1961-03-28

Hon. Howard C. Green (Secretary of State for External Affairs):: Mr. Speaker, this afternoon it is my privilege to say a few words of welcome to Hon. Koca Popovic, the foreign minister of Yugoslavia, and Mrs. Popovic, who are visiting in Ottawa for a day or two.
As hon. members know, Mr. Popovic represents a country which has shown great courage and great steadfastness, and which has been our ally in two world wars. Both the foreign minister and his wife were officers in the partisan army. The minister eventually became the commander in chief of that force, and both had very distinguished careers in those trying days.
Since the war the minister has taken a very active part in the work of the United Nations, where his country has stood for peace and has always taken a stand which would lead in that direction. Yugoslavia, like Canada, is one of the middle powers of the world today, and one of the powers which depends so much on an effective world organization.
It is very significant that in far-away Palestine there are several hundred young Yugoslav soldiers serving beside approximately the same number of young Canadians in the United Nations emergency force. They have been participating together there now for some years, making a great contribution, which I think sometimes Canadians are inclined to forget.
Therefore, under all these conditions it is a very happy occasion for me to be able to welcome the minister and his wife to Canada and in particular to the House of Commons.


Hon. L. B. Pearson (Leader of the Opposition):: Mr. Speaker, on behalf of the opposition I should like to associate ourselves with the welcome which has been expressed by the Secretary of State for External Affairs to the foreign minister of Yugoslavia and his wife. We welcome them, Mr. Speaker, not only on their own behalf but because the foreign minister represents a country which in the past has fought fearlessly for its freedom against all aggressors, and we know it will continue to do so in the future.
90205-6-215


Mr. H. W. Herridge (Kooienay West):: Mr. Speaker, the members of this group wish to associate themselves with the Secretary of State for External Affairs and the leader of the official opposition in extending a most hearty welcome to the foreign minister of Yugoslavia, about whose great achievements we have all heard and read. He proved his mettle and successfully fought against nazi terror, nazi brutality and nazi viciousness. Anyone who has done that has a very deep affection in our hearts. We wish him a most happy, fruitful and enjoyable stay in Canada.



URANIUM POLICY


Mr. Hazen Argue (Assiniboia):: Mr. Speaker, I ask leave to move the adjournment of the house under standing order 26, for the purpose of discussing a definite matter of urgent public importance, namely the need for the Canadian government to remove the present state of confusion in the uranium industry by making an immediate statement of policy that will assure the Canadian uranium industry, and employees engaged therein, of (a) minimum quantities of uranium that it will insist shall be purchased by Britain as a result of the commitment made for purchase of uranium during the period April, 1963 to December 31, 1966; (b) the general basis of allocation of the market within the industry; (c) the maintenance of uranium communities such as Uranium City, Elliot Lake, Bancroft.


Mr. Speaker:: If I understand the hon. member's request, it is to interrupt our proceedings under rule 26 to discuss a matter of urgent public importance, and that the matter of urgent public importance is the need for a statement of policy by the government with respect to the uranium industry?


Hazen Robert Argue: Yes, Mr. Speaker. With respect to the question of urgency, we believe there is a great state of confusion in the uranium industry in our country at this time that has not been cleared up by the statements made in the house yesterday, and this confusion is brought about because of the uncertainty in the public mind with regard to the quantities of uranium that will be sold under the contract, or under the commitment
3404	HOUSE OF
Inquiries of the Ministry made between Canada and the United Kingdom. By this motion we are asking as a matter of urgency that the government should state to the country now the immediate quantities of uranium that the Canadian government will insist that Britain purchase from Canada on the basis of the commitment to which the Prime Minister has referred. After that has been stated there should be some indication of the general basis of allocation of this market within the industry in Canada so the various components of the industry will know their economic position and, further, so the uranium communities in Canada such as Uranium City, Elliot Lake, Bancroft and others will be assured that they will be maintained over this period.


Mr. Speaker:: I think it is unnecessary to consider the matter further. It seems to me that the hon. member's interest in this matter should be expressed at a time provided by the general rules of the house rather than in a special debate under rule 26 which would interrupt all other proceedings. My view that this matter does not come strictly within the rule is based partly on the sittings of a committee of the house which has this matter before it and where there is ample opportunity to inquire into and deal with the problem of uranium supplies and marketing. In fact I think the issue has come to the fore through that committee which has not yet reported.
Furthermore, from listening to the discussion of this matter in the house it appears that the main controversy is over the sale of uranium to the United Kingdom between the years 1963 and 1966. Therefore it seems to me that parliament will have ample opportunity to deal comprehensively with this important matter in the course of its ordinary proceedings and at the usual time.



TEXTILES


[Stage Direction]
On the orders of the day:
Hon. Lionel Chevrier (Laurier):: Mr. Speaker, I should like to direct a question to the Minister of Finance. Is the minister in a position to state whether it is the intention of the government to provide additional tariff protection to Canadian manufacturers against the import of textiles from Hong Kong?


Hon. Donald M. Fleming (Minister of Finance):: Mr. Speaker, tariff questions are normally reserved for the budget, as I think the hon. member is very well aware.


Lionel Chevrier: I should like to ask a supplementary question. If that is the minister's


answer, is it the intention of the Canadian government to rely on the escape clause in GATT to bring this about?


Donald Methuen Fleming: As I indicated yesterday this situation, on which I gave the house a report yesterday, is now under examination in the light of the fact that the Hong Kong authorities have indicated that they do not propose to apply any restraints on exports from Hong Kong to Canada in the interests of orderly marketing in Canada. It rests then with the Canadian government to decide, subject to the approval of parliament, as to the proper course to be taken in the light of this now ascertained fact.


Lionel Chevrier: May I ask a further supplementary question. Does the Minister of Finance intend to follow the advice of the Minister of Trade and Commerce, who in Toronto yesterday called for competitive effort, not higher tariffs, to increase industrial production?


Donald Methuen Fleming: Mr. Speaker, I warmly associate myself with all calls for effort on the part of Canadian producers that they be competitive not only in holding their markets in Canada and abroad but in expanding those markets.


Lionel Chevrier: I hope you will keep the Minister of Trade and Commerce in tow.



URANIUM


[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: May I ask the Minister of Trade and Commerce whether since his last reference to this matter on March 6 he has received from the British authorities any indication that they do not intend to honour the firm contract for 24 million pounds of uranium, delivery to be made commencing March 31, 1963?


Hon. George H. Hees (Minister of Trade and Commerce):: I have had two discussions with the British high commissioner, and we both expressed ourselves very clearly on this matter. I think we understand each other's point of view very clearly now.


Lester Bowles Pearson: May I ask a supplementary question. Does the minister's reply indicate that this firm contract-those are the words of the minister-will be honoured by the United Kingdom government?


George Harris Hees: I have every hope it will, Mr. Speaker.


Hazen Robert Argue: I wonder if the Minister of Trade and Commerce can

inform the house what quantity of uranium is provided for in the firm part of the contract.


George Harris Hees: I think the hon. member for Assiniboia knows as well as I do the figure that has been mentioned.
I might clarify the term "Arm contract", which has been laboured slightly by both the hon. member and the Leader of the Opposition. As both these hon. gentlemen know, the exchange of letters between the British atomic energy authority and the Eldorado company are in fact a firm undertaking by the Eldorado company to supply 12,000 tons of uranium to the British atomic energy authority between March 31, 1963 and December 31, 1966, and an equally firm undertaking by the British atomic energy authority to receive the 12,000 tons of uranium and pay for them.
The Prime Minister said yesterday that no formal contract has been signed between the two entities. In referring to the exchange of letters as a firm contract when I spoke in the house on March 6, I was expressing my own feeling about such an exchange of letters, which to me is a firm undertaking on the part of both entities.


Lester Bowles Pearson: Will the minister confirm the statement that there is a firm undertaking on the part of the United Kingdom government to purchase from Canada 12,000 tons of uranium between 1963 and 1966?


George Harris Hees: My understanding of the letters of intent is to the effect that the British atomic energy authority have by their letter indicated that they are willing to accept that quantity of uranium.


Hazen Robert Argue: I wish to ask a supplementary question. Will the minister say whether it can be taken by the house that Canada is insisting that this quantity be purchased, or whether the Canadian government is prepared to allow Britain to purchase a smaller quantity?


George Harris Hees: When I talked last with the British high commissioner, I made it clear to him that Canada expected the United Kingdom government to take the 12,000 tons originally described in the letter of intent. He explained at quite some length the difficulties faced by the British atomic energy authority, in that their need for uranium is not anywhere nearly as great now as it was when the letter of intent was orignally entered into. At that meeting I told him that we should be glad to discuss this whole matter and that, on the understanding that it is vital to the uranium industry of Canada that the 12,000 tons of uranium be received and 90205-6-215J
Inquiries of the Ministry paid for by the British atomic energy authority, discussions could take place regarding perhaps an alteration in price which would be fair to the Canadian uranium industry, and which would also to some extent relieve the burden upon the British atomic energy authority and thereby the British government.
I told him that we are willing at all times to discuss matters in which we are mutually concerned and that Mr. Gilchrist, the president of Eldorado Mining and Refining Company, would be glad to have talks with the head of the British atomic energy authority with regard to this matter. I also told him that, at the end of these talks, Mr. Gilchrist would report to me as to how the discussions worked out, and that I would report to the cabinet for their consideration of any changes that were suggested.


Lester Bowles Pearson: May I ask the minister if he will inform the house why this firm contract for 12,000 tons of uranium was not included in the stretch-out arrangements of 1959?


George Harris Hees: The Leader of the Opposition seems a little bit difficult to explain things to this afternoon. The Prime Minister explained this matter to him yesterday and I explained it again this afternoon. Yesterday the Prime Minister pointed out very clearly that no formal contract has yet been signed, that what exists at the present time are letters of intent between the two entities, and that until a formal contract is signed no formal contract exists. However, these letters of intent are, as I say, an undertaking by both entities to carry out certain undertakings.


Hazen Robert Argue: I wish to ask a supplementary question. From the minister's statement are we to take it that the price is flexible and the quantity certain, or are both elements firm?


George Harris Hees: It seems equally difficult to explain things to the hon. member for Assiniboia this afternoon. I stated a short time ago that I had pointed out very clearly to the British high commissioner that Canada considered the quantity of 12,000 tons of uranium vitally important to the continuation of our uranium industry here, and that I did not feel any change in that quantity could be contemplated by the Canadian government. This being well understood, I also pointed out that there might be a possibility of some alteration in the price providing it would be a fair price to the Canadian uranium industry, and would be of assistance in lessening the burden which, the high commissioner explained, is falling heavily on the British atomic energy authority and, consequently, on the United Kingdom government. This

Inquiries of the Ministry burden has been brought about because their need for uranium has been greatly reduced compared to what it was when the letters of intent were originally entered upon.


Mr. G. J. Mcllraith (Ottawa West):: I should like to address a question to the Minister of Trade and Commerce, but before I do I should like to remind him of an answer he gave in this house on March 6, as reported on page 2672 of Hansard. He said then, in effect, that he had received no inquiries either from the United Kingdom government or from the United Kingdom atomic energy authority concerning possible cancellation or renegotiation of a firm contract involving 24 million pounds of uranium. The hon. gentleman answered in a dogmatic manner on that occasion that he had received no such inquiries. Can the minister tell us now whether since that date he has received any inquiries or requests for the renegotiation of this contract?


George Harris Hees: Again may I comment that it seems hard to explain things to certain hon. members this afternoon. If the hon. member for Ottawa West would think back he would recall that only a short time ago I explained I had held two lengthy talks since March 6, with the British high commissioner, who has spoken to me about this important matter. I think that answers the hon. member.


George James McIlraith: Perhaps we might have some further clarification of this situation. How did it happen that on March 6 the minister did not know that this contract was under renegotiation?


George Harris Hees: I said on March 6 that I had received no representations from the British government or from the United Kingdom atomic energy authority.


Mr. Crestohl:: Mr. Speaker, may I ask-


Mr. Speaker:: I think this matter has been pursued at more than the usual length both yesterday and today. If it is to be clarified further, a debate will be necessary.


Leon David Crestohl: I wonder if Your Honour would permit me to put another question to the Minister of Trade and Commerce along these lines. Can the minister state who it was initiated the conversations with the British high commissioner which he described in his reply? Was it he who initiated them or the high commissioner?


Mr. Speaker:: Order. I think the hon. member's question directed to a detail of that kind amounts rather to a cross-examination such as he might employ in an extended crossexamination in court, and that it is not a proper supplementary question at this stage.



BEAUCE COUNTY, QUE.    REQUEST FOR FURTHER STATEMENT ON ASSISTANCE BY ARMY

[Stage Direction]
On the orders of the day:
['Mr. Speaker, the Canadian embassy in Havana has been in close touch with the case of Patrick William Garrard since this Canadian citizen was detained by Cuban police when leaving Havana on March 23.\nAt this time the Canadian vice consul visited Garrard in detention and found him well and in good spirits. Garrard had not been interrogated and was not able to ascertain the charges against him. The vice consul visited him again on March 24, and the embassy has since made a direct approach to the Cuban foreign ministry for an explanation of the reasons for arrest. The outcome of', "Inquiries of the Ministry these representations is not yet known, but we are doing everything possible to protect Garrard's interests."]
Herbert Wilfred Herridge: Mr. Speaker, I wish to address a question to the Associate Minister of National Defence. It is a rather slippery one. In view of the fact that the Associate Minister of National Defence reported to the house on March 9, 1960 that an army report recommended the use of explosives to weaken the ice on the Chau-diere river two or three weeks before the anticipated break-up, would the minister explain why, as he stated in the house on March 24 of this year, the army has been sent to Beauceville once again at the last minute when flood conditions are already serious there?


Hon. Pierre Sevigny (Associate Minister of National Defence):: In reply to this question I may say that the army was sent to Beauceville immediately upon receipt of a request from the provincial authorities in view of the serious condition which was threatening the security of the citizens of that area.


Herbert Wilfred Herridge: I wish to ask the the minister a supplementary question. In view of the fact that this condition occurs repeatedly and there is some danger to the troops when the ice gets into a certain condition, would it not be sensible for the Department of National Defence to conduct negotiations with the provincial authorities to arrange to meet this difficulty at less expense and with more safety to the persons concerned?


Joseph Pierre Albert Sévigny: These flood conditions have prevailed on the Chaudiere river for a good many years. Each year the circumstances are quite different, and it is rather difficult for the army to negotiate with the provincial authorities concerning events which cannot be forecast.



[Stage Direction]
On the orders of the day:
Leon David Crestohl: May I address a question to the Secretary of State for External Affairs. Can the minister inform the house whether there were consultations between the United States government and the Canadian government prior to the recent conversations between President Kennedy and Mr. Gromyko concerning Laos, and whether the proposed continuation of participation by Canada in the truce forces was the result of such conversations?


Howard Charles Green: No, Mr. Speaker. There have been continuous consultations between Canada and the various other countries concerning Laos. This particular conversation between President Kennedy and Mr. Gromyko had nothing to do with the position Canada has taken.


[Stage Direction]
On the orders of the day:
Mr. Walter Pitman (Peterborough):: I wish to direct a question to the Secretary of State for External Affairs. Would the hon. gentleman comment on the report that Canada is rumoured to be pushing for longer term programs of aid to undeveloped countries at the development assistance group conference in London and, if possible, give any information he might have to the house?


Howard Charles Green: The Canadian delegation, which is composed of senior officials, is not taking any particular initiative such as the hon. member suggests in his question. It is expected that certain proposals will be put before the meeting, mainly by the United States delegation, for examination and subsequent study by the various members concerned. The Canadian delegation will, of course, be reporting fully to the Canadian government upon its return.
The present meeting is the fourth meeting of the development assistance group which is made up of Canada, the United States, the United Kingdom, France, West Germany, the Netherlands, Italy, Portugal and Japan. When the organization for economic co-operation and development comes into being, the development assistance group will be absorbed into the larger organization and will become a subcommittee on aid questions. I am afraid that the statement the hon. gentleman referred to is speculative and not based on facts.


Lester Bowles Pearson: May I ask the minister who is the head of the Canadian delegation to this important meeting?


Howard Charles Green: The head of the delegation is Mr. A. F. W. Plumptre of the Department of Finance, and the senior official from the Department of External Affairs is Mr. A. E. Ritchie.


[Stage Direction]
On the orders of the day:
Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, yesterday the hon. member for Assiniboia asked whether Canada has made any representations to the United Kingdom or the United States about
Inquiries of the Ministry the latest proposals made by the United Kingdom to the Soviet co-chairman. In reply to his question I wish to inform the house that during recent months the government has been in constant touch with the United Kingdom and the United States and with other governments about developments in Laos, and the possible role the truce supervisory commission might play in a solution of the crisis in that country. In these continuing discussions Canada has recognized that the situation is serious and that action is required by the countries principally concerned as well as the Laotians themselves to contribute to a peaceful solution.
As to the possible use of the international commission, we have taken the position that there should be general agreement among the parties concerned about the part the commission might play in contributing to a negotiated settlement. The proposals put to the Russians were a result of a long series of consultations and were made in the light of the existing circumstances. The views that Canada has from time to time expressed about the role of the Laos commission were taken into account in the proposals that were placed before the Soviet co-chairman by the United Kingdom government last week.


[Stage Direction]
On the orders of the day:
Walter George Pitman: Mr. Speaker I would like to ask a question of the Secretary of State for External Affairs. Would the minister indicate whether any move has been made by the Canadian government on behalf of Patrick William Garrard of Vancouver, who was arrested in Cuba and detained in jail? I have heard no further report regarding that situation, and would like to know whether the Canadian embassy has taken any action on his behalf.


Howard Charles Green: Mr. Speaker, the Canadian embassy in Havana has been in close touch with the case of Patrick William Garrard since this Canadian citizen was detained by Cuban police when leaving Havana on March 23.
At this time the Canadian vice consul visited Garrard in detention and found him well and in good spirits. Garrard had not been interrogated and was not able to ascertain the charges against him. The vice consul visited him again on March 24, and the embassy has since made a direct approach to the Cuban foreign ministry for an explanation of the reasons for arrest. The outcome of

Inquiries of the Ministry these representations is not yet known, but we are doing everything possible to protect Garrard's interests.



THE MINISTRY


[Stage Direction]
On the orders of the day:
Mr. Erhari Regier (Burnaby-Coquitlam):: should like to direct a question to the Prime Minister. In the light of the increasing crusade being waged by the Minister of National Defence on behalf of the extension of the nuclear club, can we expect that the commendable effort by the Secretary of State for External Affairs in connection with this matter will be crowned with success at an early date by the appointment of a new minister of national defence?


Mr. Speaker:: Order. The gentleman's question is a rather argumentative one and asks for the announcement of an appointment by the government. Such announcements, in my experience, have always been made on the government's own initiative and not in answer to questions from the floor.



INDIAN AFFAIRS

[Stage Direction]
RESOLUTIONS REQUESTING BRINGING INTO FORCE OF SECTION 96a OF ACT
On the orders of the day:
Mr. Frank Howard (Skeena):: I wonder whether in the absence of the Minister of Citizenship and Immigration I may direct a question to the parliamentary secretary, of which I hope sufficient notice has been given.
Can the parliamentary secretary inform the house whether any reply has been received from the attorney general of British Columbia with respect to the resolutions from the Tsitsk, Bella Coola, Kincolith, Metlakatla, Canyon City and Gitlakdamix Indian bands requesting that section 96A(2) of the Indian Act be brought into force, which resolutions were forwarded to the attorney general? If so, could he also give an indication as to the contents of the reply?


Mr. John Charlton (Parliamentary Secretary to the Minister of Citizenship and Immigration):: I wish to thank the hon. member for Skeena for having given me notice of his intention to ask this question. The reply to the first part of the question is yes; a reply has been received from the attorney general of the province of British Columbia. As far as the second part of the question is concerned the contents of the letter are being studied. I am not in a position to make any comment at the present time.

(Translation):



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Lionel Chevrier: Mr. Speaker, I should like to ask the Minister of Transport whether he could give us any information concerning the matter of the Sky-Caps porters at Dorval airport about which he was supposed to make inquiries some time ago.


Hon. Leon Balcer (Minister of Transport):: Mr. Speaker, the situation remains unchanged for the time being and is still being looked into.


Lionel Chevrier: The minister was also supposed to tell the house whether the order in council passed by his department constitutes an infringement upon provincial rights, that is to say, civil rights.
The minister made that statement in reply to a question of mine on February 3. Over a month has elapsed since then. Is the minister in a position to tell us whether he has made inquiries?


Léon Balcer: Mr. Speaker, there is no infringement upon the civil rights of the provinces, and I advise my hon. friend that the order in council in question has not actually been carried into effect in the present case. We are still looking into the situation before reaching a final decision.



GRAND'MERE


[Stage Direction]
On the orders of the day:
Mr. M. J. A. Lambert (Parliamentary Secretary to the Minister of National Revenue):: Mr. Speaker, in reply to the question put by the hon. member for St. Maurice-Lafleche on March 16 regarding Grand'Mere Knitting Mills and Grand'Mere Handicraft, I might say that those companies have not applied to the Minister of National Revenue for assistance. Neither did the minister himself ask that special measures be taken in favour of those companies. Any steps taken are intended for the textile industry in general.
(Text):



FORD MOTOR COMPANY


[Stage Direction]
On the orders of the day:
Hazen Robert Argue: Mr. Speaker, on Thursday last the hon, member for Trinity directed a question to the Minister of Labour based on a communication received by the Minister of Finance, a copy of which was sent to the Minister of Labour. I would like

to ask the Minister of Finance, having received the communication from the president of local 200 of the united automobile workers drawing his attention to the lay-offs by the Ford Motor Company of qualified machine repairmen while at the same time large machines from the plant have been sent to the United States for repairs, could the minister use his good offices to ask that this situation be rectified?


Donald Methuen Fleming: Mr. Speaker, I received a letter containing such allegations and asking if I would communicate with the company. In my reply I pointed out that matters pertaining to the export of machinery for the purpose of repair, reconstruction or other such purposes with the intention of reimporting them into Canada are not matters falling under the jurisdiction of the Department of Finance but under the jurisdiction of the Department of National Revenue. I accordingly referred the letter to my colleague the Minister of National Revenue.


Hazen Robert Argue: In the absence of the Minister of National Revenue could the Minister of Finance inform us what follow-up has been made, or representations, to the company?


Donald Methuen Fleming: I think it is a little premature in this regard, as I received the letter only yesterday.


Hazen Robert Argue: No; this letter was received last Thursday.


Donald Methuen Fleming: I was in Victoria last Thursday, Friday, Saturday and Sunday.



PROPOSED LIMITATION OF PRODUCTION OF NARCOTICS

[Stage Direction]
On the orders of the day:
Mr. W. H. McMillan (Welland):: I should like to ask the Minister of National Health and Welfare a question in connection with the international convention to control the distribution of addiction-producing narcotics. Would the minister comment on the chance of limiting the production of these narcotics to the quantities necessary to meet medical and scientific needs?


Hon. J. W. Monleilh (Minister of National Health and Welfare):: I thank the hon. member for having given me notice of this question. I would hope there is every chance of limiting the production of narcotics to the fields specified by the convention adopted at the United Nations on Friday, since this, of course, was the purpose of calling together the many countries involved. The force of the convention will depend on the sincerity of the
Inquiries of the Ministry signing countries in imposing controls within their own national boundaries.
I am glad the hon. member has given me an opportunity to recognize the valuable contribution made toward the production of the convention by Mr. R. E. Curran of my department, who headed the Canadian delegation and acted as chairman of the drafting committee.



PUBLICATIONS

[Stage Direction]
STATEMENT ON SALE OF ELLIOT LAKE "standard"
On the orders of the day:
George Harris Hees: Mr. Speaker, the hon. member for Kootenay West asked a question yesterday regarding the sale of the Elliot Lake Standard.
I am advised that the first negotiations by the Thomson interests to purchase this paper were entered into three years ago, and obviously therefore bear no relationship to the present situation.



AIR TRANSPORT


[Stage Direction]
On the orders of the day:
Léon Balcer: Mr. Speaker, yesterday the hon. member for Port Arthur inquired regarding a press report in respect of major overhaul work carried out by Canadian Pacific Air Lines in foreign countries. I understand that Canadian Pacific Air Lines has had some of its overhaul work carried out in Great Britain. Canadian Pacific Air Lines is a privately owned company which must operate in direct competition on its international routes with the international carriers of other countries. I know that, as a Canadian based company, it maintains extensive maintenance facilities in Vancouver. However, since this is a private matter of this company I am not in a position to comment any further.



INQUIRY AS TO ACTIVITIES OF RETURNING OFFICERS

[Stage Direction]
On the orders of the day:
Erhart Regier: Mr. Speaker, I would like to ask a question of the Secretary of State. Would the minister explain why returning officers have been asked to designate district boundaries and to enlist enumerators when it is known that a redistribution of ridings will be required by law for the 1962 session of this house?


Hon. Noel Dorion (Secretary of State):: will take the question as notice.

Supply-Fisheries IMMIGRATION



REPORTED REMARKS BY DEPUTY MINISTER

[Stage Direction]
On the orders of the day:
John Alpheus Charlton: Mr. Speaker, the hon. member for Peterborough asked a question yesterday with reference to a speech made by the deputy minister of the Department of Citizenship and Immigration in Toronto last Saturday.
Dr. Davidson has advised me that in what he said about malicious libel on the reputation of Canada he was referring not to reports of economic conditions in Canada, but rather to reports of the alleged hardships suffered by certain immigrants who have returned to Europe from Canada. The hon. member might refer, in this connection, to a recent series of articles appearing in the British newspaper The People, beginning February 19 and running through to March 19. He might also refer to Stanley Westall's article in the Globe and Mail last Thursday, entitled "The Image of Canada-a Bad Press in Britain". I shall be glad to make the clippings available to him if he so desires.



IRENE REBRIN


[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: Mr. Speaker, I would like to address a question to the parliamentary secretary to the Minister of Citizenship and Immigration. Would the parliamentary secretary assure the house that the usual practice will be followed, as in similar circumstances, and that Miss Irene Rebrin will be permitted to remain in Canada until the conclusion of a civil action in which she is interested?


Hon. E. D. Fulton (Acting Minister of Citizenship and Immigration):: Perhaps I
might deal with that question, Mr. Speaker, in the absence of the minister. I can assure the hon. gentleman that every consideration will be given to the proposition he has put forward.

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


The Chairman:: We are considering supplementary estimates, item No. 687.



DEPARTMENT OF FISHERIES

[Stage Direction]
688. Payment, subject to such terms and conditions as the governor in council prescribes, of assistance to producers of salted fish on products designated by the governor in council, in the amount of 50 per cent of the laid down cost of salt purchased for their production-further amount required, $155,105.
Mr. Carter:: May I ask the minister if he has a breakdown of this amount by provinces?


Donald Methuen Fleming: The hon. member will appreciate that this is an estimate of what will be required for this purpose. The provision of information as to any possible breakdown of payments among provinces will not become possible until the payments have actually been made. Of course the estimate itself does not attempt a precise breakdown on this basis.


[Stage Direction]
Item agreed to.
690.	Contribution towards the costs of a special meeting of the food and agriculture organization of the United Nations regarding distribution and use of fish meal, $2,500.
Erhart Regier: On this item I should like to lodge a complaint with the minister, with the Department of Fisheries and with the government as a whole. In recent years we have received notice of a developing practice, especially on the part of fishing companies located in British Columbia, under which, in the production of herring fish meal, they are moving into other countries and using their capital resources, taking advantage of lower labour costs, especially in such countries as Peru, to develop large herring fishing industries. This has the result of undercutting and eliminating the Canadian production of fish meal, and consequently our herring fishermen have had to suffer long months of unemployment. They have now been re-employed at reduced rates. Their income has been reduced because of the activities of Canadian corporations which are establishing herring fishing enterprises in other countries.
These corporations are using Canadian resources to do this. They are using the profits they made in Canada in the Latin American and South American countries, with the result -I will not say with the purpose-that many Canadians interested in herring fishing, and who have invested their whole life savings in gear and equipment, are either unemployed or have their income reduced. If we are to engage in international aid in regard to the distribution of fish meal, I feel that Canadian fish meal should be distributed to those nations in the world that have need of it. Consequently every consideration ought to be given to the Canadian production of fish meal, and we should not be voting money here that will help to distribute to the needy nations of the world the fish meal that has been produced by Canadian corporations in countries other than Canada. If we are to give aid in this respect we ought to ensure that Canadian fishermen get the benefit, and that we are not

actually aiding Canadian corporations in their profit-making schemes in other countries of the world.


[Stage Direction]
Item agreed to.
Governor general and lieutenant governors-
691.	Office of the secretary to the governor general-further amount required, $8,500.
Herbert Wilfred Herridge: I want to ask one question of the minister, who I know has a great regard for constitutional rectitude. Would the minister consider it proper for a lieutenant governor of a province, who it the representative of Her Majesty, to be appointed a director of a crown corporation and be subject to the criticism of members of parliament?


Donald Methuen Fleming: Mr. Chairman, I am not in the habit of expressing opinions on speculative or hypothetical questions. If the hon. member will direct my attention to something specific under the proper circumstances I will do my best to give him an opinion, but I warn him that I am still in good standing as a barrister and solicitor in the province of Ontario, and if this question involves rendering a legal opinion I will expect him to see that the labourer is regarded as worthy of his hire.


[Stage Direction]
Item agreed to.

[Stage Direction]
692.	Departmental administration, to extend the purposes of vote 151 of the main estimates, 1960-61, to include a grant of $5,000 to the Canadian corrections association to assist in defraying the costs of a congress of corrections to be held in Toronto in 1961, $5,000.
(Translation):
Mr. Roberge:: Mr. Chairman, I should like to put a question to the Minister of Finance (Mr. Fleming) concerning this item. The provision relates to a grant to the Canadian corrections association to assist in defraying the costs of a congress of corrections to be held in Toronto in 1961. Can the minister give us further details about this congress? Will it be sponsored by the Department of Justice or by a professional association?
(Text):


Donald Methuen Fleming: The Canadian corrections association is sponsoring a congress of corrections to be held in Toronto from May 14 to May 19 next. It is expected there will be close to 1,000 persons in attendance from all parts of Canada. Those are persons engaged in correctional work, such as judges, magistrates, crown attorneys, defence counsel, wardens and other officers of penal institutions, probation and parole officers and social workers in the field of after care. It is also expected there will be in attendance 90205-6-216
Supply-Justice
certain well known authorities in the correctional field coming from the United Kingdom, the United States and Belgium, as well as representatives from the Department of Justice.


Mr. Hellyer:: Can the minister say whether there is any special reason why this convention is being held in Toronto other than the beauty of the city, the friendliness of the people and the unsurpassed convention facilities which exist there?


Donald Methuen Fleming: I think the hon. member will agree with me that no further reason is required.


Paul Theodore Hellyer: I thank the minister.


[Stage Direction]
Item agreed to.
Northwest Territories-
694. Administration of justice in the Northwest Territories including the Northwest Territories territorial court-further amount required, $48,500.
Gabriel Roberge: I have noted that the item in the main estimates provides for $45,000. The government is now asking for an additional $44,000 in these supplementary estimates. Can the minister indicate why such a tremendous increase is required?


Donald Methuen Fleming: This vote of $48,500 is composed of two elements; the first, $44,000; the second, $4,500. The item of $44,000 covers fees paid to crown counsel and defence counsel appointed by the court in the Northwest Territories as well as fees, living expenses and transportation of jurors, witnesses, interpreters and others in connection with the proceedings in criminal matters and the conduct of coroners' inquests. From this allotment are also paid the expenditures made by the Royal Canadian Mounted Police for the maintenance of prisoners, including the hiring of matrons for female prisoners while jailed in Royal Canadian Mounted Police guard rooms and during transportation to provincial jails.
I may say that in addition to the current expenses I have mentioned there has been received by the Department of Justice a bill in the amount of $21,687 from the government of the Northwest Territories, covering payments made by that government to the province of Manitoba with respect to the housing of juvenile delinquents from the Northwest Territories. This is a cumulative amount covering such service between April 1, 1953 and June 30, 1960. That explains why the item is concentrated at this particular time but this portion covers, as the hon. member will see, some seven and a quarter years.


[Stage Direction]
Item agreed to.
[Stage Direction]
Supply-Justice Combines Investigation Act-
696. Restrictive trade practices commission-further amount required, $17,500.
Leon David Crestohl: Can the minister give the committee some details as to what industries are being investigated, necessitating this additional expenditure? In the details on page 20 there is simply a general statement referring to fees and expenses of reporters, witnesses and so on, and also travelling expenses, with no indication in what field of investigation this money was expended. I think the statement of details would have been more informative and more complete if it had included information as to the particular trades or practices being investigated.


Donald Methuen Fleming: I think the hon. member is aware that it is not the practice to announce the particular areas of Canadian business or industry in which investigations are being carried on until a report has actually been made and published.


Chesley William Carter: Mr. Chairman, I should like to repeat a question I asked the Minister of Justice on March 7 and I quote now from page 1798 of Hansard:
I should like to direct a question to the Acting Minister of Justice. In view of the fines levied on eight electrical companies in the United States for bid rigging and price fixing, will the minister tell the house whether any investigation is being made or is contemplated by the combines investigation branch into similar practices by the Canadian counterparts of these electrical companies?
The Solicitor General, who was the acting minister of justice at that time, said:
I will take this question as notice and give the member an answer at an early date.
If the answer has been given I have missed it. I wonder whether the minister can throw any light on this question.


Mr. Benidickson:: Mr. Chairman, I do not imagine that the Minister of Finance could be expected to reply to that question, but I rise with a similar purpose in mind. On March 13 I asked a question in similar vein with respect to combines administration. My question referred to two articles that had appeared in the Toronto Globe and Mail under the by-line of Mr. Bruce Macdonald in which it was alleged that since the passing of legislation last session electrical goods were no longer available except at prices 25 per cent to 40 per cent higher than had been normal prior to last year's legislation coming into effect. At that time the parliamentary secretary replied to my question in these words, as found on page 2914 of Hansard:
Mr. Speaker, I am sure the officials are on the job in this respect, but I shall be glad to refer the matter to the appropriate officials for comment.

I have been very intrigued this afternoon to note the lack of co-operation that the Minister of Finance is experiencing so far as his colleagues are concerned when he is called upon to deal with problems of this nature in this important committee of supply. We have only been in committee for about 20 minutes. I saw the Minister of Justice conveniently retire, but I thought fortunately we still had his parliamentary secretary here. However, as we approached closer to the items under the heading "Justice", by coincidence or otherwise the parliamentary secretary retired. Then I thought that we were still all right because the Solicitor General, who has acted as minister of justice, was with us and perhaps we would be able to get some information from him on these matters about which we could not expect the Minister of Finance to have complete details. However, as we were getting closer and closer to the items under the heading "Justice", off went the Solicitor General.


Lionel Chevrier: He cleared out, too.


Donald Methuen Fleming: Mr. Chairman, any connection between the particular items now engaging the attention of the committee and the movement of my colleagues and the hon. members to whom reference has been made is, I am quite certain, purely coincidental. The long-time practice of the house has been that the final supplementaries coming at the close of the fiscal year are handled by the Minister of Finance as best he can. I may say that I do not find the lack of co-operation on the part of my colleagues that the hon. member for Kenora-Rainy River professes to find.
So far as the question of the hon. member for Burin-Burgeo is concerned, I shall be glad to draw his inquiry to the attention of my colleague.


Paul Theodore Hellyer: Can the minister tell us the number of prosecutions under this legislation in the fiscal year just ending compared with the number in the previous fiscal year and also whether the change, if any, is responsible for the increased expenditure?


William Moore Benidickson: I am delighted to see that the parliamentary secretary to the Minister of Justice was only behind the curtain and is now back in his seat. I refer to him the question I posed as long ago as March 13 last. It related to allegations that under the new combines legislation passed last session electrical consumer goods are no longer available generally throughout the country except at prices 25 per cent to 40 per cent higher than those prevailing prior to the new legislation. In my view this confirmed the warning of

the opposition last year when the legislation was introduced. We asserted then that such legislation was likely to have a very adverse effect upon consumers. We pointed in the strongest possible terms the danger of price fixing, particularly if jurisdiction over price fixing was to be removed from the Department of Justice and, as is usually the case under Conservative administrations, transferred to the hands of powerful manufacturers such as Canadian General Electric and others who are referred to in the articles by Mr. Bruce Macdonald in the Globe and Mail.


Mr. Bell (Saint John-Alberl):: Mr. Chairman, I should like to say for the record that there is no evidence whatsoever that the consumer has been harmed in any way by the legislation enacted last year. In fact I think the contrary is the case. I am not sure whether the hon. member wants a specific answer at this time to the question he posed.


William Moore Benidickson: The parliamentary secretary will recall that he assured me that after consulting the officials he would furnish some information to the house. These articles received considerable prominence, and my recollection is that they asserted facts in a most positive way. They referred to companies, they referred to products, and they referred to very distinct changes in consumer prices in the range I have already mentioned and which I referred to in my question of March 13 to which no reply has yet been made.


Thomas Miller Bell: The question asked by the hon. member for Kenora-Rainy River on March 13 was as follows:
Would the parliamentary secretary inquire and inform the house whether officials have examined the first retail pricing guide issued by the Canadian General Electric Company Limited after the government's amendments to the Combines Investigation Act last session to ascertain whether consumer electrical goods, in consequence, are no longer available except at prices 25 per cent to 40 per cent higher than formerly?
If an examination has taken place, is the minister satisfied that because of the amendments of last session there is no offence against the remaining provisions of the act respecting resale price maintenance?
In reply to this question I may say the matter has been brought to the attention of the director and is presently being examined to determine whether an inquiry is warranted. Of course, as the hon. member knows, the general practice is not to give out information on whether or not an inquiry is proceeding unless and until a report is published.


Erhart Regier: Mr. Chairman, I agree that the government needs this additional amount. I believe a useful purpose is served in exposing the activities of Canadian or other corporations in so far as price fixing is concerned. However, in a certain way we are simply pouring 90205-6-216J
Supply-Justice
money down the drain. Almost every major industry in Canada has been found guilty of violating the Combines Investigation Act, yet no beneficial results have flowed to the Canadian consumer except the publicity given to these matters. I feel the time is rapidly approaching when the Canadian government should reconsider its position in connection with this subject.
I remember very well indeed, Mr. Chairman, when our present Prime Minister was a member of the opposition. At that time he demanded of the government of the day that the Combines Investigation Act be amended in order to put some teeth into it. It was his contention then that anyone who was found guilty of violating the Combines Investigation Act, no matter how high ranking an officer he might be, should have imposed on him a mandatory term behind bars. He ought to have to go to jail, because the mere levying of a fine is ineffective and even ludicrous. If the Prime Minister meant what he said a few weeks ago, that the issue in the next election is going to be free enterprise versus socialism, I believe his election appeal is going to meet with very little response unless he is able to show that his government really believes in free enterprise.
We have had all these investigations in the past, and almost without exception Canadian enterprise has been found guilty of plotting and scheming in an unethical way, in an illegal way, to rob the consumers. Even the Minister of Finance, I believe it was in his budget address in 1959, admitted to this house the concern of the government over the growing power of corporations to determine prices regardless of the normal laws of supply and demand. If the election issue is going to be free enterprise versus socialism, the government will have to convince the Canadian people that there is some free enterprise.
I happened to be in the United States at the time the officials of the electrical industry were convicted of combining. I can assure the minister that after these officials were sentenced to jail the people of the United States found a renewed faith in the fundamentals of free enterprise. We have seen nothing of the kind happen in Canada. I think we ought to take the Prime Minister's advice when, as an opposition member, he advocated that if our Canadian people are to be expected to believe in the existence of free enterprise, if they are not to become cynical, then we will have to prove by the implementation of the Combines Investigation Act that we mean what we say. After all, Mr. Chairman, I do not see why a man who steals a bit of wire from the B.C. Electric should be sentenced to two years in the penitentiary, while a man

Supply-Justice
who is a member of the baking industry combine and who needlessly adds one cent per loaf to the cost of every loaf of bread the Canadian housewife buys, should only be fined. In my opinion the baker is a bigger criminal than the man who steals a bit of wire from his employer.
I would urge upon the government that they look at the attitude and the thinking of the government across the border in connection with this issue, and recall how quickly the confidence of the people of the United States was restored in the institution of government. In contrast, our government merely carries on year after year by levying fines upon those who have been found guilty. This means nothing to these people. As a matter of fact they very often increase their rate of violation immediately after the results of an inquiry have been released.
If the minister is really concerned about the growing power of Canadian corporations to determine price levels regardless of the normal law of supply and demand, I recommend that before we vote much more money to the combines investigation branch we consider amending this act so that it will have some effect on the Canadian economy and on the faith the Canadian people are supposed to have in our method of doing business, as well as upon the respect our people are supposed to have for law and order in this country.


Paul Theodore Hellyer: Mr. Chairman, we should hear something from the minister on this subject. The parliamentary secretary to the Minister of Justice told us a few minutes ago there was no evidence that prices had been increased since the change was made in the legislation last year. Obviously the parliamentary secretary has not been shopping recently or he would know from his own experience that prices for many lines of hard goods have increased. The Minister of Finance should be interested in this matter, because the Minister of Finance is interested in the total amount of business done in this country and in the total number of jobs available to Canadian workers.
The Minister of Finance is well aware of the fact that there is an elastic demand for many of these hard goods. The lower the price is, the greater the market, and the greater the market the more jobs there are for the people who manufacture these goods. Part of the trouble with our economy at the present time is this matter of the rigidities which are being built into it. One of these rigidities is fixed prices. I think the minister should look into the effects of the changes in the legislation which were enacted by parliament last year to determine the extent to which they have caused prices to be increased, as well as the effect this has had on markets

and consequently upon employment in Canada. I think he should do this not only for his own sake but because he has a responsibility to this House of Commons and to the Canadian people because of his high office.


William Moore Benidickson: The productivity council should look at it also.


Jacques Flynn: Shall item 696 carry?


Erhart Regier: No. I should not like this opportunity to go by without making this comment. When I referred to the budget contribution of the Minister of Finance in 1959 I noted that he, by shaking his head, attempted to deny that he had indicated as I mentioned. I should like to read to the minister what he had to say as reported at page 2408 of Hansard of April 9, 1959 when, among other things, he said this:
Advancing technology might have been expected to reduce the cost and selling price of many products to consumers. It is evident, however, that developments in corporation pricing policies, in labour organization and even in our political democracy are producing increased rigidities which inhibit the free play of competitive forces and thereby promote inflation and price increases.
All I am asking at this time is what are the intentions of the government with regard to this concern so aptly and ably expressed by the minister on April 9, 1959, other than a mere pouring of more money into more investigations that will find even more Canadian corporations guilty, but will have no effect in reality except to build up an attitude of despair and cynicism on the part of Canadian consumers.


Donald Methuen Fleming: Mr. Chairman, I am obliged to the hon. member for reading exactly what I did say in the budget speech of 1959 and in that way exposing his earlier misinterpretation of what I said in this regard. Hon. members are now in a position to contrast what I actually did say with the interpretation put upon it by the hon. member in his earlier remarks.
May I remind you, Mr. Chairman, that item 696 is for a further amount required in addition to a sum already voted by parliament and to be found in the Appropriation Act passed earlier in the session of 1960. In this situation, as I understand it, the rule that applies is that we are not debating the principle of the main item but are simply endeavouring to decide whether the additional amount now proposed is in fact required.
I may say that this additional amount is in fact required. It is required owing to an unforeseen increase in reporting costs and other fees and expenses in unusually prolonged inquiries, and to cover the cost of travelling to hearings at points outside of Ottawa. These are additional expenses necessarily incurred

in the effective enforcement of our combines legislation. I would have thought that the hon. member for Burnaby-Coquitlam would warmly applaud these demonstrated efforts at effective enforcement of the legislation enacted by parliament in this regard.


Paul Theodore Hellyer: I want to say just one word. Surely we are in order in discussing here the government's schizophrenic approach to the matter of combines. On the one hand it spends more money on prolonged investigations, and on the other hand it introduces legislation which is responsible for more prolonged investigations owing to the fact that it enables companies to have broader scope in the fixing of prices within the law. For this reason we are perfectly justified in questioning further expenditures which might not have been necessary if the government had not taken an altogether different position in the legislation it placed before this House of Commons last year.


Jacques Flynn: Shall vote 696 carry?


Erhart Regier: No, Mr. Chairman. The minister made an attempt to indicate that we might even be out of order. No one here attempted to debate the principle of the Combines Investigation Act. We only ask the government, before we vote the additional amount for the implementation of this act, what its intentions are in this regard.
I listened carefully to the hon. member for Trinity when he spoke previously, and he also complained about the rigidity in our price structure. I indicated the minister's complaint on April 9, 1959 about the rigidity in our price structure. All I am asking of the minister is that he indicate what intentions the government has in this regard. Is this money now being asked for going to help to eliminate or to elasticize the rigidity that now exists by restoring a bit of old fashioned, honest, free enterprise into our economy?


[Stage Direction]
Item agreed to.
DEPARTMENT OF LABOUR Special services-
697. Special services branch including the promotion of a program for combating seasonal unemployment, the organization and use of workers for farming and related industries and assistance to the provinces under agreements entered into with the provinces by the Minister of Labour with the approval of the governor in council-further amount required, $65,000.
Lionel Chevrier: Mr. Chairman, this vote reads as follows:
Special services branch including the promotion of a program for combating seasonal unemployment-
And so on. I should like to say a word in connection with this matter. I believe it was
Supply-Labour
on March 21 last that the Minister of Labour indicated in the house, by way of an announcement, that some 105,000 jobs were created this year because of the winter works program.


Donald Methuen Fleming: Mr. Chairman, may I say that the minister was referring to the municipal incentive winter works program. This item does not refer to that matter. This item refers to expenditures in relation to publicity to encourage people all over the country to undertake the provision of employment in the winter. This item is not related to the government's own municipal incentive winter works program.


Lionel Chevrier: As I said earlier, Mr. Chairman, this item refers to the promotion of a program for combating seasonal unemployment. The implementation of winter work is for the benefit of seasonal unemployment. It is my intention to deal with seasonal unemployment under this heading. I hope the minister will allow me to continue, because I believe that the remarks which I intend to make, and which are going to be brief, are in conformity with the title of this item.
I was going on to say that, following the statement which the Minister of Labour made and which can be found at page 6823 of Hansard of July 23, 1960, reference was made to seasonal unemployment and the assistance that was being given to combat seasonal unemployment by the winter works program. The government has attempted to deal with the matter on every opportunity which has been given in the house. The government has taken full credit for the creation of new jobs during the season of unemployment. To the extent that any new jobs have resulted from works provided by the government to relieve seasonal unemployment, in my opinion and that of those of us who sit on this side of the house credit should go to the local authorities on whom the major financial burden of these projects has fallen.
On July 23 of last year the Minister of Labour stated that the average labour content of all municipal winter works is 34.5 per cent. As the committee knows, the federal government pays 50 per cent of the direct labour cost or approximately 17 per cent of the total cost. An additional 25 per cent to 40 per cent of the direct labour cost is borne by the province. In the case of the province of Quebec 40 per cent of those costs are being paid by that government, and were it not for what is being done by way of assistance with regard to seasonal unemployment in the province of Quebec, unemployment there would be much higher than it is. The point I am trying to make is that under this scheme

Supply-Labour
for combating seasonal unemployment the main burden falls upon the municipalities.
I have compiled here two tables which indicate that the winter works program is not as effective in its impact as the government would have us believe. Special table 3(c) breaks down the labour force estimates of employment by industry and by occupation, and I should like to table a compilation of figures derived from special table (c) entitled "Employed by Industry and Occupation" issued by the special surveys division of the dominion bureau of statistics. I should like to ask permission to table these two documents.


Mr. Chambers:: Did the hon. member for Essex East do any arithmetic in connection with those?


Lionel Chevrier: No, these are not from the hon. member for Essex East, though were he here I am sure he would approve of those two documents.


Jacques Flynn: Did the hon. gentleman say he wanted only to table these documents?


Lionel Chevrier: I should like to have them printed in Hansard in connection with the matter now under discussion.


Donald Methuen Fleming: I take it they are from government sources.


Lionel Chevrier: Yes, as I have indicated they are from special table 3(c), employed by industry and occupation, special surveys division, dominion bureau of statistics.


Jacques Flynn: These are two tables. Does the committee agree to have them printed at this point in the hon. member's remarks?


Some hon. Members:: Agreed.
[Editor's note: The tables above referred to follow:]



EMPLOYMENT IN CONSTRUCTION INDUSTRY

[Stage Direction]
Absolute
January	February	Change1958	331,000	333,000	+ 2,0001959	341,000	342,000	+ 1,0001960	340,000	331,000	- 9,0001961	317,000	307,000	-10,000
Source: Special table 3(c), Employed by industry and occupation, special surveys division, DBS.

[Stage Direction]
CONSTRUCTION	LABOURERS AND UNSKILLED WORKERS
January	February	Difference	January	February	Difference1958	273,000	269,000	- 4,000	271,000	272,000	+ 1,0001959	266,000	271,000	+ 5,000	298,000	297,000	- 1,0001960	267,000	267,000	0	294,000	289,000	- 5,0001961	253,000	260,000	+ 7,000	294,000	273,000	-21,000
Source: Special table 3(c), Employed by industry and occupation, special surveys division, DBS.
Lionel Chevrier: If hon. members would look at the first table entitled "Employment in Construction Industry" they would see there were 10,000 fewer jobs in construction in February of this year than there were in January, and 24,000 fewer than in February, 1960. Thus, the winter works program has not mitigated the seasonal decline in employment in the construction industry between January and February.
In so far as the other table is concerned *-the table entitled "Employment by Occupation"-as can be seen from the table which has just been filed there was a decline of
4.000	workers in 1958, but during the last three years there has not been a decline in the number of what are termed construction workers between January and February. During 1959 there was an increase of some
5.000	workers and this year there was an increase between January and February of some 7,000 workers.
However, the point I am trying to make, and which is borne out by this latter table, is that the winter works program has had

no discernable impact on the employment of labourers and unskilled workers. There were approximately 21,000 fewer jobs in this occupational category in February of this year than in January. We have, of course, asked the government on a number of occasions-the hon. member for Essex East and others, too-for a local breakdown of the projects undertaken during this year's winter works program. We have not as yet obtained the answer, so we have been unable to analyse the local impact of the projects.
There are a few explanations why the government can claim that there were 105,000 additional jobs created by the program and why there has still been no amelioration of the seasonal unemployment problem among construction and unskilled workers. These reasons are, first, that municipalities have undertaken during winter construction work which would normally be done in summer in the belief that the extra cost involved would be more than compensated for by the participation payments of the federal government. To the extent that this is true, no

new jobs have been created but, rather, unemployment in wintertime has been replaced by unemployment in the summertime. This has been brought to the attention of the government not only during discussions this year but also last year when an indication was given to the Minister of Labour that in so far as seasonal unemployment is concerned many of the municipalities which undertook works simply postponed the works from summer to winter, the effect of which was simply to postpone unemployment in wintertime to unemployment in summertime.
The other point I should like to make is that communities suffering from a -high incidence of seasonal unemployment have found themselves incapable of participating in the winter works program to any great extent because of the high level of cyclical unemployment they have experienced this year and the encumbent financial burden of increased welfare payments. Communities such as the city of Ottawa, for instance, where there is not a high level of unemployment, have been able to take advantage of winter works projects to a greater extent than communities which really need them. This, I think, is a factor which should be taken into consideration with regard to this whole matter of seasonal unemployment.
There are two suggestions I should like to make and then I shall resume my seat. They are a repetition-and I think they need to be repeated-of suggestions which have already been advanced by those of us who sit on this side of the chamber. They are, first, the establishment of a municipal loan fund, and, second, the incorporation in the winter works program of a formula on a sliding scale of federal participation depending on the amount of unemployment in a particular area. That would have the effect of insuring that the winter works program had its- greatest impact in distressed areas. As a deterrent to seasonal unemployment and as a project to assist employment we do not think that what has been advanced by the government meets the situation at all, and now I have reference particularly to the formula which was brought down by the Minister of Labour having to do with accelerated depreciation. It is our opinion that the two suggestions I have just made would meet the situation far better.


Donald Methuen Fleming: This item is one calling for the provision of a further amount of $65,000 to supplement the amount previously voted in the main estimates. It has nothing whatever to do with the municipal incentive winter works program. As I pointed out after the hon. member for Laurier had
Supply-Labour
launched into his remarks, this has to do with the effort made to encourage others than municipalities to undertake what measures may be open to them with a view to extending employment in the winter months. This is an offer that has been made by the Department of Labour, and with very encouraging results, to encourage people to do work in the winter and to undertake the job of creating work that can be done in winter months but is not always done then, for some reason or other.
This item is designed to provide the sums that have been expended for publicity in this regard, directed to bringing home to people their responsibilities in this respect, and the opportunities that do exist for the undertaking of work during the winter months. This lies completely outside the field of the municipal winter works incentive program. That is a matter that was undertaken, in so far as the estimates are concerned, under an item that was brought in with an earlier group of supplementary estimates. If we are going to have a debate on that I will be happy to participate in it but with respect, that lies completely outside the ambit of this present item.


William Moore Benidickson: In view of the remarks just made by the Minister of Finance, I take it that this involves some uncontemplated items of advertising and promotion that would have an ancillary effect with respect to the enlargement of the winter work. Perhaps it includes advertising such as I have here "Department of Labour-Do it Now with a Small Business Loan". Perhaps that is one of the items that was not contemplated when the main estimates were provided more than a year ago, and perhaps advertising of this kind would be provided for in the vote we have before us, is that so?


Donald Methuen Fleming: That particular advertisement may have been included in the scope of the main original estimate. I cannot say precisely whether it was included in the sums provided for in the supplementary estimates now under consideration, but the increase that is provided for here, in the appropriation for this total purpose, arises in part out of the fact that after the main estimates were introduced in the house for the fiscal year 1960-61, the chartered banks indicated their willingness, when this matter was discussed with them, to service home improvement loans. This type of loan was extended by Central Mortgage and Housing Corporation to include the owners of rental properties. The winter employment committee within the Department of Labour recommended that, in view of the need to give

Supply-Labour
support to the promotion directed to home and farm improvement loans the increased cost for the printed material over the last year and the needed expansion to keep pace with demand, the expenditure for winter employment publicity should be increased. That has been approved and this additional sum of $65,000 resulted.


William Moore Benidickson: I was not referring to advertising with respect to home improvement loans because, after all, that has been a form of providing employment which has been in existence over a long number of years.


Donald Methuen Fleming: With respect, I think the hon. member is not right about that. The home improvement loans program was undertaken last autumn. What has been done in that respect since is quite additional to what has been done before. The co-operation of banks was enlisted and a new program was undertaken in this respect, and because this source is regarded as such a hopeful one for the provision of employment, a campaign was undertaken to promote the awareness on the part of Canadians of the fact that home improvement loans were available as well as farm improvement loans.


William Moore Benidickson: Farm improvement loans and home improvement loans arranged through the chartered banking system in this country have been available for years. There is nothing new in this regard except that the terms of the loans change from time to time as a result of the amendments regarding the amounts, and so on. I was referring to something that is new-small business loans-where again the enlistment of the chartered banks' support is made with the banks' numerous branches across the country. Since this legislation was passed it has been possible for businessmen to get small business loans. When this new legislation was introduced it was suggested that there was an accumulation of perhaps $65 million worth of work.


Donald Methuen Fleming: It was $75 million.


William Moore Benidickson: Yes, $75 million-I stand corrected-of work that was standing ready and which would be accommodated under this new legislation. The minister will recall that I complained about this later, and said we thought, in order to assist the winter works emergency, this should have been advanced more rapidly. The opposition co-operated in this regard at the beginning and its debate and criticism were reduced to a minimum prior to Christmas. We were very surprised to find that the cabinet had not arranged

these regulations sufficiently in advance so that it would be possible, prior to January 19, for the banks in this country to be ready to receive applications for loans. Since that time a number of inquiries have been made regarding the approach to the target of this $75 million worth of work, to which the minister has referred, by the extension of loans. These were presumably requirements which were ready, on shelf.
A number of inquiries have been made in parliament of the Minister of Finance, because this was legislation initiated by him. It would seem that some of this money is required for advertising, through the Department of Labour, because we have seen advertisements across the country such as the one to which I referred-"Do it Now With a Small Business Loan". I am not referring to home or farm improvement loans, but new small business loans. Presumably because this is a new thing it could not have been provided in the main estimates which were prepared over a year ago. I do feel, however, that since January 19, 1961 when the cabinet's regulations were made public, the Minister of Finance has not been adequately communicative to this house and to the country with respect to progress under this new legislation.
I think on March 9 the hon. member for Port Arthur raised a question in respect of this subject and the reply of the minister was that there was no report available as yet. Later on March 22 the hon. member for Beauce asked what report of progress the minister could give.


Donald Methuen Fleming: Was that not for January?


William Moore Benidickson: Yes, from January 19 to January 31 was the purport of his question. He asked how many loans had been made and what was the total amount involved. At that time the Minister of Finance said he had no information in that regard. I would suggest that while we are dealing with an item relating to the Minister of Labour, we are fortunate this time to have a direct tie-up with an item that appears to have been originally fathered by the Minister of Finance, and I think it is now time for the Minister of Finance to give us some information in a definite way as to the number and dollar volume of loans that had been made since January 19 under the small business loans legislation of this session.


Donald Methuen Fleming: The banks have 30 days to make returns in this respect. If the hon. member had read my answers to these questions instead of paraphrasing them he would have seen that what I had indicated was that if the starred question which was asked was rephrased to include the period

to February 28 I would be pleased to supply that information just as soon as it was available.
As I pointed out, there is no value in asking for a return for the last few days of the month of January because the loans only became available on January 19 and, after all, the processing had to be done after that.
In relation to the figure that has been quoted by the hon. member as to the work waiting to be done, in the discussion of this matter earlier in the session I used the figure of $75 million which, as I pointed out, had been furnished to me by the retail merchants' association of Canada as their estimate of the volume and value of work waiting to be done on retail premises in Canada in the modernization and reconstruction of them.
(Translation):


Mr. Deschatelets:: Mr. Chairman, I simply want to say a few words in connection with item 697 concerning the Department of Labour.
I quite understand that the Minister of Finance (Mr. Fleming) would wish to limit as much as possible a discussion of this item, more particularly if one turns to the third line reading: "for combating seasonal unemployment".
That gives me an opportunity of mentioning again what everybody knows, that until last fall, this government considered unemployment a seasonal occurrence. As a matter of fact, the Minister of Finance will recall that in his budget speech, last March, he only devoted a few lines to the unemployment situation. As a matter of fact, if I remember well-and I am now relying on my memory, so the minister may correct me if I am wrong-he said this: "I hope that the coming spring will create new employment opportunities".
The minister will also recall that we criticized, and rightly so, his observations.
Mr. Chairman, when dealing with this question of unemployment, and more particularly seasonal unemployment, we are always struck by the failure on the part of this government to solve this serious problem for which it seems unable to find a practical remedy.
I have no intention of speaking much longer on that issue. We will have that opportunity, if the leader of the house does not delay too much submitting to the house the estimates of the labour department. I very much hope he will not wait for the last day of the session to do so-as was the case during the last session-so that we may have the opportunity of discussing this lack of
Supply-Labour
policy on the part of the government and a chance of expressing all suggestions which we are able to make, which we never failed to do whenever there was an opportunity.
(Text):


Paul Theodore Hellyer: Did I correctly understand the minister to say that this money had been spent to advertise home improvement loans and small business loans?


Donald Methuen Fleming: I pointed out that the additional amount required is attributable in part to the fact that the banks were persuaded last autumn to undertake the home improvement loan program, a substantial program, and it was considered most desirable in the interest of stimulating winter work that this fact should be brought to the attention of the Canadian public. This resulted in the enlargement of the expenditure for the publicity promotional program over that which was previously contemplated.
I may say that more and more companies, businesses, organizations, associations and all segments of society have been lending support to this campaign of persuading people to undertake as much of the job creating work as possible during wintertime, and have carried the winter work message in promotional media. This is a sample of the kind of co-operation that has been received by the Department of Labour from the public and is warmly appreciated. This has been made possible by the preparation of material by the Department of Labour, information branch, for non-government sources. This in itself has meant that more Canadians are being exposed to the idea of having more work done in the winter when men and materials are available, at a time when, quite apart from unemployment attributable to other causes, we have always had the problem of seasonal unemployment. It is estimated that for every dollar spent on paid advertisement by the government in this regard $10 has been contributed from outside sources. This includes, of course, not only national publicity but also local support which has greatly increased this year as a result of greater concentration across Canada by the local offices of the national employment service.


Paul Theodore Hellyer: That is what I thought I understood the minister to say and I must admit I am surprised to have it confirmed to me. This government has endorsed some very strange principles. In many instances it has introduced what might be referred to as the Houdini system of accounting. The Minister of Public Works was asked in this house to consider the advisability of the chartered banks making loans at the current

Supply-Labour
National Housing Act rate. In reply, he said, with a certain amount of obvious righteousness, that the government would not consider tinkering with the bank rate; that it must continue the bank rate; that it must not allow a change to take place which would increase the charge to the Canadian taxpayers for loans made to them by the chartered banks; and he imputed political motives to us for making this suggestion.
And yet, Mr. Chairman, here we have the Minister of Finance doing the same thing by the back door method. Instead of allowing the chartered banks to increase their rates he says, "If you do what we ask you, we will do your advertising for you so that it will reduce your costs of doing business". This is a very strange principle, indeed.
The government refuses to face the fact that the banks will not make a certain type of loan at the rates which they are allowed to charge by law; but in order to encourage them to make the loans which the government wishes to have made the government says, "We will take some money out of our back pocket and we will do the advertising for you so that people will come to your doors and ask you for loans, and in this way we shall be mitigating the effect of the statutory limitation on the interest rates which you are allowed to charge." This is a most surprising thing, Mr. Chairman. The Minister of Finance has done similar things with his obvious polish and sleight-of-hand in some of his bond savings campaigns. Therefore, he seeks to do by one indirect method what he refuses to do directly because of the political consequences of taking direct action.
Here we have the government of Canada spending the taxpayer's money to advertise private businesses, to advertise that private businesses are open to receive applications for business from the public at large. What principle could be more questionable than this one? I should like the Minister of Finance to explain to the committee why we should vote money to the government of Canada to enable it in effect to subsidize the rate of return which private institutions are able to obtain from the loans made to taxpayers who have to foot the bill for these expenditures on advertising.


Donald Methuen Fleming: Mr. Chairman, this is one of the most ridiculous assertions, I think, that this committee has heard. I can only conclude that the hon. member has some animus toward the idea of having the banks launch with some vigour into a program of home improvement loans. I may say it was a matter of no little satisfaction to the government last autumn when, in discussion with the banks, we found the banks willing to 
undertake an invigorated program of home improvement loans. This obviously was going to be a source of employment particularly during the winter months because this is the type of work that can be carried on indoors.
If it is a justifiable policy on the part of the government to seek to increase employment during the winter months, then I should think it is not only equally justifiable but equally a duty of the government to see that as much use as possible is made of the facilities thus created. That is why, within the scope of the promotional program to which I have referred and which was provided by parliament in the main estimates for this purpose, the fact that the banks were providing home improvement loans was made known as one of many matters that indicated to people throughout the country that facilities existed making it desirable for them to undertake these job creating programs during the winter months.
This program has been successful because the expenditure of money on this promotional campaign has unquestionably had the effect of creating jobs, and it strikes me that this is hardly an occasion for a rebuke to be administered to the government by the hon. member. If it is the wish of hon. members that there should be no more unemployment than can be avoided and if it is the policy on the part of hon. members that work should be provided in the winter to meet the problem of seasonal unemployment, then I should think it would be the desire of hon. members to make this effective without dredging up accusations out of whole cloth, out of imagination, sheer fictional suggestion, that the government is trying to help the banks. In this situation the government is trying to help to provide employment.


Paul Theodore Hellyer: Mr. Chairman, I did not expect much business acumen from the minister but surely he knows that any private business will spend its own money on advertising if it can engage in a venture which is profitable for it, and the mere fact that the government has to subsidize the banks is an indication that what they have been asked to do by the government would not otherwise be attractive to them.
If the minister is correct in his contention that it is legitimate for the government to advertise the particular services that are available, he can extend this principle to any field whatsoever. Surely if the government merely wishes to provide employment and is interested in doing so, it can subsidize any business. It can provide back door benefits to any business. That is precisely the objection, that this is a back door subsidy, a back door arrangement, back door

assistance rather than a forward approach so that the people of Canada will know the actual cost of the service they are receiving.
Here we have an instance where the banks will make loans at 6 per cent for home improvements while at the same time, according to the annual report of Central Mortgage and Housing Corporation distributed yesterday, they are not the least interested in making loans at the same interest rate for new housing. Why not? There must be some reason that the one is attractive to them while the other is not.
Surely one of the reasons is the fact that the minister has lifted from them the burden of servicing part of this particular business venture by reason of his assistance through the provision of free advertising. Perhaps the minister would be good enough to indicate the amount of free advertising he has provided on the basis of the different mass media listed in the details and also tell the committee whether any of this money was spent on advertising in the foreign language press of Canada.


Donald Methuen Fleming: The break down of the total amount of $332,000 is as follows:
(a)	Advertising in daily, weekly and
farm newspapers	 $102,200
(b)	Advertising in trade, ethnic and
national magazines	 48,000
(c)	Spot announcements, etc., through
radio and television	 80,200
(d)	Public relations, production charges
and reserve for rate increases	 21,600
(e)	Posters, pamphlets, payroll stutters
and billboard paper	 68,700
(f)	Advertising mats, postal cancellation
dies and post office householder mail 4,500
(g)	Films and slides for television and theatres, article reprints and exhibits 6,200
(h)	Public service radio discs	 600


Mr. Fisher:: Mr. Chairman, it seems to me that the minister has been rather unfair to the hon. member for Trinity. After all, the minister seems to be hiding behind the unemployed in denying the principle that has been put forward by the hon. member for Trinity. We welcome so much these statements of principle from the Liberal party, this declaration of faith in free enterprise and the need to keep it pure from any government support and subsidization. After this clear statement the minister gets up and suggests that these factors really do not count, that we are involved in the matter of assisting the unemployed.
I know the hon. member for Trinity is not going to let his principle of the purity of free enterprise be clouded by that kind of issue. After all, if the hon. member for Trinity has a principle I am sure he wants to
Supply-Labour
stick to it. Maybe this advertising will help the unemployed and may create jobs, but if you have a principle you are going to stick to it. At least, I feel that seems to be the line of the hon. member for Trinity.


Paul Theodore Hellyer: Your principle is pure nonsense.


Douglas Mason Fisher: It seems to me that one could almost turn it the other way round and say that perhaps the situation is that private enterprise in the form of the banks is subsidizing the government, which would give you a real question of principle. It seems to me that perhaps we should ask the hon. member for Trinity for a further explanation of this principle he has enunciated for the Liberal party today, this principle of no mixture at all of private and public enterprise.
It seems to me the minister has been quite cruel in suggesting that the unemployed really deserve consideration ahead of this great principle of the Liberal party. Mind you, we welcome very much knowing where the Liberal party stands on questions of principle such as this one involving no truck or trade by the government with private enterprise so far as any subsidies are concerned. It seems to me that this will lead to quite a number of denials on the part of the Liberal party, including a denial of the mixed economy about which we have heard the Leader of the Opposition talk.
It is also going to raise a question about the role of Central Mortgage and Housing Corporation and even about such firms as Eldorado, a government corporation that seems to be in the news these days, with respect to its dealings with private enterprise. As a matter of fact, there are some well known private enterprises that once had something to do with the hon. member's party. I do not wish to say more except that it has been delightful to have had this little talk about principle. Now we know where the Minister of Finance stands. Now we know where the Liberal party stands as outlined by the hon. member for Trinity.


Paul Theodore Hellyer: Mr. Chairman, the twisted and tortuous words we have just heard from the hon. member for Port Arthur are such unadulterated political garbage they do not deserve to be even mentioned let alone recorded. The hon. member has such a facility for getting in the ditch at the first intersection that he may not have recognized there is another principle involved here. I refer to the fact that the government may be using this advertising campaign to line the pockets of its friends, and using the opportunity so presented for political patronage.

Supply-Labour
I have examined one or two of the advertisements and they can be construed equally as political propaganda as they can be in giving encouragement to the particular service they are trying to sell. I hope the government will be extremely careful in the spending of public funds not to incur commitments, the main purpose or the only purpose of which, is merely to try to win friends and influence people, especially since the government is preparing to ask for another judgment of the Canadian people.
(Translation):


Mr. Valade:: Mr. Chairman, I did not propose to take part in this discussion because I know that we will have an opportunity of coming back to it when the estimates of the labour department are voted.
However, I do want to refute the entirely uncalled for remarks of the hon. member for Maisonneuve-Rosemont (Mr. Deschatelets) to the effect that the methods used by the Conservative government in order to stimulate employment in this country have completely failed. I think he is entirely wrong. He should rather have mentioned that the policy of the provincial Liberal party was a complete failure because it did not avail itself of the facilities put at its disposal by the Conservative government in order to create employment. Contrary to the failure which my friend alluded to a few moments ago, 15,000 more jobs were created in the city of Montreal this year, thanks to the policy of the Conservative government-
(Text):


The Deputy Chairman:: Order. The Chair has been quite lenient in this debate. After all, we are discussing the question of advertising in connection with seasonal unemployment. We are not discussing the whole question of unemployment in the various parts of Canada.


Georges-J. Valade: I was just saying, Mr. Chairman, that as a result of the advertising that was undertaken in Montreal 15,000 more employment opportunities have been created.


Chesley William Carter: Mr. Chairman, I just want to set the record straight with relation to what was said by the hon. member for Port Arthur a few minutes ago. The hon. member for Port Arthur seems to have gotten his principles mixed, if he has any principles at all. The whole principle at stake, and the whole point the hon. member for Trinity was trying to make, was that we should be straightforward and honest in what we do. We should not use subterfuge to obtain an objective indirectly which, for political reasons, we prefer not to attack directly. This is the prin-

ciple at stake, and I commend it to the hon. member for Port Arthur and to his party.


William Moore Benidickson: This item is couched in rather general language, and we find a number of subjects apparently are involved. The purpose of the item is said to be to combat "seasonal unemployment", the organization and use of "workers for farming" and related industries and "assistance to the provinces". It seems to me that this is the appropriate time to ask the Minister of Finance who, after all, has to be consulted with respect to all new programs, before they develop, with regard to including under unemployment insurance those seasonal workers who have been employed on farms. I do not need to remind him that for the last couple of years farm organizations have made representations along this line.


Charles Edward Rea: Order; I think perhaps the hon. member is straying away from the subject matter of this .vote. I believe this vote is for the promotion of these particular things and we should not discuss whether or not they should be done.


William Moore Benidickson: I draw to the attention of the committee the fact that there is a reference in the wording in this vote to a promotional program to "assist the provinces" and for the "organization and use of workers for farming". I point out to the committee that at least the Manitoba minister of agriculture, Mr. Hutton, has indicated as late as this month that his government favours the extension of unemployment insurance to farm workers. I was wondering what the development was along this line.


Donald Methuen Fleming: Mr. Chairman, that has nothing whatever to do with this item. This item is related to a publicity and promotional campaign. It has nothing whatever to do with the question of amending the Unemployment Insurance Act. At a later point in the session the government's bill dealing with this matter, as announced in the speech from the throne, will be submitted to the house.


William Moore Benidickson: Now we have the truth. This item has no relationship to anything except a "publicity and promotion campaign". Despite this other very fine language in the vote about the special services branch dealing with promotion programs for "combating seasonal unemployment", for "assisting workers on farms", who we know are on a seasonal basis, and for the "assistance of provinces" in connection with agreements, the Minister of Finance said this item, in essence, is simply a publicity item.


[Stage Direction]
Item agreed to.

698. To carry out the purposes of the Technical and Vocational Training Assistance Act (superseding the Vocational Training Co-ordination Act) -payments to the provinces-further amount required, $450,000.
Walter George Pitman: This particular item seems to relate closely to an important piece of legislation which was put through this house at the last session. The amount of the appropriation outlined here seems to be small. I wonder if the Minister of Finance could indicate what provinces have been assisted by this program. Perhaps he could even tell us how many areas within a province have been assisted, and possibly how many men are being trained.
I ask these questions because $450,000 is such a minute sum in terms of technical education, which is a very expensive type of education when one considers the facilities and machinery required. I should like to have a detailed account of exactly how this money is being spent in this very important area of the Department of Labour.


Donald Methuen Fleming: If the hon. gentleman will look at the main estimates and the previous supplementary estimates, he will see that parliament has already provided about $9 million for this purpose. This additional supplementary estimate is required to provide for the expenses arising out of the agreement which was recently completed with the province of Quebec for sharing the costs of training unemployed workers under schedule M of the special vocational training projects agreements.


Chesley William Carter: Could the minister tell the committee on what basis these agreements are being worked out? Is it the same basis for each province or is each province treated separately?


Donald Methuen Fleming: The basis is uniform. It used to be a 50-50 basis, but the federal share has now been increased to 75 per cent.


Paul Theodore Hellyer: It is interesting to see the liberally minded C.C.F.'er from Peterborough getting on the bandwagon in respect of this program which was espoused by the Liberal party and which is, at long last, being acted upon with halting steps by the present administration. I wonder if the minister could tell us what part of this total allocation for the year has gone to the province of Ontario?


Donald Methuen Fleming: So far as the estimate under schedule M is concerned, the estimated federal cost in respect of the province of Ontario is $100,000.


[Stage Direction]
Item agreed to.
Supply-Labour
Unemployment insurance commission-
699. Administration of the Unemployment Insurance Act-further amount required, $1,850,000.
Jean-Paul Deschatelets: I wonder whether the Minister of Finance can supply me with the following information. I should like to know how many prosecutions have been launched against individuals in the past 12 months for having illegally collected unemployment insurance benefits? Has the minister these figures?


Donald Methuen Fleming: Mr. Chairman, I have not the figures on the prosecutions but I shall be glad to furnish that information to the hon. member.


Lionel Chevrier: If one looks at the details, one notes that the amounts seem to be rather substantial. I wonder whether the minister could give a breakdown of them. For instance, there is an amount of $1,500,000 for salaries and wages. Can the minister give the reason for that amount? Then there is an amount of $240,000 for postage. Will the minister explain that amount?


Donald Methuen Fleming: The amount of $1,500,000 is required to pay 44 new enforcement officers and 963 man-years of additional casual employees. The estimated cost for this fiscal year is $2,175,000 but only $1,500,000 is required as the balance has been made available out of the former appropriation, because of unfilled positions in the regular staff which were higher in number than expected.


Lionel Chevrier: Are these casual employees in the various offices across Canada?


Donald Methuen Fleming: Yes.


Lionel Chevrier: What is the explanation for the amount of the postage item?


Donald Methuen Fleming: It relates to the claims load which was higher than expected.


Paul Theodore Hellyer: On March 9 the hon. member for York-Sunbury, in a question of which he had given notice, asked the Minister of Labour what would be done to tighten up the regulations which were presently allowing thousands of men and women in Canada to draw unemployment insurance benefits when there were job opportunities available for them in their own industries. In his reply the Minister of Labour did not deny that there were thousands of jobs available in the industries to which these people ordinarily would be attached, and he went on to say that the regulations were being tightened up and for that reason certain additional expenditures had been undertaken. I assume they are covered by the moneys that we are presently being asked to vote. I wonder

Supply-Labour
whether the minister would be good enough to indicate precisely where the thousands of jobs are and how many there are in each industry and in each province, so that we shall know exactly what it was that the hon. member for York-Sunbury and the Minister of Labour were talking about.


Donald Methuen Fleming: I have not before me the details of that question and answer to which the hon. member refers. If information is required in detail, I am sure the unemployment insurance commission can supply the list it has of the vacancies for persons who are qualified. I presume it becomes a question of qualification for the particular vacancies that exist.


Paul Theodore Hellyer: In view of this rather serious allegation that reflects on the principles of thousands of unemployed persons in this country, I wonder whether the Minister of Finance would be good enough to undertake to get this information from the unemployment insurance commission and to make it available to the committee later on during this debate. These were serious charges that were made in saying that there are thousands of people drawing unemployment insurance benefits who could be working if they wanted to work. I think that we should have some further words from the minister on this matter before we start to vote money in order to prosecute people holus-bolus, when the minister has not more information to give us in this regard.


Donald Methuen Fleming: The hon. member has overlooked the fact that this item does not relate to the sums paid by way of insurance benefits. This item relates to the further amount required to provide for the costs of the administration of the commission.
In so far as the information he seeks is concerned, may I say that any information of that kind can be made available, I presume, by the unemployment insurance commission. But with respect, Mr. Chairman, may I say that I do not think it relates to the subject now before us. This matter of enforcement has now been reported to the committee. I have given the committee the figures to indicate how the amount is broken down, and to indicate the amount required to complete the enforcement to March 31, of this present fiscal year three days hence. We are not here dealing with the 1961-62 estimates nor are we dealing here with the bill to amend the Unemployment Insurance Act. That bill will come to the house at a later stage of this session.


Mr. Marlin (Timmins):: Am I to understand from the minister that this increased cost is owing to increased administration costs

brought about through this tightening up process that was referred to?


Donald Methuen Fleming: Yes. I pointed out how the largest element in the item, namely $1,500,000' for salaries, is made up. It is to provide for the services of 44 new enforcement officers and then the casual assistance required by the commission in its various offices for all purposes.


William Moore Benidickson: We have here an item for an additional amount required for administration of the Unemployment Insurance Act. I have not in front of me at the moment the Unemployment Insurance Act. The minister, with the details in front of him, is probably better informed at the moment than am I. But am I not right in thinking that having regard to the terms of the Unemployment Insurance Act, the administration will include not only services with respect to persons unemployed and drawing unemployment insurance benefits but under this act will have responsibility under other sections which provide for employment services?
Having regard to recent discussions concerning Mr. Exelby, am I to understand that henceforth if members of parliament want to place on the order paper questions that do not relate especially to anonymous questions relating to statistics, they could, with respect to services rendered by the employment services under this act, ask the ministry as to what specific opportunities had been offered, for example, to Mr. A., Mr. B. or Mr. C? Has the government given consideration to this matter? Is that likely to develop from the expose by the Minister of Labour with respect to services rendered by the employment services section under the Unemployment Insurance Act administration in relation to one person?


Donald Methuen Fleming: I have not given consideration to that question, Mr. Chairman. I presume that is a question on which it would not be proper for me to comment in advance.


Charles Edward Rea: Order. It being five o'clock, it is my duty to leave the chair-


Donald Methuen Fleming: Mr. Chairman, can we carry this item and complete this department?


Paul Theodore Hellyer: I think the item had better stand, Mr. Chairman. The minister may have a change of heart and wish to provide us with some of the details for which we have asked.


Charles Edward Rea: Order. It being five o'clock, it is my duty to leave the chair in order to permit the house to proceed to the

consideration of private and public bills, pursuant to section 3 of standing order 15.



PRIVATE BILLS

Mr. Speaker:: As there are two private bills standing on the order paper for consideration in committee of the whole does the house wish, in accordance with section 1 of standing order 54, that they be referred to the committee of the whole in one motion?


Some hon. Members:: Agreed.



CONSIDERED IN COMMITTEE


[Stage Direction]
Bill No. S-10, to incorporate Canadian Pioneer Insurance Company.-Mr. Cardin.
Bill No. S-14, respecting Canadian General Insurance Company.-Mr. Ricard.

[Stage Direction]
On the order:
Second reading of Bills Nos. SD-I to SD-179 inclusive-Mr. McCleave.
Mr. Mandziuk:: May these stand?


Mr. Speaker:: It is requested by the hon. member for Marquette, on behalf of the hon. member in whose name these bills appear on the order paper, that they should stand. Is it the pleasure of the house that they stand?


Some hon. Members:: Agreed.



AURORA PIPE LINE COMPANY

[Stage Direction]
The house resumed from Tuesday, March 14, consideration in committee of Bill No. S-2, to incorporate Aurora Pipe Line Company-Mr. Woolliams-Mr. Rea in the chair.
On clause 1-Incorporation.
Hazen Robert Argue: Where is the mover?


Murdo William Martin: In the absence of the mover, and, indeed, of the supporters of this bill I should like to move that we rise, report progress and ask leave to sit again.


Charles Edward Rea: Would the hon. member give me a motion in writing to that effect? It has been moved by the hon. member for Timmins:
That the committee rise, report progress and ask leave to sit again at the next sitting of the house.
Motion (Mr. Martin, Timmins), negatived: Yeas, 5; nays, 41.


Murdo William Martin: I could not help wondering, in the absence of the mover of this bill, whether, possibly, he might not have listened to the hon. member for Vancouver South and reached the conclusion that the bill was not as good as he might have thought it was in the first place.
Private Bills


Mr. Chown:: If I may intervene on a point of order, I think the hon. member for Timmins spoke on making his motion, and now he is speaking again. Under the rules there should be an intervening speaker before the hon. member rises again.


Frank Howard: On that point of order-


Charles Edward Rea: The hon. member for Timmins.


Murdo William Martin: It is true I did have a few minutes to discuss this particular bill which appears to be sponsored in this house by the Social Credit wing of the Conservative party, the hon. members for Bow River, Acadia, and Jasper-Edson and others. As I pointed out the other day, I do not know just why they should be doing this. They seem to be contravening the policy of their party and the policy of their leader. Certainly, they are flying in the face of the remarks which have been made by the hon. member for Vancouver South.
However, during the period when this bill has been debated, they have sought to create the impression in this house that everyone in Alberta is behind this bill, that support for it is unanimous, and that the measure is being held up by a bunch of irresponsible people. That is very far from being the truth, and I should like to point out something which will completely refute this effort to try to fool the house in this regard. I have here a copy of the Calgary Herald dated Thursday, January 19, which contains some very pertinent comments relating to this debate. I should like to quote briefly from these remarks. The newspaper states:
Mr. Harold Winch, C.C.F., M.P., quite rightly raised the question of national interest in the matter of a company seeking incorporation of a pipe-line operation when the subject came before the House of Commons Tuesday.
The points which he raised are certainly points significant in the over-all question of Canadian participation in development of its own resources. Surely there is no better place than the house to air the matter.
This is exactly what the members of this party have been trying to do in this regard assisted to a great extent, I hasten to add, by the hon. member for Vancouver South, who seems to be under no illusion whatsoever with regard to this bill. The article goes on to say:
Mr. Winch performed a service by pointing out that the bill would incorporate Aurora Pipeline Company, owned by Hudson Bay Gas and Oil Company of Calgary, which is in turn owned 68 per cent by the Continental Oil Company Limited, a United States corporation.
Mr. Winch pointed out that a Canadian company. Foothills Pipeline Company Limited, a subsidiary of Canadian-owned Pembina Pipeline Limited, is also seeking permission to export the by-products, although not by the same route or with the same objectives as Aurora.

Private Bills
The article continues:
"Serious consideration" should be given to whether the Aurora incorporation would benefit Alberta, he declared. And, certainly, that should be a consideration of the House of Commons.
This is something that we in this group have pointed out on more than one occasion. We have always been held up to scorn in doing so by the social credit wing of the Conservative party. They have attempted to lead us to believe that the bill is very definitely in the interest of, and has the support of the whole of the province of Alberta.
This article continues as follows:
The opportunity for Canadian participation and a considerable measure of control by a Canadian company is provided for in the Foothills proposal. It is a consideration to which these bodies must give the greatest weight.
The hon. member for Vancouver South pointed out very clearly that this bill in its present form is a complete negation of the policy that has been expounded by the Prime Minister and the Conservative party, and that it is something to which parliament should certainly give more consideration. We have been told not to bother in this regard. It has been suggested that after all there are fuel boards, both national and provincial, which will look after these details. The article appearing in the Calgary Herald has reference in this regard. It reads as follows:
The boards have the facilities and the personnel able to assess the technical aspects of all proposals. But a strictly technical view is not enough in itself. The Canadian view must also be taken and, for putting it forth in the house, Mr. Winch should be thanked. His fellow members would do well to have that view in mind.
One of the important objections to this bill is the fact that this Canadian view regarding the development of Canadian resources is completely forgotten.
Oil and gas represent a most valuable and important resource which this country possesses. The rank and file of Canadians across this country, who are the consumers of these resources, have been gouged very severely as a result of the sell-out of these resources to particular interests in this field of production. We saw an example of this in the pipe line debate of 1956. Fortunes were made by a few individuals at that time, of course, the consumers, of this and future generations, must bear the cost of providing these fortunes. An unnecessary amount of money has been written into the cost of selling these products for the benefit of a few privileged individuals, and this is the type of thing we in this country can well do without, in respect of our natural resources. In order to avoid further sell-outs of this type, which result in the loss of thousands of dollars, we should be more careful in the future than we have been in the past.

Those hon. members on the government side of this chamber, who apparently are in favour of this bill, should heed the words of one of the ministers of the crown, and I refer to the present Minister of Agriculture, who was the former minister of northern affairs and national resources. What he has said in the past in regard to our natural resources I think is very appropriate at this time during the discussion of this bill.
I would like to refer to some of his remarks which can be found at page 3323 of Hansard of August 9, 1958, in a speech which I made at that time. He is quoted there as follows:
To be very blunt about it, If you go back to the experience of the second world war you will find that the American government was very much concerned about the rapid depletion of their strategic resources and there was set up a presidential committee in that country to examine into this matter. This committee reported in 1952 and their report is known as the Paley report. The Paley report says in plain English that the resources of the United States of America are not unlimited and that, at the present time, they are in a deficit position so far as total resources are concerned to maintain their industrial economy. Naturally they have to seek out reserves both of energy and mineral resources in every land.
We have seen examples of their seeking out of these resources, unfortunately to our sorrow, on more than one occasion.
The minister had more to say in this regard which is becoming more pertinent as time goes on. He is reported on the same page as follows:
-we are the nation on the northern half of this continent and we want to make certain that the interests, not only of the present generation, are protected, but that the interests of generations unborn will also be preserved.
I think those remarks are exactly in line with what hon. members of this group have said in regard to this measure and other similar measures.
At the same page the minister is quoted further as follows:
We in Canada, whether because an act of grace, or because of our geographical location, or simply as a result of inertia, have not had our resources depleted so widely as the American resources have been depleted, without plan.
That again is something completely in line with the stand we are taking. Here we have a minister of the crown agreeing completely with this group in this regard but still we have this bill being promoted at this time by certain member of the government side of this chamber.
From the same source I repeat the following quotation:
We may have, either by the grace of God, or by our own inertia, been saved from having misused our resources.

I cannot help but wonder at the thinking and inconsistency of hon. members on the government side when some of them, as the minister, recognize this problem, while others insist on blindly promoting and executing the things condemned in the words of the minister.
Beginning on the same page and carrying over to the next, the minister is further quoted as follows:
It is simply that we have a determination to avoid these mistakes, if possible, in our country in relation to the future development and efficient use of those resources.
Does this bill represent an example of that determination to avoid these mistakes in the future? Is this the way the government intends to avoid making these mistakes, which the hon. minister recognized as having been made before, the depletion, waste and squandering of the resources in the country to the south? I suggest by the passage of this bill we will be encouraging those individuals to come in and do the same in this country, regarding our natural resources, as they have done in regard to their own.
The Minister of Agriculture, the then minister of northern affairs and national resources, had more to say regarding this subject. He is quoted at page 3324 of Hansard of August 9, 1958 as follows:
Because we have great reserves of minerals of all kinds, Canada is a great centre of interest in an economico-political way. For that reason, some consideration and logic had to come in respect of exploitation of these resources.
I would like to heartily endorse the words of the minister in this respect and suggest that it is about time we had some logic regarding these resources. I fail to see the existence of logic in the bill that is presently before us.
Later on the same day, the minister is quoted as saying:
-there is no use in doing all this work if there is not some thought given to a long range conservation concept of the most efficient use of those resources.
The hon. member for Timiskaming has pointed out the need for developing secondary industries and using those resources to build our own country into something other than a country producing primary products. If we are to avoid becoming hewers of wood and drawers of water, something to which the Prime Minister and the members of his cabinet have referred from coast to coast in this country, then certainly we cannot endorse bills of this kind.
Finally, the minister went on to say:
I want to make it clear that unless we formulate a plan for the use of our resources we may lose the long range strategic necessity of having control of those resources in our hands,-
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How true, Mr. Chairman. I continue:
-either for world use, or for people over the world, or most effective use in the North American economic picture.
Well, maybe this particular bill would fit in the North American economic picture but certainly it will not fit into the Canadian picture. If hon. members on the government side cannot agree with the C.C.F. that in a matter of this kind we should consider the benefit to Canadians as a whole, then surely they should listen to their own minister and his plea to try to avoid the mistakes of the past. If they cannot agree with the so-called policy of the Prime Minister and of the members of the Tory party, how do they expect the people are going to believe the Prime Minister at all if he rises in his place and expounds one view and then members of his party advocate a bill that is exactly the opposite to what he expounds?


Mr. Horner (Acadia):: The hon. member does not know what he is talking about.


Murdo William Martin: I wish the hon. member who made that interjection would rise in his place and tell us what he is talking about.


John (Jack) Henry Horner: On that very point, I am talking about the fact that this company wishes to export a product which is gasoline. The company said that 90 per cent of the product they wished to export is gasoline. This is a product that we have a surplus of in western Canada. How we can develop further industry out of gasoline is beyond my comprehension. If the hon. member looked at it in that light he would probably agree with me. If the hon. member says it is not gasoline, why did not the hon. member of his party in the committee question the statement of the representative of the Hudson's Bay Gas and Oil Company who said in the committee that it was gasoline?


Murdo William Martin: We seem to be learning more about this bill all the time. During the discussion of this bill we have had a difficult time eliciting any information at all. First of all, no record was kept of the committee meetings in the other place-


John (Jack) Henry Horner: This information is on the records of the committee. Read the record.


Frank Howard: On a point of order, may I draw to your attention, Mr. Chairman, the fact that there is one vocal member on the other side who has not the courtesy to rise before he speaks. I wonder whether you would draw the rule to his attention.

Private Bills


John (Jack) Henry Horner: The hon. member who had the floor asked me to give him the information and I did so.


Murdo William Martin: That is not exactly in accordance with the fact. I heard an interjection from somewhere across the floor and I did not realize at the time it came from the hon. member. However, we do not mind these interruptions, Mr. Chairman.


Mr. Fane:: It uses up more time, and that suits you.


Murdo William Martin: However, Mr. Chairman, if, as I said, the Social Credit members-they are not really Social Credit members, but the hon. members who are taking the Social Credit stand on this particular bill-will not listen to the Minister of Agriculture, and if they will not agree with the stand of their Prime Minister and their allegedly official party policy, then, surely, as a last resort they will listen to the hon. member for Vancouver South and will apply to this bill the principle that was recommended by him.
If they are to insist that the resources of this country must be developed by the quick buck artist method which is, of course, another name for the racket that is called free enterprise development of our resources, then, in heaven's name, if this is the way we have to go along in the development of our resources, as the hon. member for Vancouver South suggested, let it be a Canadian racket and not a United States racket. Even that, Mr. Chairman, is preferable to the bill in its present form.


Mr. Speakman:: Mr. Chairman, I do not want to delay the passage of this bill very much, but I should like to ask a couple of questions which rather puzzle me. We have listened to the group in the corner to your immediate left for several long sittings talking about this bill. These are the champions of the unemployed; these are the champions of labour. The purpose of this bill is to build 41 miles of pipe line, to provide employment for unemployed Canadians, to sell a by-product, not a product, already developed, and these champions of the workers in Canada are denying to Canadians employment which would become effective almost immediately on the passage of this bill and final approval.


Murdo William Martin: Since the hon. member saw fit to intervene at this time, would he give the committee any assurance that if this bill passes and if the pipe line is undertaken it will give employment to Canadians and not to people of the United States, as was the case in nearly all the previous pipe lines built across the country?


Gordon Campbell Chown: All of the information the hon. member has asked for is on the record. A letter was read into the record by the hon. member for Bow River, the sponsor of this bill. The letter was from the financial vice president of the company, assuring this house that if this pipe line should be authorized by the national energy board, and by the conservation board of Alberta, Canadian labour, and nothing but Canadian labour would be employed in the construction of the pipe line.
Very briefly, and without taking too much of the time of the committee, I want to put on the record the composition of the employees of this company. There are 371 Canadians employed, or a total of 90 per cent of the over-all-


Mr. Peters:: Employed by which company?


Gordon Campbell Chown: This is the Hudson's Bay Oil and Gas Company Limited. As I said, 371 Canadians are employed, or 90 per cent of the total number of employees. There are 21 from the United States, or 5.1 per cent; 14 British, or 3.4 per cent; 3 Australians, or .7 per cent; 2 Hungarians, or .5 per cent; and one Indian, from India, representing .2 per cent.
Now, as to Canadian participation, or the opportunity for Canadians to participate on a broader scale in this company, I have a letter dated March 17, 1961, from K. H. Burgis, financial vice president of the Hudson's Bay Oil and Gas Company Limited, which is addressed to Mr. Eldon C. Woolliams, M.P., House of Commons, Ottawa, Ontario, and reads as follows:
Dear Mr. Woolliams:
With respect to the question raised by Mr. Broome in the debate on March 14 last regarding possible plans to increase the percentage of Canadian participation in the ownership of Hudson's Bay Oil and Gas Company Limited, I would advise that the management of the company anticipate a continuing growth in Canadian participation. At the present moment the company does not have any need for additional equity capital to finance its operations and accordingly, cannot make any definite prediction as to the timing or possibility of a further issue of treasury shares which could be offered to the Canadian public. However, we believe the past actions of the company in making a distribution of a portion of its capital stock back in 1957 before there was any strong public clamour for such action is the best possible kind of indication of the company's attitude and thinking on this subject.
The shares of the company were listed on the Toronto stock exchange in 1957 and since that time have been actively traded and have been readily available for purchase by any Canadian who wished to invest in the company. In fact, since 1957 there has been a steady growth in the number of Canadian shareholders and a proportionately greater growth in the number of shares owned by Canadians.

I might also add that the company has issued and sold to Canadian investors three debt issues which in total amounted to $28,600,000.
If any final evidence of the good faith of this company is needed I do not know what we can offer. Everything that has been controversial about the bill or has been questioned has been dealt with by the hon. member for Bow River and others. Hence I can see no reason for delaying the passage of the bill any more than I could see any reason for delay in the passage of the Northern Pipe Line Company bill or the Matador Pipe Line Company bill, which I happened to sponsor, which was wholly American owned and went through the house with no resistance whatever.
My suggestion and challenge to those who oppose the bill now before us is to put it to a vote and let their position be well and truly known from one end of the country to the other. I will be one of those who will go out and defend the government; defend my sponsorship of the bill, together with the hon. member for Bow River, in any part of the country.


Frank Howard: Mr. Chairman, I should like to say a word or two with respect to what the hon. member for Winnipeg South has just said. He said that he would be one who would be prepared to go out and defend the government on this measure.


An hon. Member:: He corrected that.


Frank Howard: Let me finish. Don't be impatient. Those are the words he used and then he corrected himself by saying that he would be prepared to defend his position on the bill. I submit it is this type of slip of the tongue that really tells the true story, and while the hon. member did correct himself I submit there was more truth in his initial statement about defending the government with regard to this measure than in his corrected statement about his own position and the position of the sponsor of the bill.
Be that as it may, there were also some interesting comments by the hon. member for Wetaskiwin which I think should be explored further. I understood him to say, and if I misunderstood I am sure he will correct me immediately, that under the bill the company proposes to build a 41-mile pipe line. There is no contrary indication by the hon. member so I assume that I understood him correctly. Yet we know full well that this is not the purpose of the bill. Its purpose is to establish a company to build half a mile of pipe line, not 41 miles. There are some other miles of pipe line involved in the same way that there are other miles of pipe
Private Bills
line connected with the Hudson's Bay Company in other parts of Alberta and in the same way as there are other miles of pipe line in the case of Continental Oil in the United States.
But the purpose of the bill is not to build 41 miles of pipe line. It is to build half a mile of pipe line and this was made very clear by the sponsor of the bill himself on the occasion when there was some doubt as to exactly what the hon. member for Vancouver South was getting at when he said that the contract had already been let.
The hon. member for Wetaskiwin also dragged out the question of providing employment. We know that the Minister of Justice did the same thing last session when he tried to connect employment with the Combines Investigation Act but the Speaker hauled up short at that time and pointed out that the legislation had nothing to do with employment.
While some employment may develop from the passage of the bill now before us, to attempt to make out that this is part of the policy of the government to provide employment is to stretch things quite a bit, especially when the hon. member for Wetaskiwin said so emphatically that employment would start immediately. That is just not so.


James Stanley Speakman: On a point of order, Mr. Chairman, I said "immediately approval had been given".


Erhart Regier: Employment in the stock exchange.


Frank Howard: Employment may start in the stock exchange. Perhaps it is taking place there at the moment. The statement that employment will start immediately upon approval leads to the question, approval by whom? Approval by the house? This sort of implication means that the Senate need not have anything to do with this matter nor does the governor general need to give royal assent to the bill. It also assumes that this company which is seeking incorporation already has the approval of the Alberta oil and gas conservation board as well as the approval of the national energy board because apparently they have to go to these agencies in order to place themselves in a position finally to start construction.
If the hon. member for Wetaskiwin meant that work on the pipe line could start immediately after approval by these other public bodies had been obtained, that is a different question, but I did not understand him to say that even in his later clarifying statement. It may also be true that some measure of employment will be provided in the construction of half a mile of pipe line-

Private Bills


James Stanley Speakman: Forty-one miles.


Frank Howard: -under the bill which seeks to establish a company to build half a mile of pipe line.


James Stanley Speakman: Forty one miles.


Frank Howard: Half a mile of pipe line is all it is going to build. I do not care how many interjections are made by the hon. member for Wetaskiwin or how much he wants to dress up this project as a major summer works program of the government in office. We have been told many times that the company is going to build half a mile of pipe line. There is no question of 41 miles being built under this bill at all. I have just been handed Hansard for March 6, 1961, and I should like to refer to some comments of the hon. member for Bow River, the absent sponsor of the bill. As found on page 2705 the hon. member used these words:
... to build the halt mile of line joining the Canadian line across the boundary with the United States line.
It is half a mile of line, and that is what we were told would be built. Half a dozen men with picks and shovels would almost be able to build half a mile of pipe line overnight, so any attempt to promote this project as a major contributing factor in providing employment merely for the purpose of bailing out the government because it has not been able to provide employment is just a lot of nonsense.


John (Jack) Henry Horner: Would the hon. member permit a question?


Frank Howard: Not right at the moment. I have extensive notes here. Perhaps the hon. member might ask it at the conclusion of my remarks.


Mr. Smith (Simcoe North):: Are you going to read Hansard?


Frank Howard: No, I have some other books to read which have been suggested by one of your legal friends, the hon. member for Bow River. I am glad you asked that question because perhaps I might make some other references to Hansard before I proceed.


Heber Edgar Smith: It will fill up space.


Frank Howard: At least I will not be sitting in my seat all the time and I will not be drawing on the lord lion of Scotland to help me. I am quoting now from the remarks of the hon. member for Vancouver South in which he was quoting the hon. member for Bow River. The hon. member for Bow River was dealing with subsection (d) of section 44 of the National Energy Board Act and this is what he had to say:
[Mr. Howard.)
-the board must have regard to the question of financial responsibility. That will be considered.
It would almost seem as if the hon. member for Bow River was in fact the national energy board.
It must have regard to the financial structure of the applicant. That will be considered.
Again it would seem that the member for Bow River was in fact the national energy board. I continue:
It must have regard to the methods of financing the line. That will be considered.
Those are rather definite statements.
It must have regard to the extent to which Canadians will have an opportunity of participating in the financing, engineering and construction of the line. That will be considered.
Then on March 13, 1961, the hon. member for Vancouver South went on to talk about the use of the words "may" and "shall". The hon. member for Bow River interrupted at that point and said, as reported on page 2924 of Hansard:
Will the hon. member permit a question?


Mr. Broome:: Yes.


Mr. Woolliams:: I wonder whether the hon. member has read Maxwell on the interpretation of statutes wherein it is stated that "may" may be interpreted as "shall", and vice versa. If he has done so, I should like to hear from him.
The hon. member for Vancouver South gave what I thought was a delightful answer in layman's language. I undertook to consult a member of the legal profession concerning the use of the words "may" and "shall", to ascertain if they could be used alternatively under certain circumstances. I undertook to inquire into just what Maxwell himself may have thought about the use of these particular words because they do seem to have some bearing on what action the national energy board will take with respect to this company.
I have a book entitled "Maxwell on Interpretation of Statutes", the ninth edition by Sir Gilbert Jackson. I do not know whether or not this is the latest edition, but there is a preface in the book by Mr. Jackson which is dated January, 1946. In any event, this is the edition I received from the parliamentary library which I assume is up to date on these matters. At page 246 of this book, with respect to the words "may" and "must", I find this:
Statutes which authorize persons to do acts for the benefit of others, or, as it is sometimes said, for the public good or the advancement of justice, have often given rise to controversy when conferring the authority in terms simply enabling and not mandatory. In enacting that they "may" or "shall, if they think fit" or, "shall have power" or that "it shall be lawful" for them to do such acts, a statute appears to use the language of mere permission, but it has been so often decided as to have become an axiom that in such cases such expressions may have-to say the least-a compulsory force-

I would take it from this that in some cases "may" is a word which could be used, as Maxwell puts it, with compulsory force. In fact, this word may be mandatory in its relationship to a body upon which certain power or authority is conferred.
Section 44 of the National Energy Board Act, to which reference has been made on a number of occasions, uses the word "may". The national energy board may do this or that. The hon. member for Bow River interpreted the word "may" to mean "shall", that it was mandatory on the national energy board and Maxwell pretty well substantiates the hon. member's interpretation. It is mandatory, therefore, for the national energy board to have regard to the financial structure of the applicant, to have regard to the method of financing, to have regard to the extent to which Canadians will have an opportunity of participating in the financing, engineering and construction of the particular line.
These facts raised another point in my mind, just as they did in the mind of the hon. member for Vancouver South. Why in heaven's name do they not use language in these statutes which is easily understood? I am sure that all laymen take the word "may" to be permissive and the word "shall" to be mandatory or contain some compulsion to do something. However, according to the quotation from page 246 of Maxwell on the interpretation of statutes, to which I have just referred, one can use either of the words in the same circumstances and they both contain a certain amount of compulsory force. I believe the hon. member for Bow River, therefore, was quite correct in saying that, although the word "may" is used it means that the national energy board must do these things.
However, I find that both Maxwell and the hon. member for Bow River are quite incorrect. This parliament of Canada has decided otherwise. The parliament of Canada has decided that when you use the word "may" that is precisely what you mean and when you use the word "shall" that is what you mean. Regardless of what the hon. member for Bow River or Maxwell might think about it, this is the decision of this parliament of Canada and I believe that supersedes the interpretation of either Maxwell or the hon. member for Bow River. In the Interpretation Act, chapter 158 of the Revised Statutes of Canada, 1952, section 35, we find the following:
(28) "shall" is to be construed as imperative, and "may" as permissive;
I would take it, therefore, that the argument of the hon. member for Bow River about substituting one word for another was
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either made to lead us off the track into considering that the national energy board would have certain functions which it did not have or he actually believed, as Maxwell has pointed out, that you can substitute one word for the other. However, the Interpretation Act of this parliament tells us otherwise, and we know full well what the national energy board may do.
I merely wanted to clear up this one point, Mr. Chairman, because I feel it does have a strong bearing upon our decision as to what to do with the particular bill before us. The argument has been advanced that the national energy board has been given certain authority and that it will protect the public welfare, that it will ensure that Canadian interests are given primary consideration. An argument was developed from these facts to the effect that because this parliament enacted legislation to set up the national energy board it was designed to protect the interests of Canada and we should, therefore, give only a cursory examination to the bill before us. We should leave it to the national energy board to protect the interests of Canadians.
The section quoted at some length and on more than one occasion by the hon. member for Bow River as supporting this stand was section 44 of the National Energy Board Act. As I said before, I do not have it with me, but it has been placed on Hansard a number of times. The hon. member for Bow River said that it was mandatory upon the national energy board to do certain things and he enumerated them. I think we can see that the argument of the hon. member for Bow River in that regard, even though he drags Maxwell into it, was an incorrect and erroneous one. I think we can see that the national energy board does not in fact have this authority or that it is not forced by the statute itself to inquire into these certain things. It only may do them. It is only permissible that the national energy board do things of this sort.
There is another saving feature, and that is the national energy board may do these things with the consent of the governor in council. To sum up, it is not mandatory that the national energy board inquire into anything and it inquires into matters only with the approval of the governor in council or, in short, the cabinet. These are the provisions of the National Energy Board Act on which the hon. member for Bow River and his other Social Credit friends launched so much of their argument. We find that it has fallen flat because the parliament of Canada, in the Interpretation Act, decided differently a long time ago.

Private Bills


William Arnold Peters: We were mislead.


Jacques Flynn: Shall clause 1 carry?


Erhart Regier: No, Mr. Chairman. I have attended most of the debates on this issue and I have noticed the plea that the committee be permitted to have a vote on the bill. We were appealed to on the basis almost of ethics. We were elected to this House of Commons under certain terms of reference. These terms of reference are contained in the rule book. The rule book that governs the procedure of this parliament is the framework within which we operate. I believe that it is up to the members of the opposition, any time they feel sincerely about any issue before the house, not to heed the plea that every idea or bill introduced in the house be allowed to come to the vote but rather that they should continue to operate within the terms of reference that happen to govern at the time of our election to parliament.
I was very much interested in the remark that we have in the government a branch of the Social Credit party. I had heard previously that there is a branch of the Union Nationale party represented in the government of the day. We now have another branch.
However, to get down to the basic issue, may I say that we are dealing here in this bill with the exploitation of Canadian resources. I have always contended that Canadian resources existed for the benefit not only of Canadians primarily but also for that of all mankind. We as Canadians happen to be in the fortunate position or otherwise of being trustees of this heritage of ours. I do not subscribe to the philosophy of "finders, keepers". I am a great believer in the evolution of economic democracy as I am in the evolution of political democracy. I do not believe that we are fulfilling our responsibility if we subscribe to the idea either of "finders, keepers" or that whoever gets there first ought to be given any particular advantage. I do not believe that it is in the best interests of Canada to hand over to selfish interests the exploitation of any major resource of our country.
I welcome and indeed acknowledge the role of the private entrepeneur on the Canadian economic scene. However, I contend that the day is long past when we can have any major private entrepeneur who refuses to accept responsibility for the welfare of the nation as a whole. At this point I must take occasion to disagree with the otherwise very commendable efforts of the hon. member for Vancouver South, when he mentions that the royalties in Saudi Arabia are as much as that we are fulfilling our responsibility if 50 per cent and that they are negotiating to increase these royalties to 75 per cent. I

could mention that there are other places in the world with oil resources where the royalties are even in excess of 75 per cent.
Progress reported.


Mr. Speaker:: The hour for the consideration of private and public bills having expired, the house will revert to the business that was interrupted at five o'clock.

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



DEPARTMENT OP LABOUR

[Stage Direction]
Unemployment Insurance commission-
699. Administration of the Unemployment Insurance Act-further amount required, $1,850,000.
At six o'clock the committee took recess.

AFTER RECESS

The committee resumed at 8 p.m.
William Hector McMillan: I wonder if the minister could tell us something about the present condition of the unemployment insurance fund. How much is in it, and how many securities have been sold?


Donald Methuen Fleming: That, with respect, does not arise on this item. We have given that information as to the status of the fund a number of times this session in reply to questions on the order paper. I think I have given answers of that kind about every two weeks during the session. Here we are dealing not with the unemployment insurance fund but simply with an item for administration costs. As I said this afternoon, there will be an item before us this session with relation to the fund itself.


William Hector McMillan: I think we should have some information as to whether or not there have been sales of bonds this month and, since there has been some weakness in the bond market, whether or not putting a lot of these bonds on the market has been among the causes of this weakness. In addition we should like to know whether or not the recommendation of the advisory committee that the government should put $133 million into this fund-


Jacques Flynn: Order. I must indicate to the hon. member that in my view these questions are not relevant to the item before the committee.


Lionel Chevrier: I should like to bring to your attention, Mr. Chairman, that we are now discussing the unemployment insurance commission, and in my humble opinion that

commission has to do with the advisory committee, and the advisory committee is responsible for the fund. On numerous occasions in these circumstances it has been our privilege to discuss this question, and simply because the Minister of Finance says this is purely an administrative item should not close the matter. I think we are entitled to argue that this does entitle the hon. member for Welland to ask a few questions. All he had was two or three questions in connection with the fund, and I think that perhaps that would have ended the matter.


Donald Methuen Fleming: The place for the hon. member for Welland to discuss this question would be either on the main estimates for 1961-62 when they are before the committee of supply, or, depending on precisely what his points are, on the bill which will be introduced later to amend the Unemployment Insurance Act.


Lionel Chevrier: What objection could there be to answering the questions-


Donald Methuen Fleming: Because they are not relevent to this item, that is the reason.


Lionel Chevrier: I disagree with the minister. Moreover the minister did not allow me to complete what I was saying. He interrupted me, as he very often does, before my question was asked. I was about to ask the minister what objection there could be on an item such as this dealing with the unemployment insurance commission to answering a few questions on the position of the fund. After all, the fund is related to the commission. If there is a tremendous amount of unemployment the fund will decrease; if not, it will increase. Surely, on an occasion like this the committee is entitled to know the position of the fund, and that is all the hon. member is asking.


Leon David Crestohl: On the point of order, Mr. Chairman, this item asks for a further sum to be made available. The government is asking for an additional $1,850,000. We in this committee are surely entitled to ask: what do you want this money for? Whether the minister can answer or not is another matter, but I respectfully submit we are entitled to ask these questions. We are entitled to know what this amount is intended to cover.


Jacques Flynn: May I indicate to the hon. member that he will find the answer given in the details on page 20.


Donald Methuen Fleming: That is precisely the information I gave to the committee this afternoon when I answered questions regarding the purpose of this additional amount. That information was completely given.
Supply-Labour


Lionel Chevrier: I submit to you, Mr. Chairman, that that is not an answer to the question. To say we will find the answers in the details is humbug, because the details with respect to every one of these two items are simply a repetition of the details to be found in the supplementary estimates we are dealing with now. Just why it is not possible for the minister to answer two or three questions concerning this subject, which is one of vital importance to the people of Canada, I cannot imagine.


Thomas Miller Bell: He has answered every question.


Lionel Chevrier: He has not.


Thomas Miller Bell: On other matters, no.


Lionel Chevrier: Then why does he not answer these questions?


Thomas Miller Bell: Because they are on other items.


Lionel Chevrier: I ask the minister now what is the present position of the fund. I think the committee is entitled to know that on this item.


Donald Methuen Fleming: That information is not relevent to this item but it has been given on a number of occasions this session. The last occasion on which it was given was within the last fortnight or so.


Leon David Crestohl: I was surprised, Mr. Chairman, at your referring me to the details on page 20. Of course, the item of $1,500,000 is shown there as representing salaries and wages. That is a general statement. Surely we are entitled to know to whom these salaries and wages are being paid.


Donald Methuen Fleming: That information was all given this afternoon.


Leon David Crestohl: I do not know whether it was given or not-


Donald Methuen Fleming: Then you should have been here.


Leon David Crestohl: The minister will not sidetrack me in this way. We were told some time during the present session that about 40 additional inspectors were hired to track down those who might have drawn unemployment insurance without being entitled to do so. We want to know whether this item, this additional amount, includes provision for inspectors, investigators or detectives to track down these people. We are entitled to these details.


Donald Methuen Fleming: They were all given this afternoon in their amplitude and if the hon. member was not here at the time that is no reason why that information should

Supply-Labour
all be repeated now. I went over all these points this afternoon and they are all on record in Hansard.


Lionel Chevrier: You did not answer the questions about the fund.


Paul Theodore Hellyer: Has the extra expenditure been due perhaps to a greater level of unemployment than was anticipated, and is that the reason why administrative charges amount to more than was forecast?


Donald Methuen Fleming: I did not hear the first part of the question.


Paul Theodore Hellyer: Mr. Chairman, I will repeat the question for the minister. Is the extra expenditure due to a greater level of unemployment than he had anticipated at the time he set his original estimates?


Donald Methuen Fleming: As I pointed out, very plainly this afternoon, the bulk of this additional item is for salary, and amounts to $1.5 million. I pointed out why that was required both with respect to casual employees and enforcement officers. The figures are all on this afternoon's record.
In regard to the unemployment insurance fund, if the hon. member will take the trouble of looking at page 3006 of Hansard he will see the answer that was given as to the state of the fund as of February 28 and the holding of securities.


William Hector McMillan: The reason I asked these questions was because there was considerable variation between the report of the advisory committee and what the minister has said in the house. The advisory committee said that the market value of these bonds was between 8 and 9 per cent below par but the minister on March 15 said that the securities at par were worth $253 million and at market value, $210 million. This represents approximately 16 per cent. I would like to find out why the advisory committee says it is 8 to 9 per cent while the minister reports something like 16 per cent.


Jacques Flynn: Shall vote 699 carry?


William Hector McMillan: No, Mr. Chairman, I would like to find out what the reason is for this difference.


Donald Methuen Fleming: That has nothing whatever to do with the item under consideration. What we are concerned about in this item is the provision for salaries, travelling expenses, postage, telephones and telegrams, as we went over them this afternoon. That information is all on the record.
As to the state of the fund, there will be occasions in the course of this session when discussions of that kind will be quite in order. They will be in order at the time we are

considering the appropriate item in the main estimates for 1961-62. Some aspects of this question may relate to the bill which I indicated this government intends to introduce in due course later this session, as indicated in the speech from the throne. This kind of inquiry initiated by the hon. member for Welland is not relevant to the item now before this committee.


Paul Theodore Hellyer: Can the minister say whether the additional casual employees were required to improve the service or because of the increase in work load?


Donald Methuen Fleming: The addition results largely from an increased work load.


Lionel Chevrier: There are one or two matters I should like to bring to the minister's attention. If the minister will look at the main estimates he will see item 188.


Donald Methuen Fleming: Which year's estimates are you referring to?


Lionel Chevrier: I am looking at the estimates tabled for this year.


Donald Methuen Fleming: You refer to the estimates for 1960-61?


Lionel Chevrier: No, for 1961-62.


Donald Methuen Fleming: Those are for next year.


Lionel Chevrier: The minister will note item 188-unemployment insurance commission- $45,542,000 which appears to be the same item as this present one and would in my opinion authorize the committee to discuss under this item the same matters that would be allowed for discussion in the main estimates. That would therefore authorize the kind of question that the hon. member for Welland has in mind.
However, to come back to what the minister said concerning the details which are to be found at page 20, I see two items that indicate to me that this is a matter which can be discussed at greater length than the minister suggests. I refer to salaries and wages. This would authorize the committee to discuss the administration of the unemployment insurance committee and the unemployment insurance contributions, and would therefore allow this committee to inquire of the minister the nature of these contributions.
However, there is an item here which concerns me at the moment covering postage in the amount of $240,000. I would ask the minister whether that is exclusively for the posting of letters.


Donald Methuen Fleming: As I pointed out this afternoon, the item of $240,000 for postage is entirely due to the higher than expected claims rate.
As to the unemployment insurance contribution item in the amount of $33,000, this increase is due to the large number of casual workers who have ben engaged by the commission to look after the increased number of claimants and represents wages paid to these casual workers.


Lionel Chevrier: I am informed that the item for postage, being $240,000, would represnt the dispatch of some 6 million letters. If that is the case then what would be the total amount of letters posted in a 12-month period? This is, after all, a supplementary estimate for a short period of time.


Donald Methuen Fleming: The amount for postage provided in the main estimates is $900,000. This addition of $240,000 will bring the total outlay for postage for the fiscal year to $1,140,000.


Lionel Chevrier: It would follow from that statement that the information I have relayed to the minister, which I believe to be accurate, would indicate the dispatch of some 6 million letters, which is a tremendous volume. I should like to know whether or not that information is accurate?


Donald Methuen Fleming: If the hon. member is speculating about the number of letters that have gone out, I will question his figure. However, I am trying to do something a little better than that by giving him a more precise figure as to the volume of mail.


Lionel Chevrier: I thank the minister. I was not speculating, but asking for information as-and the minister knows this-I have a perfect right to. If I am mistaken as to the 6 million figure I should like to be corrected.


Leon David Crestohl: Could the minister inform the committee in regard to this new group of inspectors or investigators, which the minister has been talking about and for whom he is now requesting this additional money, what is anticipated in the way of recovery for the unemployment insurance fund from those who are accused of having pilfered the fund by making claims to which they were not entitled? Is there any anticipation of prosecutions, and recovery by way of penalties, of those people who have received unemployment insurance when not entitled to it?


Donald Methuen Fleming: It is very difficult to give even an approximate estimate as to anticipated recoveries because this raises the question, in every case, as to whether the amount is recoverable, having regard to the means and position of the person who has 90205-6-217
Supply-Labour
improperly collected the insurance. However, as to the prosecutions, I might say that during this present fiscal year there has been a substantial increase in the number. In the fiscal year 1959-60 the number of claimants prosecuted was 1,341. I am informed that in the present fiscal year, which has not yet ended, the number of prosecutions will probably reach 1,800.


Leon David Crestohl: I should like to draw the minister's attention to an actual case with which I am familiar. A person in Montreal was summoned and charged with overdrawing his unemployment insurance to the extent of $103. Of course, we certainly do not condone that. He went to the office of the unemployment insurance commission and admitted that he had overdrawn this amount and offered to pay it back. He said, "I have a job now and I will repay this amount on the instalment plan". He was told that they could not take it from him in that way. They said, "We will have to lay a complaint before the courts", which is quite proper.
A complaint was laid and he pleaded guilty. He was informed that his penalty was a sum calculated on the number of offences he was supposed to have committed with respect to the withdrawals he made. The penalty was fixed by the court at about the same amount, $103, and costs, which together came to $110. The sum of $110 was paid into court. This man was under the impression that that was the end of his offence and the penalty. He is now faced with a civil claim for the recovery of the amount.
I do not say there is anything improper in this. It is perfectly proper and perfectly within the law; but I point out to the minister the hardships which are sometimes inflicted on those unfortunate people who have to struggle in their new jobs to pay their penalties. This is a double penalty. Again I emphasize that I do not condone what was done and I do not suggest that it should be forgiven, but when the man appeared and offered to repay the amount he was faced with a second penalty.
If the money which is now being requested in this item is being used for the hiring of inspectors to track down these things, then perhaps there is a certain amount of recovery. Perhaps the minister will inform the committee that that is the approach and there is expected by way of recovery at least enough to pay these expenses which otherwise become a very costly operation on the government.


Jean-Paul Deschatelets: I have only one question. We are dealing with the unemployment insurance commission. Will the minister give

Supply-Legislation
us the latest figures of the number of people drawing benefits from the unemployment insurance fund?


Donald Methuen Fleming: Mr. Chairman, in reply to the question asked earlier by the hon. member for Laurier, I am told that there is no precise figure available as to the number of pieces of mail that go out from the commission, but the figure which I gave earlier, which indicates an increase in the postage outlay of the commission, is attributable to the higher volume of claims and to some extent to a centralization of the adjudication of claims at regional points, necessitating the mailing of claimants' documents to central points.
The figure of unplaced applicants at March 16 was 873,092, which was a slight reduction from the previous week.


Jean-Paul Deschatelets: Do I understand that this figure represents the number of people drawing benefits from the unemployment insurance fund?


Donald Methuen Fleming: No, this is the figure of unplaced applicants.


Jean-Paul Deschatelets: What I am asking for now is the latest figure of the number of people drawing benefits.


Donald Methuen Fleming: I am told that the latest figure is one which appears in Hansard, one which was given recently by my colleague the Minister of Labour. That is the most recent figure.


Jean-Paul Deschatelets: Will the minister repeat the figure?


Donald Methuen Fleming: I have not the Hansard reference, but I am told by my advisers that that figure was given recently in the house by the minister and it is the latest figure available. The January figure was 846,940 active claimants; that is, at the last day of January.


[Stage Direction]
Item agreed to.

[Stage Direction]
The Senate-
700. General administration-further amount required and to authorize, notwithstanding the Civil Service Act, an honorarium in the amount of $1,000 to Dr. R. Warren James, for services rendered by him to the Senate special committee on manpower and unemployment, $27,200.
Herbert Wilfred Herridge: This vote has to do with general administration of the Senate. One rather intriguing item in the details on page 20 reads:
Carriage of mails between postal terminal and Senate: session, $5 per diem; recess, $50 per month, $200.

Will the minister inform the committee where this postal terminal is, and will he give us an idea of this arrangement?


Donald Methuen Fleming: This amount of $200 relates to a trucking service operated at a cost of $50 per month during the recess and $5 per day during the session. The need for the provision of this sum is due to the extended period of employment at the higher rate during the present fiscal year.


Herbert Wilfred Herridge: What I am interested in is why this is necessary on the Senate side of the post office when there is no item like it for the House of Commons.


Donald Methuen Fleming: No; it is the carriage of mail between the postal terminal and the Senate. In other words, this is for bringing the mail from the postal terminal to the Senate post office downstairs.


Herbert Wilfred Herridge: I have never seen a comparable item for bringing the mail from the postal terminal to the House of Commons side of the post office. Why is that?


Donald Methuen Fleming: The House of
Commons is the owner of two trucks, one in good shape and one in very poor shape.


Herbert Wilfred Herridge: The House of Commons does its own work through its own employees who carry the mail. In the other case other arrangements are made. This seems rather a peculiar thing to me.
Mr. Pallet!: The House of Commons always carries the mail, anyway.


Herbert Wilfred Herridge: Why is it necessary to have two methods of transporting mail from the postal terminal to the house, one for the Senate and one for the House of Commons? Why can one vehicle not do both?


Donald Methuen Fleming: The hon. member is aware that both houses of this parliament are very jealous of their independence of one another. They have largely separate services in this building. The post offices of the two houses are separate, at least in the sense that they are set apart one from the other and, as the hon. member is aware, there are other services that the two houses choose to operate independently of one another. There is a measure of co-operation, of course, but I do not think the hon. member would wish this house to sacrifice to another place any of its independence with respect to its own services and I dare say the feeling in another place is somewhat similar as to its services.


Herbert Wilfred Herridge: I just want to say that I
cannot see why the senators would lose any dignity by having their mail bags put in the House of Commons truck instead of having

two vehicles doing work that one vehicle can do and causing unnecessary expense.


[Stage Direction]
Item agreed to.
DEPARTMENT OF MINES AND TECHNICAL SURVEYS General-
704.	Polar continental shelf project-further amount required, $89,940.
Herbert Wilfred Herridge: Would the minister explain the purpose of this item, polar continental shelf project, $89,940? Is this another form of winter works program?


Donald Methuen Fleming: No, Mr. Chairman, although part of the operation that is here provided for is carried on under Arctic conditions. This is an additional provision to enable the field program of the Department of Mines and Technical Surveys to be carried forward in relation to the polar continental shelf project. This project has been described in the house on earlier occasions and is, I am sure, well known to hon. members. The principal element in the figure of $89,940 is an item of $78,381 for materials and supplies. This additional amount is required for aviation gas and oil, totalling $72,000, and for camp and field supplies including fresh provisions which will be transported to the Arctic in this present month. There is an additional item of $10,959 for the charter of aircraft and the rental of equipment and there is a small item of $600 for the purchase of field notebooks and a typewriter for field use.


Lionel Chevrier: Mr. Chairman, I should like to discuss this matter and raise some questions about the manner in which the contract for the helicopter part of the polar continental shelf project was given. I state that it was given without the calling of tenders and it was given to the same person who received it last year although it was brought to the minister's attention that that too had been done without tender.
It has been the practice in most departments, I believe, to call for tenders on work of this nature, particularly when it is done by means of the filing of tariffs with the air transport board. In this case the minister, for some unknown reason, decided not to call for tenders, as I will indicate in a moment, and simply awarded the contract on the basis of information obtained through the filing of tariff rates. On March 8, 1961, I asked the following questions of the Minister of Mines and Technical Surveys, as found on page 2774 of Hansard:
1. Did Autair Helicopter Services Limited obtain a contract or contracts from the Department of Mines and Technical Surveys for the continental polar shelf project and for topographical work in 1960?
90205-6-217^
Supply-Mines and Technical Surveys
The minister replied as follows:
The answer to part No. 1 is that Autair were awarded one contract for helicopter services required on the polar continental shelf project in
1960.
Then I asked what was the amount of such contract and the minister's answer was "$183,500". I also asked the following question:
How much was paid to Autair Helicopter Services Limited in 1960?
The answer was "$137,551.36". Then I asked the following question:
Has Autair Helicopter Services Limited a contract or contracts from the Department of Mines and Technical Surveys for the continental polar shelf project for 1961?
The answer was:
The answer to part No. 1 is no. A letter of intent was, however, sent to Autair on February 23,
1961,	pending, and subject to, final consideration by the treasury board who, on March 2, 1961, approved our proposal.
Therefore the answer to that question was in the affirmative, namely, that there was a contract awarded to this company. The second question was the following:
If so, were tenders called, and who were the other tenderers?
This was the answer:
-we do not call tenders in those cases where rates are filed with the air transport board. We do, however, review the rates of all companies considered capable of performing the service before making our selection.
Here is my criticism of the manner in which this is being done, and I say this without any fear of contradiction. The minister may contradict it but I have it on reliable information. It is well known in the trade that, notwithstanding the fact that tariffs had been filed, Autair was not the lowest of those who filed tariffs in accordance with this policy of the minister which merits only condemnation. Autair filed a tariff afterwards which was lower than those that had been filed by the other applicants and in that fashion the contract was awarded to them.


Thomas Miller Bell: Should the hon. gentleman not read the answer to part 3?


Lionel Chevrier: I will come to that in a moment and to a further question. I am complaining at the moment about the manner in which these contracts are awarded for the work on the continental polar shelf. Contracts for helicopter services elsewhere are not awarded in this manner. The third question, with respect to which the parliamentary secretary wishes me to deal, was the following:
Did Autair submit the lowest tender?
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Supply-Mines and Technical Surveys
The minister answered as follows:
The answer to part 3 is that an economic assessment of the applicable air transport board rates and associated costs made by my department indicates that the services of Autair would result in the lowest over-all cost to the government of Canada.
That is not a statement that they were the lowest. It simply says that an examination indicates that the services of Autair in the result would be the lowest. It seems to me that is not the manner in which to award contracts. Rather it should be done on the basis of open, public tenders with the contract being awarded to the lowest tenderer. In this case the contract did not go to the lowest tenderer because Autair was given the opportunity to submit a lower tariff rate after all the applicants had submitted their tariff rates.
I submitted a third question on March 15, 1961, as found on page 3006 of Hansard. It reads as follows:
What equipment is required of a contractor to perform the helicopter services on both the continental polar shelf and the topographical survey?
This was the answer:
For 1961 operations we require the contractor to supply: 4 Sikorsky S-55 helicopters equipped with float landing gear; 1 Sikorsky S-55 helicopter equipped with wheel landing gear; 1 Bell 47 G2A helicopter equipped with skid and float landing gear.
In addition, the following are required on all aircraft: (a) H. F. radio transceiver (b) V. H. F. radio transceiver (c) radio compass (d) gyro compass (e) cabin heater (f) engine heater and (g) engine and nose bubble covers and tie down equipment. Major and minor spare parts must also be readily available.
2. Autair Helicopter Services Ltd., report that on March 8, 1961, it had in its possession one Bell 47 G2A and four Sikorsky S-55 helicopters, and arrangements have been made for the fifth Sikorsky S-55. The necessary items of equipment required by the department are also reported to be available.
That information is false. That information was not true. That information is inaccurate and the minister got around it by saying that Autair Helicopter Service reported they had the following equipment. They did not have the following equipment, and that is well known to the trade. Whether or not they have it now, I doubt very much. I do know one thing, that one of the main things required of the person obtaining the contract for the polar shelf job was that the Bell 47 G2A helicopter should be equipped with a skid and float landing gear. Autair did not have it. I am mistaken, Autair had it but it did not belong to them. Autair borrowed it from one of the members of the trade and refused to give it back. One of the members of the trade has had to sue Autair in the courts of the province of Ontario for the return of this equipment; that is a matter of public record.


This company is not a reputable company and should not be in receipt of this contract.
I indicated last year, and I repeat now, that this company operated without a licence for several months in 1958. Furthermore, this company had its insurance cancelled twice by a reputable insurance company and is not a reliable helicopter operator. More than that, this company said it did not give a damn for the air transport board.
Last year when I brought up the question, the company refused to file a financial statement with the air transport board in accordance with the Aeronautics Act. The information I have now is that they still have not done so. In the far north, where it is extremely important that persons should be transported with safety, why is it not necessary and of prime importance that the requirements of the Aeronautics Act should be complied with? The information I have is that the requirements of the Aeronautics Act have not been complied with. Certainly, the requirements laid down by the minister in answer to the questions which I have put to him have not been complied with in so far as equipment is concerned.
I have a perfect right, therefore, to ask the government why this contract should not be reviewed and why it should not have gone to the person or corporation that submitted the lowest rate in the first instance.


Donald Methuen Fleming: The fact is that the contract did go to the corporation that submitted the lowest tender. The hon. member has chosen to make a vitriolic attack, and he has chosen to make assertions here. Well, I suppose a member enjoying the privileges of this house can make assertions of that kind and reflect upon the integrity of a firm outside the house. However, Mr. Chairman, it is not a good way for parliamentary business to be transacted if hon. members get up and make assertions such as those which have been made tonight.
In the first place, there were three bidders for this work in 1960. The contract was awarded to the Autair company which was the lowest of the bidders. All of the bidders filed tariffs, so that the rates are known. So far as this year is concerned, there were five bidders and again, Mr. Chairman, their tariffs were filed. Again it was found that Autair was the lowest and the contract was awarded to Autair. In so far as any bidder being permitted to refile a tariff is concerned, all of the bidders were permitted to refile tariffs, so the treatment was equal in all cases.
So far as this company is concerned, it has fully discharged its obligations under the contract and has a satisfactory record of per-

formance under the contract. The law will be observed and nothing less than the law will be accepted in the discharge of the company's obligations. I think, Mr. Chairman, in the face of these facts the public interest is fully protected, except against vitriolic attacks of the kind the committee has listened to tonight.


Lionel Chevrier: The minister has said I have made a vitriolic attack against this company. Will the minister disprove any of the statements I have made? I have made charges in this house in the same way that I made them last year. Nobody rose to dispute them. My statement last year that this company had operated without a licence was admitted by the Minister of Transport. He said he had overlooked it and he passed an order in council by virtue of certain decontrol powers which put this company in a position to operate. I also made a statement that the company's insurance had been cancelled twice and I named the company that had cancelled the insurance. It was the British Aviation Insurance of Montreal. This statement has not been disputed. I also made the statement that this company had not filed a financial statement as it is required to do under the Aeronautics Act.
If these statements are not correct, let the minister or anybody else on the other side disprove them. I am not in the habit of making statements on my responsibility as a member of parliament that I cannot substantiate. If I make statements that are incorrect or inaccurate I will rise in my place afterwards, as I have done on one occasion, and say that I was in error. I have made these statements based upon information which I have received from extremely reliable sources. One of these statements which I have made this evening indicates that, notwithstanding what the minister has said was required in so far as equipment to operate in the far north is concerned, Autair did not possess. Furthermore, Autair is being sued in a court of law for the return of certain equipment that is required, according to the minister himself, for operation in the far north. Surely, that ought to be enough to put the minister and the government on the defensive and to urge them to inquire fully into this matter.


Donald Methuen Fleming: The hon. member has chosen to repeat something he said last year about this company in relation to its licence. The air transport board is quite capable of dealing with this situation. The air transport board is the body with which this company has filed its tariff, and this company must be licensed. The hon. member keeps on speaking of what happened last
Supply-Mines and Technical Surveys year as though it were a continuing situation. He talks about an action in the courts against the company. It is not customary, Mr. Chairman, to assume that a company that is being sued and, as I gather, defending an action, is at fault until that has been determined by a judgment of a court of law.
I suggest to the hon. member that talk of this kind is the sort of thing that should be put forward in quite different circumstances if he feels that, on his responsibility as a member, he should undertake to do so.
The hon. member has mixed up, along with statements made in a government return, a large number of statements that he himself has made. I respectfully suggest to him, Mr. Chairman, that he has not correctly interpreted the answers that were made by my colleague the Minister of Mines and Technical Surveys. I repeat-and in this respect I find myself in contradiction of the hon. gentleman's earlier assertions-that in each year this company was the lowest bidder and that the government in awarding the contract to Autair was serving the public interest and getting the most economical job done in relation to this polar continental shelf project; and in that respect I suggest that my colleague the Minister of Mines and Technical Surveys was carrying out his duties.
So far as an action in the courts is concerned, I take it that we may await the outcome of that matter instead of trying to prejudge it. So far as licensing last year is concerned, that gave the hon. gentleman no right to make continuing accusations as to a later period. I have said that this company must obey the law. Nothing less than obedience to the law will be accepted in satisfaction of the company's obligations.


Lionel Chevrier: On that point, Mr. Chairman, may I say that the company has said positively that it would not obey the law last year and there is indication-and I think it is my duty to bring it to the attention of the government-that the company has no intention of respecting the law again in 1961. I refer to the law as laid down under the Aeronautics Act in so far as the filing of a financial statement is concerned.
Then the minister said, "Here I rely on the answers which were given by my colleague the Minister of Mines and Technical Surveys". The Minister of Mines and Technical Surveys says that he gives this tender out on proposals and not on bids. I condemn that practice. I say that is not the proper way in which to do it. If there were bids, I would not be here condemning the situation. There were no bids. There was a filing of tariffs and the man who was not the low man was allowed to retender. That was why I enter
3440	HOUSE OF
Supply-Mines and Technical Surveys a caveat. That is why I say that the policy is bad and should not be condoned.


Donald Methuen Fleming: Mr. Chairman, let us not have any misunderstanding about this matter of bids. The filing of a tariff is an offer; it is a bid. In this particular case the tariffs of all these companies were known; and it was found on examination, as I indicated last year, that on the basis of the tariffs filed, Autair was the lowest. Again this year, of five companies whose tariffs were known or were published, Autair was the lowest. I repeat that when the hon. member talks about Autair being permitted to refile a tariff-[DOT]


Lionel Chevrier: Re-enter a bid or re-enter a tariff.


Donald Methuen Fleming: -that was done by all of the five companies.


Lionel Chevrier: No; it was not.


Donald Methuen Fleming: It was not peculiar to Autair.


Lionel Chevrier: It was.


Donald Methuen Fleming: The hon. gentleman makes that statement. I am going by information which I have received from my advisers and I believe it to be correct information. The hon. gentleman speaks with great confidence in making his assertions. How can he pretend to say that the department did not have regard to five tariffs filed by as many respective companies? I think the hon. member is taking a great deal on himself.


Lionel Chevrier: No, I am not taking a great deal upon myself; and I do not like the minister instructing me as to what is the meaning of the filing of tariffs. I know full well what is the meaning of tariffs. It seems to me that the proper way in which to have proceeded was not by way of a filing of tariffs but by way of open tenders. That is what I am complaining about. This position I am now complaining about would not have arisen if the system of open bids had been followed, of which system I am sure the minister approves in all other cases.
Why are tariffs filed? Tariffs are filed in order to give the department a too wide opportunity to select one rather than the other. If you look at the answer which the minister gave and which the parliamentary assistant insisted that I repeat, it would indicate quite clearly that there was a reason for this. It reads as follows:
The answer to part 3 that an economic assessment of the applicable air transport board rates and associated costs made by my department indicates that the services of Autair would result in the lowest over-all cost to the government of Canada.


It does not state that it is the lowest. Hence the statement the minister has just made is not accurate. It was not the result of the rates that indicated who was the lowest. It is rather the study or the "economic assessment" of the board rates and associated costs "made by the department". The minister asks me to say that the officers were in error. Of course I am not going to say that the officers were in error. How can I say that? However, I can say this from information I have in my possession. Those who did tender were not given the same advantages in the consideration of the economic assessment of the applicable air transport board rates and associated costs as was Autair. This seems to me to be a very roundabout way in which to grant a contract of this importance and of this nature. I am repeating now that the method is not the right one. Certainly it is not the method that the Minister of Finance advises his colleagues in other departments to use when large and substantial sums of money are spent by the treasury. I am sure he suggests to them in all cases, except in very extraordinary circumstances, that the contract should go not by the filing of tariffs but by bids to the lowest tenderer.


Donald Methuen Fleming: Mr. Chairman, the tender system is well established in government practice and there will be no weakening of that principle, I can assure the committee. But in the case of transportation services, as the hon. member well knows from his experience, the established custom is to file tariffs. We have it done on the part of railways. In some jurisdictions we have it done on the part of trucking services. In the case of aeronautic services we have it done with the air transport board. I must say to the hon. member that he is drawing a long bow in trying to set my statement at odds with that of my colleague as reported at page 2774 of Hansard. They are the same statements. His answer was:
The answer to part 3 is that an economic assessment of the applicable air transport board rates and associated costs-
And so on. As to the applicable air transport rates, that expression signifies the tariffs filed by these companies with the air transport board. It was following a review of these published tariffs that the department decided that the most economical service to be obtained in relation to this project was that of Autair. That statement is not controverted here tonight.


Lionel Chevrier: I say it is.


Some hon. Members:: Carried.


William Moore Benidickson: Can the Minister of
Finance, in the absence of the Minister of

Mines and Technical Surveys who is principally concerned, indicate to the committee the grade of tariff filing that would be applicable to this particular contract?
The minister, is, I think, aware that there are tariffs which are based on scheduled services and tariffs based on non-scheduled services. They fall into classes (a), (b), (c) and (d). In connection with this particular contract, under what tariff rating in accordance with the air transport board regulations would these tariffs have been filed?


Donald Methuen Fleming: I cannot give the particular designation but it is not one applied to a regular route.


William Moore Benidickson: No. That illustrates the necessity of having the minister principally concerned present before the committee, because I am confident that within the last ten days I have read an amendment to the air transport board rules under which henceforth a grade such as, for example, grade 4, will not be permitted to file a tariff and operate under that tariff in advance of permission being given by the air transport board. I presume that perhaps under this contract a tariff has been filed which has never received public adjudication in the face of competitive representation before the air transport board. There are certain grades of air operation which can simply file a tariff, and that tariff prevails until the board adjudicates to the contrary. That is the reason I raise this question-in what grade of aviation operation is this contract to be considered?


[Stage Direction]
Item agreed to.
B-Dominion coal board-
705.	Payments in connection with the movements
of coal under conditions prescribed by the governor in	council-further	amount required.
Paul Theodore Hellyer: I wonder if the minister would say whether this vote includes any funds for the storage of coal.


Donald Methuen Fleming: Not the storage, Mr. Chairman.


Paul Theodore Hellyer: It is for transportation only, not including storage?


Donald Methuen Fleming: That is correct.


[Stage Direction]
Item agreed to.

[Stage Direction]
Royal Canadian Navy-
706.	Operation and maintenance-further amount required, $1,000,000.
Paul Theodore Hellyer: I wonder if the minister could say whether this additional amount required is entirely due to the increase in rates of pay?
Supply-National Defence


Donald Methuen Fleming: Yes. This item arises entirely from a general salary revision granted to classified civilian employees of the Royal Canadian Navy.


[Stage Direction]
Item agreed to.
Royal Canadian Air Force-
707.	Construction or acquisition of buildings, works, land and major equipment-further amount required, $10,000,000.
Paul Theodore Hellyer: I wonder if the minister will say for which engines and which aircraft additional funds are required?


Donald Methuen Fleming: First, it will be understood that in this large item-the item in the main estimates was $228,192,000- it was found at the end of the year that some parts of it were inadequate and in other cases that the full amount appropriated will not be required. This is a case of putting together the pluses and the minuses and arriving at a net result. However, the deficiencies were in relation to the CF-104, the C-130B, the CC-109, and the Caribou.


Paul Theodore Hellyer: The minister mentioned three aircraft on which expenditures were being made, but he did not mention the engines. Can he tell us whether provision for engines is included in this amount?


Donald Methuen Fleming: I am sorry, but I found it difficult to hear all the hon. member's question. Is he asking me what engines are incorporated in these respective aricraft?


Paul Theodore Hellyer: No, Mr. Chairman. The details of this item refer to aircraft and engines. I wonder if the minister would indicate which engines are referred to?


Donald Methuen Fleming: The engines referred to in that expression are those of the aircraft I have just mentioned.


Paul Theodore Hellyer: Just before this item carries I should like to reiterate the feeling of this side of the committee with respect to the CF-104 and its engine and to say we believe this is a rough engine being installed in a poor aircraft to carry out a questionable role to which we should not have committed ourselves in the first place.


Donald Methuen Fleming: Every one of those assertions was completely controverted last year by the Minister of National Defence.


[Stage Direction]
Item agreed to.
Mutual aid-
708.	Contributions to infrastructure and military costs of the North Atlantic Treaty Organization- further amount required, $740,000.
Douglas Mason Fisher: Several years ago I discovered that all the bids that are put up for contracts within the infrastructure are on a partnership

Supply-National Defence basis, that is, the fact that some of the contracts may go to supply Canadian troops is no advantage to Canadian suppliers who are bidding. As I understood at the time, no Canadian bidders have ever been successful in obtaining any large contracts within the infrastructure organization.
I wonder if the minister could tell us whether in the past year Canadian contractors have had any more success in bidding for NATO infrastructure contracts?


Donald Methuen Fleming: I am informed that no Canadian contractor has participated yet in any of the infrastructure contracts. Of course, a Canadian firm has been successful in the provision of simulators, but the information I have been given with respect to the infrastructure indicates that no Canadian contractor has yet succeeded in that field.


Douglas Mason Fisher: Can the minister give the committee a rough indication of how much has been involved in the last year in these particular contracts in respect of which Canadians have not made any bids or have not been successful bidders?


Donald Methuen Fleming: I do not have the total of the entire NATO infrastructure outlay here, but it would be a substantial sum.


Herbert Wilfred Herridge: Could the minister give us some idea of what is included in this term "infrastructure"? I have a general idea, but can the hon. gentleman say just what is meant by the word?


Donald Methuen Fleming: "Infrastructure" is an expression which has come into well-established use within the last decade. As a matter of fact, I think it was NATO itself which introduced this expression. It applies to permanent installations, the fixed installations. It would apply to airports and to buildings; to anything of a permanent or semi-permanent nature which is a fixed installation.


Paul Theodore Hellyer: I wonder if the minister would indicate why the Canadian percentage of infrastructure expenditure is being reduced compared with that previously in effect?


Donald Methuen Fleming: Because the humble representative of the Canadian government on the committee insisted that Canada was being assessed more than her share. There was a general revision of assessments having regard to the fact that some of the European allies had their percentages struck at a time when they were not as strong economically as they have become. In the revision of the assessments the two North American allies were granted a reduction in their percentages, and some of the European countries accepted


an increase in their percentages. Germany accepted the largest increase.


Paul Theodore Hellyer: The minister is saying that Canada's economic position has declined relatively in the last two or three years, and that is the reason for it.


Donald Methuen Fleming: Not at all. The fact is that the two North American allies were called upon in earlier years to contribute a share to the NATO budget for its infrastructure which took into account the fact that at that time the economies of the principal European partners were not nearly as strong as they are today. With the increase in economic strength of those countries there is no reason why they should not accept a larger share of the burden, and they have done so, notably Germany. Its increase has been substantial. Who should benefit by Germany's increase as among the other countries? The two countries on this continent that had accepted a disproportionately heavy assessment at the outset naturally felt that they could expect a more proportionate share than they had borne up to this time.


Paul Theodore Hellyer: I am not a lawyer but it seems to me that when the European countries' economies have strengthened the converse would be that Canada has not been able to keep up.


Donald Methuen Fleming: That is an absurd conclusion. We are speaking in relative terms here. The fact is, and I make no apology for the part I played in relation to this in bringing about the reduction in Canada's contribution, that if a million dollars a year can be saved the Canadian taxpayer, we shall make no apology for the saving.


Paul Theodore Hellyer: You are indeed responsible for saving the taxpayers' money in this country.


Lester Bowles Pearson: Is the minister telling us that he has saved a million dollars out of the infrastructure as reflected in the supplementary estimate?


Donald Methuen Fleming: What I indicated was that the reduction in Canada's share of the budget will amount to approximately that figure. There was some extended discussion as to the extent of reduction in the United States percentage and the extent of the Canadian reduction. The situation is that Canada's-I do not recall the precise fractions now-percentage came down approximately 1 per cent of the total NATO infrastructure budget.


Lester Bowles Pearson: As a result of the minister's efforts he is now saying that our contribution

to the infrastructure has been reduced about $1 million. Does he refer to the infrastructure alone in this regard?


Donald Methuen Fleming: Yes, in this coming fiscal year.


Lester Bowles Pearson: Would the minister tell the committee what is involved in the other part of this item, the NATO military budgets? What are the other military budgets involved in this item?


Donald Methuen Fleming: The additional
payment to the military budget is $580,000.


Lester Bowles Pearson: I may be wrong, but the figures I have here at page 22 of the supplementary estimates show that our contribution to infrastructure and NATO military budgets totals $540,000. The minister has now stated that the total contribution to the NATO military budgets is over $500,000. There must be some mistake there.


Donald Methuen Fleming: Mr. Chairman,
here are the figures in detail: the expenditures to February 21, 1961 on account of military budgets amount to $13,656,000, leaving an unspent balance of $844,000. With current requests of $1,384,000, there is a further requirement of $540,000. The $740,000 is made up by two additions required. The first is direct procurement, $200,000; the second is the NATO budget, $540,000, totalling $740,000.
The figure that I gave earlier of $1,384,000 is made up of three items. The first, contribution to SHAPE for forward scatter system- $380,000; the second, additional payment to the military budget-$580,000; the third is the first quarterly instalment of the adjustment in the contribution to infrastructure-$424,000, making the total of $1,384,000.


Lester Bowles Pearson: I wonder whether the minister could tell us what form this procurement for mutual aid takes which amounts to $200,000? I understand this is a supplementary figure. Could he give us the total figure for procurement for mutual aid for NATO this year and indicate what is involved in that procurement. How much of it, if any, is the transfer of military equipment, and how much is for the purchase of new equipment for the NATO forces?


Donald Methuen Fleming: So far as Canada's share is concerned, the main budget contained a figure of $300,000 for direct procurement, and to that it is now proposed to add $200,000 making a total requirement in respect of direct procurement of $500,000.


Lester Bowles Pearson: Does that mean that our mutual aid contribution to NATO this year will be half a million dollars for direct procurement?
90205-6-218
Supply-National Defence


Donald Methuen Fleming: Yes.


Lester Bowles Pearson: Could the minister give any indication of what is covered by this item for direct procurement? What are the items of equipment involved?


Donald Methuen Fleming: Perhaps I can provide that answer later.


Lester Bowles Pearson: I can understand the difficulties involved in getting the details, and perhaps the minister will procure this information for us later. Could the minister now compare this amount of half a million dollars for mutual aid direct procurement with what it was five years ago?


Donald Methuen Fleming: I will be glad to secure that information and communicate it to the hon. gentleman.


William Moore Benidickson: Could we leave this item open?


Hazen Robert Argue: Mr. Chairman, I would like to say a few words regarding this item on behalf of the C.C.F. new party group in the committee, and as the national leader of the C.C.F. movement.
NATO has had a long and memorable history and we believe, has in the past been an important force in the stabilization of world conditions. We do think that world conditions are changing and that in these changing world conditions we should re-assess our position in NATO. Europe is stabilized, and the nations of Europe have made a very excellent economic recovery. It has been the policy of the C.C.F. party, and the policy of the Canadian government to this date-but government policy now seems to be shifting as far as Canada is concerned- to prohibit atomic weapons on Canadian soil.
The Co-operative Commonwealth Federation has gone further in this regard. We have a definite policy not only of opposing the spread of atomic weapons to Canadian soil, and to other nations but being placed in the hands of Canadian troops anywhere in the world. Therefore we oppose, and will continue to oppose in the future, any move to provide atomic weapons in general to NATO forces. We are fully aware that certain NATO powers have atomic weapons and that atomic weapons are under the control of the United States commander in Europe. This is a further reason why we think our role in NATO should come under review at this time.
If one makes the assumption, which I do not think is an accurate one, that NATO has only conventional weapons, that NATO is merely a force which has the use of conventional weapons, then it also can be questioned on this ground as to what military contribution our small conventional force

Supply-National Defence attached to NATO in fact makes, and whether, if we should withdraw this small force, it would have any material effect on the military position of the NATO countries.
One of the main reasons why the former national leader of the C.C.F., Mr. M. J. Coldwell, and the members around him in the house at that time, including myself, supported NATO and supported it in subsequent years, was that we felt that article 2, under which there was to be economic assistance and economic aid to other countries, would be implemented. As a matter of fact' we have now come to the conclusion that article 2 of the NATO treaty was little more than a sop to those people who believed that economic aid within NATO should be promoted. It has been demonstrated beyond any shadow of doubt that article 2 within NATO is dead.
One needs only to refer to the necessity of setting up the O.E.C.D. which we in the C.C.F-New Party group in the house were very pleased to support. We feel that so far as economic assistance and economic stability are concerned the O.E.C.D. is in a better position to bring this about successfully than was NATO because there are a larger number of nations involved and because other nations such as Finland and Yugoslavia, we understand, are prepared to associate themselves at least to some extent with O.E.C.D. We are encouraged that President Kennedy of the United States made it clear the other day that there will be very definite changes in the United States long term foreign aid program, and that part of this foreign aid program would be channelled through the O.E.C.D. We think that all of these things suggest that NATO is becoming more and more clearly a military force and nothing else.
We are not neutralists; we are not pacifists. We take our position with the democratic and the free nations of the world, but we do question whether the expenditures that we make through NATO are the most effective means of playing our responsible part in providing a measure of stability in
. in suPPorting free institutions and the United Nations.
We think that in this day and age and at this time Canada would be better advised to dissociate herself from regional military alliances, improve her conventional force at home, make that conventional force at home strong and mobile and, as a matter of national policy, make our forces available to the United Nations for police work at any time. Let us not be in the position in which we found ourselves not so many months ago when Canada was asked for some 200 technical personnel for assistance in the Congo.

It took us a very long time to gather this technical force together. We think that greater emphasis on such a force at home in readiness for use by the United Nations would be the best role for Canada to play at this time.
To make the position of the C.C.F. party clear to hon. members I should like to quote a resolution passed at our last national convention held at Regina in August 1960. It reads as follows:
We believe that Canada must at all times give vigorous support to the United Nations, and constantly promote the strengthening of the authority of the United Nations. Our objective should be to make the United Nations eventually into an effective world government with sovereignty over all international affairs. The actions of the United Nations in the Suez crisis and now in the Congo point up the role which it can play to preserve the peace. That role must be strengthened, particularly in the fields of international economic aid and world disarmament. Since NATO has become a purely military organization, Canada should immediately withdraw from NATO in favour of promoting peaceful economic and cultural activities through the agencies of the United Nations.
Therefore, Mr. Chairman, in keeping with the policy statement that I have just outlined and believing that Canada can play its most constructive role in promoting the peace of the world, in bringing about stability and in encouraging the growth and strength of free institutions by strong conventional forces at home, we feel that the large sum of money now spent on NATO could better be spent on conventional forces at home and in providing economic assistance to underdeveloped countries.
The other day figures were brought down in the house in answer to a question of mine which showed, as recorded at page 2994 of Hansard, that the estimated direct costs of Canadian forces committed to NATO in 1961-62 would be $455,545,000, or an increase of some $47 million over the present fiscal year. Therefore, Mr. Chairman, I should like to move that item No. 708 be reduced to $1.


Donald Methuen Fleming: Mr. Chairman, I think it is well that the attitude of the C.C.F. or New Party in relation to NATO should be thus exposed to public view.
First of all, let us think for a moment what the amendment means in proposing that the item be reduced to $1. It means that Canada would now be called upon to make a default under its NATO obligations, obligations solemnly and faithfully undertaken, and Canada, a country with a proud record in the fulfilment of its obligations honourably entered into, would now be invited to become a defaulter. I do not think that will commend itself to the Canadian sense of honour, in the first place.

Now, let us look a little further. The position that has been taken by the hon. member for Assiniboia, presumably the official position of the C.C.F. and New Party, is that-


Hazen Robert Argue: Quite correct.


Donald Methuen Fleming: -Canada should now withdraw from NATO. Let me ask the committee to consider one or two facts in this regard. First, think of what Europe was like, and think of the position of the free world before NATO. I saw a good deal of western Europe and most of the countries there just before the North Atlantic Treaty was entered into. For Canada's part in the writing of that treaty I think all must take satisfaction, and for the part that Mr. St. Laurent played in that we give him full credit. It was an honourable page in Canada's history.


Paul Theodore Hellyer: And the Leader of the Opposition. Do not overlook his part.


Donald Methuen Fleming: May I continue? It will not be necessary to offer these coaching suggestions. I know something as well of the part which the present Leader of the Opposition played in bringing about the North Atlantic alliance, and all of us on this side of the house give him full credit for the part he played in the Canadian role in that alliance.
What was the situation then, Mr. Chairman? The fact is that until the alliance welded together the countries of western Europe to face the power of an aggressive communist bloc there had been no front presented to the westward march of the iron curtain and one country after another had fallen behind the iron curtain and had been reduced to the role of a satellite of the U.S.S.R. It was to erect an effective barrier against the westward march of the iron curtain that the North Atlantic alliance was brought into being.
Has NATO fulfilled its hopes? Yes, Mr. Chairman. It may not have fulfilled them all. NATO is not a perfect instrument. It is a man-made instrument and it has human imperfections and plenty of them. But the fact is that NATO has rendered to the free western world an inestimable benefit. Had it not been for the NATO alliance the history of the world in the past 12 years might have been very different.
You do not bring about great results such as have been achieved under NATO without sacrifice and without cost, and Canada's participation in NATO has not been without sacrifice or without cost on her part. But whatever part Canada has played, and it has been an honourable one, in bearing the cost and the sacrifice has been our contribution to the preservation of freedom in the western 90205-6-218i
Supply-National Defence world. It was not simply a case of preserving our own hides as a nation. It was a case of making our contribution as an important nation in the free world to the preservation of the freedom of the west because we had seen that countries, if they chose to remain divided, could expect to fall one by one like ripe plums into the U.S.S.R. basket. So let us be under no illusions about the effective role that NATO has played in the preservation of the freedom of the west.
It is all very well, Mr. Chairman, to talk about the failure to implement article 2 of the NATO treaty. It is quite true that this article has not been employed in the way that its terms would have suggested or in the way in which the nations probably expected it would work at the time they entered into the alliance. There have been difficulties in the economic field but the fact is that the O.E.E.C. played a very important part in filling the gap that the implementation of article 2 of the NATO treaty was intended to fill. That organization is now in the process of being transformed into the O.E.C.D., with more effective participation intended now by Canada and the United States as full members instead of merely associate members as they were before. The O.E.C.D. is wider in its membership than NATO. It embraces not only the members of NATO but the neutral countries of western Europe as well.
So it cannot be said that there is any great gap left in the economic growth of the North Atlantic area by reason of the failure to give literal implementation to the terms of article 2 of the NATO treaty. The fact is that O.E.E.C. and then O.E.C.D. have played a very effective role in this respect.
The immediate question, Mr. Chairman, is: Shall Canada default on her obligations to NATO, to the other allies in this alliance? The C.C.F. party may think that Canada does not need allies in this world. Perhaps there have been other countries in the past that entertained that idea. Some of them woke up to a dreadful day of reckoning. I think most Canadians will feel that in the kind of world in which we find ourselves today it is not a bad thing for Canada to have allies. How long would Canada have allies if she now chose the role which she is invited by the C.C.F. to take and became a defaulter and renounced the obligations she entered into in favour of her allies? This is the issue presented by this amendment tonight.
Shall we say to those who have entered into this defence partnership with us: "We are leaving you, we want no more of you. We realize that you have got to carry a burden but we are not going to share that

Supply-National Defence burden with you any more. We are withdrawing. We are going back across the Atlantic."
Is that the language of realism in this year of grace and international disturbance, 1961? Is this the lesson that we have learned in recent years in the international field, that Canada can withdraw, live unto herself and take the attitude of a pious nation that has no great concern with the problems of other nations a little closer to the areas of aggression in the world today?
So, Mr. Chairman, let it be clearly understood that, so far as the government is concerned, we believe in the honourable implementation of Canada's obligations. We believe as well that it is a good thing for Canada to have allies. We believe in saying to these allies that we are not going to turn tail and leave them in the lurch, that we are not going to be parties to signalling any retreat from NATO. We stand squarely for NATO. We recognize it is not perfect. We recognize that it is a human instrument and there will be difficulties as long as it operates through human beings and as long as we have strife and the threat of aggression in the world today. But with all its shortcomings this is the instrument that has preserved not only Canada's freedom but the freedom of the western world, and we want that freedom to be preserved. We are not prepared to accept the invitation of the C.C.F. to dishonour Canada's obligations.


Lester Bowles Pearson: Mr. Chairman, the amendment that we are invited to support has brought out into the open in the House of Commons, in respect of this vital matter of collective security, the position of the C.C.F.-socialist party. It is now perfectly clear and perhaps it is just as well that it should be so.
I do not always agree with the Minister of Finance but on the argument he made tonight I agree with him 100 per cent. As the minister has said, we are being invited by this amendment to run out on our commitments to the North Atlantic Treaty Organization and to the principle of Atlantic collective security. That course would not only be humiliating for Canadians, it would be disastrous and would have effects which would be felt far beyond the borders of our own country at this particular moment when the threat to our security persists and the danger is still present as it was ten or 11 years ago when we founded NATO.
The danger has changed, the threats have been modified and I have no doubt in my own mind that the organization which we founded in those earlier years should also be altered and modified to meet these changing threats and changing dangers. But the threats

and the dangers are still there and in the circumstances they require an organization for collective security.


Erhart Regier: What about the United Nations?


Lester Bowles Pearson: I will come to the United Nations in a moment. My hon. friends to the right cannot arrogate unto themselves exclusive virtue on this matter of support for the United Nations. We will consider that in a few moments.
This amendment, Mr. Chairman, is really a withdrawal from the North Atlantic Treaty Organization. This is a vote of no confidence in Atlantic collective security, and we are opposed to it. With all its faults-and it has had its setbacks; as the minister pointed out, it is a human organization-NATO has done great things for freedom and security in the last dozen years. Perhaps if it had not been for NATO and for what it stood during these dangerous years in the late forties and early fifties when the eastern steamroller was moving across Europe, perhaps if it had not been for this demonstration of western solidarity and collective security, the hon. member for Assiniboia would not be able to move this amendment in this free parliament tonight.
My hon. friends in the corner say, what about the United Nations? Well, there is nothing contradictory about supporting NATO and supporting the United Nations, and there never has been. If the United Nations could only give us on a universal scale the kind of collective security we want, and we hope one day we will get, there would be no need for NATO. I hope it may come to that, and we will be able to scrap NATO in favour of a bigger, better, universal organization. This is the purpose of the charter of the United Nations, but we have not realized that purpose. Until we do realize that purpose we are entitled, as free members of the international community, to band ourselves together in regional organizations for collective security. What we have done under NATO is what I hope we will continue to do as long as NATO performs this collective function and as long as the necessity for collective security persists.
When I support NATO I never feel that this is any reflection on my wholehearted support of the United Nations. I never have felt that way and I do not feel that way tonight. I agree with what the hon. member for Assiniboia has said that we should do all those things under the United Nations that we can do. We should build up security. But until we can do these things in the United Nations, the North Atlantic Treaty Organization still has value for us.

My bon. friends have made reference to article 2, sometimes known as the Canadian article. When the NATO treaty was drafted, the Canadian delegation did play some part in getting this article put into the treaty. It is quite true that we have not been able to implement article 2 over the years as we had hoped would be possible. There is no doubt about that. The Minister of Finance has already stated that we have been disappointed in that respect. In recent weeks we have been discussing in this house an organization for European Atlantic economic co-operation and development. This will be a wide organization covering all the European states, except one or two and we may-I put it no higher than that-be able to do in it what we have not yet been able to do under article 2 in NATO. If we can do that I will be quite satisfied because this organization would be performing every economic co-operative function of article 2.
However, there is more in article 2 than economic co-operation. There is the desirability of political co-operation amongst the Atlantic countries. Until more progress has been made on that score, action in the direction of the political co-operation, all that we had hoped for under NATO will not be possible. However, is that any reason why we should scrap the whole organization at this time as my hon. friends to the right would do? I agree, as I have just said, that changes are required. I have no doubt that changes in the structure of NATO to make it a more effective organization in the face of the new dangers, the new threats and the new opportunities are being considered. I hope that is true. Anything I say tonight about NATO will not preclude me, when the time comes, from putting forward the ideas which I think will improve and strengthen NATO. But this is not scrapping it.
If NATO does not move in the direction of a stronger politically co-operative organization, in the direction of greater unity rather than less unity, it may well be that NATO will disappear. It may be, too, that if NATO becomes only an organization for military co-operation-


Murdo William Martin: As it has.


Lester Bowles Pearson: -that just is not true and no statement can make it true. If NATO does become only an organization for military cooperation to meet a military danger, then of course NATO will disappear when the danger disappears. We should, therefore, try to find a broader, deeper foundation for NATO than merely military co-operation. But believe me, Mr. Chairman-this is where we disagree with my hon. friends to the right-the need for defence co-operation still exists. They would
Supply-National Defence scrap NATO, but I would not scrap it. I would not scrap it. I would make NATO stronger rather than weaker, even as a defence organization. I do not want to withdraw from collective security on an Atlantic basis. I do not want to withdraw from any organization which makes it possible for free countries to stand together and, within even a limited area, do what they can to discharge the collective security function which is recognized in the charter of the United Nations. I do not want to withdraw into isolation or neutralism. I do not want to weaken our support for the United Nations. But none of these things would prompt me to withdraw from the North Atlantic Treaty Organization at this particular time.
The hon. member for Assiniboia, perhaps in the hope of strengthening his argument, talked about NATO nuclear weapons. This brings up one of the changes that I should like to see brought about. Perhaps it is being considered in NATO at the present time. I think it is important to make the North Atlantic organization, as a defence organization, much stronger in conventional forces than it is at the present time. Then, the organization would not have to rely on nuclear weapons for defence against every aggression, no matter how regional, no matter how limited, or how small it might be.
As I understand the purpose of this particular amendment it is to strengthen, perhaps in a small way, the conventional forces of NATO. I think this is important. As long as the NATO countries in Europe feel that they have no alternative but to use nuclear weapons against aggression, no matter what kind or character of aggression, I think that NATO is weaker rather than stronger. There may be occasions arise when it would be very difficult indeed for anyone to press the nuclear button and if that were the only button that could be pressed, we would be subjected to grave peril indeed. I want to see the conventional forces of NATO not weakened but strengthened. I want to see NATO rely less and less on nuclear deterrents and more and more on the strength of the NATO countries to withstand aggression without using nuclear weapons.
I think, Mr. Chairman, that is very sound defence policy. I think it is a good policy in other respects. It will make NATO and the European countries less dependent, for instance, on the United States and nuclear weapons than they may be at the present time. There are three members of the NATO alliance that have nuclear weapons now, the United States, the United Kingdom and France. So far as NATO forces are concerned, and I speak subject to correction, all those nuclear weapons which are in Europe at the

Supply-National Defence present time in the hands of NATO forces- except perhaps United Kingdom weapons and I am not sure they have any-are under the single control of the United States authorities. I think that is wrong. If NATO through a decision of its council decides that tactical nuclear weapons are required for defence purposes, and I am talking about tactical nuclear weapons only for defence purposes, then I say this. If the NATO council thinks that weapons of that kind are required, then we have taken the position in our party that those weapons should be brought under NATO control and that those NATO members which now possess them should turn those weapons over to the control of the NATO organization. That is not extending the use of nuclear weapons. That is limiting their use to the NATO organization rather than to individual nations.


An hon. Member:: To people like Speidel, the former nazi general.


Lester Bowles Pearson: If my hon. friend wants to be consistent, he would probably take the position that no German should have anything to do with the north Atlantic organization. If we take the position that Germany cannot associate at all with Atlantic security, Atlantic development or the Atlantic community what do we do with Germany? We drive her into the arms of the people of whom we have cause to fear. If that is the policy of my hon. friends to the right, I should like them to try to defend that policy in this country. That is the kind of policy that in 1919, 1920 and 1921 helped to bring about the nazi regime in Germany. If my hon. friends want a recurrence of that policy, they are welcome to it.


Hazen Robert Argue: We just said we did not want a nazi general heading it up.


Lester Bowles Pearson: You just said you did not want Germans.


Hazen Robert Argue: German generals.


Lester Bowles Pearson: That is a far-reaching extension of policy when the party on my right said that they did not want the German republic to take any part in the development of the Atlantic community.


Hazen Robert Argue: Nobody said anything like that or nearly like it.


Lester Bowles Pearson: It will be on Hansard.


Charles Edward Rea: Order.


Lester Bowles Pearson: I think I have made the position of my own party on this matter quite clear and I am very glad of having had the opportunity of doing so. We think the NATO organization should be changed in order

to bring it more into accord with the changing situation. We think that political and other kinds of non-military co-operation in NATO should be stronger and not weaker. We think that the defence policy of NATO should be stronger, not weaker, but that defence strategy tactics and co-operation in NATO should be based not on nuclear weapons but on the building up of conventional forces which will give the European countries protection without the necessity of using nuclear weapons.


Murdo William Martin: Mr. Chairman, we have had a couple of very good demonstrations here. We have had a demonstration of Tory policy which is one purely and simply, of thinking back. We have had a demonstration of Liberal policy which goes back even further than that of the Tories. In fact, the Leader of the Opposition had us back almost to the days of bows and arrows for a little while. The Minister of Finance, when making his presentation here tonight, of course, very conveniently forgot or omitted the fact that when he was back 10 years, 12 years or 13 years ago, the C.C.F. supported that position at that time; that the C.C.F. never denied the benefits that NATO may have contributed at that time. But the C.C.F. unlike the minister and the party which he represents, can recognize things as they are now, not as they were 10 years ago, 50 years ago or 100 years ago. We are prepared and willing to accept the facts as they are today, not as they were in the past. This is something that they conveniently forget. They forget that today we are in 1961, not 1951.


An hon. Member:: What about tomorrow?


Murdo William Martin: Exactly; what about tomorrow? If we are going into tomorrow while looking into yesterday, where is it going to get us?


An hon. Member:: Right where you are.


Murdo William Martin: The minister admitted very frankly that article 2 of NATO had never been implemented to date. I should like to congratulate the minister on that admission. It is true that it has never been implemented. It is also true that it will never be implemented as long as we keep looking back and do not look ahead. Surely the minister can realize that. We have had examples in this chamber. We had a Liberal government that looked back 40 years to the time when they promised health insurance. For 40 years they looked back but they never implemented it. It was only when the Conservative government came into office that it finally implemented this promise to which the Liberals were looking back 40 years.

Business of the House
This position is what we face today with Mr. Chevrier: The Minister of Finance regard to this NATO situation.	looks concerned.


An hon. Member:: You were in the wilderness for 25 years.


Lester Bowles Pearson: He is talking about the Regina manifesto.


Lionel Chevrier: Tell us about the Regina manifesto.


Murdo William Martin: The fact still remains that, as their national leader put before the committee tonight,-


An hon. Member:: Which one?


Murdo William Martin: -we are not prepared to share this burden so long as it is purely and solely a military burden and so long as it does not implement the things that it is supposed to implement. As long as we can see no progress-
The Depuly Chairman: Order. I am sorry to interrupt the hon. member but it is ten o'clock.
Resolutions adopted in committee of supply this day reported and concurred in.



BUSINESS OF THE HOUSE

Lionel Chevrier: I presume that tomorrow we will continue with these estimates; and I take it that it is the hope, not so much of the house leader as of the Minister of Finance, that we will terminate them. However, I should like to ask the house leader what the house will be doing when we reconvene on April 10?


Mr. Churchill:: Tomorrow I think the house would indicate its wisdom by completing the supplementary estimates. There are some items of the supplementary estimates that are of great importance to a large number of people in this country. I mention only one group, namely the disabled veterans of Canada. The item in the supplementary estimates which refers to them is one which should be passed speedily so that their next cheque will carry to them the information that parliament has dealt with that particular problem. I think tomorrow we should consider passing the supplementary estimates even if we have to carry on beyond the hour of six o'clock.
After the supplementary estimates are through there will be the normal appropriation bill and then, as the other house has dealt with interim supply, we will be prepared for royal assent for that item as well as for the supplementary estimates. When we resume on the 10th-


Donald Methuen Fleming: May I say this? I am gravely concerned. Far be it from me to suggest that any hon. member should curtail his remarks. The fact is, however, that included in these supplementary estimates are a good many provisions for salaries. My colleague has referred to the appropriation for the veterans, item 755, but I must draw attention to the fact also that there are numerous salary items here as well and those salary cheques cannot go out unless the bill is first passed and this supply released.


Gordon Minto Churchill: When we resume on April 10-


Lionel Chevrier: I remember the same exhortations when 1 was on the other side.


Gordon Minto Churchill: When we resume we shall deal with supply motions on April 10 and 11. Then the forecast-and this is subject to change-is that on Wednesday, April 12, we would consider the second reading of Bill No. C-72, to amend the Customs Tariff, and then on Thursday and Friday of that week we would resume discussion of the estimates of the Department of Agriculture followed by those of the Post Office Department.
I might point out for the interest of the house that this is the 77th day of this session. We have completed 17 pieces of legislation. The estimates of one department have also been dealt with and we are further ahead than we were last year at this time because it was not until the 90th day that we succeeded in passing the estimates of the first department.


Herbert Wilfred Herridge: I should like to ask the
leader of the house if he would consider bringing all the other estimates before the committee tomorrow and leaving until the last the estimate we have just been discussing?


Lionel Chevrier: No.


Gordon Minto Churchill: We would still have to pass every other item in the supplementary estimates to deal with the appropriation bill and get royal assent. The actual arrangement in which the estimates are taken during the course of the day might be something we could discuss through the usual channels tomorrow morning.


Lionel Chevrier: I submit we should proceed in the usual manner.


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