1962-02-26

Mr. Arthur Smith (Calgary South) moved: for leave to introduce Bill No. C-71, for the establishment of an annual youth appreciation week.


Some hon. Members:: Explain.


Arthur Smith: Mr. Speaker, the purpose of the bill is described in its preamble. There is little I can add except to say that a number of service organizations in the country have requested that such a bill be introduced to give us an opportunity to set aside a week in which to reflect upon the positive and good qualities of the vast majority of our young citizens and simultaneously, through a program of activities, to permit the adult population to become more fully aware of their qualities.
Motion agreed to and bill read the first time.



QUESTIONS

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)

Mr. Fisher: 1.	Has the Minister of Northern Affairs and National Resources made any statements in the past year about the development of skiing in the maritime national parks?
2.	If so, when, where, and to what effect?
3.	At the present time, how much skiing takes place in the national parks located in Nova Scotia?


Mr. Dinsdale:: I will answer parts 1, 2, and 3 together, Mr. Speaker.
At the present time, little or no skiing takes place in the national park located in Nova Scotia. However, within the past year I have received representations from the hon. member for Cape Breton North and Victoria (Mr. Muir), about the possibility of developing some organized skiing facilities in the Cape Breton Highlands national park. Similar representations have been received from the hon. member for Saint John-Albert (Mr. Bell) with respect to Fundy national park in New Brunswick. I have also held discussions with 26207-1-79
interested individuals in the areas concerned and with representatives of the local chambers of commerce.
Following these representations I made arrangements for an expert, Mr. Franz Baier, to understake a technical survey of the skiing development potential of these national parks. Mr. Baier has completed his assessment and has submitted a report, which is now being studied by the officers of my department.


*SHIP CONSTRUCTION SUBSIDY AGREEMENTS
Mr. Chevrier: 1.	Since the announcement in the house on May 12, 1961, of the subsidy for the construction of ships, how many agreements covering the payment of subsidy for a specific project have been negotiated between the Canadian maritime commission, the shipbuilder, and the shipowner?
2.	How many such agreements covering the payment of a subsidy for a specific project are for (a) operation in the deep sea trade (b) operation in the lake and coastal trade (c) trawlers and fishing vessels?
3.	In what shipyards are these being built?
4.	How many ships for which an agreement has been completed were under construction prior to (a) May 12, 1961 (b) have been commenced since May 12, 1961, and before September 27, 1961 (c) since September 27, 1961?
5.	Of the 79 applications referred to in answer to starred question No. 20, at page 293 of Hansard for January 29, 1962, how many are for (a) operation in the deep sea trade (b) operation in the lake and coastal trade (c) trawlers and fishing vessels?


Mr. Balcer:: As the answer to this question contains a list of over 30 shipyards, perhaps the house will agree to it being printed in Hansard.


Mr. Speaker:: Is the house agreeable to the suggestion of the minister?


Some hon. Members:: Agreed.
[Editor's note: The answer referred to above is as follows:]
1.	Of 79 applications received by the Canadian maritime commission, 23 have been recommended by the commission to the interdepartmental review committee to date; 17 of these have been approved by the interdepartmental committee and four by the treasury board. The balance are still under consideration at commission, committee or treasury board level as indicated by the foregoing statistics.
2.	Of applications received, none are for deep sea trade, 68 for lake and coastal trade, and 11 for fishing trade.

Questions
3.	Yarrows Ltd., Victoria, British Columbia; Victoria Machinery Depot Co. Ltd., Victoria, B.C.; Burrard Dry Dock Co. Ltd., Vancouver, B.C.; John Manly Ltd., New Westminster, B.C.; Allied Builders Ltd., Vancouver, B.C.; Star Shipyard (Mercer's) Ltd., New Westminster, B.C.; West Coast Salvage and Contracting Co. Ltd., Vancouver, B.C.; Island Tug & Barge Co. Ltd., Vancouver, B.C.; S. Madill Ltd., Nanaimo, B.C.; McKenzie Barge & Marine Ways Ltd., Vancouver, B.C.; The Collingwood Shipyards, Collingwood, Ontario; Russel Brothers Ltd., Owen Sound, Ontario; Port Weller Dry Docks Ltd., Port Weller, Ontario; Kingston Shipyards Ltd., Kingston, Ontario; Canadian Vickers Ltd., Montreal, Quebec; Marine Industries Ltd., Sorel, Quebec; Davie Shipbuilding Ltd., Lauzon, Quebec; Geo. T. Davie & Sons Ltd., Lauzon, Quebec; Chan tier Maritime de St. Laurent Ltee, Isle d'Orleans, Quebec; A. F. Theriault, Metegan River, N.S.; W. C. McKay & Sons, Shelburne, N.S.; Reginald Snyder, Lunenburg, N.S.; Smith & Rhuland Ltd., Lunenburg, N.S.; Bathurst Marine Ltd., Bathurst, N.B.; Saint John Shipbuilding & Dry Dock Co. Ltd., Saint John, N.B.; E. F. Barnes Ltd., St. John's, Newfoundland; Springdale Construction Co. Ltd., Barnes Ltd., St. John's, Newfoundland; Springdale, Newfoundland; Newfoundland Shipyards, St. John's Newfoundland; Willis Hopkins, Wesleyville, Newfoundland; Reginald Weir, Little Bay Islands, Newfoundland.
4.	Since final agreements have not been signed, the following information is in respect of applications received: (a) 11; (b) 18 and (c) 41. Vessels involved in nine applications are still in the planning stage.
5.	Answered by No. 2 above.


* TRANSPORTATION ROUTES DORVAL AIRPORT, MONTREAL
Mr. Chevrier: 1.	What are the terms of the contract referred to by the minister at page 355 of Hansard of January 30, 1962, between the Department of Transport and the concessionaire providing transportation from Dorval airport to the city of Montreal, as regards transportation and route to be followed?
2.	Is the concessionaire required to follow along Cote de Liesse road?
3.	If not, will the contract be amended so as to provide transportation for those who reside in the area serviced by C6te de Liesse road?


Léon Balcer: The contract with the company providing limousine service to the Montreal international airport does not specify the exact route which must be followed between the city and the airport. In fact the route, including pick-up and disembarking points, is determined by the operator in consultation with the air lines in accordance with air line

requirements taking account, it is understood, of both the fastest method of providing through service from downtown to the airport and, at the same time, the most likely requirements for pick-up and disembarking points en route.


COMPASSIONATE PENSION ALLOWANCES
Mr. Creaghan: 1.	How many persons are now in receipt of a compassionate pension, allowance, or supplementary award as provided by section 25 of the Pension Act?
2.	Have all of these special pensions been reviewed by the Canadian pension commission since the 1st day of March 1961; and, if so, what percentage of the same have been increased or decreased since that date?
Answer by: Mr. Churchill:
1.	475.
2.	No. To date, of those reviewed, approximately 50 per cent have been increased and less than 1 per cent decreased.


DENIAL OF APPLICATIONS FOR MILITARY PENSIONS
Mr. McIntosh: How many applications for pensions have been denied by the Canadian pension commission on the grounds not pensionable under section 13(2) of the Pension Act as the evidence did not establish that the disability or death arose out of or was otherwise directly connected with military service?
Answer by: Mr. Churchill:
Over the period April 30, 1950, to March 1, 1960, a total of 18,672 were denied on this basis. All dischargees who show any sign of disease or disability during service, or at the time of discharge, are referred to the Canadian pension commission for consideration. Less than 10 per cent of these claims were death claims where dependants were involved.


OATH OF OFFICE, PENSION COMMISSION
[Stage Direction]
Question No. 155
Mr. McIntosh:: 1.	Are members of the Canadian pension commission obliged to take an oath of office before assuming their duties?
2.	If so, have all present members of the commission done so?
3.	What is the wording of the oath?
Answer by: Mr. Churchill:
1.	No.
2.	Answered by No. 1.
3.	Answered by No. 1.
While commissioners are not required by statute to take any oath of office, they do take the ordinary oath taken by all civil servants as set forth in the Civil Service Act.


GARIBALDI PARK, B.C.  ACTION BY PROVINCIAL GOVERNMENT
Mr. Winch: Has any offer been made to obtain Garibaldi park in British Columbia as a national park; and, if so (a) what was the date of the offer or offers which have been made (b) has it been considered or accepted by the provincial government of British Columbia (c) is any offer still open?


Walter Gilbert Dinsdale: Mr. Speaker, this matter has arisen in the house on a number of previous occasions during the discussion of my estimates or in the question period. The most recent reference was a reply I gave on April 19 of last year, Hansard, page 3792, to an almost identical question asked by the hon. member for Vancouver-Burrard (Mr. Taylor). In that reply I pointed out that on May 2, 1958 my predecessor had written to the minister of recreation and conservation in British Columbia, Hon. Earle Westwood, proposing that if British Columbia were willing to turn the area over to the federal government, free of all encumbrances, the matter would be brought before the federal government for consideration. Should it be viewed favourably by the government, the Department of Northern Affairs and National Resources would take over the area in accordance with the National Parks Act and proceed with a program of development.
There has been no change in the position since that time.
sale of motor vessel "calabogie"


Mr. Me William: 1.	Was motor vessel Calabogie No. 177425 sold by crown assets disposal corporation: and, if so, to whom and in what amount?
2.	What were the names, and amounts, of other tenders received for the purchase of this motor vessel?


Mr. O'Hurley:: The answers are as follows:
1.	Yes, to S. W. Smith and Son, Parrsboro, N.S. in the amount of $6,127.
2.
J. Splane & Co. Ltd.,
522 Main st., Saint John, N.B. ... $4,225
Bruce Scott, McGrath Cove,
Halifax Co., N.S	 2,000
George H. Ring,
Saint John, N.B	 1,700
Jake Farlane Produce Co.,
Summerside, P.E.1	 1,500
Patrick Miller,
Carbonnear, Nfld	 1,005
Verreault Navigation, Inc.,
Les Mechins, Cte	Matane	 750
A. M. Shaw,
P.O. Box 913, Halifax,	N.S		655
Gerald P. Blakeney,
109 Lakecrest dr.,
Dartmouth, N.S	 550
26207-1-79J
Questions Arthur Halliday,
7 Alma st., Saint John,	N.B	 515
Marsh Plumbing & Heating Ltd.,
Yarmouth, N.S	 500
Jacques Rochette,
113 Moffet ave., St. Foy, Que. 10..	466
province of P.E.1	 100


FOREIGN INVESTMENT CONTROL
Mr. Maiheson: What is the percentage of foreign investment control in the years 1956 and 1961 in (a) the resource industries (b)	the	manufacturing industries?
Answer by: Mr. Morris:
Percentage of foreign investment control of selected Canadian industries:
1956 1959
% %
(a)	Mining and smelting	 58	61
Petroleum and natural gas.. 80 75
(b)	Manufacturing industries.. 52	57
(including some resource industries such as pulp and paper)
Ratios corresponding to above for 1960 and 1961 are not yet available.


TELEPHONE CABLE, LAKEHEAD AIRPORT
Mr. Badanai: 1.	Has the telecommunications and electronics branch of the Department of Transport awarded a contract for the laying of a telephone cable from the lakehead airport to Maplewood road and from Maplewood road to Rabbit mountain?
2.	Who tendered for the job, and what was the amount in each case?
3.	Who was the successful contractor, and what was the total amount of the tender?


Léon Balcer: Mr. Speaker, the answers are as follows:
1.	Yes.
2.	Canadian Pacific Telegraphs; $132,000 to build line for Department of Transport ownership.
Canadian Pacific Telegraphs; $109,783 preoperational construction cost and rentals of $9,486 per year under a five year contract.
City of Fort William; $123,017 pre-operational construction cost and rentals of $16,200 per year. No term of contract stated.
Canadian National Telecommunications; $148,466 pre-operational construction cost and rentals of $11,925 per year under a five year contract.
3.	Canadian Pacific Telegraphs; $109,783 pre-operational construction cost and rentals of $9,486 per year under a five year contract.
use of exchange fund to support dollar


Mr. Matheson: Is the Minister of Finance now using the exchange fund to restrain or support the value of the dollar?

Questions


Mr. Fleming (Eglinlon):: Mr. Speaker, I dealt with this subject in the house on February 9, and the answer will be found at page 711 of Hansard.


* FEDERAL BUILDING, SHEET HARBOUR, N.S.
[Stage Direction]
Question No. 16 7-Mr. McWilliam:
1.	Does the government propose to construct a federal public building at Sheet Harbour, Nova Scotia; and, if so, has land been purchased, and tenders called or awarded?
2.	If tender has been awarded, what are the names, with amounts, of all tenders submitted?
Mr. Walker:: 1.	Construction of a new federal building at Sheet Harbour, Nova Scotia, is being considered but no decision has yet been reached; no land has been purchased nor have tenders been called.
2.	Not applicable.


*DR. EUGENE FORSEY, BOARD OF BROADCAST GOVERNORS
Mr. Fisher: 1.	Has Dr. Eugene Forsey met with any difficulties or impediments in carrying on his duties as a member of the board of broadcast governors; and, if not, is there any substance in the allegation contained in the Toronto Globe and Mail, editorial page, (page 6) of February 12, 1962, that Dr. Forsey is unable to remain with the board when Joseph Sedgwick, Q.C., appears before it?
2.	What explanation, if any, is there for this difficulty?


Mr. Nowlan:: The answer to No. 1 is "no" and the answer to No. 2 is "not applicable".


* PRINTING OF UNEMPLOYMENT COMMISSION
Mr. Benidickson: 1.	Why is unemployment insurance commission form U.I.C. 379 (5-58) marked "Printed in U.S.A."?
2.	How many of these forms (approximately) are utilized on an annual basis by the U.I.C.?
3.	Is there anything unique about this form that makes it undesirable or inefficient to have it printed in Canada?


Mr. Thrasher:: Mr. Speaker, the answers are as follows;
1.	In the operation of the punched card system in certain regions by the unemployment insurance commission a multiple form composed of two punched cards is used. These special multiple forms are not printed in Canada. It has therefore been necessary to have form U.I.C.379 (5-58) obtained from the Remington Rand Company in the United States. However, I am advised that a change in procedure is contemplated by the unemployment insurance commission, which will enable a single form card system to be adopted in due course. This will permit the required cards to be printed in Canada.
[Mr. Matheson.l
2.	Approximately 800,000 forms are used annually.
3.	See reply to No. 1 above.


*ROAD CONSTRUCTION TENDERS, BURNT CHURCH RESERVE, N.B.
Mr. McWilliam: 1.	Were invitations to tender issued for the construction of a road in the Burnt Church reserve, New Brunswick area at Tabusintac; and, if so. what are the names of all the persons asked to submit tenders on the first and/or the second invitation?
2.	From whom were tenders received, and in what amounts?
3.	Who was awarded the contract, and in what
amount?


Mrs. Fairclough:: Mr. Speaker, the answers to the three parts of this question include two relatively short tables. I wonder whether I could have the answer printed in Hansard.


Mr. Speaker:: Has the minister leave to have her answer printed in Hansard?


Some hon. Members:: Agreed.
[Editor's note: The answer referred to above is as follows:]
1.	Yes. Invitations to tender for the reconstruction of two miles of road on the Burnt Church Indian reserve were requested from the following:
1.	Marcellin Roussell, Lower Neguac, N.B.;
2.	White Construction Co. Ltd., Newcastle, N.B.; 3. A. G. Kenny Contractor, Bartibog Bridge, N.B.; 4. George Loggey, Lower Newcastle, N.B.; 5. Cleland Construction Ltd., Newcastle, N.B.; 6. McAllister Brothers, Newcastle, N.B.; 7. John Innis, Bartibog, N.B.; 8. James Russell Lumber Co., Ltd., Russellville, N.B.
2.	The following tenders were received in the amounts indicated:
1.	Marcellin Rousell, Lower Neguac, N.B. $6,500.00; 2. White Construction Co. Ltd., Newcastle, N.B. $7,092.00; 3. A. G. Kenny Contractor, Bartibog Bridge, $7,315.50;	4.
George Loggey, Lower Newcastle, N.B. $7,815.50; 5. Cleland Construction Ltd., Newcastle, N.B. $8,450.00 6. McAllister Bros., Newcastle, N.B. $8,500.00; 7. John Innis, Bartibog Bridge, N.B. $8,550.00; 8. James Russell Lumber Co. Ltd., Russellville, N.B. $9,975.00.
3.	The contract was awarded to Mr. A. G. Kenny of Bartibog Bridge, New Brunswick, in the amount of $7,315.50.


* SILENT TESTS ON WARNING SIRENS
Mr. Pitman: 1.	Is the army carrying on, daily, silent tests on all warning sirens to determine if sirens are, in fact, frozen; and, if so (a) were silent tests carried on in Peterborough from February 1 to

Questions
February 12	(b) on what dates (c) how many
sirens were tested (d) how many were found frozen?
2.	Is the Army carrying on any program to discover any indoor warning system; and, if so, when is it proposed that such a system might be available for general use?


Mr. Chambers:: The answers are as follows:
1.	The army does not carry out daily silent tests on all warning sirens.
(a)	No.
(b)	Tests were carried out January 29, 1962, and February 15, 1962.
(c)	Five sirens were tested each date.
(d)	One was frozen up on January 29, 1962. None were frozen up on February 15, 1962.
2.	Examinations are being carried out on a number of indoor devices to ascertain the availability and suitability of each. It is not possible to forecast at this time when a decision would be reached on this matter.


*N.H.A.  LOANS FOR FALL-OUT SHELTERS
Mr. Pitman: 1.	How many persons have applied for loans under the provisions of the National Housing Act for the purpose of budding a fall-out shelter?
2.	What is the total amount borrowed for this purpose?


David James Walker: In answer to part 1, I may say that under the provisions for N.H.A. loans for new houses, loans to 62 borrowers included allowances for fall-out shelters to January 31, 1962. Under the home improvement loan provision of N.H.A., 44 loans were made for the construction of fall-out shelters to November 30, 1961.
The answer to part 2 is that it is not possible to provide the total amount borrowed for these particular purposes. It is known that the estimated costs of the fall-out shelters referred to above amounted to $74,873.
[DOT]small business loans


Mr. Pitman: 1.	What was the total amount of money lent under last session's Bill C-4 (Small Businesses Loans Act) in the year 1961?
2.	How many loans were made during 1961 under the said act?
3.	How many loans were made in amounts from (a) up to $500 (b) $500 to $1,000 (c) $1,000 to $5,000 (d) $5,000 to $10,000 (e) $10,000 to $15,000 (f) $15,000 to $20,000 (g) $20,000 to $25,000?
4.	How many applications were (a) received (b) rejected?
5.	What was the average amount of the loan made under the said act?


Donald Methuen Fleming: 1.	The total amount of money lent by the chartered banks to applicants for loans under the Small Businesses Loans Act in the year 1961 was $25,582,269.41.
2.	2,977.
3.	Information not available.
4.	Information not available.
5.	$8,593.


TRANSPORTATION COMMISSION
Mr. Pitman: 1.	Was Mr. Heakes employed by the royal commission on transportation in 1960; and was any contract signed?
2.	In what capacity were Mr. Heakes' services used, at what salary was he hired, and for what period of time was he to be employed?
3.	How many extra days did Mr. Heakes report for work and hand in research material which was accepted by the commission?
4.	Did Mr. Heakes demand any payment for additional work with the royal commission on transportation?
5.	Was Mr. Heakes paid any additional sum for his work with the commission, and how much was he paid?
Answer by: Mr. Diefenbaker:
1.	Mr. Heakes was engaged by the commission as an economic consultant in February, 1960. The terms of the engagement were recorded in an exchange of letters between him and Mr. E. P. Reid, the assistant director of research of the commission.
2.	He was asked to undertake a short economic research project to assemble information for the staff of the commission. He was engaged for 10 days at $50 per day.
3.	Mr. Heakes claimed to have done 18 additional days' work which cannot be verified since the terms of his engagement stipulated that he was to work elsewhere than in the offices of the commission. He submitted additional material which he said was prepared during this further period. This material was accepted by officers of the commission who told Mr. Heakes that they had no authority to pay him for more than 10 days work and that he could not be assured of any further payment for additional work done.
4.	Yes.
5.	Yes, $450.


C.M.H.C. BOARD OF DIRECTORS
[Stage Direction]
Question No. 177
Mr. Martin (Timmins):: 1.	Who are the members of the board of directors of Central Mortgage and Housing Corporation?
2.	When was each appointed, and when do their present terms expire?
3.	What has each drawn in the years 1960 and 1961 in (a) salary (b) expenses?
4.	How many meetings has the board held in those two years?
Answer by: Mr. Walker:
1.	The members of the board of directors of Central Mortgage and Housing Corporation are as follows: Mr. Stewart Bates, Mr. P. S.

Questions
Secord, Mr. A. J. Boisclair, Mr. R. B. Bryce, Mrs. M. Campbell, Dr. A. F. Laidlaw, Brigadier N. D. Lambert, Mr. J. C. Miller, Mr. J. F. Parkinson, Maj. Gen. H. A. Young.
2.	The dates on which each of the members of the board of directors were appointed and the dates on which their present terms of office expire are as follows:
Mr. Stewart Bates Mr. P. S. Secord Mr. A. J. Boisclair Mr. R. B. Bryce
Mrs. M. Campbell Dr. A. F. Laidlaw Brig. N. D. Lambert Idr. J. C. Miller Mr. J. F. Parkinson
Maj. Gen. H. A. Young
Date of Appointment December 6, 1954 November 1, 1950 July 1, 1960 March 8, 1955
November 1, 1960 April 1, 1959 January 31, 1946 July 31, 1958 May 20, 1954
June 20, 1951
Date of Expiry December 6, 1968 November 1, 1964 July 1, 1963
Holds office during the pleasure
of the governor in council
April 1, 1965
April 1, 1965
April 1, 1963
April 1, 1964
Holds office during the pleasure of the governor in council Holds office during the pleasure of the governor in council
3.	The fees and expenses for the years 1960 and 1961 paid to each of the members of the board of directors for acting in the capacity of a director of the corporation are as follows:
Fees
Mr. Stewart Bates	 Nil
Mr. P. S. Secord . v	 Nil
Mr. A. J. Boisclair	 $300
Mr. R. B. Bryce	 Nil
Mrs. M. Campbell	 Nil
Dr. A. F. Laidlaw	 $1,350
Brig. N. D. Lambert	 $600
Mr. J. C. Miller	 $750
Mr. J. F. Parkinson	 Nil
Maj. Gen. H. A. Young	 Nil
1960	1961
Expenses	Fees	ExpensesNil	Nil	NilNil	Nil	Nil$100.38	$750	$327.38Nil	Nil	NilNil	$750	$96.95Nil	$1,500	Nil$1,402	$750	$1,714$919.20	$750	$995.35Nil	Nil	NilNil	Nil	Nil4.	During 1960 and 1961, there were 10 meetings of the board of directors and an additional 28 meetings of the executive committee of the board of directors.*	VOCATIONAL AND TECHNICAL TRAINING


PERSONNEL
Mr. McMillan: 1.	How many unemployed persons have taken technical and vocational training undertaken by the provinces on a cost sharing basis with the federal government?
2.	How many such persons were so engaged at the last available date?


Richard Devere Thrasher: 1.	38,144.
2.	8,426 as at January 31, 1961.
*	PROTESTS OF CIVIL SERVICE PENSIONERS


Mr. Fisher: 1.	Has the Minister of Finance received any protests in the last year from pensioners of the

government who retired during or before the last war, whose pension totals are more than $3,000 a year, and therefore are unable to benefit by improvements in the pensions given to other pensioned civil servants of the same time?
2.	If so, what reply, in substance, has the minister made to such protests?


Donald Methuen Fleming: 1.	No.
2.	Not applicable.


* WAGE RATES, BUILDING TRADESMEN, PUBLIC BUILDINGS
Mr. Winch: 1.	Has the treasury board within the past twelve months laid down a government policy respecting wage rates for building tradesmen employed in the House of Commons, or any other federal public building in Canada, affecting those who were previously classified as prevailing rate employees?

2.	Were former rates of wages previously based on the construction rates established in the local area by trade union agreement and contracts with employers?
3.	Has there been in the past twelve months a ruling of the treasury board that those employed in federal government buildings in the category of electricians, steam fitters, carpenters, plumbers, machinists, etc., will now be paid on the prevailing rate in the local area as maintenance men although their responsibilities may include construction installation?
4.	If such a recent ruling was made by the treasury board, does the said ruling apply to electricians, steam fitters, carpenters, plumbers, machinists, etc., employed on such projects controlled by the government as dockyards?


Donald Methuen Fleming: 1. Building tradesmen employed in the House of Commons are not under treasury board jurisdiction. For tradesmen employed in other federal buildings in Canada, the treasury board decided that prevailing rate employees engaged on construction work would continue to receive rates paid for construction work outside the public service and that employees performing maintenance duties be granted wages paid for similar work outside the service.
2.	Wage rates established by trade union agreement and contracts with employers were paid where these rates reflected the over-all prevailing wage rate in the area of employ-
Questions
has been to decline to answer such questions as not being in the interests of the public, and there is no intention of changing this policy.


Mr. Howard:: The answer is obviously yes, then.



COMMUNIST CHINA


Mr. Howard: Since January 1, 1958, has the government or any agency, branch, department, or member thereof, proposed to or discussed with, the government or any representatives of the People's Republic of China the possibility of that country buying (a) dry salt herring, or (b) other fisheries products from Canada; and, if so, what resulted therefrom?
Answer by: Mr. Morris:
Since January 1, 1958 our trade commissioners in Hong Kong have kept the question of the sale of fish and fish products, particularly dried salt herring, under constant review and have made approaches to the China Resources Company and their associate company, Ng Fung Hong. In addition when our trade commissioners have visited the mainland they have raised this question directly with officials concerned.
ment.
3.	As outlined in 1. To date no job specification for the class machinist has been issued.
4.	The rate for tradesmen employed in government dockyards is the prevailing rate for similar tradesmen employed in the shipbuilding industry in the area of employment.



*R.C.M.P. TELEPHONE LINE TAPPING

Mr. Howard: Does the Royal Canadian Mounted Police engage in the practice of telephone line tapping or listen in on, or record, telephone conversations between people who are not members of the said force?


Mr. Browne (St. John's West):: In accordance with long established policy I am declining to answer this question in the public interest. Questions such as this, and all others which have been asked regarding investigational procedures, could in due course, if answered, lead to disclosure of all methods which must necessarily be employed to protect the security of this country. Such revelations would be of great interest and value to groups within and outside Canada who have used conspiratorial methods to obtain Canadian information to which they are not entitled.
There should be no inference taken from my remarks and the form of my reply because such discussions, in whatever form they take, can only tend to imperil the difficult investigations which have to be carried out in the interests of our country. The policy of this government, and previous governments,
On each occasion they have been told that there was no interest in the importation of Canadian fish or fish products.



INVESTIGATION, DOIG RIVER INDIAN SCHOOL

Mr. Howard: 1.	Since November 1, 1961, has any investigation been made into conditions of the Doig river Indian school; and, if so, what, in detail, was discovered as a result of that investigation?
2.	If the investigation indicated that changes were necessary at the school, what steps have been taken to implement the said changes?
3.	Was the said school closed for any period of
I time; and, if so, (a) between what dates, and for what reasons (b) what arrangements were made for the students at the school to continue their education during the period of the closure?
Answer by: Mrs. Fairclough:
1. Yes. Investigations into conditions of the Doig river Indian school were made by departmental officials. The department has also been informed that a committee of the Fort St. John and district chamber of commerce visited the school and reported that they found the school and teacherage reasonably adequate.
J This school was constructed in 1950 to jneet the immediate educational needs of Endians who had congregated about a store fto form a settlement known as Petersons on the Beatton river. The school is not located on an Indian reserve but on land leased by the department. The school consists of a one classroom building and teacher's house

Questions
nearby. These facilities compare favourably with small non-Indian schools in remote areas.
A power plant was installed in 1960 and the school equipped with electric lights and an oil space heater. Water was obtained from a river some 50 yards away.
The investigation revealed that with the exception of pencils and certain cleaning materials there was an adequate quantity of school supplies. Although in the summer of 1961 a contract for the drilling of a well near the school was awarded, difficulty was experienced in commencing the operation.
2.	The drilling of the well has now been completed and arrangements have been made for the purchase of pencils and cleaning materials locally.
3.	(a) The Doig river school was never officially closed but on November 21, 1961, the teacher reported that he had been dismissed and had left the school.
(b) By letter dated December 9, 1961, the teacher was informed that he had not been dismissed. He was instructed to return to the school and to resume classroom instruction immediately. He returned to his duties on December 14, 1961.



MACKENZIE DISTRICT INDIANS


Mr. Howard: What action has been taken with respect to the recommendations of the commission of inquiry, appointed on June 25, 1959, to inquire generally into all matters arising out of unfulfilled provisions of treaties 8 and 11 as they applied to Indians of the Mackenzie district?
Answer by: Mrs. Fairclough:
The recommendations of the commission have been under study by an interdepartmental committee. This study is now completed and a report has been submitted to the government for consideration.



WOOD ISLAND HARBOUR ENTRANCE, P.E.I.

Mr. Pickersgill: 1.	Was a contract let to Eastern Enterprises to widen the entrance of Wood Island harbour, P.E.I.; and, if so, on what date?
2.	On what date was the work contracted for to be completed?
3.	Was a sub-contract let for the dredging; and, if so, to whom?
4.	Have there been any delays in carrying out the dredging; and, if so, for what reason?
5.	When is the dredging supposed to be completed?
6.	What was the estimated cost of inspection services on this job?
7.	What has been the actual cost to date? Answer by: Mr. Walker:
1.	Yes; on June 8, 1960.
2.	February 8, 1962.
3.	Yes; to Maritime Dredging Limited.

4.	Yes; due to minor plant breakdowns and winter conditions.
5.	An extension to June 30, 1962, has been approved.
6.	$13,422.00.
7.	On contract, $282,203.22; on inspection services, $10,531.70.



WHEAT SALES TO CHINA RESOURCES COMPANY

[Stage Direction]
Question No. 189
Mr. Mcllrailh:: 1.	Has the Canadian government insured the credit risk or otherwise guaranteed payment to the Canadian wheat board for the wheat sold to the China Resources Company?
2.	If so, by what statutory authority was such guarantee or credit arrangement made?
Answer by: Mr. Harkness:
1.	This matter was covered by order in
council P.C. 1961-1012 of July 13, 1961, which was reported to the house in the summary of orders in council passed that month, tabled on September 27,	1961. This order authorized the Minister of Finance to give the Canadian wheat board an undertaking that, in the event of any default by the China National Cereals, Oils and Foodstuffs Import and Export Corporation in respect of payments due the board under contracts for the sale of Canadian wheat and barley made under the long term agreement between the said board and the said corporation, such parliamentary approval as may be necessary will be sought to enable direct reimbursement by the government of Canada to the board of any payments in respect of which the corporation is in default, and authorized the minister also to guarantee to six chartered banks the repayment of advances and interest thereon made to the board up to a total not to exceed $100 million outstanding at any time for the purpose of financing the sale of up to 6 million long tons of Canadian wheat and barley under the long term agreement between the board and the corporation.
2.	The guarantee was given under section 11 of the Canadian Wheat Board Act, and the authority to make the undertaking was given to use the powers vested in the crown by section 54 of the British North America Act.



POST OFFICE BUILDING, DRYDEN, ONT.

Mr. Benidickson: 1.	Has the Minister of Public Works received a request for a new post office for Dryden, Ontario?
2.	Is the Department of Public Works planning an extension to the present post office building?
3.	Is the department planning the construction of a new building in a new location; and, if so, what new location is being considered?
Answer by: Mr. Walker:
1.	No.
2.	No.
3.	No.



*SALE OP GRAIN TO CHINA-GUARANTEE

Mr. Benidickson: 1.	Since May 2, 1961, has the government, with reference to the agreement for sale of grain to the China Resources Company, indicated to the Canadian wheat board that it is prepared to guarantee a sum greater than $50 million as the total credit that may be outstanding at any one time?
2.	If so, what has been the highest amount of the guarantee since May 2, 1961?
3.	What was the amount outstanding under the guarantee on (a) October 15, 1961 (b) November 15, 1961 (c) December 15, 1961 (d) January 15, 1962 (e) February 15, 1962?


Mr. Harkness:: This answer is rather lengthy and contains a long list of figures. I wonder if it could be printed in Hansard without being read?


Mr. Pickersgill:: Agreed.
[Editor's note: The answer referred to above is as follows:]
1. This matter was covered by order in council P.C. 1961-1012 of July 13, 1961, which was reported to the house in the summary of orders in council passed that month, tabled on September 27, 1961. This order authorized the Minister of Finance to give the Canadian wheat board an undertaking that, in the event of default by the China National Cereals, Oils and Foodstuffs Import and Export Corporation in respect of payments due the board under contract for the sale of Canadian wheat and barley made under the long term agreement between the said board and the said corporation, such parliamentary approval as may be necessary will be sought to enable direct reimbursement by the government of Canada to the board of any payments in respect of which the corporation is in default, and to guarantee to six chartered banks the repayment of advances and interest thereon made to the board, to a total not to exceed $100 million outstanding at any time, for the purpose of financing the sale of up to six million long tons of Canadian wheat and barley under the long term agreement between the board and the corporation.
2.	February 20, 1962 .
3.	October 15, 1961 . November 15, 1961 December 15, 1961 . January 15, 1962 . February 15, 1962 .
____$71,822,308.90
____	47,027,089.60
____	56,302,009.14
____	60,274,075.32
____	60,873,307.09
____	70,066,512.90



*SALE OF GRAIN TO CHINA


Mr. Benidickson: 1.	How many bushels of grain, sold under contracts with the China Resources Company, were shipped from January 1, 1961, to date from Canadian Pacific coastal ports?
2.	How many bushels of grain, under the same contracts and for the same period, were shipped from other than Canadian Pacific coastal ports, and how many bushels from each of the said ports?
Questions


Douglas Scott Harkness: Mr. Speaker, the answer to these two questions in combined form is as follows:
The following quantities of grain have been shipped during the period January 1, 1961 to February 21, 1962, under contract with the China National Cereals, Oils and Foodstuffs Import and Export Corporation and its accredited agent, the China Resources Company.
First, wheat from Pacific coast ports, 53,343,236 bushels; from St. Lawrence ports, 19,376,406 bushels; from Atlantic ports, 1,852,031 bushels, being a total of 74,571,673 bushels. Shipments of barley from Pacific coast ports entirely totalled 32,631,433 bushels.
I think I should add that of this total of 74 million-odd bushels of wheat, 31,727,421 bushels were for cash sales and 42,844,252 bushels were credit sales. For barley the same figures are cash sales, 12,694,500 bushels, and credit sales 19,936,933 bushels.



* CARRYING CHARGE, ACCUMULATED DEFICITS,

Mr. Malheson: What is the carrying charge of the accumulated deficits 1957 to 1961 inclusive?


Donald Methuen Fleming: Total budgetary deficits from April 1, 1957, to March 31, 1961, amounted to $1,401 million. Net interest payments in the fiscal year ended March 31, 1961 were 3.80 per cent of the net debt. Applying this interest rate to the accumulated deficit of $1,401 million indicates a carrying cost of $53.2 million.



* FRASER RIVER SURVEY, B.C.

Mr. Howard: Is any survey work being done by the Fraser river board along the upper reaches of the Fraser river in British Columbia; and, if so, (a) has this survey work covered the questions of the level of snowfall in those areas during the current winter, and the detrimental effect such snowfall might have upon possible floods in the lower Fraser valley this coming spring and summer (b) what has been discovered as a result of these surveys?


Walter Gilbert Dinsdale: The Fraser river board does not conduct snow surveys in the Fraser river basin. This work in British Columbia is carried out by the water rights branch of the provincial department of lands and forests. The comptroller of water rights issues a snow survey bulletin as of February 1, March 1, April 1, May 1, May 15, and June 1 of each year, giving the results of samplings. The February 1, 1962 bulletin indicates that the snow pack on the upper Fraser river watershed was above, to well above, average to that date in the various sampling courses.

Questions



* GOVERNMENT ANNUITIES ADVERTISING, U.S. MAGAZINES

Mr. Meunier: 1.	Is the Department of Labour running advertisements in American magazines on behalf of the annuities division; and, if so, in what magazines, and at what expense?
2.	Has the department considered placing such advertisements in Canadian magazines to bolster this Canadian industry; and, if so, what conclusion was reached?


Richard Devere Thrasher: The answer to part 1 is yes. Advertisements appear in the Canadian editions of Reader's Digest and Times at a cost of $21,065. The answer to part 2 is yes. As a matter of regular policy annuities advertising is placed in Canadian magazines, and during the present fiscal year 12 Canadian magazines are being used.



* VISAS FOR EAST GERMAN SPORTS PARTICIPANTS

Mr. Winch: 1.	Is the clearing of visas to East German participants in international sports affairs a decision of the NATO powers; and, if so, what stand was taken by Canada in this arrival of policy?
2.	Is there a definite understanding by NATO countries, agreed to by Canada, to ban the East Germans travelling in any part of the western world to compete in international sports events?
3.	Is Canada making an official application for the right to hold the next winter Olympics in our country; and, if so, will East German entrants be denied the right to participate?


Mr. Diefenbaker:: 1 and 2. Under existing policy established as a result of the construction of the wall in Berlin last August, whereby the East German authorities put an end to the freedom of travel, temporary travel documents for East Germans are restricted to a few categories, mostly of a compassionate nature. These do not include those the Soviet authorities wish to send to international sporting events. In the circumstances, Canada concurred in these arrangements.
3.	No, the next winter Olympics will be held in 1964 in Austria. With regard to the winter Olympics of 1968 it is hoped that an announcement will be made on this subject in the near future. The difficulties concerning the travel of East Germans have arisen as a result of the construction of the wall in Berlin last August whereby the authorities in the Soviet zone of Germany put an end to freedom of travel. We hope, however, that over the next six years progress will be made toward eliminating these difficulties.



*LAND EXPROPRIATIONS, SARNIA, ONT.

Mr. Godin: 1. Are any expropriations taking place in Sarnia, Ontario, of land to be used by Polymer corporation; and, if so, what use is to be made of the land, and how many properties are involved?
[Mr. Dinsdale.l
2. Have any representations been received from persons that compensation is insufficient; and, if so, what replies have been made?


Raymond Joseph Michael O'Hurley: At the time being there is no appropriation taking place in the city of Sarnia by the Polymer corporation. There is appropriation going on by the city of Sarnia, but there is no arrangement that this property is for the Polymer corporation.



*MR. RUSS GURR

Mr. Nixon: 1.	Has Mr. Russ Gurr of Brandon, Manitoba, been temporarily employed in any capacity by the Department of Northern Affairs and National Resources since January 1, 1961; and, if so, in what capacity, and at what remuneration?
2.	Have any payments been made to Mr. Russ Gurr by the department in the same period; and, if so, in what amount, and for what purpose?


Walter Gilbert Dinsdale: 1.	Yes, as a principal clerk at an annual salary rate of $4,620.
2.	Yes, $1,924. Of this amount $1,540 was for salary and $384 for travelling expenses.



* CANADIAN CONSTITUTION AMENDMENT


Mr. Batten: Did the Minister of Justice send the draft bill entitled an act to provide for the amendment in Canada of the constitution of Canada to the association of Canadian law teachers for comment; and, if not, will the minister give consideration to taking this action?


William Joseph Browne: The draft
bill entitled "An act to provide for the amendment in Canada of the constitution of Canada" was not sent to the association of Canadian law teachers, but copies in English and in French were sent to the deans of all the law schools in Canada. Since the law teachers in Canada have thus been supplied with copies, there was no need to send copies to their association.



*ETOBICOKE TOWNSHIP, ONT.-HOUSING CONSTRUCTION

Mr. Hellyer: 1.	Is the government planning to build approximately 1,110 housing units as part of the federal-provincial housing scheme in Etobicoke township near Thistletown?
2.	When was the land acquired by the federal-provincial partnership?
3.	What is the reason for the delay?
4.	When is it expected that construction will commence?


David James Walker: 1. The federal government and the government of Ontario jointly own approximately 500 acres of land in Etobicoke township near Thistletown. Negotiations are presently under way between C.M.H.C. and

the province of Ontario regarding the use of this land. The municipality of metropolitan Toronto has requested that 1,100 public housing units be constructed on this land. This proposal is now being investigated and preliminary planning is under way. '
2.	The various parcels of land making up the total area were deeded to C.M.H.C. on the following dates: February 5 and 15, 1954; March 4, 1954; June 4 and 23, 1954; December 15, 1955 and June 3, 1958.
3.	There is no delay.
4.	If it is decided to proceed, I hope that construction will commence within a year. Meanwhile planning is to be completed, necessary agreements signed and municipal trunk services made available.



* DISCUSSIONS WITH ICELAND RESPECTING TERRITORIAL WATERS

Mr. Howard: Since April 1, I960, has the government of Canada, or any representative thereof, had any discussions with the government of Iceland, or any representative thereof, relating to the breadth of the territorial sea or proposals for the widening thereof.


John George Diefenbaker: Since the 1960 Geneva law of the sea conference the government has been in contact with a number of countries concerning this problem. For the reasons given in the house on February 7, it is impossible to be more specific at this time.



* APPROPRIATIONS FOR DREDGING, CAMPBELLTON-DALHOUSIE, N.B.

Mr. Michaud: Have moneys been appropriated for dredging at Campbellton and/or Dalhousie, New Brunswick; and, if so, in what amounts, and for what projects?


David James Walker: Provision has been made in the 1962-63 estimates, subject to the approval of parliament, for annual maintenance dredging in front of the deep water wharf at Campbellton, N.B. This will cost about $15,000.
No dredging has been planned at Dalhousie, N.B.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. Racine: Under the winter works program, with respect to each province and for the periods 1960-61 and 1961 to date (a) how many projects have been approved by the federal government (b) what is the actual or estimated cost of such projects (c) how many unemployed, registered as such with employment offices, have thereby been given work?


Richard Devere Thrasher: In view of the large amount of statistical information in the answers to 26207-1-80i
Orders for Returns
several parts of this question, Mr. Speaker, I wonder whether the answer may be taken as read.


Mr. Speaker:: If the answer is extremely voluminous perhaps the parliamentary secretary would ask that the question be made an order for return. I observe what look to be about half a dozen pages. We must have some respect for Hansard.


Richard Devere Thrasher: I ask that it be made an order for return.


Mr. Speaker:: Order for return.


RECIPE BOOKS FOR BUFFALO STEAK
Mr. Herridge: 1.	Has the queen's printer issued a letter stating that recipe books for buffalo steak are available on application to him; and if so (a) how many such letters were sent (b) how many recipe books were printed (c) what is the total cost involved in printing and mailing the letters (d) what is the total cost of the recipe books (e) what is the amount of money expected to be realized by the sale of the recipe books?
2.	Is buffalo meat available for sale; and, if so (a) where (b) what is the cost to the consumer (c) what was the price to the retailer (d) how many pounds of buffalo steak are for sale?


* CIVIL DEFENCE TRAINING PERSONNEL
Mr. McMillan: 1.	How many persons took the civil defence training course in Canada in 1961?
2.	How many were so engaged at the last available date?
3.	How many of this latter number were unemployed when their training started?



SALE OF OLD RAILS BY C.N.R.

[Stage Direction]
Question No. 196
Mr. Brassard (Lapointe):: 1.	Between September 1, 1957, and September 1, 1961, has any department or minister of the government exchanged any correspondence with J. P. Boisjoly Industries Limitee concerning the acquisition by the said company of old rails belonging to the Canadian National Railways located at Ste. Philomene in the county of Chateauguay; and, if so, which department or minister?
2.	Have any of the departments or ministers of the government exchanged any correspondence in this connection; and, if so, which departments or ministers, and what were the terms of the letters sent by the departments concerned?



BUSINESS OF THE HOUSE


Hon. Gordon Churchill (Minister of Veterans Affairs):: On a point of order, I should like to direct the attention of hon. members to the questions we have had today, of which there were 64 on the order paper, 43 of that number being starred questions. This session the rules have been altered and we have reverted to the practice which was customary in the house several years ago, of questions

Inquiries of the Ministry being called on Monday and Wednesday and answered as we have just been doing.
During the last several sessions that practice was discontinued. The questions were not called, and the answers appeared at the back of Hansard. This year we reverted to the old practice so that the answers now appear at the front of Hansard. Consequently the need for starred questions is not as essential as it was during the last few years when by means of the starred question on Wednesdays a member would get his question answered and the answer would appear at the beginning of Hansard.
I would just ask hon. members to consider when placing questions on the order paper whether they really want them to be starred. Today we had three starred questions the answers to which were very long, and a request was made that they should be printed without being read in full.


John Whitney Pickersgill: I feel the occasions are rare enough when I can agree with the leader of the house, but I was a member of the committee on the rules which recommended that this change be made at this session, and I quite agree with the leader of the house that questions which elicit lengthy information might better not be starred, now that we know the information will be available in the front of Hansard anyway.


Frank Howard: Rising on what purports to be a point of order raised by the Minister of Veterans Affairs, may I bring to your notice that surely, inasmuch as starred questions are still recognized as being in order under our amended rules, it is within the discretion of the individual member to decide whether or not he wants to put an asterisk beside his question.


Gordon Minto Churchill: 1 did not question that at all.


Frank Howard: Then why did you rise on a point of order?


Gordon Minto Churchill: There was no other way of raising the matter.


Mr. Speaker:: Before the orders of the day are called it is customary to deal with matters affecting the business of the house, and I think the discussion was in order. It is not a question of right, of course; it is a question of practice, and hon. members have expressed their views.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Hon. L. B. Pearson (Leader of ihe Opposition):: I should like to ask the Prime

Minister whether he would care to comment on a press report to the effect that he indicated in Edmonton on Saturday last that if war broke out Canadian forces would be armed with nuclear weapons.


John George Diefenbaker: The statement I made the other day in no way represented a change of viewpoint on the part of the government of this country, and I hope the Leader of the Opposition would agree that if war came, should nuclear weapons be used against us Canadian troops participating should not be denied the right to use nuclear weapons.


Some hon. Members:: Hear, hear.


John George Diefenbaker: What I stated was but a repetition of what has been said on previous occasions. I would simply refer the house to what I stated on November 24, 1960, when speaking to the Canadian club of Ottawa; on August 15, 1961, when speaking in Halifax to the Canadian Weekly Newspapers Association; and again, on October 6, 1961 when Dr. Thomson and those associated with him in the Canadian committee for the control of radiation hazards made representations to the government.
We take the stand that in the interests of disarmament everything must be done to assure success if it can be attained, and that the nuclear family should not be increased so long as there is any possibility of disarmament among the nations of the world. That has been our view throughout; that was the reason for our vote on the Swedish resolution which came before the United Nations.


Lester Bowles Pearson: In view of what the Prime Minister has said, to the effect that nuclear arms would be in the hands of Canadian forces if war broke out and nuclear arms were used against them-I think I am right in my interpretation of what the right hon. gentleman said-may I ask whether such weapons would be in the hands of Canadian forces before the outbreak of war?


John George Diefenbaker: I referred to the outbreak of war and said that in the event that nuclear war was launched, nuclear weapons should be placed in the possession of Canadians.


Hon. Paul Marlin (Essex Easl):: May I ask a
supplementary question. Could these weapons be used without the approval of the United States authorities?


John George Diefenbaker: Our views in that regard were set forth at length in February, 1959. At that time I said-and I am simply summarizing the remarks I made in the house-that in the event we should decide to make nuclear weapons available it would be necessary to have joint control on the part of Canada and

the United States. That attitude, of course, has not been generally accepted. If I understand the Leader of the Opposition aright, some weeks ago he took the stand that he objected at any time to joint control, but he would be willing to have the United States store nuclear warheads in Canada.
That view we have never held. Our view is that at the moment this is hypothetical and will continue to be so as long as disarmament is to the fore. But should it be decided in the light of Canadian armament needs and defence responsibility that nuclear weapons are to be had at any time, joint control is of the essence of the stand we have taken.


Lester Bowles Pearson: It is not possible, of course, in a question to remove the misunderstanding which the Prime Minister has created about my position in this matter. I ask the Prime Minister, therefore, this question. In view of the constitutional position of the United States, and in view of recent statements of the President of that country, how does the Prime Minister propose to bring about this joint control?


John George Diefenbaker: Mr. Speaker, the hon. gentleman knows very well that so long as the law of the United States is as it is at present, joint control is impossible.


Lester Bowles Pearson: Then we cannot have the weapons.


John George Diefenbaker: What I have stated is exactly the position of affairs. We have stated that until the United States makes joint control available, we do not intend to go further than we have unless war breaks out, at which time we hope to have available to Canadians the necessary nuclear weapons. That is much clearer than the evasive policy of the Leader of the Opposition.


Lester Bowles Pearson: In view of the Prime Minister's recognition of the constitutional difficulty, and in view of what he has just said about the necessity for joint control irrespective of that constitutional difficulty, how then is the Prime Minister going to ensure that nuclear weapons are in the hands of Canadian forces if war breaks out?


Mr. Speaker:: There has been a substantial exchange on this-


Lester Bowles Pearson: It is an important matter.


Mr. Speaker:: -important matter. If it cannot be clarified in five supplementary questions I think it might better be deferred to be the subject of a debate.
Inquiries of the Ministry



EXTERNAL AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, I wish to address an important question to the Prime Minister, as one leader to another. In view of the report in the Globe and Mail of February 26 to the effect that Britain's foreign secretary has stated his desire to arrive at a modus vivendi with the East German regime, would the Prime Minister inform the house whether the Canadian government will second this hopeful endeavour to lessen tensions in central Europe?


John George Diefenbaker: Mr. Speaker, as one leader to another may I thank the hon. gentleman for having given me notice of this question in order to permit of a full and complete answer. I have seen only press reports of what Lord Home is alleged to have said about the problem of Berlin. The hon. member will appreciate that it is difficult for me to attempt to answer his question on the basis of such reports.
However, as has been said on other occasions, the Canadian government has consistently taken the stand that allied troops should remain in West Berlin as guarantors of the freedom of the people of West Berlin. Our assessment coincides with the British foreign secretary's statement that the Soviet union would like to obtain some degree of recognition of the regime it has created in East Germany. It will be the task of the west in the months ahead to seek through negotiation the achievement of the Latin expression which the hon. gentleman used, a modus vivendi which will respect the essential interests both of the west and of the U.S.S.R. in the Berlin problem. The Canadian government will do everything possible to assist in the fulfillment of this task.


PEACE RESEARCH INSTITUTE
[Stage Direction]
On the orders of the day:
Mr. Walter Pitman (Peterborough):: Mr. Speaker, I wish to address a question to the Minister of National Defence arising out of a Canadian Press report of a press conference at which the minister was asked whether he would lend either financial or moral support to any peace research institute, to which he was reported to reply "I don't plan looking into it". Could the minister say whether this is a true statement of the attitude of

Inquiries of the Ministry the government in regard to the peace research institute now being organized?


Douglas Scott Harkness: Mr. Speaker, I think my actual reply to that question was that there are a large number of organizations in this and other countries whose avowed purpose is the pursuit of peace, and I thought they should pursue their activities without the Department of National Defence taking any active part therein.


LABOUR CONDITIONS
[Stage Direction]
On the orders of the day:
Mr. M. D. Morton (Davenport):: Mr. Speaker, I wish to direct a question to the Minister of Labour. Can the minister advise whether he has received a report from the clerk of the city of Toronto advising that the city council has asked that the federal government extend the municipal winter works incentive program from April 30 to May 31 because of the severe cold weather which has been experienced, and because several projects in the 1961-62 program may not be completed by that date? If so, what decision has the government made on this matter?


Hon. Michael Starr (Minister of Labour):: Mr. Speaker, I did receive a letter dated February 13 requesting that the government consider extending the municipal winter works program from April 30 to May 31 of this year, in view of the severe cold weather and heavy snowfalls as a result of which many of these projects could not be carried on. It has been decided to extend this date to May 31, and all the provinces will be so advised.


TRANS-CANADA AIR LINES REQUEST FOR REVIEW OF ANNOUNCED FARE INCREASES
[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Port Arihur):: Mr. Speaker, I should like to ask the Minister of Transport a question relating to the announcement of T.C.A. that substantial fare increases will take effect on April 1. In view of the announcement of the president of T.C.A. that this increase raise is to meet a deficit, and his previous evidence that such deficits resulted from franchise extensions given C.P.A. two years ago, has the minister given consideration to a review of this apparently destructive competition?


Léon Balcer: Mr. Speaker, while I do not accept all of the premises in my hon. friend's question, my answer is no.


Douglas Mason Fisher: A supplementary question. Has the government yet had before it for approval the fare increases referred to?


Léon Balcer: Mr. Speaker, this is a matter for the management of T.C.A.'s decision.


Douglas Mason Fisher: A further supplementary question. Does the minister's answer indicate there will be no review of this fare increase by the minister and the government?


Léon Balcer: Mr. Speaker, this is an internal decision of the board of directors of T.C.A. Of course the annual report of T.C.A. and its budget for 1962 will be reviewed by the standing committee that reviews the affairs of the C.N.R. and T.C.A. These documents will be the subject of inquiry on the part of all hon. members of that committee.


CROP INSURANCE
[Stage Direction]
On the orders of the day:
John George Diefenbaker: Mr. Speaker, on Friday last, as reported at page 1195 of Hansard, the hon. member for Assiniboia asked the following question:
As an encouragement to the provinces to make greater use of the Crop Insurance Act. can the Prime Minister say whether consultations have been held between officials of the federal Department of Agriculture and the provincial departments of agriculture to discuss the question of reinsurance of losses under the Crop Insurance Act?
Proposals concerning reinsurance of losses under the Crop Insurance Act have been received by the Department of Agriculture from the governments of the provinces of Manitoba and Saskatchewan. Discussions up to the present time have been between officials on an informal basis.


WHEAT-REQUEST FOR COMMENT ON GATT DISCUSSIONS
[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: Mr. Speaker, I am not sure whether I should address this question to the Minister of Finance or the Minister of Trade and Commerce, but perhaps the appropriate minister might care to comment on discussions which are reported to have taken place at GATT in Geneva last week on a new

world wheat arrangement, and which are reported to have been adjourned last week in disagreement.


Donald Methuen Fleming: Mr. Speaker, I think the Leader of the Opposition should have a third string to his bow, because he is talking about wheat and that is a question for the Minister of Agriculture. As far as GATT is concerned, seeing that the hon. gentleman is asking about negotiations at Geneva concerning wheat, that question will be answered in due course on behalf of the Minister of Agriculture.


FRASER VALLEY, B.C.-INQUIRY AS TO CONSUL- TATIONS TO AVERT DAMAGE
[Stage Direction]
On the orders of the day:
Frank Howard: Mr. Speaker, I wish to direct a question to the Minister of Northern Affairs and National Resources arising out of his answer to question No. 197, to the effect that the controller of water rights for the province of British Columbia indicated that as of February 1, 1962 the snow pack on the upper Fraser was average to above average for that date. Has the province of British Columbia been in consultation with the minister's department with respect to joint participation in a program to avert the possibility of damage in the lower Fraser valley in the spring months?


Walter Gilbert Dinsdale: Mr. Speaker, the answer is no.


COMBINES
[Stage Direction]
On the orders of the day:
William Joseph Browne: Mr. Speaker, on Wednesday, February 21 the hon. member for Skeena directed a question to the Minister of Justice asking whether the minister could indicate when he might be in a position to table the report of the restrictive trade practices commission relating to the pricing and selling policies of certain pharmaceutical houses. I now have the reply as follows.
I have had inquiries made as to when the report of the restrictive trade practices commission is likely to be received, and am advised that while the matter is being pressed forward with all possible dispatch, it is likely to be some time yet before the report is made.
Alleged Lack of Economic Growth IMMIGRATION


EFFECT OF NEW REGULATIONS ON ENTRY OF ORIENTALS
[Stage Direction]
On the orders of the day:
Douglas Mason Fisher: I should like to ask the Minister of Citizenship and Immigration whether she has any information on the case revealed in the Winnipeg Free Press of Saturday, wherein a Canadian citizen of Chinese origin charges that the new regulations as now applied have absolutely no effect in changing the role of orientals wishing to come to Canada.


Ellen Louks Fairclough: I have not seen the article referred to, Mr. Speaker. However, if it is as quoted, the information contained therein is erroneous.


John Whitney Pickersgill: I should like to put a question to the Minister of Citizenship and Immigration. Can she tell us offhand now or give the information later as to how many Chinese unrelated to Canadian citizens of Chinese origin have been admitted to Canada under the new regulations?


An hon. Member:: Order paper.


Ellen Louks Fairclough: I am sure the hon. member does not expect a reply to that question, Mr. Speaker. He has had sufficient experience in this department to know full well that it takes longer than from February 1 to February 26 to process an application.

Hon. Donald M. Fleming (Minister of
Finance) moved that the house go into committee of supply.


ALLEGED LACK OF ECONOMIC GROWTH
Miss Judy V. LaMarsh (Niagara Falls):: Mr. Speaker, this is a traditional opportunity for those of us in opposition to raise some matters of great importance dealing with the Canadian economy. I therefore take that opportunity today in order to deal with what will be the theme in the next election and what is the greatest issue before the people today. The Prime Minister has suggested several possible themes for the next general election such as free enterprise versus socialism, senate reform and things of that nature. This is, of course, an attempt to blur and becloud the basic issues before the country, in an attempt to divert people's attention from the shortcomings of this government in meeting emerging problems.

Alleged Lack of Economic Growth
I cannot during this debate discuss all the essential problems such as social security and national unity which will have to be faced and solved soon. Apart from the threat to world peace, however, the paramount issue is the lack of economic growth, the nation's nearly stagnant economy. Without adequate and planned growth a relatively large number of our Canadian workers will remain unemployed, the farmers will accumulate surpluses, private enterprise will continue in hesitancy; municipalities will deteriorate through being unable to improve their local services, and other levels of government will find it increasingly difficult to extend our social security system to other areas of collective risks. In other words, economic growth is essential not only to a rising standard of living but also to the progress and improvement of all the other aspects of our national life.
Economic growth therefore must be the key domestic issue of the next general election. In the economic debate that has taken place in Canada in recent years the Liberal party has taken and is taking a realistic and responsible attitude. We are saying that the Canadian economy has not grown as it should have grown since 1957, and that the government has failed to take appropriate action to correct the situation. We in contrast are putting forward a concrete program to promote rapid and balanced growth.
What is the attitude of this Conservative government? They make the preposterous claim that the Liberal party is selling Canada short when it underlines the lack of economic growth. They say that Canadians never had it so good, and they apparently do not propose to do anything except to publicize their meagre accomplishments. This charge that we on this side are selling Canada short reminds me of another economic debate which took place during the last presidential campaign in the United States, and of Mr. Nixon's position in that debate as described by Meg Greenfield in an article entitled "The Prose of Richard M. Nixon" which appeared in The Reporter on September 29, 1960. This is what she had to say:
The identification of his opponents with communism is generally considered to be a chapter from Nixon's past. In not very subtle ways, however, he has managed to assert throughout the last two years that those who have criticized him or the Eisenhower administration or the Republican party on matters ranging from the economy to national defence have not in fact attacked those policies but have attacked America itself. The implication is either that they have suggested we adopt a communist system, or, when this won't do, that they have not criticized a policy but a basic American institution. "It's time to stop selling America short" appears to be the grand theme of


his campaign for the presidency, suggesting as it does some unspecific deficiency of patriotism in his opponents.
That surely has a familiar ring to hon. members of this house. I am quite sure that the tactics used by Mr. Nixon in the United States will not be more successful in Canada, as Canadians know too well their own economic difficulties to accept the rosy picture that the Conservatives are attempting to present to them.
Let us now look at the facts, Mr. Speaker. I might remind hon. members, if they do not choose to listen, that I am in that rather special category in which I have all day to speak.


Some hon. Members:: Oh, oh.


Mr. Graffley:: Oh, no; have mercy on us.


Mr. Speaker:: Order. The hon. member has indicated her proper position when she says she has all day to speak. I trust that those who are listening will give their early attention to what she has to say.


Julia Verlyn (Judy) LaMarsh: Let us look at the facts, Mr. Speaker. The Conservatives claim that our economic troubles are over simply because the Canadian economy is going through another cyclical upswing in business. There is nothing exceptional about the present recovery. It is due to the normal pattern of change in inventories, and is just another phase of the short cycle.
In March, 1961 my leader was the first in this house to say that the 1960 recession was over because the process of inventory liquidation was then completed. In the latter part of 1961 economic conditions began to improve, and several experts forecast an increase of about 6 per cent in the gross national product at market prices for 1962. This increase would be about the same as that in 1959, when unemployment remained at an average rate of 6 per cent. This is certainly nothing to boast about for a period of peak activity.
Indeed, the experts also predict that another recession will begin at the end of 1962 or at the beginning of 1963. Again this is the normal pattern of the short cycle. Recessions tend to appear every three years: in 1954, in 1957, and in 1960. It is quite normal, therefore, to expect the beginning of another one during the next fiscal year. I suggest, Mr. Speaker, that this is the appropriate time for the government to anticipate such an unfortunate event and prepare plans now to cope with it before it comes. This is exactly what President Kennedy is doing in the United States.
The Leader of the Opposition, it may be recalled, made the same suggestion to the government on April 12, 1960, in this house

when he warned that the Canadian economy was on the eve of another recession. The government did not accept his warning then, and it blindly refused to plan accordingly. As a matter of fact, here is what the Minister of Finance had to say at that time as found at page 3167 of Hansard of April 12, 1960:
The Leader of the Opposition was so anxious this afternoon to get everybody talking recession with him that he was in effect asking the Minister of Finance what preparations he was making for the next recession. The best preparation that can be made for the next recession is to continue the present government in office.
He continued:
That is the surest guarantee of avoiding a recession.
The Minister of Finance was wrong again. The recession began during the second quarter of 1960, but the government did not even recognize its existence before the very end of that year. It did not recognize the problem of increasing unemployment. As a matter of fact one of the ministers of the crown, as I recall, said that it would melt with the snow.


John Whitney Pickersgill: The Minister of Finance.


Julia Verlyn (Judy) LaMarsh: Furthermore, the government even avoided the use of the word in the throne speech debate of November, 1960. I hope that same mistake will not be made this time, and that the Minister of Finance will be realistic enough to anticipate this new danger and act accordingly. I hope that this time he will do more than just sit passively and watch it happen.
Moreover, this current recovery is not without its weaknesses. I do not see how we can be satisfied with the present economic situation when, at a cyclical peak, the rate of unemployment is 8.5 per cent, and when this very poor result has been obtained because of our labour force remaining stable, a factor which is quite abnormal. I have been truly shocked since the opening of this parliament to see the self-satisfaction of the government over the problem of unemployment, as though the problem no longer existed, although almost half a million Canadians still remain unemployed.
The condition of Canadian agriculture is certainly not bright. The dairy industry, which is so important in eastern Canada, is in deep difficulties. This can best be illustrated by the tremendous butter surplus that has been accumulating in recent years. There were widespread rumours last year that the government would announce a new policy, but as usual it has not dared to come to grips with the issue. The Prime Minister has announced instead that the dairy industry
Alleged Lack of Economic Growth will have to wait until May for a policy statement. Meanwhile it has to live under conditions of complete uncertainty as to its immediate future.
In the prairie provinces, Mr. Speaker, net farm income declined by about 45 per cent in 1961 compared with 1960, according to the most recent figures published by the dominion bureau of statistics. This tragic decline was caused by the reduction in production of grain crops in 1961 brought about by the terrible losses of last summer's drought, and the consequent drop in the year end inventories of grain on farms. We are also told that the outlook for 1962 is not very bright because of a lack of soil moisture, and that the supplies as at January 1 of this year were 465.3 million bushels compared with 745.9 million last year. Our wheat surplus may soon be completely eliminated, but it will not be to the advantage of Canadian wheat producers. We are committed to new sales abroad at a time when we may not be able to produce enough to fulfil our traditional commitments.
The current mild and temporary recovery reveals the more fundamental weaknesses of the Canadian economy. When we look at our long term situation it becomes evident that since 1956 our economy has simply failed to grow. This lack of growth appears clearly when we compare recent figures with the previous period and with the requirements of full employment. You say, what is the evidence? From 1950 to 1956 the average annual increase in our gross national product in constant dollars was 6 per cent. From 1957 to 1961 it has been 1.5 per cent. In 1956, compared with 1950, the volume of our gross national product on a per capita basis had increased by 22 per cent; but in 1961, compared with 1956, it had declined by more than 4 per cent.
From 1950 to 1957 total capital expenditures in constant dollars increased by 62 per cent, but since 1957 they have declined by 12 per cent. During these last self-same five years business capital expenditures in constant dollars have declined by almost 25 per cent. From 1950 to 1956 the average rate of unemployment was 3 per cent. Since 1957 it has exceeded 6 per cent. The average level of unemployment in 1961 was the highest in the post-war period, 7.2 per cent, in spite of the fact that net immigration estimated at 13,000-that is, only 13,000 more people coming into the country than those going out of it-was at its lowest post-war level.
Those are the basic facts which describe the long term situation of the Canadian economy. It is not a rosy picture, but it is

Alleged Lack of Economic Growth a true picture. This is not glooming and dooming; this is a responsible discussion of the facts.
There are two other important aspects of this situation which must be mentioned. First, our export trade which is so vital to us is going through a revolutionary period. More than 50 per cent of the increase in our trade went to communist countries in the first nine months of 1961. This is a new but very unstable trade diversion. No one can tell how long such markets will continue. Moreover, the emergence of new trade blocs represents a challenge which the government is still refusing to face. The government, rather than embracing the idea of such potentially great trade developments, has hung back and consistently played the obstructionist. Second, it has been estimated that we will have to have one million additional new jobs in Canada during the first half of the 1960's in order to achieve reasonable levels of employment.
Since the present government came into office our economy has slowed down. While the government lauds itself because more people are employed, it suppresses any real discussion of the fact that we are barely holding our own and creating nowhere near sufficient jobs to take care of the present, much less the future. The government would have us believe that they are doing everything possible to alleviate unemployment, and that since nothing more can be done the whole matter might better be ignored. It has attempted to fix responsibility for this situation upon us, upon a prior administration. Who can forget the biggest single group in Canada who were suddenly thrust out of work in 1958 at the instance of this government, that skilled technical team at Malton building the Arrow and the Orenda engine, some 16,000 Canadians who at one blow were placed out of work? With that same blow Canada suffered the loss of a complex of highly skilled people such as we had never before put together and may never again. The government cast them away. Most of them left for the United States, which realizes the necessity for the development of such a force of scientists and technicians. This is what an editorial in the February issue of Aircraft magazine has to say, speaking of a young man who was part of the Avro team:
James Chamberlin is a Canadian now living and working in the United States. It is ironical that three years alter his departure from Canada his name may become nationally known. It is possible that with an election approaching the case of Jim Chamberlin may become a cause celebre, for he is a symbol of the growing export of brains that Canada has supplied to the United States in the last few years.

Mr. Chamberlin has recently been named by NASA as project manager for project Gemini. Project Gemini is the next major man in space project by the United States and involves putting two men in orbit in separate capsules which will rendezvous while in orbit. The fact that a man who has not even been in the United States long enough to qualify for citizenship would be assigned by NASA to manage a project which means so much to U.S. international prestige is an indication of the high regard with which he is held in U.S. scientific and engineering circles. Too bad Canada couldn't have held Jim Chamberlin and others like him.
When the Prime Minister asks, as he did in the past few days, whether we are to fight the next world war with bows and arrows, the people of the country at least know, even if they do not know whether a Bomarc without a warhead is equivalent to an unstrung bow, that we will not be fighting with Arrows, and they know who are responsible for that.
The cost to Canadians of the slowdown in our economic pace is $14 billion. That is the difference between our actual production in the last four and a half years and the production we would have had if the economic growth of previous years had continued. The cost is nearly $800 worth of goods and services for every person in the country. The cost for a family of four is over $3,000, and the loss has been getting bigger every year. In 1961 alone it was about $5 billion, that is $100 million a week or nearly $600,000 for every hour of the day and $10,000 for every minute. Worse still, the slowdown means a loss of 300,000 jobs for Canadians, extra jobs which would now exist if economic growth in this country had continued since 1957 as it was before.
Third, then, Mr. Speaker, the fiscal and monetary policies of this government have done nothing to assist and, indeed, much to harm economic development. May I quote from an editorial in the Winnipeg Free Press of February 22, 1962:
In Toronto, the citadel of the Conservative party, the Globe and Mail demands an early budget and a full disclosure of the financial facts both for the enlightenment of the Canadian people and for the reassurance of foreigners since "in the last year or so Canada's credit and standing abroad have deteriorated. The heavy national deficit, the long delay in bringing down the 1961 budget, and the rancorous quarrel between the government and the former governor of the Bank of Canada, Mr. James Coyne, have created doubts about our financial responsibility." Lacking an early budget, says the Globe and Mail, "the result could be a sharp decline in much needed foreign investment."
Those are strong words from a government supporter but the Montreal Gazette, Canada's oldest and most reliable Conservative organ, appears to be more alarmed than its Toronto contemporary. It says:
The present situation, when both federal and provincial governments are running up deficits and

debts cannot continue .. . Obviously everybody cannot go on spending above revenues indefinitely without the day of reckoning being terribly cruel.
These, then, are the costs of Canada's wasted years; the years of Tory talk instead of action, of mismanagement instead of purposeful government. As I said before, economic growth will be the key domestic issue during the next election campaign. This time the Conservatives will be judged not on a vision but on their record, a record of wasted years as compared with the period of progress and development during the former Liberal administration.
In contrast, we on this side of the house are presenting an over-all program designed to meet the new problems and the changes which have recently emerged. We recommend a new and freer trade policy. The Leader of the Opposition, Mr. Speaker, has been in the forefront of those proposing new trade alliances in free trade areas such as the Atlantic community. We have, in addition, special programs to help those domestic industries which will have to adjust to freer trade. There are many such which have been undertaken in the various E.C.M. countries.
If I may, I should like to cite some of the procedures which are used in the various countries. I should like to point out that we are well aware of the fact that freer trade might have an adverse effect on some of our domestic industries, but that same fear was widespread in European countries and did not materialize. The governments of those countries applied some differing types of solutions through their budgets and through governmental action to adjust their domestic industries to this new trading community.
In Italy, Mr. Speaker, there is something called the fund for the south, which grants credits to small and medium sized industries for construction of new plants and modernization of existing ones. These loans bear 3 per cent interest for 15 years and cover 70 per cent of the cost of the project. Most hon. members will know that the southern part of Italy is much less developed than the northern and more industrialized part. Tax concessions in that country are allowed on investments in specific areas including exemptions of income tax, turnover tax, corporate tax, registration and mortgage taxes. Material and machinery in these regions are exempted from customs duties. An exemption from corporate income tax on a maximum of 50 per cent of corporate profits is granted, provided the tax exempt portion is used for new investment or to reactivate industrial plants. Municipal governments may grant exemption from all or part of taxes, such as commodity tax, consumption and land taxes,
Alleged Lack of Economic Growth due to them up to August, 1967. Lands required for new industries may be expropriated and made available at their agricultural rather than their industrial value.
In the Netherlands certain regions have been designated as development areas. Special provisions apply to investments in these localities. Subsidies based on additional useful floor area of new factories provide up to one half the cost of purchasing industrial sites. To qualify an entrepreneur must agree in principle to employ a specified number of male employees. Up to one third of the cost of equipment can be written off at an accelerated rate. A company is allowed to deduct in any one year losses sustained in the six preceding years, and new industries may carry forward losses until they are completely absorbed by subsequent profits.
In Luxembourg the minister of finance is vested with power to extend substantial reductions in tax rates in order to attract new industries. Incentives take the form of accelerated depreciation, loans at low interest rates, direct subsidies for underindustrialized areas to promote the building of new plants, and lease-purchase schemes for industrial buildings.
In France, Mr. Speaker, some of these procedures were used. During the post-war period two modernization and equipment plans have been implemented. A third one is to become operative this year. Under it accelerated depreciation is allowed on a specific range of assets required for updating French plants. Companies can charge against taxable income the full amount of investment in companies and associations approved by the government whose functions are to assist members in modernization. Expenditure on scientific research is encouraged by an initial depreciation allowance of 50 per cent, and contributions to scientific organizations are allowable up to 2 per cent of turnover.
In Belgium state loans at reduced rates of interest are made available to industry through approved credit organizations, which in turn receive state subsidies and guarantees. Government built factories are sold or leased back to industries. Such locations are exempt from real estate taxes for five years. About 30 per cent of investments in industrial land, buildings and equipment can be written off against corporate taxes over three years. The capital gains tax does not apply to returns on investment in development areas.
In Germany most of the aid to distressed areas applies only to Berlin. However, enterprises situated on or near the eastern frontier are granted accelerated depreciation.
In Greece, an associate member of the E.C.M., price advantages of up to 8 per cent
1258	HOUSE OF
Alleged Lack of Economic Growth in bidding for government contracts, reduction in turnover taxes, exemption from custom taxes on machinery, are all available to companies operating in designated areas. Net profits destined for reinvestment in business attract a 40 per cent to 80 per cent tax exemptions.
These, then, are only some of the ways in which government has assisted in the E.C.M. countries.


Murray Douglas Morton: May I ask the hon. lady a question? Would she indicate to the house in what period of time these inducements were given to industry, what year?


Julia Verlyn (Judy) LaMarsh: They have been given in various years since the beginning of the E.C.M. up to the present, and in different countries they have different periods of time relating to different industries.
In addition, this party has a program for regional recovery. We propose to set up an agency of the federal government which will be charged with the rehabilitation of problem areas. We of the Liberal party feel that to meet today's needs it is necessary to establish a Canadian standard of development opportunity. A new Liberal government will end1 the situation in which some Canadians have much poorer opportunities than others because they happen to live in areas whose resources have never been developed or whose industries are declining.
This agency will be responsible to one minister. It will identify the areas where a special thrust for development is needed, and suggest effective action programs. These programs will be examined with the provinces and the municipalities, with the industries concerned, with the federal departments and1 with local representatives. The programs will be backed by good administration, as well as by the necessary money.
Liberal action to meet the special requirements of development areas means capital grants for basic development projects such as roads, power generation and transmission, and other public investments. It means that private industry will be helped to get things moving, and in that regard tax incentives will be offered to companies which expand or modernize their operations, or which start new industries in the development areas. It means such things as federal public works programs. It means a municipal loan fund to provide capital for municipal works and services. It means that we will assist or aid in urban renewal and rural development and will make more capital available for clearing slums, for improving farmland, for reforestation, for development of recreational and tourist areas and for improving rural housing. Federal government purchases will help firms
	'

in the development areas, and the Liberal program for vocational training will be particularly designed to help workers displaced from declining industries so they can more easily move to new or expanding industries close to home.
In addition to all this a new Liberal government will provide an industrial development bank to operate as a vigorous agency for Canadian development. Another proposal which we have set forward is that dealing with urban redevelopment and the municipal loan fund, to which I have just made reference. A municipal loan fund is something which this country has long desired. It is understood by the Liberal party that one does deal from the federal government to the municipal governments, that they are the creatures of the provinces and must be dealt with through the provincial governments. However, our answer is to set up a municipal loan fund, and we believe that fund should be organized in consultation with the provinces and municipal representatives so that it will not conflict with existing sources of capital. It will provide loans for sound municipal improvements, of which provincial governments approve but for which capital is unobtainable at reasonable terms from existing Canadian sources. These loans will mean that municipalities can meet our great backlog of municipal requirements. They will create new jobs all across Canada and help to get our economy moving again on sound projects.
In so far as urban renewal and urban redevelopment are concerned, all hon. members know that many of our big cities need special development measures. They have slum areas where overcrowding and poor housing breed ill health, family tension, crime and juvenile delinquency; where perhaps adults now cannot live well and children cannot get a proper start on the road to good citizenship. We believe that no Canadian family should have to live in those conditions. We all suffer in health and amenities because of the pollution of city air and water supplies. Our surroundings are made ugly by urban blight. We believe we have to attack these evils, and a Liberal government will attack them and will work in co-operation with the provinces and urban municipalities.
In addition we have a full program for government planning. Now, before I hear any outcry about the use of such words, I hasten to add that such planning is the answer not on the basis of socialism but on the basis of co-operation between government and private enterprise. Mr. Pearson and the Liberal party have long recommended the establishment of an economic advisory council.
Mr. Graff fey: You are adopting all our policies.


Julia Verlyn (Judy) LaMarsh: We have the conviction that such a council should be composed of representatives of labour, industry, agriculture and government. The council's function would be to find out and analyse what is going on in the country; to study what is planned in all types of industry and in all the regions of Canada; to study such major problems as automation; to investigate economic trends; to publish outlook reports and, finally, to make recommendations to the government which in our system has, and must retain, the responsibility for policy and action.
The studies and reports prepared by the council would enable the government to secure a detailed and objective picture of the whole economy; to know its problems and its potential, and to assess its performance in the light of that knowledge. With such information the government would be in a better position to implement effective policies designed to reduce the gap between the potential and the actual performance of our economy. Private business would be in a position to use the targets and the forecasts prepared by the economic council for its own guidance. Government and business together would be able to take a reasoned view of our economic needs and the programs required to meet those needs. This would lead to better understanding and more effective co-ordination between the private and the public sectors of our economy.
A moment ago an hon. member said that what I was suggesting, an economic advisory council, was comparable to the national productive council which was set up last year. Nothing could be further from the truth. Some indication of that fact is that the United States has a national productivity council, yet the new President of the United States recently found it necessary to set up something very close to what the hon. member for Algoma East has been suggesting. That was a new economic council which is called the president's council of economic advisors. In the United States it was found necessary to have both, and of the two the more important has been the president's council. Just contrast the lethargic position of this government with the hustle of our neighbours in the United States.
I suggest that hon. members take a look at the periodical U.S. News and World Report of February 19 last, in which there is an article entitled "New Tools to Control Booms and Slumps". It contains the following:
Kennedy aides have been instructed to draw up a broad, new plan to control the economy. They have been told to use any and all devices to nudge, stimulate, goad, divert or restrict economic activities of all kinds.
Alleged Lack of Economic Growth
The chief planners are the president's council of economic advisers and a new staff of economic analysts and planners, just created in the treasury and directed by under secretary Roosa.
Some of the tools which are in use in the United States, which have been recommended by President Kennedy, include a bold use of the federal budget and the national debt to cut rates of income tax when a recession threatens, and a speed up of public spending when unemployment rises. The President has already asked congress for emergency powers to make temporary tax cuts, and for broad powers to ease trade negotiations with other countries. He has requested the establishment of a department of urban affairs to spend more than $4 billion a year for public housing, a federal mortgage program, community facilities and slum clearance, with plans to expand later to such fields as mass transport, education, air pollution control and water supplies.
That is the type of planning which we on this side mean when we say we have the answer. To those who think it has not been proven nor will it work let me quote from something which was said by probably one of the greatest of modern thinking Canadian planners and builders, the late Hon. C. D. Howe:
If our national development had been left entirely to private enterprise, Canada would not have attained its present status as a nation. And unless government continues to take a lead by well planned initiatives, guidance and regulation, it will not continue to develop as it should.
These, then, are Canada's wasted years. A stagnant economy is inexcusable for a country which possesses such great national resources together with a vibrant, forward looking people born to live in freedom. It is not necessary, and the people know that. A new Liberal government will provide the leadership, restore the confidence, and undertake the practical policies that will get the economy moving.
Mr. Speaker, I move, seconded by the hon. member for Welland (Mr. McMillan):
That all the words after the word "that" be deleted and the following substituted therefor:
"this house is of the opinion that immediate consideration should be given to the development of policies that would ensure an adequate rate of growth in the Canadian economy."


Mr. Speaker:: If no one wishes to comment on the proposed amendment-I have in mind the form of the amendment-I will put it to the house.


Herbert Wilfred Herridge: It is
always a delight and a pleasure to listen to the sweet and mellow voice of the handsome and tender hearted lady member for Niagara Falls (Miss LaMarsh). However, I must say
1260	HOUSE OF
Alleged Lack of Economic Growth that we have some criticism to make of her proposals and, because she is such a nice lady, we are really sorry she is being misled on this question.
To illustrate the effect which this party has had on Canadian public opinion throughout the country, may I point out that the Conservatives are beginning to steal our slogans. They have already stolen one for the coming election, "Social justice for all". That has been our slogan for many, many years. Now the Liberals are beginning to steal our criticisms and even our language to some extent.


An hon. Member:: Even the hon. member for Assiniboia.


Herbert Wilfred Herridge: No, no. They do not steal in that case; they simply adopt. The Liberals are stealing our criticism and using our language, but they have not stolen our program. Do not let anyone be under any illusion in that respect.
Before I proceed to the main substance of my speech, perhaps I may say that speakers for an opposition group such as this must live in a certain atmosphere of anticipation concerning the amendment on the motion to go into supply. The hon. lady, in the course of her well delivered speech, said in the first instance that economic growth is essential for many reasons, hence it must be a major domestic issue in the coming election. We agree with that statement. It is true. That is our language. Then she said the Liberals have concrete plans to provide for such growth. We are waiting to see whether, later, members of the official opposition will be able to list any details of such plans so that we might know what they are.
Then the hon. lady said the Conservatives paint too rosy a picture. Well, we can agree on that. I am trying to indicate the things upon which we can agree in order to show how fair and unprejudiced we are. I may say that all my life I have found it very painful indeed to disagree with a lady, so hon. members can understand my situation this afternoon. Then the hon. lady said, apparently in an implied criticism of the wheat deals with China, that the government had committed itself to future deliveries of wheat to such an extent that we might not be able to make deliveries to our traditional markets. We in this group would not fear the possibility that we might not be able to make deliveries to our traditional markets. What we say is, let us stimulate production and let the farmers increase production so as to meet not only the demands of our traditional markets but the demands of all countries which desire our foodstuffs.


Further, the hon. lady went on to say we should need a million new jobs by 1965. I think we can all agree with that statement, so once again we are in accord. She made some comment about weeping and wailing over a lack of growth. I could not quite understand who the hon. member thought was doing the weeping and wailing. Certainly it was not any member of this group. We deplore conditions which are not satisfactory, but we do not weep and wail; we advance ideas and programs to try to improve the situation.
Since the founding of the New Democratic party the Liberal party has adopted so much of our program and vocabulary, as well as our parliamentary leader, that the Canadian people must wonder whether the Liberal party is altering its basic philosophy of ensuring, as a government, that big business maintains its unfettered control over our economy and arbitrarily dictates the standards of living of the people of Canada at the expense of consumers and producers.
We in this group base our policies on a few simple statements. We believe that every Canadian child, regardless of where that child may live or the economic situation of its parents, is entitled to all the education it is capable of receiving with advantage. We believe that every able bodied adult who is willing and able to work should have guaranteed employment. We believe that all the people of Canada should have protection against the hazards of illness or disease or accident of any kind or extent without their economic security or their savings or their future being imperilled. We believe that the country is responsible for the care of the disabled and for those who are unable to work on account of disability. We think they should be cared for at the expense of all of us and given security with a measure of comfort. We also believe that our older citizens should be able to enjoy their retirement with security and also with a measure of comfort.


William Heward Grafftey: Are you against sin?


Herbert Wilfred Herridge: I see that the hon. and active member for Brome-Missisquoi, where they raise ducks and, apparently, duckies, is interrupting me but it appears that at heart he is sympathetic to my views.
The Liberal party is attempting to convey the idea that it will provide planning in Canada. Hon. members will notice how popular this word "planning" has become. The Minister of Finance who, I notice, is listening attentively to my remarks, will remember that some years ago one or two

members got up in this house and said "Anyone who suggests planning suggests slavery". Well, we have come a long way since that day.
Finally, we are told that on February 20- not in this house but addressing the junior board of trade in Toronto-the leader of the Liberal party spoke at length and impressively in favour of action in both the private and public sectors in order to ensure the growth of our economy. But he had to reassure big business. He had to show big business that this was, after all, part of the electoral gimmick strategy, so he uttered the following words:
Planning, why? When economic action is taken in the public sector it should be designed primarily to stimulate and increase activity in the private sector.
I want you to notice this:
When economic action is taken in the public sector it should be designed primarily to stimulate and increase activity in the private sector.
When we quote these words we must remember that although we have over one half million unemployed in Canada at present, the balance sheets of large corporations indicate some have made the largest profits in their history under these circumstances. We are devoted to the principle of planning for the people under the direction of the people's representatives, not by big business and vested interests.
I return to the subject of the Leader of the Opposition, who has a fascination for me this afternoon. Later in his speech on this occasion he apparently felt he had not provided adequate reassurances, and from my point of view he attempted to correct the previous impression he had created of the rejection of his own party's policy of support of free enterprise. I quote the following from his recent and famous speech:
In this new world government and business must co-operate. Neither can afford to operate in a haphazard way. What we need now is careful co-operative planning. By this I do not mean planning, or a planned economy on a socialist model. A directed and controlled economy of that kind is for us not only undesirable, it is impossible. I mean planning, not with a view to bringing about more controls, but planning so that there can be a greater opportunity for profitable progress in the private sector of our economy.
When the hon. gentleman speaks I hope he will explain to the house that apparent contradiction in terms and objectives from the general impression created by his speech. If I remember correctly the speech was made to a board of trade in Toronto on February 20. You seldom find members of the cabinet or leading spokesmen of the official opposition addressing trade unions or farm organizations. Usually they address chambers of commerce,
Alleged Lack of Economic Growth boards of trade and groups of that kind, for which they have a natural affinity.


Lester Bowles Pearson: And the national farmers' union and the Saskatchewan farmers' union.


Herbert Wilfred Herridge: When the Leader of the Opposition hears what is being said by the national farmers' union concerning the expression of opposition to the principle of marketing boards on the part of hon. members of the Liberal party and those on the government side of the house, he will not wish to turn up at another farmers' meeting.
This is extraordinary. The Liberal party proclaims that the haphazard relationship of the past between big business and Liberal governments must now be organized, with the assistance of an advisory council, to plan for more profits for the private sector. This council would be in a position to use for its own guidance, to assist in its decisions, the targets and the forecasts prepared by the economic council.
Let me quote some other remarks attributed to the Leader of the Opposition. This group has been watching every word spoken by the Prime Minister, the Leader of the Opposition and the hon. member for Bonavista-Twillin-gate. In fact we have a special man watching him for his pearls of wisdom.
The Ottawa Journal reported the Leader of the Opposition as saying in Hull on February 2 last:
The Liberal government would set Canada going again not through socialism but by planning to give incentive to private enterprise.
This sort of planning is compared by the hon. gentleman with that prevailing in Europe. But the Canadian people cannot be misled. The Liberal planning represents the theft of a word, not the acceptance of an ideal. I give the Leader of the Opposition credit for having honesty and integrity, and we all respect him, but he is addicted to the free enterprise doctrine. He is going to continue to plan for the people who have brought about every major war in history and caused every line of unemployed persons in every country of the world. If we leave it to them, in the future we will face a third world war.
How can we get our growth rate up to the necessary level? I will speak about our policy so there will be a clear understanding of what we stand for, without hemming or hawing. The New Democratic party maintains that Canada can only achieve and sustain a high rate of economic growth if she plans her economy to ensure the best allocation and use of her available resources and technology.
Canada has not had this kind of planning in the past. Whenever our growth rate has slowed down in the past, our government

Alleged Lack of Economic Growth has relied on natural forces to get it moving again, has subsidized private corporations to encourage them to undertake new investments, or has undertaken certain emergency government expenditures itself.
We give credit to the government for the introduction of such measures as the winter works program, but even that program would have been opposed by the old parties years ago. We all remember what happened in the hungry thirties, when few of the unemployed in Canada could avail themselves of a program of this nature but were offered 20 cents a day in relief camps. We have advanced since then. Since that time the C.C.F. has had an influence on Canadian public opinion, on the opinion of governments and official opposition leaders. No government today would dare return to the conditions of the thirties because of the change in public opinion.
What is a democratically planned economy? We say it is one in which the principal economic and social activities are co-ordinated and developed through deliberate planning by a democratically elected government. This should be contrasted to an unplanned economy where the principal decisions are made by private corporations and by powerful individuals associated with those corporations.
Let me illustrate that point. Last week I spoke to an important person in the Canadian pulp and paper industry. The industry faces an uncertain future. The present market absorbs approximately 90 per cent of the production of the mills in operation. This gentleman complained to me about the fact that another large mill is being contemplated to enter into production in the near future, when only 90 per cent of the present production is marketable. This seems to be the result of lack of planning and direction from the federal government in co-operation with provincial governments. That is what we mean by government control of industry, direction of investment and so on.
In our opinion a democratically planned economy is designed to serve the interests of the majority. An unplanned economy is designed to permit private corporations to pursue the goal of maximizing their profit. It is only by chance that what the private corporations do in pursuing this goal will be in the interests of the majority of the people. We must take the Leader of the Opposition at his own word. He intends to make it possible for private corporations and big business to increase their profits and expand their activities.

We believe the investment decisions of the various private corporations are unco-ordinated. Each corporation or group of corporations is concerned with its own sector of the economy and proceeds without concern for either (a) those other parts of the economy by which it does not think it is affected or (b) the country's over-all economic goals. The big corporation executive may get just as worried as anyone else when he reads in his financial paper that Canada has too little investment, or too much, or the wrong kind, but these considerations will not affect his own investment decisions for his own corporation. He will continue to make those decisions which best suit his own firm's economic welfare as he sees it. Yet there is no guarantee that what makes economic sense for a private corporation will still make economic sense for the country as a whole when all these private decisions are added up.
The result is that we get overinvestment in some parts of the economy, underinvestment in other parts. We get overinvestment in the country as a whole at some times, underinvestment at others. This is very damaging to the stability of our economy and to its steady rate of growth.
With democratic economic planning, such as that which we suggest, we can allocate our resources to serve the over-all economic goals of the country. This would level out the disastrous ups and downs that plague our economy, ensure that the economy produces what the people want it to produce, and enable us to maintain a high rate of economic growth and a low level of unemployment. The only unemployment which should exist in Canada is that caused temporarily by climatic conditions, where it would not be economic to transport workers from one area to another.


William Joseph Browne: May I ask
the hon. gentleman a question?


Herbert Wilfred Herridge: Certainly.


William Joseph Browne: Would he not include seasonal workers in that list?


Herbert Wilfred Herridge: These people are included in seasonal workers. They are persons that are put out of employment because of climatic conditions. To illustrate, may I say that in the district in which I live, any logging about the 3,000-foot level is usually ended by Christmas time, not because the companies are not operating or because there is no work to do but because the snow is too deep for economic operation. Hence quite frequently there is a lay-off of some men in January and February and possibly to March 15, until the snow lessens again.

What else, it may be asked, does economic planning involve from our point of view? Economic planning does not concern itself only with the allocation of investment as between private capital and social capital, but also within these two sectors. Planning and controlling investment within the social capital sector is relatively easy, because here the government can take direct action. For example, if the government finds that the housing program has gone ahead very quickly and is in danger of overinvestment, but that municipal services like water and sewage are lagging behind, it can shift some investment funds from the former use to the latter.
Planning and controlling investment within the private capital sector of the economy is less direct. "Indeed", some people may ask, "why do we need government planning in the private sector at all? Surely private businessmen know better than anybody else what are the best investments for their own enterprises." That is the attitude of the normal private business enterpriser.
It is true that a certain investment decision might be right for company A, another for company B and still another for company C, and so on. But when companies A, B, C and so on all across the country are making separate decisions about how to invest and what to produce, there is no guarantee that this will add up to economic sense for the country as a whole.
We make that point very strongly because there is evidence of it all over the country. I have seen it in my own lifetime. Men have started operations in a certain industry, particularly in the lumber industry. I refer to that industry because I have lived in the lumber country. They started up operations because they could get timber at that time, not looking to the future. They may find that some operations are not economic, and you have bankruptcies growing and so on, whereas if there had been some guidance, or some planning, even in the provincial sphere, we would have had sounder and longer term development. In an unplanned economy we have one corporation building an oil refinery here, another producing television sets there, another building a steel plant somewhere else, all according to how they view their own particular segments of the economy. But nobody puts all these programs of capital investment together in order to see whether they add up to a good program for the whole economy.
The other parties depend on some sort of invisible hand-the free market and so on- to see to it that this hodgepodge of private investment plans makes over-all economic sense. But there is no such invisible hand. There is no sort of over-all guiding hand in the economic field. All this in many cases
Alleged Lack of Economic Growth ends up with economic chaos because there has been no planning. There is no machinery working automatically in the private enterprise economy to see to it that our capital investment is neither too small nor too large and that it is growing in the most desirable places.
That is why we have periods of underinvestment and unemployment such as we are in now, and other periods of overinvestment and inflation as we had in 1955 and 1956. This is also why we have misuse of our investment capital with some sectors and regions being starved for needed social and private capital while others overinvest to the point that they have excess capacity for many years to come. That is not just a wild statement by radicals; that is a fact, and we find the results all through our economy in recent years.


Lester Bowles Pearson: Before my hon. friend leaves that point, I wonder whether he would permit me to ask him a question?


Herbert Wilfred Herridge: Yes.


Lester Bowles Pearson: I have been trying to follow what he is saying. Is he saying that there should be no private or corporate investment without government approval?


Herbert Wilfred Herridge: No, Mr. Speaker. We are talking about the commanding heights of the economy, those sectors of the economy which have a controlling influence on the economic destiny of the nation. As we have said before, we believe in public ownership wherever it is socially desirable and wherever it is indicated that it is in the best interests of the nation. We believe in much larger development of the co-operative enterprise. We believe there is a tremendous opportunity for socially desirable and socially responsible legitimate free enterprise, which is found largely in smaller industries, community industries and services, small businesses, farming and so on. In those sectors you will find economic organizations or groups themselves, under a change in our philosophy, directing their own destiny, working together co-operatively in accord with a national plan which has in mind the over-all planning we suggest. We believe there is a great amount that government can do by giving some direction and some guidance, some central purpose, to the development of our economy. In those large sectors we suggest planning as I have mentioned, and in these other sectors we suggest the influence of government, smaller group organization and co-operation to bring about the same result.


Murray Douglas Morton: May I ask the hon. gentleman a question?


Herbert Wilfred Herridge: Yes.

Alleged Lack of Economic Growth


Mr.   Morion@: Is he suggesting that no new enterprise should commence without government consent or that no investment should be made without government consent?


Herbert Wilfred Herridge: I am not suggesting that no investment should be made. I will illustrate the matter in this way. I mentioned this large pulp mill that is going to be built. I do not know where it is going to be built, as a matter of fact, but I know it is going to be built. It will make more acute the problems of producers now in operation at this time. This is the situation in various segments of the economy including the mining industry, the forest industry and large scale manufacturing. We believe that government policies must be such that they will have the power to control the situation so that there is no uneconomic investment-


Mr. Browne (Si. John's Wesl):: Would the federal government have that power?


Herbert Wilfred Herridge: Yes. It would have great influence on it through taxation and fiscal policies. We recognize that this is not an easy problem to solve. You will have to have the co-operation of provincial governments in many of these fields in order to reach the desired objective. But we believe we must start in this direction. We do not underestimate the difficulty, but we are laying out a positive program rather than let the economy drift, in our opinion, as a free enterprise economy in which large scale investors have no concern for the other sectors of the country except their own. I am not blaming them a bit, because under present circumstances they are forced into that position.
Mr. Speaker, I observe people nodding their heads and waving to me. I am just doubting whether my time has nearly expired. In any event I am going to say this. A New Democratic government would take steps to end what we term this economic chaos. This party has no faith in the invisible hand, as I said before. What planning machinery would a New Democratic government establish? A planning board would be set up, staffed with specialists in various fields, including economists, statisticians, engineers, scientists and so on. This planning board would follow four basic steps:
1.	Find out what the people want their economy to produce, and how they want it to perform.
2.	Find out what the economy is capable of doing, based on the available resources and technology.
3.	Set up a number of goals within the limits of the economy's capacity and based on the people's choices.
IMr. Herridge.]
4.	Draft a plan which would so allocate our resources and technology that these goals could be attained.
This plan would be presented to the cabinet who would discuss it and, after making any changes that they deemed necessary, would present it to parliament for debate. That is when the Minister without Portfolio would have his opportunity if he were here at that time. If parliament passed the proposals outlined in the plan, the government would proceed to put it into action.
There are many details of such a plan. Some might say, how would the planners find out what the people want? Other members of our group will go into the matter of how the planners find out what the economy is capable of doing and how they set up goals for the economy. Our people have these things worked out in considerable detail. The techniques of planning are rather complex but the general ideas involved are fairly simple. First of all, we have the spending and taxing powers of the government. This very general approach, of course, is not adequate in itself. Government spending and taxation must vary for different sectors of the economy and different industries. For example, corporation taxes can be made higher for industries that are overinvesting and lower for those that need to invest more. Government spending should be heavy in those sectors of the economy such as social capital and those regions like the maritimes that have difficulty attracting the necessary private investment funds. We say that Conservative, Liberal and Social Credit governments have not used their spending and taxing powers in this way to influence the direction of investment.
Then there is the question of the Bank of Canada and monetary policy. The proper policy to follow during periods of inflation is to contract the money supply, which raises the interest rates on loans made by chartered banks. This makes it more difficult for businesses to acquire funds and thus helps prevent them from overinvesting under the wrong circumstances and conditions. In periods of recession and unemployment the proper policy is to expand the money supply, which lowers the interest rates on loans made by the chartered banks. This will make it easier for business people, municipalities and home builders to borrow money for needed investment to stimulate the economy. Money, in other words, should be tight in periods of inflation-I do not really like the word "tight" but it is very hard to find another word to express the idea-and easy in periods of recession.

We hear people say, would planning mean regimentation and loss of freedom? The planning board which a C.C.F. national government would establish would not govern the country. Its role is to use its specialized training to gather information and draw up plans. The final authority will always be the people themselves through their representatives in parliament. All plans drawn up by the planners would have to receive the approval of the elected cabinet before being presented to parliament for debate. After being presented for debate the people's representatives in all parties would have full opportunity to discuss the plan, propose amendments, and reject or accept it. That is democratic enough, is it not? Moreover, economic planning does not mean directing or regulating every economic act or even any large number of acts.
I could go on to deal with the Bank of Canada and monetary policy, the control of finances and the necessity for a Canadian development fund which we believe would channel investment into uses which today are neglected by the private investor. We believe in the planning of public investment. There is a great opportunity for public ownership and there are other planning agencies that could be developed. There are several besides the ones I have mentiond that have been present for some time in the Canadian economy and which could be used in the over-all planning process. We could utilize them to greater advantage. I give as examples Central Mortgage and Housing Corporation, the board of transport commissioners, the wheat board, the restrictive trade practices commission and the tariff board plus a large number of provincial agencies whose cooperation we would seek to obtain in giving effect to a program which would provide a national economic purpose for our country. Today there is no attempt to co-ordinate the work of these agencies with a national economic plan. A New Democratic government would co-ordinate their activities just as it would co-ordinate the activities of big business.
I say in conclusion that in an unplanned economy people have very little say about how their economy is to perform, what it is to produce, and so on. The only way they can express their wishes in an unplanned economy is by their purchases in the market place and this only works to their advantage if the market place is perfectly competitive. I might say that there are fields in the smaller areas of business and industry where they are competitive. In fact, of course, the market place is controlled in general by a handful of
Alleged Lack of Economic Growth firms in each industry so that to a very large extent the people's wishes can be ignored.
Democratic economic planning would give the people as a whole a degree of control over their own economic destiny which they do not now enjoy. Instead of just hoping for full employment, rapid growth and security they could take positive steps and participate in the planning to see that the economy provides these things. Economic planning does not impose choice; it allows choice where little now exists. It offers an opportunity for people in all walks of life to co-operate with the national and provincial governments with some purpose. It will give purpose to their lives, a sense of security and a central direction to our economic development. It offers freedom to the Canadian people in the fullest sense of the word.


Mr. Hees:: Mr. Speaker,-


Mr. Deputy Speaker:: Order. The hon. member for Kootenay West has not finished his speech.


Herbert Wilfred Herridge: As an amendment to the amendment, Mr. Speaker, I move, seconded by the hon. member for Vancouver East (Mr. Winch):
That the period at the end of the amendment be replaced by a comma and that the following words be added:
"by the expansion of public and co-operative ownership for such purposes as the operation of utilities, the development of resources, the elimination of monopoly concentrations of power, and the operation of major enterprises immediately and directly affecting the entire nation."
I move this subamendment to give some reality, shall I say, to the amendment moved by the official opposition. The few words contained therein represent the philosophy of our movement, and when the vote comes we hope that we will not only receive the support of members on the government side but also that of members of the official opposition.


George Harris Hees: Mr. Speaker, during the past weeks and months and again today we have heard a number of misleading speeches and have read a number of misleading articles and publications put out by the Liberal opposition, all attempting in some strange fashion to convey to the people of Canada that this country's economy has slowed down. In fact, I think the hon. member for Niagara Falls (Miss LaMarsh) used the word "stagnating" this afternoon. So, Mr. Speaker, we in the government welcome this opportunity to set the record right, and I should like to speak about the economy at this time under three headings. First of all, I should like to deal
12GB	HOUSE OF
Alleged Lack of Economic Growth with the situation which this government found existing in Canada when we took office in June, 1957. Then, I should like to deal with the progress that has been made since that time. Finally, I should like to deal with the prospects for the future.
First, I shall begin with what we found when we took office in June, 1957. Early in 1957 it was apparent that two important changes had taken place in the trading world. The first was that the countries of western Europe and Japan had completely recovered from the devastation of war and, having rebuilt their economies and their productive machinery, were no longer customers for many of the products we had been selling them in large quantities since the end of the war. The second change was that these countries, having replaced their productive machinery with the most modern and efficient equipment in the world, were rapidly becoming very serious competitors for our market both around the world and right here in Canada itself.
In addition to these two disturbing facts of economic life which we discovered when we took over the government in June, 1957, we also found that the Canadian economy had been for some months steadily slowing down due to the tight money policy imposed by the Liberal government of that day. Government economists had, early in 1957, warned that industrial activity in Canada was contracting at an alarming rate. The government's tight money policy had made it impossible for industry to acquire the funds necessary to invest in new plant and equipment and in new inventory which it needed, and the expansion of the economy had slowed down accordingly.
Now, Mr. Speaker, faced with such a situation we immediately set about the task of readjusting the economy to the conditions of 1957. As a result of the policies which were adopted, the country came through this difficult period of readjustment fully as well as the United States which faced similar problems. In fact, Mr. Speaker, because of the corrective measures which were adopted so promptly there was less of a let-down in industrial activity in Canada than there was in the United States. The final proof of the effectiveness of this government's actions during these difficult years is the fact that the Canadian economy is again moving vigorously ahead. So that all members may know just what has been accomplished during the present government's term of office, I should like to cite some key economic indicators, and in each case I will show the increase that took place between 1956, the last full year when a Liberal government held office, and 1961.
[Mr. Hees.l

In so far as total employment is concerned, total employment increased between 1956 and 1961 by no less than 452,000 new jobs, a percentage increase of 8 per cent. The gross national product increased by $6.8 billion or 22 per cent. Exports increased by $900 million or 19 per cent. Imports were kept down to an increase of $200 million or an increase of 3.5 per cent. Total personal income increased by $6.8 billion, an increase of 30 per cent. Labour income increased by $4.6 billion, an increase of 30 per cent. Corporate profits increased by $207 million, an increase of 6.2 per cent. Industrial production increased by 15 per cent and consumer spending increased by $5.8 billion, an increase of 30 per cent. Total personal savings increased by $400 million, an increase of 30 per cent.
I feel, Mr. Speaker, that all hon. members, in fact all the people in the country, will agree that this performance, particularly when you take into consideration the very difficult conditions we faced when we took over the government in 1957, is a very creditable one indeed. However, Mr. Speaker, the most spectacular advance has taken place during the past year when the economy really started moving in high gear. I should like to give you some examples of just what has taken place during these past 12 months. The latest figures available in respect of export trade are for last November and we find that during the first 11 months of the year exports increased by 8 per cent over the first 11 months of the year before. This rate of increase was more than double the rate of increase for the last five years. During the last three months of that 11-month period, in other words last September, October and November, the rate of increase was 15 per cent over the same three months the year before. I think you will agree, Mr. Speaker, this indicates quite a remarkable rate of acceleration. First of all, you see a steady increase year by year and then during the past year double that rate of increase; and during the past three months the rate of increase was doubled again. This is acceleration if I ever saw it, Mr. Speaker.
During the first 11 months of the year we achieved a surplus trade balance of $27 million, the first surplus trade balance since 1952. In 1956, the last year of Liberal government, Canada had a trade deficit amounting to $713 million. So we see that during the past year we produced right here in Canada nearly three quarters of a billion dollars worth of goods which were formerly produced, under the Liberal government, outside of Canada and the production of which provided jobs for Canadians instead of for

workers in other countries. From November 1960 to November 1961, the last month for which figures are available, industrial production increased by 8 per cent. This was three times the rate of increase during the last five years, from the first to the third quarter of last year, that is within the brief period of six months, Canada's over-all production of goods and services in real terms rose by no less than 4.7 per cent. This rate of growth in national output exceeded that achieved in any like period in 14 of the last 15 years. I think everyone will agree that this has been quite a remarkable achievement under today's very competitive conditions. This growth has been achieved without any rise in the price level. In other words, not only is the present rate of growth of the Canadian economy comparable to any of the post-war years, but the absence of inflation indicates that it is proceeding on a sounder basis.
Between December 1960 and December 1961, employment increased by 180,000 new jobs. This was nearly double the rate of increase during the last five years. I should like also, Mr. Speaker, to cite some additional key indicators which are normally used to indicate industrial growth and which also demonstrate just where our economy has been moving during the past year. I will name the indicator, then the latest month in 1961 for which figures are available and then the percentage increase over the same month of the year before:	Manufacturing employment,
December, up 6 per cent; new orders in manufacturing, November, up 9 per cent; construction contract awards, December, up 15 per cent; production of motor vehicles, December, up 14 per cent; production of textiles, November, up 15 per cent; production of petroleum, November, up 32 per cent; production of nickel, November, up 28 per cent; production of steel ingots, probably the best key indicator of all, and this is basic steel, was up a remarkable 37 per cent.
Now I should like to underline what this government has done to assist industry achieve this very spectacular result during the past year.
1.	First of all we lowered the exchange rate to a more realistic ratio with other world currencies, which had the effect of making Canadian exports more competitive in world markets. It has discouraged excessive imports and has provided a needed impetus to our tourist industry. The full benefits of this step should be felt increasingly during the present year.
2.	We have held trade and industrial conferences in Ottawa and in all the provinces to bring the services of the Department of
Alleged Lack of Economic Growth Trade and Commerce directly to businessmen in all parts of Canada. By so doing we have stimulated their interest in going into the export market and helped them to produce more efficiently and effectively for the home market. More than 5,600 businessmen have attended these conferences.
3.	We have greatly expanded our trade mission and trade fair programs to show businessmen the opportunities which exist in foreign markets and to help them display their products in those markets. Those programs will be pushed forward and expanded vigorously during the present year. Businessmen have co-operated enthusiastically in the development of our trade mission and trade fair programs.
4.	We have introduced export credit facilities to provide long term financing for capital goods exports. Sales to date for which contracts have been signed and which were made possible by the use of export credits amount to approximately $41 million; and credits which have been authorized by the government, but for which sales are still being negotiated by the companies concerned, amount to approximately $114 million.
5.	We had our trade commissioners survey the markets they are serving and report on any products made in Canada for which there is a demand in their market or in which they believe our present sales could expand. The result of this survey was that last June we were able to advise producers right across Canada of more than 2,500 market opportunities waiting for aggressive salesmen with a good product at a competitive price.
6.	We have greatly expanded the functions of the Industrial Development Bank to provide small and medium sized firms with a larger source of working capital.
7.	We have made available loans to small businesses, to release working capital for these small but very important industries which previously had no alternative source of funds for growth.
8.	We have introduced accelerated depreciation to encourage production of new products and the establishment of new industries in labour surplus areas. Since March of last year the department has approved applications for double depreciation on assets valued at close to $110 millions. Sixty per cent of the approved assets relate to firms located in surplus manpower areas, and a wide variety of new products will be manufactured with the approved assets. They include new types of steel, chemicals, electronics, plastics, foods, paper, textiles, and many other products. At the present time applications for an additional $55 million are being considered by my department.

Alleged Lack of Economic Growth
9.	We have set up the national productivity-council to help industry become more competitive, and thereby provide more sales and more jobs.
10.	We have established a national design council and a national design branch within my department to assist Canadian industries with their design problems and, by encouraging improved design, make possible more sales and more jobs.
11.	We have introduced a domestic commerce service which is a completely new arm of the department and has been created to help new industry become established and expand.
I believe all hon. members will agree that the production figures I mentioned a few moments ago show more clearly than any words I could utter just what has been achieved by the co-operative effort of government and industry during the past year, and what can be achieved in the future if we continue the same teamwork effort. In the kind of competitive world in which we find ourselves today nothing less than that kind of effort will do.
The important thing is to keep intact the present teamwork effort between industry and government. The Liberal opposition are making all kinds of extravagant promises in a desperate effort to regain power but remember, Mr. Speaker, they are the same people who slowed down the economy in 1957 with their tight money policy, and they can be counted on to apply the same tight money policy again if they should ever regain office, and slow down the economy the same as they did in late 1956 and early 1957. There never existed any teamwork effort between last Liberal government and industry, simply because that government was not interested in co-operating with industry. It is just as simple as that, and if anybody doubts my words all he has to do is speak to any businessman in any part of Canada and he will say that that is so.


John Whitney Pickersgill: How ridiculous can you get?


George Harris Hees: The thing which amazes businessmen is that when they come down to see this government they find they are treated courteously. We receive them and look for ways to help them instead of finding ways in which to brush them off quickly, as happened under the Liberal government.
It is vitally important that the present government should stay in control of the economy, and it is going to do just that. There is no doubt about it, and thus it will be able to maintain the present teamwork effort which is paying off in such a spectacular fashion today. Under this government, and with the

kind of co-operation we have had between industry and government, we can continue to work steadily forward towards full employment and the greatest prosperity this country has ever known.
That success story which I have just related to the house, that record of prosperity and that record of increasing employment is simply killing the Liberal opposition. Their plans have been completely upset. They have been desperately hoping for increased unemployment to help them in the next election, but instead of increasing unemployment they are being met with increasing employment and increasing prosperity, and so they have switched to a different tack. This tack encompasses a series of personal attacks, more of which we can expect to hear from now on.
This plan of campaign was first indicated in an article in Macleans magazine last fall, an article written by Peter Newman, and I might add that that magazine has never been unfriendly to the Liberal opposition. The first implementation of that new policy took place in this house last Thursday, a disgraceful performance if there ever was one. It was a vicious attack on the Prime Minister, a completely unfounded and untrue attack in which there wasn't a word of truth, and it was made by the hon. member for Richelieu-Vercheres (Mr. Cardin).


John Whitney Pickersgill: I am rising on a point of order. Mr. Speaker, it is a well known rule of this house that it is not competent for any hon. member, even a minister of the crown, to seek to revive a debate which has already been concluded by a vote in this house, and neither is it competent for him to refer to speeches made in another debate. That rule has always, to my knowledge, been enforced in the house and I hope it will1 be enforced in this case.


Mr. Deputy Speaker:: It is a rule of the house not to refer to debates which have already been completed in the same session unless there is a direct bearing on the subject under discussion. I trust the hon. minister will relate his remarks to the amendment and to the subamendment now being considered.


George Harris Hees: I can understand the sensitivity of the hon. member for Bonavista-Twillingate regarding that speech, because I understand he wrote a very great deal of it.


John Whitney Pickersgill: I hate to waste the time of the house by rising on a question of privilege but it is just possible that someone outside the house might believe what the minister has said. I hasten to assure the house, which already knows it, that the statement just made by the minister is unqualifiedly false.


George Harris Hees: Well, whoever did write that vicious, guttersnipe, back alley speech should be thoroughly ashamed of himself. It was a disservice to this house that that speech was ever uttered and I hope another like it is never heard in this chamber. We have laid before the people facts regarding the program we have carried on for the benefit of the people of this country during the four and a half years since we took office. This has been done in speeches by the Prime Minister, by myself and by other members of the government. We have outlined what is, I think, an excellent record. Moreover, the Prime Minister has indicated the excellent program we have for the future of this country. And, as my right hon. friend said recently, we shall be very glad to let the people judge that performance and that program for Canada's continued rapid development in the not too distant future.


Mr. C. W. Carter (Burin-Burgeo):: Mr. Speaker, the minister has made a brave effort to reassure himself and his supporters that all is well with the economy of Canada. He has cited figures which related to the past year and, more particularly to an upswing in the last quarter of last year, and has presented that as representing a picture of the economy throughout the whole period of four years, or more that this government has been in power.
The minister should know that figures for part of a year, even if they show a slight upswing, do not represent a sound economy any more than one swallow does not make a summer. Nothing that the minister has said can alter the fact that during the last four years and more during which this government has been in office the economy has expanded by only about 1.5 per cent per year as compared with 6 per cent per year in the previous five year period under the Liberal government.
My colleague the hon. member for Niagara Falls (Miss LaMarsh) has already referred to this stagnation in our development and has spoken of the steps which a Liberal government would take to correct it. I should like to develop this theme a little further and in so doing I propose to confine my remarks to the position of the Atlantic provinces.
I think it was Lincoln who said that no nation could survive half slave and half free. I think it is equally correct to say that no nation can survive half rich and half poor. In the light of the present challenge to our democratic way of life perhaps we could go further and say that no society can survive half rich and half poor. We recognize the importance of the economic front in the war of ideas in which we are now engaged by
Alleged Lack of Economic Growth providing assistance to the under developed countries of the world. Surely we cannot afford to be less concerned about the underdeveloped parts of our own country.


Mr. Murphy:: Mention the provincial grants, then.


Chesley William Carter: To speak of the Atlantic provinces as underdeveloped is not to say that no economic growth has taken place at all. But growth has been extremely small and painfully slow. At the time of confederation in 1867, the Atlantic provinces-perhaps I should more correctly say the maritime provinces- were relatively prosperous. They had flourishing economies based on agriculture, fishing, forestry, shipbuilding, shipping and international trade. Their provincial governments were in a generally sounder financial position at that time than the governments of the central provinces with a lower per capita public debt, a lower cost of living and a lower level of taxation.
One effect of confederation was to restrict this international trade which was an important factor in the maritime economy. The volume of trade with the central provinces which it was hoped would compensate for that loss did not materialize. The restriction of international trade produced, in turn, an adverse effect on the shipping industry and this, together with the advent of steam, crippled or curtailed the shipbuilding industry, though I believe at least one steamship was built in New Brunswick in the early days of steam. Thus, the Atlantic provinces were compelled to rely more and more on their primary industries of agriculture, fishing, mining and forestry as the basis of their economies. Ten years delay in building a railroad to link the maritimes with the central provinces and the overriding claims of military rather than economic considerations in determining the route of that railway were not conducive to the establishment of secondary industries. Consequently the maritime provinces began to lag behind the rest of Canada economically. This gap has steadily widened over the years. We can obtain a better idea of the magnitude of this lag by looking at the figures for population growth as published by the dominion bureau of statistics.
In 1871 the population of the maritime provinces, excluding Newfoundland, of course, was 768,000 representing 21 per cent of the population of Canada. Newfoundland had not entered confederation at that time. In 1961, 90 years later, the population of the Atlantic provinces, including Newfoundland, was only 1.9 million people representing 10.5 per cent of the population of Canada.

Alleged Lack of Economic Growth


Mr. Jones:: And Mr. Gordon wants to export more, does he not?


Chesley William Carter: Without Newfoundland the population would be 1.4 million representing 8 per cent of the population of Canada. These figures show that in the 90 year period the population of the Atlantic provinces has barely doubled while the population of the rest of Canada has increased five times over. Had the population of the Atlantic provinces increased at the same rate as the population of the nation they would today have a population of approximately 4 million people. That represents a tremendous loss in terms of human resources as well as in terms of domestic market.
The most striking example is afforded by Prince Edward Island. In 1961 the population of Prince Edward Island was 103,000 people but 80 years earlier in 1881 it had a population of 109,000.
If we look at the figures for disposable income-that is income available for spending after the payment of taxes, etc.-the disparity is even more marked. As I said the Atlantic provinces today represent approximately 10.5 per cent of the Canadian population but they have only 7J per cent of Canada's disposable income. In my next comparison I shall use figures since 1949, the year Newfoundland entered confederation, so that province will be included. Personal income per person in the Atlantic provinces in 1949 was $622 per person compared with $982 per person for the rest of Canada. In 1959 the figure was $991 per person as compared with $1,546 per person for the rest of Canada.
Incidentally, the figure for Newfoundland has increased from $472 per person in 1949 to $841 per person in 1959 which indicates that Newfoundland is making some progress toward closing the gap between that province and the other Atlantic provinces.
It is not right to say federal governments in the past have been uninterested in this problem or that no attempt has been made to counteract it over the years. On the contrary a great deal has been done. No less than 14 royal commissions have been set up at various times to study different aspects of the problems connected with the economy of the Atlantic provinces. Out of the recommendations of these commissions have come such legislative items as trade subsidies, freight rate assistance, coal subventions, equalization grants, and the establishment of the industrial development bank, just to mention a few.
Nor do I wish to detract from what the present government has done by way of Atlantic provinces special grants, increased

subsidies and subventions for coal, small loans to business and other fiscal measures such as deferred depreciation. However, I maintain that this problem cannot be solved in a haphazard or piecemeal way by any number of isolated measures such as I have just mentioned.


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


Chesley William Carter: No, I will answer questions after I am finished.
In the throne speech debate-


John Ferguson Browne: The hon. gentleman cannot refer to a previous debate as the hon. member for Bonavista-Twillin-gate pointed out.


Chesley William Carter: I do not know what the hon. member is referring to.


William Joseph Browne: On a point of order, Mr. Speaker, the hon. member is about to refer to the throne speech debate. I suggest to him that his friend the hon. member for Bonavista-Twillingate stated that reference cannot be made to a previous debate.


Chesley William Carter: I stand corrected, Mr. Speaker.
A few days ago, in this house, the hon. member for Queens-Lunenburg (Mr. Crouse) who wanted to ask me a question cited a number of industrial activities in an effort to prove that economically the province of Nova Scotia is moving forward. I point out to him that in the same debate the hon. member for Grand Falls-White Bay-Labrador (Mr. Granger) in his excellent contribution also listed a number of industrial activities that are taking place in his riding which represent an even greater total of capital investment than that mentioned by the hon. member for Queens-Lunenburg.


Lloyd Roseville Crouse: All under a Conservative government.


Chesley William Carter: Just wait. We will see.


John Whitney Pickersgill: A Conservative government in Newfoundland?


Lloyd Roseville Crouse: Some day.


William Heward Grafftey: After the next election.


Chesley William Carter: The hon. member for Grand Falls-White Bay-Labrador did not use that argument to imply that the over-all economic picture of Newfoundland and the Atlantic region is rosy. The truth is that these industrial activities are not the result of federal action but result from the efforts of the provincial governments.


William Joseph Browne: Ho, ho.


Mr.   Carler@: Important and desirable as they are, they are barely sufficient to take care of the natural increase in our work force. In spite of the economic expansion referred to by the hon. members the economic gap between the Atlantic provinces and the rest of Canada is getting wider instead of narrowing as shown by the unemployment figures published by the dominion bureau of statistics.
In 1954 the work force of the Atlantic provinces numbered 501,000. In that year there were 33,000 people out of work the whole year round, on the average, representing 6.6 per cent of the work force. In 1956 there were 31,000 out of work the whole year out of a work force of 521,000, representing 6 per cent. In 1958 there were 67,000 unemployed for the whole year out of a work force of 544,000 representing 12 per cent of the work force.


Mr. Pugh:: Do you have the figures for 1961?


John Whitney Pickersgill: They are even worse.


Chesley William Carter: Just wait. In 1960 there were 60,000 unemployed for the whole year out of a work force of 560,000 representing 11 per cent. To come to the latest figures which my hon. friend wants me to put on the record may I say this. The latest figures show that there are 84,000 people out of work in the maritimes-that is the last figure available and is for January 13-just exactly the same as the figure for the year previous, which was also 84,000. In other words, 14.7 per cent of the work force were out of work or unemployed on January 13 as compared with 14.9 per cent a year previous.
These figures do not tell the whole story as only 6,000 people joined the Atlantic provinces labour force between January of last year and January of this year. During the previous five years an average of 14,000 people had come into the labour force. If there had been a normal increase in the Atlantic province labour force of 14,000 people there would have been 84,000 plus 14,000 minus 6,000, or 92,000 people out of jobs on January 13. Between January 1957 and January 1962 unemployment increased by 5 per cent. However, the labour force increased by 12 per cent so that less than half of the new people coming into the labour force in the Atlantic provinces were able to find jobs. If this problem is ever to be solved, it must be done by special action on the part of the federal government. The provinces are powerless to do more than they are already doing until action is taken to remove the handicaps and disabilities under which they are now compelled to operate.
Alleged Lack of Economic Growth
Reasonable people will understand that a situation which has been steadily worsening for over 80 years cannot be corrected overnight. Special treatment is required and special agencies must be set up to administer it. This solution must also be worked out within the framework of a national policy. It is foolish to pretend that this is going to be easy, and the effects of automation may render the solution even more difficult. It is obvious that if a region lags economically when the rest of the nation enjoys a boom, it is impossible to improve the economy of the backward region when the national economy is in a state of stagnation as has been the case during the past four years. The first step then must be to get the national economy rolling again.
In the past we have had a national policy nationally applied. The tax arrangements between the federal government and provincial governments which were pioneered by the Liberal party were aimed at making possible a Canadian standard of public services across the country. However, a national policy applied on a national scale cannot be adjusted with sufficient precision to take care of the great differences in economic conditions between the various economic regions of our country, because the instruments of control are too blunt to be adapted to the measures that must be taken. As a result, we have an overexpansion in one part of Canada while at the same time there is an underexpansion of the economy in another part.
I believe we must now go beyond aiming at a Canadian standard of public services and must aim at greater equality of employment opportunity. To achieve greater uniformity of economic development our national policy must be applied regionally instead of nationally. The national policy would set up the national goals for public and private sectors of our economy and then that policy would be applied in terms of regional goals for different economic areas. This may involve a new kind of budgeting procedure with the government presenting an over-all budget not for one year but for a period of say three years or even five years, with interim budgets brought in for essential adjustments. To implement this policy it would be necessary to set up, in my opinion, a new department of government, namely a ministry of regional development and rehabilitation. A regional development authority would also need to be set up to co-operate with industry, labour, and provincial and federal agencies in determining the best way of attaining the regional goals and to co-ordinate the efforts of all concerned so that the regional efforts can be integrated into the economy of the whole.

Alleged Lack of Economic Growth
The development authority would have committees of experts to study and advise on the special problems connected with the resource industries of fisheries, agriculture, forestry and mining; the manufacturing industries and the marketing and transportation of our products.
I know that this sounds very much like planning, Mr. Speaker, and I have avoided using that word because the socialist party to our right seem to think they have a monopoly on it.


Murdo William Martin: Is that the socialist party to your political right?


Chesley William Carter: The socialist party in the corner. I listened the other night to the leader of the New Democratic party. Later on in the evening I listened to the leader of the New Democratic party in the Ontario legislature; I refer to Mr. MacDonald. Today I listened with great interest to the hon. member from Kootenay West. They all seem to have the same theme. They all seem anxious to have the public identify socialism with planning.


William Heward Grafftey: Jean Lesage.


Chesley William Carter: Even Jean Lesage. But no party or no group has a monopoly on planning. The kind of planning that we think of is very different from the planning advocated by the Leader of the Opposition-


Some hon. Members:: Oh, oh.


Chesley William Carter: -I mean the leader of the N.D.P., whose remarks I listened to very carefully, because what he was advocating was not planning but regimentation and that to my mind is the badge of socialism.


Herbert Wilfred Herridge: Would the hon. member permit a question?


Chesley William Carter: A little later. I am very leery of questions. A Liberal government would set up a fund to provide industrial capital and capital grants for basic projects. A great deal has been said about capital grants and there is no doubt that they have a place in working out a solution to the economic ills of the Atlantic provinces. But any sound recovery must be based on our resources and it seems to me that a capital grants program could perhaps be most usefully employed to level out the imbalance between upsurges and downswings in the economy.
The co-operation of the chartered banks would have to be solicited with respect to the provision of credit, and I believe it would also be necessary to expand the industrial development bank to provide credit when for various reasons the chartered banks cannot conveniently supply it. In addition, there must be a system of tax and trade incentives.

To come back to the Atlantic provinces, I would point out that our economic problems resolve themselves into two parts. One is the employment gap and the other is the income gap. These will have to be treated as two separate problems and the employment gap should be tackled first. Any improvement in the employment gap will automatically be reflected in an improvement in the income gap.
In applying this regional policy we must start with what we have, our resources, including our fisheries, forests, mines, our agriculture, our tourist attractions, our hydro electric potential and our potential for secondary industries. We shall have to expand these and diversify our products and find new markets for them.
It seems to me that the provision of new markets or of expanded markets is really the key to any solution of the economic problems of the Atlantic provinces because our trouble can be traced directly to confederation which deprived us of our natural markets. At that time we sold nothing to the central provinces. Our trade flourished with the United States, England and other parts of the world but mainly with the United States. If, as our leader suggested, we can develop an association with other countries in an Atlantic free trade area, it seems to me that this would go a long way toward remedying the handicap from which the maritimes have suffered ever since they became part of Canada.
Some means will have to be found to induce manufacturing concerns to settle in the Atlantic provinces and to discourage Canadian firms from closing branches which they have in those provinces. All too often in the history of our region it has happened that somebody has started a little industry in a small way and when the industry has begun to flourish a firm from central Canada has come down to the maritimes, bought out the little industry and then closed it with the result that people have been put out of work. I think that sort of thing should be discouraged and in my opinion it can best be discouraged by providing tax incentives which would make it uneconomic to close down these small branches. They are not closed down because they are losing money or are unprofitable but are closed down in many cases because the companies concerned can make more money by doing so. This, of course, means hardship to the economy of the area affected.
I think we could also very well borrow an idea from Eire and some of the European countries and extend a tax rebate on profits derived from exports. That should encourage manufacturing industries from other countries to establish themselves in the Atlantic

provinces, and since these firms would already have their markets that problem would be taken care of.
The income gap, of course, is going to be much more difficult to close than the employment gap. With deference to the hon. member for Kootenay West (Mr. Herridge), I would think that with a planned program over a period of ten years, or two five year programs it should be possible to close the employment gap fairly well. But I am not so optimistic about closing the income gap because even if we level out the rate of expansion it will be well nigh impossible for the Atlantic provinces to overcome the lead which the rest of Canada now has. Perhaps that problem will be taken care of some day by automation because there must come a time when production in the central provinces will level out and as automation becomes more common costs of production will be fairly well evened out as well.
If we can remove the handicaps of the extra cost of living and the additional transportation costs which now enter into our cost of production in the Atlantic provinces, I see no reason why the ingenuity of our people cannot make the economy of the area dynamic once more and do so not only to the benefit of themselves but to the benefit of the whole of Canada.


Lloyd Roseville Crouse: Will the hon. gentleman answer a question before he takes his seat?


Chesley William Carter: Yes, what is it?


Lloyd Roseville Crouse: You began your speech by mentioning the low income and low population in the Atlantic provinces. I think this is the greatest indictment of the Liberal government which was in power for 22 years that I have ever heard in this house. Then, you went on to mention the Atlantic provinces adjustment grants-


Mr. Speaker:: May I interrupt the hon. member for a minute? First, I should like to remind him to address the Chair rather than the hon. member. Then, he is not taking the floor to make a speech, but to ask a question.


Lloyd Roseville Crouse: Thank you, Mr. Speaker.
Having said that, having commended the government for its Atlantic provinces adjustment grants, he then said that this type of assistance is not the answer to the problems of the Atlantic provinces. Is the hon. member against the Atlantic provinces adjustment grants?


Chesley William Carter: I am sorry; I did not hear the question.
26207-1-81i
Alleged Lack of Economic Growth


Lloyd Roseville Crouse: Are you against the Atlantic provinces adjustment grants as put into force by this Conservative government?


Chesley William Carter: I said nothing that would lead to that conclusion. My hon. friend does not understand plain English.


William Heward Grafftey: In many ways, Mr. Speaker, I do not find myself at the moment in too enviable a position. The hon. lady who started oft this debate started it in a sort of high, statesmanlike tone, talking about economic growth. This is another issue upon which Her Majesty's loyal opposition has, all of a sudden, seized. Then, the Minister of Trade and Commerce (Mr. Hees) met this question head on, and I thought for a moment-


John Whitney Pickersgill: Got it right down into the gutter.


William Heward Grafftey: -I thought for a moment we were going to lock horns in a very profitable debate. I say, sir, that I find myself in a relatively unenviable position because the hon. member who has just spoken represents an area which, like other areas in this country, is faced with serious economic problems. I have spoken to hon. members from Newfoundland who support the government, and they have told me time and time again in informal conversations of the great problems of this area. It is very difficult when an opposition, which somehow or other shuns debate, starts off on a very high tone giving a very general theme and then before the debate really gets started they go into the details of regional considerations. I doubt even that the hon. member's speech will read that intelligently back home; it certainly has not contributed to what I hoped would be a very worth-while debate.
The hon. lady who led off the debate said there was an emergency at hand and that no vigorous measures had been taken. Then, what did the hon. member who has just spoken say? He talked about a ministry of regional planning and regional development, set up by experts who are going to think about the problems, then think about them again and then, as the opposition so often suggests, submissions would be made to another council for consideration which, in turn, would submit them to another advisory council. Perhaps we would have an opinion in about ten years. This is the answer of the opposition to the demand for immediate action. I shall have something to say about this type of debate in a few moments.
(Translation):
Mr. Speaker, some time ago, members of the opposition tried to ride another subject

Alleged Lack of Economic Growth to death by attacking, but without success, our leader (Mr. Diefenbaker). Second, in previous years, they tried to create the impression, both at home and abroad, that the economy of this young and great Canada of ours was in a precarious state. Fortunately, they did not convince the Canadian people.
Today, in attempting to back up their fantastic tale, they are using, not one statistic, but part of one statistic, to prove or to try and prove that Canada is in a very bad way.
( Text):
I realize that it is the role of the opposition to seize upon worth-while issues upon which to go to the people. First of all, many months ago, even years ago, before the opposition got settled in their chairs, they preached that well known story of gloom and doom to Canadians. They have given up that attack because they understand it has gotten them nowhere.


Chesley William Carter: Are you contributing to the debate now?


William Heward Grafftey: Then, sir, they tried to attack our leader. They have abandoned this method of attack. Today, when there are so many statistics which prove that Canada is moving forward-you can look at carloadings; you can look at any amount of statistics including export statistics presented on the floor of this house this afternoon by the Minister of Trade and Commerce-what do they do? They do not seize on one statistic, they seize on a part of one statistic, namely the percentage factor in relation to the gross national product. They are trying again, I submit unsuccessfully, to prove that this country is in a state of gloom and doom. This is not the case. We have only to look at the material growth of our gross national product since this government has taken office to ascertain that such is not the case. I cannot state the statistics exactly, but I suggest our gross national product has gone up approximately from $30 billion to close to $40 billion under the present administration. What do they do with this statistic? They seize upon the percentage. This will not work.
When the hon. lady began this debate this afternoon, I could not help feeling she was touching upon what might be considered to be Canada's version of the new frontier policy. Well, she and almost every Canadian today have great admiration for the vigorous president who is leading the United States in difficult times both at home and abroad. I do not say this in a self-satisfied way, but I should like to reiterate what has been said time and time again, that the new frontier policy employed in the United States, that

policy which was dedicated to helping move the United States forward, as I am sure the hon. lady would have liked to say, was taken from programs already initiated in Canada. I ask all hon. members, then, what a paradox. We see the Canadian government initiating policies in relation to trade matters, financial matters, housing problems, winter works problems, which in turn were incorporated into the new frontier policy. What a paradox it is that these very policies the hon. lady has commended have gone from Canada to the United States and, I do not say this in a self-satisfied way, have come back again only to be praised by hon. members of the opposition.
The hon. lady mentioned the fact that during the last presidential election in the United States, the gentleman who is now president, in his campaign said that the United States was not moving forward quickly enough or at a fast enough rate. The hon. lady referred to lethargy both at home and abroad and said reference was made to that in the presidential campaign. In doing so she said that we on the government side of the house should not be too critical of the opposition when they criticize us. However, I should like to say with all the force and sincerity at my command that at no time during that presidential campaign did any member of any political party sell his country short at home and abroad in the same way as members of the Canadian opposition have been doing for the last three years.
I would be the first to admit that the presidential campaign evolved around this notion of lethargy at home and abroad, but I would repeat again and again that this planned campaign of doom and gloom at home and abroad was never employed by members of political parties across the border in the same way as it is now being employed by members of the Liberal opposition, both inside and outside the Canadian House of Commons.
The hon. lady also mentioned the president's initiative in relation to a department of urban affairs. However she did not mention the fact that this initiative was meeting with more than a modicum of difficulty in the United States congress, and I would like to bring that fact to her attention. I do not believe I am going too far out of range when I say that time and time again, both inside the House of Commons and outside it, I have hoped that a department of provincial and municipal affairs could be seriously considered by this government, particularly because this government has taken the position of the provinces and municipalities more seriously and has done more to better their

Alleged Lack of Economic Growth
affairs than any other government. No government has done more than the present Progressive Conservative administration in that respect.
The hon. lady also mentioned an advisory council and I listened to her proposal with great care. She said there was an emergency, that we needed action right away, not tomorrow or in years to come. She said we needed action to move Canada forward now, but all she had to offer was an advisory council. No member of the opposition will point out the difference between such an advisory council and the present productivity council which is already performing on the Canadian scene. But you know, sir, when the experts write your speeches for you, when the experts are not in touch with the people in the House of Commons and really do not know what is going on, when all you do is to pay a little trip to the top of the ivory tower and come down and make your speech, then you find that very often errors of this nature are made. As was the case today, debate becomes difficult for the opposition when all they have are prepared speeches. I have a great respect for experts when they play their rightful roles in the economic and political scene, but today the House of Commons is being treated to a most unique type of debate. We have had opposition by press clippings, and now we have opposition by speeches prepared by experts and quasi experts.
As I look over at the empty opposition benches I am quite sure that the hon. members who have just made speeches are not upstairs correcting them because speeches that are read, speeches that are prepared by the experts and quasi experts in the ivory tower, need very little re-editing, but they do not do much to enhance the pith and substance of debate in this house.
The other day the hon. member for Bona-vista-Twillingate took it upon himself to lecture the house-


John Whitney Pickersgill: I am rising on a point of order and perhaps the hon. gentleman will say that in doing so I am lecturing the house again. But, we are carrying on a debate on a motion, an amendment and a subamendment, and not on the method by which the mover of the amendment prepared her speech. Evidently because he has nothing to say himself, the hon. member has spent most of his time making insinuations about the way the hon. lady prepared her speech. I believe it is the rule of the house that we assume, unless there is concrete evidence to the contrary, that every hon. member prepares his or her own speech, and I suggest the conduct of the hon. gentleman is not only ungallant but not parliamentary.


Mr. Speaker:: In so far as a point of order is involved in reference to the reading of previously prepared speeches, the point should be taken at the time the speech is being delivered.


William Heward Grafftey: The hon. member who has just taken his place took it upon himself to continue to give us a very forceful lecture on the role of a government in the Canadian scene. He said a government is only normally tested when there was some major issue involved-


John Whitney Pickersgill: You are breaking another rule by referring to a previous debate.


Henry Frank Jones: On a point of order, the hon. member for Bonavista-Twillingate should rise in his place when speaking. He is not even in his own place.


Mr. Speaker:: I would ask the hon. member for Bonavista-Twillingate not to speak without rising.
Grafftey: I am sure all hon. members will agree it is incumbent on members of the opposition to produce these so-called large issues for election purposes, but the hon. member for Bonavista-Twillingate said one of the tests that a government must stand up against is how well has it governed the country. Hon. members of this government and its supporters are going to stand up to that test. Our record is going before the people and we shall be judged by it. However, after today's performance by the opposition there is one test I feel the opposition should face, and that is that they should prove to the Canadian people that they have a logical and responsible alternative government for them. On the basis of their performance today I say the opposition do not have a responsible alternative, if any alternative at all, to put before the Canadian people.


Mr. Speaker:: If the hon. member would find it convenient to discontinue his address at that point, then I call it six o'clock and leave the chair.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 8 p.m.
William Heward Grafftey: Before the house recessed I mentioned that the hon. lady who opened this debate had said that in her view this country was not moving forward fast enough in an economic sense. The paradox that I think should be put before the house is this: she cited the energetic proposals

Alleged Lack of Economic Growth which had been placed before the nation to the south of us; she cited the energetic proposals placed before the United States by the president of that country. We are not supporters of a government which believe it has a cure for everything, but I repeat that the administration in the United States did, in the course of its frontier program, make use of many of the programs which had already been initiated by the present government. This is a fact. Thus we have a curious situation: we see policies and programs criticised by the opposition when they are initiated in Canada being adopted by the administration in the United States, at which point they are praised by the opposition in Canada. That represents, surely, the most amazing about-face that anyone in Canada has seen for some time.
Another thing which I think should be drawn briefly to the attention of hon. members is this: the hon. member for Bonavista-Twillingate took it upon himself the other day to lecture us on the proper role of a government. He said: if there is no major issue which can be brought forward, the government must be judged on its record.
I agree that this government must be judged on its record; it is a record which everybody in Canada will recognize as a good one. I, in turn, would like to tell the hon. member for Bonavista-Twillingate that oppositions also are judged on their records; they must produce these great issues to which reference has been made. So far in the last four years, they have produced none. They are trying to seize an issue in this supply motion today but I cannot recall one single significant national issue which the opposition has brought forward in all these years. Another thing which an opposition must do is to supply a reasonable alternative to the Canadian people. They must be in a position to be able to say to the Canadian people: if we, the opposition, turn the government out we have a logical and sensible alternative. After listening to the treatment which the opposition have given to this supply debate today I cannot see even the beginning of a serious proposal which would form such an alternative. tTranslation1 :
Mr. Speaker, I must admit that the hon. member for Niagara Falls (Miss LaMarsh) said some interesting things in her speech. She mentioned the efforts of the president of the United States to set up a department of urban affairs even though this project has oeen blocked until now by the American congress.
Now, only a few days ago, I suggested myself in this house the establishment of a
[Mr. Grafftey.l
body whose duty would be to look after provincial and municipal affairs. No other government has ever done more than the present government, under the able leadership of the Right Hon. John G. Diefenbaker, for our provinces and municipalities.
I do not say that we have given everything to the municipalities and provinces, but at least we have given recognition to their rights.
As I said earlier, Mr. Speaker, I think we should give serious consideration to the establishment of a municipal and provincial affairs board. In my opinion, such a board should come under the Department of the Secretary of State because, after confederation, it was that department which was charged with looking after federal-provincial relations.
Mr. Speaker, our municipalities are in for great developments in the future. Under the constitution, municipal affairs are considered as a provincial responsibility. For that reason, I may have to suggest another name for the agency I have in mind.
We have several joint programs. I think federal-provincial joint programs could be co-ordinated under such an agency. Each program would then come under the jurisdiction of the department concerned.
The present government has done much to acknowledge the rights and needs of our municipalities. I am thinking especially of housing programs, winter works programs, etc.
That is why I feel we should give serious consideration to the establishment of a municipal and provincial affairs board.
(Text):
As I have shown, hon. members in the opposition had great difficulty in presenting us with a logical alternative. If there was an alternative which they were capable of presenting to us, it was an alternative highly characterized by an elaborate system of bureaucratic control. I, for one, do not wish to gaze into a crystal ball like some members of the opposition. I have heard various suggestions concerning what the main election issue will be but I feel one thing is obvious to all hon. members. As I said in this house a few days ago we cannot become involved in the classical debate of free enterprise versus socialism. I believe, and perhaps many hon. members share my belief, that it is a question of degree.


John Whitney Pickersgill: Will the hon. gentleman permit a question?

Alleged Lack of Economic Growth


William Heward Grafftey: At the conclusion of my remarks.
In the 1957 election the Canadian people made it clear that they wanted government returned to the people in the Canadian House of Commons. The hon. member for Niagara Falls discussed the possibility of free enterprise versus socialism being a debating topic in the forthcoming election.
In 1957 the Canadian people, while recognizing that the civil service of this nation is second to none, took the position that the government of the day was to too large a degree governing by order in council, permitting far too much bureaucratic control to creep into the government of this country.
It was amusing to hear the dialogue in the house this afternoon. A wonderful debate occurred on the meaning of the word "planning". The socialists advocate planning in one way and the Liberals in another. I have always said the whole opposition can be lumped together. Just the other day one hon. gentleman jumped from the socialist camp into the Liberal camp. There was a slight discussion in the press about personality differences but I suggest the transition is easily made these days because those who advocate a high degree of bureaucratic control masked as planning are really advocating the same thing.
I will not pretend that the question of appropriate degree is a simple matter but the government I support believes that the individual is more important than the state, that the state exists for the individual and not the individual for the state.
Hon. members opposite be they socialists or Liberals are advocating bureaucratic control, but their arguments are not always forceful. When I heard the new leader of that little group in the far corner of the chamber speak today in those terms of watered down socialism I said to myself, "Gone are the days of the fire and brimstone of the Regina manifesto". They never talked about nationalization. My hon. friends kid us about turning our back on the free enterprise system. We have always stood for the free enterprise system and we have always let the Canadian people know where we stand. Those pronouncements which emanated today from the hon. gentleman in the far corner are a far cry from the fire and brimstone of the Regina manifesto. Where was the call to real militancy?
The hon. gentleman said there was a large area of agreement between the Liberals and socialists. Such is the degree of agreement that, as I said, just a few days ago one hon. gentleman jumped from one bed into another.


An hon. Member:: Oh well, they say a change is as good as a rest.


Mr. Halpenny:: Polygamy.


William Heward Grafftey: There was no doctrinaire debate about the hon. gentleman's defection. The attitude taken was: I was unhappy in the old bed so I am going to try a new one. Gone are the days of fire and brimstone and lines of clear demarcation. It became perfectly clear in the debate this afternoon that both opposition parties are advocating a high degree of state control, the very thing the people rejected in 1957 and will again reject in 1962. When the Canadian people gave a mandate to the present administration they were putting back in the House of Commons the voice of the people of Canada, and it is here to stay.
When I look at all the horsemen on the front benches of the Liberal party-


George Harris Hees: That's the nicest way you could have put it.


William Heward Grafftey: -what do I find? One would have thought that finding themselves out of office the Liberals would have put in the front benches people who would have attempted to get close to the grass roots. Instead, on the front benches we find the same old experts and former civil servants who were prominent on the front benches when the Liberal party formed the government. Experts and civil servants have a valuable role to play in their appropriate place but the hon. gentlemen who sit on the front benches of the Liberal party are far removed from the people.


Michael Starr: They are in the same old rut.


William Heward Grafftey: Yes, we have the same old faces. They have assumed leading roles in the opposition and instead of getting down to the grass roots and attempting to determine the needs of the people, the wishes of those they represent the Liberals have surrounded themselves with these ivory tower experts.
If there is anything this debate is making clear it is the lack of difference between the opposition parties, and the genuine difference between them and the present government. Differences should not be brought to the attention of the Canadian people just for the sake of doing so. But the difference is there. The Liberals and socialists are today advocating a high degree of state intervention and bureaucratic control in critical but peacetime years. The Canadian people will not tolerate this. As long as I hold my seat in this house I will fight for the principle that the state must not be placed before the individual.
The hon. member for Niagara Falls said what was needed was an immediate stimulus

Alleged Lack of Economic Growth for the economy. In her remarks she came out fighting and I expected to see everybody in the opposition file in behind her and fight with her. She proposed a shock treatment for the Canadian economy. The measures, both long term and short term, introduced by this government are having an immediate effect on the economy. A former minister of trade and commerce stated that these problems could not be solved by the palliatives of doctrine but must be attacked on a day to day basis realistically, problem by problem. What do hon, members of the opposition do when the government introduces measures designed to meet the problems confronting us? They isolate each measure and claim it is the only thing we have up our sleeve. They state it is too little and too late. They refuse to recognize the integrated attack the government has made on the complex problems confronting us.
The government does not claim that any measure it has introduced is a cure all but taken as a whole the measures introduced represent a means of assisting this nation to attain its long term economic and national objectives.
Hon. gentlemen opposite like to use the word "planning". I am not fully certain what kind of planning the Liberals stand for as opposed to the socialists. But I know that all hon. members regardless of party affiliation recognize that whether we like it or not-some like it and some do not-the government has a role to play in the economy, a responsibility to accept. Whether that role is large or small the government must realistically discharge its obligation and plan the means of doing so. I will be the first to admit that. This discussion of the word "planning" is merely a play on words on the part of hon. members opposite. The government has never hesitated to admit it has this responsibility to discharge in moving the economy forward. This government has done more than any previous government to recognize the needs of the provinces. In fact, our deficits in the last few years can be measured against the increases in subventions and assistance to the provinces. We recognize that roads, schools, highways, hospitals, etc. must be built. I am not suggesting that the government is doing the municipalities and provinces a favour in offering them assistance. The government is realistically tackling the problems confronting our provinces and municipalities.
Hon. gentlemen opposite produced no evidence of any difference between their advocated so-called advisory council and the government's productivity council. No government has done as much to provide leadership in planning and co-operation between

all levels of government, and in agriculture, and between labour and management. This is imaginative and real-


John Whitney Pickersgill: Imaginary.


William Heward Grafftey: The leader of the new party in round and august terms mentioned social justice and said that they stood for social justice. I should like to say that we are just at the beginning of a session which has passed some of the most far reaching social justice measures ever seen by the Canadian people. I refer to pensions of all kinds and social justice measures of all kinds. It was the same in the old world. Prime Minister Disraeli of England often said that the socialists and Liberals talked about social justice but it took good Conservatives, men such as Shaftesbury and Disraeli to come along and actually deliver the goods. Hon. members opposite are talking about social justice at a time when some of the most far reaching social justice measures have been put before the people of Canada.
(Translation):


Mr. Denis:: Tell us about the two flags.


William Heward Grafftey: The hon. member wants me to talk about the two flags. Well, I will tell you one thing, Mr. Speaker. While our friends talk about two flags in the province of Quebec-


Mr. Pigeon:: Six flags.


William Heward Grafftey: -three, four, five and even six flags in the province of Quebec, we, of the Conservative party, have only one policy for all Canadians, the same policy for every province.
(Text) .*


Azellus Denis: What is your flag? Tell the people of Canada what your flag is.


William Heward Grafftey: It certainly will not be the "no flag" produced by hon. members opposite after 22 long years in office.


Azellus Denis: What is yours?


William Heward Grafftey: Twenty two long years in office and they will be more than 22 long years in opposition.


Azellus Denis: They will not be 22 long years in opposition.


William Heward Grafftey: The Minister of Trade and Commerce brought before all members of this House of Commons results in relation to Canada's trade position in the world today. Hon. members in very general terms have criticized our attitude toward the common market and in very general terms have indicated they are in favour of free trade. However, I should like to ask them this question, and I put this point to them in clear terms.

Would they have had the present government not put forward the Canadian point of view both at Accra and in London when England sought and seeks membership in the common market? I am led to believe, in fact, by what I hear, that the British authorities are very glad to have the Canadian point of view so ably stated, something which helps our and their position in every way as they seek entry into the common market.


John Whitney Pickersgill: That is a raspberry.


William Heward Grafftey: The hon. member for Bona-vista-Twillingate says that is a raspberry. They have just thrown up a smokescreen, a hysterical smokescreen.


Michael Starr: They never spoke up when they were able to do so.


William Heward Grafftey: The present government did speak up. As England seeks membership in the common market the Canadian government diplomatically, clearly and forcefully stated the consequences for Canada and the considerations that should be considered by the British authorities as they sought entry into this very worth-while organization. Would members opposite have wanted the authorities of the Canadian government not to have put the Canadian case forward? I say no. I challenge them to state a real reason for their two-homed opposition to this question.
I simply say that the measures that the present government are putting before the Canadian people are having an immediate affect. The hon. lady read a long document and not once did I observe a measure that would have an immediate affect on the economy. We have had speech after speech written by the experts and read by members opposite. These have been inflicted on this House of Commons but they have contained no immediate solutions. I am not saying that this government has all the answers. What I am saying is that this government has played its part in the responsible role of a federal authority in co-operation with the municipalities and the provinces, ft has played its imaginative and dynamic part in helping to move Canada forward to its long and short term national goals. The Canadian people in a very short time will recognize this record. They will also recognize the type of opposition put forward in debate such as that which we have had this evening by the opposition. They will recognize that the opposition have not produced a major issue. They will recognize that the opposition have not produced a logical or serious alternative. They will recognize that the opposition, be they socialists or Liberals, advocate that degree of state control which is abhorrent to Canadians, a degree of state control which they rejected a few years ago and 26207-1-82
Alleged Lack of Economic Growth are going to reject again. I think the people should know it for what it is. I am glad that the opposition have been talking in the way in which they have been talking.


John Whitney Pickersgill: The hon. gentleman was kind enough to indicate that he would answer a question of mine at the conclusion of his speech. I should like to put this question to him. When he said that there was not an issue between free enterprise and socialism, that it was a matter of degree, has he put that view to his leader the Prime Minister, who says there is such an issue.


William Heward Grafftey: I answered that question very clearly. I think all Conservatives today realize that the debate is a question of degree. The old debate with regard to free enterprise versus socialism and the bitter struggle of the "haves" against the "have nots" and class warfare which took place in the old world is not taking place today. That is why I believe so many of their doctrines go out the window so to speak. I believe that all Conservatives in their heart of hearts recognize that it is a debate on degree. We are much closer to the free enterprise opinion than the hon. member.


Mr. Deputy Speaker:: The hon. member's time has expired.


Herbert Wilfred Herridge: Would the effervescent hon. member-


Mr. Deputy Speaker:: Order. The hon. member's time has expired. I recognize the hon. member for Burnaby-Coquitlam.


Mr. Erhart Regier (Burnaby-Coquitlam):: Mr. Speaker, I am sure all of us were most interested in the delivery of the speech made by the hon. member for Brome-Missisquoi (Mr. Grafftey). I agree entirely with the hon. member for Bonavista-Twillingate (Mr. Pickersgill) that it might be advisable for the hon. member who has just spoken to have had consultation with his own political leader. We remember only too well the election challenge which was issued. If he really means that it is a matter of degree I would recommend to the hon. member for Brome-Missisquoi that we might manage to find room for him in our particular corner. However, the hon. member admitted that planning was necessary while at the same time he contradicted himself when he warned against the bureaucrats and against the state. I should like to think that the state and the individual are not two separate entities. I should like to believe that the state represents a group of individuals acting together as an entity. I believe that this continuous harping on potential bureaucrats
1280	HOUSE OF
Alleged Lack of Economic Growth is an insult to the integrity of the civil service we have in Canada at the present time. Attempting to build in the minds of Canadians the concept and the fear that the state and the civil service is something which is necessarily evil and which must be avoided at all costs I feel is not doing a good service to the development of either the Canadian nation or the welfare of the Canadian people.
The Liberal amendment is one that, taken at its face value, could almost be agreed to by any political party in Canada. In effect all it calls for is an increase in the rate of economic growth in the country. I believe I have even heard members of the government admit that in the interests of resolving the problem of unemployment every effort should be made to increase the rate of economic development. The issue is not whether an increase in the growth rate is desirable; the issue is the manner in which we desire to increase the rate of economic growth.
I agree entirely with the hon. member for Niagara Falls who moved the amendment, that the problem of the growth of the economy is likely to be one, if not the major, election issue. The Prime Minister has told us in no uncertain terms that in his opinion the election issue is going to be free enterprise versus socialism, which to my mind is merely another way of saying very much the same thing as was said this afternoon by the hon. member for Niagara Falls about the potential election issue. However, we would be interested in discovering from either the Liberal or Conservative parties, or both, the manner in which they propose to increase the rate of economic expansion of our country.
According to my observations the Conservative remedy seems to be a patchwork of reforms and the instigation of economic activity through the winter works program, which is highly desirable and most beneficial, and vocational education, which is equally desirable if not much more so in the long run; but according to the observations of this group there appears to be no major or massive planning designed to give the whole economy of our country the lift that it so badly needs. As a matter of fact, in the main the Conservatives seem to reiterate the necessity of maintaining what they choose to call the free enterprise system but which in my books, having in mind the force that every government has and must necessarily have, is nothing more than the use of force to maintain the status quo. In my view this has always been expressed most neatly by simply saying that we live under a dog eat dog system wherein everyone to the maximum possible degree is allowed to do


exactly as he pleases, without regard to the public interest, and wherein there is really no genuinely free enterprise. It is very much controlled enterprise but controlled by corporations and powerful interests who are not necessarily held responsible for the public welfare as a whole. The Tories have yet to show that they have any intention of making the powerful economic interests in Canada raelly responsible to the over-all interests of the Canadian community.
We have lived through enough years of Liberal economic policy to recognize this debate for what it is. Yes, they will speak in the language of New Democratic policy but they will not dare to come out with specific remedies. They will not say by what method they will increase the tempo and the level of economic activity in our nation. The hon. member for Niagara Falls mentioned a few possibilities. Mind you, Mr. Speaker, she did not advocate that these remedies be applied in Canada, but she did hold up to us certain examples of what was happening in a number of other countries in the world. She mentioned tax concessions and tax exemptions. This reminded me of the tax free holidays granted to multimillion-dollar corporations, of which I have seen far too much in recent days, and which in the long run mean only the exploitation of resources and of people, with nothing left behind to show for it.
Is it the policy of the Liberal party to offer tax free holidays of five, 10, 20 or 30 years to exploiters so that they may come to Canada and give us work in order that our human resources can be applied to our natural resources? I think the Liberal party owes an explanation of what they mean when they speak of potential tax concessions, tax exemptions and reductions in taxation. Is this the catering to big business in which the Liberals indulged so liberally during their heyday in Canada? We know what it means in the long run. When corporations are given a free hand and every encouragement to invest here and to do as they please in our country, especially when non-Canadians are invited to do so, it means that we have an economy of boom and bust.
Under the circumstances existing in our country at the moment I am quite willing to concede that if the Liberals and Liberal candidates already nominated were to take the reins of office, unemployment possibly could be eliminated. However, I should like to ask them, how many unemployed will we have five or ten years hence when the long term efforts of their shortsighted policies make their influence felt? After the kind of

policies they are now advocating were enforced by the former Liberal administration, and they ran into a snag, they resorted to the remedy of confiscation of the savings of the people in that they deliberately permitted inflation to rob the hard-earned savings of ever so many Canadians, which has now brought about very serious additional problems in Canada.
If we want to increase production we must also consider the means by which we increase the level of economic activity in our nation. It is very hard for me to determine which comes first, the chicken or the egg, with reference to the financial structure prevailing within our country. I contend that an organized financial house, nationally speaking, is one of the major needs so as to increase national production. It is said that money is the root of all evil. An ordered financial house might be a great blessing at this time to the vast numbers of unemployed and to other Canadians who are in need.
If the government is looking for additional revenue in order to implement this objective, I would highly recommend that it reverse its present policy, begin to pursue a policy of the ultimate maximum production in which our people are able to engage and end its advice to various segments of the Canadian community to reduce production in order to maintain artificially high prices. To me such advice is not only immoral but in the long run I feel it is also harmful to the welfare of our people. The problems of Canadian agriculture, for example, will never be resolved by a policy of advising our farmers to reduce their levels of production if they want to maintain existing price levels.
If the government wants to put its financial house in order it ought to pay some attention to what is happening in the field of foreign investment in Canada. I am not necessarily opposed to Canada welcoming investment on the part of people living outside our borders. However, I find it a little difficult-and I do want to add this qualification-to understand how we can expect world peace in the long run if we, one of the wealthiest nations of the world, on balance are importers of capital. I believe we have a moral obligation to the development of peace and prosperity throughout the world to become, on balance, an exporter of capital instead of depending for our prosperity on an unfavourable balance in the matter of foreign investment.
We advocate the establishment of a federal investment board. If we want to have economic growth, we cannot afford to allow those who have investment capital at their disposal to invest it wherever it happens to please them, without regard to the investment needs 26207-1-82J
Alleged, Lack of Economic Growth of other segments of our society. I am very impressed by what is happening in a goodly number of other democratic nations in the world, where each year responsible officials assess the likely investment needs of their national government, of local governments, of quasi government agencies and of private enterprise. After assessing the likely national needs, they then get together and assess the possible investment capital that can be raised through the government and on the open money market. Then they arrive at an agreement, a compromise or an understanding, and in a number of cases the levels of government do not all run to New York to begin cutting each other's throat, begging the money-lenders in New York to buy their bonds.


Henry Frank Jones: Mr. Speaker-


Erhart Regier: I have only a limited time.


Henry Frank Jones: Perhaps if the hon. member would tell us to what country he is referring.


Erhart Regier: I hope I will be able to hear the hon. member some other time. I understand that in the commonwealth of Australia there is an annual gathering of all three levels of government. They agree upon their essential investment needs, then the government of the commonwealth goes on the market and obtains this money, allocating it to the other levels of government. This kind of policy would save our municipal and provincial governments millions of dollars of needless interest. This is the kind of policy that our party would support. We believe we should go even beyond that, call in the private investment sector and act in consultation with it. I believe we must enlarge very greatly the role of the Bank of Canada in our nation.
At the time the Bank of Canada was originally conceived, our chartered banking system was the major source of capital within our country. Today, however, they are no longer the major source; they are very much the minor source. Even our credit union movement in Canada authorizes investments that are already close to one third of the volume involved in the operations of our chartered banks. Our insurance companies have powers vastly exceeding those of the chartered banks. I am not making a speech against the chartered banks. We have our central bank which is in constant consultation with the chartered banks. I believe the Bank of Canada is largely fulfilling the purpose, in this respect, for which it was originally designed. What I am saying now is that there are many other financial institutions operating on the Canadian scene whose operations largely offset the good intentions of our Bank of Canada in the monetary world. It is high time, as was advocated by Mr. Coyne in his controversial

Alleged Lack of Economic Growth report to the Minister of Finance (Mr. Fleming), that the minister considered the limitations under which the Bank of Canada has to operate at the moment. The former governor of the bank pointed out the other influences which had grown tremendously within recent years. I hope that the government will give very serious consideration to at least this aspect of the report of Mr. Coyne.
I hope that no one will assume, when I say that we must set our financial house in order, that either I or this party at any time advocates pressing the button to start the printing presses rolling. This would be against our basic principles. We believe that the amount of money in circulation is not only a matter of convenience but it has much to do with the bringing together of the human and natural resources; with the exchange of goods and with bringing in the purchasing power of those people who have been able to save, to the advantage of national development and employment. Many people will argue that when the last world war started the government very quickly found the money necessary. It ought to be obvious that we paid for that inflation, the inflation of our currency which was necessary for our participation in the war effort. The inflation of the savings of our people since the war has made us realize that to start the printing presses rolling, while it was urgently required at the time, was not helping to solve our problem in the long run.
We believe also that the government, to set its financial house in order, must return interest rates to at least the level they were when this government took office. I hope that some day financial experts will assess the tremendous cost to the Canadian people, in ever so many ways, of that deliberate increase in interest rates that was foisted upon the Canadian people and the Canadian economy. I hope they will be able to assess, with some reasonable accuracy, what the cost has been to the Canadian nation. I should like also to plead with the government to do everything it can and be at all times conscious of the need for it to remain completely sovereign over its monetary policy.
We are always willing to co-operate on the international level, but it is important, if a nation is going to be economically independent, that it also have complete control over its own monetary policy. I am not too sure that this has always been so in the past. As an aside to my remarks on finances, I should like to underline my opinion, expressed on other occasions, that before proper economic development in Canada can become a reality, we have to realize that our concept and structure of tariffs is completely outmoded.

There are only a limited number of nations in the world that have retained this government's attitude.
Now, I want to say one word about aid to the underdeveloped areas. I know a lot of Canadians will say, why not look after our own people first; charity begins at home, and the like. I would like to appeal to these people that aid to underdeveloped areas in Canada is the right thing to do, and we should do it primarily because it is the right thing. However, it is also very important for the maintenance of world peace, and particularly if we mean what we say, that we want to block the spread of communism, that we increase the level of our aid to underdeveloped areas. Apart from that major consideration, aid to underdeveloped areas will in very direct ways supply a boost to the Canadian economy and will supply employment for our people at home. When our manufacturing plants produce machinery that is used in Kenya or India then our workers have better chances of employment.
On this occasion Canadians are not going to be stampeded into a period of boom by Liberal policies of tax reduction and tax incentives, with ruthless exploitation of natural and human resources leading to increased foreign ownership and control, producing large surpluses and a depressed agriculture. As a socialist I am a conservative-with a small "c"-in this attitude, namely, that it is the height of irresponsibility to say "here are the people and they have the know-how; here are our tremendous natural resources; please come over and exploit us for our short term benefit and your profit".
The words "conservation" and "orderly development" are becoming ever increasingly important to the Canadian people. This time Canadians are not going to be stampeded by Tory hero worship, by high rates of interest, by financial concessions to the financial institutions, by more slick exploitation of national consciousness, by huge election war chests and the politics of sheer political expediency. This time a growing number of Canadian people will realize that if we are going to live as one happy family in Canada then we have to start behaving as members of a family. As members of one family we ought to be prepared to explore and assess our natural human resources. Then we shall have to decide on our needs and limitations, and how those human resources can best be applied to our natural resources so that the maximum number of our people will be able to enjoy employment and the social security they need so badly.

The federal government of Canada is the most powerful economic interest that the country has. We must recognize this, and we must also recognize that the government has a responsibility as to what happens to the economic destiny of our people. We must recognize that the people as a whole must decide to use this instrument of government that was designed for them out of the sacrifices of their forefathers. This instrument was designed for the people and the people must use it to determine their own economic destiny as they have hitherto been using it to determine their political destiny. I am therefore happy to support the amendment to the amendment proposed by my house leader.
Mr, R, C, Coates (Cumberland): I would have anticipated a more realistic approach on the part of the opposition to this first supply motion especially when one considers that most if not all the economic indicators of importance point to a strong upsurge in our economy. Instead we continue to hear the old tale of woe, the old tale that has come from that side of the house since 1957. Unfortunately they have been unable to separate their hopes from the realities of today.
I think all hon. members of the house remember the Templeton doctrine-high unemployment means good times for the Grits because they are in opposition. In fact that seems to be the underlying plan on the part of the opposition, and has been ever since 1957. Unfortunately for them this has not happened. Their predictions have not come true and they have not come true for a very good reason- because this government took the action that was needed to put our economy back on the road to success. If the Liberals do not soon remove themselves from this fools' paradise in which they live, then they will soon discover that the defeat of 1958 is only a taste of what they are going to get later this year.
It is a constant source of amazement to me to see hon. members from the Atlantic region, who were in this house before 1957, rise in their places and speak of doom and gloom in our economy when comparing our part of the country with the wealthier provinces in Canada without at the same time mentioning, even in a passing way, the many tremendous things that have been done by this government to lift our economy up and put us on the road to recovery, and to greater heights than we could have ever anticipated had we remained Liberal, with a Liberal government in office. One has almost to assume that they are not aware of the changes that have taken place. They, like the remainder of their party, also seek the solitude of this fools' paradise in which they choose to live.
Alleged Lack of Economic Growth
It must be that the members of the opposition from the Atlantic provinces have adopted the premise of "Maritime Gordon", one of their supporters who is presently preaching for a call he will never receive. He had a quick solution. The Liberals have been talking about shock treatments and he was going to give the Atlantic provinces a shock treatment. He was going to give that treatment to the people living there. He was going to give them one way tickets, straight out. This is separatism in reverse. Of course we in the Atlantic provinces know that Liberal thinking, when that party was in office, stopped short at the borders of Quebec. They never went beyond. We can all remember that former great Liberal prime minister, the Right Hon. Mackenzie King, saying "not one 5-cent piece for the maritime provinces." That is one promise they kept.


An hon. Member:: They sent them Pickersgill
instead.


Mr. Coates:: It is appalling for any member from the Atlantic provinces to ignore the Atlantic provinces adjustment grants and his constituents should give him the treatment he deserves. I look forward to most of them receiving it. We blanked them in two provinces in the last election and it will be a complete sweep the next time if they continue the way they are now.


Mr. Caron:: Whom are you trying to make happy?


Robert Carman Coates: Let me tell you, my friend, you won't be very happy when the next election is over. These Liberal representatives from the Atlantic provinces seem to have been brainwashed by this talk about gloom and doom. They don't even know what has been done, and for that reason I would like to put a few of the facts on the record, if they do not know them they may be able to read of them and appreciate them.


John Whitney Pickersgill: Like the digging of the Chignecto canal.


Robert Carman Coates: I have already mentioned the special adjustment grants-adjustment grants which will by March 31 of this year have poured $100 million into the Atlantic area. But we are not cut off at this point. We are not told: this is the end of it. No, Mr. Speaker, we are to get $175 millions more over the next five years. That is the type of treatment this government is giving to the Atlantic provinces.
As a representative from Nova Scotia I need go no further than my own constituency to see the tremendous growth in the economy that is apparent throughout the province.


John Whitney Pickersgill: In Springhill, for example?

Alleged Lack of Economic Growth Mr. Coates: All right. The hon. member mentioned Springhill and I am very happy he did so. Let us compare Springhill with the Pictou area which my hon. friend the present member for Pictou has done such an outstanding job of representing since he came to the House of Commons. I will tell you, my friends what you did for Pictou county. You closed coal mine after coal mine and the only solution you found was that offered by "Maritime Gordon"-move them out and give them one way tickets. That is your solution. Now let me say this: my hon. friend from Pictou county has worked, and his work is paying off. Almost every day we pick up a paper and see that something else is coming into Pictou county. Not long ago a new coastguard cutter went into the shipyards. Then, the other day there was a $2,300,000 car order. That is the type of representation the people of the maritime provinces have been looking for for years. If there had been a Liberal party in power in 1958 when this great disaster struck Springhill and took its only industry from it, leaving 7,000 people without an industry of any kind, there would have been a one way ticket for these 7,000 people. That would have been the Liberal solution to this problem. Instead, what has happened? The people of Springhill have four new industries. They have a minimum security penal institution. The Minister of Justice recently informed me that we were going to have a new medium security institution, the estimates for which were running as high as $2,500,000. This is an institution which would probably employ 125 people.
It does not stop there. This government, in co-operation with the government of Nova Scotia, has made available to the people of Springhill $450,000 in hospital grants so that they may build themselves a new million dollar hospital. Further, the Department of Public Works now has on its drawing boards a new federal building for the town of Springhill. In addition, Industrial Estates, a crown corporation set up by the Nova Scotia government under its great premier Bob Stanfield is prepared to investigate, and will investigate, every possible industry which can go into Springhill and into every other area of Nova Scotia. That is what was done for Springhill, since the hon. member asks, and let me tell him there will be more done as long as we have a Conservative government in Ottawa.
There are so many things that have been done for the Atlantic provinces that one does not really know where to begin or where to end. What I am trying to do is to put down a few of the things which I feel are of

real significance and which should be considered by some of the members of the opposition. If they did, then they, like some members of other parties, might begin walking across the floor as well.


Lester Bowles Pearson: We shall all be walking across shortly.


Robert Carman Coates: When they are so blind that they cannot see in front of them I guess we do not really want them; we can find better people ourselves.
Federal payments to Nova Scotia have more than doubled since 1957 from $31,336,000 to $67,928,000. Does this indicate the type of government the Liberals wish to provide? Our wages and salaries have notably increased. Our wage earners are receiving more than $1,500,000 a day every day, 365 days a year. In 1956 they received $440 million; the figure is now running at a rate of $593 million per year. For every $3 they received in 1956 they are now receiving $4. If hon. members want to look at it in another way, it took the wage earners 89 years to get up to $3 and only five years to get it up to $4. Is this the type of progress the opposition opposes?
Let us look at another field in which the opposition should have taken great strides in 1945-the field of vocational training. Hon. members opposite knew that we would be faced with this problem. It was all in the hidden report. But like so many other things that are distasteful, it was hidden away. Whenever there is something that does not fit in with their plans they put it on the shelf- they put it somewhere, where they cannot see it. In 1945 they should have been taking steps to see that the people of our country were trained so that when this technological advance came upon us our people would have been ready to step into the new jobs open for them. But they did nothing or next to nothing. In 1956 the Liberal government of that day paid its share of vocational training to the government of Nova Scotia. It amounted to $420,000. In 1961-62 that share will amount to $1,795,000 and next year, with vocational training schools under construction in every area of our province, it will be even greater Over the past six years the contribution of the federal government to vocational training has been $4,200,000. Of that amount the Liberal government provided ten per cent and we provided the other 90 per cent.
Let us turn to another promise, because the Liberal party is becoming a very promising party at the present time. Let us turn to hospital insurance. In 1919 the Liberal party promised the Canadian people that they were going to provide them with hospital insurance.


John Whitney Pickersgill: That is not correct.


Robert Carman Coates: I do not suppose it is.


John Whitney Pickersgill: The record was put straight the other day as the hon. gentleman knows.


Robert Carman Coates: The hon. member is always putting the record straight in order that it may please him.


John Whitney Pickersgill: I read the resolution.


An hon. Member:: Just forget the past.


John Whitney Pickersgill: I put the facts on record.


Robert Carman Coates: The hon. member for Bonavista-Twillingate wants to go back to the past. He is one of the very few members of that party who will undertake to do so. I do not think his leader agrees with him there, but then there are times when the four horsemen do not agree.


Lester Bowles Pearson: That is when we go to Quebec.


An hon. Member:: Under which flag?


John Whitney Pickersgill: That is what we would like to know. Which flag was it-Fleming or Dief-enbaker?


Robert Carman Coates: The hon. member will not get out of it so easily. One would assume that after what the Leader of the Opposition went through in the town of Amherst when being questioned about what has been described by some of his friends in the press gallery as a cocky, immature young man, he would have stopped talking about the flag, because he showed that day that if he could not handle that cocky immature young man, where would the Canadian people be if they put their faith in him as their leader?


Lester Bowles Pearson: With his faked report.


Robert Carman Coates: It only becomes vague when you start reading the facts.


Mr. Winkler:: Whose face was red?


Robert Carman Coates: I return to the subject of hospital insurance. I do not blame the opposition for not wanting to talk about this because they talked about it from 1919 until 1957 and did nothing about it. They did not provide a red cent to the Canadian people. As usual it was left to the Conservative government to fulfil the old promises of the former administration.


John Whitney Pickersgill: Hundreds of millions in hospital grants.


Robert Carman Coates: Now, now. The comments of hon. gentlemen opposite are somewhat like those of the Leader of the Opposition in the fog at Amherst. Hon. gentlemen opposite waver back and forth and straddle both sides of the fence. You never know where their
Alleged, Lack of Economic Growth feet are but you can always count on them being on both sides of the fence.


Mr. Hodgson:: The late C. D. Howe said, "What's a million?"


Robert Carman Coates: It took a Conservative government to provide the people of Canada with hospital care. At this time this government is providing the people of Nova Scotia $1 million a month toward better hospital treatment.
We in Nova Scotia are very interested in education. We have a fine record in that regard. Let us look at university grants in which we are all interested. Hon. gentlemen opposite also choose to ignore university grants. In 1956 Nova Scotia universities received $695,000. In 1961-62 they are to receive $1,095,000 and this figure does not include the 50 cent per capita increase in the grant recently announced. Is this the type of aid hon. gentlemen opposite wish to overlook and about which we should forget? This is another example of what is being done for every Canadian from Nova Scotia to British Columbia by the present government.
Since my election in the House of Commons it has been my contention that the industrial development bank has not provided that degree of service to industries in the Atlantic provinces that should have been provided over the years. For a number of sessions I had on the order paper a bill which sought to amend the Industrial Development Bank Act to make its services more beneficial to industries in our area. As all hon. members are aware at the last session of parliament the Minister of Finance (Mr. Fleming) amended the act in a very material way which had the effect of greatly broadening the scope of the measure. The financial resources of the bank were increased from $157 million to $400 million. It has only been a short time since the amendments came into effect but the results to date are most gratifying and indicate a far greater service to industries in the Atlantic provinces than could have been possible without the amendments.
An example of the effect this is having at the present time on business in the province of Nova Scotia alone is indicated in the annual report of the bank which reveals that 49 loans were made available to business in Nova Scotia last year as compared with seven loans made in 1956, the last year during which Liberals were in office. Seven times as many loans were made available in 1961 as in 1956.
An indication of the increased scope of the services of the industrial development bank is to be seen in the 1961 report of the president where it is stated that there has been an 84 per cent increase in the number of loans
1286	HOUSE OF
Alleged Lack of Economic Growth made available under the act during 1961. This increase is far greater than in any previous year. Indeed, 23 per cent of all the loans made since 1944 were made in 1961. Ten new branches have been established since 1959 and in 1961 St. John's, Newfoundland, saw a branch established to serve that province thereby providing greater service to the Atlantic area.
An indication of the increased advantage being taken by industries and businessmen in the province of Nova Scotia can be gleaned from the report. In 1956 there were seven loans approved for a total amount of $393,000. In 1961 there were 49 loans approved, seven times as many as in 1956, for a total of $2,130,000. The increase in the number of loans is reflected in the increase in dollar volume of the loans.
This has been the story right across Canada with 1956 having seen 349 loans approved as compared with 1,364 in 1961, and almost double the amount made available to businessmen of this country between the period 1956 and 1961. As I pointed out, these amendments were not in effect for the full period of the fiscal year 1961. I look forward with confidence to the 1962 report of this bank as even greater evidence of the assistance that is now available to business as a result of the amendments and increased financial resources.
My hon. friend asked me about Springhill. I think it is only fair to point out what has been done in the rest of Cumberland county as an example of what is happening in every constituency in Nova Scotia.
Hon. gentlemen opposite speak about the economy not moving forward fast enough. I do not know how fast they wanted it to move but I do know that they had better start moving a little faster with respect to looking at the facts if they want to be around to see how fast the economy will move in the next four years.
There has never been a time in my memory when things have been as progressive and employment as high in Amherst as at this time. Every major industry in the town is expanding operations. Only today I received a letter from one of the large industries there asking me to see if I could obtain harbour and wharf improvements in a specific area as they are about to enter the export market no doubt due to the splendid efforts of the present Minister of Trade and Commerce (Mr. Hees) in the attitude he has taken toward uplifting our export trade.


Some hon. Members:: Hear, hear.


An hon. Member:: The minister is applauding himself.


George Harris Hees: I did not hear the hon. member's statement. I merely knew it was a wise comment and applauded on that basis.


John Whitney Pickersgill: This is not the first time the minister has applauded himself.


George Harris Hees: I am much too embarrassed and overwhelmed with shyness to applaud.


Robert Carman Coates: Robb Engineering, the oldest major industry in Amherst, has been carrying out a constant expansion and remodelling of its facilities. At Pugwash a $2 million rock salt refinery operation will be added to the $3 million plant already in existence in that community. Last year a step forward was taken by this company in exporting its products to the United States for the first time.
One can go to Oxford and see the establishment there of a new factory by Industrial Estates Limited and their ability to secure federal contracts for the first time of a magnitude that was not ever possible previously. One can go to Parrsboro and see the ships loading pulp and lumber, in January, something which I do not believe the residents have seen for years and years. What is the reason for this activity? The reason is that the Department of Public Works has provided them with the most up to date facilities. One can go to the little village of Port Greville and see the shipbuilding industry throbbing, growing and wishing there was more room so that they could build more ships as a result of the forward looking program put forward by the Minister of Transport (Mr. Balcer) with his new subsidies.
This is the type of downcast, depressed economy that our friends opposite like to talk about. As I said before, Mr. Speaker, they are living in a fools' paradise out of which they had better come very fast. Otherwise, instead of worrying about who is going to be their next leader, they will all be sitting on the outside looking in at whomever the remainder of them, if there are any, try to choose for a leader.


Mr. W. H. McMillan (Welland):: Mr. Speaker, I was greatly surprised to hear the Minister of Trade and Commerce today say that the former government gave business and industry no co-operation. He said they were receiving a great deal of co-operation now. By implication he meant that they received no co-operation from the late Right Hon. C. D. Howe. This is the most ridiculous statement I have heard since I have come to the House of Commons. I will say that Mr. C. D. Howe co-operated very well indeed as minister. He contributed a great deal to the development of this country. If my memory serves me rightly the Prime Minister paid

his respects to him and said so at the time of Mr. Howe's death. Hence the Minister of Trade and Commerce is at variance with his own leader.


John Whitney Pickersgill: It is not the first time.


William Hector McMillan: As for myself, I think the minister has become so inflated with his own ego that he thinks he surpasses Mr. Howe in his value to Canada.


George Harris Hees: I was not comparing myself with Mr. Howe. I was comparing the department today with the department then.


John Whitney Pickersgill: Just puffed up by your own hot air.


William Hector McMillan: I do not mind it one bit if the minister wishes to build himself up. However, I do not think he should do so at the expense of the good name of Mr. Howe.


George Harris Hees: Oh, no. We do not do that over here.


William Hector McMillan: The Minister of Trade and Commerce painted a very rosy picture. He gave some figures. He gave percentage figures. I heard one Conservative member making reference to those on this side of the chamber and saying that we always referred to percentages and not to actual figures, As a matter of fact, I could give him some actual figures in connection with trade and commerce. I could give him the outright figure of the increase in business failures in Canada and the increase of the deficit of the C.N.R. under this government. They are not percentage figures. After listening to the minister I wondered why there was not a labour shortage in Canada at the present time-


An hon. Member:: The same old blue ruin.


William Hector McMillan: -why at this time anyone was unemployed and why the unemployment insurance fund is still going down. The minister referred to the wonderful team work in his party. I will refer to some of that wonderful team work and where it has landed Canada at this time.
I think nobody will deny that there has been a slowdown in our economy from 1957 onward. The average annual increase in the gross national product from 1950 to 1956 was 6 per cent and since that time it has gone ahead only at the rate of 1J per cent.


David Vaughan Pugh: That is not correct.


Lester Bowles Pearson: Then the bureau of statistics is wrong.


William Hector McMillan: It is correct. In 1956, compared with 1950, the volume of national production on a per capita basis increased by
Alleged Lack of Economic Growth 22 per cent between those two years and from 1956 to 1961, it has gone down by 4 per cent.


David Vaughan Pugh: That is not correct.


John Whitney Pickersgill: These are dominion bureau of statistics figures published by the Minister of Trade and Commerce.


George Harris Hees: How ridiculous can you get?


Mr. Speaker:: Order. The hon. member who started this last series of interruptions will very shortly have an opportunity to give his own version of the facts. In the meantime, I think it is only fair that the hon. member who has the floor should have it to himself.


William Hector McMillan: The total capital expenditures in Canada in constant dollars increased by 62 per cent from 1950 to 1957, and there has been a decrease in 1961 from 1957. What is more important still is the fact that business capital expenditures are down by about 25 per cent. It is true that we have an increase in building, housing and some other sectors of our economy.


George Harris Hees: Of course, that does not count.


William Hector McMillan: However, in the business sector, the figure is down by 25 per cent. Prior to 1956, unemployment was slightly under 3 per cent. Since 1957 it has practically always exceeded 6 per cent. We know that in February, 1961, we had the highest unemployment since the war when it reached the figure of 719,000. Unemployment is not down so much now when you take into consideration the increased number of people who are on direct relief. In some of the papers I saw it referred to as a 14 per cent increase and in some others as 17 per cent. Then you must take into consideration the number of unemployed in the vocational training program and in the civil defence forces.


Lester Bowles Pearson: And the number going to the United States.


An hon. Member:: Name the paper.


William Hector McMillan: I think our trade is an important matter because trade accounts for about 25 per cent of our labour force. I am glad to note that we have had an increase in trade during this last year. However, 50 per cent of that trade in the first nine months of the year was due to an increase in shipments to communist countries. This is a trade diversion on which we cannot always count. I am also glad to note that we are shipping some commodities to Cuba. I have here U.S. News and World Report for February 26, 1962. In it there is an article which
1288	HOUSE OF
Alleged Lack of Economic Growth is headed, "How Canada Helps Keep Castro Going" and which reads in part as follows:
At a time when the U.S. is appealing for support in a campaign to isolate Castro, Canada's exports to Red Cuba have reached record levels.
Food, machinery, aircraft engines and other goods from Canada-even explosives-are being used by Cuba's communist masters to stave off any internal crisis that might spark an uprising.
Chemicals, chemical specialities and explosives reached an export value of $600,000 while aircraft engines and parts totalled $169,000. Then the article goes on to say:
Criticism by U.S. officials of Canada's trade with Cuba has drawn sharp replies from Canadian spokesmen. Foreign secretary Howard Green called such criticism "improper". Nevertheless, there are signs that Canadian public opinion may force a change.
As one member of the House of Commons I would appeal to the government to stop shipping explosives and aircraft engines and parts to Cuba.


Mr. Speaker:: Order. I am a Httle puzzled to determine how the present argument of the hon. member relates to the amendment and subamendment before the house.


William Hector McMillan: Mr. Speaker, the new trade blocs present us with a challenge and I think we should investigate those blocs. I certainly do not think that at Accra the ministers investigated the European common market properly. For instance, the Minister of Finance said something to the effect that Britain would be on a slippery slope if she joined the common market. I have not got the exact words of the Minister of Trade and Commerce but they were to the effect that Britain would have to choose between the commonwealth and the European common market.
A Senate committee has stated that in the next five years or in the early 60's Canada will need to provide about one million jobs, and I do not think we can do that if our economy is standing still. If our economy had progressed at the same rate as it did in previous years under the former administration there would have been an increase in the gross national product of $14 billion in the last four and a half years. In goods and services this amounts to about $3,000 for the head of every family in Canada.
I have heard some reference to elections past and future, and the Conservative party won the last election largely on a vision. I was glad to hear one hon. member say tonight that his party would go to the country on its record. I do not propose to put on Hansard the platform of our party. The hon. member for Brome-Missisquoi (Mr. Grafftey) suggested tonight that we should have a reasonable and sensible alternative. I would say to him that


it is important to our economy above everything else that we should have a good stable and solid government, that we should have a sound fiscal, monetary and foreign exchange policy that will restore confidence among our people and among people of other nations.
The policy we have now discourages investment in our country. It discourages the building of new plants where people might be employed. I think this is very important to our economy. The policy that we have now produces a flight from the Canadian dollar. I predicted in the House of Commons last August and also in the previous year that unless there was some change in our fiscal and monetary policy we would have a flight from the Canadian dollar. I do not think that anybody will disagree with the fact that there is a considerable flight from the Canadian dollar at the present time. We only have to refer to Barron's Weekly, a financial magazine, which had this to say in this week's issue:
For more than four years then, Canada's Conservatives, adopting one misguided economic and fiscal policy after another, have been playing with fire.
Further on it says:
Canada's financial crisis worsens under this kind of irresponsibility.
I know there have been some articles in the press disagreeing with what Barron's has said but I can quote worse comments. Their comment is mild compared with those which appeared in the Monetary Times of London, in the New York Times some time last year and also in the London Spectator. Certainly in some of our own newspapers we have seen far worse comments than that which appeared recently in Barron's Weekly.
How can there be confidence, Mr. Speaker; how can there be new investment in the face of the present type of monetary and fiscal policy? Without new investment how can we expect to have any substantial upswing in our economy and in our gross national product? Without new investment how can we expect any great increase in employment?
In my opinion monetary policy is vital to our economy and to the welfare of Canadians generally. I know that at the time the minister announced a planned devaluation of the dollar I said that after this had been accomplished it would not be hard to maintain because of the way he set out to bring it about. In the budget debate I said at that time that it would create a lack of confidence and that this would be a strong psychological factor in depressing our dollar. What happened? We spent millions of dollars to depress the dollar and now we are spending millions of dollars to support it.

I will enumerate eight events, any one of which might have a considerable effect on our economy because of their effect through investment channels.
Number 1. In last May and June we had the Coyne affair which resulted in a bad press both at home and abroad. I think this was a psychological depressant on our economy and on our dollar, the results of which did not develop immediately.
Number 2. Then in June we had the long delayed budget and at that time the Minister of Finance made a complete flip-flop. He turned around and tried to depress the value of our dollar. If we turn to page 2673 of Hansard for March 31, 1960, we see that the minister said:
An attempt by the government artificially to lower the external price of the Canadian dollar would involve borrowing or raising by taxes very large sums of money with which to buy up foreign exchange.
Then, a little farther along he said:
In other words, we would be embarking upon a gigantic financial speculation with no assurance of success.
What success have we had? I know that already we are putting up $7 million a day to support that dollar.


William Joseph Browne: How do you
know that?


William Hector McMillan: I can read, and that is contained in the report of the Bank of Canada.
Number 3. In December, we had the reported firing of the Minister of Finance. I do not care whether or not there is any substance in the story; that is not the point. The point is that the Prime Minister allowed these stories to continue for two or three weeks without denying them. I think, myself, that created a lot of misgiving in the country. It is very significant that immediately after that we had to support our dollar, while immediately before that we were trying to suppress our dollar. We have spent $200 million since that time, according to the last report, supporting the Canadian dollar and trying to keep it from going lower. I think that is very significant.
Up to that time, it had been reported in the house we were spending money to keep the dollar down, and after that we were spending money to support the dollar. This split in the cabinet, I think, was very disturbing to the country. I am not trying to say that the Minister of Finance was to be fired; that is not the point. The point is that the story got out to the people of Canada, to the people abroad. It may have seemed funny on the surface, but it was not funny to the taxpayer
Alleged Lack of Economic Growth because, according to the last report, he has been paying up to $200 million to support that dollar.
In so far as the exchange rate is concerned, I may say that I saw a very funny cartoon. It showed the Minister of Finance holding a bear by the tail. He was in a very precarious position. I suggest the artist might more properly have shown the minister throwing the taxpayers to the wolves.
Number 4. In November I was in Ottawa and I saw a story in the Ottawa Journal to the effect that experts from the international monetary fund were coming to Ottawa to try to assess our troubles in connection with the exchange fund.
Number 5. Last year, particularly since last June, we have been debasing our currency at the rate of between $5 million and $6 million a day, that is up until early January. I do not know what has happened since then. We only have to go back a short time to ascertain what the Minister of Finance had to say about inflation. This is inflation because, in one year, we have increased the money supply by $1.2 billion, whereas to finance a boom year in years gone by, it has cost us between $400 million and $500 million.
The Minister of Finance had this to say on March 31 last, as reported on page 2673 of Hansard:
Let us give no quarter to such a defeatist attitude. Inflation acts like a drug on the economic system- even small doses breed a craving for more.
Then, farther along he said:
One of the most serious effects of inflation is that, like other drugs, it erodes stamina and willpower.
Are we to take it from this that the stamina and willpower of the government have been eroded?


An hon. Member:: Where is the inflation?


William Hector McMillan: Would the hon. member not say that the printing of between $5 million and $6 million a day is not inflation?


Mr. Nesbitt:: It depends on the amount of goods being produced.


William Hector McMillan: Then: Number 6. About a week or two ago practically all the members of the press, radio and television were saying that Canada would be on the carpet because of her actions with the exchange fund.
Number 7. The press also carried stories to the effect that Canada requested the meeting be in secret.
Number 8. At the Accra conference in September the comments that were made by our minister tended to create some doubt as to the future of the British commonwealth. We all had knowledge of the Coyne affair and of the

Alleged Lack of Economic Growth planned devaluation of the dollar. We also have knowledge of the inflation that is taking place. However, I cannot believe that the other items originated in the minds of the members of the press and in their minds alone as the government would like us to believe.
What does this all add up to? If you take any one of these eight items, along with our high rate of unemployment, the slow pick-up in our economy and our huge budgetary deficit, you have enough to affect the price of our dollar and to scare investors away from our country. You also have enough to scare the Canadian people from investing in different projects within this country. When you consider all these points together, it is no wonder that financial men in New York and Chicago are saying that our dollar will sell at 90 cents. The actions of the government have certainly brought about a lack of confidence at home and abroad. Confidence is one thing you cannot buy with dollars alone. This is something the Minister of Finance must get out of his head. I think you have to have stability. In years gone by our financial system was the envy of the world. Our foreign dealings were above reproach. If you read some of the press reports today, you find that is not the case. I say that the market for dollars is the same as the market for anything else. It will react more to uncertainties than it will to realities. I think our government is providing the uncertainties.
Now, the fiscal and monetary policies should be closely related in order to have a good economy in Canada. I will not go into the details of the conversion loan, but I will mention it in passing because the series of events set in motion by that conversion loan have carried us to the point where we have had to adopt our present fiscal and monetary policies a part of which has been the present policy of supporting our exchange rate. I will say also in passing that the conversion loan is the basic reason, after all, for the governor of the Bank of Canada appearing in Washington last week to defend the actions of this country in connection with the exchange rate. I can say that we gave the people a good economy, good employment, reasonable interest rates and hope for the future and I suggest that the people know the party opposite for their promises. They promised almost anything from an increase in the price of asparagus to a covered city in the north, built on stilts. I suggest that the people will know them for their works, our poor economy, high unemployment and poor hope for the future.
The Minister of Trade and Commerce has been part of that team. He likes to refer to himself as part of the team, but I suggest


that team has produced some great records which have had something to do with the poor state of our economy. For instance, dealing first with the conversion loan I would suggest that probably the whole team got in on that decision. We were told that the conversion loan was the greatest financial transaction in Canadian history. Probably there is no doubt but that it was the greatest. Another record set by this government was the 719,000 unemployed last February. Another record was our bonds being sold at the lowest price in the western world, less than Cuba's bonds in the early days of the Castro revolution.
The other night I placed on the record the great increase in failures in small businesses and small industries. We have an economy which is standing still, but if there is any slight pick up in the economy from one month to another then a Conservative member seizes upon it with glee and tells us about it in the house.


William Joseph Browne: And you
don't like it.


William Hector McMillan: Then we have the high interest rates. When this government took over the average interest on all debt was 2.98 per cent, but now the Minister of Finance never tells us where it stands.


Mr. Monteith (Perth):: He told you today.


William Hector McMillan: Not the average interest.


Jay Waldo Monteith: Yes, he did.


William Hector McMillan: He told us the average interest on some part of the debt.


Jay Waldo Monteith: He told you the average interest on all parts of the debt.


William Hector McMillan: This is the sort of thing that happens because of the monotonous overdraft of $2 million a day and as a result of the depletion of the unemployment insurance fund. That has to be added to it. It is little wonder then that foreign papers like the London Monetary Times and New York papers refer to Canada as having an economy that is in a mess.
I heard one speaker say tonight that Canada's prestige was high in all parts of the world. Well, I have been in Europe and I got the impression that our prestige was never lower.


Mr. Bell (Carleton):: Ridiculous.


Raymond Joseph Michael O'Hurley: Where did you go?


William Hector McMillan: I will tell hon. gentlemen opposite that the information I got was unsolicited. When I presented a Canadian $5 bill they would not take it at the airport in

Lisbon whereas they said they took money from practically every other country in the world. They took Italian lira, they took money from some of the African colonies, from Brazil, from France, but they would not take Canadian money.
This government has offended Britain. It has offended the United States, Uruguay and British Guiana. We heard that in this house, and I do not think there is any doubt about it. It does not matter how often hon. members opposite get up and say we are on the wrong track. They say we have nothing to offer. The one thing we always offered, and still do, is stable and sound government, and that is something Canada has not got today. That is something we could always offer.


David Vaughan Pugh: This constant reiteration of doleful facts, of doom and gloom from the Liberal party, gives me a pain in the neck. I do not want to embark on that subject right now as I would like to start tomorrow, if I may call it ten o'clock.


John Whitney Pickersgill: I don't think so.
Business of the House


David Vaughan Pugh: I shall deal first with the amendment proposed by the hon. member for Niagara Falls. We heard from her tonight that the gross national product has gone up 1.5 per cent; from the last speaker, the hon. member for Welland, we heard it has gone down 4 per cent. It is probably written on the record that the Leader of the Opposition turned around and said "That is correct, look it up in the dominion bureau of statistics." The hon. member for Bonavista-Twillingate turned around and nodded his head saying "Yeah, man, that is right." All I have to say to all hon. members is that all they have to do is look up the record because the dominion bureau of statistics shows otherwise.
May I call it ten o'clock?



BUSINESS OF THE HOUSE

Gordon Minto Churchill: Mr. Speaker, this debate will continue tomorrow.


[Stage Direction]
At ten o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Tuesday, February 27, 1962