss a grievance which affects every member of this house, and which indeed affects the rights of parliament, involving the obligations of members of parliament in the performance of their duties.
The Minister of Finance (Mr. Fleming), a few weeks ago, tabled the report of the governor of the Bank of Canada, and that report dealt with the most fundamental questions facing Canada, particularly in so far as domestic problems are concerned. The report of the governor of the Bank of Canada deals with a number of matters and among these, of course, are the economic problems facing Canada at this time, and particularly the

solutions which the governor of the Bank of Canada envisages in his program as a solution to unemployment in Canada. The key to his thinking in this regard is to be found at page 4 of that report where, in the second last paragraph he says:
Economic developments have not been of such a character as to raise employment in step with the increase in the labour force.
The governor goes on, and I now refer to the press release which accompanied his report, to point out, among other things, that throughout the last few years unemployment trended upward on a steeper slope in Canada than in the United States. At another point he said that large scale unemployment is an indication of the failure on the part of all of us collectively to make the most effective use of the resources of modern technology and social organization at our disposal in Canada.
Then he asks what are the best measures to take and how is the cost of these measures to be shared by the various groups and individuals that make up our national community?
The Bank of Canada Act is one of the important legislative enactments of this country. It determines the authority of the governor of the Bank of Canada, and sets out the limitations on the functions of the governor of the bank. It establishes the authority of the bank in the formulation of monetary policy. The relevant sections in that connection are to be found in subsection 2, section 20; subsection 1, section 27; and subsection 3, section 18, of the Bank of Canada Act.
We are told by the government that it is anxious to expedite the public business, notwithstanding the delays for which it is essentially responsible. But we have not had from the Minister of Finance any indication of his desire to see to it that members of this house are given an opportunity of discussing the report of the Bank of Canada in the presence of the governor of the bank himself. The Minister of Finance in another context, when charged with some responsibility for monetary policy in Canada, has said that is the responsibility which exclusively resides in the office of the governor of the Bank of Canada. While he did not recite the pertinent sections of the Bank of Canada Act as his authority, the fact is that parliament has given to the governor of the Bank of Canada responsibility for the formulation of monetary policy. Thus far the statement of the Minister of Finance and the position I take and which is taken by this party are in accord.
The minister, of course, goes one step further and says that because parliament gives the governor of the Bank of Canada responsibility for the formulation of monetary policy he, the Minister of Finance, and

the government of which he is a member have no responsibility whatsoever for the consequences of the exercise by the governor of the Bank of Canada of his undoubted legal power in the formulation of monetary policy. We of course take the position that the government of the day under our system of government is responsible for all policy of any emanation of the crown, whether it be through authority exercised directly by parliament or indirectly by delegation from the government to a particular official, to a crown company or to any other instrumentality whatsoever.
But having in mind the position that the government takes through the Minister of Finance that it has nothing to do with monetary policy whatsoever, a mistaken position, the government is derelict in the performance of its duty in denying to parliament the opportunity of examining in detail the report of the governor of the Bank of Canada. There can be no discharging of that responsibility merely by a budget debate, by a set series of speeches in which the Minister of Finance discusses debt management, financial policy and indirectly comments, if he wishes, on monetary policy.
There can be no excuse whatsoever, it seems to me, for the government of the day taking the position that if the authority of the governor of the Bank of Canada is exclusive in this matter parliament should be denied the right of examining the report of the Bank of Canada, particularly when it deals with matters of such fundamental concern to this nation as unemployment and economic conditions generally in our country.
Part of my grievance, sir, arises out of Your Honour's interpretation of our procedures, and I do not quarrel with that interpretation. That is not the purpose of this present intervention. But Your Honour has ruled that it is not open to a private member of the house to move to have the report of the governor of the Bank of Canada be placed before the banking and commerce committee or any other committee of the house. You have so ruled and we have abided by that ruling. In spite of this, attempts have been made through other devices to try to get the report before the banking and commerce committee.
I asked the chairman of the banking and commerce committee the other day when that committee was going to meet, obviously for the purpose of giving those of us who take this position an opportunity in that committee of asking the committee to determine on a course involving a reference to the house for the necessary authority to examine this report and, if so agreed and if need be, to examine the governor of the Bank of Canada. The 90205-6-289J
Bank of Canada Report chairman of the banking and commerce committee, the hon. member for York North (Mr. Cathers), said he would take notice of my question but so far we have had no indication from him when the banking and commerce committee is going to meet.
Likewise, realizing that there was a procedural difficulty and bearing in mind the assertion of the Minister of Finance that this was a responsibility which the governor of the Bank of Canada owed only to parliament and not to the government, we have sought at various times during the course of the present session to obtain from the Minister of Finance his co-operation in having the report of the governor of the Bank of Canada referred to the committee on banking and commerce. This was done on April 27 when I asked the Minister of Finance if it was the intention of the government to move to refer the annual report of the governor of the Bank of Canada to the standing committee on banking and commerce or to any other committee of the house. The Minister of Finance replied as found on page 4042 of Hansard:
Mr. Speaker, following the question asked by the Leader of the Opposition, I really can see no advantage to parliament or to the public in that course.
That is the Minister of Finance who says he has no responsibility for monetary policy. This is a matter that concerns parliament, he says, and whatever authority the governor of the Bank of Canada has he has it from parliament directly and not through the government or the Minister of Finance. Yet, having taken that position, the Minister of Finance says, "I really can see no advantage to parliament or to the public in that course", as if it was the responsibility of the Minister of Finance to determine the collective judgment of parliament.
We ask the Minister of Finance and the government to let parliament decide whether it is in the public interest to take this course, and if ever there was a government that should not hesitate to accept this suggestion it is a government that has dedicated itself, according to its own admission, to the championing of the rights of parliament. Imagine a government that says it respects the rights of parliament as other governments have not and at the same time allowing this Minister of Finance to say that he sees no advantage to parliament or to the public interest in having the Bank of Canada report referred to a committee of the house, specifically the banking and commerce committee.


Mr. Benidickson:: A somersault from 1956 and 1957.

Bank of Canada Report


Paul Joseph James Martin: The hon. member for Kenora-Rainy River says it is a somersault from 1956 and 1957. This is one further example of the way in which this government's actions are inconsistent with its professed idealism about human rights and the rights of parliament. If the Prime Minister (Mr. Diefenbaker) believes in the rights of parliament as he says, if he really believes in the philosophy behind the bill of rights, why does he sit there next to the Minister of Finance and not give to parliament its responsibility which the Minister of Finance says belongs to it alone? In defence of my last observation the Prime Minister has a synthetic good humour displayed all over his face. The Prime Minister's conduct and that of the Minister of Finance in this and in so many other matters establish beyond doubt that there has never been a more arrogant and ineffective government than the government that now faces us.
But, Mr. Speaker, on April 27 the Deputy Speaker construed the words of the Minister of Finance as not implying that there was no advantage to parliament or to the public interest in that course. He interpreted the words of the Minister of Finance as every member of the house did and certainly as I did when he said, as found on page 4043 of Hansard:
Unless I am mistaken, the Minister of Finance has already indicated he does not consider this suggestion to be in the public interest.
Imagine the Minister of Finance using words which Mr. Deputy Speaker interpreted as saying that the Minister of Finance is of the view that it is not in the public interest to have the annual report of the Bank of Canada referred to the banking and commerce committee for careful scrutiny. Yet we have a Minister of Finance who, in defence of freedom in this house, paraded himself from the Speaker's chair to the entrance of the house, draped in the symbol of his professed love of liberty and of the rights of a free parliament. In spite of this, he will take no step, as Minister of Finance, to allow a committee of this house to examine the most important report placed on the table of this house since this session began, a report which deals with matters in which the governor of the Bank of Canada takes issue with the position taken by the government.
This, however, does not in any way relieve the government from taking a procedural step which is in accordance with the best parliamentary traditions and is in accordance with the rights of this house, namely to examine this report by the governor of the Bank of Canada, to determine whether or not the positions which he has publicly assumed bear any


relationship when they are contrasted against the policies of the government.


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


Paul Joseph James Martin: Yes.


Edwin William Brunsden: Is he prepared to accept the report of the governor of the Bank of Canada as the official view of the opposition?


Paul Joseph James Martin: In answer to the hon. gentleman, I may say that what I want to do is to find out whether this report does offer a solution for the most important single problem in our country, about which the government is doing very little, that is the problem of unemployment. The governor of the Bank of Canada has said that this nation has the capacity to resolve the problem of unemployment. This is fact No. 1. Fact No. 2 is that we have over 700,000 people out of work. The government is not resorting to policies which the governor of the Bank of Canada believes are capable of mitigating this problem. It is because I want to examine the governor of the Bank of Canada, and so do other members of the Liberal party, to ascertain whether or not there are solutions within the context outlined by the governor of the Bank of Canada in this report and certain public speeches, that I want the report referred to a committee. I say that is the right of every hon. member in this house.
There has been some talk about the rights of parliament in connection with this matter. The Minister of Finance was pressed by the Leader of the Opposition (Mr. Pearson) on April 27, Mr. Speaker, when he put this question to him as reported at page 4043 of Hansard:
*.. may I ask the Minister of Finance whether he considers it not to be in the public interest to refer the report of the governor of the Bank of Canada to the banking and commerce committee of this house.
Those were the words of the Leader of the Opposition, "does the minister not consider it in the public interest;" and I will read the reply of the Minister of Finance, this little man who, as I said, carried across his shoulders the symbol of the rights of a free parliament and a free people. This is what he said when speaking to this parliament made up of the elected representatives of the people:
Mr. Speaker, this is the third time this question has been asked in the house this afternoon.
We all remember how he seemed fatigued, how irritated he was when he began this soliloquy.
1 repeat the answer I gave to the question when it was asked the first time by the hon. member for Essex East, and I simply add to that answer the observation that I think will be generally

shared by all hon. members of the house and the public, namely that hon. members opposite, in either examination or cross-examination of the governor of the bank, could not do half as good a job as the senators did.
Now, Mr. Speaker, that may or may not be the case. What I am saying to the Minister of Finance is that he preferred to allow the other place in parliament, made up of ladies and gentlemen who are not elected by the people, to have the opportunity of examining a report which he denies to the elected representatives of the people in this house.


Donald Methuen Fleming: Rot and drivel.


Paul Joseph James Martin: No display of histrionics on the part of my friend the Minister of Finance will justify that course or will justify the refusal by him, in the name of the government, to refer this report to the banking and commerce committee or to any other appropriate committee of this house.
This is not the whole story, Mr. Speaker. On March 21, 1961, as recorded at page 3171 of Hansard, the Leader of the Opposition asked this question:
Mr. Speaker, in view of the great interest that has been aroused by statements of the governor of the Bank of Canada I should like to ask the Prime Minister whether he can see any reason why the governor should not be asked to appear before the banking and commerce committee which is now in session.
The Prime Minister replied as follows:
Mr. Speaker, questions like that are for the determination of the appropriate committee and decision by such committee.
Compare that answer with the statement of the Minister of Finance that he could see no good reason why, in the public interest, that particular course should be followed.
Then, I followed with this question:
I should like to ask a supplementary question of the Minister of Finance. In the event that the banking and commerce committee should decide to summon the governor of the bank, would the Minister of Finance, because of his relationship with the governor, provide any obstacle to acceptance on the part of the governor?
The Minister of Finance replied as follows:
The Minister of Finance does not create obstacles at any time in the way of doing anything that is proper-
Does the Minister of Finance say that this is an improper request? Does the Minister of Finance say that a request by the Liberal opposition in this house, supported by the other opposition group in this house, for an examination of this report by the banking and commerce committee is improper? If he does, let him say so right now. I dare the Minister of Finance to say that it is not in the interests of good government to examine the
Bank of Canada Report report of the governor of the Bank of Canada. The Prime Minister continues to laugh. The Prime Minister by that laugh indicates the real character of his bill of rights in so far as his sponsorship is concerned.


Douglas Scott Harkness: We are laughing at your histrionics.


Paul Joseph James Martin: The Prime Minister's synthetic interest in parliament is now apparent. If he believes in the rights of parliament, let him now, as leader of the government, get up and say, "Of course, it is a proper thing for a report of this kind to be sent to the banking and commerce committee." Let the Prime Minister take that course. If he sits silently in his seat, we can only judge him as having used this other instrument not for the purpose really intended by enactment but for the purpose of seeking to give to the Canadian people an impression which is not justified under the circumstances.
Then, on December 8, 1960, we have the Minister of Finance intervening in a speech by the hon. member for Assiniboia (Mr. Argue), as reported at page 610 of Hansard. The hon. member for Assiniboia said:
Since the whole question of central bank policy has been raised by those economists, would it be the intention of the government to refer the annual report of the Bank of Canada to the banking and commerce committee so that we could hear witnesses on this whole question, including the governor?
I would ask you, Mr. Speaker, to listen to these words of wisdom by the Minister of Finance and contrast them with some of the earlier observations he made:
Mr. Speaker, if and when suitable committees of the house are appointed for the purpose and after the receipt of the annual report of the governor, I presume then it would be a matter for decision on the part of the house. The annual report of the governor normally reaches the Minister of Finance in late March.
In the light of the statement which was made during a speech of a member of the party sitting immediately to Mr. Speaker's left, I say to the Minister of Finance that there is now a strong demand in this house by those who confront the government for the right to examine the governor and to examine his report and that, in the face of this statement made by the Minister of Finance on December 8, the government can take no other course but to accede to our request.


An hon. Member:: Did you ever do that?


Paul Joseph James Martin: We were never asked under these circumstances, but I will say this to my hon. friend. When a demand was made in this house-I think it was in 1956-for the right of the banking and commerce committee to examine the governor

Bank of Canada Report of the bank, that examination took place. The governor of the Bank of Canada appeared before the banking and commerce committee and he was interrogated by the present Minister of Finance, the hon. member for Greenwood (Mr. Macdonnell) and others without any attempt on the part of the administration to restrict the governor of the Bank of Canada in the discharge of what under the laws passed by this house is his clear, legal responsibility. Not only the present governor of the Bank of Canada but Governor Towers appeared before parliamentary committees as a result of the initiative taken by the government of the day. Yet, although there is greater provocation now than there was then because of the position taken by the governor with regard to the solution of our problems, this government refuses to enable us to get over certain procedural hurdles so that this matter can be referred to the banking and commerce committee.
Because there is no opportunity of correcting our procedures and because there is no way by which a private member of this house, unaided by the government, can deal with procedural effectiveness in this regard, one has no other alternative but to rise as I am doing tonight in order to express this grievance. Having in mind what this report contains and having in mind the fact that the governor of the Bank of Canada says he has the solution to the problem of unemployment, I would suggest that there is no greater responsibility presented to us with regard to domestic problems this session than that which is involved in this particular matter.
How can the Minister of Finance take the position that he will not facilitate the members of this house to examine this report? What reason does he give? He says, "I see no advantage". He may not see any advantage. He and the governor of the Bank of Canada have obviously had their differences. I can understand his saying that he cannot see any advantage. However, in the public interest there may be a great advantage because from the governor of the Bank of Canada we may ascertain the details of the kinds of solutions which in general terms he has been expounding throughout the country and indeed which he repeats in this annual report.
It may be that in the examination of these details we shall find that the governor of the Bank of Canada has laid before the government these very details; and that will afford the government an opportunity of explaining, if that is the case, why it has not accepted the proposals of the governor of the Bank of Canada. At any rate, parliament will then not be denied the opportunity of examining carefully a document which it


is not only its right to examine but which, under the Bank of Canada Act, section 20, it is its duty to examine.
If the governor of the Bank of Canada is responsible only to parliament for monetary policy, then surely the Minister of Finance cannot take the position he takes. I referred to section 20 of the Bank of Canada Act; I meant section 18 in which the business and the powers of the bank are set out clearly. The Minister of Finance says those powers are given by parliament not to the government but to the governor of the Bank of Canada. The governor of the Bank of Canada, pursuant to that act, makes his report. Yet this government denies us the right which was open to another place to determine the details of this report.


Mr. Jones:: I wonder whether the hon. member would inform the house as to his precise position? Is his position that he does not know whether or not he agrees with the governor of the Bank of Canada?


Paul Joseph James Martin: Mr. Speaker, if there is any other supplementary reason needed for calling the governor of the Bank of Canada before a parliamentary committee, it is to educate such hon. gentlemen as the one who has just put such a question.


Henry Frank Jones: Mr. Speaker,-


Some hon. Members:: Sit down.


Henry Frank Jones: Mr. Speaker, I should like to ask a question.


Mr. Speaker:: Order. Unless the hon. member who has the floor yields it, the hon. member may not ask a question.


Paul Joseph James Martin: I wish to incorporate as part of my statements a comment made in the Montreal Star relating to this very matter. I refer to an editorial on May 1 in which the editor of the paper states as follows:
Why, then, would his appearance before this committee be unwise? If Mr. Coyne is free to discuss his theories before clubs and groups across Canada, why should he not be free to discuss them before M.P.'s whose job it is to inquire into major topics of public interest? On the surface at least, the government did not try to restrain Mr. Coyne from his public speech making;-why lower the boom now,-


Mr. Speaker:: Order. The first part of the quotation seemed to have no reference to acts within this chamber; but as the editorial goes on, it appears that it is reflecting on acts of the government as expressed in this chamber and I would therefore ask the hon. member to refrain from reading further from it.


Paul Joseph James Martin: On a point of
order may I say this. I was incorporating it as my own opinion. However, that is not the

point. The point is that this editorial, as I have indicated, expresses a view that the government-


Mr. Speaker:: Order. I hear the banging of a desk cover. Is the hon. member having difficulty with his desk?


Edwin William Brunsden: Mr. Speaker,-


Mr. Speaker:: Is the hon. member raising a point of order?


Edwin William Brunsden: Yes; I am raising a point of order. I was trying to draw from the hon. member for Essex East a little while ago a declaration as to whether he was endorsing the viewpoint of the governor of the Bank of Canada.


An hon. Member:: That is not a point of order.


Mr. Speaker:: If the hon. member has a point of order, will he please state it?


Mr. Denis:: He has no point of order.


Paul Joseph James Martin: I have no objection, Mr. Speaker, to efforts made by those who support the government to prevent an exposition-


An hon. Member:: An exhibition.


Paul Joseph James Martin: -of what I believe will be regarded by those who examine this situation to be on the part of the government a violation not only of the rights of parliament but of the Bank of Canada Act. The responsibility for this course will rest on the government and it will be a responsibility which the Minister of Finance alone will not have to bear. In a country where one of the government's chief functionaries takes the position, as does the governor of the Bank of Canada, that there are solutions to this most serious domestic problem of unemployment, it is shameful that parliament made up of the elected representatives of the people should be denied the opportunity of ascertaining the validity of the submissions which he makes.
We have been denied that opportunity until now. I ask the government to give us that opportunity. If they refuse, then they will stand indicted once more as thwarting positive efforts to try and deal with this serious problem of unemployment.


Mr. Heward Graffiey (Brome-Missisquoi):: Mr. Speaker, in my few brief remarks this evening following the hon. member for Essex East (Mr. Martin) I should just like to point out one thing. I do not believe the hon. member who has just spoken would recognize sincerity if he saw it, because if there is one thing the Canadian people realize today it is this, that no government in the
Bank of Canada Report history of this country has had a greater respect for the rights of parliament than this one.


Lester Bowles Pearson: I have seen no advantage.


William Heward Grafftey: The hon. member likes to pretend that we have a big, massive, rolling majority. It so happens-as we all realize- that the vote of the Canadian people has placed us here. Certainly the people in my constituency in particular, and I know the people in this country in general, realize that no government has recognized more than this one what are the real rights of parliament. So no sham speech and no sham remarks such as we have heard tonight will convince me, other hon. members of this house or the people of this country, otherwise.
The second comment I should like to make is this. The hon. member for Essex East made a very interesting statement. He said that if the governor of the Bank of Canada were brought before a committee he would do just this; he would ask him specifics, all kinds of specifics. Did the hon. member not read a few of the reports of the meeting of the committee of the other place which occurred a few days ago, when hon. gentlemen of the other place asked the governor of the Bank of Canada persistently for specifics, and these were exactly what the governor of the Bank of Canada said he could not give?
As governor of the Bank of Canada he said he would not, could not and would never, at any time, I should imagine, whether it were in front of a committee of this house or before the public at large, enter into the arena of specific government policy.
I can just see what would happen if the hon. member for Essex East got the governor before such a committee-


John Whitney Pickersgill: Why not let us find out?


William Heward Grafftey: -because I was a member of the labour relations committee when the hon. member for Essex East badgered the governor of the Bank of Canada in an unseemly manner to try to drag him into the arena of partisan politics.


William Moore Benidickson: Before $60 million of capital losses were established.


William Heward Grafftey: Time and time again the hon. member for Essex East tried to drag the governor of the Bank of Canada, when he was appearing before the labour relations committee, into the narrow arena of partisan politics. He simply was not successful, and everybody who sat on that committee saw this disgraceful performance.
I suggest the hon. member has already served notice to parliament and to the people of this country as to exactly what he would

Bank of Canada Report do if the governor came before such a committee. The hon. member would draw him once again into the arena of narrow partisan politics. Specifics would be asked for, when we have been told they cannot be asked for. I think this is a logical answer to what the hon. member for Essex East seeks.
I should also like to say this. I think all hon. members of this house and the people at large should note well one statement made by the hon. member for Essex East, who said he was speaking for his party at large. The hon. member said, and perhaps I agree with him, that the government is responsible for the policy and the acts of all emanations of the crown. This is a very interesting statement made by the hon. member for Essex East and it is one I think it would be well for us to remember in future debates on other aspects of government policy.
I can only say this. The rights of parliament are being adhered to by this government and I think all hon. members of this house realize that the governor of the Bank of Canada cannot be dragged into partisan, political debate where specifics which cannot be asked would be requested. I think this is where the test of sincerity lies.


Mr. Erhart Regier (Burnaby-Coquiilam):: Mr. Speaker, I should like to begin by assuring the minister that I have no intention of denying him adequate time to reply to the particular grievance that has been raised. However, I must rise to support the grievance raised by the latest candidate for the new party leadership, namely the hon. member for Essex East (Mr. Martin). I consider it-


Some hon. Members:: Oh, oh.


Paul Joseph James Martin: Would the hon. member permit me to point out-


An hon. Member:: Don't be hasty.


Paul Joseph James Martin: -that the Liberal party is indeed the "new" party.


Erhart Regier: I know that the hon. member who raised the objection is not referring to the Liberal party of the past. However, as I indicated earlier, I consider it an insult to the sovereignty of parliament when the man who is the governor of the Bank of Canada is denied the opportunity to meet with a committee of this parliament and yet has to appear before a committee of the other place. The other place, as has already been pointed out, consists of appointed people and it is not representative of the Canadian people in that its members have not been elected by the Canadian people.
To me the money supply of a country is almost identical to the blood supply in our
[Mr. Grafftey.l

bodies. If the bloodstream is inadequate or is diseased there is very little that can be done until this has been remedied. There is a feeling all over Canada that present monetary policy is not meeting the needs of the nation. I believe it is high time the operations of the Bank of Canada were subjected to a review by the banking and commerce committee or a specially appointed committee of this house, if the government so desires. This committee should have the chance to examine the opinions of the officials of the Bank of Canada and their reports.
The hon. member for Brome-Missisquoi (Mr. Grafftey) attempted to make a great point of the fact that the governor of the Bank of Canada is unable or would refuse to answer specific questions. I cannot buy that argument at all, because the governor of the Bank of Canada is an employee of the people of Canada and he is accountable for all his actions to the elected representatives of the people of Canada.
I should like to know what is the hidden mystery that must remain hidden at all costs at this time; why this government should refuse to reveal to the public and to the representatives of the public exactly what is happening in the field of monetary policy.
We have been told so many times by the Minister of Finance (Mr. Fleming) that he is not responsible for the activities of the Bank of Canada. I deny that assertion of his; I deny it most vehemently, because the Minister of Finance, according to the terms of the Bank of Canada Act, is the sole owner of the Bank of Canada on behalf of the people of Canada. The Minister of Finance is certainly responsible for each and every activity of the Bank of Canada. However, even assuming that the minister's assumption was adequate and accurate and that the Bank of Canada is responsible not to the government but to parliament, in the same breath the minister by his actions is denying the right of parliament to examine this organization which, he claims, is responsible to parliament. I should like to ask the hon. gentleman in what way is the Bank of Canada responsible to parliament if parliament is denied the right to examine its operations? Is this bank to operate in a vacuum, in a world of its own? It is not responsible to him, he claims, and at the same time he refuses to allow it to become the responsibility of parliament.
I should like to meet with officials of the bank in the banking and commerce committee. I should like to hear their report and their opinions with regard to exactly what happened in connection with the bond conversion deal, a deal which was primarily responsable for increasing interest rates on

all public indebtedness in Canada by over 2 per cent since this government took office. I should like to have the opinion of the management of the Bank of Canada in this regard. It must be remembered that an increase of 2 per cent is not a small matter; it is not a consideration to be lightly dismissed. Assuming an indebtedness on the part of public bodies of $20 million a year, an increase of 2 per cent means an added burden of $400,000 to the taxpayers of Canada. Assuming, further that over-all indebtedness in Canada including that of government runs to approximately $200 million, an increase of 2 per cent adds a burden to our cost of production and to our consumer prices of over $4 million a year. I should like to have the opportunity to ask the authorities of the Bank of Canada whether or not this bond conversion deal was really urgent and necessary at the time it was undertaken.
We now have another proposal offered by the government, namely the proposal that the government ought to dump on the money market $750 million worth of mortgage paper that it owns. If this has to be discounted at 10 per cent in order to make it marketable it may mean a loss to the Canadian taxpayer of $75 million. I should like to ask the opinion of the governor of the Bank -of Canada as to what the effect might be of the government unloading on to the money market $750 million worth of securities. I should also like to ask the governor of the Bank of Canada what he thinks of a reported claim on the part of the Prime Minister (Mr. Diefenbaker) as appears in the Globe and Mail of Monday last-


Mr. Speaker:: Order. The hon. member has departed from the grievance. The grievance has nothing to do with reported claims.


Erhart Regier: I was only attempting to support the grievance and to express my opinion as to why we ought to be able to interview the governor of the Bank of Canada. I meant to read out a statement which was made last weekend by the Prime Minister having to do with monetary policy. I was about to place that on the record and show why I would welcome the opinion of the governor of the bank with respect to it.


Mr. Speaker:: The hon. member may illustrate his reasons for thinking that the governor of the bank should be brought before a committee of the house for examination but he is not at liberty to go into all the matters that might be raised during an examination. If we allowed all those matters to be debated there would be no limit to the grievance. The grievance is a narrow and succinct matter and the hon. member must confine himself to it.
Bank of Canada Report


Erhart Regier: I must accept your ruling, Mr. Speaker, and I will gladly do so though I have never heard before of our being denied the right to give reasons as to why we support an argument.
Money supply in a nation is similar to the blood supply in a human body. We do not know on any real authority whether this country can afford a further expansion of the money supply. We are being denied expert knowledge in relation to this important subject. We are being denied information as to whether or not anti-inflation measures would have to accompany any expansion of the monetary supply. We have no access to guidance as to what those measures might be and which measures would be advisable. We seem to be following a policy which, I believe, has proved to be a complete failure, namely, that a nation is able to borrow itself into eternal prosperity. This, in my books, does not add up.
I know we have lived on this particular theory ever since 1945 but I contend that no nation is able to create money by using its printing presses; money which is, therefore, worthless and inflationary. I also contend that no nation can continue to borrow itself into prosperity forever, because eventually the day of reckoning comes. I believe the government of the day may be somewhat unfortunate in that it happens to be in office at the present time when the day of reckoning is arriving at long last. I should like to have the Bank of Canada tell us whether it considers that it is inadequate to handle its basic assignment unless it is also given complete authority over credit sales as well as over currency. I should also like to ask whether in its opinion the insurance and investment houses of Canada ought not to be brought under the broad jurisdiction of the bank along with the chartered banks.


Donald Methuen Fleming: The hon. member for Essex East (Mr. Martin) has regaled us this evening- I think that is the word-by one of his champion matinee performances. This kind of performance, on first hearing, is very impressive. The second time it is moderately impressive. The third time, less impressive; the fourth time, still less impressive, the fifth time unimpressive, the sixth and succeeding times a little difficult to listen to by reason of infinite repetition. The hon. member should vary his act a little once in a while, give a little fresh flavour to it. It would make his performance a little more interesting, if I might make that suggestion to him. The typical mood in this burlesque performance is that of synthetic indignation.

Bank of Canada Report
Mr. Speaker, you will remember the story from the public school reader of years ago about the boy who cried wolf, wolf, wolf so often that the people ceased to pay any attention to him. I think the hon. member for Essex East has long since passed that position. As a matter of fact, as a demonstration of synthetic indignation, as an attempt to whip up an issue where he well knows there is no justification for an issue or for the attacks he has made, one can say his performance tonight was of the ersatz variety.
It is interesting also that the hon. member for Essex East, apart from being the opposition critic on numerous matters such as health and welfare and-


Edwin William Brunsden: Agriculture.


Donald Methuen Fleming: -and agriculture, has now evidently taken the position of opposition critic on monetary policy.


John Whitney Pickersgill: Mr. Speaker, I rise on a point of order.


Some hon. Members:: Sit down.


John Whitney Pickersgill: Mr. Speaker, I rise on a
point of order.


Mr. Speaker:: Order. I recognize the hon. member for Bonavista-Twillingate (Mr. Pickersgill) .


John Whitney Pickersgill: Mr. Speaker, I think that the hon. gentleman is raising a new grievance. There are other members who wish to speak on the grievance raised by the hon. member for Essex East, but apparently the grievance of the hon. gentleman, who is speaking now, has regard to the conduct of the hon. member for Essex East, and while many of us would find that subject very entertaining to speak on-


Some hon. Members:: Hear, hear.


John Whitney Pickersgill: -I suggest that the
ordinary rules of the house should apply to the Minister of Finance (Mr. Fleming) as they are applied to other hon. members of the house, and that the minister should either speak on the grievance raised by the hon. member for Essex East or give the floor to someone who may wish to do so.


Mr. Speaker:: A certain number of personal references are a part of debate, but if they are prolonged they would, of course, amount to another grievance.


Donald Methuen Fleming: Mr. Speaker, so far as the point of order is concerned, obviously it is ersatz too. I might say, concerning the point raised by the hon. member for Bonavista-Twillingate, that he knew very well when I started to speak I was left only nine minutes by the previous speakers and


he is obviously now trying to use up some of those nine minutes by raising this point of order.


Lester Bowles Pearson: Why do you not refer to the subject?


Donald Methuen Fleming: Mr. Speaker, there was a time when-


Lester Bowles Pearson: Why do you not refrain from discussing personalities?


Donald Methuen Fleming: There was a time when the expression "procrastination is the thief of time" meant something, but that, of course, was before the days of the hon. member for Bonavista-Twillingate.


Lester Bowles Pearson: You have four minutes left, why do you not use them?


John Whitney Pickersgill: Why do you not refer to the Bank of Canada report?


Donald Methuen Fleming: Mr. Speaker, the annual report of the governor of the Bank of Canada was referred to the standing committee on banking commerce once, and that was in the year 1956. There was a very good reason at that time why that report was so referred. There had been a great deal of discussion on the subject of monetary policy-


John Whitney Pickersgill: There has been none, of course, this year.


Donald Methuen Fleming: -which apparently influenced the minister of finance of that time after some discussion of a general nature that preceded the introduction, not at the time of introducing the motion-to bring in a motion, on his own account, to have that report referred to the standing committee on banking and commerce for study and report.


William Moore Benidickson: Yes, because the hon. member for Greenwood (Mr. Macdonnell) asked for it.


Donald Methuen Fleming: Yes, there had been some discussion some time before, and the minister of finance at that time was very unhappy about what had been said to him apparently, and he brought in a motion to have that report referred to that particular committee. That is the one occasion on which this was done.


Lester Bowles Pearson: It was done the year before.


Donald Methuen Fleming: That was the one
occasion when the report of the governor of the Bank of Canada was referred to a parliamentary committee.


Lester Bowles Pearson: It was apparently done the year before.


Donald Methuen Fleming: On other occasions, Mr. Speaker-


Lester Bowles Pearson: Mr. Speaker, on a point of order, the Minister of Finance has just made a statement which is incorrect, because the governor of the Bank of Canada on that occasion in 1956 began his evidence by saying that it was a pleasure for him to be back with them again, meaning the members of the committee.


Mr. Speaker:: Order.


Donald Methuen Fleming: Mr. Speaker, any honest person who reads the evidence of that occasion will realize that what the governor was referring to was an appearance, not in connection with the reference of the annual report to that committee, but in respect of an entirely different matter. He has appeared before committees before, but only on one occasion following a reference of the governor's report to that committee.
The position taken here is perfectly clear. Hon. members of the opposition are trying to disclaim any responsibility with respect to the contents of the report-


Some hon. Members:: Oh, oh.


Donald Methuen Fleming: They do not want to have any responsibility for the contents of that report of the governor, but want that responsibility to be accepted by-


John Whitney Pickersgill: Mr. Speaker, may I ask the
minister if he accepts responsibility for-


Donald Methuen Fleming: No, sit down. They are asking the government to take the responsibility for having this report referred to the committee, and the minute that is done they-


Lester Bowles Pearson: Does the government not accept any responsibility in regard-


Donald Methuen Fleming: Mr. Speaker, you know perfectly well that they would be very quick to claim that the responsibility for the statements made in the annual report of the governor of the Bank of Canada was that of the government.


Mr. Speaker:: Order. If there is a matter of contradiction it should be referred to at the end of the hon. minister's statement.


Lester Bowles Pearson: Mr. Speaker, on a point of order. The minister has referred to-


Mr. Speaker:: Order.


Donald Methuen Fleming: This is an attempt to steal more of my time.


Lester Bowles Pearson: Mr. Speaker, on a point of order.


An hon. Member:: It is ten o'clock.
Bank of Canada Report


Donald Methuen Fleming: This is an attempt to steal my time, and surely that is against the rules of this house.


Lester Bowles Pearson: Mr. Speaker, my point of order is that the Minister of Finance has misrepresented the position of the opposition regarding this matter.


Mr. Speaker:: Order. This is a matter of personal explanation which can more appropriately be made when the minister has completed his statement.


Donald Methuen Fleming: Mr. Speaker, I suggest that what has taken place here is an attempt to create the impression in the mind of the public that the government is responsible for the opinions expressed by the governor of the Bank of Canada in this report, but I want to state again-


John Whitney Pickersgill: Mr. Speaker, I rise on a question of privilege.


An hon. Member:: Sit down.


Donald Methuen Fleming: -that the government does not take the responsibility for these expressions of opinion by the governor of the Bank of Canada as contained in the annual report.


John Whitney Pickersgill: Mr. Chairman, I rise on a question of privilege.


Mr. Speaker:: Order.


John Whitney Pickersgill: I am rising on a question of privilege.


Mr. Speaker:: Order.


John Whitney Pickersgill: Mr. Speaker, I am rising on a question of privilege.


George Clyde Nowlan: Order; the Speaker is on his feet. Sit down.


Mr. Speaker:: Order. There will be neither speech or privilege, as it is ten o'clock.


Donald Methuen Fleming: Mr. Speaker am I to have my time stolen from me this way?


John Whitney Pickersgill: It is ten o'clock.


Mr. Speaker:: Order.


Donald Methuen Fleming: What a shameful performance.


Mr. Speaker:: It being ten o'clock it is my duty, pursuant to section 3 (f) of standing order 56 as provisionally amended, to interrupt these proceedings and forthwith put the question on the motion now before the house.
Motion agreed to and the house went into committee, Mr. McGee in the chair.
The estimates of the following departments were first taken up and entered for consideration.

Business of the House
DEPARTMENT OF FORESTRY 152. Departmental administration, $1,090,452. DEPARTMENT OF MINES AND TECHNICAL SURVEYS Departmental administration-
202. Administration, operation and maintenance, $1,087,947.
DEPARTMENT OF SECRETARY OF STATE 387. Departmental administration, $332,439. Proceedings reported.



BUSINESS OF THE HOUSE

John William Kucherepa: Mr. Speaker, will the acting house leader indicate the order of business for tomorrow?


George Clyde Nowlan: Mr. Speaker, in view of what has taken place during the past 15 minutes I do not think there is any point in indicating the business for tomorrow because it will undoubtedly be disrupted.


Some hon. Members:: Oh, oh.


Mr. Speaker:: Order.


Paul Joseph James Martin: That is a shameful statement. The minister is replying to one of his own party members.


Mr. Speaker:: Order.


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


[Stage Direction]
General
A further meeting of the Canada-United States interparliamentary group was held in Ottawa and Quebec city from Wednesday, February 22, to Sunday, February 26, inclusive.
This was the fourth meeting of the group which continued its procedures of having informal, off the record discussions and refrained from making recommendations, leaving it to each national delegation to make such reports and recommendations to its respective legislatures as it determines.
The group met in plenary sessions on Thursday morning and Friday afternoon. Committee meetings were held on both days. Committees discussed the following subject areas:
(1)	Defence co-operation and disarmament;
(2)	Trade and economic matters; and
(3)	Boundary matters, cultural affairs and foreign policy matters of common concern.
At the first plenary session, the Secretary of State for External Affairs, Hon. Howard Green, gave a brief address of welcome. Later in the day the United States delegates visited both houses of parliament and were welcomed in the House of Commons by addresses given by the Prime Minister, Right Hon. John G. Diefenbaker, the Leader of the Opposition, Hon. Lester B. Pearson and the C.C.F. leader, Mr. Hazen Argue, and in the Senate by the Speaker and honourable Senators Walter M. Aseltine, W. Ross Macdonald and others. At a lunch on Friday, given by the Speaker of the House of Commons in historic room 16 in the parliament buildings, the Prime Minister, Hon. Lionel Chevrier, Senator George Aiken and Representative Cornelius E. Gallagher spoke at a ceremony to dedicate a plaque to be installed there in commemoration of the first formal meeting of Canadian and United States parliamentarians in that same room in 1943. On Friday evening the government of Canada gave a dinner for the group in the parliamentary restaurant to which all members of the Senate and House of Commons were invited. In addition, there was a lunch for the delegates given by the Speaker of the Senate and a program of lunches, receptions and tours for the wives.
On Saturday and Sunday the group visited Quebec city to see something of winter life in la belle province. The weatherman was more than co-operative. He let loose an unusually severe blizzard which disrupted all
transportation and delayed the return of the delegations to their capitals until Monday.
Committee discussions
The discussion in the committees, the personnel of which is shown in Appendix A, was frank and animated, but was always carried on with complete good humour and respect for divergent views. Some differences were reconciled, others were explained and modified in the course of exchange of information and opinion. There was nothing to limit discussion other than time itself, and most of the important problems which could be said to disturb our neighbourly co-operation came up for attention. The scope of these discussions in the committees is indicated by the reports which are set out in Appendix B, in the form in which they were approved at the final plenary session and released in a joint press statement on February 24th.
Conclusions
All delegates appeared to be well satisfied with this latest interparliamentary exchange and convinced of the usefulness of this approach to joint problems and differences as well as of the soundness of the decision that two meetings of the group should be held annually, one in each country. The hope was expressed that the second meeting in 1961 could be held in Washington during the present session of congress.
It is noteworthy that in the first four meetings the change in personnel of the delegations has been such that no less than 52 members of congress and 55 members of the Canadian parliament have already participated.
The wives of most of the delegates have accompanied them. It has been well said that this more than doubles the effectiveness of the exchange in the promotion of good will and understanding.
In submitting this report we wish to express our appreciation of the co-operation and assistance of officials of the various departments of the Canadian government who have helped us with the organization of the meetings and in our preparation for the discussions.
Dated at Ottawa, May 2nd, 1961.
Mark Drouin	Roland Michener
Speaker of the Senate Speaker of the
House of Commons Joint Chairmen.


[Stage Direction]
The delegates, arranged according to the committees on which they served, were the following:
COMMITTEE I-Defence co-operation and disarmament
United States delegation
Senator Thomas J. Dodd (co-chairman) Representative Wm. S. Broomfield (co-chairman) (R)
Senator J. Caleb Boggs (R)
Senator Hiram Fong (R)
Representative Harold D. Donohue (D) Representative Philip J. Philbin (D) Representative Samuel S. Stratton (D)
Canadian delegation
(D)	Hon. Mark Drouin (chairman)
Senator P. H. BoufEard (L) Mr. Egan Chambers (P.C.)
Mr. H. M. Batten (L)
Mr. John B. Hamilton (P.C.) Mr. James McGrath (P.C.)
Mr. R. Bourdages (P.C.)
Mr. John MacLean (P.C.)
United States delegation
Senator Ralph W. Yarborough (co-chairman) Representative Edna F. Kelly (co-chairman) Senator B. Everett Jordan (D)
Senator Vance Hartke (D)
Representative Thaddeus J. Dulski (D) Representative Glenn C. Cunningham (R) Representative James Harvey (R)
economic matters
Canadian delegation
Hon. Roland Michener (chairman) Senator Norman Lambert (L) Senator W. R. Brunt (P.C.)
Mr. J. Pallett (P.C.)
Mr. G. J. Mcllraith (L)
Mr. K. H. More (P.C.)
Mr. Jean-Paul Racine (L)
Mr. E. M. Woolliams (P.C.)
COMMITTEE II-Trade and
(D)
(D)
COMMITTEE III-Boundary matters, cultural affairs and foreign policy
United States delegation
Senator George D. Aiken (co-chairman) (R) Representative Cornelius E. Gallagher (co-chairman) (D)
Senator Lee Metcalfe (D)
Senator Gordon Allott (R)
Representative William T. Murphy (D) Representative Laurence Curtis (R) Representative Stanley R. Tupper (R)
Canadian delegation
Hon. Paul Martin (chairman) (L) Senator S. J. Smith (L)
Senator (Mrs.) J. D. Quart (P.C.) Mr. Paul Martineau (P.C.)
Mr. A. Denis (L)
Mr. H. W. Herridge (C.C.F.)
Mr. William Payne (P.C.)
Mr. G. J. Valade (P.C.)