1963-07-24

[Stage Direction]
Fifth report of standing committee on banking and commerce-Mr. Asselin (Notre Dame de Grace).

Hon. Mitchell Sharp (Minister of Trade and Commerce):: Mr. Speaker, I wish to make a statement about Canadian wheat board initial prices to producers for western wheat, oats and barley for the crop year beginning August 1, 1963. These are being fixed at $1.50 per bushel for No. 1 Manitoba northern, basis in store Fort William-Port Arthur or Vancouver; 60 cents per bushel for 2 C.W. oats, basis in store Fort William-Port Arthur; 96 cents per bushel for 3 C.W. six-row barley, basis in store Fort William-Port Arthur. These are the same levels as for these grades during the crop year which is now drawing to a close. Initial prices for other grades of western wheat, oats and barley will be announced later by the Canadian wheat board. Although the government takes full responsibility for the level of initial prices, under the Canadian Wheat Board Act the Canadian wheat board was, as is customary, asked to make its recommendations which were in accord with the government's decision.
Before reaching its decision on initial prices and on other aspects of the government's program which I shall refer to later, the government made a careful reassessment of the rapidly changing grain situation, and consulted not only with the Canadian wheat board but with a number of farm leaders from the prairies. Taking into consideration the stocks on hand, the record grain crop that appears likely to be produced on the prairies this year, the uncertainties created by the results of the United States farm referendum, and the negotiations now going on in Geneva under the auspices of GATT for new international arrangements for the marketing of cereals, the government came to the view that the initial prices should remain unchanged for the coming year. The government shares the opinion of major farm organizations that efforts should be concentrated on moving as much grain as possible.
There are two sides to this matter of our wheat marketing, supply and demand. Taking one year with another and a variation in yields which must be expected, we should aim to avoid the production of unmanageable surpluses and through appropriate crop diversification be in a position to meet changing domestic and foreign demand for wheat, coarse grains and livestock. Our production policies, including the various programs affecting wheat and other grains, must be designed to achieve these objectives. The government has initiated a review of these policies and programs to determine in what way they might be adjusted to achieve a better balance in agricultural production and the avoidance of burdensome surpluses. For example, the government considers that we should be in a better position than we are at present to meet the expected increase in demand for livestock and feed grains. On the demand side, the government is making every effort to help the wheat board to increase to the maximum commercial sales in markets throughout the world, wherever they are to be found.
The government has decided that the time has come to move forward on another front which should prove of both short run and long run advantage to western wheat producers. To help meet the food needs of the developing countries, Canada for many years now has been making wheat and flour available as part of our Colombo plan assistance. I wish to announce at this time the intention of the government to ask parliament to provide for a program of supplying wheat or wheat flour to international agencies, including the world food program, and to developing countries which are not now commercial markets or where commercial exports are limited by capacity to pay. Something can be done this year. The intention is on a progressive basis to increase the amount of Canadian food aid in appropriate relationship to the total of our assistance activities. It is expected that the total allocation for this purpose might rise to a level of around $40 million per annum over the course of the next few years.
The actual amount of wheat and flour to be made available for assistance purposes in the next crop year will depend on the needs of the world food program and the absorptive capacity of the developing countries we wish to assist. Safeguards will be introduced to ensure that the provision of additional Canadian wheat and flour does not interfere with
2560	HOUSE OF
Announcement of Initial Grain Prices the normal commercial marketings of Canada and other exporting countries whom we shall be consulting as appropriate. I am confident all members of the house will agree that food aid, in particular the provision of wheat and flour which we are so well placed to produce, should be a continuing and important part of our external development assistance programs as long as the need for food exists.
This enlarged program of food aid, in combination with the efforts that are being made to maintain and increase commercial sales, to gain access to import markets and to stabilize international trade at reasonable prices, seems to the government to represent the right approach to the problems that confront western grain producers under present circumstances. I feel confident it is an approach that will commend itself to western producers and to hon. members on all sides of the house.


Right Hon. J. G. Diefenbaker (Leader of the Opposition):: Mr. Speaker, as I listened to the unveiling of this plan I could not but recollect that when we were in office we were criticized for assistance by way of wheat, grain, flour and the like to needy countries. I, and all hon. members of this party, are very happy at the conversion of those in the Liberal party who previously held the very reverse of the opinion inherent in the announcement today.
It will be recalled that we gave strong support to the setting up of an international food bank in order to provide assistance and aid to needy countries, and at the same time to permit the setting aside of surpluses which otherwise would hang over the market price. Furthermore, we greatly expanded assistance under the Colombo plan to nations within the commonwealth. We increased this aid from $30 million to about $50 million. Last year, by reason of special circumstances, we reduced that amount, but it was still approximately $7J million or $10 million more than had been the case when we came into office.
The minister also made reference to the need to expand our markets, and we are also in accord with that. We recall so well that during the days of the previous Liberal government the then minister of trade and commerce stated "If they want our wheat let them come and get it." That was not the attitude of the government of which I had the honour to be head. We expanded our markets, and we are now glad to hear that the present government intends to follow in our footsteps and will make available the


necessary credits to those nations which because of their peculiar economic conditions would be unable to make the required purchases.
I have nothing to say in regard to the initial price. The ultimate determination as to whether what is being done is worth while so far as the farmer is concerned will await the final payment, which will indicate the actual price the farmer will be receiving. However, I am sure no one will be surprised when I express the view that the western farmer will be taken aback at the complete failure of the government to carry out one of its major agricultural promises-


Mr. Mandziuk:: Commitment.


John George Diefenbaker: -"commitment" is the word, whereby it undertook to pay $3 per bushel for the initial unit of 300 bushels. That seems to have joined the ranks of the forgotten promises, as well as the promise of a floor of $2 a bushel. It was singularly absent from the announcement made by the minister, and indicates that these two promises of $3 for the first 300 bushels and a $2 floor have joined the ranks of the forgotten promises of a few months ago.


Mr. H. A. Olson (Medicine Hat):: Mr. Speaker, we in this group welcome the announcement that has just been made by the Minister of Trade and Commerce respecting the initial prices to be paid for wheat, but I think that welcome will have to be confined to the fact that it was announced a little earlier this year than it was last year. It is exactly the same as it was last year and, as the Leader of the Opposition has just pointed out, it appears to be a major retreat from the promises that were held out to the western farmers, first of all for $3 a bushel on the initial quota; and in so far as the $2 a bushel is concerned, being the floor price that was promised, I suppose we will have to wait and see what the final payment will be before we pass judgment.
I hope that the efforts of the Canadian wheat board in selling wheat and wheat flour in the international market will be supported by the government in allowing the wheat board to be more competitive; that is, to offer more competitive terms, which I think all hon. members realize are necessary in the international wheat market today. Credit, of course, is one of the very important terms that must be offered if we are to be competitive. Of course there are other things as well that should be taken into consideration.
The minister pointed out that there is a need for balancing the production of farm products; that is, to try to shift some of the emphasis to livestock products, for which

he suggested there is a demand. I suggest to him that this may be well so until we reach the point where we have a surplus in this area of farm production also. While the beef industry particularly is the only part of farm production that is in a healthy position today, I suggest to him this is so because there has not been overproduction of this product. It seems to me it is rather important that we consider keeping a healthy industry healthy.
Regarding the matter of offering food in the form of wheat and wheat flour to countries as aid, I would say on behalf of this party that we welcome this program. We have suggested over the years that this is an area to which the Canadian government should really be paying a little more attention. I hope when they do make these offers they will take into consideration the depressed condition of the flour milling industry across Canada and perhaps put a little more emphasis on offering the product that is processed in Canada rather than the raw material, which has been the case in the past. I might also say in closing that we were a little perturbed about the cut made in the Colombo plan last year by the previous government. We are happy to see that the government is moving into this food aid program even though it may be in a different channel.


Mr. T. C. Douglas (Burnaby-Coquitlam):: Mr. Speaker, the prairie farmers generally will be disappointed at the announcement that has been made with reference to the initial price that is going to be paid on this year's crop. A former agricultural spokesman for the Liberal party used to describe such announcements as peanuts.


Mr. Woolliams:: That is right.


Some hon. Members:: Hear, hear.


Thomas Clement (Tommy) Douglas: Certainly that would be a very apt description of what is being proffered today. I would have hoped the minister would say something about the very definite commitment made to prairie farmers by the Prime Minister in his statement in Saskatoon on March 6 last. That commitment involved two things. It involved first of all a guaranteed payment of $2 a bushel for wheat, basis Fort William; it also involved a two price system for wheat under which the wheat consumed in Canada would be estimated on the equated price and the extra money would be paid to the farmers on their initial delivery quota.
The minister has made no mention of either of those commitments, nor has either the minister or the Prime Minister at any time said this is now accepted as part of the Liberal commitment and that if it is not going to be done now, it will be done in the
Announcement of Initial Grain Prices near future. The government has simply ignored its commitment, but I think it will not be allowed to forget it by the great bulk of the farmers of the prairie provinces.
With reference to the proposal that additional wheat and wheat flour should be given to emerging nations, I am sure this will have the support of the people of Canada. Certainly I can assure the government that it will have the support of the members of this party. At a time when we have surplus food in Canada one of the great weapons of democracy is to use this surplus food to help strengthen the emerging nations and help them in this period of transition through which they are now passing.
However, I do not think forty or fifty million dollars worth of wheat or wheat flour is going to solve our problems, and I hope the government will be giving some consideration to following the program which the United States has followed of making wheat available to countries who need it in exchange for foreign currency, or even on a barter basis, and certainly on a long term credit basis.
Unless this wheat can be moved it is going to create a very serious economic problem for the people of Canada. But the immediate problem, the problem to which I think the government ought to give its attention, is the price for the farmers. The bright promise which has been made by the government of a $2 a bushel guaranteed payment and a two price system is something to which we hope the government will give attention, and give assurance to the house that this will not be merely a forgotten promise.

On the orders of the day;


Mr. G. D. Clancy (Yorkion):: May I have your indulgence, Mr. Speaker, because of the fact I am not sure to whom I should address this question. Is there any truth in the rather substantial rumours in western Canada that the cash advances are going to be subjected to 4 per cent interest this year? Second, in so far as the announcement by the Minister of Trade and Commerce is concerned, can he assure us that the wheat board will be reimbursing the farmers by at least the price under the international wheat agreement for the wheat and flour that is given away?


Mitchell William Sharp: The answer to the first question is that there is no substance to the rumour.
The answer to the second question is that the wheat board sells for cash and, so far as I know, always at the same price for the same grade. The wheat that is given in aid
2562	HOUSE OF
Announcement of Initial Grain Prices or used for developmental assistance will, of course, be paid for at the going price at the time.


Eldon Mattison Woolliams: May
I ask a supplementary question concerning the initial price of wheat. The minister said he had consulted the leaders of western farm organizations. Were their suggestions in line with the prices he announced today for wheat, oats and barley?


Mitchell William Sharp: Some of them were.


Mr. G. H. Aiken (Parry Sound-Muskoka):: May I ask the Minister of Trade and Commerce whether the provisions concerning wheat flour which he announced today for the world food program are in addition to the commitment already made, or are they part of the original commitment?


Mitchell William Sharp: The statement I made was that I hoped we would build up our food assistance in the form of wheat and flour to a level of about $40 million a year.


Hon. Alvin Hamilton (Qu'Appelle):: May I
ask a supplementary question. In view of this strong shift to giveaways in connection with wheat and wheat flour, particularly under the world food program, will this be done at the expense of our previous commitment to provide dairy products?


Mitchell William Sharp: The short answer to the hon. member's question, Mr. Speaker, is no.


J. Nicholas (Nick) Mandziuk: Mr. Speaker, I wish to direct a question to the Minister of Trade and Commerce, who has given us a very disappointing announcement regarding the initial payment for wheat. My question arises out of the fact that he stated he was worried about the unmanageable surpluses. My question is, what surpluses did he have in mind, and what scheme would the government have in order to manage these surpluses; or is it like the old Liberal government of bygone days, where they paid-


Mr. Speaker:: Order.


J. Nicholas (Nick) Mandziuk: Where they paid for keeping the land out of crop.


Mr. Speaker:: Order. You have stated your question, let the minister answer.


Mitchell William Sharp: Mr. Speaker, I am not sure what the question was. I listened to a speech. However, I do suggest that when the farmers of western Canada know about the program I have announced today to extend more food aid to the needy countries of the world, and


thereby increase the markets for Canadian wheat and flour, they will not be disappointed.
I think the second part of the question had something to do with what I stated about unmanageable surpluses. What I had in mind was the possibility that if we do not follow appropriate policies we might have unmanageable surpluses.


Mr. Horner (Acadia):: Why didn't you think of that before the election?


Mitchell William Sharp: I say to the hon. member who has just interrupted, I do not think it helped greatly when the former minister suggested the farmers should grow all the wheat they could, and that he would sell it for them.


John (Jack) Henry Horner: And he would have, too.


J. Nicholas (Nick) Mandziuk: A supplementary question, Mr. Speaker. Might not the Minister of Trade and Commerce be well advised to get Alvin Hamilton to help him sell the wheat?


Eldon Mattison Woolliams: A supplementary question, Mr. Speaker-


Mr. Speaker:: Order. I think this is becoming in the nature of a debate. The hon. member for New Westminster.


Eldon Mattison Woolliams: Mr. Speaker, I would like to ask a supplementary question. It is not a question of debate. My supplementary question is briefly this-


Some hon. Members:: Order.


Eldon Mattison Woolliams: How many million bushels does the minister say his policy will help get rid of; how many million bushels will they export?


J. Nicholas (Nick) Mandziuk: None.



NATIONAL PARKS


Hon. Arthur Laing (Minister of Northern Affairs and National Resources):: Mr. Speaker, I wish to announce to the house the approval in principle by this government of the proposal of the government of Nova Scotia for the establishment of a new national park in Nova Scotia. This announcement is being made simultaneously by Hon. R. L. Stanfield, premier of Nova Scotia, for the government of Nova Scotia, and by myself and on behalf of my colleague the Minister of Labour for the government of Canada. At this time I want also to thank for their co-operation and assistance members of parliament from the province of Nova Scotia who sit both to your right and to your left.

The proposed national park is to be established at Kejimkujik lake in western Nova Scotia and becomes the first national park to be established since the creation of Terra Nova national park in Newfoundland in 1957. The proposed national park is 38 miles south of Annapolis Royal and 150 miles west of Halifax. It is considered to be an outstanding example of Nova Scotia's beauty of forest and sea. More than 20 lakes, some with excellent beach potential, and a number of connecting rivers are the heart of the park proposal. In addition to the lake area, a representative section of Nova Scotia's Atlantic shore line will be preserved as part of the new national park. Kejimkujik lake will be the site of the national park in Nova Scotia and the nineteenth national park in Canada. Cape Breton Highlands national park on Cape Breton island, Nova Scotia, was established in 1936.
On behalf of the people of Canada I wish to express our gratitude to the government of Nova Scotia for having made available, free from encumbrances, these scenic lands which will henceforward be dedicated to the people of Canada. Both this government and the government of Nova Scotia have proceeded as expeditiously as possible to settle the final details of the arrangements. We hope for a conclusion in the early months of this fall so that this important project can be placed in motion.
Hon. George C. Nowlan (Digby-Annapolis-
Kings): Mr. Speaker, I am sure the house will have been interested in the announcement just made by the minister, and that the members from Nova Scotia will have been delighted. He will understand, of course, from his reference to the name of Annapolis Royal that I have more than a mere academic interest in this matter. This is one of the decisions of the government of which I can fully approve. In fact this step may have been recommended by my colleague the former minister, and in that connection it adds to my interest.
This will be a great addition to the tourist industry of Nova Scotia. The selection is one which, sited as it is in an area in the southwestern part of the province, will have a great impact on various constituencies represented here, and one which the government of Nova Scotia have fully approved and recommended.
I commend the government for having proceeded in this way by bringing the proposal forward as soon as possible.



QUESTIONS

['1. In 1962 and 1963 in lake Superior, the experimental area, the number of adult marine lampreys was reduced by at least 80 per cent. With this reduction in numbers, wounding of lake trout has dropped, their availability-catch per given yardage of net-has increased and larger trout are appearing in the catches.\n2. The program is being carried out in accordance with the terms of the great lakes fishery convention between Canada and the United States. This convention remains in force until October 1965. The convention provides for a joint review in the eighth year of the activities of the commission appointed pursuant thereto to determine the desirability of continuing, modifying or terminating this convention. This review will be completed later this year.']
Mr. Pickersgill:: The following questions are being answered today: 472, 813, 837, 858, 916,
28902-5-163
Questions
925, 926, 936, 948, 951, 953, 961, 978, 980, 981, 984, 992, 993, 1026, 1029, 1030, 1033, 1037, 1038 and 1041.
I wonder if the following questions could be made orders for returns: 437, 816 and 950.
The following are additional questions for which returns are being tabled immediately: 869, 934, 937, 938, 939, 940, 941.
Would you please call starred questions nos. 912, 932, 955, 1042? The remaining questions stand.
(Questions answered orally are indicated by an asterisk.)



Mr. Fisher: 1.	How has the federal shipbuilding subsidy worked, by year, in providing more ships and employment, in terms of scale of subsidy, scale of private spending to get subsidy, type and size of vessel constructed, place of construction and estimated man-days employment?
2.	Has the maritime commission noted a trend to take less advantage of the subsidy and a preference of shipowners to buy old ships from foreign owners and, if so, what explanation does the commission have for this trend, with comments on what part the shipbuilding subsidy may play in this matter?
3.	Has the commission under consideration any recommendations to the government regarding the subsidy or its legislative basis and, if so, when does it estimate these considerations will be completed?


Mr. Mcllraiih:: 1. The following is a summary of vessels built and delivered and subsidy paid under the ship construction assistance regulations for the fiscal year 1961-62 and the fiscal year 1962-63: -
Fiscal Year 1961-1962
	Total	Subsidy
	Construction	Paid
	(in	(in
Area	dollars)	dollars)West coast	929,738	371,895Fiscal Year	' 1962-1963	Area	Total	SubsidyConstruction	PaidWest coast St. Lawrence gulf to	17,863,090	6,951,235east coast St. Lawrence river	8,033,462	3,315,136and interior	24,846,283	6,083,725Totals 1962-63 Types of Vessel	50,742,835 :	16,350,096
Of a total of 98 vessels built and delivered during fiscal year 1962-63, there were 12 fishing vessels other than trawlers, 6 trawlers, 19 tugs, 4 ferries, 4 tankers, 1 seaway bulk carrier, 5 coasters and 47 non-self propelled. During 1961-62, 10 non-self propelled vessels were built under the regulations.

Questions
With respect to employment, it is estimated that each one million dollars of ship construction provides 110 to 140 man years of work, taking into account both shipyard labour and labour in related industries.
2.	No.
3.	The Canadian maritime commission maintains a constant review of the subsidy program and of the ship construction and ship operating industries generally.


FREE TRADE WITH GREAT BRITAIN
Mr. Maiher: Is the government giving consideration to the standing offer by Great Britain of free trade with Canada?
Answer: 1. I am not aware of any standing offer by Great Britain of free trade with Canada. As I reported to the house on May 24 Britain, the United States, Canada and other GATT countries have agreed that comprehensive trade negotiations, to be conducted on a most favoured nation basis, are to begin in May 1964.
(Translation):
AIR TERMINALS, ROUYN AND VAL d'OR, QUE.

Question No. 837-Mr. Caoueile:
Has the government received any representations for the construction of air terminals at Rouyn and Val d'Or and, if so, what were the answers to these representations, and what action does the government intend to take in this matter?


George James McIlraith: Reprentation was made in September of last year to the department in regard to the provision of an air terminal building upon Val d'Or airport. The reply given to this representation made note that this airfield is a military establishment, and that any outlay of funds towards meeting civil aviation requirements upon the airfield must be undertaken in full cognizance of the overall objectives of the Department of National Defence and the Department of Transport. It was further noted that discussions were underway between the two departments in an examination of development planning of the civil aviation area.
The discussions on this matter between the Department of National Defence and the Department of Transport are continuing, and upon resolution, will leave the way clear to allow the planning and programming of new air terminal facilities.
There has been no representation received regarding air terminal requirements upon Rouyn airport.
(Text):
investment in price supported commodities


Mr. Mather: What is the total of federal investments in price-supported commodities?


John Whitney Pickersgill: At the close of the last fiscal year of March 31, 1963, the total of the federal investments in price supported commodities administered by the Department of Agriculture was one hundred and forty million, seven hundred and six thousand three hundred and eight dollars and sixty eight cents; by the Department of Fisheries, nil.


*PAROLE OF LEOPOLD DION
Mr. Marcoux: 1.	Who recommended the parole of Mr. Leopold Dion of Pont Rouge, Quebec, sentenced to life imprisonment in 1940?
2.	What were the reasons given in support of this parole?
3.	At the end of 1962 or the beginning of 1963, who recommended a new parole for the same man?
4.	What were the reasons advanced in support of this parole?
5.	Will a general investigation be made of the national parole board?


Mr. Macdonald:: As to questions 1, 2, 3 and 4 I must reply that it is not the policy to disclose information contained in parole files because of the confidential nature thereof. In order that the national parole board may receive as complete information as possible, both good and bad, from all possible sources, the policy is to regard all information and representations contained in such files as confidential. Nor is it the policy for the board to disclose the specific grounds of parole in an individual case.
In order, however, that hon. members may fully understand the situation, I should like to add the following.
Under the terms of the Parole Act the board, with exceptions which are not relevant here, "has exclusive jurisdiction and absolute discretion to grant, refuse to grant or revoke parole" (section 5). The act also provides that the board shall, at the times prescribed by the regulations, review the case of every inmate of a penitentiary serving a sentence of two years or more, "whether or not an application has been made by or on behalf of the inmate" (section 6). The regulations provide-as far as present purposes are concerned-that, in the case of an inmate serving a sentence of two years or more, the board shall review the case at least every two years.
Review of such cases by the board is therefore not dependant upon any representations being made to the board and any such representations, whether emanating from the inmate or his friends, are taken merely as indicating an active interest on his part in obtaining a parole.
Coming now to question No. 5 the answer is that no intention has been formed to direct a general investigation of the national parole board. I need hardly say with what horror

we all regard the deaths of the four boys in Quebec city, to which the question obviously relates, or what profound sympathy we feel for their families. I intend, however, to await the outcome of the police investigation and the inquests, and any subsequent court proceedings, before making any further comment on this tragic case, except to say that I made a point of examining the files of the national parole board and, whatever the merits of the decision to grant parole in this case, I find, as I had anticipated, that the case was considered painstakingly and in complete objectivity by the board.


GRANT OF $100,000 TO B.C. INDIANS
Mr. Howard;: Is the grant of $100,000 to provide for additional services to Indians of British Columbia earmarked for special purposes and, if so, what are those purposes?


Mr. Munro:: Yes. The promotion of agriculture and irrigation, as well as other programs designed to promote the economy of the Indians of British Columbia such as fishing, logging, hunting and trapping.
Since 1959 an Indian advisory committee, comprising three members selected by the Indians themselves and representative of the Indians of the coastal, northern and mainland portions of the province, has been advising and assisting the Indian commissioner for British Columbia in the planning and allocation of funds granted for the purpose.
(Translation):


YIELD ON GOVERNMENT BONDS
Mr. Marlineau: 1.	What was the average yield on ninety day government of Canada treasury bills for the period between July 3 and July 10?
2.	Was the average yield higher than it was during the previous corresponding period?
3.	What was the yield on 4 per cent government bonds due May 1964 during the period between July 3 and July 10?
4.	Was this an increase over the previous corresponding period?
5.	Has there been a general rise in interest rates during this period and, if so, (a) what is the reason for such a rise (b) is the government and/or the Bank of Canada taking any measures to stem any such rise in interest rates?


Mr. Gordon:: 1 and 2. The average yield on 91 day government of Canada treasury bills sold by auction at recent weekly tenders has been as follows:
July 11, 3.39 per cent per annum; July 4, 3.26 per cent per annum; June 27, 3.24 per cent per annum.
3 and 4. The yield on 4 per cent government of Canada bonds due May 1, 1964 on the basis of closing Wednesday mid-market quotations in recent weeks has been as follows:
28902-5-1631
Questions
July 10, 3.83 per cent per annum; July 3, 3.53 per cent per annum; June 26, 3.60 per cent per annum.
5. Market yields on government of Canada securities rose generally during the period between July 3 and July 10. Because of the variety and constantly changing character of influences operating in the market it is not possible to state precisely the reason or reasons for any given change in prices. The Bank of Canada's holdings of government of Canada securities increased by $28.4 million in the week ending July 10, and net purchases of such securities by the bank which had not yet been delivered to it amounted to $60.9 million on July 10 as compared with $1.0 million on July 3; these figures are taken from the "Weekly Financial Statistics" release published by the Bank of Canada.


GILBERT AYERS
Mr. Drouin: Is Mr. Gilbert Ayers employed by the Canadian National Railways and, if so (a) what is his position (b) when was he appointed (c) when does his term of appointment expire and (d) what is his annual salary?


George James McIlraith: No. A Mr. Gilbert Ernest Ayers, Lachute Mills, Quebec, was appointed a director of the Canadian National Railway company for a term of three years, effective October 1, 1961, at a salary of $5,000 per annum, by Order in Council P.C. 19611382 of September 27, 1961.
(Text):


*CASH ASSETS IN CONSOLIDATED REVENUE FUND
Mr. Cote (Chicoutimi): 1.	What is the total of cash assets in the consolidated revenue fund?
2.	What is the amount of "bank money" or of the credit created or issued by the chartered banks since 1954?


Walter Lockhart Gordon: 1. As of July 15 $565,401,180.22.
2. The chartered bank component of "Total currency outside banks and chartered bank deposits" which is usually used to measure the "total money supply" amounted to $8,856 million at the end of 1954 and $14,104 million at July 3, 1963.
These figures are published regularly by the Bank of Canada in its "Weekly Financial Statistics" and in its monthly "Statistical Summary".


INCOME TAX COLLECTED, MONTREAL, TORONTO, WINNIPEG, VANCOUVER
Mr. Basford: For the taxation year 1957-58 and subsequent taxation years, what percentage of total personal

Questions
Income tax paid was paid by the residents of Metropolitan Montreal, Toronto, Vancouver and
Winnipeg?


Mr. Garland:: The percentages of personal income tax and old age security tax assessed on residents of Montreal, Toronto, Vancouver
id Winnipeg for the years 1957 to				I960 are
; follows:				
	Taxation Year			
1957	1958	1959	1960%	%	%	%Montreal	14.07	13.69	13.24	13.50Toronto	18.98	20.06	18.30	18.59Vancouver	6.65	6.53	6.49	6.11Winnipeg	3.34	3.63	3.77	3.66SUMMERSIDE, P.E.I. LOBSTER	CARNIVAL	MILITARY	BANDS


Mr. MacLean (Queens): 1.	Has the Department of National Defence received requests for military bands to be present at the Summerside lobster carnival, July 15 to July 20, 1963, and, if so, what military bands have been requested?
2.	What military bands have been made available for this purpose?
Answer: 1. Yes, but no specific bands were requested.
2. The Canadian army and Royal Canadian Air Force bands were already committed for the dates involved, and although the Royal Canadian Navy band from H.M.C.S. Stadacona could have been made available for the 15 and 16 July provided the sponsor assumed the travelling cost involved, the sponsor declined this offer. However, arrangements were made for the Summerside voluntary brass reed band to participate in two parades.


MOTION PICTURE PRODUCTION
Nit. Thompson: 1.	How many original motion pictures were produced by the national film board in each of the years 1957-58, 1958-59, 1959-60, 1960-61, and 1961-62?
2.	In the same years, how many original motion pictures did the national film board contract out to private Canadian film production companies?
3.	Is it the purpose of the national film board, among other things "to promote the production and distribution of films designed to interpret Canada to Canadians and to other nations" and, if so, does the government intend to place a more reasonable proportion of government film production in the hands of private companies?


John Whitney Pickersgill: 1. 1957-58,	129; 1958-59,
104; 1959-60, 95;	1960-61, 83;	1961-62, 93.
		Revisions,
2. Originals		versions, etc,
1957-58	0	331958-59	1	51959-60	1	81960-61	1	31961-62	3	4
3. The board was established "to initiate and promote the production and distribution of films in the national interest-films designed to interpret Canada to Canadians and to other nations". The policy of the national film board is to operate at a level which permits economic utilization of its existing facilities. The board tenders out production work whenever the volume or schedule of production places a project outside the normal operating capacity of the board. The royal commission on government organization agreed with this policy as may be seen by its recommendation: "The national film board stabilize its film making at a level to provide economic utilization of present facilities".
(Translation) :


UNIVERSAL DAYLIGHT SAVING TIME
Mr. Marcoux: Is it the intention of the Department of Transport to urge Canadian railway companies to use daylight saving time instead of standard time in those areas where there is a difference between the two?


Mr. Cantin:: This would be a matter for consideration by the Railway Association of Canada and the hon. member's inquiry will be drawn to the attention of the association.


FEDERAL CONTRIBUTION TO BRIDGE, QUEBEC CITY
Mr. Marcoux: 1.	Is the Department of Public Works paying part of the cost of the new bridge between the city of Quebec and the south shore and, if so, what part of the cost is it paying?
2.	Does the Minister of Public Works intend to follow the recommendation of the mayor of Levis with regard to the site for the bridge?


Mr. Badanai:: Mr. Speaker, the answer is
as follows:
1.	No.
2.	Since this is a provincial project, the federal government has nothing to do whatsoever with the selection of the site.
(Text) :


H-BOMB EFFECTS
Mr. Douglas: What is the approximate or estimated effect, with regard to blast, burn, and immediate radioactive fall-out, of the following categories of H-bombs when exploded at 40,000 feet, 60,000 feet, 80,000 feet and 100,000 feet (a) 1 megaton (b) 2 megaton (c) 5 megaton (d) 10 megaton (e) 20 megaton (f) 100 megaton?
Answer: Blast: Using as a criterion the bodily removal of exterior wall panels of a frame house, which occurs at overpressure of 2 pounds per square inch, and which is classified as severe damage, the following are the distances from a point on the ground directly below the burst at which this severe damage will occur.

Height of
Burst-ft. 40,000 Yield of Weapon	60,000	80,000	100,000MT	Miles	Miles	Miles	Miles1	*	[DOT]	*	*2	1
5	7

10	11	6	*	*20	17	12	6	*100	35	35	25	20indicates that the overpressure ground does not reach 2 p.s.i.	on the
Immediate fall-out: For all the yields and heights specified, immediate radioactive fallout is negligible, because the fireball does not touch the ground, and the burst takes place above the regions of the atmosphere in which our weather is formed. For a 100MT explosion, there will be very little immediate fall-out for all heights above 18,000 feet.
Thermal radiation: Using as a criterion 8 calories per square centimeter, at which level human skin will suffer injury corresponding to severe sunburn with blistering, and light kindling materials will ignite, the following are the distances from a point on the ground directly below the burst at which this damage or injury will occur.
Height of
Burst- Yield of	[DOT]ft. 40,000 weapon	60,000	80,000	100,000MT	Miles	Miles	Miles	Miles1	32	8	2	[DOT]	*5	14	13	10	*10	20	20	20	2220	28	28	28	27100	63	63	64	64
^indicates that 8 cals per square centimeter is not reached on the ground.


BREAKWATER REPAIRS, WEST ADVOCATE, N.S.
Mr. Coates: 1.	Have repairs been completed to the breakwater at West Advocate, Nova Scotia?
2.	What is the estimated total cost of these repairs?


Hubert Badanai: 1. No, the work is about 70 per cent finished. It is expected to complete it later this summer.
2. $10,000.
Questions


FEDERAL BUILDING, AMHERST, N.S.
Mr. Coates: Are plans going forward on the construction of a new federal building in Amherst to replace the old federal building, and when is it expected that tenders will be called for this facility?


Hubert Badanai: The department is proceeding with studies to determine the exact nature of the accommodation required at Amherst and it is expected that new construction will be required probably in the 1965-66 fiscal year. However it has not been decided yet whether to erect a new building or to add to the existing building, known as the new federal building, or to do both.


FEDERAL BUILDING EXTENSION, AMHERST, N.S.
Mr. Coates: Is an extension planned to the new federal building in Amherst?


Hubert Badanai: See answer to question No. 980.


WHARF IMPROVEMENTS, JOGGINS, N.S.
Mr. Coates: 1.	Have representations been received for the improvement of wharfage facilities at Joggins, Nova Scotia?
2.	What are the names of individuals, associations, or concerns who have made representations for the improvement of these facilities?
3.	What action does the government plan to take, in this regard?


Hubert Badanai: 1. Yes.
2.	From Robert C. Coates, M.P. (Cumberland) who also forwarded copies of representations from Sifto salt division of Domtar Chemicals Ltd. and Enamel and Heating Products Ltd.
3.	No decision has yet been reached.


ARDA PROJECTS, ALBERTA
Mr. Horner (Acadia): What are the names of the projects in Alberta for which assistance has been asked, and granted, under ARDA by the federal government, and what is the total amount of assistance required for these projects?


Mr. Hays:: Three projects have been approved in the province of Alberta under the Agricultural Rehabilitation and Development Act. The projects, the total cost of each, and the amount of federal assistance is as follows:
Questions

Project
To develop marginal lands as the Seven Persons irrigated grazing reserve near
Medicine Hat	
To develop marginal lands as the Wanham
grazing reserve near Wanham	
To develop a soil capability inventory of agricultural lands in Alberta


TRANSFER TO CAPE BRETON OF &quot;SILVER DART&quot; REPLICA
Mr. Muir (Cape Breton: North and Victoria):
1.	Is the government prepared to arrange for the transfer of the replica of the Silver Dart which was displayed at the national aviation museum up until approximately three weeks ago (now stored in Hull, Quebec) to Cape Breton for permanent display?
2.	Is the government prepared to arrange for the transfer of any other replica of the Silver Dart for the above purpose?
Answer: The replica is a part of the collection of the national aviation museum housed in the national capital area. It has been donated to the national collection of aircraft. We know of no museum in Cape Breton, including the Alexander Graham Bell museum, which could house such a full scale replica on a permanent basis.
2. See 1.


LAMPREY CONTROL PROGRAM
Mr. Peters: 1.	Has the lamprey control program of the federal government been successful?
2.	How far north in Canada have lampreys been observed?
3.	Have lampreys infested any new areas in the past five years?
Answer: 1. From the information presently available a good degree of success is indicated. In 1962 and 1963 in lake Superior, the experimental area, the number of adult marine lampreys was reduced by at least 80 per cent.
2.	There are several species of lamprey one of which appears in Arctic waters. The sea lamprey-the great lakes predator-is found in waters tributary to the Atlantic ocean ranging from southern Labrador to Chesapeake bay.
3.	They have appeared in some streams tributary to lake Superior where they were not found five years ago. This is attributed to control measures in their original streams. While they may exist unnoticed in some other areas there has been no indication of major expansion into new areas.

Total	Federal
Cost	Assistance
$23,500	$11,750
14,000	7,000
18,500	18,500
$56,000	$37,250


WORLD FAIR GUIDE SERVICE
Mr. Peters: Is it the intention of the federal government to provide a guide service to assist visitors during the national centennial celebration similar to that supplied at the world's fair in Brussels and, if so (a) how many guides does the government intend to train (b) what will be the age limit of these guides and (c) is it the intention of the government to provide special uniforms and training for this purpose?


Mr. Lamonlagne:: I am informed by the national centennial administration that apart from meeting the needs which may occur in connection with specific projects, there is no intention at the moment of providing a guide service for visitors during the national centennial celebration.
The national centennial administration, however, does not speak for the Canadian World Exhibition Corporation.


BRUCELLOSIS CONTROL, TIMISKAMING DISTRICT
Mr. Peters: 1.	Is it the intention of the Department of Agriculture to establish a brucellosis-free area in the district of Timiskaming and, if so (a) when is it expected that the tests will be undertaken, and
(b)	at what date is it expected they can be completed?
2.	Is it the intention of the department to use federal veterinarians, or is it anticipated that local veterinarians can provide this service?


Harry William Hays: 1. It is the intention of the Department of Agriculture to establish a brucellosis-free area in the district of Timiskaming.
(a)	It is expected this area test will commence early in 1964.
(b)	The date of completion cannot accurately be predicted as progress will be dependant on the staff available and the extent to which private veterinary practitioners participate.
2. It is the intention of the Department of Agriculture to use some federal veterinarians, but all local veterinarians will be afforded the opportunity to participate in the program and will be offered employment by the department as casual veterinarians.


FALL-OUT SHELTERS, NORTH BAY
Mr. Peters: Has the emergency measures organization explored the possibility of providing fall-out shelters for those citizens resident in the expected point of contact north of the Bomarc missile base at North Bay and, if so, have the possibilities of fallout shelters using the abandoned mines at Cobalt and Kirkland Lake been assessed, and what mines, if any, have been found suitable for this use?


Mr. Drury:: As has been stated previously, there is no government program to build shelters for the public; however, various possible approaches are under study. In this context, the possible use of mines will be considered.
It will be recalled that, in 1962, the Department of Mines and Technical Surveys conducted, on behalf of the emergency measures organization, a survey of all active mines and some inactive mines of the adit type which were readily accessible and which might serve as fall-out shelters. The actual development of such mines as fall-out shelters would depend on each being studied separately to determine what additional features would be required to provide a safer environment. These features might include lighting, ventilation and, in some instances, pumping equipment. The survey did reveal that, at Cobalt and Kirkland Lake, there were underground workings which, if suitably
Questions
equipped, could serve as fall-out shelters for the population of these two communities.
As much of the information which was provided by mine owners was on a confidential basis, it is not possible at this time to name these mines.


FOREIGN OWNERSHIP OF COMPANIES
Mr. Lambert: 1.	Has a study been completed of the proposals referred to under the answer by the Minister of Trade and Commerce to question number 424 and. if not, when is a decision expected?
2.	Has the extent of foreign ownership among any of the proposing companies yet been determined and, if not, when is this information expected to be available?


Charles Mills (Bud) Drury: 1. Completion of the study is expected in the near future.
2. The extent of foreign ownership, if any, of any company whose proposal is accepted will be made known at the time of the announcement of the decision.


BUTTER PRODUCTION
Mr. Hamilton: 1.	What is the estimated production and consumption, by months, of dairy butter in dairy years (a) May 1, 1957 to May 1, 1963 (b) months since May 1, 1963 for which figures are available?
2.	What was the surplus of butter and butter oil as of May 1, 1957 and each May 1 in succeeding years to May 1, 1963?
Answer: 1 and 2. See attached statement.
1. (a) and (b) Estimated Production and Consumption of Dairy (Farm-Made) Butter, by months, May 1957 to May 1963 inclusive.
Dairy Years				
1957-58	1958-59	1959-60 1960-61 1961-62	1962-63	1963-64'000 lb.	'000 lb.	'000 lb.	'000 bl.	'000 lb.	'000 lb.	'000 lb.May	
1,148	1,074	917	829	763	663	454June	
1,202	1,092	964	842	735	670	July	
1,160	1,045	948	816	735	581	August	
1,142	1,027	938	802	718	570	September	
1,144	1,014	951	844	757	533	October	
1,127	1,046	947	849	752	526	November	
1,062	987	845	760	653	471	December	
904	908	810	688	583	503	January	
869	788	757	635	542	486	February	
799	769	738	590	530	361	March	
898	790	815	658	570	384	April	
1,018	865	787	705	592	416	2. Stocks of butter and	butter oil, May 1, 1957 to 1963.	May 1,	May 1,	May 1,	May 1,	May 1,	May 1,	May 1,1957	1958	1959	I960	1961	1962	1963'000 lb.	'000 lb.	'000 lb.	'000 lb.	'000 lb.	'000 lb.	'000 lb.Butter	
36,927	35,416	62,375	80,599	85,602	81,860	101,480Butter oil	
-	-	-	104	24,889	82,202	81,818
Orders for Returns


ACCESS TO BALLAST GROUNDS, NORTH SYDNEY, N.S.
Mr. Muir (Cape Breton: North and Victoria):
What progress is being made in the negotiations between the Department of Public Works and owners of the properties concerned regarding an access road to the ballast grounds at North Sydney, Nova Scotia, for the purpose of eliminating the inconvenience caused to fishermen?


Hubert Badanai: The department has received an offer to sell property that would provide access to the ballast grounds and an independent appraisal of the fair market value of the land is now being made. Negotiations will continue when the results of the appraisal have been received.


* LAMPREY EEL PROGRAM, GREAT LAKES
Mr. Nixon: 1.	What success has been achieved by the government program for the extermination of lamprey in the great lakes?
2.	Does the federal government intend to continue this program and, if so, could the Minister of Fisheries bring the house up to date on its present operation?


Mr. Robichaud:: 1. In 1962 and 1963 in lake Superior, the experimental area, the number of adult marine lampreys was reduced by at least 80 per cent. With this reduction in numbers, wounding of lake trout has dropped, their availability-catch per given yardage of net-has increased and larger trout are appearing in the catches.
2. The program is being carried out in accordance with the terms of the great lakes fishery convention between Canada and the United States. This convention remains in force until October 1965. The convention provides for a joint review in the eighth year of the activities of the commission appointed pursuant thereto to determine the desirability of continuing, modifying or terminating this convention. This review will be completed later this year.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. More: 1.	(a) What are the amounts paid by the government of Canada to the province of Saskatchewan in conditional grants in each of the years 1953-1962 inclusive (b) what were the specific programs and what was the amount of expenditure under each
(c)	what was the total amount for the period 1953-1957 inclusive (d) what was the total amount for the period 1958-1962 inclusive?
2.	(a) What were the amounts paid by the government of Canada to the province of Saskatchewan in unconditional grants in each of the years 19531962 inclusive (b) what was the total amount for the period 1953-1957 inclusive (c) what was the total amount for the period 1958-1962 inclusive?

3.	(a) What were the amounts of federal capital
expenditures and grants made to the city of Regina in each of the years 1953-1957 inclusive (b) for what purpose, and under what program, and in what amounts were expenditures under (a) made (c) what were the amounts of federal capital expenditures and grants made to the city of Regina in each of the years 1958-1962 inclusive (d) for what purpose, and under what program, and in what amounts were expenditures under (c) made?


* PROTEST AGAINST SALES TAX ON BUILDING MATERIALS
Mr. Mariineau: 1.	Has the Minister of Finance received any protests and/or representations in regard to the withdrawal of the exemption of the 11 per cent sales tax in regard to building materials and production equipment and machinery and, if so, what is the number of persons, associations, corporations or other bodies that have voiced such protests or made such representations, giving in each case their names or description?
2.	Have such persons, associations, corporations or other bodies informed the minister of any building, construction or other project which may be cancelled, postponed or set aside because of the proposed withdrawal of exemption of the said sales tax and, if so, what is (a) the total number of such projects (b) the total value thereof (c) the total number of jobs that may be involved by such proposed cancellation or postponement?


TARIFF ON BOOKS
Mr. Harley: 1.	What is the tariff rate on books?
2.	In the year 1962, what revenue did this tariff yield the government?
3.	What is the purpose of such tariff?
4.	Is there any consideration being given to changing the tariff on books?
5.	What is the value of total book sales in Canada for 1962?
6.	How many people are employed by book publishers, printers, and binders?
7.	How many original works were published in Canada in 1961, and 1962?


AIRCRAFT CRASHES IN CANADA
Mr. Fisher: 1.	Has the Department of Transport a record of all aircraft crashes in Canada and, if so, how many crashes have occurred in each year since 1959, including the first six months of 1963?
2.	In investigating the reasons for crashes, has the department found that any have been caused by aircraft hitting cables and wires and, if so, what accidents, where, involving what persons and planes, to what cost in lives and damage?
Return tabled.


PENSIONS OF ARMED FORCES PERSONNEL
Mr. Knowles: 1.	What is the average annual pension being paid, by rank, to permanent armed forces personnel retired in 1947?
2.	What is the average annual pension being paid, by rank, to permanent armed forces personnel retired in 1962?
3.	Have any adjustments been made, since they were retired, in the pensions of permanent armed forces personnel retired in 1947 and, if not, is

consideration being given to such adjustments in the case of those retired (a) in 1947 or earlier (b) since 1947 and prior to 1962?
Return tabled.


NATIONAL CENTENNIAL ADMINISTRATION
Mr. Basford: With regard to the national centennial administration, to date (a) how many board of directors meetings have been held (b) on what dates were these meetings held (c) which directors, if any, were absent from any such meetings (d) if any directors were absent from any such meetings, what were the reasons for their absence (e) who are the members of the executive committee (f) how many executive committee meetings have been held (g) on what dates were these meetings held (h) which members, if any, were absent from any meetings of the executive committee (i) if any members were absent, what were the reasons for their absence?
Return tabled.


GRANTS BY CENTENNIAL ADMINISTRATION
Mr. Basford: With regard to the allocation of grants by the national centennial administration (a) to date, what applications have been received, and what is the amount of the grant applied for in each case (b) to date, what applications have been approved, and what is the amount approved in each case (c) when was the "first come, first served" policy of distribution of centennial grants established (d) what is the commencement date for the operation of this policy (e) apart from the seven principles set out in appendix I of the annual report of national centennial administration 62/63, will any other principles apply and, if so, what are they (f) will any effort be made to evaluate one local centennial project by comparing it with other local centennial projects?
Return tabled.



CENTENNIAL ADMINISTRATION


Mr. Basford: With regard to the national centennial administration (a) how many provincial governments, and which ones, have established acceptable machinery for the processing and approval of local centennial projects (b) what efforts are being made to encourage provincial governments to establish such machinery (c) when was the last meeting with representatives of the government of British Columbia for the purpose of establishing such machinery
(d)	when is the next meeting for such purpose scheduled (e) if no such meeting is scheduled, is there any reason for not holding such meetings?
Return tabled.




Mr. Basford: Has the city of Vancouver made formal application to the national centennial administration for a centennial grant and, if so (a) for what purpose (b) at how many, and which meetings of the board of directors has this application been discussed (c) at how many, and which meetings of the executive committee has this application been discussed 28902-5-164
Motions for Papers
(d)	what is the present status of this application
(e)	does this application presently comply with the seven requirements set out in schedule I of the annual report 62/63 and, if not, which of the said seven requirements does the application not comply with?
Return tabled.



LOCAL CENTENNIAL COMMITTEES

Mr. Basford: With regard to the national centennial administration (a) how many local centennial committees have been established in Canada (b) how many local centennial committees have been established in British Columbia (c) if the answer to either part (a) or part (b) is unknown, are such figures collected (d) what efforts are being made to establish local centennial committees (e) have any brochures, pamphlets or other informational material (apart from copies of speeches) been prepared for the guidance of citizens or citizens' groups wishing to (i) apply for centennial grants (ii) commemorate our centennial (f) if the answer to part (e) is in the negative, is the preparation of such material being considered and, if so, when may such material be expected to be available?
Return tabled.



MOTIONS FOR PAPERS

[Stage Direction]
(Translation):

[Stage Direction]
"manege militaire"
Motion No. 50-Mr. Langlois:
That an order of the house do issue for a copy of all telegrams, letters and other correspondence exchanged between different members of the Canadian Army staffs and the Minister of National Defence, the Minister of Defence Production, and their assistants, concerning the construction of the future "Manage Militaire" of Thetford Mines, P.Q.
Mr. Cardin:: Mr. Speaker, I got in touch with the hon. member for Megantic and, since we are to meet about that motion, he has agreed to withdraw it.
Motion withdrawn.
(Text):



GLASSCO COMMISSION STUDIES RESPECTING C.B.C.

[Stage Direction]
Motion No. 52-Mr. Douglas:
That an humble address be presented to His Excellency praying that he will cause to be laid before this house a copy of all studies done by the Glassco commission in respect of the Canadian Broadcasting Corporation.
Maurice Lamontagne: I thought we had agreed that this motion would be withdrawn.


Thomas Clement (Tommy) Douglas: I would ask leave to have the motion withdrawn.
Order discharged and motion withdrawn.



EDMONTON MUNICIPAL AIRPORT

[Stage Direction]
Motion No. 55-Mr. Lambert:
That an humble address be presented to His Excellency praying that he will cause to be laid before this house a copy of all telegrams, correspondence, reports, briefs and memoranda, and any replies thereto, received by the Minister of Transport or any minister of the government or
[Stage Direction]
Motions for Papers
any government official, from the city of Edmonton, the Edmonton municipal airport authorities, or any other interested parties since January 1, 1954, to date, relative to the continued use and development of the Edmonton municipal airport.
George James McIlraith: There is no objection to this motion, subject to the usual reservation as to privileged or confidential material.


Mr. Speaker:: Is there any objection to the reservation as stated by the minister?


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.

[Stage Direction]
Motion No. 57-Mr. Mariineau:
That an humble address be presented to His Excellency praying that he will cause to be laid before this house a copy of the censure motion adopted by the Quebec legislative assembly on June 26, 1963, sent to the Prime Minister on July 11, 1963, as well as a copy of the covering letter.
Motion agreed to.

[Stage Direction]
Motion No. 60-Mr. Leboe:
That an order of the house do issue for copies of all correspondence exchanged, since June 1, 1962 between Coal Harbour Investments Limited (Vancouver), the city of Vancouver and the federal government concerning public works at Coal Harbour, B.C.
George James McIlraith: In the terms of this motion as presented there is no correspondence available. I wonder, therefore, if the hon. member would drop his motion. There is information available on a related subject. I have spoken with the hon. member about it and perhaps he would care to put forward a new motion for consideration.


Mr. Leboe:: That is satisfactory.
Motion dropped.



CANADIAN CENTENNIAL-CORRESPONDENCE WITH B.C.

[Stage Direction]
Motion No. 61-Mr. Basford:
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, telegrams, documents or notes, exchanged between the government, the President of the Privy Council, any member of the staff of the privy council office, the commisioner or deputy commissioner of the national centennial administration or any employees thereof, and the government of the province of British Columbia, concerning the centennial of Canada's confederation.
Maurice Lamontagne: Mr. Speaker, this motion is acceptable to the government subject to obtaining the consent of the government of British Columbia.


Mr. Speaker:: Subject to the reservation stated by the minister, is the motion agreed to?


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.

[Stage Direction]
Motion No. 62-Mr. Barnell:
That an humble address be presented to His Excellency for a copy of the cabinet minute or other official document which authorized the Secretary of State for External Affairs to notify the executive director, the international north Pacific fisheries commission, by telegram under date of May 10, 1963, that the commission's recommendations for the removal of the halibut stocks in the Eastern Bering Sea and the herring stocks west of the Queen Charlotte Islands from the annex to the convention had been accepted by the government of Canada.
He said:	Mr. Speaker, the minister has
spoken to me about this motion, and I would ask that it be allowed to stand until next week.
Motion stands.

[Stage Direction]
Motion No. 63-Mr. Basford:
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, documents or letters (not previously laid before this house) exchanged between the government, the Minister of National Defence, employees of the said department, and the city of Vancouver or any branch or board thereof, relative to that portion of R.C.A.F. station, Vancouver, Kitsilano site, most recently leased to the city of Vancouver.
Motion agreed to.

[Stage Direction]
Motion No. 64-Mr. Nielsen:
That an humble address be presented to His Excellency praying that he will cause to be laid before this house a copy of all documents, reports, engineering or other surveys, communications, correspondence or other papers, with respect to the (a) all weather maintenance of the road from Haines Junction in the Yukon Territory to Haines in the state of Alaska, U.S.A. (b) existing maintenance costs of the northwest highway system in maintaining the said road by the northwest highway system of the Canadian army and (c) paving of the said road.
Mr. Speaker:: I understand that the hon. member for the Northwest Territories is standing in for the hon. member for the Yukon. Is it agreed?


John Whitney Pickersgill: Mr. Speaker, in the circumstances perhaps these motions could stand until the hon. member is here.


Mr. Speaker:: The three motions in the name of the hon. member for the Yukon will stand.
Motions stand.



UNEMPLOYMENT INSURANCE BENEFITS TO CANADIANS IN U.S.

[Stage Direction]
Motion No. 67-Mr. Perron:
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 and documents exchanged between the government of Canada or any of its agencies and American states and/or of minutes of proceedings of the meetings held between representatives of Canada or any of its accredited agencies and representatives of any other government in connection with the extension of unemployment insurance benefits to Canadians working in these American states.
Mr. MacEachen:: Mr. Speaker, I understand that my parliamentary secretary has had discussions with the hon. gentleman with respect to this motion. Subject to securing the consent of the state of Maine and confining the motion to that state, it is acceptable.


[Stage Direction]
Motion agreed to.
CORRESPONDENCE RESPECTING U.S. EXCISE TAX Motion No. 68-Mr. Marlineau:
That an humble address be presented to His Excellency praying that he will cause to be laid before this house copies of all correspondence, telegrams, letters and other documents exchanged between the governments of Canada and the United States, or between officials of the said governments, relating to the new excise tax on the purchase by United States residents of Canadian securities and those of 21 other countries proposed by President Kennedy on July 18, 1963.
Mr.   Marlin@Essex East: Mr. Speaker, the hon. gentleman and I have discussed this matter and he has kindly agreed to let the motion stand.


Mr. Marlineau:: Mr. Speaker, in view of the fluidity of the situation I can understand the government's request, and I consent.


Mr.   Marlin@Essex East: I don't know what that means.


Mr. Pearson:: It does not mean anything.
Motion stands.



WINTER WORKS INCENTIVE PROGRAM

[Stage Direction]
Motion No. 69-Mr. Slarr:
That an order of the house do issue for copies of all correspondence and telegrams received by the Minister of Labour or any official of the Department of Labour in respect to the municipal winter works incentive program between April 22, 1963, and July 22, 1963.
Allan Joseph MacEachen: Mr. Speaker, this motion is acceptable subject to securing the consent of the provincial governments.
28902-5-1641
Motions for Papers


Mr. Speaker:: Is there any objection to the reservation stated by the minister?


Some hon. Members:: Agreed.


[Stage Direction]
Motion agreed to.
(Translation):

[Stage Direction]
Motion No. 70-Mr. Marcoux:
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, letters and other documents exchanged between the Department of External Affairs or any other department and the Holy See or any of its representatives, from October 14, 1957, to July 15, 1963, concerning the establishment of Canadian representation to the Vatican.
Mr. Martin (Essex East):: Mr. Speaker, in principle, according to our rules, that question is out of order. Be that as it may, I wish to say that, to my knowledge, no letters or other documents were exchanged between the Department of External Affairs or any other department of the government and the Holy See or any of its representatives, from October 14, 1957 to July 15, 1963, concerning the establishment of Canadian representation to the Vatican.
(Text):


Mr. Speaker:: The motion is withdrawn.
Order discharged and motion withdrawn. (Translation):



BRIDGE BETWEEN QUEBEC CITY AND SOUTH SHORE

[Stage Direction]
Motion No. 71-Mr. Marcoux:
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, letters, telegrams and other documents exchanged between the Department of Public Works or any other department and the government of the province of Quebec, between April 22, 1963, and July 19, 1963, concerning the construction of a bridge between the Quebec city and the south shore of the St. Lawrence river.
Mr. Deschalelels:: Mr. Speaker, there would be no objection to producing all correspondence, letters or telegrams requested by the hon. member except that, to my knowledge, no such documents exist. Therefore, I would ask the hon. member to be so kind as to withdraw his motion.


Mr. Speaker:: The motion is withdrawn. (Text):



C.B.C. TELEVISION STATION, QUEBEC CITY

[Stage Direction]
Motion No. 72-Mr. Marcoux:
That an order of the house do issue for a copy of all correspondence, letters, telegrams and other documents exchanged between the Department of the Secretary of State or any other department and the Canadian Broadcasting Corporation, from April
[Stage Direction]
Inquiries of the Ministry 22, 1963 to July 15, 1963, in order to speed up the establishment of a C.B.C. television station in Quebec city.
John Whitney Pickersgill: Mr. Speaker, it has always been considered that correspondence between a minister or the government and the Canadian Broadcasting Corporation is privileged, and such motions are not complied with. If the hon. gentleman would prefer to have the motion stand that would be agreeable, but if not I wonder whether he would consider withdrawing it.


Mr. Marcoux:: If it is impossible to have any information I will withdraw the motion.


Mr. Speaker:: Withdrawn.


John Whitney Pickersgill: I thank the hon. gentleman.
Order discharged and motion withdrawn.



CONSTRUCTION OF RAILWAY BETWEEN MATANE AND STE. ANNE DES MONTS, QUE.

[Stage Direction]
Motion No. 73-Mr. Marcoux:
That an order of the house do issue for a copy of all correspondence, letters, telegrams and other documents exchanged between the Department of Transport or any other department and the Canadian National Railways between April 22, 1963 and July 19, 1963, relating to the construction and the operation of a line of railway in the province of Quebec between Matane and Ste. Anne des Monts, as provided in chap. 13 of the statutes of Canada, 1962.
George James McIlraith: Mr. Speaker, it will be seen that this motion relates to correspondence between departments of the government and the Canadian National Railways, and such correspondence has always been considered privileged in the same way as correspondence between departments. In the circumstances I would ask the hon. member to withdraw his motion.


Mr. Speaker:: Withdrawn.
Order discharged and motion withdrawn.



FINANCE


[Stage Direction]
On the orders of the day:
John George Diefenbaker: Mr. Speaker, I wish to make further reference to a question I asked the Minister of Finance yesterday regarding an alleged agreement entered into between the governments of the United States and Canada for Canada to accept lower interest rates in return for certain changes to be suggested to congress by the President. In view of the fact that newspaper headlines read "Dillon Says One Thing, Gordon Says Another", has the minister anything further to say by way of

clarification in order to bring about some degree of certainty in this regard?


Walter Lockhart Gordon: Mr. Speaker, I would refer the right hon. gentleman to the joint communique issued at 6 p.m. on Sunday in Washington and Ottawa by the representatives of both the Canadian and American governments. That contains the only understandings and agreements that were entered into, and the right hon. gentleman will see that it makes no reference to Canada reducing interest rates. What we were trying to do was to prevent them going up.


John George Diefenbaker: Mr. Speaker, with further reference to the same matter, was there any agreement between United States and Canadian officials whereby Canada undertook not to use any exemption or alteration in the general policy of the United States to build up its foreign exchange reserves?


Walter Lockhart Gordon: Mr. Speaker, that is clearly set out in the communique. I do not think there is anything I can add except to suggest that people refer to the communique in which that particular subject is dealt with.


John George Diefenbaker: Does the minister think Mr. Dillon-


Some hon. Members:: Order.


John George Diefenbaker: -has not read the communique?


Walter Lockhart Gordon: Mr. Speaker, Canada has had the most co-operative and helpful consideration from Mr. Dillon, and I just hope nobody will see fit to criticize him for giving up his week end to get us out of this trouble.


Hon. George C. Nowlan (Digby-Annapolis-Kings):: A supplementary question, Mr. Speaker. I agree with everything the minister said about Mr. Dillon and his part in the conference that took place over the week end, but would the minister reconcile the evidence given by Mr. Dillon before a Senate committee with the official communique issued on Sunday?


Walter Lockhart Gordon: I do not think I have anything more to add.


George Clyde Nowlan: I do not think you can. [Later:]


Mr. Colin Cameron (Nanaimo-Cowichan-The Islands):: May I ask the Minister of Finance to tell the house if it is his understanding that the exemption from the United States tax on the purchase of Canadian securities arranged over the week end is dependant upon the Canadian government

being able to effect the modest decline in interest rates suggested in Mr. Dillon's reported statement?


Walter Lockhart Gordon: Mr. Speaker, there is no connection between the two. As I said yesterday, I am afraid I do not know what Mr. Dillon said or what the context of his statement was. As I have also said, there were no undertakings by the Canadian representatives other than those set forth in the communique.


Colin Cameron: Mr. Speaker, I have a supplementary question to bring the Minister of Finance back to the question I asked him. Are we to understand the minister is informing the house that this is an incorrect report from Washington, where Mr. Dillon is reported as saying that they-speaking of the Canadian government-felt that by a modest decrease in their interest rate "they could reduce the incentive to borrow in the United States. That was more or less the arrangement arrived at." Are we to understand that was an incorrect report?


Walter Lockhart Gordon: I am not going to comment on the correctness or incorrectness of the report. What I have said was that there was no such undertaking given.


Paul Raymond Martineau: As a further supplementary question, Mr. Speaker, I would like to ask the minister whether in fact the government is moving to lower interest rates in Canada.


Walter Lockhart Gordon: Well, Mr. Speaker, the monetary policy that has been followed by the Bank of Canada in recent months has been designed to provide the amount of credit needed to expand the economy.


Paul Raymond Martineau: Has there been any change in that policy since the week end?


Thomas Clement (Tommy) Douglas: Did the governor of the Bank of Canada give any such undertaking, when he was in Washington over the week end to the effect that Canada would lower its interest rate if the United States government were prepared to exempt us from the foreign exchange tax?


Walter Lockhart Gordon: Mr. Speaker, the governor of ,he Bank of Canada has informed me categorically that he gave no such undertaking.



SPECIAL ASSISTANTS-CERTIFICATE OF DEPUTY MINISTER

[Stage Direction]
On the orders of the day:
Walter Lockhart Gordon: May I reply to a question that was asked me on Monday by the hon. member for Winnipeg North Centre, Mr. Speaker. He
Inquiries of the Ministry asked whether the deputy minister of finance had certified payment for the special assistants who were attached to the Department of Finance during the first two months of this parliament.


Mr. Knowles:: The first days.


Walter Lockhart Gordon: I do not remember that being included in the question, Mr. Speaker. In reply I can assure the hon. member that before payments were made to the special assistants the necessary certification was signed by the departmental officer authorized by the minister to sign such certification as required by section 32 of the Financial Administration Act.
I would remind him that this section provides that-
-the deputy of the appropriate minister or other officer authorized by such minister-
-must certify that the work has been performed.
In the case in question, certification that the work was performed was given by officers of the department authorized by the minister to perform such tasks.



EXTERNAL AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. R. N. Thompson (Red Deer):: I should like to direct my question to the Secretary of State for External Affairs. In view of the progress that has been made in the test ban talks during the last few days, and in the light of the fact that Secretary of State Rusk has held briefing sessions with the members of congress, is there not some information or report that the minister might have for this house?


Paul Joseph James Martin: Mr. Speaker, the hon. gentleman will recall that during the past ten days there have been a number of questions on this subject, one by the hon. member for Medicine Hat last week. I indicated the general attitude of the government of Canada toward talks in which we were not a direct participant but about which we have, as every member in this house has an understandably vital interest. These talks are taking place among the United Kingdom, the United States and the Soviet union. Canada is not a participant in these talks which have to do with a proposed agreement with regard to certain aspects of nuclear testing; neither is France, nor are other countries of the international community.
When agreement is reached among the three participants there will be an opportunity to evaluate the effect of the agreement.

Inquiries of the Ministry Its implications will be discussed in the council of NATO. Canada has already, as I have previously intimated, given an outline of its views with regard to the desirability of a complete or partial nuclear test ban. Until such time as we have a full statement I can say no more than I have already. We believe it would be in the interests of the peace of the world that there should be a nuclear test ban. We hope it may go beyond the three areas mentioned and we will follow with interest any other proposals which have to do with the current discussions.


Thomas Clement (Tommy) Douglas: May I ask a supplementary question. In the light of the statement the minister has just made about Canada supporting a test ban agreement and expressing the hope that there may be an early agreement, does he consider that the Canadian government might give some leadership in this matter by revising its policy in regard to acquiring nuclear arms for Canada?


Paul Joseph James Martin: The hon. gentleman has already asked that question and has received a rather effective answer.


Horace Andrew (Bud) Olson: I should like to ask the Secretary of State, in view of his reply and the tremendous importance of this test ban treaty to Canada, and in view of the fact that a press report says that Mr. Rusk had a draft test ban agreement that he presented to the senate, whether Canada had a copy of the draft treaty at which the government could look.


Paul Joseph James Martin: We would not be one of the original signatories of a test ban treaty which we hope will eventuate, but Canada has, as my hon. friend knows, exhibited great interest in the matter. We have made our views known. We have reason to believe that the views we have stated are being carefully considered by the interested parties.


CANADIAN MEMBERSHIP IN ORGANIZATION OF AMERICAN STATES
[Stage Direction]
On the orders of the day:
John George Diefenbaker: Mr. Speaker, I wish to address a question to the Secretary of State for External Affairs which has to do with an article in Sunday's New York Times in reference to the organization of American states and Canada's membership therein. I wish to ask the minister, first, whether there has been any urging on the part of the United States for Canada to join this organization; and second, whether this brief statement made in the article is correct, that

Mr. Martin-that is the minister-was reported to have indicated that active consideration to join the organization of American states would be given only after the organization has decided to accept Jamaica, Tobago and Trinidad as members?


Hon. Paul  Marlin@Secretary of State for External Affairs: Mr. Speaker, I have had my attention drawn to this particular item, and I can say that I do not know the basis for it, because there has been no statement given by me in public that would warrant such a conclusion.


John George Diefenbaker: Was there any such
statement made to the secretary general of the organization of American states to that effect when he was here?


Mr.   Marlin@Essex Easi: Mr. Speaker, the other day I was asked a question about this and I indicated that it was not the custom to disclose the nature of conversations between an ambassador and a foreign minister.


John George Diefenbaker: Then what consideration is the government giving now, if any, to joining; and has there been any discussion with the United States department of state in this regard?


Mr.   Marlin@Essex East: Mr. Speaker, there has been no discussion with the state department in the United States. As I indicated early in the session, this matter, along with others, continues to receive serious consideration.


HONG KONG
[Stage Direction]
On the orders of the day:
Hon. W. G. Dinsdale (Brandon-Souris):: Mr. Speaker, I have a question for the Secretary of State for External Affairs. In view of the statement made by the Minister of Trade and Commerce on emergency food aid, has the government now decided to continue the program of emergency food assistance to Hong Kong which was inaugurated by the former administration, rather than discontinuing it, as he indicated in reply to a question the other day?


Hon. Paul  Marlin@Secretary of Slale for External Affairs: Mr. Speaker, I hope to be able to say something in answer to this question, and a related question, at a later date.


ASSISTANCE BY CANADA TO UNDERDEVELOPED COUNTRIES
[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, may I direct a question to the Prime Minister. In view of the report

on the C.B.C. news at eight o'clock this morning that Canada is at the bottom of the list of western industrial countries in terms of contributions to underdeveloped nations, can the right hon. gentleman say what Canada is doing in response to representations that we should increase the aid we are providing in this direction?


Lester Bowles Pearson: I can tell the hon. member what 1 am doing. I am checking the accuracy of those statistics.


LABOUR RELATIONS
[Stage Direction]
On the orders of the day:
Hon. Michael Starr (Ontario):: I should like to ask the Minister of Labour, in view of the latest outburst from Mr. Banks of the S.I.U., whether the government is willing to take positive action on the Norris commission report before this session recesses.


Allan Joseph MacEachen: As I indicated to the house yesterday, the findings of the Norris commission are receiving most urgent consideration, and when it is possible to bring proposals before the government, that will be the time to determine whether action can be taken within the time limit suggested by my hon. friend.


NORRIS REPORT
[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kooienay West):: Mr. Speaker, as a farmer, a some time employer and an old time trade unionist, I wish to address a question to the Secretary of State. In view of the fact that persons other than members of parliament have been interviewed on the C.B.C. program "Viewpoint" with respect to the Norris report, and in view of the fact that there are members of parliament who would welcome a similar opportunity, with equal time, including the hon. member for Kootenay West, would the minister inform the C.B.C. of our unsatisfied desires in this respect?


John Whitney Pickersgill: Mr. Speaker, I shall be very glad to let the C.B.C. know of the hon. gentleman's urge for self advertisement.


BRITISH COLUMBIA
[Stage Direction]
On the orders of the day:
Mr. Barry Mather (New Westminster):: Mr. Speaker, I have a question I would like to direct to the Minister of Fisheries, notice of which I have given. I wonder whether the
Inquiries of the Ministry minister could report to the house today on the situation in British Columbia where several thousand fishermen and allied workers are on strike, and in particular can he clarify the advice which his department reportedly gave to those in the dispute, that they seek to settle their differences through the proper authorities? My understanding is that while tendermen and shore workers are a provincial responsibility, fishermen are somewhat a federal responsibility.


Hédard-J. Robichaud: Mr. Speaker, I wish to thank the hon. member for sending me notice of his question, which was handed to me on my way down to the chamber. However, I wish to report that I have been kept continuously informed on the situation since a strike was declared on Saturday, July 13 affecting 10,000 British Columbia salmon net fishermen and allied workers. On Friday last the negotiations broke down between the fisheries association of British Columbia and the united fishermen and allied workers union. While realizing that a dispute of this nature comes under provincial jurisdiction, I sent a telegram to both parties suggesting that every possible action be taken to bring price and wage negotiations to a successful conclusion, and resume operation as soon as possible.
On Monday of this week an agreement was reached with the Prince Rupert co-op. affecting 600 to 700 fishermen, who resumed their fishing operation at once. Yesterday, realizing that the loss to the British Columbia economy had already reached the vicinity of $4 million and could lead to a total loss of $12 million to $14 million, I sent a second telegram to both parties expressing my concern about the present and future economy of the fishing industry unless every effort were made to reach a settlement. 1 further suggested that I would welcome reference to proper authorities in order to bring about action necessary to reach agreement.
In reply to the second part of the hon. member's question, I wish to clarify this advice and particularly my reference to proper authorities. The united fishermen and allied workers union is certified under the provincial laws of British Columbia as bargaining agent for tendermen and workers in most fishing plants of that province. While they are not certified under the labour laws for bargaining on behalf of fishermen, section 25 of the province of British Columbia fisheries act, chapter 150, revised statutes of British Columbia provides for arbitration procedures, provided they are asked for, and this is agreed by both parties involved. As there is
2578	HOUSE OF
Inquiries of the Ministry no federal legislation to cover such a situation, this is what I had in mind when I suggested reference to proper authorities in order to bring about action necessary to reach agreement.


AGRICULTURE
[Stage Direction]
On the orders of the day:
Mr. Clement Vincent (Nicolel-Yamaska):: Mr. Speaker, I have a question I want to ask in French.
(Translation):
Can the minister inform the house whether he has been in touch with the provinces concerning the establishment of a system of free milk distribution in schools?
(Text):


Harry William Hays: In reply to the hon. member, Mr. Speaker, may I say I have discussed the matter indirectly with all provincial ministers of agriculture. When the problem has been resolved I will bring it before the house.


NORTHERN AFFAIRS
[Stage Direction]
On the orders of the day:
Hon. Guy Favreau (Minister of Citizenship and Immigration):: Mr. Speaker, I would like to answer a question which was put on Monday by the hon. member for Grey North (Mr. Noble), and which was taken as notice by the Minister of Northern Affairs and National Resources (Mr. Laing). It related to the alleged plight of 20 Indians, nine of whom are children, and who the hon. member was advised were in very bad circumstances. The answer is as follows.
These Indians are a small group who left their reserve at Romaine this year to make their way to St. Augustine, where they once lived. They left behind them at Romaine homes, services and the regular attention of agency staff. The department maintains no staff at St. Augustine, but the provincial department of youth and welfare and the diocesan social agency at Hauterive were informed and are aware of this situation.
The department has made it clear that it will defray the costs of transportation in order that these Indians may return to their homes at Romaine. The Indian affairs regional office in Quebec and the Indian agency office at Seven Islands, on my personal instructions, are looking into this matter further, and I shall be pleased to give the hon. member further details when a report from my officials has been received.



LIVESTOCK


[Stage Direction]
On the orders of the day:
Horace Andrew (Bud) Olson: Mr. Speaker, I would like to address a question to the Minister of Agriculture, of which I have sent him notice. It arises out of a further outbreak of anthrax in buffalo herds in the Northwest Territories. What is being done to eradicate this disease and, more important, to prevent its spread to domestic animals and the human population?


Harry William Hays: Mr. Speaker, I would first like to thank the hon. member for sending me notice of his question. The recent outbreak of anthrax in the Northwest Territories is in the Fort Smith area and is similar to the larger outbreak a year ago.
Anthrax is a reportable disease under the Animal Contagious Diseases Act, and the health of animals branch of the Department of Agriculture has a veterinary officer in the area working with the northern affairs wildlife people on control measures. Anthrax does not spread from animal to animal but is a soil borne disease. Animals become infected by picking up the organism from the soil. Once the organism is established in the soil it may exist there for many years.
There are periodic outbreaks of anthrax in other areas of Canada, and in these cases the safe disposal of infected carcasses and the cleaning and disinfection of the infected premises are supervised by department veterinarians, and at the same time other cattle on infected premises are vaccinated. The department, under the provisions of the Animal Contagious Diseases Act, is attempting to institute these same principles of control in the Fort Smith area. All infected carcasses are being buried. Attempts have been made to keep the buffalo out of the infected zone, and last fall attempts were made to burn off the infected area in order that buffalo would not return to it.
I might say further, Mr. Speaker, that I do not know whether you have ever had anything to do with the buffalo, but he is a pretty wild bird; and if we could get the hon. member for Acadia (Mr. Horner) to use the lariats he was talking about recently to rustle them, then I think we could vaccinate them.


Mr. J. E. Pascoe (Moose Jaw-Lake Centre):: Mr. Speaker, I tried to catch your eye earlier in regard to a supplementary question I wished to ask the Minister of Agriculture. It may be too late now, but I ask Your Honour's

indulgence. Does the minister's announcement in regard to anthrax mean that there will be 60 days of "anthraxion"?



INDUSTRY


[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Port Arthur):: Mr. Speaker, I would like to ask the Minister of Mines and Technical Surveys a question based on my understanding that the minister has been working on the matter of lower freight rates for the Steep Rock iron range. Has the minister anything to report in the way of progress in this matter, which is so important to his own constituency and the general area?


Hon. W. M. Benidickson (Minister of Mines and Technical Surveys):: Mr. Speaker, the hon. member for Port Arthur was kind enough to send me, about a month ago, copies of letters he had initiated to Canadian National Railways with respect to a freight rate that might make the transfer of pelletized ore advantageous from this area. I have lately told him in writing that this was not at the moment an impediment to any further industrial advancement in this area.
I am told by the officials of Canadian National Railways that the rate that would apply there to rough ore would also apply to the rate on somewhat refined ore if a pelletizing plant were provided at Atikokan. That is not the problem at the moment; the problem is to be able to sell competitively all the ore that Atikokan could produce on the present basis.


Douglas Mason Fisher: A supplementary question, Mr. Speaker. I would like to ask the minister whether the lower freight rates which he has investigated, may not be a factor in being able to sell competitively.


William Moore Benidickson: Mr. Speaker, I wish to inform my colleague from the adjoining riding of Port Arthur that I have been giving this matter great study, and I am told it is not a selling factor at the moment.



INQUIRIES OF THE MINISTRY

[Stage Direction]
On the orders of the day:
Mr. J. J. Greene (Renfrew South):: Mr. Speaker, I have a question for the Prime Minister. Would he tell us whether the government is considering appropriating funds for the national gallery to purchase the Dr. Ward picture of the right hon. Leader of the Opposition?


Some hon. Members:: Oh, oh.
Inquiries of the Ministry


John (Jack) Henry Horner: Mr. Speaker, I have one short, quick question to the Minister of Agriculture. Due to the presence in Ottawa at this time of the former member for Assiniboia, can the minister confirm or deny persistent and authoritative rumours that he is going to be hired as the minister's special assistant?


Some hon. Members:: Oh, oh.


John (Jack) Henry Horner: Silence is consent.



INQUIRY AS TO NEGOTIATIONS WITH RED CHINA

[Stage Direction]
On the orders of the day:
Mr. E. Nasserden (Rosthern):: Mr. Speaker, I should like to direct a question to the Minister of Trade and Commerce. Has an agreement covering sales of grain been arranged with China by this government?


Mitchell William Sharp: Mr. Speaker, I have been asked a question about these negotiations every day, and I have replied that they are still continuing. I can assure the hon. member that as soon as the negotiations are concluded there will be an announcement in this house.


Mr. Speaker:: The hon. member for Moose Jaw-Lake Centre.


Edward Nasserden: A supplementary question, Mr. Speaker.


Mr. Speaker:: I am sure the hon. member has received a full reply.


Edward Nasserden: I have a supplementary question, Mr. Speaker.


Mr. Speaker:: Perhaps the hon. member would contain himself until later today or until tomorrow.
(Translation):



ARTS, LETTERS AND SCIENCES REPORTED STATEMENTS BY MEMBERS OF COMMISSION

[Stage Direction]
On the orders of the day:
Paul Raymond Martineau: Mr. Speaker, I should like to put a question to the Prime Minister.
Is he aware of the statements made and of the interviews given by the newly appointed members of the royal commission on biculturalism, and could he tell us whether he approves this practice, on the part of the commissioners, of commenting on the questions they will be called upon to look into? (Text):


Lester Bowles Pearson: Mr. Speaker, I am not aware of these statements.

Inquiries of the Ministry (Translation):



SUGGESTED APPOINTMENT OF FRENCH CANADIAN FROM ONTARIO

[Stage Direction]
On the orders of the day:
Mr. L. J. Pigeon (Jolietle-L'Assompiion-Montcalm):: Mr. Speaker, I should like to put a question to the Prime Minister. Does he intend to increase the membership of the royal commission on biculturalism by appointing a French speaking commissioner from Ontario, in order to comply with the request of the "Association canadienne-frangaise de l'Education de 1'Ontario"?
(Text):


Lester Bowles Pearson: Mr. Speaker, I have nothing to add to what I said yesterday with regard to this matter.
(Translation):


Hon. Theogene Ricard (St. Hyacinihe-Bagot):: Mr. Speaker, may I ask the Prime Minister a supplementary question arising from the answer he gave the hon. member for Pontiac-Temiscamingue (Mr. Martineau) a moment ago? Does he agree with Mr. Jean Louis Gagnon who says that Canada should be divided into cantons?
(Text):


Lester Bowles Pearson: I have not seen the suggestion, so I do not think I should comment.
(Translation):



CANADIAN NATIONAL RAILWAYS


[Stage Direction]
On the orders of the day:
Mr. Robert Beaule (Quebec East):: Mr. Speaker, I should like to direct my question to the Prime Minister.
Can he tell the house if he intends to renew Mr. Donald Gordon's term of office as chairman of the board of the Canadian National Railways?
(Text):


Lester Bowles Pearson: Mr. Speaker, an announcement may be made in the House of Commons on that matter in due course.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. Andrew Brewin (Greenwood):: Mr. Speaker, my question is for the Minister of Labour and I have given him notice of it. Is he aware of the fact that 325 employees were laid off last Thursday in Collingwood by Canadian Shipbuilding and Engineering 
Limited, and the future employment of the remaining 526 employees is precarious? What steps, if any, are to be taken to assist in dealing with this situation, which is rather serious for the economy of the community of Collingwood?


Allan Joseph MacEachen: Mr. Speaker, I wish to thank the hon. member for sending me notice of his question. I certainly share his interest in unemployment, or threatened unemployment, as a result of this lay-off, and I wish to inform him that I have asked the national employment service to provide me with a report on the nature and extent of this lay-off. Following receipt of the report my departmental officials will consider what action, if any, can be taken to assist in this situation.



THREATENED STRIKE ON U.S. RAILROADS

[Stage Direction]
On the orders of the day:
Mr. Speaker:: The hon. member for
Megan tic.


Mr. Raymond Langlois (Megantic):: Thank you, Mr. Speaker, I have been bouncing up and down for the past hour. I should like to ask a question of the Minister of Transport in connection with one I asked him yesterday about the possible railroad strike in the United States. What does he intend to do with regard to our own railroads in the United States in the case of a strike?


Jean-Charles Cantin: Mr. Speaker, I will take this question as notice.



PUBLIC SERVICE


[Stage Direction]
On the orders of the day:
Robert Norman Thompson: Mr. Speaker, I direct my question to the President of the Privy Council. In view of the creation and the setting up of a new government department, the department of industry, can the minister inform the house when he might be able to report on the government's initial decision regarding the implementation of the Glassco commission report?


Maurice Lamontagne: Mr. Speaker, I wish to thank the hon. member for sending me notice of his intention to ask this question. The special cabinet committee, with the assistance of the interdepartmental committee of officials, which has been set up to consider the recommendations of the Glassco commission, are proceeding with their work, and I expect to be in a position to make a more detailed report to the house on this most important matter

when parliament reconvenes, after the recess which we may all be fortunate enough to have.



SHIPPING


[Stage Direction]
"bluenose"
On the orders of the day:
Mr. Gerald A. Regan (Halifax):: Mr. Speaker, I should like to direct a question to the Minister of Fisheries. Is the minister aware of this morning's launching in Lunenburg of the exact replica of the world famous racing and fishing schooner Bluenose, which raced undefeated for many years, which was lost at sea in 1944, and the picture of which has appeared on the Canadian 10 cent piece for many years?


Hédard-J. Robichaud: Mr. Speaker, the minister is well aware of the launching of the new schooner Bluenose which took place in Lunenburg this morning. I had an invitation to attend the launching but unfortunately I had to express my regrets. I wish I was there today to enjoy the sea breezes of the great Atlantic, where on a day like this air conditioning is provided by mother nature.



BUSINESS OF THE HOUSE

[Stage Direction]
legislative plans for current portion of

[Stage Direction]
On the orders of the day:
John George Diefenbaker: Mr. Speaker, there naturally arises at this time the question of the general plans for the remainder of this portion of the session. Would the Prime Minister be in a position tomorrow to generally outline the program the government has in mind and which it will expect to have completed by the time of the adjournment, and can he give the house a general idea as to when parliament will be reconvened? I do not know whether he can do this today, but possibly he might be able to do it tomorrow.


Lester Bowles Pearson: Well, Mr. Speaker, discussions are going on among representatives of the four parties which have a bearing on this question. Perhaps I had better take advantage of the right hon. gentleman's suggestion and make a statement on the matter tomorrow.
(Translation):



REQUEST FOR REPLIES TO QUESTIONS ON ORDER PAPER

[Stage Direction]
On the orders of the day:
['The question of increased federal assistance to education is under consideration.']
Mr. Gerard Perron (Beauce):: Mr. Speaker, I should have liked to put my question to the
Inquiries of the Ministry Postmaster General, but in his absence I shall direct it to his parliamentary secretary. Is it intended to answer the series of questions Nos. 506 to 537 inclusive, dated June 17, on the order paper, before the end of this session?
Hon. J. P. Deschatelets (Minister of Public
Works): Mr. Speaker, I take the hon. member's question as notice and the Postmaster General will answer it later.
(Text):



[Stage Direction]
On the orders of the day:
Mr. Stuart A. Fleming (Okanagan-Revelsloke:) Mr. Speaker, may I address my question to either the Minister of Northern Affairs and National Resources or to the Minister of Mines and Technical Surveys. Would one or the other inform the house whether recent scientific developments in the United States have brought about such a reduction in the cost of producing thermal or atomic electrical power that there is now virtually no possibility of the sale of British Columbia surplus power in the United States at a price of five mills?
John Whitney Pickersgill: Mr. Speaker, I rise on a point of order. It seems to me that when we have reached the point when an hon. member does not know to which minister to address a question, and when the question is obviously in the form of a debate, perhaps the house should proceed to the orders of the day and debate what is supposed to be before it, instead of debating a different subject. The period before orders of the day is one for urgent questions, not for debate.


Mr. Fleming (Okanagan-Revelsloke):: Mr. Speaker, on the point of order; I am afraid the ignorance in this case lies with the Secretary of State. Thermal power is produced from coal, and this comes under the jurisdiction of the Minister of Mines and Technical Surveys; hydro power comes from the use of water, which comes under the jurisdiction of the Minister of Northern Affairs and National Resources, who controls the water resources branch of the department. So either minister could answer this question.


John Whitney Pickersgill: Mr. Speaker, I submit that the question is not urgent and should not be put at this stage of our proceedings.


Some hon. Members:: Oh, oh.


Mr. Speaker:: Order, please. Without taking sides, naturally, I should like to point out that this is a short day, that we have had a particularly long session of questioning this afternoon, and that it is now four o'clock and we adjourn at six.

Inquiries of the Ministry Mr. Fleming (Okanagan-Revelsloke): Mr. Speaker, with the greatest deference, if you would hear me a moment, I agree that the question period has gone on for a long time and I regret that 1 find it necessary to introduce this question at this late hour in the day. However, it is of substantial concern to the province of British Columbia whether negotiations which are supposed to be taking place do have any real merit in them, or whether they are a further hoax on the people of that province.


HEALTH AND WELFARE
[Stage Direction]
On the orders of the day:
Thomas Clement (Tommy) Douglas: Mr. Speaker, may I direct a question to the Minister of National Health and Welfare. In view of the alarming increase in Canada of contamination from radioactive fall-out, could I ask what steps her department is taking to promote a system of decontamination of milk and to establish a more effective monitoring system, as requested by the Canadian Voice of Women?


Hon. Judy V. LaMarsh (Minister of National Health and Welfare):: Mr. Speaker, I am sure my hon. friend does not expect to have such a question answered on orders of the day. If he takes time to put it in the form of a written question I shall be very pleased to have it answered.


DOMINION-PROVINCIAL CONFERENCE ONTARIO-INQUIRY AS TO DISCUSSIONS WITH PREMIER ROBARTS
[Stage Direction]
On the orders of the day:
Hon. Leon Balcer (Three Rivers):: I should like to ask the Prime Minister if he has sent a delegation of Ontario members of his cabinet to meet with Premier Robarts and discuss with him federal-provincial relations prior to the meeting which is to take place shortly.


Lester Bowles Pearson: I had a discussion with Premier Robarts myself a few weeks ago. I think I am the only member of the cabinet who has discussed this matter with him.
(Translation):


SHIPPING
[Stage Direction]
On the orders of the day:
Jean Robert Beaulé: Mr. Speaker, may I direct a question to the Minister of Transport or to his parliamentary secretary? Have measures been taken to protect


ships from the wrecked Tritonica in the St. Lawrence river?


Jean-Charles Cantin: I
think that question has been answered already.


DOMINION-PROVINCIAL RELATIONS REQUEST FOR INCREASED FEDERAL AID TO EDUCATION
[Stage Direction]
On the orders of the day:
Louis-Joseph Pigeon: Mr. Speaker, may I ask the Prime Minister a question? Does the government propose to grant the request of the Canadian teacher's federation and increase its financial aid to the universities and, in a general way, its financing of education.
(Text):


Lester Bowles Pearson: The question of increased federal assistance to education is under consideration.



WAYS AND MEANS

[Stage Direction]
The house in committee of ways and means, Mr. Batten in the chair.

[Stage Direction]
Resolved,-That it is expedient to introduce a measure to amend the Excise Tax Act and to provide among other things:
1.	That the present exemption from sales tax for certain building materials be withdrawn by repealing the exemption for all goods mentioned under the heading "Building Materials" in Schedule III of the said act and by repealing the exemptions for
(a)	"Creosote oil and other wood preservatives when for use exclusively in the treatment of timber, poles or lumber;''
(b)	"Railway ties;''
(c)	"Goods for use as part of sewerage and drainage systems, and articles and materials to be used exclusively in the manufacture thereof;"
2.	That any enactment based on paragraph 1 of this resolution provide that
(a)	goods for use as part of sewerage and drainage systems be exempt from sales tax when sold to or imported by a municipality for its own use and not for resale;
(b)	any transfer of a sewerage or drainage system to a municipality by any person within two years after the completion thereof, pursuant to a bylaw of or agreement with that municipality under which that person is required to install such system and transfer it without charge to that municipality after the completion thereof be deemed, for the purpose of section 46 of the said act, to be a sale to the municipality for its own use and not for resale of goods for use as part of a sewerage or drainage system,
and that any agency operating a sewerage or drainage system for or on behalf of a municipality may be declared by the minister to be a municipality for the purpose of this paragraph.

3.	That any enactment based on paragraph 1 of this resolution provide that drain tile for agricultural purposes and materials to be used exclusively in the manufacture thereof be exempt from sales tax.
4.	That any enactment founded on paragraph 1 of this resolution provide that where materials have been purchased by or on behalf of a school, university or other similar educational institution for use exclusively in the construction of a building for that institution and the tax imposed by Part VI of the said act has been paid in respect of those materials, the Minister of National Revenue may upon application by the institution in such form as the minister prescribes made to the minister within two years from the time the materials were purchased, pay to the institution an amount equal to that tax.
5.	That any enactment founded on paragraph 1 of this resolution provide that a person who
(a)	manufactures or produces a building or other structure otherwise than at the site of construction or erection thereof, in competition with persons who construct or erect similar buildings or structures not so manufactured or produced,
(b)	manufactures or produces otherwise than at the site of construction or erection of a building or other structure, structural building sections for incorporation into such building or structure, in competition with persons who construct or erect buildings or other structures that incorporate similar sections not so manufactured or produced, or
(c)	manufactures or produces concrete or cinder building blocks, be deemed for the purposes of the said act not to be, in relation to any such building, structure, building sections or building blocks so manufactured or produced by him the manufacturer or producer thereof.
6.	That the present exemption from sales tax for "Seventy five per cent of the sale price if manufactured in Canada, or seventy five per cent of the duty paid value if imported, of trailers for use as homes" be changed to read ''Twenty five per cent of the sale price if manufactured in Canada, or twenty five per cent of the duty-paid value if imported, of trailers for use as homes".
7.	That the present exemption for certain machinery and apparatus to be used in manufacture or production be withdrawn by repealing the exemption for all goods mentioned under the headings "Machinery and Apparatus to be used in Manufacture or Production" and "Engines" in Schedule III of the said Act and by repealing the exemptions for
(a)	"Seismic shot-hole casing and materials used in the manufacture thereof;"
(b)	"Tires and tubes for use exclusively on the machinery enumerated in Customs Tariff Item 411a."
(c)	Goods enumerated in customs tariff items 399a, 399b, 399c, 411a, 417, 431h, 439c, 848, 848a and 848b.
8.	That any enactment founded on paragraph 7 of this resolution provide that traction engines for farm purposes and accessories therefor (not including machines and tools for operation by such engines) and complete parts of all the foregoing, and materials to be used exclusively in the manufacture of the said engines, accessories or parts be exempt from sales tax.
9.	That any enactment founded on paragraph 7 of this resolution provide that farm wagons, including four-wheeled farm wagons equipped to be tractor drawn and farm sleds, and materials to be used exclusively in the manufacture thereof be exempt from sales tax.
10.	That the present exemption from sales tax for "Photographs, paintings, pastels, drawing and other art work and illustrations of all kinds, whether
Excise Tax Act
originals, copies or proofs, and printing plates made to reproduce the same, for use exclusively as non-advertising news pictures or for illustrating non-advertising articles or stories in periodical publications enjoying second-class mailing privileges, the pages of which are regularly bound, wired, stitched or otherwise fastened together;" be changed to read "Typesetting and composition, metal plates, cylinders, matrices, film, art work, designs, photographs, rubber material, plastic material and paper material, when impressed with or displaying or carrying an image for reproduction by printing, made or imported by or sold to a manufacturer or producer for use exclusively in the manufacture or production of printed matter."
11.	That feeds for fish, supplements for addition to such feeds, and materials to be used exclusively in the manufacture of such feeds or supplements be exempt from sales tax.
12.	That the exemption from sales tax for materials for use in the equipment and repair of ships over ten tons net register tonnage be restricted to materials for use in the equipment and repair of ships to be used exclusively for commercial purposes.
13.	That the present exemption from sales tax for "Bakers' cakes and pies including biscuits, cookies or other similar articles;" be changed to read "Bakers' cakes and pies including biscuits, cookies and similar articles but not including simulated chocolate bars or candy bars;".
14.	That the export duty of three one hundredths of one cent per kilowatt hour on electrical power exported from Canada be repealed.
15.	That any enactment founded on paragraphs 1 to 13 of this resolution be deemed to have come into force on June 14, 1963, and any enactment founded on paragraph 14 of this resolution be applicable in respect of electrical power exported after June, 1963.
16.	That with respect to the period commencing June 14, 1963 and ending March 31, 1964, the rate of tax payable under Part VI of the said act in respect of any goods for which exemption from tax was withdrawn by any enactment founded on paragraphs 1 and 7 of this resolution be four per cent instead of eight per cent, and that with respect to the period commencing June 14, 1963 and ending December 31, 1964 the rate of tax payable under subsection (1) of section 10 of the Old Age Security Act in respect of any such goods be nil.
17.	That the said measure further provide that
(a) where any tax under Part VI of the said act
has become payable by any person in respect of any goods for which exemption for tax under that part was withdrawn by any enactment founded on paragraphs 1 and 7 of this resolution, which goods were, not later than December 31, 1964, sold and delivered by that person, or applied by that person to a use resulting in the property in the goods passing from that person, pursuant to a bona fide contract in writing
(i)	that provided for the sale of those goods or their application to that use for a fixed amount stated in the contract and that did not permit the adding of the tax to the amount payable to that person under the contract, and
(ii)	that was signed by the parties thereto
(A)	on or before June 13, 1963, or
(B)	after June 13, 1963, if the contract was entered into in accordance with the terms of a tender in writing submitted by that person on or before that day whereby that person undertook to enter into such a contract and in default of so doing to incur or cause to be incurred a pecuniary penalty whether by forfeiture of a security deposit or otherwise,
[Stage Direction]
Excise Tax Act
a refund, or deduction from any of the taxes imposed by the said act, of the tax or such part thereof as could not under the contract be added to the amount payable to that person thereunder may be granted to that person; and
(b) where any goods for which exemption from tax under Part VI of the said act was withdrawn by any enactment founded on paragraphs 1 and 7 of this resolution were, after June 13, 1963 and not later than December 31, 1964, sold and delivered by any person, or applied by any person to a use resulting in the property in the goods passing from that person, pursuant to a bona fide contract in writing.
(i)	that provided for the sale of those goods or their application to that use for a fixed amount stated in the contract and that did not permit the adding of any tax under that part that became payable after June 13, 1963 in respect of those goods to the amount payable to that person under the contract, and
(ii)	that was signed by the parties thereto
(A)	on or before June 13, 1963, or
(B)	after June 13, 1963, if the contract was entered into in accordance with the terms of a tender in writing submitted by that person on or before that day whereby that person undertook to enter into such a contract and in default of so doing to incur or cause to be incurred a pecuniary penalty whether by forfeiture of a security deposit or otherwise,
an amount equal to the tax or such part thereof as could not under the contract be added to the amount payable to that person thereunder may, where application therefor is made to the Minister of National Revenue by that person in such form as the minister prescribes within two years from the time the goods were delivered by that person or applied by him to that use, and the minister is satisfied that the tax has been paid, be paid by the minister to that person.
The Deputy Chairman:: When the committee adjourned last night we were considering paragraph 1 of the resolution.
(Translation):


J.-H.-Théogène Ricard: Mr. Chairman, when we adjourned last night, I was saying that the budget introduced by the present Minister of Finance (Mr. Gordon) has spread confusion, anxiety and suspicion in all classes of our society. Today, I would like to discuss a few articles published in certain papers in order to prove my argument: for instance, in Granby's La voix de I'Est we find in an editorial dated July 6, 1963, that the Minister of Finance was harshly criticized on three points. The first title says, for instance:
Mr. Gordon has to give up 11 per cent tax.
And the text of the article says, among other things:
For that tax imposed on investments and production is prohibitive and harmful, the more so as it will be applied at a time when new investments in industry and business and an increase in production are needed to develop our economy and fight unemployment.
And under this second title:
Violent protests.
[Mr. Pearson.!
We find this and I quote:
Quebec hydro will have to pay an additional $66 million over the next five years. The Quebec government would also see a large increase in its expenditures due to its large investments.
And a third title:
An incompetent minister.
We find this:
This tax is, in fact, a very heavy burden for governments and businessmen. It discourages all investment, even of the most essential nature. Being an obstacle to the expansion plans of the provincial and municipal administrations, it practically leaves no possibility to businessmen to compete with foreign production.
Well, Mr. Chairman, those were the remarks found in the newspapers about the budget submitted by the hon. Minister of Finance, which, according to the minister's own words, was supposed to give some impetus to allow for the progress of Canadian business and industry.
I have here a communication addressed to the Minister of Finance by the Canadian shoe manufacturers association:
Allow us to voice the deep concern of the Canadian shoe industry about the serious effects of your decision to extend the 11 per cent tax to machinery, equipment and industrial supplies.
Faced with keen competition and increased imports of foreign shoes, our Canadian manufacturers have been able to maintain the price of shoes, even though their profits have dwindled.
The new sales tax will considerably increase our costs and the price of shoes will soon reflect the new federal tax.
I could easily go on for quite a while, and quote other newspaper stories, blaming the stand taken by the hon. Minister of Finance during his budget speech, on June 13.
However, I shall be content to quote the headlines of articles by Mr. Laurent Lauzier, in La Presse. On July 6, 1963, his headline was:
A new period of uncertainty.
On the 16th, he wrote:
A rather gloomy prospect.
Again, on the 19th, his headline ran:
The situation is deteriorating.
And so forth. Mr. Chairman, these are comments on a budget which was going to give Canada, or so we were told, a new look. It was going to open up new foreign markets, create new jobs and cure unemployment.
However, having carefully studied the various observations bearing on the tax levied by the hon. Minister of Finance, we are led to believe that far from creating new job opportunities, the measures submitted by the minister will, to the contrary, breed unemployment.

On that matter, I should like to read into the record what the leaders of one of our labour unions, namely the Canada building workers' federation, said in a letter sent to the Minister of Finance. I quote:
To lay out a nine point plan to fight unemployment and at the same time undermine the foundation of the industry in which large projects can be carried out to fight unemployment would only mean to run around in circle, in a vicious circle. The building workers' federation is conscious of the present situation of the national economy and does not believe that your proposal is likely to improve it.
There, Mr. Chairman, you have people who certainly know what they are talking about because they are involved in the building industry and who can also appreciate the effects of the imposition of the new tax, even if it is relaxed or applied gradually.
And what about the reaction of provincial, municipal and school authorities concerning this tax? At this stage, may I recall the remarks made by the Quebec minister of natural resources when he learned about the imposition of that new tax. He passed a very severe judgment on the proposal, stating that it would lead to increased costs and would hamper progress in the province of Quebec.
I have in my hand an article published in the paper La Voix de I'Est following an interview with the mayor of St. Hyacinthe.
(Text):


Mr. Byrne:: Mr. Chairman, on a point of order, last evening when the hon. member for Waterloo North was speaking I drew the attention of the Chair to the fact that it was quite outside the rules of the house for a member to read documents and newspaper articles that reflect upon the proceedings of the current session of the house. I did not press the matter at the time because the hon. member for Waterloo North, like myself is a backbencher. But what has happened this afternoon, as happened yesterday afternoon in the case of the hon. member for Ontario, is that speeches are being made based almost entirely upon articles which members have read from various newspapers or on letters that have been directed to certain individuals.
I think it is an understood proposition in the House of Commons that a member is elected to represent every section of the economy within his riding and is certainly to receive representations from each, but he is not here to be the voice of every special interest before the House of Commons.


An hon. Member:: What a point of order.


James Allen (Jim) Byrne: The member himself is to prepare his own speech and to present it to
Excise Tax Act
the house. If what I am saying requires proof, Mr. Chairman, I would refer to chapter III, rules of debate, in Beauchesne, fourth edition, citation 149 reads as follows:
Besides the prohibitions contained in standing order 35 it has been sanctioned by usage both in England and in Canada that a member, while speaking, must not:
(1) read from a printed document or book commenting on any speech made in parliament during the session.
There are other citations relevant to the hon. member's speech which I might read but I will refer only to paragraph (o), which is in these words:
(o) read from a written, previously prepared speech.
That is also not within the rules. I simply bring that to the hon. member's attention, although I am not making a point of it. Last evening I also read a ruling by Mr. A. E. Ross, acting deputy speaker, made on March 1, 1933 and found on page 802 of Beauchesne, third edition. It is in these words:
It is out of order to quote in committee articles from newspapers commenting on the proceedings then under consideration.
Since the hon. member is a frontbencher I would expect that he would prepare his speech and try to stay within the rules of the house. So I am going to ask the Chair to insist that he do so.


Mr. Paul:: On the point of order, Mr. Chairman.
(Translation):
Mr. Chairman, the member who just spoke is perhaps the voice crying in the wilderness, because ever since we started consideration of this budget resolution, he has tried constantly to prevent opposition members from commenting on the resolution.
(Text):


James Allen (Jim) Byrne: On a question of privilege, Mr. Chairman, that is quite improper.


Mr. Nesbitt:: We listened to you. Now you listen to him.


James Allen (Jim) Byrne: I have not attempted to stop members from doing anything except what is not within the rules of the house. I suggest that the hon. member has no right to reflect upon my intentions because all I am doing is insisting that the rules of the house be followed.
(Translation):


Rémi Paul: Might I suggest to the hon. member that he study the rules of the house? The hon. member for St. Hyacinthe-Bagot (Mr. Ricard) who has the floor at

Excise Tax Act
present has obviously the right to quote the comments which were made on this tax. I can understand that this does not suit my hon. friend who has intervened, but I would suggest that when he rises on a point of order or a question of privilege, he should do so for a good reason, not only to distract the chairman or to interrupt the member who has the floor or because he does not agree with his political opinions.
(Text):


Mr. Weichel:: On the point of order, Mr. Chairman, I should like to say to the hon. member that I prepared my own speech and when I was speaking last night I was expressing the opinions not only of thousands of Canadians in my own riding but in all of Canada with regard to the betterment of this country. I was not trying to dictate.


An hon. Member:: For the withdrawal of the tax.


James Allen (Jim) Byrne: I did not suggest that the hon. member for Waterloo North had not prepared his own speech. I do suggest that the hon. member read articles from newspapers and letters addressed to other people in complete contravention of the rules of the house.


Mr. Lambert:: You are talking blatant nonsense now.


Herman Maxwell Batten: Order. I recognize that it is necessary at times to support an argument a member is making by reading articles from newspapers if the member wishes to do so. I also recognize the authority cited by the hon. member for Kootenay East. In addition, I have in mind citation 157 in Beauchesne, fourth edition. I am sure the hon. member for Kootenay East will appreciate that this is a very difficult decision for the chairman to make. I would say to the hon. member who is now addressing the committee that it would be pleasing to the Chair if he would refrain from making too many of these quotations, but I understand that he wants to support the argument that he is making.


J.-H.-Théogène Ricard: Mr. Chairman, you will have noted that some time has been taken by this point of order and I trust that allowance will be made for that in deciding when my time runs out. I should like to say to the hon. member for Kootenay East that before trying to lecture somebody else he had better learn his own lessons. He said a while ago that I was reading my speech. I never prepare a text; all I have is a few notes. If he cannot say anything in this house without reading it, then he had better go outside and learn his lessons before he comes here.

I also feel that I am speaking on behalf of somebody, because the mayor of St. Hyacinthe is certainly representing a city of 35,000 people. When I quote members of trade unions or federations or construction associations, they in turn are speaking on behalf of other people. They are all speaking on behalf of someone. If the hon. member for Kootenay East does not know this, then I suggest he sit down and remain silent or learn his lessons before he opens his mouth.


James Allen (Jim) Byrne: I am quite happy to receive this lecture from the hon. member.


An hon. Member:: You deserve it.


James Allen (Jim) Byrne: However, I want to draw to the attention of the house once more citation 157, despite the fact the chairman overruled my objection, because this still does not give an hon. member licence to read without qualification, and base the major portion of his speech on articles that have been prepared by persons other than the member himself. I believe this is a rule of the house, and if we are going to make honest decisions then we should hear the honest opinions of the members themselves. A member should, in the main, prepare his own speech and not read almost entirely from articles.


J.-H.-Théogène Ricard: You never have to refer to anyone because you have got enough to satisfy your own needs.
(Translation):
Mr. Chairman, to go on with what I was saying a moment ago, I have here a copy of an item which says that the mayor of St. Hyacinthe called the tax an obstacle and a hindrance to the establishment of industries in the city of St. Hyacinthe.
He was not the only one to make such a remark, as I also have here the opinion of a contractor, Mr. Gaston Maillotte, who heads an important industry in St. Hyacinthe and who stated that, because of that new tax, the building industry will experience a considerable slowing down which will increase unemployment in the months to come.
I also have here a communication from the knitwear union of St. Hyacinthe, which wanted to put in a protest to protect its members. When something is said on behalf of 450 employees and if we take for granted that each one has an average family of three persons, this means a good many tax-paying citizens-I think it represents a great number of people.
I also received a great number of letters of protest against such unfair imposition of industry. For instance, Mr. Benoit Lainesse

wrote me to say that the considered enlargement of his industry, which was to give work to at least 10 more employees or so, has necessarily been postponed, because he cannot, at this time, afford the luxury of additional taxation.
All that, Mr. Chairman, to remind you that when presenting his budget, the Minister of Finance (Mr. Gordon) stated that he would give a new impetus to our economy and fight unemployment by imposing a 30 per cent tax on foreign purchases of Canadian securities.
Since then, all we have learned from the Minister of Finance is that during the coming year, the best that the Liberal government can do-we must not forget their rash promises during the election campaign-is to foresee a 5 per cent increase in the gross national product. If we consider that in 1962 there was an 8 per cent increase, then we can say to the magicians in front of us that they have much to learn from their predecessors and that they might well use the methods of the Conservative party during its six years in office.
To regain control over our future. The Minister of Finance has levied, as I said a moment ago, a 30 per cent tax which he withdrew under the pressure of big financial interests in Canada. It should be noted, Mr. Chairman, that it was not as a result of representations from the ordinary citizens that the Minister of Finance yielded, but rather following the protests raised by the mighty.
To fight unemployment. Well, in many industries, as mentioned in a telegram I received from the homebuilders association of the district of Montreal, employers have already been forced to lay off some of their employees and they are also afraid that, sooner or later, they might have to let go of others to whom they would have liked to give work during the winter months.
During the 1961 and 1962 sessions, we heard the Liberal team tell us that they had on file the required programs and projects to get this country moving again as never before, once they were brought back in office, and that those measures would reduce unemployment. And yet, Mr. Chairman, if we look at the statistics for the last two months, we find that unemployment has kept on increasing.
And now what about the world of business? I have with me a report from the newspaper La Presse which tells us that commercial
Excise Tax Act
bankruptcies during the last two months have risen to 200, the highest figure since 1961.
All this is the consequence of a hasty and ill-conceived policy on the part of people who were supposed to transform our country into a Garden of Eden.
Mr. Chairman, after his first mistake, the minister retreated once more when he decided that the tax would be applied progressively, that is from 4 to 8 per cent and then from 8 to 11 per cent. It still remains that building materials, machinery and all the commodities which are used by our industries will be subject to the 11 per cent tax. This will certainly have disastrous effects and far from helping Canada, it will hinder our economic growth and industry in general.
In addition, the progressive introduction of the tax will lead to abuses on the part of unscrupulous speculators.
How could the government prevent speculation on the eve of the day that the tax will pass from 4 to 8 per cent and later when it is increased from 8 to 11 per cent?
Small income earners will certainly be unjustly charged a tax by unscrupulous businessmen and dealers who care only for profits and have no regard for their fellow men.
It is a well known fact, Mr. Chairman, that during the debate no backbencher on the government side has dared state his opinion on this tax. It is obvious that they do not like the tax but they have to toe the party line. They were told: "Shut up. This tax must be levied as we have decided".
During their conversations between themselves, Mr. Chairman, the backbenchers protested against their party policy, but they do not dare say a word because they are afraid of retaliation.
Once again, the team now in office gives evidence that for this political group, the interest of the party comes before that of the country.
We had proof of this during the vote on nuclear arms. All Quebec members, especially, had pledged their word to their constituents that they would object to nuclear arms. However, when the question was put, they were all in favour of them.


Mr. Cole (Longueuil):: Mr. Chairman, I rise
on a question of privilege. The hon. member who has the floor claims that all hon. members who represent the province of Quebec on this side of the house have declared themselves opposed to nuclear arms during the

Excise Tax Act
last election campaign. As far as I am concerned, I can state that such a statement is false because I, for one, never took a stand against them.


J.-H.-Théogène Ricard: Here is a new admission, Mr. Chairman. It resembles that made last night by a member of the Social Credit party who said that, after seeing the Liberal party in action, he was very sorry he had had anything to do with overthrowing the Conservative government last year. And it is only after seeing the Liberal team now in charge that one realizes how wisely public affairs were run under the previous administration.
Mr. Chairman, I will end my remarks by saying that the confusion that followed the presentation of the budget, the indecision, the withdrawals and the errors that marked the first 60 days of the present government, have led the people of Canada to realize quickly how well they were administered under the government headed by the present Leader of the Opposition (Mr. Diefenbaker).
I do not hesitate to say that the people are waiting for an opportunity to put their faith once more in the Conservative party, because they now see what the Liberal party can do in office. It is quite a different thing for the Liberal party to administer when in opposition and when in office. That party does very well in opposition but when the time comes to implement its program, that is another story.
Mr. Chairman, as I say, the Canadian people are anxious to have again a Conservative government to lead the country.
(Text):


John (Jack) Henry Horner: Mr. Chairman, in speaking about this budget and more particularly paragraph 1 of the excise tax resolution, one can only conclude from the many editorials that have been quoted, and from those that have not been quoted, that it certainly was not a popular way of raising money. In fact the minister admitted this and went on to say that no tax was popular, but this was the best of all evils. In defending it he said he still supported the 11 per cent initially announced, which is now down to 4 per cent but will later rise to 11 per cent.
Perhaps the opposition may take some credit for having it reduced a little for the time being, but this is not enough. The Canadian people want it taken off altogether, and

they have strong reasons. We are told many things by the Liberals before and during the election campaign, but since taking power they have found that some things are hard to do.
While this may not deal strictly with the excise tax, the farmers were told this afternoon that they could forget all about the $3 per bushel for the first 300 bushels of their wheat and the $2 per bushel floor price. Instead they were informed that they will get $1.50 initial payment, the same as last year, and that is all. It is another broken promise, and in a sense the budget is a complete broken promise to the Canadian electorate.
I know the hon. member for Kootenay East is a very careful guardian of the house rules and suggests hon. members obey the rules at all times. Therefore I am not going to quote editorials at length, even though there are many which could be read into the record. However there is an interesting one in today's Globe and Mail. I do not intend to read it all but it says:
The Liberal government rode into power last April 8 on a theme that was summarized by Prime Minister Lester Pearson in the sentence, "I don't think that we should spend a nickel after the election unless it contributes to the expansion of the economy."
That one sentence is sufficient to define the point I am trying to make, that expansion of the economy was what the government wanted. Therefore we must ask ourselves how this first paragraph of the resolution will aid in the expansion of the economy.
During the election campaign we were told that the economy was stagnating, and that, even though it had a growth rate of 8 per cent last year, this was not sufficient. However the budget now forecasts a 5 per cent increase in the gross national product. Is this bringing us out of the stagnation of the economy? Certainly people across the country who are giving some thought to the economy do not think so. Certainly the general public who went out to buy lumber after June 13, when this budget resolution was immediately implemented by lumber dealers, do not think so. In fact they said they would not buy lumber or cement.
What did the Canadian Chamber of Commerce have to say about it? This, Mr. Chairman, is a body which generally issues wise and carefully thought out statements. This appears in the July 5 edition of Time magazine. I will read just one brief sentence:
The Canadian Chamber of Commerce said the tax would hurt Canadian sales abroad and slow the pace of the economy.

That is it, in one brief sentence. This will hurt and slow the pace of the economy. This is an economy slowed down by a Liberal government which promised the electorate before April 8 that, because the economy was not moving fast enough, they would speed it up. They have done nothing to speed it up. This resolution, in particular, does nothing to speed it up. It is all well and good for the hon. member for Leeds to say, as he did last evening, why should not the building trades be taxed the same as all other trades in Canada. This to me was a rather irresponsible question. It shows what little thought they gave to the employment problem of this country; it shows what little thought they gave to economic conditions facing Canada today, with a greater increase in the labour force occurring every year.
We must be prepared to move in the proper direction so that these people can expect a better position in life in Canada, so they can expect a job in Canada. We must move in the direction of creating those jobs. Where, I ask you, Mr. Chairman, can a person look for work? Where can a person going out into the labour force today be expected to find a job more easily than in the building trades and the building industry across Canada generally? This is where the greatest growth rate in employment has been over the past two years, and it will continue to be, because Canada is a growing nation. We are a growing nation in spite of this budget and in spite of this tax on the building industry of Canada.
We have heard some talk about deficits and what a terrible thing is deficit budgeting. This was said yesterday by members of the Social Credit party to my right. They went on at great length to say what a terrible thing is a deficit budget and they realize this is a deficit budget. They voted for it, and they agreed that the minister should implement new taxes. I am glad they voted for this tax because they will have to return to the electorate of Alberta some day, and perhaps to the electorate of Quebec. Also, the government of the day will have to return to the electorate and explain to them that they wanted Canada to grow, but taxed the very growth they wanted. It is, and will be, a diminishing tax. Coming back to the question of deficits, Mr. Chairman, I would like to quote some figures from the Canada Year Book of 1962, page 1038. The net debt per capita for each of the years 1952 to 1956 was well over $700, ranging all the way from $773
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to $701. From 1957 to 1961 it was well under $700, being approximately $650 per capita. This explains whether there was or was not a growth in net debt. Certainly we have had deficit budgets. This was part of a policy to develop Canada; it was aimed at promoting economic growth to the extent of the 8 per cent which we were finally able to achieve. We brought in a devaluated dollar in 1962, which they criticized. What, in a sense, did that devaluated dollar do? I know, as a member from western Canada, that it aided the general agricultural picture in that area. It also aided the manufacturers in eastern and western Canada; in fact, throughout Canada.
Quoting from page 1472 of Hansard, the Minister of National Revenue had this to say in explaining this particular budget resolution. This is to be found almost at the top of the left hand column:
1 should point out that it is a manufacturers' tax-
I think those brief words explain what we are debating today. It is a manufacturers' tax. Where, I ask you, Mr. Chairman, does Canada hope to achieve the required growth in employment today? We must industrialize; this has been said from one end of the country to another. We must increase employment in our secondary industry and in our manufacturing industry. I ask the committee, in the light of many statements made in this regard, how can the government justify imposing a manufacturers' tax on the manufacturing industry of this budding, young country-


John James Greene: Mr. Chairman, would the hon. member permit a question?


John (Jack) Henry Horner: Certainly. I hope my hon. friend from Renfrew South has learned something about the tobacco industry since the last question he put to me.


John James Greene: I do not smoke, Mr. Chairman. But my question is not about the tobacco industry. I would like to ask the hon. member whether or not his party advocates deficit financing in each year and increasing deficit financing in each year.


John (Jack) Henry Horner: This is a rather simple question. Certainly we think a deficit budget is sometimes needed. I am prepared to support it and I am certain this party is prepared to support it. If Canada needs development, if Canada needs more jobs, this is the time and place for deficit budgeting. But we have heard a great deal of talk about indecision, the stalemate the country is in and how things had come to a complete standstill. What about the last three months? Every paper you picked up in the last three months said the country was in a state of flux because

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industry did not know what to do about the 11 per cent tax or the 30 per cent tax. I look at today's Globe and Mail. The headline is, "And prices go up and down". This article says:
The bond market moved up and down, like a yo-yo-
How long has it been doing this? It has been doing it ever since June 13. The bond markets, the stock markets generally have been sluggish and moving up and down like a yo-yo. This article continues:
-in response to statements first by treasury secretary Dillon in Washington and then by finance minister Gordon in Ottawa.
They are in a state of great concern as to where we are going, and certainly when one looks at this resolution he can realize why they are in such a state of great concern, because I say again that the government's own definition of it is that it is a manufacturers' tax. I want the people of Canada to know exactly what it is classified as; it is classified as a manufacturers' tax. This is what the Minister of National Revenue, when explaining it, pointed out very clearly as is reported at page 1472 of Hansard. It is a manufacturers' tax on manufacturing; I cannot repeat that too often, because I think it explains what this is. This is why I take the strongest exception to it, because it is in secondary and manufacturing industry that I have always thought and hoped Canada would grow to become perhaps an industrial nation in the years ahead.
We have heard a lot of talk about increased spending and increased deficits. There has been some indecision as to whether this tax should apply to hospitals or old folks' homes. It has finally been taken off schools and universities. Why not take it off churches and municipal buildings. Why not take it off all non-profit buildings?


An hon. Member:: And libraries.


John (Jack) Henry Horner: Yes, and libraries. The hon. member for Leeds, since my speech and the one yesterday by the hon. member for London, has changed his mind and now agrees with me and says, why not take it off everything.


Mr. Malheson:: On a point of privilege, Mr. Chairman, I by no means have changed my mind. I think it is a basic proposition that essentially one strives to tax equitably and equally; and in a competitive system, when you pick out one sector and give it special treatment there must be a compelling reason for so doing. My intervention last night was addressed to this precise point.


Mr.   Chairman@: Order. I am just wondering what is the question of privilege upon which the hon. member is rising.


John Ross Matheson: Mr. Speaker, the hon. member twice, in the course of this debate, referred to my having changed my mind with respect to a question that I raised last night. I think it is proper and fitting, in the circumstances, to remind the committee exactly what my interjection was. I do not take it back-


The Chairman:: Order. I understand the point that is being made by the hon. member for Leeds. Perhaps there is no point of privilege there. I am wondering whether just saying that an hon. member has changed his mind justifies raising a question of privilege. My suggestion would be that the hon. member for Acadia be allowed to continue his remarks.


John (Jack) Henry Horner: I want to assure the hon. member for Leeds that he should not feel self-conscious about changing his mind, because in recent days many hon. members on that side of the house have been changing their minds, particularly since June 13. Perhaps we on this side are encouraged by that, because we hope to have many hon. members on that side change their minds, and particularly the Minister of Finance, in connection with resolution No. 1.


John Ross Matheson: Mr. Chairman, my point of privilege was that I have not changed my mind, and I do not intend to change my mind on this matter. I am against continuing and growing deficits.


Lucien Lamoureux: I am sure the hon. member for Leeds, who knows the rules of the house so well, realizes that if he wants to make the point he is now making under the guise of a question of privilege, he will have his opportunity in committee when this speech is concluded.


John (Jack) Henry Horner: Thank you, Mr. Chairman. I know of the hon. member's continuing interest in the Liberal party and his secondary interest in Canada, and perhaps he will take part in the debate and explain the statement made last night which appears on page 2556 of Hansard.
When this resolution was first implemented a great hue and cry rose across the country. Time magazine of last week reported that the minister received, on the average, 350 protests a day regarding this resolution. They were protests from all walks of life. This is what Time magazine says, and I will paraphrase it because the hon. member for Kootenay East does not like to hear people reading from magazines. The hon. member can read it if he likes. The minister can

also deny it if he wants to. I accept what I read and I accept this statement. Some 350 letters and telegrams are sent to the Minister of Finance each day, mainly on this particular resolution.


Walter Lockhart Gordon: May I ask the hon. member a question. I presume they include the telegrams which were heartily in favour of this particular way of raising revenue?


John (Jack) Henry Horner: This is a very interesting interjection from the minister. He seems to be capable of making interjections which deepen himself in the well in which he has sunk since June 13. I would ask the minister right now to tell us how many are in favour, or to produce the copies of the ones he has received in favour of this particular resolution. Let the house and the country decide whether or not, on his particular Gallup poll, this resolution has found favour. As I said in my opening remarks, a great hue and cry has been raised across the country against this particular tax. The resolution ended by saying that all agricultural machinery would be exempt, and all farm buildings or buildings on anyone's property would have to be taxed.
Then on July 8 the minister reduced the tax to 4 per cent, and said, "Catch as catch can". He told the people they can collect from the retailers the other 7 per cent they had paid. He said that if they had bought a house he was sure that the builder would be a good fellow and return the $500 to $1,500 which this 7 per cent tax would represent. But he did not offer, nor did the Department of National Revenue, to see to it that this tax would be returned.


John Richard Garland: Would the hon. member permit a question? Would he mind repeating what he said about the effect of the 11 per cent tax?


John (Jack) Henry Horner: If I recall my remarks I said that the 11 per cent would amount to between $500 and $1,500 on the average house purchased since June 13, and if the minister would like to dispute that I will be glad to listen to him.


John Richard Garland: I think the hon. member realizes he is in error there.


John (Jack) Henry Horner: No, I had not realized that. I was informed of that by my constituents. If a person bought a house for $7,000, then 11 per cent would be well over $700. That is it in a nut shell. This has happened to constituents of mine who produced the figures and facts. They have been charged $700 on a $7,000 house. I told them they would get that back and they asked me how. I said I would look into it and try and find the
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proper way. But I am sorry to say that I have not been able to ascertain for certain how this particular constituent of mine will get back in excess of $700 tax paid, owing to the indecision and the retreating change of mind of the Minister of Finance.
We talked of indecision in the April 8 election campaign. This country has never seen 90 days of more indecision and mumbling and more state of influx of the economy. As the Leader of the Opposition stated, there was a statement made by the United States government some time ago about a pat on the head at Hyannis Port, and a kick to the Canadian economy. We have received more kicks to the economy in the last 90 days than we have ever received at any time in past history.


John James Greene: What about the "state of influx"?


John (Jack) Henry Horner: The constituency of Renfrew South is in a state of influx. We have heard talk about home construction in this resolution, yet two or three days before the budget the Minister of Labour stated that $500 would be given to new home construction started in the winter time. Everybody thought: "Oh boy, this is a real handout". It had nothing to do, of course, with the statement of the leader of the government in today's Globe and Mail, in which he referred to no more give-aways. He summarized the theme of the April 8 election in one sentence, and I want to repeat it because it is a good one to repeat often to those now embarked upon give-aways of one sort or another, to undo the harm they did with the other hand, one might say. He said:
I do not think we should spend a nickel after the election unless it contributes to the expansion of the economy.
In what way does $500 toward home construction in the wintertime offset this tax of something like $700 on a home, whether it is built in the winter or the summer? In what way does $500 on a home built in the wintertime compensate for construction in the wintertime? I have received many telegrams opposing this gift of $500 toward home construction. What does it do? It does not offset this tax. According to the Minister of Labour's own admission in this house it does not do that. What it does is to take $500 off the value of every home already built, and it taxes those same home owners so as to pay for the $500 the government is willing to give new home builders in the wintertime.
This business of the right hand giving one thing and the left hand taking a little more back, Mr. Chairman, certainly reminds an old farmer like myself of driving two balky horses and getting nowhere-one trying to go ahead

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and one back. I am sure many hon. members, particularly the Minister of Agriculture, have witnessed or endured the task of trying to get somewhere with a team of horses like that. I suggest to the Liberal party that they should get together to get rid of the balky horses, because one cannot have an economy which will grow and provide all the jobs needed by the people who are newly entering the labour force unless everyone is pulling together and every measure introduced is designed to secure a better growth rate in Canada-a rate of growth even faster than the 8 per cent we had in 1962. It may be that the dismal efforts in these resolutions account for the minister not forecasting an increase of more than 5 per cent during the present year, but I hope Canadians will have enough faith in their country to invest in it and enable our gross national product to grow fast enough to absorb those who are added to our labour force every day.
The minister has reduced this tax from 11 per cent to 4 per cent.


Eldon Mattison Woolliams: No. He has not reduced it. He has amortized it.


John (Jack) Henry Horner: The minister has tried to clear up certain of these definitions. I know that many items of interest to agriculture are taxed, as things now stand, but I hope the definitions will be further clarified and that the taxes can be reduced in the months ahead. Agricultural buildings and all buildings put up by non-profit organizations should be exempt. Church buildings as well as schools and universities should be exempt. Certainly, we should not tax the generous gifts and donations made to these worthy institutions. We should at least move in the direction of allowing such things as these to grow and flourish. There is a place in Canada for churches, religions and libraries. We should be big enough to allow them to be free of the particular building tax which is now proposed.
The minister may sit and smile about his conceited ideas as to how Canada should grow. I have not written any book on how it should grow but I have had some definite ideas. We see in Time magazine that even the Prime Minister at one time questioned his great economic adviser, the Minister of Finance. He asked him: "Have you lost confidence in yourself?" The minister replied: "No, I have taken so many knocks during my 57 years that I can take one more". Well, the hon. gentleman has taken a good many knocks since June 13. I do not want to be the final straw or anything like it, but I do wish to say that the committee should give serious consideration to measures such as this which

will hinder or halt the rate of economic growth in Canada, which is so vital to a young country such as ours.
Once again, I would ask this government to correlate its actions and its thoughts. Some time ago we heard a lot of talk about unemployment. Hon. members opposite said it was the primary concern of our country. Well, unemployment seems to have been replaced in these days by balance of payments problems. As I say, I hope the government will correlate its thinking and its actions so that our rate of economic growth is at least as high as it was last year. That is what I look forward to. But I do not think it will come about, and that is why I am strongly opposed to these resolutions.


An hon. Member:: We have gathered that.


John (Jack) Henry Horner: Hon. members over there can laugh and smile. They will have to face the public sooner or later. That is the great thing about politics. Sooner or later they will have to face the music.


An hon. Member:: Not worse than listening to you.


John (Jack) Henry Horner: They can make all sorts of snide remarks, but I believe the public is fully aware of what this tax means. It is a manufacturers' tax which is unwanted and unwarrantable in Canada today.


John Ross Matheson: I do not wish to take up the time of the committee for too long but in view of the amiable remarks of the hon. member for Acadia I feel I should intervene briefly.
I think it is clear that the purpose of this budget is twofold. The first intention is to stimulate the economy, but in order to do this we have to meet the obligations of the country. We, as a party, have to do this whether we want to do it or not. Looking at the white paper, I find, as set down on page 68, that we are now paying 14 per cent by way of public debt charges. Following the interesting series of speeches which were read into the record last night in connection with this matter, I put a question on the order paper. I have not yet had an answer to this question, but the question relates to federal, provincial and municipal debt in Canada and the servicing charges in connection therewith. In addition, it seeks information about private debt in this country.
I am old fashioned enough to think that some day we shall have to pay for these continuing deficits. It would be delightful if we could always be in the position in the business cycle where we could apply

Keynesian deficit financing, but there are many who think that the snap has gone out of the elastic-


An hon. Member:: Why did you make all those promises, then.


John Ross Matheson: I am speaking only for myself and on behalf of my constituents. I earnestly believe we will have to face these debts some time and I am surprised that in the old Conservative party not one voice has been raised since this parliament was called to express concern about whether we shall ever balance our budget.


Some hon. Members:: Oh, oh.


John Ross Matheson: I think I can say without reservation that not one member over there has supported any one of these taxes.


Eldon Mattison Woolliams: On a point of order.


Lucien Lamoureux: The hon. member for Leeds has the floor and he should not be interrupted.


Eldon Mattison Woolliams: I rise on a question of privilege. The hon. member declared that no member on this side has mentioned the question of balancing the budget. I would ask the hon. member to read my speech with reference to the setting up of a department of industry.


John Ross Matheson: I believe I can say that no member of the Conservative party has to date, either in committee or in the house, given active support to any of the taxes proposed in this budget.
None of us likes these taxes. There is not a Liberal member in the house who has not had on his desk letters, telegrams and notes of telephone calls from constituents disturbed by these budget suggestions.


Some hon. Members:: Oh, oh.


John Ross Matheson: We know that, and we know there has been the best-organized lobby in connection with this matter that Canada has ever witnessed on a budget. I just want to say to the hon. member for Port Arthur that my reaction last week end, and the week end before that, was that among a lot of common, ordinary folk in Canada there is a great deal of respect and admiration for this man Gordon.


Some hon. Members:: Oh, oh.


John Ross Matheson: We had quite a sensation in the house when it was first suggested by the two reverend gentlemen over on the extreme left that perhaps there was something dishonest going on, some kind of leak. That was quickly picked up by the leader of the official opposition. The suggestion was that perhaps there was something indecent about the fact
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that people came in to give advice; but that has very quickly gone by the boards.


Paul Raymond Martineau: Mr. Chairman, I think that the hon. member for Leeds is straying from the subject. He is reviving a subject that has been dealt with before, and that is not within the purview of this debate.


John Ross Matheson: The suggestion of impropriety has gone by the boards. Now the suggestion is that the minister is a jackass or does not know where to tax. I am very sorry that any additional taxes had to be imposed.


John (Jack) Henry Horner: So are we.


John Ross Matheson: May I ask hon. members, what is discreditable about placing the equipment and supplies and construction materials industries in precisely the same position as other industries? I wish we could have avoided this tax. It would have helped me very much with some of my friends and constituents. But if a tax has to be imposed, does it not make sense that at least we should deal equitably with all sections of industry? Surely the Conservative party in their economic philosophy must entertain some kind of support for the proposition of maintaining competitive enterprise. Competitive enterprise surely means the interplay of the market forces, supply and demand. Any time we intervene by way of a tax law and make changes to stimulate one sector of the economy as against another, or one area of a sector of the economy as against others, we create some kind of distortion. Surely at times we do that because, as the hon. member for Acadia said, there are areas where such stimulus does in fact do some economic good.
Perhaps it is in the secondary manufacturing sector where there is a large element of labour in relation to production. In these areas, of course, we are deeply concerned about employment. But surely as a basic proposition it makes sense that in our economy we should strive to deal equitably and fairly with all areas. If additional tax had to be imposed, does it not seem just and reasonable that at least the tax gaps should be filled?
I have not heard yet in any of the contributions of Conservative members any suggestion as to where, alternatively, they would have liked the additional tax to be imposed. Is it their proposition that it should have been in the form of additional income tax? Should it be by way of still higher sales tax elsewhere? Should it be in the form of higher tariffs?


Mr. Graffiey:: You are the government.

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John Ross Matheson: We are the government, but I am outside the establishment. I am just a private member of parliament. But I am deeply concerned about the fact that in less than six years we have accumulated deficits in excess of $2.9 billion. It seems to me that at some time we are going to have to pay for these deficits, just as I think that at some time we are going to have to pay for the cost of fighting world war II.
We have heard speeches by the hon. member for Nanaimo-Cowichan-The Islands, the financial critic for the New Democratic party. He spoke very cleverly on this matter. I do not subscribe to his economic theories but essentially they are that we are living in a neo-Keynesian world where we do not have to consider balancing budgets any more. These responsibilities do not enter into his philosophy, which is apparently that we can live in a continual state of deficit financing. Perhaps he does not go quite that far, but the implication is there; and I certainly recall that the leader of the New Democratic party said something very similar. He suggested that respected economic opinion today suggests that we do not need to worry about balancing our accounts any more. I happen to be old-fashioned enough to think we do and that if we actually spend more than we bring in by way of revenue essentially we are in trouble.
The armed forces are an illustration of this. I am not going to digress but I simply wish to give the facts. In the last six years we have actually failed to equip our army, navy and air forces properly. They have tended to fall down and down in the ratio of equipment to manpower. This is what is happening in our economy with regard to replacing our capital, and worse still even to the extent of not meeting our debt obligations.
I do not subscribe to everything Social Credit members say, but they are right in emphasizing the added burden to Canadians of debt charges. These debt charges are growing sharply. Considering our small population, this is a burden, and I am with the Minister of Finance in any form of discipline that needs to be imposed on the Canadian economy to make competitive enterprise more competitive and to allow us to move into the world economy with our heads held high, as I think we must do.
I am not going to carry on further. I do not like this tax. I do not think there is one member on our side who does; but before these deliberations are finished I should like to hear some suggestions from the Conservatives, an old party which I always thought believed in the principle of conserving- "conserving", meaning to save, to keep, to protect, to hold, to husband. I do not see

much sign of that in their economic philosophy, and I should like to see some evidence of it. I should like to see some of their members suggest where and how we are going to conserve Canada for the future along the lines that I think have been indicated by the Minister of Finance.
(Translation):


Mr. Laprise:: Mr. Chairman, I would not like the discussion of the budget resolutions to be concluded without making a few remarks, for, once again, it has been proved that taxes are never popular, so that the 11 per cent tax on building materials, which the Minister of Finance announced in his budget speech on June 13 last, raised such a flood of protest on all sides, that the minister had to make us swallow it in stages.
As far as I am concerned, I received letters and telegrams of protest from all parts of the country, and more particularly from my riding. Anyway, I find myself that the home building industry is the most affected by the new tax, because it directly affects those who were planning to build a home or, as the case may be, to make some renovations.
As that new tax will slow down any new building activity as well as repair work in existing property, construction workers will inevitably find it more difficult to find employment in that industry.
Those who, directly or indirectly, are responsible for the marketing of building materials, as well as those who normally look after their transportation, will also be hit by the tax.
Mr. Chairman, for a number of years we have been facing this serious problem of unemployment, which, instead of diminishing, is getting worse, more particularly in the province of Quebec. As a matter of fact, the last figures which were submitted to us indicate that unemployment has increased in an alarming fashion during the month of June 1963, in comparison to June 1962.
We believe that instead of interfering with the normal progress of the building industry, the government should use appropriate steps, such as fiscal incentives or other means to promote it.
Why discourage those who intended to become home owners in the near future? And why forget the old adage: activity in the building trade is a sign of prosperity?
A great deal was made of the $500 bonus this government intends to grant those who will build during the four less favourable months of the year. Now, Mr. Chairman, I

myself am a construction worker, and I know that it is much more expensive to build during the winter months. As a matter of fact, it is necessary to heat the water and the aggregate for the foundations of new buildings. It is necessary also to surround the house with a temporary shelter to keep out the cold. All this causes additional costs in housing construction, not to mention the fact that the workers do not work in comfort during the winter months. Consequently, this $500 bonus is greatly reduced because of the increased costs of construction.
Mr. Chairman, I also note that this new 11 per cent tax on building materials does more to cancel that bonus than any other tax.
Mr. Chairman, every family is entitled to a decent shelter, and it has been established that he who owns a small plot of land is more eager to defend his country against subversive doctrines, because he owns a share in his country. We need accommodation everywhere. Our cities, villages and rural areas are full of slums that we must plan to replace as soon as possible, because, after all, human beings should be better sheltered than animals.
The area I represent will be seriously affected by this tax, particularly on account of the tornado which hit the region at the end of June with indescribable force, specially in a part of the provincial riding of Abitibi West, spreading death and desolation.
In fact, over 350 farmers in 15 localities suffered losses. Barns, sheds and houses were torn down, and those buildings must be reconstructed.
Last July 3, I asked the Minister of Finance (Mr. Gordon) whether he considered exempting from the 11 per cent sales tax on building materials those who had suffered from that tornado. At that time, he answered that he would have a statement to make on Monday, July 8. After listening to his statement and reading it over, I found in it nothing very encouraging, except for a temporary alleviation on the 11 per cent tax.
We must realize that without assistance, even if they are full of good will, most of them will not be able to recover from the losses suffered because of that tornado.
Mr. Chairman, as can be seen on page 1950 of Hansard, the minister stated:
28902-5-165
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Since the budget was brought down on June 13, the government has received representations and suggestions for changes from members of all parties in this house, and from many people outside.
That means, Mr. Chairman, that there was no lack of suggestions to the Minister of Finance to amend his budget. And we think that it would have been wise for him to consider some of those suggestions which, if carried out, would have allowed him to look forward to larger revenues.
The taxes which we have to pay, and which we cannot get used to, are, after all, levied to get the necessary revenue to cover the various departments' expenses.
The minister of finance of a country holds the key to the administration, and the Minister of Finance of Canada has that key, which is the Bank of Canada. He has the power to use that key, the Bank of Canada, to create an economic climate reflecting the true wealth of our country and, at the same time, to put that wealth to the service of all Canadians. In that way, he would save headaches to other ministers who, I believe, would like to do more but are limited by their meagre budget; they establish their programs according to the amount the Department of National Revenue allows them, while they should have the possibility of establishing programs according to the needs of the country.
The budget has been meeting with such an opposition that the Minister of Finance cannot indefinitely continue to put up with our sick monetary system. He will have to adopt the monetary theory of the Social Credit party, for it is impossible to go on governing the country with taxes and loans as it is done now.
Since confederation we have had 72 budgets showing a deficit. Seventy two out of 96. Those budgets left with us a gigantic debt of $24,182 million, as can be seen on page 124 of the public accounts for 1962-63. That debt will force us to pay this year the amount of $882 million in interest only. That is enough to make us think.
The Minister of Finance should use the Bank of Canada to finance the government's expenses rather than following a policy of taxes and loans. We would thus have a balanced economic policy for all Canadians.
(Text):


Wallace Bickford (Wally) Nesbitt: This afternoon and during the various stages of the budget debate, we have heard quite a number of economic theories. Economic theories, of course, can be varied

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depending, I suppose, upon whether one follows the London school of economics, the Harvard school, the Chicago school or some other school.


Douglas Mason Fisher: And the Leeds school.


Wallace Bickford (Wally) Nesbitt: Yes, as the hon. member for Port Arthur mentions, the Leeds school. A few moments ago the hon. member for Leeds suggested that no one on this side of the house had made any suggestion as to the alternative method the Minister of Finance might have used to raise the necessary funds to cover the government's increased expenses. Well, in a few moments I will be pleased to offer some suggestions to which some consideration might be given. In addition to that, I was rather surprised by the request for suggestions by the hon. member for Leeds because I recall that a few months ago his party was the one that was supposed to have all the answers. This does not seem to have proven to be the case.
This question of deficit financing was mentioned by the hon. member for Leeds. I do not believe this is exactly the place to get into an argument on the economic theories of public finance. However, there did seem to me to be some confusion in the hon. member's mind as to the difference between external debt of the country and internal debt. However, be that as it may, a great deal has been said about this 11 per cent sales tax on building materials. I feel that to date practically everything that could be said has been said, and I do not wish to take up the time of the committee by reiterating what has already been said.
My only comment is that I was interested to hear the Minister of Finance say this afternoon that he had received letters of commendation on this tax. I find that interesting, and I say I am quite sure that none of them came from the part of the country I happen to represent. It is quite true that this sales tax of 11 per cent on building materials has been altered to some degree by the minister and is now being imposed on the instalment plan. I suppose one might refer to that as paralysis of industry by instalments rather than in one fell swoop.
As I said, many comments have been made on this subject and, apart from the fact that I agree thoroughly with the criticism of this tax, that is all I wish to say in that regard.
As I recall it, the Minister of Finance said in one of his speeches that this tax now being imposed on building materials and production machinery was being imposed on these items because they had been exempted to date, and for that reason it was only fair that they be taxed. This was the implication I gathered

from the minister's remarks. On the face of it, if one has to raise additional revenue, it sounds very reasonable; but it is not as reasonable as it sounds.
The building and secondary manufacturing industries have not paid this tax over the years, and as a result have become adjusted to not paying it in relation to the rest of the economy. To use the ordinary term, they are what might be called vested interests and have become adjusted to our taxation system as it existed until now, and of course to our various customs tariffs.
The economy could be likened to a pile of bricks. If you pull out two or three of the important and largest bricks you disturb the whole pile and all the others have to readjust themselves into a new heap. If you start shifting around one or two of the major props to the economy this has effects and ramifications all through the economy, and by changing the tax structure with respect to these industries you unsettle the whole economy.
Secondary industry, which is the type we must depend on for further development of the economy, has had a bit of a boost during the last year or two, largely as a result of the revalued dollar, both with respect to imports and the developing export business. However I feel I must ask the minister for some clarification of what secondary industry will pay in the form of this new taxation. There is already a great deal of confusion in secondary industry, and if the hon. member for Kootenay East does not object I should like to quote from two letters with respect to the tax.
The letters are from two very large secondary industries, in one case from the general manager and in the other from the owner. One is a machine tool industry which employs close to 1,000 people, and I might say in passing that all industry is not located in Montreal or Toronto, as we are sometimes led to believe in this house. The other is a large manufacturer of automobile parts and aluminum tubes.
The first letter is from Standard Tube and T.I. Limited in Woodstock, and it says in part:
Our company is constantly in competition with United States on fabricated tubular products, particularly in the automotive industry. On many occasions, equipment and tooling involved for Canadian production is costly and the imposition of 11 per cent sales tax may well cause us to lose potential business. In effect, imported parts are now given a substantial cost advantage over Canadian made parts.
In conjunction with other automotive parts manufacturers, we have recently entered into certain reciprocity contracts involving export of materials to the United States. Here again, the 11 per cent sales tax now represents an extremely serious obstacle to the furtherance of such badly needed export business.
Already we have been obliged to review our capital outlay budget. Of necessity, certain items

must either be cancelled or delayed as the additional tax involved on production machinery causes us to exceed original and approved estimates.
The other letter is from Mr. Harold Wilson, who is general manager, and I believe principal owner, of the Morrow Screw and Nut Company Limited, which is a very large machine tool company. He says:
I feel the situation as regards the 11 per cent sales tax is going to be not only intolerable but very disastrous to our industry. As I think I said before, any increase in our costs can only be reflected in loss of the new export market which we have begun to develop and even greater losses in our own domestic market. In connection with our parent organization, the Ingersoll Machine and Tool Company, it would appear that we may be faced with the loss of major portions of our steering gear business as the automobile manufacturers compare our prices against laid down prices from their own American plants, and naturally an increase in our price is going to swing the balance towards importation.
I have investigated carefully the clause which seems to re-establish the exemption on materials expended in production. Although at first this was thought to represent some improvement, on more careful study this would appear to be not too great an improvement. As we read the paragraph the exemption is only applied to materials, which I gather are raw materials, which are expended in manufacturing operations. It would appear that this exemption does not apply to other expendable items such as perishable tools. This item of perishable tools alone is one of our most severe manufacturing expenses. The application of the tax to this alone will add a very severe burden to our cost structure. I feel that it is necessary for industry to be supplied with a very careful directive advising how this exemption is or is not applied and to what. The word 'material" just is not good enough to cover all the ramifications of this question.
There seems very little doubt that the imposition of this tax on production materials and machinery used in manufacturing will have a very serious effect on our balance of payments.
In regard to this question of our balance of payments there is one way in which matters could be assisted, and I refer to the question of travel in the wintertime to the West Indies. I think increased subsidies on air fare would help this, and it would certainly help our balance of payments if the commercial banks in Canada were advised to recommend the purchase of travellers cheques in Canadian funds instead of American dollars, to people visiting countries other than the United States. This is something which could be done in every branch of every bank.
I think everybody will agree with the minister when he said he felt it was necessary to try to raise additional funds to help balance the budget. No one would seriously disagree with that objective, but it is a question of how he might have gone about it. As I recall it, he outlined in his budget speech certain alternatives to which he had given some consideration. One that I recall 28902-5-1651
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was an across the board increase in income tax, an increase generally in sales tax, and the like. These various suggestions were cast aside by the minister and his advisers as being unsuitable. I would agree with the minister's decision on that. I think increased taxes in these fields would have done more harm than good and, as I say, I have no quarrel with that decision. But I would have thought the minister and his assistants might have explored a little more thoroughly some other source of revenue or perhaps a combination of certain other sources of revenue.
I would say at this point, Mr. Chairman, that the suggestions I should like to place before the minister for his consideration are my own personal suggestions. There may be others who will disagree with me, but for what they are worth I would like to suggest them. In the first place, I would have thought an increased tax on alcohol, or liquor, might have been a very good source of revenue. There is a fairly inelastic demand for liquor, and although people might not like it very much, I do not think many would seriously object if an extra 25 cents or 50 cents tax per bottle were levied.


John Whitney Pickersgill: Mr. Chairman, does the hon. gentleman mean that an extra 50 cents should be added to the price of a bottle of beer?


Wallace Bickford (Wally) Nesbitt: Mr. Chairman, I would hope the Secretary of State would know better than that, and I am sure he does. I was referring to alcohol-


John Whitney Pickersgill: I am asking a question.


Wallace Bickford (Wally) Nesbitt: -or spirits. I said, a bottle of liquor. If the Secretary of State does not know the difference between a bottle of liquor and a bottle of beer, I would suggest that he inquire of some of his colleagues. To make it very clear, I am referring to a 25 cents or 50 cents levy on a bottle of whisky, gin, rum or other commodities generally known as spirits. I am told that a tax imposed at the rate of 25 cents a bottle would bring in aproximately $25 million a year. If this figure is not correct, I would be very glad to be corrected. If the increase were 50 cents a bottle, it might come close to $40 million or $50 million a year, due to, perhaps, some decrease in consumption.
I do not think an increased excise tax on tobacco would produce very much revenue, in view of the advertising campaign of the Minister of National Health and Welfare with regard to smoking. Also, inasmuch as there is a reasonably elastic demand for cigarettes, I do not think an increased tax would bring much additional revenue to the treasury.


Walter Lockhart Gordon: That would be discrimination.

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Wallace Bickford (Wally) Nesbitt: I suggested a tax on spirits. I would think-


Mr. Roxburgh:: Mr. Chairman, could I ask the hon. member a question?


Wallace Bickford (Wally) Nesbitt: Certainly.


John Maxwell Roxburgh: Is the hon. member in favour of increasing the tax on tobacco?


Wallace Bickford (Wally) Nesbitt: If the hon. member had been listening, he would have heard very well what I said. I have just pointed out that no benefit would be derived from placing an increased tax on tobacco; the treasury would get no more money, and it would be very inadvisable. I hope I have made myself clear this time. I was not, like the hon. member opposite, trying to cut off loans to farmers under the Farm Credit Corporation. Mr. Chairman, I should like to return to the suggestion I placed before the minister for bringing more money to the treasury. I think increased income taxes at some levels might have been considered by the minister, in combination with the other taxes I have been suggesting.


Mr. Pennell:: Mr. Chairman, would the hon. member be specific and give us figures?


Wallace Bickford (Wally) Nesbitt: Mr. Chairman, I am not in the least interested in hearing the comments of the hon. member for Brant-Haldimand. As the hon. member for Leeds was asking for suggestions, I am merely trying to accommodate him and pass on a few. Some hon. members opposite do not wish to hear these suggestions; nevertheless, I am going to continue. There is another method which I think might commend itself to the minister. It is perhaps a different or unusual source of tax revenue. This would be, to evolve a method -and I am sure the minister and his associates could devise some means of doing this -to try and shake loose some of the large funds held by insurance companies, for the purchase of common stocks. As I recall it, insurance companies can invest 15 per cent in common stocks. In the United States they are allowed to invest 25 per cent, but it is 15 per cent in Canada. The information I have is that only 4 per cent of these investments are at the present time in common stocks; the rest are in bonds, mortgages and first mortgage bonds which, compared with good common stocks, have a relatively low rate of return.
If means could be devised-and there are always good tax ways of doing these things -to encourage the loosening up of these funds for investment in common stocks, this would have a threefold effect. First of all, insurance companies have hundreds and hundreds of millions of dollars available for investment, and if this suggestion were put

into effect it would undoubtedly increase the extent of Canadian ownership in Canadian industry. This would be a very good thing in the long run, of course, for our balance of payments problem, in particular with respect to exporting dividends abroad. Second, the increased returns to the companies holding these stocks would provide a higher rate of profit and the Minister of National Revenue would be able to collect more corporation tax. Third, another effect would be that with an increased ownership by these companies of Canadian common stocks, the dividends would be paid into Canadian companies and would be taxable, instead of going abroad and being subject only to the 15 per cent tax.
There are one or two questions I would like to put to the Minister of Finance, and perhaps the Minister of National Revenue, for clarification. Many people are uncertain in this regard, and I have not been able to obtain any clarification on just what goods used in manufacturing and production are to be taxed. Does this apply to such things as sulphuric acid, hydrochloric acid and various solvents used in industry? In some cases these commodities can be used several times. Are these things to be taxed? These are questions manufacturers in secondary industry would like to have answered. My second question is with regard to such items as saws, drills and various pieces of machine tools that are used up in the manufacture of other tools. There is still a great deal of confusion in this regard and perhaps before the resolutions are passed we will obtain some clarification from one of the ministers I have mentioned. I think this would bring back a great deal of confidence on the part of these industries. One of the problems is not so much that they have to pay a tax, because if they have to pay it, they have to pay it; but some of these companies would like to know what they have to pay the tax on. This doubt has created a great deal of delay in planning in secondary industry, which will be very detrimental to our economy. If the Minister of Finance or the Minister of National Revenue could clarify these matters, it would be very helpful indeed.


Mr. Mackasey:: Mr. Chairman, in the few short moments left at my disposal I would like to say a few words on the budget resolutions. There are times in this house when I feel very much alone, in view of the fact that I am the only manufacturer of printed material, as far as I am aware, in the House of Commons. Hon. members can well imagine the volume of telegrams and representations that I receive from representatives of the graphic arts industry. There are times, too, when I envy the lawyers-and we seem to

have a preponderance of them in the house -because they seem to know just where to put the commas and the semicolons in these resolutions. But as a manufacturer I think I have some knowledge of the implications of the budget resolutions because they concern me very much in the very small business of which I am proud to be president.
When the minister originally introduced his budget he left unanswered a lot of questions in the minds of hon. members, and that goes for the backbenchers on this side of the house as well as members on opposition benches. But subsequently at various stages I think he has cleared up many of these unanswered questions. For instance, the question is asked why, instead of increasing taxes on production machinery he did not increase the income tax. To that question he answered that in his opinion it would have required too drastic an increase to get the required result. He also checked into the possibility of raising the excise tax where applicable to 12 or 13 per cent, but came to the conclusion that again this would hurt the average Canadian. He also investigated the possibility of raising corporation taxes, but found that this obvious source of revenue had been taxed to its capacity. If I am not mistaken he mentioned cigarettes and alcohol, but came to the conclusion that there again further taxation would only result in diminishing returns. The idea of taxing insurance as advocated by the hon. member for Oxford would no doubt result in an increase in insurance premiums which the average Canadian would be called upon to share. I think the danger into which we are falling at the moment, and one I suppose which the Minister of Finance cannot do anything about, is that we are discussing a budget resolution by resolution and forgetting the effects of the budget, good and bad, in the over-all picture.
I should like to deviate from my notes, because time is short, to mention one or two specific things which have occurred in my riding in the last few days. I was called Saturday to discuss with a manufacturer who was contemplating cancelling an order for $150,000 worth of production machinery. This was because of the 4 per cent tax. On the surface I could hardly blame him because he had contemplated buying this machinery before the increase in the budget and was faced with the expense of finding an extra $6,000. When I spoke to his chartered accountant and the board of directors and investigated the accelerated depreciation which was now at the disposal of this manufacturer, he turned to the vice president in charge of purchasing and said: "We have a fixed contract for a portion of our equipment which will not be subject to the 4 per cent. I want
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you to phone up Monday and have this fixed contract broken because I want to pay my 4 per cent so that I can take advantage of accelerated depreciation on all the equipment I am going to buy".


Michael Starr: Would the hon. member permit a question? How did the person he was talking about know that the area in which his plant was to be located would be a designated area by the government for the purpose of this depreciation?


Bryce Stuart Mackasey: Mr. Chairman, I have read the bill perhaps a little closer than the hon. frontbencher on the other side has. In my opinion the accelerated depreciation has nothing to do with depreciated areas, the areas of high unemployment, which benefit from tax relief provisions, as I understand it. As a matter of fact, I think the Minister of Finance pointed out last night that this particular manufacturer I am talking about is not even obligated to take the accelerated depreciation immediately, if it is not in his best interests.
Another manufacturer is anticipating a sizeable order, and if he is successful in his tender this going concern is investigating the possibility of moving a small company to Amherst, Nova Scotia, so as to take advantage of an area which is considered one of aggravated unemployment, and thus obtain the tax holiday. That is another example of the way the budget is helping small industry. I have personally-and I think this is the duty of every hon. member, once he goes home and forgets party politics-found jobs in the last few months for at least 75 people in my riding who are over 45. I received the help of the unemployment insurance commission, and found jobs for people whose unemployment insurance benefits will have run out by the time the winter months set in. As we know, small companies are being encouraged by the grant of a subsidy of, I think, up to $75 a month to hire people over 45. In most cases I have found that those companies which depend on climatic conditions, such as snow removal companies, garbage companies, fuel oil companies, and dry cleaning companies, which are affected detrimentally in the summer and normally find their peak season in the winter, and require extra help, have in previous years customarily taken youngsters who should be at school because they can get them for a small sum, and make them do small clerical jobs around the office, answer the telephone or fill fuel oil orders. By making this personal canvass in my area I have found jobs for a lot of people, mostly in these small fuel oil firms; and while this may not contribute an awful

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lot to our unemployment problem, it is very important that somebody helps people out of work. This is one way in which we can help.
In summing up, Mr. Chairman, while it is the prerogative of the house to scrutinize minutely every stage of the budget, I think in all fairness to the Minister of Finance we should look at the budget as a whole, objectively, take advantage of the provisions for accelerated depreciation and the tax holiday, and accept the fact that basically this is a good budget for Canada.


Mr. Fane:: Mr. Chairman, I have half a minute left to discuss the things I intend to discuss, so would the committee permit me to call it six o'clock.


Some hon. Members:: Agreed.


Herman Maxwell Batten: It being six o'clock, shall I rise, report progress, and request leave to sit again at the next sitting of the house?


Some hon. Members:: Agreed.
Progress reported.



BUSINESS OF THE HOUSE

Mr. Churchill:: I presume the house leader will tell us that we will go on with the present resolution tomorrow. Supposing we finish it, has he anything else to suggest?


John Whitney Pickersgill: Yes, sir, I have. We will go on with these resolutions and if they are completed I intend to ask the unanimous consent of the house to proceed immediately with the bills. I hope that might be forthcoming, but I am not asking for that now. We would also take the bill respecting the surcharges and the economic council, and I would think that that would probably occupy us most of the day. If perchance we have a little time in the last hour of the day we could perhaps occupy it with the transport estimates.
As for Friday, I should like to confer with hon. gentlemen opposite before I try to forecast any business for that day.


[Stage Direction]
It being two minutes after six o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Thursday, July 25, 1963