1962-03-28

Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, naturally I join with all hon. members in welcoming the Minister of Agriculture back to the house after his illness. May I add my own deep appreciation of the reception that has been given by hon. members opposite on this occasion, which is so revealing of the general attitude of parliament.


Hon. L. B. Pearson (Leader of the Opposition):: Mr. Speaker, we on this side join very warmly and wholeheartedly in the welcome that has been extended to the Minister of Agriculture on his return to the house, and we welcome especially his return to health. We do not always agree with the minister, but we on this side are glad to pay tribute to his invariable personal courtesy and kindness to all members, including members of the opposition.


Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, I wish to join with the Prime Minister and the Leader of the Opposition in expressing the delight of this group at the return to the house of the Minister of Agriculture whose illness, I am sure, was occasioned by his over attention to work and, shall I say, excessive industry.



PRESENCE IN GALLERY OF MEXICAN MINISTER

John George Diefenbaker: My reason for rising, Mr. Speaker, is to draw your attention to the presence in the gallery of the Honourable Walter C. Buchanan, secretary of communications and transport in the government of Mexico. He is a most distinguished representative of a country with which for long we have had close and friendly relations. During the past few days he has visited various Canadian industrial plants and research establishments in this city, in Toronto and in Winnipeg. As the member of the Mexican government responsible for communications and transport he is particularly interested in Canadian scientific experiments in the ionosphere, in Canadian aircraft production and in telecommunications.
26207-1-liii
I know that I express the views of hon. members in all parts of the house when I say that we warmly welcome him for what he has done on behalf of good government within his own country, and for his attitude in international affairs. I should like him to convey to the president of Mexico, Mr. Lopez Mateos, and to the government and the people of his great country our warmest good wishes.


Lester Bowles Pearson: Mr. Speaker, on behalf of those on this side of the house I should like to share in and support the warm welcome which the Prime Minister has just extended to the minister of communications and transport from Mexico, and to echo the friendly sentiments the Prime Minister has expressed about the gentleman in question and the country he represents here today, a country whose hospitality some of us have had the privilege to enjoy.


Herbert Wilfred Herridge: Mr. Speaker, the members of this group join wholeheartedly with the Prime Minister and the Leader of the Opposition in extending a welcome to our distinguished visitor from Mexico, the minister of communications and transport. We trust that his visit to Canada will be fruitful on his part and that as a result of his visit our government will learn something about the percentage of expenditure by the federal government of Mexico on highways in that country in connection with the states and provinces.



MISCELLANEOUS PRIVATE BILLS


[Stage Direction]
Mr. R. J. McCleave (Halifax) presented the first and second reports of the standing committee on miscellaneous private bills, and moved that the first report be concurred in.
Motion agreed to.


Hon. Alvin Hamilton (Minister of Agriculture):: Mr. Speaker, at the outset of what I wish to say I should like to thank hon. members and yourself for the very kind welcome back to the house after my absence.
2248	HOUSE OF
Additional Wheat Sale to China If I may be permitted to do so, I should also like to thank all hon. members and people generally across Canada who sent me their good wishes during the last two months.
I should like to say a special word of thanks to my colleagues the Prime Minister, the Minister of National Defence, the Minister of Veterans Affairs and the Minister of Fisheries, as well as my two parliamentary secretaries, for carrying during my absence some of the burden that normally belongs to me. I hope they will keep on helping me for a little while yet.
I have pleasure, Mr. Speaker, in announcing today the completion of an additional sale of one million long tons of wheat to China. Allowing for a tolerance of 5 per cent, this will amount to slightly in excess of 39 million bushels. The estimated value of this contract is approximately $75 million. This sale is part of a long term agreement which I announced in the house last spring. This latest sale is the sixth contract completed under the long term agreement which called for the purchase of up to 186.7 million bushels of wheat and 46.7 million bushels of barley. In summary, therefore, six individual contracts have been concluded to date under the long term agreement, totalling 108 million bushels of wheat and 26 million bushels of barley. In addition to these quantities purchased under the long term agreement, China purchased on a cash basis last spring 31.7 million bushels of wheat and 12.7 million bushels of barley.
Payment terms for the contract on the latest purchase of wheat are identical to previous contracts, namely 25 per cent cash and 75 per cent on 273 days' credit with interest. This transaction was completed within the $100 million credit guarantee made by the government to the wheat board to facilitate the sale of grain to China.
The bulk of the wheat will be shipped from west coast ports from June through December. This will assure a steady volume of exports from Vancouver for the balance of the year. A smaller volume of approximately 5.6 million bushels will be shipped from Atlantic and St. Lawrence ports in April and May respectively.


Lester Bowles Pearson: Mr. Speaker, we on this side welcome the additional sale that the minister has mentioned of grain to China under the original contract, the details of which we are still anxious to secure.


Mr. Arnold Peters (Timiskaming):: We also welcome this new sale to China and appreciate the fact that it could be guaranteed under


the original $100 million guarantee; and unlike some sales in the past we do not consider this to be peanuts but to be a very good grain sale at this time.



QUESTIONS

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

Mr. Badanai: 1.	How many vice-presidents, assistant vicepresidents, and assistants to the assistant vicepresidents serve on the Canadian National Railways?
2.	How many automatic yards has the C.N.R. constructed, and what is the cost of each?
3.	How much has centralized traffic control cost to date, and how much more is to be spent?
4.	What is the rental cost to the C.N.R. each month for I.B.M. machines, and how much royalty is paid for each card used in these machines?


Mr. Martini:: Mr. Speaker, the management of Canadian National Railways advised as follows:
1.	(a) Vice-presidents-headquarters 11, regional 6.
(b)	Assistant vice-presidents-3.
(c)	Assistants to assistant vice-presidents -nil.
2.	Two in operation; Moncton, $15.6 million; Montreal, $32.2 million.
Two under construction: Toronto, estimated cost $32 million; Winnipeg, estimated cost $23 million.
3.	$14.6 million to end of 1961.
$6.8 million to equip unsignalled single track portions of principal traffic routes.
4.	Not a fixed level each month. Rentals vary depending on the number of hours of usage of certain machines beyond normal business hours also on the number and type of units used across the system. There is no royalty paid for cards used in I.B.M. machines.


SMALL POST OFFICE CONSTRUCTION
Mr. Racine: How many small post offices has the Department of Public Works built in each province during the last fiscal year; and what are, for each such post office, the operating revenue or deficit and the population served?
Answer by: Mr. Hamilton (Notre Dame de
Grace):
See attached statement showing (a) Province; (b) Location; (c) Postage revenue;
(d)	Households served (population details not known).

Province and Location
Nova Scotia
Lawrencetown	
River Hebert	
Reserve Mines	
New Brunswick
Centreville	
Blacks Harbour	
Quebec district
Desbiens	
Langevin	
Matapedia	
Pont Rouge	
St. Jean de Dieu	
St-Prosper-de-Dorchester .
St. Raphael	
Abbotsford	
Frelighsburg	
St. Donat de Montcalm ..
St. Sauveur des Monts

Valcourt	
Val David	
Weedon	
Parent	
Quyon	
Ontario
Pakenham	
Portland	
Azilda	
Caledon East	
Drayton	
Dublin	
Fort Erie P. Stn. B	
Gogama	
Delaware	
Drumbo	
Plattsville	
Longlac	
Manitoba
Eriksdale	
Ethelbert	
McCreary	
Plum Coulee	
Riverton	
St. Claude	
Wawanesa	
Winnipeg Beach	
Saskatchewan
Blaine Lake	
Borden	
Choiceland	
Churchbridge	
Delisle	
Hodgeville	
Jansen	
Kyle	
Mossbank	
Norquay	
Radisson	
Southey	
Theodore	
Alberta
Barons	
Breton	
Donalda	
Elk Point	
Hines Creek	
On oway	
Ryley	
British Columbia
Harrison Hot Springs 

Matsqui	
Fruitvale	
Postage	House-
Revenue	holds
1960-61	Served
$ 6,694.37	399
4,762.88	398
4,345.48	414
5,042.47	435
12,605.48	438
5,623.62	396
4,124.39	266
4,821.00	294
8,510.36	874
5,480.39	381
6,159.03	623
5,045.52	587
4,216.09	401
4,769.53	234
7,915.30	377
9,768.98	611
7,306.22	413
4,335.27	305
6,573.02	417
6,959.73	290
3,360.47	320
3,228.70	348
3,747.50	235
4,659.80	557
4,349.86	379
7,113.99	343
3,816.35	295
28,819.04	145
3,808.26	199
12,779.05	207
4,031.82	378
8,563.24	217
8,512.20	311
3,758.64	228
4,241.17	429
5,639.35	337
3,535.67	384
5,459.97	283
3,497.64	324
12,688.57	256
4,823.57	277
5,538.61	485
3,004.72	277
3,746.96	351
3,698.10	292
4,112.16	210
3,888.93	262
2,283.69	172
5,657.38	362
4,876.04	291
6,783.58	389
3,864.92	292
4,706.22	399
3,990.02	327
4,895.33	265
3,374.38	331
3,552.56	317
7,016.98	313
6,698.74	381
7,161.07	438
5,679.46	338
7,019.36	369
3,754.57	462
6,790.84	533
Questions


* JOB PLACEMENT FIGURES
Mr. Fisher: 1.	How often does the Department of Labour or the unemployment insurance commission issue figures on job placements?
2.	What were the last two totals given in such releases?
3.	Did these two totals include only people placed in new jobs (or jobs new to them), or did they include people who were called back to work after lay-offs, the call-back being handled through the national employment service; and, if the latter is the case, how much of the given totals in each case was for those who were placed in jobs new to them by the national employment service?


Mr. Thrasher:: 1.	Figures on placements are normally released monthly in the Labour Gazette and in occasional press releases.
2.	The February, 1962 edition of the Labour Gazette showed December, 1961 placements at 96,503. The December edition of the Labour Gazette showed a cumulative total for the first 10 months of 1961 at 924,844. A news release issued by the unemployment insurance commission on January 4 showed preliminary total placements for 1961 at 1,119,855.
3.	Placement totals included people placed in new jobs, or jobs new to them, as well as people who were called back to work through the national employment service. Precise data are not available as to the proportion of total placements which relates to persons placed other than by reason of being called back. It is estimated, however, that persons placed in new jobs, or jobs new to them, amount to about 90 per cent of the total placements.


* WATER SHIPPING IMPROVEMENTS, MIRAMICHI RIVER
Mr. McWilliam: Has the Minister of Public Works received a request from the Miramichi port improvement association for an interview in connection with a request for water shipping improvements on the Miramichi river; and, if so, has a time and place been set for the interview?


Mr. MacLean (Queens) (Acting Minister of Public Works):: The answer to the first part of the question is yes. The department has suggested Aprill 4 or 5, in Ottawa.


IMPORTS OF COMMODITIES COVERED BY AGRICULTURAL STABILIZATION BOARD
Mr. Pitman: What was the quantity and value of all commodities, covered by the agricultural stabilization board, imported during the fiscal year 1960-61?
Answer by: Mr. Morris:
I.	Available statistics on imports of commodities covered by the agricultural stabilization board, fiscal year 1960-61:
2250	HOUSE OF COMMONS
Questions
Class No.	Description	Unit of Qty	Quantity	Value125	Potatoes n.o.p	..Lb.	284,197,877	$ 8,253,145162	Beans, soya	15,024,474	31,888,920168	Oats 	1,893	7,405174	Wheat	2,985	7,5382260	Turkeys, dead or alive n.o.p. ,	..Lb.	5,270,106	2,007,7732281	Milk and cream, fresh 	,. Gal.	113,549	298,5412282	Butter	224	1352284	Cheese 	13,603,422	6,803,9962325	Eggs in the shell	1,190,450	2,222,3892337	Honey 	2,219,014	347,514-3263	Wool, raw 	, .Lb.	18,177,736	11,841,307
II. Separate statistics are not available on imports of barley, sunflower seed, sugar beets, hogs, lambs or steers.


* LEVER BROTHERS
Mr. Pitman: 1.	Has the federal government been contacted by Lever Brothers (Canada) in regard to the use of copies of the Canadian Bill of Bights in connection with the promotion of Stripe tooth paste?
2.	Has the federal government made available to Lever Brothers (Canada) any substantial number of copies of the Canadian Bill of Rights for this purpose; and, if so, how many copies?
3.	What was the total cost of production of these copies?


Mr. Balcer:: The answer to part 1 is no. The answer to part 2 is no. The answer to part 3 is "not applicable".


* UNEMPLOYMENT INSURANCE CLAIMANTS
Mr. Robichaud: What was the total number of active claimants for unemployment insurance benefits as of February 28, 1962, 1961, and 1960 respectively?


Richard Devere Thrasher: The number of active claimants as of February 29, 1960, was 814,241; as of February 28, 1961, 872,842; and as of February 28, 1962, this figure is not yet available.
^ELECTRICAL GOODS


DUMPING DUTY EVASION BY SUBSIDIARY COMPANIES
Mr. Benidickson: 1.	Is there information before the Department of National Revenue that subsidiaries of Canadian electrical goods manufacturing and distributing companies, incorporated outside Canada in low tax-rate jurisdictions, purchased electrical goods in the United States at prices below the fair market value as prescribed by the valuation provisions of the Customs Act in effect since September 6, 1958, and transferred their rights in the goods so purchased to the parent Canadian companies without the application of dumping duty contemplated?
2.	If so, how many Canadian companies are known to the Department of National Revenue to have used subsidiary companies for this purpose since September 6, 1958?
3.	Does the government contemplate any action with respect to this situation?


Mr. Nowlan:: 1. The Department of National Revenue has information to the effect that some Canadian manufacturing companies, including a few which are engaged in the manufacture and distribution of electrical products, have been importing goods produced in other countries through intermediate companies incorporated outside of the jurisdiction of Canada. Wherever this situation can be construed legally as a relationship of principal and agent, the Department of National Revenue has refused to recognize transactions between them to be at arms' length, and appropriate dumping duty has been applied.
2 and 3. Answered by above.


WIDENING OF ENTRANCE TO WOOD ISLAND HARBOUR, P.E.I.
Mr. Pickersgill: 1.	What was the amount of the contract let to eastern enterprises to widen the entrance of Wood Island harbour, P.E.I.?
2.	Will the work be completed at the contract price without extras?
3.	How many men are employed on this project at the present time?
4.	How many inspectors are engaged in this project?
5.	Is it still contemplated that the work will be completed by June 30 or is a further extension in contemplation?
Answer by: Mr. MacLean (Queens) (Acting
Minisier of Public Works):
1.	$479,048.
2.	No extra work on this contract is anticipated.
3.	15.
4.	Three; one on dredging and blasting in the entrance channel, one on wharf construction, and one on blasting and drilling associated with the wharf construction.
5.	It is expected that the construction portion will be completed by June 30. Present indications are that the demolition and dredging portion of the contract will not be completed before September, 1962.


NEW POST OFFICE BUILDINGS, REVENUE RANGE $15,000-$20,000
Mr. Benidickson: 1.	At what localities has the government constructed or provided estimates for the construction of new public buildings to accommodate post offices where annual postal revenues prior thereto had been within the range $15,000 to $20,000 for the five fiscal years 1958-59 to 1962-63 inclusive?
2.	What was the actual or anticipated capital cost for each such building (a) for land (b) for building and equipment?
Answer by: Mr. MacLean (Queens) (Acting
Minister of Public	Works):		
1 and 2 listed below: Location		Land	Building and Equipment
Actual			
Altona, Man. ..	$ 4,000	$48,422.21Barrhead, Alta.	7,500	40,122.10Caledonia, Ont.	11,000	40,697.50Parksville, B.C.	4,040	25,819.00Anticipated	Minden, Ont. ...	11,700	30,000.00Red Lake, Ont.	3,500	30,000.00Stayner, Ont. ..	12,300	40,000.00Raymond, Alta.	5,000	40,000.00Aldergrove, B.C.	8,300	35,000.00Gibsons, B.C. ...	6,500	35,000.00* FEASIBILITY SURVEY,	CHIGNECTO CANAL	
Question No. 339-Mr. McWilliam:
Is it the intention of the government to include, in a further supplementary estimate for the year 1962-63, the sum of $2,300,000 to cover costs of a full-scale survey of the engineering feasibility of tidal power and canal construction of the proposed Chignecto canal?


John Douglas Campbell MacLean: The federal government has not yet had an opportunity to review the preliminary engineering report on tidal power prepared by three consulting firms for the government of New Brunswick, nor have we received New Brunswick's proposals concerning it. Until such a review has been made, the government is not in a position to make a decision regarding a full scale survey on the engineering feasibility.


QUESTION PASSED AS ORDER FOR RETURN
Mr. Pitman: What has been the total expenditure of the Department of Transport in the federal electoral district of Peterborough in each of the past 10 years?
Motions for Papers MOTIONS FOR PAPERS


METHOD OF AMENDING CONSTITUTION
[Stage Direction]
Motion No. 2-Mr. Pickersgill (for Mr. Chevrier):
That an humble address be presented to His Excellency praying that he will cause to be laid before this house a copy of all correspondence exchanged between the Minister of Justice and the attorneys general or other provincial ministers since July 1, 1960, regarding the method of amending the constitution of Canada.
Mr. Fulton:: Mr. Speaker, we are prepared to accept this motion subject to one or two reservations or observations. First, in anticipation of the opening of this session I wrote to the provincial attorneys general on January 9 asking if they had any objection to the production of this correspondence. I have received no objection, with the exception of Quebec, to which I will refer in a moment, and accordingly propose to table the correspondence for the period up to January 9 when I asked for the views of the provinces.
With respect to the province of Quebec, there is unfortunately an objection from that province to the production of one of my letters to Mr. Gerin Lajoie. I am hopeful that this controversy can be resolved in the very near future and I will then table the correspondence with the province of Quebec, up to a date a little later than January 9. Because of the discussions we have been having, it will be necessary to table the later correspondence in order to make the picture clear. I hope to table the correspondence with all the other provinces very shortly, and shortly thereafter the correspondence with the province of Quebec.


Mr. Pickersgill:: I take it from what the minister has said that there is no correspondence with the other provinces between January 9 and 18?


Edmund Davie Fulton: There is some, but it is really in the nature of continuing negotiations, and I do not feel I should produce correspondence beyond the date for which I asked for consent.


John Whitney Pickersgill: That is agreeable.


Mr. Speaker:: Subject to the reservation expressed by the minister, is it the pleasure of the house to adopt the motion?


[Stage Direction]
Motion agreed to.

[Stage Direction]
Motion No. 35-Mr. Mcllrailh:
That an order of the house do issue for a copy of the report declaring the land (being part of lot 19, Junction Gore, Gloucester township) surplus as referred to in order for return, sessional paper 194. tabled on the 14th of February, 1962.
[Stage Direction]
Motions for Papers
Mr. O'Hurley:: Mr. Speaker, with the agreement of the hon. member for Ottawa West (Mr. Mcllraith) this motion stands.
Motion stands.


AMOS-MATTAGAMI HIGHWAY, QUEBEC
[Stage Direction]
Motion No. 36-Mr. Paul (for Mr. Martel):
That an humble address be presented to His Excellency praying that he will cause to be laid before this house copies of all agreements, contracts, and other documents relating to the construction, under the roads to resources program, of the Amos-Mattagami highway including a copy of the contract entered into by the province of Quebec or the department concerned and the general contractor who carried out these works; a list of names and addresses of persons who worked for the general contractor and the provincial department concerned on the construction of the said highway; a list of subcontracts given out by the general contractor in connection with these works and the names of individuals or companies having rented equipment, by the hour or on a contract basis, for the carrying out of the general contract or the subcontracts in question; a list of suppliers, and the names of those who recommended them to the general contractor or the subcontractors.
Mr. Dinsdale:: Mr. Speaker, this motion is acceptable subject to the concurrence of the province-


Mr. Mcllraith:: It has not been moved yet; it is not before the house.


Mr. Speaker:: Has Mr. Paul leave to move this motion for Mr. Martel?


Some hon. Members:: Agreed.


Mr. Speaker:: Mr. Paul, for Mr. Martel, seconded by Mr. Pigeon, moves:
That an humble address-


George James McIlraith: Before you put this motion, Mr. Speaker, I should like to raise a point of order and draw your attention to the fact that the first part of the motion asks for certain copies of agreements, contracts and other documents relating to the construction, under the roads to resources program, of the Amos-Mattagami highway. It then goes on to say, and these are the important words: -including a copy of the contract entered into by the province of Quebec or the department concerned and the general contractor who carried out these works; a list of names and addresses of persons who worked for the general contractor and the provincial department concerned on the construction of the said highway;-
And so on. It will be noted that this part of the motion relates to a matter that is the responsibility of the provincial government. I must say I was somewhat amazed to observe that such a notice of motion appeared on the order paper, since it relates to the production of provincial government documents and not to the production of federal government documents. I wish to draw the matter to

Your Honour's attention because I think it will be granted that within its own field of jurisdiction the province is sovereign.


Edmund Davie Fulton: Mr. Speaker, I think before we deal with that case we would have to know what the situation is. It is my understanding that the situation is that when a joint roads to resources project is agreed to, one of the terms is that the contracts will be produced to the federal government with the relevant information asked for here. As I say, that is only my understanding of the situation. It was, I think, with that in mind that these words were included in the motion.


Mr. Speaker:: In the absence of the mover and in view of the doubt about the matter, unless the Minister of Justice is prepared to assure the house in this respect-


Edmund Davie Fulton: No, I am not, Mr. Speaker.


Mr. Speaker:: -I think the motion might stand until the next time, and perhaps the house then could be advised whether there is a right on the part of the federal government to produce these documents. There may be a contractual right, but it is not apparent on the face.
Motion stands.


NEW FEDERAL BUILDING, FORT WILLIAM, ONT.
[Stage Direction]
Motion No. 37-Mr. Badanai:
That an order of the house do issue for a copy of all correspondence since January 1, 1961, between the Minister of Public Works and other persons and associations outside the government, regarding the construction of a new building to house the unemployment insurance commission and a new post office in the city of Fort William.
Motion agreed to.

[Stage Direction]
Motion No. 38-Mr. Pickersgill (for Mr. Benidickson):
That an humble address be presented to His Excellency praying that he will cause to be laid before this house a copy of rulings, directives, regulations, and prescriptions of the Minister of National Revenue, and also orders in council issued under authority of sections 39, 40, 40A, and 40B of the Customs Act (as amended by chapter 26, Statutes of Canada 1958); and a copy of ministerial orders issued since April 17,	1961; under the
provisions of section 38 of the Customs Act for the purposes of fixing duties on imports.
George Clyde Nowlan: Mr. Speaker, perhaps the hon. member would allow this to stand until I have the opportunity to discuss it with the mover; because there are some limitations, I think.


John Whitney Pickersgill: Certainly.
Motion stands.

Inquiries of the Ministry
illustration or experimental station, For the time being I shall accept the hon. thunder bay district	member's question as notice.
Motion No. 39-Mr. Badanai:
That an order of the house do issue for a copy of all correspondence since January 1, 1958, between the Minister of Agriculture and other persons and associations outside the government, regarding any operation or plans of the Department of Agriculture dealing with illustration stations or the establishment of any permanent experimental station in the Thunder Bay district (more particularly in the vicinity of Port Arthur and Fort William).


Francis Alvin George Hamilton: We have no objection, Mr. Speaker.


[Stage Direction]
Motion agreed to.


[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: Mr. Speaker, may I ask the Minister of Finance whether he has any comment to make on the legal action taken by the United States government against the Royal Bank of Canada in New York regarding a payment by that bank of certain moneys to the Castro government in Cuba?


Hon. Donald M. Fleming (Minister of Finance):: No, Mr. Speaker.



WATER RESOURCES


[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: Mr. Speaker, I wish to direct a question to the Minister of Northern Affairs and National Resources. In view of the fact that the three week conference on oil pollution in the sea held in London was informed that oil pollution has not increased substantially around the United States since 1955 but is much more serious around Canada, could the minister inform the house what additional efforts he is making to counter this unfortunate development under free enterprise, and to ensure that Canadians may regain the freedom to enjoy unpolluted waters?


Walter Gilbert Dinsdale: Mr. Speaker, as this subject comes under the responsibility of my colleague the Minister of Transport, I would suggest that the hon. member direct his question to him.


Herbert Wilfred Herridge: Mr. Speaker, is the Minister of Transport prepared to answer?


Léon Balcer: Mr. Speaker, I know that my department is exerting strong efforts in fighting pollution.



AGRICULTURE


[Stage Direction]
On the orders of the day:
Mr. G. H. Doucetl (Lanark):: Mr. Speaker, I should like to ask the Prime Minister whether he has any announcement to make with respect to the details of the dairy support program as indicated last Thursday.


John George Diefenbaker: Mr. Speaker, the hon. gentleman gave me notice of his intention to ask this question. It will be recalled that when the announcement was made last Thursday the Acting Minister of Agriculture stated that the stabilization board had been instructed to enter into discussions with producer and industry representatives with respect to the details of the new program, and that following these discussions a full announcement of the details would be made. There will be an announcement as to details and any modifications which may be agreed on following consultation with various representative groups.
There have been a number of these representations made to date with regard to this program, and when the consultations have been completed the house will be made fully aware of the details.


Hon. Paul Marlin (Essex East):: A supplementary question, Mr. Speaker. Has the Prime Minister received any request from the fluid milk producers for a meeting with the government regarding this program?


John George Diefenbaker: I received communications from various groups of milk producers, and my recollection is that they will make representations. I am not able to answer specifically the question asked by the hon. gentleman, but my recollection is that discussions will take place not only among representative groups but also particularly among the milk producers themselves.



PUBLIC WORKS DEPARTMENT


[Stage Direction]
On the orders of the day:
Mr. Maurice Bourgel (Levis):: Mr. Speaker, I should like to direct a question to the Acting Minister of Public Works. Can the minister explain the sudden lay-off at the beginning of the construction season of a considerable number of the members of the staff of the development and engineering branch of the department?

Inquiries of the Ministry


Hon. J. A. MacLean (Acting Minister of Public Works):: Mr. Speaker, I shall be glad to take this question as notice and provide an answer to the hon. gentleman.
(Translation):



IMMIGRATION


[Stage Direction]
On the orders of the day:
Mr. J. P. Deschatelets (Maisonneuve-Rose-mont):: Mr. Speaker, I should like to put a question to the Minister of Citizenship and Immigration, of which I gave her notice. Could the minister inform the house whether she received representations concerning the admission to Canada of French citizens from Algeria? If so, does the government intend to take special action in this respect?
(Text):


Hon. Ellen L. Fairclough (Minister of Citizenship and Immigration):: Mr. Speaker, I received the notice after I entered the house and have not had an opportunity to check with my department, but to the best of my knowledge no representations have been received. Certainly none had been received last week when I made some inquiries myself. However, if representations are made from any source, of course, the matter will be very carefully considered.



NORTHERN AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Pori Arthur):: Mr. Speaker, I should like to ask the Minister of Northern Affairs and National Resources a question arising out of a very recent article in Maclean's magazine which states that the department of northern affairs is pouring more than $400,000 into the reconstruction of Dawson city, not only in relation to Arizona Charlie's but also in relation to two saloons and a mortuary. I wanted to ask the minister-


Mr. Speaker:: Order. Before the hon. member proceeds may I say the question appears to me to relate directly to the estimates of the department and, in addition, to estimates which were discussed in this house within the last two or three days.


Douglas Mason Fisher: If I may speak to the point, there is nothing in the supplementary estimates coming up under which we can broach this. The indication given by the minister last week in discussing the relevant estimates was that the expenditure would be of the nature of $200,000. Because of the exciting increase in the expenditure plus the

objectives of the increase I thought it would be in order for me to direct the question to the minister.


Mr. Speaker:: I should think the hon. member would be well advised to defer a question of that kind until the estimate is offered. It is obvious the expenditure will not be made until the estimate is offered.



HOUSING


[Stage Direction]
On the orders of the day:
Mr. J. R. Garland (Nipissing):: Mr. Speaker, I have a question for the Minister of Public Works but in his absence perhaps I could direct it to the acting minister. In view of the 16.6 per cent decline in housing starts in February, 1962, as compared with February, 1961, is the government contemplating any measures to assure that housing construction will not fall below last year's level?


John Angus MacLean: Mr. Speaker, I shall be glad to take the question as notice, but I would say in passing that any changes in government policy will be announced in due course.


John Richard Garland: If I may be permitted to do so, I should like to ask a supplementary question. In view of the continuing need for better housing accommodation for low income Canadians, has the government any explanation why no loans for limited dividend projects were made by C.M.H.C. during February, and for the reduction so far this year which amounts to about 99 per cent?


Mr. Graffiey:: That is a statement, not a question.


An hon. Member:: Order paper.


John Angus MacLean: I will have this matter looked into, Mr. Speaker.



BRITISH COLUMBIA


[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: wish to address a question to the Minister of Justice. My question is related to the bill of rights and not to the bills of expense that are being questioned. With reference to my question on Monday, would the Minister of Justice now be in a position to state whether the provision in an amendment to legislation introduced by the government of British Columbia forbidding recourse to the courts is contrary to the bill of rights or ultra vires?


Edmund Davie Fulton: Mr. Speaker, I am not in a position to make any report on this matter beyond what I said on Monday. However, as I have seen in the press certain references to my answer, I think I should remind the hon. member that of course the bill of rights was carefully drawn so as to apply only to matters within federal jurisdiction.



IMMIGRATION


[Stage Direction]
On the orders of the day:
John Whitney Pickersgill: I should like to ask the Minister of Citizenship and Immigration a question. Now that two months have elapsed since the new immigration regulations came into effect, can the hon. lady say whether any considerable number of skilled workers have yet been admitted who would not have been admissible under the old regulations?


Ellen Louks Fairclough: The short answer is no, I cannot say, Mr. Speaker. However, the hon. member knows that these people do not come in 10 minutes. The regulations went into effect only on February 1.


John Whitney Pickersgill: Evidently the hon. lady did not understand my question. I said "two months", not "ten minutes".



THE BUDGET


[Stage Direction]
On the orders of the day:
Mr. Erhart Regier (Burnaby-Coquitlam):: should like to ask the Minister of Finance whether he is in a position to advise us as to the date on which he expects to bring down the budget.


Lester Bowles Pearson: He is in a position to do it, but he will not do it.


Donald Methuen Fleming: Mr. Speaker, I can assure the hon. member that the sooner we get through with the supplementary estimates, the better the essential business of the house will be expedited.


John Whitney Pickersgill: Can the minister say that the supplementary estimates are really holding up the presentation of the budget?
Inquiries of the Ministry HEALTH AND WELFARE



REQUEST FOR STATEMENT OF GOVERNMENT POLICY ON MEDICAL CARE INSURANCE

[Stage Direction]
On the orders of the day:
Paul Joseph James Martin: I should like to ask the Minister of National Health and Welfare a question. Now that the sessions of the royal commission on health services are just about completed, may we expect before the dissolution of the present parliament an announcement by the government of what it proposes to do with regard to medical care insurance?


Hon. J. W. Monteilh (Minister of National Health and Welfare):: Mr. Speaker, I think the hon. member for Essex East answered his own question by indicating that the sessions are not yet completed.


Paul Joseph James Martin: Postponement again; procrastination.
(Translation):



ALLEGED CONTRADICTION IN STATEMENTS BY GOVERNMENT SUPPORTERS

[Stage Direction]
On the orders of the day:
Mr. Azellus Denis (St. Denis):: May I ask
the Associate Minister of National Defence a question? As reported in the press day before yesterday, he is alleged to have said during a meeting in Laval that the Liberals had a socialist program while the member for Laval, who also attended the meeting, is reported to have said that the same program had been implemented by the Conservative party.
(Text):


Mr. Speaker:: I think the hon. member might seek an answer to that question after dissolution.
(Translation):


Azellus Denis: I simply wanted to know which of the two was right, the minister or the member for Laval, when speaking on the same platform about the same question.


Hon. Pierre Sevigny (Associate Minister of National Defence):: Mr. Speaker, I think both were right. It is quite true that the Conservative government has achieved several of the things the Liberals had included in the platform they announced at their January 1961 political convention.
As to comparing our hon. friends to the socialist party, they are themselves the victims of their actions. As long as they behave like socialists, they will be considered as such.

Supply-Agriculture
(Text):

The house in committee ol supply, Mr. Martineau in the chair.



DEPARTMENT OF AGRICULTURE

[Stage Direction]
Administration branch-
675. Departmental administration-further amount required, $77,500.
(Translation):
Mr. Boulanger:: Mr. Chairman, has the minister a statement to make? Since he has not, I would like to say a few words about this item and examine the present state of Canadian agriculture.
I have done so on many previous occasions, but there are some matters we have not had a chance to discuss.
When we analyse our agricultural situation today, we find a certain bitterness among that class of people who, after having chosen the most humanitarian calling of all, do not receive the reward they deserve for their efforts to maintain the standard of living of the Canadian people.
In fact, the income of the farmer is decreasing every year. His family income is not sufficient to maintain the morale of the head of the family, and that is why, each year, thousands of families leave the farm and join the ranks of the unemployed in our cities.
This agricultural stagnation has been increasing since the present government has been in power.
The Prime Minister (Mr. Diefenbaker), who posed as the champion of the farmers during the electoral campaigns of 1957 and 1958, has forgotten his promise to give the farmers their fair share of the national income.
The two ministers of agriculture who have successively been in charge of the department and have talked and talked in praise of the farmers and promised them higher incomes, are now concerned with other things-one has to decide for or against nuclear arms and has not made up his mind yet, while the other, unfortunately, has gone into enforced silence, a fact we all deplore.
I take this opportunity to say how pleased we are to see the Minister of Agriculture (Mr. Hamilton) among us today.
Mr. Chairman, before referring to the
detrimental situation of our farmers, analysing its causes and making the necessary

recommendations, I should like to give the house some expert opinions, for the benefit of those members who have accused me, as well as my colleagues here, of wishing to set western farmers against eastern farmers.
My statements in this house faithfully reflect the opinion of all agricultural experts and all eastern farmers in Canada.
In an article published in La Terre de Chez Nous, on May 24, 1961 we read the following:
The federal government is spending hundreds of millions of dollars each year for western producers.
So much the better for them, if those expenses can he justified. On the other hand, eastern producers are entitled to a fair treatment, through an intelligent and consistent use of a few million dollars which Ottawa is spending for them on grain.
In another article published in L'Action Catholique, on August 19, 1961 we read the following:
Would Mr. Diefenbaker have any objection to letting us know how many farmers we will have to sacrifice on his account, and how many plants will have to go out of business, before he goes to the trouble of taking the train to come and see for himself the extent of the damages caused by a shortsighted farm policy. Perhaps we could add that any other minister would do just as well-we are not so exacting as those western chaps who seem to have the nerve of calling the Prime Minister over for any trifle.
I would have other articles to quote but I will let the matter rest for now as my time is somewhat limited.
I will therefore confine my remarks to the present situation of agriculture.
On the basis of d.b.s. returns, it is noted that the net farm income for the fiscal year ending in March 1961 was $1,006 million, which is the lowest farm income since 1957.
Now, if we take the net average income for the last five years, we see that it was $1,185 million whereas the average of the last ten years before that period, that is from 1949 to 1956 inclusive, was $1,459,300,000. This means that, since the Conservative government came into power, the net farm income has been $274 million lower than during the last ten years of the Liberal administration.
Going on with our analysis, it is easy to find that the 232,000 farmers in the three prairie provinces, according to the 1956 census, shared in 1960-a normal year-a net income of $706.5 million, or $3,000 per capita, while the 343,000 farmers of the eastern provinces and those of British Columbia earned an average income of slightly less than $2,000 per capita.

It is true that in 1961, western farmers only had a net income of $1,600 each, because of the drought.
But if, during the other years, farm income fell, it was due to the failure of this government to exercise that price spread control promised by the Prime Minister.
The price index for goods and services bought by farmers shows, for the period from 1956 to August 1961, an increase of 40.2 per cent, whereas the index for farm products increased from 234.6 to 243.5. Practically, it means that goods and services for which the farmer paid $100 in 1956, cost him $114 in 1961. On the other hand, for each $100 of products he sold in 1956, he only got $103.75 in 1962.
Yet, the Prime Minister said on May 16, 1958, in Manitoba:
(Text):
-to farmers whose average family income has dropped from $3,600 to $3,000 since 1951, while the average income across Canada has risen from $4,100 to $4,900.
(Translation):
What will the Prime Minister tell the country's farmers about farm income a few months from now? If he is sincere, he will have to say that the individual farmer's net income has gone down from $3,000 to $2,000 and $1,600.
I should now like to say a few words concerning the dairy industry. At this moment, the situation as we find it is worse than ever before, due to the incompetence and lack of interest shown by the government in dealing with the dairy industry problem. If other emergency measures are not taken immediately, on top of the 12 cents per pound subsidy recently granted to butter producers, we shall find that industry on the brink of bankruptcy.
In eastern Canada, dairying represents the most important sector of the farming industry, the gross value of its production reaching a billion dollars.
Capital investments and outlays support that industry require tens of millions of dollars each year. The 1,900 different industries engaged in processing and distribution of milk products pay out $117 million each year in salaries to their 133,000 employees.
For us, in the province of Quebec, that is the main income of the farmer, since that industry represents 42 per cent of his farm income while in Ontario, it is only 21 per cent. It is 25 per cent in New Brunswick, 29 per cent in Nova Scotia and 17 per cent in Prince Edward Island.
Supply-Agriculture
It is in fact the main sector of farm activity since its gross production exceeds that of wheat, beef cattle, hogs, or that of any other sector of the farm industry.
Now, what is done to support that farm sector and to maintain the buying power of the people engaged in it?
The government has had a few acts adopted since 1958, among others the one dealing with price stabilization of farm products which reflects, after having been in force for four years, the sterility of the agricultural thinking of the ones who introduced it. That act to stabilize the prices of farm products received royal assent on January 31, 1958.
In its preamble, which I shall not read, it was said, among other things, that the act would protect farm income. The theory expounded in the preamble is very well drafted, but it cannot be said it is practical in its application, because the aim of that act was to influence the vote on the eve of a general election.
On May 1, 1958, the price of butter was raised from 58 cents to 64 cents a pound. That was before the general election. At that time, there was a surplus of 25.2 million pounds of butter, and at the end of the year, that surplus had increased to 79.3 million pounds.
Consumption, of course, decreased by one and a half pounds per capita. At the end of 1960, we had a surplus of 125.5 million pounds of butter. Again consumption dropped, and at the end of 1961, there was a surplus of 200 million pounds of butter.
That decrease of 4J pounds of butter per capita in the last three years is due to the fact that the retail price of butter was too high as compared to the price of margarine.
The decrease in consumption started four years ago, and the government did nothing to correct the situation.
The consumer was left at the mercy of dairy products' prices.
Actually, it is the workers and the heads of families who made up for the carelessness of the most biased government this country has ever had.
However, as the consumers are not always taken in, they have been buying margarine instead of butter. They refused to buy 70 million pounds of butter in the last three years, and, as a result, there was a 25 per cent decrease in the sale of that commodity, while the population increased by 2.7 per cent.
Is the farmer to blame for having increased his production? We could hardly blame him for improving his production technique and

we can use, both within and without our country , to fight hunger, misery and poverty, which are causing so much trouble in various countries.
Our farmers deserve the greatest tribute for their efficiency in increasing their production.
It is inconceivable that, through arbitrary measures, we should try to curtail it, when one third of the population is suffering from hunger and millions of children are dying of starvation each year.
The second principle is the following: the government should rely to a greater extent on farm organizations in the preparation, at the initial stage, of farm legislation and programs designed to improve the income of the farmers so that their standard of living may at least equal that of the working class. This obviously requires that two essential conditions be met by the farmers, and the government.
(a)	The unification of the large farm organizations under a single authority which would become the one official voice entitled to speak to the federal government on behalf of the farmers. This would not necessarily exclude provincial or regional organizations, nor those made up of producers of special crops such as beets, soybeans, etc.
We were glad to hear that the country's two largest farm organizations have entered into negotiations which, it is hoped, will result in their unification.
(b)	The setting up by the government of an advisory commission at both the federal and the provincial levels whose terms of reference would be to study farm matters. That commission could prepare a report each year and make recommendations according to the needs of each sector of farm production.
It is at that level that the planning policy should be discussed and the issues could be varied but comprehensive, since they would affect the production, the distribution, the processing and the marketing of farm products.
I think that marketing of farm products is the main point of a planning policy, since it is the phase the farmer is the less informed about. That is why, in the Liberal party platform, we advocate the setting up of a regular information service to work hand in hand with an independent research council which would promote the development of new food products and their marketing on both domestic and foreign markets.
Supply-Agriculture
At the present time we have recommendations to make to the government, which are of international scope and deal with the creation of an international foodstuff organization, similar to those already in existence for wheat and sugar.
That organization would play the part of a buffer in the distribution and pricing of agricultural products on the world markets.
There are other important principles which make up the planning policy of our party, but as I have not enough time to go into details, I will merely summarize them:
The improvement of the Agricultural Prices Support Act. That is to say, this act will have to be made flexible enough to permit the pricing of agricultural products in relation to their cost and the financial needs of the farming families.
Thus emergency measures should be taken immediately to safeguard the main industry of eastern Canada, the dairy industry.
Our party recommends-and intends putting it into practice-a system which would set a reasonable price for farm products and promote the marketing of these products, both on the domestic and foreign markets, and a program of milk distribution in schools.
In the United States, 80 per cent of the children in the public schools have access to some kind of catering service. In Canada, we have practically nothing of the sort.
Here are other policies advocated by our party: the improvement of crop insurance; easier credit for the improvement of livestock, drainage, for the consolidation of establishments, and to ease the transfer-


The Chairman:: I am sorry to interrupt the hon. member, but his time is up.
(Text):


Mr. Bell (Carleton):: If I might just say a word, the genial hon. member for Drummond-Arthabaska in my submission is under some misapprehension as to the nature of this particular vote. The principle of the main vote has been approved, and the issue before the committee essentially is the wisdom or otherwise of increasing the expenditure for the particular purposes which are set forth on page 13 of the book of estimates.
The additional requirements arise chiefly from increased travelling and removal expenses, mostly of international missions, including grain sales promotions, and intensified activities in relation to FAO, OECD and GATT. The issues which my hon. friend raises are ones which I should be glad to debate

Supply-Agriculture
with him on another occasion when I might express myself with somewhat greater vigour than I do when I appear before the house in the role of suppliant.


Lester Bowles Pearson: Mr. Chairman, we are on a
supplementary item of the Department of Agriculture, namely departmental administration, and of course as my hon. friend knows, under this item it is customary, whether in supplementaries or main estimates, to discuss the whole question of departmental administration. This is, I think, particularly relevant at this time when we have no assurance at all that we will be given another opportunity to discuss the Department of Agriculture.
I point out that when we were discussing the third set of supplementary estimates we did at least have ministers in the committee whom we could question about the departments under consideration. We are now on agriculture. The Minister of Agriculture is not in the committee. The acting minister is not here. There are two parliamentary secretaries in the Department of Agriculture, neither of whom is present. The Minister of Finance is not here. We are delighted to have the parliamentary secretary to the Minister of Finance here, and presumably he is going to bear the burden of the government debate on further supplementary estimates totalling $138 million. Mr. Chairman, I claim that this is not good enough in the discussion of such important matters as we are facing at this time in this committee.


Richard Albert Bell: Mr. Chairman, may I say to the Leader of the Opposition that the practice in the past, the practice in the government in which he was a member was that the Minister of Finance conducted the final supplementary items. Because of a matter of urgent public business the Minister of Finance must be absent this afternoon, and I hope the committee will be indulgent with me while I try to fill the role in accordance with what has been the customary practice.


Paul Joseph James Martin: Mr. Chairman, on the point that has been raised by the Leader of the Opposition, it is not a question of the suitability of the parliamentary secretary, in the circumstances; that is not in issue. What the Leader of the Opposition pointed out was that we are dealing with supplementaries totalling a large sum of money at a time when we are possibly engaged for the last time before an election in the discussion of items having to do with various departments of government. We certainly are not going to have an opportunity of dealing with departmental estimates as such in their usual form until after this parliament will have

been dissolved. That being the case, we are presented with a situation altogether different from what may have attended former practice -if in fact it is the practice, and that I doubt this very much-on other occasions.
Today, as the Leader of the Opposition has pointed out, we are discussing the departmental administration of the Department of Agriculture; and not only that, but afterwards we will go into atomic energy, citizenship and immigration, the civil service commission and a whole series of items on external affairs. The parliamentary secretary is in the unhappy position today, of having to discharge this responsibility, I believe without proper status before the committee-


Richard Albert Bell: Not at all unhappy.


Paul Joseph James Martin: Not unhappy, but ignorance is bliss when it is folly to be wise. The hon. member is happy possibly because he cannot be expected to know about all of the items covering the departments that are before us.
As the Leader of the Opposition has said, we do not even have the Minister of Finance with us. We have only the leader of the house-he is the only minister in the committee-and when we look at the government benches we find perhaps no more than 25 Conservative members in the committee at the present time.


Mr. Crouse:: That is not true.


Paul Joseph James Martin: That is a fact; and this at a time when we are beginning to discuss important items concerning proposals for expenditure by this government. The Minister of Agriculture obviously cannot be in his seat. We saw his condition today and it would be inhuman and most unfair to expect him to be here. We are not asking that the Minister of Agriculture be here; but there is an acting minister of agriculture in the person of the Minister of National Defence.


Lester Bowles Pearson: And there are two parliamentary secretaries.


Mr. Marlin (Essex Easl):: There are two parliamentary secretaries, as the Leader of the Opposition has reminded us. One of them has just come in, because undoubtedly he was called in by the alert whip, who himself is not in the committee at the moment.


Lloyd Roseville Crouse: This is untrue.


Mr. Jorgenson:: Mr. Chairman, I think I ought to correct the hon. gentleman-


Murdo William Martin: You can correct me after I have finished.


Warner Herbert Jorgenson: On a point of order-


Paul Joseph James Martin: There is no point of order.


Paul Raymond Martineau: What is the hon. member rising on?


Warner Herbert Jorgenson: Mr. Chairman, the hon. member is accusing me of not being here. I have been here. I went up to my room to take a couple of aspirins because I had a headache. In the meantime somebody called me and I was delayed for a few minutes. I may say that I got the headache from listening to the hon. gentlemen opposite.


Murdo William Martin: I must say, Mr. Chairman, that was not a point of order, and if I may say so with respect, that should have been indicated.


Paul Raymond Martineau: It is hardly fair to expect the Chair to know before the point of order has been stated. The hon. member has stated his point, whatever it may be, and the floor now belongs to the hon. member for Essex East.


Murdo William Martin: I am sorry if the hon. member was ill. He said he went up to his room to take an aspirin.


Warner Herbert Jorgenson: That was because of listening to you.


Murdo William Martin: I am sure he is not the only one on the other side of the chamber who will be taking aspirin after the next election. But the point is, we are discussing public business. Hon. members may have legitimate excuses for being out of their seats, as I am sure the parliamentary secretary had, who just intervened. However, that is not the point. We are discussing public business and we have the right to have in this chamber the ministers concerned with the various departments. We discussed the third supplementaries a few days ago. Each minister was in his place. The Minister of Finance, or the parliamentary secretary to the Minister of Finance, did not conduct the affairs of the government-


Paul Raymond Martineau: Order-


Murdo William Martin: -and surely we are entitled-


Some hon. Members:: Order.


An hon. Member:: Order. The chairman is on his feet.


Paul Raymond Martineau: Order. I believe the hon. gentleman has the right to discuss matters concerning agriculture, but I do not think it would be proper at this stage to discuss the past attendance of hon. members in this committee. I do not think that is at all relevant at the moment. I know that the hon. member will get back to this item.
Supply-Agriculture


Murdo William Martin: With great respect to Your Honour, I was not discussing the past attendance of ministers; I was discussing the fact that when we are dealing with supplementary items, as we are now, on the eve of a general election we have the right to have in the committee the responsible ministers for the departments concerned so we can put questions to them. We are not discussing past attendance; we are discussing the obligation of ministers of the crown, particularly when they come to parliament and ask parliament to give them money to carry on the various projects which they recommend.
If I were now to ask the parliamentary secretary questions about what is the sugar policy of the government of Canada with regard to sugar beets I would be greatly surprised if even so competent an hon. gentleman were able to give the kind of reply which thus far this session we have not been able to get from the Acting Minister of Agriculture or from either of his parliamentary secretaries.
I say to you, Mr. Chairman, this is the way this government regards parliament; this is the way it treats the public business and this is a further example of the arrogant way it has been acting toward parliament, particularly during this session.


Mr. Argue:: Mr. Chairman-


Richard Albert Bell: Mr. Chairman, I only want to say one or two words, and in somewhat different temper and tone than that which the hon. member for Essex East has adopted. The situation is that he has attempted to draw a comparison between supplementary estimates generally and the final supplementary estimates. The hon. gentleman said that on the last occasion supplementary estimates were before the committee each minister was here. That is true, and that has been the practice. However, the general practice of the house over a period of years has been that the final supplementary estimates should be taken by the Minister of Finance. That has been departed from on perhaps one or two occasions, but not more, to my knowledge.
The situation is that the Minister of Finance has been called away on important public business. If the hon. gentleman wishes to ask me for any information of a detailed nature, I will certainly either give him the answer or endeavour to get the answer for him as quickly as possible. I submit that there is no substance to the attempt of the hon. gentleman to suggest that in some way there has been a departure from what has been the traditional practice and procedure of this committee in the past.

Supply-Agriculture


John Whitney Pickersgill: Mr. Chairman, I would like to say a word in reply to the hon. gentleman concerning the point he has made on the point of order. The hon. gentleman talked about the practice when the previous government was in office. There is some substance in what he says about the final supplemen-taries when the previous government was in office, but when the previous government was in office the supplementaries were genuine supplementaries.


Some hon. Members:: Oh, oh.


John Whitney Pickersgill: They were the result of shortfalls in the original estimates. They were nothing like what we are being treated to in this parliament at this time.
I have in my hands figures for the further supplementary estimates showing the totals for the whole five years from the year ending March 31, 1953 to the year ending March 31, 1957 inclusive. The previous government in those five years brought in by way of further supplementaries $357 million. That was in a five year period. This is the fourth lot of further supplementaries introduced by this government this session and already the total for this year is $341 million, in further supplementaries, almost as much as in five years under the previous government.


Paul Raymond Martineau: The hon. member seems to be embarking on a debate right now. I had recognized the hon. member for Timiskaming.


John Whitney Pickersgill: I am speaking about the point of order raised by the parliamentary secretary.


Richard Albert Bell: I raised no point of order.


Paul Raymond Martineau: I understood the hon. member was raising a point of order. If he is, I will listen to him, but he should state his point of order and not begin to initiate another debate which to my mind would be foreign to the item before the committee. If the hon. member has a point of order I shall listen to him and if he has not I shall give the floor to the hon. member for Timiskaming.


John Whitney Pickersgill: My point of order has relation to the privileges of the house and particularly to the rights of the opposition in the house. In a moment I wish to cite a very celebrated authority on this particular point, an authority who I am sure will impress hon. gentlemen opposite. But first of all, sir I wish to draw your attention to the fact that we have a different situation here and I feel I have illustrated it rather graphically, when you think that in one single year we have had further supplementary estimates totalling $341 million. That is not all, sir. Just recently we considered further supplementary esti-
[Mr. Bell (Carleton) .1
mates No. 3. We now have $8 million being asked for for the same branches of departments which were up in the last lot of supplementaries. The same items are again involved. It seems to me that is evidence of the financial disorder that makes it necessary to have the ministers present to explain these items.


Paul Raymond Martineau: I still do not see any point of order in what the hon. member has said. The hon. gentleman referred to estimates that have been passed. I do not think it would be in order to bring them back before the committee in this debate. I would therefore call on the hon. member for Timiskaming.


John Whitney Pickersgill: Before you call on the hon. gentleman may I request that you hear the authority I wish to cite about the way in which the government is treating us.


Paul Raymond Martineau: I am willing to hear the authority the hon. gentleman wishes to cite but I am not quite clear concerning the grounds upon which this authority is being brought forward.


John Whitney Pickersgill: The ground is the very simple ground that an attempt is being made by a method of pressure on the part of the government to prevent a full and adequate discussion with full and adequate opportunities being provided us to obtain information before the voting of supply.
The authority I wish to quote is the hon. member for Prince Albert speaking in this house on April 11, 1957 when the right hon. gentleman, as he is now, said:
As I look back over the records of parliament when parliament was discharging its responsibility and maintaining its prestige, when estimates were carefully examined and critically condemned if improperly included among those presented, and compare that situation with the situation today, I can only say that this method of placing so many hundreds of millions of dollars of expenditure before parliament is a further insult and humiliation to this institution and to its prestige.
Indeed, I say this. It is a contempt of parliament to deny consideration except as provided in this general manner. We in the opposition have been willing throughout to co-operate.
Those words may be applied to this side of the house. We have offered co-operation at every stage but we do not feel that we should be gagged. A little later on-


Paul Raymond Martineau: Order. I believe this is a matter of debate. It is not relevant and it is not a point of order. I therefore must recognize the hon. member for Timiskaming.


Richard Albert Bell: That statement was made on interim supply.


Lester Bowles Pearson: Exactly.


John Whitney Pickersgill: Exactly, and you are going to try to give us an hour for that.


Mr. Bell (Carlelon):: That statement was made on interim supply and has nothing to do with this.


William Arnold Peters: Instead of having a discussion of the estimates of the Department of Agriculture it would appear that we are again having a discussion of Beauchesne's, which is not unusual in this committee.
I should like to know from the acting minister whether it is because of his ability in the field of agriculture that he is now piloting through these estimates. I believe we are having our last opportunity to speak on the estimates pertaining to the Department of Agriculture. Certainly the present incumbent of the office appears to have as much authority as anyone to state what is the agricultural situation in Canada today. Before referring to what has been said by the government in this respect I wish to quote a statement made by the hon. member himself in relation to agriculture:
New stabilization legislation has provided highest support prices. Payments to agriculture- 1953-57-$363 million; 1957-61-$706 million or an increase of 95 per cent.
That statement may be found in a pamphlet entitled "Report to the Electors of Car-leton" published by the hon. member for Carleton.
This is not without support from the economic division of the Department of Agriculture. They point out that:
During the first nine months of 1961, farm cash income from the sale of farm products reached the all time high of $2.12 billion. This estimate is 4 per cent above the corresponding figure in 1960-
I wonder whether this is fact or political speculation. I leave the answer up to the voters of Canada rather than the acting minister. I leave it to the voters to determine whether this is political speculation or fact. I question the right of the department in publishing this statement in the bulletin concerning the current review of agricultural conditions in Canada to draw the conclusions that are drawn. They are certainly not in keeping with the opinions of those in the agricultural community I represent or of those in other agricultural communities with whom I am in contact. On page 2 the following statement is made:
With increased national production, rises in labor income and higher farm cash income in 1961, and only a modest rise in the consumer price index for food, the year appears to have shown a general improvement.
It goes on to say:
Farm cash income: During the first nine months of 1961, farm cash income from the sale of farm products reached the all time high of $2,120.0
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million. This estimate is 4.0 per cent above the $2,039.7 million obtained in the same period of 1960 and 3.1 per cent higher than the previous record high of $2,056.8 million established in 1959.
What is involved is pointed out:
Major contributions to the increase in farm cash income from 1960 to 1961 were made by wheat, flaxseed, tobacco, cattle, calves, hogs, dairy products, poultry products and Canadian wheat board participation payments.
I want the committee to remember that included in the major contributions are products of the dairy industry. We are not questioning whether or not these statements are exact, but in doing some homework on this subject I examined figures from 10 or 12 different publications and found, although they were all taken from the dominion bureau of statistics figures, with very few exceptions did they bear any similarity. I presume it depends on how you use the figures, what application they have and what is considered in making up the figures. It is easy to say that farm income has gone up if you forget to say you are using a gross figure and that the net income is lower than it has been for many years in relation to many commodities.
Last evening we said we were happy that western agriculture appears to have solved most of its problems. It will be agreed that the gross income position of farmers will be improved as a result of large wheat sales reducing our national surplus of this commodity. The sales of grain to China and Poland have had a beneficial effect. It is important to remember that important sales have been made to new markets. The acting minister can take some credit for the fact that the Department of Finance-although it is questionable how it did it-has been able to give a guarantee which made these large sales of farm products possible.
I am pleased to note that today a further sale was indicated and that the original guarantee was sufficient to cover that sale. I wonder what this means. Does it mean that western Canada has had better representation than has eastern Canada? Or does it simply mean that the problem in eastern Canada is more diversified and therefore much more difficult to understand? I frankly think this may have been the case. Some of the things we have endorsed, because of this strong representation from western Canada, are not necessarily so advantageous to some of the eastern producers; and certainly some of the other Conservative solutions to problems of agriculture have not been necessarily advantageous to all producers in the country. I should like to mention only one or two facts.
The system we have used for community pastures and community feeding in western Canada has had a detrimental effect on feed

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production in the province of Ontario. I think it is also true that the changes we made in this feed and grain act a year or two ago may have been advantageous to western producers but that they have not been advantageous in eastern Canada. While we are not in disagreement on the reason why these things have been done, I would also note that consideration has been given to one area in the Canadian production at the expense of some of the other areas. I think this is probably the prime reason why, when the next government is formed in this country, if the New Democratic party forms the government, there will be an eastern minister of agriculture for the first time in a long while and he will bring more uniformity to the legislation throughout this country. I think one of the things that will happen immediately will be the establishment of a national marketing board. From listening yesterday to the western members we know that they are not opposed to this idea.
Mr. Pallet!: What does Mr. Douglas say about that?


William Arnold Peters: I doubt whether Mr. Douglas will be personally involved in that office. He certainly will have something to say about who gets it. I have not committed him in any way, shape or form as to who the incumbent will be. I am only saying that I am sure there will be a rather different distribution than there is at the present time.
From listening to the discussions yesterday, we know that many of the members from western Canada are not opposed to national marketing boards which, in the final analysis, offer a solution for most of the problems we have in agriculture today. We know that with respect to wheat we have engaged satisfactorily in operating marketing legislation that has been advantageous to the producer, to the consumer, and certainly to the country itself through the export program. I think there can be no argument about the matter. Perhaps I should not go that far, Mr. Chairman, because I know there is some argument. I was surprised that the hon. member for Greenwood should state that he was opposed to national marketing boards because they limit, direct and regulate. I was surprised that he should say he was opposed to them basically for this reason. I would suggest that most members from western Canada who have an interest in the development of this national marketing agency have agreed that there must be regulations; that control must be exercised over production; that there must be an equalization of payments across the country and the indication of an end price that will be competitive in the world market

if we are to sell a major portion of our commodities on the international market.
We in eastern Canada know that one of the greatest problems affecting agriculture is to be found in the dairy industry. That industry has been allowed to grow haphazardly in all directions. I think the farmers of eastern Canada are to be congratulated on the direction it has taken with so little assistance from government. We are now a large producer of dairy products. We produce so many of them that the government is now in the same position as that in which they were a year ago in the matter of wheat. They are worrying what they are going to do about the surpluses of these commodities. Last year milk production in Canada amounted to 19.2 billion pounds, an increase of about 4 per cent over 1960. All the provinces contributed to this increase in production except Manitoba. The national dairy herd had grown by
74.000	cows or 2.3 per cent by June 1, 1961, compared with the same date in 1960.
The fact that in eastern Canada last year we also had favourable weather meant that we were in a position to be able to increase our production and therefore to increase the surpluses that were piling up in certain commodities. One of these commodities to which the government has been asked to give consideration is butter. Many suggestions have been made as to what should be done about the surplus in dairy products. If you have followed them over the last five or six years, Mr. Chairman, you will know that the national dairy council and the component parts of it have been very much interested in each bringing forward a solution that will be satisfactory with regard to their particular commodities. These solutions have included the pooling of all fluid milk and equalization payments being made from one commodity group to another. Each of these solutions has met with some success and certainly with some resentment from members of their own organization and from the government. The national dairy council in recent months have been concerned particularly with butter. It should be pointed out that the situation that we have in Canada of a large surplus of creamery butter is not unlike the situation that has happened in other countries according to the World Dairy Statistics Digest which incidentally is a booklet that is not available in Canada. It is not available in the public library here and I understand it is not available from the Department of Agriculture. However, they point out that most dairy producing nations face the same difficulties as those with which Canada is faced. For example, the combined production of New Zealand and Australia increased from
35.000	tons a year in the first half of 1950 to about 400,000 tons since that time. They

go on to point out that each of these countries, and particularly those countries that are dealing with the largest available market, namely the market of Britain, have been suffering difficulties over the last number of years, and that these difficulties are increasing.
What did the government do about the matter? A year or so ago the government were asked to allow the producers in Ontario-I refer to the fluid milk producers in Ontario-to pay a subsidy to other segments of the industry so that the amount of surplus fluid milk could be fitted into the whole dairy program. When they came to Ottawa and asked for the government's assistance in this co-ordination plan, they were told that the federal government could not give them authority until they were licensed as a marketing agent of the province of Ontario. When they went back to the province of Ontario, the provincial government informed them that as far as they were concerned they were licensed far enough as an agency to be acceptable to the federal government. With this background the dairy farmers themselves or the Ontario milk producers set up an inquiry and went into the whole matter of marketing and the pricing of milk and cream in Ontario. Last September they established a marketing committee consisting of David MacFarlane, professor of economics, faculty of agriculture, McGill University, A. W. Wood, associate professor, department of economics, University of Manitoba, and John W. Carncross, professor of agricultural economics, Rutgers University, New Brunswick, New Jersey. They examined the situation and made certain specific recommendations to the Ontario milk producers. Their major recommendation was the establishment of an integrated marketing plan with a high degree of co-ordination of the policies of the several producer groups. They recommended that there be a central producers board and went on to say:
It is also judged advisable that the whole milk producers league be reorganized as a marketing board.
It is estimated that the cost of operating the board would probably amount to one-fifth or one-fourth of a cent per 100 pounds of milk or milk equivalent of cream. They suggested that the various dairy requirements be divided into groups and that consideration be given to all of them in a fairly uniform manner. The national dairy farmers of Canada presented a special committee report in Toronto on October 20, 1961, in which they pointed out the seriousness of the surplus butter situation and referred to certain things that they suggested should be done about it. This finally resulted in the request of the
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Canadian Federation of Agriculture for a subsidy of 14 cents a pound on the price to the consumer.
On March 23 the government made an announcement that it was prepared to pay a subsidy of 12 cents a pound effective May 1 next with the idea that such a subsidy would tend to eliminate or at least curtail the amount of the surplus which at January 1 last was estimated to be 197 million pounds. The Ottawa Journal of March 23 points out that about a quarter of this amount is in converted butter oil for which no economic use has been found, and the rest is in whole butter.
At that time I asked the minister if the government had any intention of giving additional aid to the whole milk industry as an industry rather than as a commodity group.
I did so because everyone connected with the whole milk industry knows it is one that has made great use of technological advances and through such technical changes is now able to produce more milk per cow than is the case in any other segment of the industry. Because they have improved milk production to this extent they have found that particularly during the spring, summer and fall when the cattle are on pasture they are producing more milk than the established quotas call for. This milk cannot be absorbed and this means that the surplus has gone into the production of butter and cheese.
There is a desire on the part of the whole milk industry and the commodity groups to try to integrate the surplus whole milk production into the whole industry so that it will not cause the large overproduction of butter. The acting minister may not be aware of how much this has affected the industry but certainly it has had a terrific effect. On occasion, production has been very close to 10 per cent over normal production of fluid milk. In 1960 surplus production amounted to about 15 per cent. This is a very important factor in the production of butter and in my opinion it has to be taken into consideration if we are going to solve the problem.
I wonder whether the farmers themselves have not failed to give consideration to something that is even more basic to the whole problem. There are certainly many figures available, in fact so many that it is hard to keep track of all of them. We know that in recent months there has been a terrific increase in the consumption of margarine and it seems to me that so far as the butter industry is concerned margarine is the most fundamental factor in the problem and also with regard to overproduction in the other segments of the fluid milk industry. In my view the government has a responsibility in this field.

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The federal government is going to pay a subsidy of 12 cents on the price of butter to the consumer. I am very curious to find out, and I think most people will be, on what ground the government assumes that the consumer will get the full benefit of the subsidy. I have discussed this matter with several people who are negotiating milk contracts in the Ottawa area, and they have pointed out that in the last few weeks dairies have informed them that they need two or three cents more to take care of their rising overhead. I wonder whether they are not going to take their two or three cents first. Is it unreasonable to expect that the retailer, who has never been averse to taking his cut on any product he handles, will also take another two or three cents? If the subsidy only amounts to seven or eight cents by the time it gets to the consumer, then I think the aim of the government in paying this subsidy will not be met.
In my view now is the time for the government to sit down with representatives of the national dairy council and decide what they are going to do about margarine. Most of the margarine production is by soap companies. Many of them are large producers of margarine. We know that margarine was introduced in this country because of the fact that during the war dairy production did not keep up with the demand and there was a shortage of butter at that time. For this reason a teriffic impetus was given to the production of margarine.
We also know that the increase in the consumption of margarine came at a time when the price of butter increased, and the higher the price of butter goes the more will margarine be consumed. We are also informed that the production of margarine is a very lucrative field for the companies manufacturing it and that there is a spread of 15 or 20 cents between the cost of production and what the consumer pays. I think the amount of money involved in this spread could quite easily be used to subsidize the consumption of butter if the government would control the production of margarine in conjunction with the whole dairy industry.
The farmers are now opposed to margarine and their opposition is shown by the necessity of having to colour margarine; but margarine is a basic commodity for many people in Canada who are in no position to pay 65 to 70 cents per pound for butter. I think the farmers would be in a more advantageous position if they would advocate the use of some of the large profit on the production of margarine to subsidize the production of butter. In this way it would be possible to reduce the price of butter to

the consumer because the government would have taken over regulation of the retail price of these commodities.
If the government does not regulate the retail price of butter at the present time, then I fail to see how they are going to get this 12 cents into the consumer's pocket which the dairy council hopes will mean an increase in the consumption of butter. The consumption of butter has fallen off somewhat, and it is hoped that this incentive will restore consumption to a point where it is more nearly in line with production.
I do not know whether or not everyone is aware of it, Mr. Chairman, but within the last year the production of margarine and other spreads has increased by 2.4 per cent in the month of December to 15,097,000 pounds from 14,743,000 pounds in December, 1960. On a full year basis, production amounted to 183,480,000 pounds, which was 10.4 per cent greater than the 166,641,000 pounds produced in 1960. The production of margarine and these spreads has been increasing steadily since they were introduced in 1949, and at the same time the consumption of butter has been decreasing. I believe these are very serious times for the dairy industry, Mr. Chairman. We all know that subsidization is not the ultimate answer. We have to arrive at a better system. Subsidization has been carried on not only in this industry but in others and we have seen it carried to the extent where a surplus of the product has been built up and we have not accomplished what we sought to accomplish.


Mr. Brunsden:: What is the alternative?


William Arnold Peters: There are many alternatives. The logical one is to sell the commodity. We found this was true in so far as western Canada was concerned. If it had not been for the fact that we were able to sell wheat, and if there had not been a drought, we would not have been paying the farmers of western Canada one dollar an acre but we would have been paying them $2 or $3 per acre. I think the fact the government did finally decide to push the marketing agency to the point where it was able to sell wheat, was the best answer. Canada is reaping the benefits of these international sales. In so far as dairy products are concerned, we are in a position where we can produce far more in this country than we are able to use. I completely disagree with those people who think we can double or treble the consumption of a particular agricultural product. I know that most people who can afford butter are going to use enough of it to satisfy them. I do not really believe they will use twice as much butter merely because the price is reduced, so this

is not the answer. If people are not getting any butter and are now buying margarine, the reduction in price will obviously induce them to use some butter. However, I do not believe those who are already using butter will double the amount they are now using.
I think the answer to this problem lies in something which the hon. member voted against the other day.


Edwin William Brunsden: Oh, no.


William Arnold Peters: Yes, he and every other member of his party voted against marketing boards.


Edwin William Brunsden: I rise on a question of privilege, Mr. Chairman. The hon. gentleman is implying that those of us who were here and who represent agricultural regions are against national marketing boards. We are not. We voted yesterday for the wheat board. We believe in national marketing. My friend has been talking about fluid milk, apparently without any comprehension of the fact that fluid milk marketing is a provincial concern and not a federal concern.


William Arnold Peters: On February 20 of this year, seconded by the hon. member for Vancouver East, I moved an amendment to the address in reply to the speech from the throne. It read in part:
This house regrets that Your Excellency's advisers have failed to give-


Paul Raymond Martineau: Order. I believe the hon. member is getting out of order because he is reviving a debate that has already been settled in this session.


William Arnold Peters: I only wanted to read the amendment against which the hon. member had voted. I am sure that if the hon. member had considered the matter he would know that his party had already made a decision on this particular matter in a way the Canadian public can easily check. I know that many of the agricultural commodity groups in this country are in accord with the views I have expressed, namely that in Canada we need national marketing agencies that will not only market one commodity on an interprovincial basis, as is being done now for many commodities, but we need marketing agencies large enough to handle the exportable surplus of any product.


Paul Raymond Martineau: Order. I regret to interrupt the hon. member, but his time has expired.


Mr. McMillan:: I think all Canadians are concerned about the 170 million pounds of surplus butter, and about the fact this surplus is likely to continue to increase under the floor price. I know this is a very difficult
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problem for the government. I believe last Thursday the government announced that they would be making a distinction between two classes of farmers, namely those who produced milk primarily for the butter market and those who produced milk for household consumption.
When I was home lately I found there was considerable confusion amongst the producers as well as the distributors of milk. I know that today the Prime Minister announced there would be some consultation with producers, I believe. I hope that some announcement will soon be made in this connection. I found that the people who were most disturbed were those who were producing milk to be sold to distributors for household consumption. They were concerned that their deliveries might be cut down and their prices cut. There is a distributor at home who has a moderate sized plant, buying about one hundred cans of milk a day for distribution. Up until a few months ago he used his surplus milk to produce butter which he sold at 64 cents a pound, thus contributing to the butter surplus. He became interested in increasing the market for milk products and started to make whipping cream out of his first grade surplus cream. He sold this whipping cream at 75 cents a quart on the week end, and disposed of over 100 quarts a week.
Now, I know that the price of whipping cream in the half pint and pint sizes is about double that price, but he certainly established a big market. This particular distributor claimed that selling whipping cream at 75 cents a quart gave him about the same return as he would have received if this cream had been turned into butter and sold at 64 cents a pound. This resulted in his withholding a lot of butter from the surplus butter market. In that small area this one distributor is withholding over 100 pounds of butter a week, or about 500 pounds a month from the market. This seemed rather novel to me and I think it is at least some proof that we might be able to increase the marketing of butter fat before it becomes butter. Certainly in that case it has been proven it can be done when the price is appealing enough to the public.
I do not pretend to know anything about the economics of the production and distribution of milk products, and I am not taking dietary considerations into account. The question also poses itself as to whether with an increase in the sale of whipping cream there might be a decrease in the sale of butter, but in the instance I have cited I have been told they did not cut down their butter sales, and did not appreciably cut down their sales of whipping cream in the smaller half pint and pint containers at the original price.

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I do not know whether the government has given any consideration to this aspect of marketing milk and milk products. I heard the hon. gentleman to my left say that their sale comes under provincial jurisdiction. I believe that the decrease in the selling price of butter will encourage its consumption but in so far as we have to put up a lot of money to buy this surplus butter it behooves the *federal government to give consideration to the sale of butter fat before it is manufactured into butter. In view of the fact that in one small area a single distributor has been able to take 500 pounds of butter a month off the surplus market, I wonder could it be done in other parts of Canada. I have never heard of its being done elsewhere.
(Translation):


Mr. Racine:: Mr. Chairman, I want to make a few remarks on the item under consideration, in view of the fact that, as it was said a moment ago, it is probably our last chance to do so.
I want to discuss two questions which are of particular interest to me: the advertising agency of the dairy industry and the possibility of increasing milk distribution in schools.
On March 12 instant, the hon. member for Drummond-Arthabaska (Mr. Boulanger) asked the Minister of Agriculture (Mr. Hamilton) a question concerning an advertising agency which was to launch a campaign to promote the sale of butter. The minister, through his representative, answered as follows:
The government of Canada did not appoint a butter advisory committee of Canada. However, in I960, the government employed a public relations firm to conduct a butter promotional campaign. In the course of its work this firm named a butter advisory committee to assist them in an advisory capacity. This committee consisted of seven members.
A little later, he added:
Six meetings were held on the following dates: October 31, 1960; November 22, 1960; January 5, 1961; January 27, 1961; February 17,	1961; and
March 23, 1961. The committee concluded its functions during May, 1961.
In my opinion, the committee could have carried on its work, because it had at its disposal an ideal instrument to boost propaganda in favour of the sale and food value of dairy products. It could have fought against the vocal and misleading publicity which is being made about what are called non-saturated fats from a salad oil made out of com. On account on that publicity, many people are wondering whether butter fat and certain animal fats would not be the cause of heart trouble, which is absolutely wrong.
In the United States, authorities in charge of the implementation of the food legislation

have issued many statements to the effect that such publicity was false and misleading. In fact, they have stated that there is as yet no evidence of any relation between the proportion of cholesterol in the blood and heart trouble, and that nothing justifies any substantial change in the food diet generally in use in the United States, nor to the eating of fats which it involves. If we refer to certain statistics to be found in U.S. documents, we find that in the United States butter consumption amounts to 8 pounds per capita as compared to 18 pounds in Canada. Those figures are for the year 1959.
We have other figures we can use as a check; for instance, the number of deaths caused by heart trouble in 1959 was 270 per
100.000	in the United States and 234 per
100.000	in Canada. The proportion was lower in Canada while butter consumption was higher.
That committee could have counteracted the effects of that misleading publicity. It could also have endeavoured to destroy a wrong impression about milk contamination by strontium 90, because it is the food that contains the least amount of it. The danger is almost non-existent, if we remember that the cows eliminate 95 per cent of what they absorb in their own food.
The committee could have made several suggestions to the government, which could have guided it in its legislation.
The situation will become alarming if we do not take steps at once to stop the decrease in butter consumption.
In the last few years, it has decreased by one million pounds a month. While the per capita consumption of butter stood at 20J pounds in 1957, it went down to 15.1 pounds in 1961.
It must also be kept in mind that 395,000 farmers derive 67 per cent of their income from dairy products.
That is why I would urge the government to reorganize that national advisory committee whose purpose is to promote the sales of dairy products.
I should like to deal briefly with another matter that is of concern to me, that is the distribution of milk in schools. It is rightly said that this distribution would be best organized in co-operation with provincial governments. It is felt that apart from making up for the pupil's failure to have breakfast, milk is a wholesome food which can compete with other beverages often more harmful.
Third, this would be a way to get rid of surpluses, if we consider, for instance, that in 1958-59 there were 3,780,000 children in

grade schools, while that figure is expected to rise to 4.2 million in 1964-65 and to 4.76 million in 1969-70.
In the December 1961 issue of L'Economiste agricole, the present situation in the United States is described, as follows:
In March 1957, a catering service of some kind was available to 80 per cent of the children attending public schools. Milk distribution facilities were available to 90 per cent. Thirty three per cent got a complete meal every day (based on the daily average of the month). Milk consumption reached the equivalent of one pint per day for the total number of children attending public schools. On the average, those children had to pay 24.3 cents per meal under the N.S.L.P. program and 3.1 cents per pint of milk, under the S.M.P. program. During the school year 1957-58, the children attending public schools consumed $619 million worth of food (wholesale price, including the price of lunches and milk), that is $19 per child on the basis of the total registration in public schools. 47 per cent of that amount was for dairy products, of which 35 per cent was for plain milk.
That, in my opinion, is proof in support of that policy which the present government could follow in Canada.
On the average, each child consumed 59.8 pounds of plain milk. The total cost of the national school lunch program and of the special milk program in both public and private schools amounted to an estimated $926 million in 1957-58. The federal share totalled $241 million, that is 26 per cent of the whole or $6.28 per child, on the basis of the total registration in public and private schools.
Our agricultural organizations have long been considering the question of milk distribution in schools. Thus, La Terre de Chez Nous has published a U.C.C. report concerning the distribution of milk in schools. In my opinion, that report contains most interesting information which could help make that idea become a reality.
Indeed, a large number of agricultural organizations have long been advocating the distribution of milk in schools.
American and British experiences in this field also support the adoption of such a policy, even though the results in these two countries are far from complete and, therefore, cannot be too readily analysed.
Health experts also agree on the high food value of milk, especially for the growing child.
Now, children, and especially teenagers, are always being urged by advertising to buy all sorts of beverages without any food value.
The distribution of milk in schools, in addition to improving the diet of many children, would supply them with a basic food and give them a good eating habit.
We know that the country, and particularly the federal government, has a disposal policy.
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They grant subsidies to concentrated dairy products industries and make substantial gifts of skim milk to nations which often are underfed.
We support that policy because it sometimes becomes urgent to dispose abroad of a product which is chronically in surplus.
On the other hand, such action is often exposed to severe criticism by the general public who do not always realize the economic reasons for that initiative but think that moneys spent that way could serve a better purpose if they were used to feed our own children.
During the school year 1958-59, as I said a while ago, there were 4 million children in primary, secondary and private schools. And the figure I gave then rather concerned the birth rate.
However, through the development of a milk distribution policy in schools, the government would reduce dairy surpluses and would kill two birds with one stone, since this would contribute to decreasing our Canadian stocks. Moreover, such a policy would give impetus to the dairy industry, so that it could become successful in some areas of our country where it is practically non-existent. If our dairy industry became prosperous through this policy, many of our farmers who have to depend upon the income from that industry would therefore benefit from such a distribution of milk in schools.
I hope that the government will consider this measure and that, in co-operation with the provinces, it will find a way to have this policy implemented by the various governments.
At present, on the eve of an election and especially with the warm electoral campaigning which we know, speakers on the government side praise the agricultural policy followed during the last four years. Indeed, one can even hear members declare that they saved agriculture .by passing the Crop Insurance Act.
However, I asked the Minister of Agriculture the following question on February 12, 1962:
Which provinces have agreed to the federal crop insurance scheme?
To which he replied:
The province of Manitoba entered into agreement with this government under the provisions of the Crop Insurance Act on May 24, 1961. Agreements are expected to be concluded with Saskatchewan and Prince Edward Island in the near future.
That answer clearly indicates that the enactment of the Crop Insurance Act failed to

Request for Transportation Policy interest every province, since as yet, only one has entered into agreement and two others are examining the proposal.
And the same goes for the Farm Credit Corporation.
To another question of mine on February 14, 1962, the reply was that only 44 farmers from the province of Quebec had secured loans in excess of $15,000, under part II of the Farm Credit Act.
There again, we can see that even though the act does not contain any reprehensible clause, in my opinion, even though it is well drafted, it does not as yet render the services it should, because only 44 farmers from Quebec have taken advantage of part II of the Farm Credit Act, under which loans in excess of $15,000 are permissible.
Mr. Chairman, may I call it five o'clock?
(Text):


Paul Raymond Martineau: Order. So that the house may proceed to the consideration of private members' business pursuant to section 3 of standing order 15, it is my duty to rise, report progress and request leave to sit again later this day or at the next sitting of the house, as the case may be.
Item stands.
Progress reported.


Mr. Speaker:: It being five o'clock the house will proceed with consideration of private members' business.



TRANSPORTATION


Erhart Regier: That, in the opinion of this house, the government should give immediate consideration to the development of a national transportation policy so that the transportation needs of Canada can be met with a minimum degree of subsidization of competing forms of public transport.
He said: Mr. Speaker, I want to tell the house that I intend to be very brief because in the time allotted I should like to hear as many other hon. members as possible express their opinions on what is to me a very serious problem in Canada. I recognize at once, and I want to open my comments with the admission that Canada covers an area of roughly 5,000 miles from Victoria, British Columbia, to St. John's, Newfoundland. We are, relatively speaking, a greatly underpopulated country. It is possible that there is no country in the world with the problems and headaches that Canada has in the field of transportation. This being so I also recognize

that it may well be that the public purse will always, in one form or another, be called upon to subsidize public transportation in our country in order to keep at a sufficiently low level the rates being charged for the movement of goods and people.
In the past we have had a large number of royal commissions that have been charged with the responsibility of investigating various transportation problems. The most recent of these was the MacPherson commission which investigated transportation by rail in Canada. We have in this nation two main national railway systems. There are also a few smaller railway companies. In British Columbia we have our famous P.G.E. and in Ontario there is a northern railway system; but in the main we have two large railway systems which may be described as national systems. Both of these receive government subsidies in one form or another. I often doubt whether this country has sufficient population and a sufficient passenger and freight traffic potential to be able to afford the luxury of having two competing national railway systems. At this time I do not wish to argue the merits of private ownership versus public ownership but it appears to me that the idea of integrating Canadian railways deserves much more serious consideration than it has received till now. I am not sure that it would not be wise to sell the Canadian National Railways to the Canadian Pacific Railway or to have the Canadian Pacific Railway absorb the Canadian National Railways system or integrate with it.
However, my motion goes beyond the problem of railways. There is no form of public transportation in Canada that is not now in receipt in one form or another of heavy government subsidization. Our air lines are subsidized if in no other way than through the taxpayers providing growing extensive airport facilities. In addition to that, the estimates now before the house contain the huge deficit of Trans-Canada Air Lines.
It is likely that our trucking industry will deny that it is being subsidized. However, if one examines the tremendous expenditures made on highways by federal and provincial governments it can scarcely be denied that this industry is also in receipt of subsidization, although it is paid indirectly, it is true, by the taxpayers of Canada.
We subsidize rail transportation. The taxpayers also subsidize road transportation. Most bus lines are in receipt of public subsidies. Our water transportation is heavily subsidized. The taxpayers are called upon to pay for the construction of canals, harbours and the like. We have only to think of the tremendous expenditure caused by the deepening of the St. Lawrence seaway. I understand we pay 40

per cent of the capital cost of building ships in Canadian shipyards. I am not too sure we are not wasting hundreds of millions of dollars of the taxpayers' money in failing to integrate available transportation, putting it on a basis to adequately serve the transportation needs of our people.
Because this is a complex problem there is no ready solution and because it is a long standing one there is no real urgency to it. I would even like to advocate the appointment of a royal commission on transportation but I would urge that it be not limited to dealing with only one aspect of transportation. I believe you cannot isolate one form of public transportation without paying attention to competing forms. This government and governments of the past, I believe, have always made the mistake of limiting the terms of reference of previous royal commissions to only one form of public transportation. You cannot arrive at a solution to the problem of railway transportation unless you have considered all the other forms of transportation available.
I should like to see appointed a royal commission that would, in the first place, assess and receive expert advice on the existing transportation needs of the nation and also the likely future transportation needs for at least the ensuing 20 year period. I should then like to have the commission assess and receive advice on existing facilities in the field of public transportation and on probable future developments in this area. Only when we know our national needs and have received adequate and expert advice on existing and probable future transportation facilities can a national board of transport commissioners advise concerning ways and means of best resolving our problems.
I feel we are indulging in a luxury our country can ill afford. We are subsidizing air lines, the trucking industry, bus lines, railroads and transportation by water all for the rather dubious privilege of maintaining a phony free enterprise system of transportation in Canada. It is not free enterprise in that it is in receipt of subsidies at a tremendous cost to the taxpayer. I feel it is time that we as reasonable men and women examine the whole field of transportation and discontinue our present and past policies of examining only one form of transportation hoping we can resolve the problem by blinding ourselves to the problems and needs of other available modes of transportation.
After all, if we use a dollar of the taxpayers' money to lure a passenger on our air lines we require another dollar of the taxpayers' money to give to the railroad in order to compensate the railroad for this loss of business. Every time we take 26207-1-145J
Request for Transportation Policy a ton of freight and subsidize the taking of the ton of freight off our railroads and putting it on to the highways, not only are we obliged to spend the dollar to make possible this transport on the highways but at the end of the year we are also faced with a deficit on the part of the railroads and we are obliged to spend another dollar by way of subsidy to the railroad for loss of business.
I feel that our habit in the past has been most unreasonable; it is not realistic. I believe that half of the money the taxpayer is now spending in subsidies in the field of public transport might be saved. I believe that not only would we end up with more stability, more assurance and more efficiency in the field of transport but that we would save ourselves and the taxpayers a great deal of money for which many more worthy causes exist.


Mr. Grant Campbell (Stormont):: Mr. Speaker, my remarks will be brief and strictly extemporaneous. There are certain advantages to being a backbencher, even a government backbencher, as he on occasion can afford the luxury of integrity or, if you prefer, irresponsibility. I think it is on occasions such as this one that ordinary members can and indeed should speculate on the shape of things to come.
On more than one occasion I have said in this house that this country of ours, this Canada, is a monstrosity. It is a monstrosity in this sense: it was created in defiance of geography and economics. Only our history holds us together. It was the passionate desire of our ancestors to live under the old organic form of life to which they had been accustomed for generations rather than a republican form of government. It was the desire of our French Canadian compatriots not to be submerged and lose their identity in the North American Anglo-Saxon mass. These are the reasons that cause us to continue as a separate country with a separate and unique identity.


Mr. Benidickson:: Oh, there were French people here also.


Grant Campbell: Although we do this we must pay a price for it. Because of current developments throughout the world the question now is whether we are going to be able to continue to pay this price. I think certain modifications, and probably substantial ones, may be necessary. In Canada, of course, it is a commonplace that the thing which basically held our country together originally and which to a large extent does so even today is our transport system, those two bands of steel that have welded us from sea to sea, in contrast to all the geographic

Request for Transportation Policy lines going north and south. There is the fact that the Saskatchewan prairie farmer and the Montana prairie farmer are subject to the same droughts and the same storms, that in a geographic sense the maritimes are a natural prolongation of the Atlantic seaboard to the south; and so on right across the country. As anyone who is acquainted with that area knows so well, west coast British Columbia, is in many respects much similar to and encounters the same problems as do Washington and Oregon to the south. They both suffer from claustrophobia because they are isolated by the shining mountains.
It is interesting and, in fact, it is very disturbing today, 20 years later, to observe the tremendous contrast between the economies of western Europe and that of North America. One would almost think today that the new world, the world of vitality, the world of growth is in western Europe, whereas North America to a degree, since the artificial prosperity of the post-war period, appears to be in a state of stagnation. One probably valid assessment of the reasons for this situation I ran across the other day in an article by Anthony West in the Saturday Evening Post. I should like to read a couple of paragraphs which I think are most pertinent with reference to the United States and to the comparative slowness of its growth in recent years as compared with the European common market. The article states as follows:
it-
The United States.
-has adopted all the devices beloved of leftwing economists by which the private sector is made to finance state enterprise, the steeply graduated income tax, corporate income tax and capital gains. But while these do inhibit the healthy further progress of private capitalism they don't produce any compensating social benefit because the prevailing devotion to free enterprise prevents the State from making any constructive use of the money.
Then it goes on to state this:
The private capital mopped up by the tax apparatus is squandered as income in the public sector. A grotesque proportion of it is frittered away on three wholly sterile items; paying farmers to grow unsaleable commodities, building unwanted roads and preparing to send cans into outer space.
In our own country the situation differs to a considerable degree. Our farmers, being in the unfortunate position of buying retail and selling wholesale, need every assistance they can get. I think the present government, in comparison with its predecessors has been very much aware of this problem and is showing a continuing awareness of it. Fortunately, we are not obliged to contend with the perhaps quite acute problems of defence with which our neighbours to the

south are obliged to contend. However, perhaps one of our most vexed problems today in Canada is that of transportation. It is one of our perennial problems. Railways, although in some ways obsolete, remain essential to Canada. This fact becomes especially evident in times of war. However, it is also obvious that they are being squeezed between competition from air lines and buses for passenger traffic and competition from trucking for freight. Nevertheless, because of our vast distances, they remain essential to the actual survival and operation of our country.
The question is this: how can we make the most efficient use of our transportation system? How can we minimize duplication of services? How can we get the most value for the dollars that our taxpayers spend in all sorts of assistance and subsidies, both open and covered? It seems to me that any time you drive along the highway, especially at certain times of the day, it is almost impossible to do so because of obstruction caused by these huge transports. They cause the greatest wear on our roadbeds. Nevertheless there is, as has been mentioned, this substantial subsidization, although not an obvious one, to the whole trucking industry in that they are not obliged to provide their own roadbeds as the railways do. Again you have the vexed and perennial problem with which we have to contend in Canada, namely that of concurrent jurisdictions as between the provinces and the federal government. It is one that is found in any federal system. But it would seem that possibly the provinces, which have the direct responsibility for highways, might consider further contributions from the trucking industry toward the upkeep of those highways.
I realize that the whole matter of transportation and especially the competing railroads is an inherently and extremely complex and complicated problem with all sorts of nuances and implications, but I believe that ultimately we will be forced, because of increasing expense and increasing demands elsewhere, to consider some sort of rationalization of this system, some sort of integration of our two railway systems either by the government buying out the C.P.R. or selling the C.N.R. to the C.P.R. or to private capital so that the two systems can be incorporated into one rational, serviceable, efficient operation.


William Moore Benidickson: Amalgamation again from a Conservative.


Grant Campbell: Quite. We know that in earlier days there was almost a mania of building unnecessary and uneconomic lines, many of which were brought into being by

Mackenzie, Mann and other Liberal promoters. Finally the situation reached such a state of confusion that the whole system broke down and Mr. Borden's government of that day just about the time of the war crisis was confronted with the possibility of Canada's financial reputation abroad being jeopardized by the threatened bankruptcy of these railways. Faced with this dire situation, in order to protect our credit rating throughout the world we were obliged to amalgamate these inefficient, bankrupt railroads into some form of coherent system.
With the increasing competition that the railways are being confronted with from other forms of transportation in this rapidly changing age, it seems to me that the day may not be too far distant when we must look at the whole situation again, and this time not only the railroads but their competitors, and somehow or other form a rational, integrated system that will best serve the people of Canada with a minimum of unnecessary expenditure and waste.


William Moore Benidickson: Lord Bennett bankrupted the employees.


Hazen Robert Argue: Mr. Speaker, the motion before us suggests that the house should give immediate consideration to the development of a national transportation policy so that the transportation needs of Canada can be met with a minimum degree of subsidization of competing forms of public transport. In my judgment the whole question of a national transportation policy cannot be centred around one single objective, namely to reduce the amount of subsidization of transportation. Indeed, I would suggest that it is not just a question of subsidization out of the public treasury. There may be a great many ways by which subsidization can take place. Freight users in the maritime provinces and freight users in the prairie provinces will say that they have been subsidizing the railways for years by paying unduly high freight rates. Before we agree to take this very simple idea and go forward on this basis, I think we should judge where this kind of policy could lead.
The hon. member for Stormont (Mr. Campbell) talked about the growing competition and then made the rather sweeping suggestion that, at least as far as railway transportation is concerned, there should be an amalgamation of the systems either as a government monopoly or a private monopoly. I think the country is plagued now with too much monopoly without having the suggestion made that by action of this house support
Request for Transportation Policy should be given either to a public monopoly or a private monopoly in the transportation field.


Grant Campbell: On a point of order, Mr. Speaker, I think I have been misinterpreted. What I was advocating was that the whole transportation system of the country be investigated, not only the two railways but their competitors, and that a thorough study be made of all systems in order to arrive at some sort of rational solution.


Hazen Robert Argue: Mr. Speaker, I do not think that is a point of order. The record stands. The hon. member made his statement and I think my interpretation of what he said is accurate. He wanted amalgamation of the railways, he said, either by the C.N.R. buying out the C.P.R. or the CP.R. buying out the C.N.R., but whichever way it is done it is a monopoly in the railway business which I think would be a very great mistake at this time. I think it would meet with opposition from the public generally and very strong opposition from the railway employees.
The central theme of this motion is very much the central theme of the second volume of the report of the MacPherson commission on transportation. In very sweeping conclusions the MacPherson commission says in effect, "Let us take off all regulations and controls step by step", but the idea is to take off controls and remove subsidies. Over the years I have seen a transportation policy being developed in this country, inadequate in many ways but being developed, which has had as a very significant part thereof the payment of certain subsidies out of the national treasury of the country as a result of very careful studies having been made by royal commissions in the past, recommendations having been made by those commissions and parliament having acted upon those recommendations.
Mr. Justice Turgeon, at one time chief justice of Saskatchewan, who is an authority in this field, has headed royal commissions in the past and has made very important recommendations. I for one would hate to see the bridge subsidy of $7 million, which helps to carry the traffic between Sudbury and the lakehead, removed. This, of course, is something that would have to be considered under this motion. The member who introduced the motion said that we should be able to save half of the subsidies. I would hate to see action taken to remove this subsidy or even to reduce it by half.
Another recommendation by the MacPherson commission appointed by this government was the removal of part of the subsidy
2274	HOUSE OF
Request for Transportation Policy that is being paid within the maritime provinces on freight moved within the Atlantic provinces. I would expect that members from those provinces would need to take a very careful look at this recommendation before they agreed with it.
There is another recommendation in the report that I think members from eastern Canada, certainly rural members, would oppose, and I think they should oppose it. I refer to the recommendation that the $19 million transportation subsidy on feed grain shipped from the prairie provinces to eastern Canada should be removed. 1 think that would be a step that would cause a great deal of opposition and should not be accepted without question, even though it is recommended by a commission headed by a person of the prominence and ability of M. A. MacPherson.
Another central recommendation is that to aid the railways, they should be allowed to tear up the branch lines in this country and save for themselves the additional moneys that it would cost to operate those branch lines. I believe this is a policy that should be looked at very carefully. I am amazed, Mr. Speaker, and I am disturbed that this particular recommendation, so far as I have been generally able to ascertain, has been accepted even by organizations whose members will be very adversely affected, as something that is inevitable and is going to happen. They seem to say, well, let it. I think before we say, let it happen, we should look at some of the results if it should happen.
Some farm organizations have been interested in this particular question. The Canadian Federation of Agriculture attached appendix D to its brief to the cabinet dealing with this particular part of the recommendations of the MacPherson commission. In addition to saying, let us find out what the railways wish to do and have them divulge their abandonment program at least five years in advance, the main recommendations of the federation are, the need to provide accelerated depreciation on elevator facilities on branch lines that are to be abandoned; the need to provide for the depreciation of the undepreciated value of facilities still there when abandonment takes place, and the need for accelerated depreciation on new facilities to be built because of the abandonment of certain branch lines.
This is, of course, of great importance to the elevator companies and the grain companies that will be affected. My remarks are not in any way critical of the people who put forward these particular proposals. However, I would suggest that the results to the members of these organizations, the farmers who are members of these organizations, will be much more drastic and, in general, much more important than the results to the elevator


companies themselves, although these will be of unquestioned importance. People all across this country from one coast to another in these areas served by branch lines have built their businesses, have built their farms, on the basis of railway service coming into their area. If you remove that railway service, you depreciate the value of the businesses that are operated within the towns and depreciate in one stroke, in a very substantial manner, the value of the farm businesses that have been built up over many years.
I suggest that it is the ordinary people, the ordinary freight users, the ordinary citizens that have been forgotten both in the MacPherson report and in this particular resolution. It is these people who will suffer, and suffer very seriously from any wholesale abandonment of either subsidies for transportation or branch line railways. Suppose, for example, a farmer has built his farm business, purchased his land, paid for it and engaged in this operation on the basis of a railway market which is five miles away. Suddenly, overnight the branch line is abandoned and he has to go 50 miles to market. The value of his property is reduced immediately; his transportation costs go up and his profit margin is reduced as well as his standard of living. This is one of the results that will flow from any wholesale implementation of the MacPherson report, namely the transfer of wealth from the ordinary freight users, businessmen, farmers and others, who live in communities surrounding branch lines, into the coffers of the railway company. I suggest that this is something that should be approached very carefully.
Now, I think it is true that one could not advocate that uneconomic branch lines or all uneconomic branch lines should be maintained indefinitely. However, I do suggest the economic results that flow from the abandonment of branch lines should be considered and a policy should be designed to deal with more than accelerated depreciation for the very large business firms connected with the use of these branch lines. I would suggest that there are a number of factors that should be considered whenever a branch line may be abandoned. First of all, the ordinary facilities should be certainly maintained for the people in those areas. Where mail has come by railway, and this happens to a lesser degree every day, the same service should be maintained by truck transportation. I would suggest further that federal action should be taken in co-operation with the provinces and the railway companies to ensure good all-weather highway facilities wherever branch lines are abandoned.
1 would suggest further that the government, in addition to considering accelerated depreciation for large businesses should

consider a policy which would provide moneys by way of compensation, not only to large business firms but to smaller businesses and to farmers who suffer direct and severe personal financial loss as a result of the abandonment of railway lines. There are a number of ways these payments may be made. Money should go to make certain there are good highway facilities. In so far as grain producers are concerned there might be some compensation in the price paid for the grain to compensate the farmer for having to truck his grain 40 or 50 miles when he has built his business on the basis of a haul of only 5 or 10 miles. This same kind of consideration could be given to the transportation of livestock. It may be possible to provide accelerated depreciation not only to large companies but for the investment of ordinary people themselves. I suggest that over the years subsidies in this country have become an important part of our transportation policy. "Subsidy" should not be considered a bad word.
Who can say what really constitutes a subsidy? There are subsidies that are paid, as I have said earlier, that do not come out of the national treasury. Some members of parliament may be underpaid and some may be overpaid. If some are overpaid, then I suppose that is a type of subsidy.
If some people have to pay unduly high freight rates then that is a type of subsidy to the railroads. The question is whether we can get a national transportation policy that is geared not only to the needs of the railways and the main transportation companies themselves but will provide protection, compensation and a cushioning effect from the economic results that will bring hardship to ordinary citizens when changes of a technological nature are necessary.
This is not a new concept. We have had other legislation which says that certain areas are depressed and that certain action will be taken by the government to assist in maintaining or establishing industries in them. All I am saying is that we should not accept this motion precisely as it stands now, nor should we accept the recommendations contained in the MacPherson royal commission report without making certain that within our national transportation policy there is a real degree of equity not only for the transportation companies involved but, of even more importance, for the ordinary citizens who must use these very necessary facilities.


Mr. Morris:: Would the hon. gentleman permit a question which is not of an antagonistic nature? I hope to participate in this debate later as a private member, but the hon. gentleman spoke of the Maritime Freight Rates Act and the 20 per cent internal subvention on
28,	1962
Request for Transportation Policy goods moving within the maritimes area. I wonder has he a view as to whether it would be better to continue that subsidy, that subvention, internally within the Maritime Freight Rates Act territory or take that subvention and apply it in the form of a new subvention to the products of secondary industries leaving the region and going outside it.


Hazen Robert Argue: I think we should be careful
not to abandon what is already there. Of course the freight rates act provides for a subsidy going outside the provinces, and my initial request would be to let us give the maritimes a greater benefit in toto instead of cutting off some of the benefit they now have.


Grant Campbell: Would the hon. gentleman permit another question? I am just wondering where he got his indoctrination in Gladstonian Liberalism.


Paul Joseph James Martin: Any intelligent man who reads can get it.


Mr. Terry Nugent (Edmonton-Strathcona):: The resolution before us takes in a tremendous amount of territory and I shall try to confine my remarks to a small part of it, as otherwise I am afraid it would take a very long speech to touch on all it contains. First of all, I am impressed with the thought that the wording of the resolution gives another indication of the opinion we often receive from the socialist comer of the house, that all that is needed is more and more government control in order to take care of some of the financial difficulties which industries might suffer from in this country.
My first reaction to the resolution is one of extreme caution that we are again being asked to do even more planning with regard to the transportation industry, which is perhaps the biggest business we have. It touches every phase of life and it embraces the field of public transport, private transport, indeed all methods of transportation. It perhaps involves more expenditure of money than any other single industry we can name, and to suggest that we should have a national transportation policy is taking in a great deal of territory.
The hon. member who introduced the motion mentioned only public transport, but his resolution is very wide, covering as it does "the transportation needs of Canada". I do not say that there has to be less subsidization but I would point out that the more government interferes, and the more direction government tries to give to developing the various transportation facilities, then the greater is the response of industry saying "Well, you have regulated, now you support

Request for Transportation Policy it." Therefore we cannot have more direction from the government without considering responsibility for the costs entailed in the service.
For instance, I know that in the field of air industry the general policy of the air transport board is to select areas in which carriers are to operate, the theory being that there is only so much business, that it is a very expensive business to enter, and that if the potential business in an area is not carefully guarded it will not be possible for any carrier to make money. An area would be broken up so much that it would result in poor equipment, poor safety standards and poor service.
However it has been my experience that sometimes the board in pressing that policy reaches the point where, in its anxiety to make sure that the air industry is itself healthy, it forgets that the ultimate policy of a healthy air industry is to serve the needs of the community and area in which a particular company is operating. This same policy and thinking can be applied to all branches of transportation.
I know that provincial governments in considering such things as bus transportation within the provinces have had to make a choice between private competition, public ownership and regulated private competition. The only method I think we can adopt as an assured guide for making sure that we do not have to subsidize is to make positive that we get efficiency, and one of the best regulators of efficiency is private competition.
We find that wherever the government steps in and regulates competition there is some risk of a lack of efficiency, or it may have to regulate competition by setting up a monopoly with an arrangement to regulate the price so that the people who are using the service will not be overcharged.
In the province of Alberta the bus operators come under the supervision of the vehicle highway traffic board. Each bus operator is given a franchise to a certain route, and rates on passengers and freight are strictly controlled and regulated. I think it should be pointed out that this is an entirely artificial method of finding costs. It is true that the government could look at the financial returns of a company and if it finds the company is making too much money there might be some basis for believing that the costs were too high. On the other hand, if the company is losing money it might be just as true to say the costs are too high because it is much too inefficient.
The only point I am striving to make is that effectively regulated enterprise is one of the best means of ensuring the saving of 

money which will cut down on subsidization, but with greater efficiency there will be less cost to the taxpayer.
I could touch for a moment on some of the difficulties which, even if the government decided it has a good method of figuring out costs, could be troublesome, especially when you have two different types of industry competing with each other. It is then very difficult to find out what are costs, how much is subsidy, and which industry is efficient. Of these I suggest the most obvious are the railroad and trucking industries.
In the north of Canada we have quite a bit of discussion as to whether or not aeroplanes can compete with barges. There are such factors to be considered as winter stockpiling, where a barge can haul a much greater load, but the value of your money is tied up in a year's inventory as compared with the initial cost of an airplane, the landing strip for it, the relatively high unit cost, but greater turnover of capital.
I suggest that if we are to adopt a national transportation policy all of these factors, as wide ranging as the size of an inventory which it is best for a merchant in Aklavik or Inuvik to keep on hand, the size of an aeroplane to be used to service the Yukon territory, whether it is better to use a barge on the Mackenzie river, all the way down to how much of a subsidy it is when a provincial government builds a highway for a truck to operate and really pay as compared with a railway, must be considered. It may be said, I suppose truthfully, by proponents of this resolution that the present subsidization is really a hit or miss affair or at best sort of a spotting of areas of trouble.
The object of the government, of course, is first to make sure that the service is supplied to the public. I would suggest that where the service is really needed and where people are given enough scope, private enterprise has enough ingenuity to find a way to give them that service at a reasonable cost and make a profit. I would therefore just like to add a note of caution; that we by all means try to avoid regulation which is going to discourage our private enterprise transportation people from giving us the benefit of their wisdom and experience and being able to take care of many of these problems which otherwise would be sloughed off on to eager government shoulders.


Edmund Leverett Morris: Mr. Speaker, I would like to deal, not as parliamentary secretary but as one of the Atlantic provinces 33 members of parliament, with one particular aspect of the motion before

the house. What is asked in the motion is a minimum degree of subsidization of competing forms of public transport.
We maritimers are understandably sensitive about transportation. We had historic pledges that our transportation services would be preserved to us and that, more particularly, the Intercolonial Railway would not be measured in economic terms alone. If it were to be measured in economic terms alone, it ought first of all to be taken up and relocated. The present Canadian National Railways route between Halifax and Montreal follows a course of scenic beauty, but none the less one which was intended to secure it far enough north to inhibit nocturnal raids by intransigent Yankees from New England. Consequently whenever it is suggested that transportation services be put on another basis, that they not be subsidized or that they be put on economic terms alone, maritimers are apt to be sensitive.
In the brief time permitted me in this debate I want to speak about that aspect which has to do with the recommendations of the MacPherson report. In so far as the Atlantic provinces are concerned, it is evident that the recommendations of the MacPherson royal commission, if implemented in whole or in substantial part, would have a very far reaching effect upon the economy of our region and upon our people.
The principal recommendations of the MacPherson royal commission in respect of the Atlantic provinces seem to me to be these. First, the report recommends that the 20 per cent Maritime Freight Rates Act subvention now paid on rail shipments moving within the Maritime Freight Rates Act territory- which is to say, the four Atlantic provinces and that part of the province of Quebec lying east of Levis and Diamond, south of the St. Lawrence river-be removed except in so far as it applies to, from and within Newfoundland.
The commission's rationale for recommending the removal of this inside assistance seems to be this, at least in part:
Business of the House
We are convinced that the development of the trucking industry in the provinces of Nova Scotia, New Brunswick and Prince Edward Island has now, in spite of the handicap, progressed to the point where the withdrawal of the subvention on intramaritime shipments will in general bring rail rates to a level which is favourable to the encouragement of traffic. The consequent shift of resources from rail to non-rail investment will be in response to demand for that service from shippers.
Continuing the quotation from the MacPherson report:
The commission is not unmindful of some of the disturbances in shipping patterns which may be created, should parliament decide to amend the Maritime Freight Rates Act by eliminating the payment of the 20 per cent subvention on shipments solely within select territory.
Mr. Speaker, time will not permit me to develop the theme which I wish to develop on this removal coupled with the recommendation that the outside subvention be sustained. This suggestion that the internal subvention of 20 per cent be now removed is one which is receiving the closest consideration of the maritime transportation commission, the governments, industry and all our people. The question which I asked the hon. member for Assiniboia (Mr. Argue) dwells with us; whether it might now be better to sustain this recommendation and remove that internal subvention and apply it as a new subvention, over and above the 30 per cent outside subvention, to the products of secondary industry in our region moving beyond the region.
Mr. Speaker, I see that it is six o'clock.



BUSINESS OF THE HOUSE

John Whitney Pickersgill: Mr. Speaker, I assume we are going on with the supplementary estimates tomorrow.


Mr. Churchill:: Yes, Mr. Speaker, and with rapidity and relevance.


John Whitney Pickersgill: The relevance I can assure the minister there will be from this side.


[Stage Direction]
At six o'clock the house adjourned, without question put, pursuant to standing order.
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[Stage Direction]
Thursday, March 29, 1962