1963-07-15

Hon. Lionel Chevrier (Minister of Justice):: Mr. Speaker, I rise on a question of privilege. On Friday the hon. member for Winnipeg North Centre (Mr. Knowles) rose on a question of privilege, as reported at page 2121 of Hansard, which I think I can summarize. I quote:
My point of privilege is that what we now have is precisely what we had last June. We have the government construing that the Financial Administration Act or regulations made under it gives them authority to do something which the act itself says cannot be done. The Financial Administration Act says that no appointments by the treasury board can be made under it.
The hon. member's statement in this respect is not correct. If hon. members would look at section 5(2) of the Financial Administration Act they would find it provides that the governor in council may authorize the treasury board to exercise all or any of the powers, other than powers of appointment, of the governor in council under the Civil Service Act, the Civil Service Superannuation Act, the Defence Services Pension Act, and parts II to VI of the Royal Canadian Mounted Police Act.
The action taken was not under any of the foregoing acts, nor was it an "appointment". Section 39 of the Financial Administration Act authorizes the governor in council to make regulations with respect to the conditions under which contracts may be entered into, and it was pursuant to these regulations that the contracts were made. Section 5(2) of the Financial Administration Act has no application whatever to the present situation.



MR. KNOWLES  MOTION FOR REFERENCE TO

[Stage Direction]
COMMITTEE OF SESSIONAL PAPER 39b
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, on the question of privilege may I suggest that what I indicated on Friday was that the opinion in the name of Mr. Driedger tabled by the Prime Minister indicated that though it was purported that these arrangements were made under the government contracts regulations in accordance
with section 39 of the Financial Administration Act, they do not come within the terms of the government contracts regulations themselves, as Mr. Driedger himself pointed out.
It seems to me that since we have had a question of privilege and a counter question of privilege raised in connection with the subject, the matter should be gone into. I therefore move, seconded by the hon. member for Burnaby-Coquitlam:
That sessional paper No. 39B be referred to the committee on privileges and elections for study and report.


Mr. Speaker:: I appreciate the remarks of both hon. gentlemen, but I am sure the house will realize that I should like to study the matter a little more thoroughly to make sure there is a prima facie case. Perhaps the house would agree to let me reserve further remarks until tomorrow, and the mover of the motion could let the motion stand until then.


Stanley Howard Knowles: I will be happy to let the motion stand as notice until Your Honour has considered the matter.



MISCELLANEOUS PRIVATE BILLS

[Stage Direction]
Third report of standing committee on miscellaneous private bills-Mr. Wahn.


Hon. A. J. MacEachen (Minister of Labour):: Mr. Speaker, hon. members will be interested to learn that I am today tabling the report of the industrial inquiry commission appointed to investigate and report on the disruption of shipping in the great lakes and the St. Lawrence river system. The schedule of this report will be tabled later when it is printed.
Hon. Mr. Justice Thomas G. Norris was appointed an industrial inquiry commission just over a year ago to carry out this investigation. As hon. members know, he has conducted an exhaustive inquiry into a very difficult situation, and merits the thanks of all Canadians for the painstaking public service he has given at much personal inconvenience to himself.
Officials of my department and of others will be examining the report and its recommendations to see what further action may be necessary. It has been arranged that hon.
2168	HOUSE OF
Dominion-Provincial Conference members will be receiving copies of the report from the queen's printer as soon as possible. Copies are also being released to the parties concerned, and to the press.

On the orders of the day:


Hon. Michael Starr (Ontario):: Mr. Speaker, I should like to address a question to the Minister of Labour based on his announcement of the tabling of the Norris commission report. If I understood him correctly he said that the interested parties and the press would receive copies of the report now but that members of parliament would receive them as soon as possible. Could an effort be made so that members of parliament might receive copies simultaneously with the press?


Allan Joseph MacEachen: Mr. Speaker, I think the words "as soon as possible" were unfortunate. My understanding was that copies would be available to all hon. members as soon as the announcement was made in the house. I hope they are in the letter boxes now.



DOMINION-PROVINCIAL CONFERENCE TABLING OF LETTER SUGGESTING MEETING ON JULY 26-27

Right Hon. L. B. Pearson (Prime Minister):: Mr. Speaker, I should like to table copies in English and in French of letters which were mailed last Friday to the premiers of the provinces, in which I have suggested it would be valuable to hold an early and preliminary federal-provincial meeting, and I have proposed July 26 and 27 as possible dates for such a meeting.
I should like to inform the house, because it has a bearing on this invitation, as to the government's intentions regarding the conference and the business of the house which is related to it. If a conference can be held on the dates suggested the government will not propose to proceed this week or next week with the second reading of the bill designed to promote employment by financial assistance, in the form of loans with provincial approval, to enable municipalities to augment or accelerate their capital works programs.
The government plans to proceed with the bill during the week following the conference, that is the week of July 29, which could be the last week before the house adjourns. This is legislation which it is urgent to have in force soon so the municipalities can plan their work for this winter with knowledge of the financial assistance for which their representatives have repeatedly asked and which the government believes to be desirable for the encouragement of employment. By proceeding with the bill in two weeks time we


will be acting with the necessary urgency, and we will at the same time make it possible to incorporate in the bill any changes which, in the light of the federal-provincial discussions, the house may think desirable.
At this preliminary conference, Mr. Speaker, the federal government proposes that there should also be discussion of another matter of common interest to Canada and to the provinces, namely pensions. In order to facilitate these discussions it is the government's intention to move on Thursday of this week the resolution concerning legislation for the Canada pension plan. At that time the Minister of National Health and Welfare will give to the house a fuller statement about the government's proposal. There will thus be available the information required for discussion of pension policy by the house, by the public generally and by the provincial governments at the proposed meeting.
It will be the government's intention also to consider with the provinces at this preliminary meeting arrangements for a federal-provincial conference later in the year. This meeting will provide for full discussion of fiscal arrangements and other matters which are of common interest to the provinces and to Canada.


Right Hon. J. G. Diefenbaker (Leader of the Opposition):: Mr. Speaker, the announcement by the Prime Minister that consultations will now take place with the provinces in respect particularly of the anticipated legislation concerning municipal loans, is one that should have been made before the legislation was introduced at all. Consultation with the provinces does not take place when a government decides on a course and places legislation on the order paper; and then when objection is raised by a premier or premiers, however powerful they may be, the government finds that it must retreat from a position previously taken. However, I suppose consultation, whether early or late, ought to be welcomed as evidence on the part of the government that it realizes now it was in the wrong when it proceeded as it did.
Second, with regard to the pension legislation, I suggest that if there is any need of co-operation on the part of the provinces then the government might consider doing something that has been generally requested by old age pensioners across Canada. If there is any question as to the degree to which this legislation can be implemented without provincial assistance and co-operation; if there is any difficulty in that connection, it has been widely suggested that the government might bifurcate this bill and introduce immediately the provision for the $10 per

month increase in the old age pension. Then, in view of the ever increasing cost of living, the old age pensioners would not have to wait until autumn or until next winter.
However, in summary I say that repentance is good for the soul, and the government having decided on consultation, something that was suggested by hon. members in the official opposition, that is naturally appreciated even though it is late.


Mr. R. N. Thompson (Red Deer):: Mr. Speaker, regarding the announcement which the Prime Minister has just made to the house, 1 believe he and all of us realize that if there could have been the proper consultation with the provinces before these resolutions were introduced he probably would have avoided the problems which are being faced right now. There is certainly a great deal of urgency in regard to the municipal development and loan fund legislation, and I am sure if the provinces are permitted to carry out the regulations under the resolution which the government has placed before us there will be co-operation from all the provinces.
There is also a certain amount of urgency in regard to the national pension scheme. It relates to the portability of pensions and to the financial arrangements. Again we must realize, particularly at this point in the history of Canada's development that none of these things can be carried on without complete consultation with the provinces, which we in this party trust will come about as a result of the conference which the Prime Minister has called.


Mr. T. C. Douglas (Burnaby-Coquitlam):: Mr. Speaker, I am sure that members of this group will welcome the Prime Minister's announcement that a meeting with the premiers is to be held to discuss the municipal development and loan fund legislation. This legislation was introduced with great fanfare. The municipalities were told how much this would help them in solving the unemployment problem and planning their work for next winter. It is, therefore, most important that it be passed as early as possible.
It is a great pity that there was not consultation with the provinces prior to the introduction of this legislation, but I do want to compliment the Prime Minister on stating that after the conference with the premiers has been held he does intend to proceed, and he is not going to allow any obstruction to be placed in the way of proceeding with legislation which is highly desirable and greatly needed in this country.
I am sure the Prime Minister does not want the 60 days of decision to be followed
Dominion-Provincial Relations with 60 days of derision, and this is what will happen unless this important piece of legislation is proceeded with at an early date.
With reference to the pension legislation, we in this group have been urging for some time that if there is going to be any delay in proceeding with the legislation-and we hope there will be the minimum of delay- certainly the government can have no fears at all about proceeding with the $10 a month increase in the old age security pension. That at least would be an interim step, and there is no reason for it to wait until constitutional problems have been worked out with the provinces. So far as this group are concerned we would be prepared to proceed on that basis, by separating the increase in the old age security pension from the Canada pension plan.
[Editor's note: For text of letter above referred to, see appendix "A".]

On the orders of the day:


Stanley Howard Knowles: Mr. Speaker, may I direct a question to the Prime Minister. The purpose of my question is to seek clarification of the welcome announcement he made that the resolution in respect of the Canada pension plan would be called on Thursday of this week. When he made the announcement he said the Minister of National Health and Welfare would set out all the details of the plan, and that leads to this question. Is it the intention to have just the speech of the minister, or will the debate on the resolution continue with a view to having that debate concluded and the bill introduced and given first reading?


Lester Bowles Pearson: It is the intention of the government to arrange proceedings so that the minister will have an opportunity to tell the house our views on this matter, and I would hope that the same day the party leaders would have an opportunity to express their views on the statement made by the government. The future procedure with regard to this matter will have to depend on the progress made in connection with other matters.



DOMINION-PROVINCIAL RELATIONS MUNICIPAL LOAN LEGISLATION    TABLING OF QUEBEC RESOLUTION AND LETTER

Lester Bowles Pearson: Mr. Speaker, I wish to table copies in English and French of a letter addressed to me on July 11 by the premier of Quebec concerning Bill No. C-76.

D.E.W. Line Stations


John George Diefenbaker: Would the Prime Minister agree to have it printed as an appendix to Hansard.'!


Lester Bowles Pearson: I see no reason why it should not be, if the house is agreeable, and I think perhaps the other letter I have just tabled should be printed in Hansard as well.


Mr. Speaker:: Is it agreed?


Some hon. Members:: Agreed.
[Editor's note: For text of documents above referred to see appendix "B".]



NATIONAL DEFENCE


Hon. Paul Hellyer (Minister of National Defence):: Mr. Speaker, in 1955 Canada and the United States signed an agreement for the establishment of the distant early warning line on Canadian territory as part of a comprehensive North American control and warning system. This agreement was announced in the House of Commons on May 20, 1955.
Recently the United States government suggested to the Canadian government that a reappraisal of the effectiveness of the D.E.W. line indicates that certain adjustments may be made in the equipment configuration and still provide acceptable early warning. The new configuration would permit the discontinuance of 28 of the smaller D.E.W. line stations.
The Canadian government has agreed to the United States government's plan and the necessary arrangements are being made by the authorities of both governments. The affected facilities will be disposed of in accordance with existing agreements between the two governments.
Twenty intermediate D.E.W. line stations located in Canada, and eight in Alaska, will be closed. Approximately 123 Canadian and 60 United States citizens will be affected by this action. They are employees of the Federal Electric Co., Paramus, New Jersey, which has a United States air force contract for the operation and maintenance of the D.E.W. line.
{Later:]
On the orders of the day:


Hon. W. G. Dinsdale (Brandon-Souris):: Mr. Speaker, I should like to direct a question to the Minister of National Defence arising out of his statement on the D.E.W. line changes. Could the minister inform the house if those changes took into consideration the diminishing bomber threat?


Paul Theodore Hellyer: No, Mr. Speaker, but I know that because of the portfolio he previously held
[Mr. Pearson.)
my hon. friend will be interested to hear that every effort is being made to use the facilities as constructively as possible.


Hon. D. S. Harkness (Calgary North):: Mr. Speaker, I should like to direct a question to the Minister of National Defence consequent upon the statement he made earlier about the D.E.W. line stations. Can the Minister inform the house how many D.E.W. line stations will remain in operation in Canada after the suspension which he has mentioned?


Paul Theodore Hellyer: No, Mr. Speaker, I cannot give that figure.


Douglas Scott Harkness: May I ask the minister why he cannot give the figure? The total number of stations in existence has been given on many occasions, and if the minister knows what the figure was he should be able to tell us how many are left.


Paul Theodore Hellyer: The immediate reason I cannot give it is that I cannot recall it.



AGRICULTURE


Hon. Harry W. Hays (Minister of Agriculture):: Mr. Speaker, I wish to inform the house that the agricultural stabilization board has been authorized to continue to provide support to producers of sunflower seed for crushing. Support for the 1963 crop will be provided by a deficiency payment program, the support being set at 4.22 cents per pound for Canada No. 1 grade, 10 per cent moisture, sunflower seed of the 1963 crop, basis delivery at the crusher. This support is 100 per cent of the base price, which is the average price received by farmers over the previous ten years, and is the same level as was in effect for the 1962 crop.



FINANCE


Mr. E. J. Benson (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, on
behalf of the Minister of Finance, with the permission of the house I should like to table information promised the hon. member for Pontiac-Temiscamingue (Mr. Martineau) in answer to question No. 614. 1 refer hon. members to page 1484 of Hansard of June 24, 1963.



QUESTIONS

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

Mr. MacEwan: Has the Minister of Transport received a submission from the board of trade of Pictou urging sufficient rail installations on new pier C at Pictou, Nova Scotia and, if so, what action does the government intend to take in this regard?


Mr. Mcllraiih:: Yes. The question is being examined by the departments of public works and transport and will be decided as soon as possible.


BELLA BELLA AND KLEMTU INDIAN COMMUNITIES, B.C.  HOUSING EXPENDITURES
Mr. Howard: For each fiscal year since April 1, 1960, how much money was spent for housing purposes in the Indian communities of (a) Bella Bella and (b) Klemtu (Kitasoo), and how many new houses were built in each such community?


Mr. Munro:: (a) Bella	(b) Klemtu
	Bella	(Kitasoo)
1960-61	$ 14,786.29	nil1961-62	10,714.00	$ 2,700.001962-63	12,072.09	2,746.00New houses 1960-61	7	nil1961-62	4	11962-63	4	1AIR TRANSPORT BOARD SUBSIDY POLICY


Mr. Fisher: 1.	Is the air transport board satisfied that Transair Limited is not suffering a monthly operating loss on its recently acquired prairie runs and, if not, has the air transport board given consideration to recommending a subsidy to Transair currently or as soon as the cumulated losses reach the value of the equipment and parts given Transair by T.C.A.?
2.	What is the policy of the air transport board in assigning or awarding air line passenger franchises where the revenue anticipated cannot meet the operating costs?
3.	Does the air transport board know whether the carriers which previously serviced these routes, or parts of them, suffered operating losses or gave evidence that they did and, if so, what was the scale of these losses for each carrier by year over the past five years?


George James McIlraith: 1. The matter of subsidy to Transair Limited has not been considered. The route is being operated in a different manner from the former operation, and any future requirements would have to be assessed on the basis of operating experience.
2.	Applicants for licences must meet the criterion of public convenience and necessity or public interest, depending on the class of licence applied for. The economic feasibility of the operation is a relevant factor in the board's consideration of such applications. The board considers that a completely new service should have a reasonable prospect of
Questions
at least meeting out of pocket costs in the initial stages, and that there should be reasonable prospect in the long run that the service will be fully self sufficient.
3.	Yes, the board is aware that carriers which previously served the prairie runs suffered operating losses although detailed financial evidence was not submitted by T.C.A. in its application to abandon the south prairie route. Pacific Western Airlines Limited operated the north prairies route at a loss, and was in receipt of a government subvention of up to $25,000 per month. The board does not know the amount of losses specifically attributable to the route as it is now operated.


SALE OF PLANES AND PARTS BY T.C.A. TO TRANSAIR
Mr. Fisher: 1.	Is it the practice when a crown corporation sells equipment or parts to a private organization for the revenue received to be in the public domain?
2.	If not, what reasons were developed to support this secrecy?
3.	If so, why does T.C.A. not reveal what revenue it received from the sale or exchange of planes and parts with Transair Limited?


George James McIlraith: 1. and 2. In the operations of Trans-Canada Air Lines equipment is bought and sold in accordance with normal commercial practice. Purchase or selling prices are not a matter of public record.
3. Funds derived from the sale of aircraft and parts are not revenue and are recorded in the company's financial returns as recovery of capital.


PARLIAMENTARY GUIDE
Mr. MacRae: 1.	Does the government of Canada purchase copies of the Parliamentary Guide each year and, if so (a) how many copies (b) at what price per copy?
2.	Have any representations been made concerning the accuracy of this publication?


Mr. Pickersgill:: 1. (a) By direction of treasury board, orders for the Canadian Parliamentary Guide are submitted to the national librarian for approval. The national librarian approved the purchase of 854 copies of the 1962 edition and 934 copies of the 1963 edition.
(b) List price of the 1962 edition was $6 per copy; price of the 1963 edition was $7 per copy.
2. No information.


COMMUNITY PASTURES, MANITOBA
Mr. Slefanson: 1.	How many community pastures have been established under the P.F.R.A. program in the province of Manitoba since June 21, 1957, and (a) where are they located (b) what is the area in acres and (c) the cost of each?

Questions
2.	What community pastures are at present under development in Manitoba, and for each what is the (a) area in acres (b) number of cattle that can be pastured (c) cost of each and (d) when will each be in operation?
3.	When and where were meetings held with local residents to discuss these proposed community pastures, and who were the government officials in attendance?


Mr. Beer:: (a) Location	(b) Area	(c) CostCote-San Clara	Togo, Saskatchewan	8,320 acres	$ 60,248.12(Saskatchewan-Manitoba as one unit)	(b and c-Manitoba portion only)	Dauphin-Ethelbert	Ukraina, Manitoba	23,400 acres	$126,851.00Gardenton	Gardenton,	Manitoba	12,560 acres	$ 74,944.83McCreary	McCreary,	Manitoba	71,820 acres	$258,934.98Turtle Mountain	Boissevain,	Manitoba	23,870 acres	$146,399.91Wallace	Virden, Manitoba	10,240 acres	$ 65,207.98(d) YearExpected to	be in2.	(a) Area	(b) No. of Cattle	(c) Cost	OperationPasquia, The Pas, Manitoba	16,600 acres	4,000 to 5,000	$180,000	1965Narcisse, Narcisse, Manitoba	31,360 acres	2,200 to 3,000	$161,400	1964Lenswood, Lenswood, Manitoba	30,800 acres	2,000 to 3,000	$136,700	1964Pansy, Pansy, Manitoba	9,440 acres	1,000 to 1,500	$ 99,000	1964Mossey-River-Ethelbert,	3,000 to 4,000	$191,500	1964Ethelbert, Manitoba	69,920 acres	
3. No meetings have been held as yet with local residents nor are any contemplated until construction has been completed, at which time meetings will be convened lor the purpose of organizing community pasture grazing associations. Meetings to date have been confined to those held with municipal and provincial officials.


PAROLES DENIED BECAUSE OF SUPERVISION LACK
[Stage Direction]
Question No. 835
Mr. Matheson:: 1.	Are paroles from penitentiaries, provisional gaols, reformatories, training centres and industrial farms now being (a) denied or (b) deferred or (c) cancelled or (d) revised because of inadequate supervision facilities?
2.	If the answer to any of the above is in the affirmative, what proposals, if any, does the government have to remedy this situation?


Mr. Macdonald:: 1. (a), (b), (c) and (d). Parole supervision is, at the present time, a shared responsibility of field officers of the national parole service, of staff members of provincial probation services and of case workers of private after care agencies. There exists a scarcity of trained and experienced personnel. Paroles, therefore, have at times been deferred or delayed or sometimes denied either for lack of supervision facilities at the proposed point of release or because the existing facilities are not adequate to provide appropriate counselling or surveillance.
2. The problem is receiving attention.


* CANADIAN FORCES FOR UNITED NATIONS
Mr. Knowles: 1.	Has Canada made a specific offer to the United Nations to turn over thereto part of Canada's armed forces and, if so (a) on what date or dates was any such offer made (b) what were its terms (c) what has been the response of the United Nations to any such offer (d) are there any communications between Canada and the United Nations on this subject and (e) can they be produced?
2.	Does Canada maintain a stand-by battalion or other unit or units available to the United Nations at any time and, if so, what battalion or other unit or units have been so designated?
3.	Has the United Nations been advised of the availability of such a battalion or other unit or units and, if so (a) are there any communications relating thereto and (b) can they be produced?


Mr. Martin (Essex East):: 1. (a), (b), (c), (d) and (e). No general offer has been made to turn over to the United Nations elements of the Canadian armed forces. At the time of the Korean conflict and the Suez crisis offers of a military contingent were made. For the most part, personnel units and equipment from the Canadian armed service have been provided in response to specific requests from the United Nations, the most recent being in connection with the peace keeping operation in Yemen. No communication in regard to the general availability of Canadian armed forces has been made to the United Nations, but the Canadian position is known to the United Nations.

2.	Yes. At present the stand-by unit is the first battalion, Royal 22nd Regiment.
3.	(a) and (b). The United Nations has not been formally advised about the availability of the Canadian stand-by battalion but this arrangement has been a matter of announced Canadian policy which has been expressed in the house and on public platforms from time to time, and is known to the United Nations.


CAPE BRETON HIGHLANDS PARK
Mr. Muir (Cape Breton North and Victoria): Did Mr. Albert Boudreau of Point Cross, Inverness county, apply for employment this season at the Cape Breton Highlands national park and, if so (a) what are his qualifications (including experience) for such work and (b) for what reasons was Mr. Boudreau not reemployed?


Mr. Turner:: (a) General labour, including duties as clean up man in camp grounds (five years experience).
(b) Seasonal positions had been filled before Mr. Boudreau indicated his interest in further employment.
research personnel for members of


PARLIAMENT
Mr. Knowles: Questions
1.	Is consideration being given by the government to the provision of research personnel for the private members of the House of Commons?
2.	If so, when will such provision become effective, and to what extent?
3.	If not, will the matter now be given consideration?


John Whitney Pickersgill: Mr. Speaker, there is no specific consideration being given by the government at the moment to any definite plans for additional research assistance to members, but the matter is viewed sympathetically by the government and perhaps could be a matter to be raised on the estimates for the house.


CONTRACTS WITH OUTSIDE CONSULTANTS, FINANCE DEPARTMENT
Mr. Knowles: 1.	Have the contracts entered into with Mr. D. C. H. Stanley, Mr. M. P. O'Connell and Mr. G. R. Conway, under treasury board minute T.B. 610618, dated May 2, 1963, and with Mr. R. J. Anderson, under treasury board minute T.B. 610952, dated May 17, 1963, been terminated?
2.	On what date did each of the above commence his service with the Department of Finance?
3.	On what date did each of the above terminate his service therewith?
4.	What was the total amount of money paid to each of the above as travelling expense, per diem living allowance, and per diem fee?


Edgar John Benson: 1, 2 and 3. Yes.
Mr. D. C. H. Stanley Mr. M. P. O'Connell Mr. G. R. Conway Mr. R. J. Anderson
Commenced April 22, 1963 April 22, 1963 April 21, 1963 May 7, 1963
Terminated June 20, 1963 June 20, 1963 July 1, 1963 May 16, 1963.
4.	Although the respective claims have not all been settled, it is expected the totals will be approximately as follows:
Mr. D. C. H. Stanley, travelling expenses, $52.65; per diem living allowance, $1,500.00.
Mr. M. P. O'Connell, travelling expenses, $25.15; per diem living allowance, $1,500.00.
Mr. G. R. Conway, travelling expenses, $507.16; per diem living allowance, $1,487.50; per diem fee, $3,250.00.
Mr. R. J. Anderson, travelling expenses, $50.00; per diem living allowance, $225.00.


ARTIFICIAL COLOURING IN FOODS
Mr. Knowles: 1.	Has the Department of National Health and Welfare made a recent review of the regulations concerning artificial colouring permitted in foods or food products and, if so, what particular foods or food products have been studied?
2.	Has it been determined that the proportion of artificial colouring allowed in any such foods or food products should be reduced, and for what Teasons?
3.	Is action being taken, either by the proposing of legislation or by amending the appropriate regulations, along these lines and, if so, what action?


Mr. Haidasz:: Yes, the food and drug directorate of the Department of National Health and Welfare has during the past year been reviewing the food colour regulations. This review has encompassed all food colours and all uses that are permitted under the current regulations.
2.	The directorate is considering a reduction in the current maximum permissible level for added synthetic colours in food, which now is equivalent to 286 parts per million, in order to minimize any possible hazards to health from these compounds.
3.	Proposed amendments to the food colour regulations were circulated in 1962 to the industries concerned and have, in conjunction with proposed regulations for food additives since been under further study in the

Questions
department. Amendments to the food colour regulations are expected to be promulgated within the next few months.


COST OF CANADIAN NORAD COMMITMENTS
Mr. Douglas: What was the cost or what is the estimated cost, to Canada for carrying out our commitments under (a) NORAD (b) NATO, in the fiscal years (i)
1960-	61 (ii) 1961-62 (iii) 1962-63 (iv) 1963-64?


Paul Theodore Hellyer: (a) Canada has no direct financial commitment to NORAD. The direct costs of the air defence forces in Canada are estimated as follows:
Fiscal Year: (i) 1960-61, $156,212,000; (ii)
1961-	62, $182,127,000; (iii) 1962-63, $171,846,000; (iv) 1963-64, $138,734,000.
(b) Estimated direct costs of Canadian forces committed to NATO:
Fiscal Year: (i) 1960-61 $408,916,000; (ii) 1961-62, $455,545,000; (iii) 1962-63, $465,129,000; (iv) 1963-64, $415,598,000.
Note: Air defence cost as shown above are the estimated direct expenditures on the R.C.A.F. forces assigned to the air defence of the Canada-U.S. region. These figures do not
include indirect costs such as training, logistics suport, command and administration.
NATO costs as shown above consist of the direct costs of the army brigade and the air division in Europe, the R.C.N. and R.C.A.F. forces earmarked for SACLANT and direct expenditures on mutual aid including contributions to infrastructure and NATO budgets. These figures do not include indirect costs of the type referred to in the previous paragraph.


COST OF CANADIAN UN COMMITMENTS AND EXTERNAL AID
Mr. Douglas: What was the cost or what is the estimated cost, to Canada for carrying out our commitments under (a) the UN (b) the Colombo plan (c) other forms of aid to underdeveloped countries in the fiscal years (i)	1960-61 (ii) 1961-62 (iii) 1962-63 (iv)
1963-64?


Mr.   Marlin@Essex East: 
DAYLIGHT SAVING TIME
Mr. Malher: Is the government giving consideration to the possibility of establishing, in consultation with the provinces, daylight saving time on a national basis?


Mr. Benidickson:: There is no move on the part of the federal government to establish daylight saving time on a national basis.


FEDERAL CONTRIBUTIONS TO CROP INSURANCE
Mr. Gauthier: What amount has the Department of Agriculture contributed for crop insurance in all the Canadian provinces since its inception up to March 31, 1963, and, of this amount, what part has been allotted to the province of Quebec?


Bruce Silas Beer: Federal contributions made to the provinces to March 31, 1963 under the Crop Insurance Act amount to $700,978.
No contribution has been made to Quebec since this province does not operate a crop insurance program under agreement with Canada.


EXPERIMENTAL FARMS
Mr. Gauthier: How many experimental farms does the Department of Agriculture operate in Canada and, of these, how many in the province of Quebec?


Bruce Silas Beer: Apart from the research branch headquarters establishment in Ottawa, and two national research institutes located elsewhere in Ontario, the Department of Agriculture operates 39 research stations and experimental farms, six of which are located in the province of Quebec.

Questions


AGRICULTURAL LABORATORIES
Mr. Gauthier: How many agricultural laboratories does the Department of Agriculture own in Canada, and, of these, how many in the province of Quebec?


Bruce Silas Beer: There are 21 agricultural laboratories operated by the Department of Agriculture in Canada and of these two are located in the province of Quebec.


INTERNATIONAL DRIVING PERMITS
Mr. Mather: 1.	What provinces have accepted the United Nations 1949 convention on road traffic regulations respecting international driving permits?
2.	Has the federal government made representations to provincial authorities with regard to the acceptance of this convention and, if not, will the government consider making such representations?


Mr.   Marlin@Essex East: 1. Appropriate ministers of the following provinces have indicated that they see no serious objection to Canadian accession to the 1949 United Nations road traffic convention:	Alberta, British
Columbia, Manitoba, New Brunswick, Nova Scotia, Ontario, Prince Edward Island, Quebec and Saskatchewan.
2.	Yes.


DEFENCE EXPENDITURES
Mr. Malheson: 1.	What percentage of (a) navy (b) army and (c) air force expenditures have been devoted to equipment in each of the years since and including 1955?
2.	What is the total expenditure for defence in each of these years, and what proportion of the annual gross national product does it represent?


Paul Theodore Hellyer: Percentage of total expenditures by navy, army and air force devoted to equipment.
1. Fiscal year Navy Army		Air force
1955-56	41.6 20.4	46.01956-57	44.4 11.9	27.11957-58	37.9 7.1	30.91958-59	29.8 9.7	35.81959-60	22.7 6.8	27.01960-61	18.8 7.3	26.91961-62	22.5 6.5	28.51962-63	22.8 6.4	21.32. Calendar	Defence	Percentageyear	expenditures	of G.N.P.(NATO Definition)	($000)	1955	1,819,000	7.61956	1,888,000	7.11957	1,828,700	6.51958	1,740,000	6.01959	1,641,800	5.41960	1,653,600	5.31961	1,716,000	5.31962	1,810,000	5.2[Mr. Beer.)	
Note: NATO definition includes defence expenditures by D.N.D. and defence expenditures by other federal government departments.


BREAKWATER REPAIRS, FELTZ SOUTH, N.S.
Mr. Crouse: Is it the intention of the government to call in 1963 tenders covering the extensive repairs to the breakwater at Feltz South, Lunenburg county, Nova Scotia?


Mr. Badanai:: This matter is being studied but it is too soon to say when tenders will again be called.


LION'S HEAD, ONT. POST OFFICE
Mr. Loney: Has the Department of Public Works been requested by the Postmaster General to acquire lands for a post office building in the village of Lion's Head, Ontario, and, if so (a) what progress has been made (b) when will tenders be called?


Hubert Badanai: No. (a) Not applicable, (b>
not applicable.


FEDERAL ASSISTANCE TO HONG KONG
Mr. Dinsdale: 1.	Since 1957, how much assistance has been given by the government of Canada to Hong Kong in the form of (a) powdered milk (b) canned meat and (c) butter oil?
2.	Is it the intention of the government to continue this program and, if so, what contributions will be made during the current year?


Paul Joseph James Martin: 1. None of the commodities mentioned has been given to Hong Kong under Canada's regular bilateral aid programs. In 1962, however, the following foodstuffs were made available to Hong Kong by the government of Canada, at a cost of approximately $485,000, through Canadian relief agencies with established channels of distribution in Hong Kong:	(a) powdered
milk, 840,700 pounds; (b) canned meat, 1,995,570 pounds; (c) butter oil, nil.
2. The above commodities were provided for emergency relief purposes. The Canadian government has no continuing program for the provision of foodstuffs to Hong Kong.


DAMAGE TO WOLFE MEMORIAL, PLAINS OF ABRAHAM
Mr. Dinsdale: 1.	What damage was done to the Wolfe memorial on the plains of Abraham during the recent disturbances?
2.	Has the damage been repaired and, if so, what was the cost of the repairs to the treasury?


John Napier Turner: The national battlefields commission advises as follows:
1.	Toppling of the column; chipping of column and stone base.
2.	Not yet.


TORTURE OF GERMAN SPIES BY CANADIAN TROOPS
Mr. Mather: 1.	Has the government information as to the accuracy of reports that three former nazi espionage agents assert they were tortured by Canadian troops in the Netherlands in 1944?
2.	Is the government considering investigating such reports?


Paul Theodore Hellyer: 1. Available records contain no reference to the alleged incident.
2. No.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. Marlineau: 1.	What are the joint programs at present being carried out by the federal government with one or more of the provinces?
2.	For each of such program, what is (a) the name or number of the statute, order in council, regulation or other authority under which such program is being carried out (b) the date of the adoption of such statute, order in council, regulation or other authority (c) the sums of money expended for each such program by the federal government since the commencement of the program, giving the amount for each fiscal year?
3.	What further joint programs does the government intend to carry out with one or more of the provinces during the current fiscal year?


CANCELLATION OF TENDER CALLS
Mr. Valade: 1.	Has the government cancelled any calls for tenders since April 8, 1963, and, if so, which tenders, in which departments, and on what grounds?
2.	If not, is it the intention of the government to change the tender calling procedure in certain departments, particularly in the Department of Defence Production?


CONTRACTS WITH FULLER CONSTRUCTION CO., OTTAWA
Mr. Orlikow: 1.	How many contracts has the Fuller Construction Company of Ottawa received from government departments and agencies in the past six years; what were these contracts, and what was the value of each contract?
2.	Have complaints been made that this company has not been observing the federal government's wage and hour regulations and, if so, how many?
3.	How many of any such complaints have been investigated, and what were the results of these investigations?


CONTRACTS WITH H. J. MACFARLAND CO., OTTAWA
Mr. Orlikow: 1.	How many contracts has the H. J. MacFarland Construction Co. of Ottawa received from government departments and agencies in the past six years; what contracts were these, and what was the value of each contract?
2.	Have complaints been made that this company has not been observing the federal government's wage and hour regulations, and, if so, how many?
Orders jor Returns
3.	How many of any such complaints have been investigated, and what were the results of these
investigations?


REPORT OF COMMITTEE ON MANITOBA'S ECONOMIC FUTURE
Mr. Fisher: 1.	Has any minister of the crown been presented with the report of the committee on Manitoba's economic future and, if so, which ministers, and what form of communication accompanied the report?
2.	Has an analysis been made of the recommendations in the report that bear upon matters falling within the federal jurisdiction (e.g. Indian problems, Churchill harbour) and, if so, has this analysis been forwarded to any cabinet or departmental committee for action or recommendations?
3.	Has any response been sent to the provincial government regarding this report, or to the committee itself?
4.	Have any ministers of the crown and/or any deputy ministers, met with the chairman and the executive board of the committee to discuss the report and any assistance the federal government may give to achieve the recommendations of the committee?


POST OFFICE DEPARTMENT SALARIES
Mr. Valade: Have the salaries of the employees of the Post Office Department been increased since 1949 and, if so (a) in what years was each such increase granted (b) what was the amount of the increase in each case, by classification of worker?


PERSONS POSTED OR MADE AVAILABLE TO MINISTERS, ETC.
Mr. McIntosh: 1.	Have any members of the civil service, public service, or any federal government employee of any government department or crown corporation been seconded, attached, transferred, posted or loaned to the Prime Minister's office, privy council or to any minister's office or to any minister's personal staff since April 22, 1963, and, if so, what are their names, location, responsibilities, salary, date duties commenced, name of immediate supervisor, and the name of department to which their position is established?
2.	Have any persons other than federal government employees been made available in any capacity to the Prime Minister's office or to any minister's office or as part of the minister's personal staff since April 22, 1963 that have been in receipt of government monies by means of salary or expense account funds and, if so, what are their names, date duties commenced, location, responsibilities, name of previous employer and amount of federal moneys in any form received to date?
3.	Have any persons other than federal government employees been made available in any capacity to the Prime Minister's office, privy council or to any minister's office, or to any minister's personal staff since April 22, 1963, who may or who may not, have been in receipt of government monies and who have had access to or have used government equipment, materials, stores, supplies, including privileged, classified and internal governmental information, correspondence and files and, if so, what are their names, nature of duties, date duties commenced, name of previous employer, and location?

Inquiries of the Ministry PUBLIC SERVICE



INQUIRY AS TO SALARY INCREASES FOR CERTAIN CLASSES

[Stage Direction]
On the orders of the day:
Mr. H. A. Olson (Medicine Hat):: Mr. Speaker, last week, I think on Monday, the Minister of Finance said that he and the cabinet were considering or would be working on the matter of pay increases for certain categories of the public service that have not as yet been granted increases. I wonder whether the minister could inform the house and those public servants who are anxiously waiting whether any decision has been reached respecting pay increases.


Hon. Waller L. Gordon (Minister of Finance):: Mr. Speaker, a decision has been reached respecting the increases for the civil servants in group D. The government believes that the staff associations are entitled to be the first to be informed of the details of the increases agreed to. This procedure will, of course, be essential as soon as the systematic procedure for collective bargaining has been introduced, and I hope the house will consider that this is a move in the right direction. The committee of the cabinet that has been dealing with this matter is planning to meet with the staff associations this evening or late afternoon and inform them of the details of the increases, on the understanding that the public announcement will be held until tomorrow morning.
(Translation):


Hon. Azellus Denis (Postmaster General):: Mr. Speaker, I wish to add a few words to the statement just made by the Minister of Finance.
When postal employees in group D are given pay increases under the continuing salary review, the only ones who do not receive an increase are those in the following categories, who are paid out of revenue and whose salary rates are established by the Postmaster General as authorized by the Post Office Act.
1.	Postmasters-Semi-staff post offices, groups 31 to 34;
2.	Assistants 1 and 2-Semi-staff post offices;
3.	Postmasters-Revenue post offices, groups 1 to 30;
4.	Postmasters-Sub post offices.
(Text):
These employees will have their salaries adjusted at the same time as those who are paid out of appropriations. The increase will be proportionate to that granted the classes paid from appropriations. The effective date will be the same as for group D.


Stanley Howard Knowles: A supplementary question to the Minister of Finance, Mr. Speaker. In view of the reference in the welcome statement he has just made to the subject of collective bargaining, can the minister say whether legislation carrying out this commitment of the government will be introduced at this session?


Walter Lockhart Gordon: Mr. Speaker, there is a very considerable amount of work to be done which has to be discussed with the staff associations before the details of a collective bargaining system can be introduced. This is already under discussion, and one of the things I hope to do tonight when talking with the staff associations is to have further discussions about the way in which this can best be furthered and expedited. I think it very unlikely that this work can be done in time to have the legislation ready for this session.


Horace Andrew (Bud) Olson: A supplementary question to the Minister of Finance. I certainly understand the suggestion that the staff associations should be informed first, but I wonder if there are any of the public service groups within the categories he mentioned who will not be included in these pay increases. If he thinks this would not prejudice or hamper his discussions with the staff associations-


Some hon. Members:: Oh, oh.


Walter Lockhart Gordon: Everybody included in group D will be dealt with in the announcement which will be made to the staff associations this evening. There are one or two other groups, including the staff of the house, which will be dealt with by Your Honour's committee, I am sure at a very early date, now that the main recommendations have been made. The increases for the people I have just referred to are kept in line with the general increases and can now be dealt with.



TRANS-CANADA HIGHWAY BRITISH COLUMBIA-INQUIRY AS TO SECOND HIGHWAY

[Stage Direction]
On the orders of the day:
Hon. Marcel Lambert (Edmonton West):: have a question for the Prime Minister. Did the right hon. gentleman, on Friday last, meet with a delegation of the trans-Canada highway system Yellowhead route association. If so, can he tell the house whether it is the government's intention to implement in 1963 the pledge which he made earlier this year to make a definite start on a second trans-Canada highway?


Lester Bowles Pearson: I met with a delegation on the day referred to by the hon. member, and the Minister of Public Works will be making a statement on this matter either tomorrow or the next day.



SASKATCHEWAN


[Stage Direction]
On the orders of the day:
Mr. Reg Cantelon (Kindersley):: I have a question for the Minister of Trade and Commerce. In his absence I hope the parliamentary secretary will consider it. I believe that recently the minister had a letter from the Kindersley and Verendrye wheat pool committees which said in part:
In view of the fact that order No. 1,000 has been rescinded at 12 bushel quota points, farmers will not, under certain circumstances, be able to haul their grain to elevators of their choice.
My question is, would the minister have order No. 1,000 reinstated as soon as possible at any point where it is not now operative?


Mr. Jean-Luc Pepin (Parliamentary Secretary to Minister of Trade and Commerce):: There is nothing I should like to do better than answer the hon. member's question, but it is not an appropriate one for me to handle and, therefore, I shall have to bring it to the attention of the minister.



EXTERNAL AFFAIRS


[Stage Direction]
On the orders of the day:
Robert Norman Thompson: I wish to direct a question to the Secretary of State for External Affairs. I regret I have not had an opportunity of giving him prior notice. In view of the statement by the chairman of the organization of American states on Saturday in Ottawa, as reported in the press, that Canada can now confidently be expected to join the O.A.S. in the near future, can the minister inform the house just how near in the future Canada will be joining this organization?


Paul Joseph James Martin: I am sure the house will share with me satisfaction at the visit of the president of the organization of American states who happens to be the newly accredited ambassador of Costa Rica to Canada resident, for the time being, outside the country. During the course of the ambassador's visit a number of matters were discussed, but in accordance with the usual practice it would
28902-5-139
Inquiries of the Ministry not be appropriate for me to reveal publicly the nature of discussions between a visiting ambassador and a minister of this government.


Mr. H. W. Herridge (Kootenay Wesi):: Would it be fair to say that the government has enough unsettled problems on its hands at present without launching out in further directions?


Mr.   Marlin@Essex East: It would be appropriate for me to observe that this government, while it has much to do, largely by way of a legacy, nevertheless does not propose to shirk any of its responsibilities.


Mr. G. L. Challerlon (Esquimall-Saanich):: Can the minister give the house an assurance that before making a decision as to membership in the O.A.S. the government will refer this matter to the external affairs committee?


Mr.   Marlin@Essex Easl: I cannot give that assurance in the terms in which the question is put. I can only say that when this government feels the moment is opportune, in the light of all considerations, it will decide what policy it should pursue. Having done that it will take the house into its confidence.



HUNGARY


[Stage Direction]
On the orders of the day:
Mr. J. H. Horner (Acadia):: Mr. Speaker, I should like to direct a question to the Secretary of State for External Affairs. Is the government considering granting Hungary diplomatic recognition?


Hon. Paul  Marlin@Secrelary of Slale for Exlernal Affairs: I did not get the hon. member's question.


John (Jack) Henry Horner: Is the government giving consideration to granting Hungary diplomatic recognition?


Mr.   Marlin@Essex East: There is no Canadian mission in Budapest at the present time.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Marcel Joseph Aimé Lambert: wish to address a question to the Secretary of State for External Affairs or to his colleague the Minister of National Defence. Can the house be advised whether Canada and the United States have reached agreement in principle on a pact with respect to nuclear arms, as reported in today's press?

Inquiries of the Ministry


Hon. Paul  Marlin@Secrelary of Stale for External Affairs: The Prime Minister has already indicated in his statement on July 10 the progress which is being made in this regard. I can say that an agreement with the United States making available nuclear warheads for the Canadian forces has not yet been signed. The fact that signature has not yet taken place must not be misconstrued, however. When the signatures have been affixed an announcement will be made, in accordance with the Prime Minister's statement of July 10 and consistent with security regulations.


Marcel Joseph Aimé Lambert: Is the minister indicating at the present time that such an agreement will be signed without prior reference being made to this house?


Mr.   Marlin@Essex Easl: The hon. member will have to read the answer I gave a few moments ago.



REQUEST FOR REPORT ON ACCIDENTS AT CAMP GAGETOWN AND IN YUKON

[Stage Direction]
On the orders of the day:
Hon. Gordon Churchill (Winnipeg South Centre):: I have a question for the Minister of National Defence. I should like to ask whether he has any information for the house concerning the fatal accident which occurred during army exercises at Camp Gagetown just the other day. May I ask the Minister of Justice also whether he has any information concerning the fatal accident to members of the Royal Canadian Mounted Police in the north country. Both the army and the Royal Canadian Mounted Police are serving their country well, and perhaps the house would like some information with regard to these serious accidents.


Paul Theodore Hellyer: In regard to the most unfortunate tragedy at Camp Gagetown, I do not think there is anything I could usefully add to the information which has already been made public. I am sure all hon. members of the house regret that in the course of their training those who serve their country so well and who help us to maintain our freedom do take risks which sometimes lead to tragedy and its resulting bereavement of close relatives and friends.


Lionel Chevrier: In answer to the question which has been raised by the hon. member for Winnipeg South Centre, I have to report unfortunately and with great regret that a Beaver aircraft stationed at Whitehorse, Yukon, crashed at Carmacks at eight o'clock on July 13, 1963, instantly killing four members of the force and a prisoner. Some details of the accident

are given here in the report which I have in my possession, together with the names of those who lost their lives.
Like my colleague the Minister of National Defence I should like to tell the house how sorry I am that an accident under these circumstances should have taken place, and to extend to the parents of these members of the Royal Canadian Mounted Police the sincere condolences of the minister.


Thomas Clement (Tommy) Douglas: May I ask the Minister of Justice-


George James McIlraith: I wonder if with the
consent-


Thomas Clement (Tommy) Douglas: -if the family of the prisoner who was killed will receive some compensation or have some provision made for them by the government?


Lionel Chevrier: Mr. Speaker, I think that would depend a great deal on the circumstances surrounding the accident. I saw that my colleague was about to rise, and perhaps it was to say that an investigation is being conducted. Before I could answer that question I would have to have the report from the air transport board as to the conditions under which the accident took place.



INQUIRY AS TO CREDIT TERMS FOR RED CHINA

[Stage Direction]
On the orders of the day:
John (Jack) Henry Horner: I wish to address a question to the Prime Minister, in the absence of the Minister of Trade and Commerce. My question stems from a report in this morning's Gazette that wheat shipments to red China have been discontinued and that port authorities at Vancouver say shipments are at a standstill. It appears that from this article the Chinese are asking for easier credit terms on further wheat shipments. In view of the economic consequences which could follow, particularly in the province of Alberta, if there were no further wheat shipments, is the government prepared to allow easier credit terms to this country so it can continue to buy Canadian wheat?


Lester Bowles Pearson: Negotiations in connection with this matter are proceeding. The hon. member must know that to make public the terms of negotiations on our side, now, would not be the way in which to bring them to a successful conclusion.


John (Jack) Henry Horner: I do not want the Prime Minister to disclose the terms of the negotiations. All I asked him to say was whether the government is prepared to make easier credit terms available.


Some hon. Members:: Oh.


John (Jack) Henry Horner: The right hon. gentleman could answer yes or no.


Horace Andrew (Bud) Olson: There appears to be a profusion of speculation concerning these negotiations which are going on with mainland China, and I was wondering whether the Prime Minister could inform the house whether the government has arranged for some planned and controlled leakage in order to keep fostering these speculations. If not, where do these speculations arise?


Lester Bowles Pearson: I am afraid I cannot satisfy the hon. member's legitimate curiosity as to where all this speculation arises.



AIRPORTS


[Stage Direction]
On the orders of the day:
Mr. R. W. Prittie (Burnaby-Richmond):: should like to direct a question to the Minister of National Defence. I have not given him notice, but the hon. gentleman is aware of this situation. Will the minister report to this house on allegations made by the aircraft owners and pilots association of British Columbia to the effect that a hangar valued at $200,000 at Boundary Bay airport has been sold to an employee of the Department of National Defence for $500?


Paul Theodore Hellyer: I have no direct knowledge of this matter. I have asked the officials of my department to look into it. If in fact the hangar was disposed of it would have been done by the Crown Assets Disposal Corporation, which comes within the responsibility of my colleague the Minister of Defence Production.


Robert William Prittie: Mr. Speaker, I wonder if the Minister of Defence Production would undertake to investigate the matter I raised earlier with the Minister of National Defence concerning the Boundary Bay airport?


Hon. C. M. Drury (Minister of Defence Production):: I would be glad to take up that question.



BROADCASTING


[Stage Direction]
On the orders of the day:
Mr. L. J. Pigeon (Jolielte-L'Assompiion-Montcalm):: I should like to put a direct
question to the Secretary of State. Will the minister comply with the request of the 28902-5-1391
Inquiries of the Ministry C.B.C., who wish an investigation into the operation of broadcasting in Canada?


John Whitney Pickersgill: I know of no such request having been made to the government.


Thomas Clement (Tommy) Douglas: Last week I asked whether the government would give early consideration to recommending to the house the setting up of a special select committee on broadcasting. I wonder if the Prime Minister has had any time to come to a decision on this matter, and whether he is prepared to make such a recommendation.


Lester Bowles Pearson: My hon. friend the Minister of Justice, who dealt with this matter last week, has been discussing it with me and I hope to be able to make an announcement very shortly.



AGRICULTURE


[Stage Direction]
On the orders of the day:
Mr. F. J. W. Fane (Vegreville):: Mr. Speaker, I have a question for the Minister of Agriculture. In view of the news report carried in the Ottawa Journal of Saturday July 13 to the effect that the farmers of western Canada no longer have the privilege of arranging loans on their farm stored grain through the Canadian wheat board, may I ask the minister whether this statement is true and, if it is correct, when this privilege was removed?


Harry William Hays: Mr. Speaker, I will take notice of the hon. member's question.



REPORTED OUTBREAK OF SCRAPIE DISEASE IN ALBERTA

[Stage Direction]
On the orders of the day:
Harry William Hays: Mr. Speaker, on Friday last the hon. member for Bow River asked if it was the intention of the Department of Agriculture to order the destruction of flocks of sheep infected by scrapie disease, and if it was intended to compensate the owners of the flocks.
The sheep disease, scrapie, has been confirmed on two premises in southern Alberta. All sheep on both premises have been ordered slaughtered under the authority of the Animal Contagious Diseases Act. Scrapie is a disease believed to be of virus origin affecting the central nervous system, and to prevent its spread in Canada all flocks in which the disease is found are slaughtered. The owners will be paid compensation at market value as determined by a valuation committee.

Inquiries of the Ministry Mr. Eldon M. Woolliams (Bow River): A
supplementary question, Mr. Speaker. I should like to ask the Minister of Agriculture if the persons in Alberta who will receive payment for the loss of sheep are the same persons or the same family of persons who received $100,000 from the previous Liberal government?


Harry William Hays: Mr. Speaker, I suppose it Is all right to disclose the names of the people who own these flocks that have scrapie. The flocks are those of Mr. P. G. Rock and Harold Trentham, and I believe Mr. Rock was the recipient of compensation because of scrapie a few years ago. I might say that scrapie is a serious disease, and that at that time there were some 30 flocks affected and some 12,000 sheep destroyed under the slaughter policy.



TURKEYS


[Stage Direction]
On the orders of the day:
Harry William Hays: Mr. Speaker, in order that there may be no misunderstanding I wish to clarify the reply I gave to the hon. member for Wellington South on July 11 in answer to a question by him concerning the quotas on United States turkeys entering Canada. In my answer I made reference to a meeting with turkey producers, and I should emphasize that these were Canadian turkey producers and that I have not met with United States agricultural officials to discuss this question.
In 1962 and for several years prior to that turkeys were supported under the Agricultural Stabilization Act by a deficiency payment program. As yet this year no such program has been authorized, and I was referring to this when I indicated that the representatives of the turkey producers were satisfied with the present arrangement. I should, however, have indicated that the question of import quotas on turkeys is a matter of government policy, and that the government has not yet given consideration to this matter.



INQUIRY AS TO ESTABLISHMENT OF COLLECTIVE FARMS

[Stage Direction]
On the orders of the day:
Mr. S. J. Korchinski (Mackenzie):: I should like to direct a question to the Minister of Agriculture. In view of reports is the minister able to say whether consideration is being given to the establishment of collective farms?



REQUEST FOR EXTENSION OF CONDOLENCES ON DEATH OF H. H. HANNAM

[Stage Direction]
On the orders of the day:
Robert Norman Thompson: May I
direct a question to the Minister of Agri-
culture. Will he convey the regrets of the members of this house to the family of the late Mr. H. H. Hannam and to the members of the Canadian Federation of Agriculture, an organization which he served so long and so well?


Harry William Hays: The answer to the first part of the question is yes; this has already been done. In so far as the second part is concerned, we will look after it right away.
(Translation):



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. Marcel Lessard (Lake St. John):: Mr. Speaker, since my question deals with the industry, finance and labour departments, I shall direct it to the Prime Minister. In view of the proposals intended to assist the underdeveloped areas of the country, could the Prime Minister tell the house what are the criteria on which the government will base itself to decide whether one area rather than another is underdeveloped?
(Text):


Lester Bowles Pearson: Mr. Speaker, I could not, of course, do that on the orders of the day even if it were in order, but there will be legislation dealing with the matter when the question of criteria can be discussed, as indeed it was discussed on the legislation concerning this matter introduced by the previous government.



ROYAL CANADIAN MOUNTED POLICE


[Stage Direction]
On the orders of the day:
Mr. Joseph Macaluso (Hamilion West):: Mr. Speaker, I have a question for the Minister of Justice. In the light of the report I read in the Hamilton Spectator of Saturday, July 13, 1963, that the government has received a report from the R.C.M.P. regarding the Butterworth letter, is it the intention of the government to make the report public in order to clear the ambassador's name and that of his government from allegations made by members of the official opposition?


Lionel Chevrier: Mr. Speaker, I do not know that it is the practice to make these reports public, but I can say rather summarily what the report did contain.
The investigation revealed first of all that there is no evidence that either of the two machines in use by the ambassador's office

at the embassy of the United States of America in Ottawa was used to execute any portion of the questioned typewriting. Next, there is evidence to indicate that the paper comprising the covering letter and its envelope are products of an English firm. Finally, there is no evidence to indicate that the original of the photo copy was a composite or montage, but photographic techniques used in its preparation could obscure such evidence.


Mr. M. J. Moreau (York-Scarborough):: Mr. Speaker, I have a supplementary question for the Minister of Justice in view of his reply to the question raised by the hon. member for Hamilton West. Is it the government's intention, in view of remarks made earlier in the house regarding the Butter-worth letter, to ask for a public apology from the hon. member for Winnipeg South Centre (Mr. Churchill)?



APPEAL BOARD TO DEAL WITH SECURITY RISKS

[Stage Direction]
On the orders of the day:
Horace Andrew (Bud) Olson: I should like to ask the Minister of Justice if he can report any progress on the matter of setting up a board or a means of appeal for persons classified as security risks.


Lionel Chevrier: I am afraid I cannot add anything to what I have already stated to the hon. member for Burnaby-Coquitlam, which in essence is this. In order to set up a board of review all the departments of government have to be consulted, and the matter must be discussed equally with the crown corporations and the various boards and agencies of the government. I am afraid that is going to take some time.


Horace Andrew (Bud) Olson: May I ask a supplementary question. Some action has been taken by this government in connection with cases raised on the floor of the House of Commons. Will the minister tell us that this is the proper procedure to be followed until such a board is set up, that is if the board is not going to be set up for some time?


Lionel Chevrier: I believe I indicated on a former occasion that if the hon. member did have a case, if he would be good enough to discuss it with me I would be glad to get the information for him. There are a number of such cases that are now under discussion, for some of which I have obtained information but for others, not yet. If my hon. friend has one or more cases I will be glad to take them into consideration if he will send me a note about them, or if he prefers to discuss them with me personally.
Inquiries of the Ministry (Translation):



WORLD FAIR


[Stage Direction]
On the orders of the day:
Louis-Joseph Pigeon: Mr. Speaker, I should like to put a question to the Minister of Public Works who is responsible for the world fair. Could the minister inform the house whether it is correct, as reported in the press, that Mr. Paul Bienvenu, president of the corporation, and Mr. Harry Price, of Toronto, member of that company, have resigned.


Hon. J. P. Deschatelets (Minister of Public Works):: I have not been officially informed that Mr. Price has submitted his resignation. I read in the papers that Mr. Paul Bienvenu had resigned. I must point out to my hon. friend, however, that Mr. Bienvenu himself has denied that press report.
(Text):



PUBLIC WORKS


[Stage Direction]
On the orders of the day:
Jean-Paul Deschatelets: Mr. Speaker, I should like to answer the question asked by the hon. member for Queens-Lunenburg a few days ago concerning dredging at Bridgewater. The requirement for dredging at Bridgewater was not submitted to the department in sufficient time for inclusion in the 1963-64 estimates; consequently no financial provision was made. The work would involve a major expenditure and no partial measure would be of any value.
The situation is that while some of the larger vessels may not be able to use this harbour, normal traffic is not hampered. The department will make provision in the 1964-65 estimates for increasing the size of the turning area to accommodate larger vessels now wanting to make use of this harbour. If the dredging were to be undertaken this year it could not be completed in time to benefit shipping this season.



ADMINISTRATION OF JUSTICE


[Stage Direction]
On the orders of the day:
Mr. Donald Maclnnis (Cape Breton South):: May I ask the Minister of Justice whether he or his parliamentary secretary made a request for a restricted list of law firms to handle departmental business?

Inquiries of the Ministry


Lionel Chevrier: I did notice that my hon. friend asked that question on the orders of the day on Friday, and I must tell him that as Minister of Justice, under the statute, it is my responsibility to appoint competent legal agents to handle civil and criminal cases on behalf of the federal government that are not handled directly by lawyers employed by the government. Since these people are agents of the Minister of Justice, their selection has always rested in his discretion and I have never seen this principle challenged. The paramount rule in the department is that they be competent.



POST OFFICE DEPARTMENT


[Stage Direction]
On the orders of the day:
Mr. O. W. Weichel (Waierloo North):: should like to direct a question to the Postmaster General. A few moments ago he announced the groups of postal workers who would receive increases in salaries. He did not mention the rural route couriers, and while I understand they are not civil servants within the group mentioned, would he advise whether further consideration has been given to salary increases for these couriers?


Azellus Denis: I believe that the regulations are fairly clear so far as rural mail delivery is concerned. These contracts are given after tenders have been called, and the length of the contract is four years. The rural carrier can request an increase after two years, and if it is appropriate we will give it to him.



INQUIRY AS TO MAIL SERVICE TO BRITISH GUIANA

[Stage Direction]
On the orders of the day:
Thomas Clement (Tommy) Douglas: Mr. Speaker, I wish to direct a question to the Postmaster General. In view of the fact that some Canadian citizens have had mail which they sent to British Guiana returned, marked "Service suspended", has the postal service from Canada to British Guiana been suspended and, if so, why?


Azellus Denis: Mr. Speaker, I read something in a newspaper report to the effect that the service has been restored, and that is all I can say so far as this matter is concerned.


Thomas Clement (Tommy) Douglas: As a supplementary question, will the minister make some inquiries and ascertain whether postal service to British Guiana has been suspended and, if so, why?


Azellus Denis: I will inquire with great pleasure, Mr. Speaker.



ROYAL CANADIAN NAVY


[Stage Direction]
On the orders of the day:
Mr. David Orlikow (Winnipeg North):: Mr. Speaker, I would like to direct a question to the Minister of National Defence. Almost two weeks ago he said, in reply to a question I asked him, that in a few days he expected to be able to make a statement on the Petersen case, the man dismissed from the navy whose father in law was a communist. Is that statement ready and, if not, when can we expect to get it?


Paul Theodore Hellyer: I hope it will be ready soon, Mr. Speaker.
(Translation):



PENITENTIARIES


[Stage Direction]
On the orders of the day:
Mr. Leo Cadieux (Terrebonne):: Mr. Speaker, may I ask the Minister of Justice if the site of the new penitentiary to which frequent reference has been made in this house has been selected and, if so, if it is located in the constituency of Terrebonne?


Lionel Chevrier: Mr. Speaker, I wish to inform the hon. member that a piece of land belonging to the Department of National Defence and located at St. Anne des Plaines has been declared surplus by the crown assets disposal corporation and transferred to the office of the commissioner of penitentiaries of the Department of Justice. That property is fifteen miles away from the St. Vincent de Paul institution and considered to be an excellent site on which to build a maximum security institution in the province of Quebec.
(Text):



CANADIAN NATIONAL RAILWAYS


[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Pori Arthur):: Mr. Speaker, I would like to ask the Minister of Transport whether he can confirm that the Canadian National Railways have decided to postpone implementation of run-throughs in western Canada?


George James McIlraith: Yes, Mr. Speaker. The announcement was made late on Friday afternoon.



FINANCE


Walter Lockhart Gordon: the second reading of Bill No. C-86, for approving certain expenditures authorized for the public service, and the application of certain amounts in the accounts, for the financial year ended the 31st March, 1963.
Mr. E. J. Benson (Parliamentary Secretary
to Minister of Finance): Mr. Speaker, the purpose of this bill is to close the accounts for the fiscal year ended March 31, 1963. This action is necessary in order that the audit of the accounts may be completed and reported upon by the Auditor General. His report will then, of course, be submitted to the public accounts committee where witnesses may be called and hon. members of the committee may fully examine the accounts, along with the report thereon submitted by the Auditor General. The Auditor General will, in his report, comment upon any actions which he may believe open to question.
Bill C-86 will be the final appropriation act for the fiscal year 1962-63. Parliament was dissolved on February 6, 1963, without having completed its consideration of the estimates and without having made adequate provision for the expenditures for the complete year 1962-63.
I will not comment upon the fact that vast sums of money were spent during the 1962-63 fiscal year without departmental estimates having been approved by this house. I believe that this matter was amply debated both in the house during the last parliament and during the ensuing election campaign.
I respectfully suggest to hon. members that this bill be dealt with as expeditiously as possible in order that the Auditor General may complete his job for last year and that we may get on with this year's business, to assure that a similar situation does not occur in the current fiscal year.
The situation experienced in February, 1963 was to all intents and purposes an exact parallel to the situation following from the dissolution of parliament in February, 1958. With minor exceptions the procedure which this government intends to follow in cleaning up the outstanding business of 1962-63 will parallel the course of action pursued by the former government in August and September, 1958, in cleaning up the outstanding business of 1957-58. It should be noted, too, that a major portion of the action currently being proposed is not open to question on this occasion, as it might have been in 1958 and prior years, inasmuch as an amendment to
15, 1963
Approval of Expenditures, 1962-63 the Financial Administration Act, passed by parliament late in 1958, requires that amounts appropriated by way of special governor general's warrants while parliament is not in session must be submitted for consideration by parliament during the ensuing session.
As in 1958, the government has provided a report on supply for the fiscal year ended March 31, 1963, in which is set forth in great detail the total estimates and supply picture for 1962-63. On Friday last, on behalf of the Minister of Finance, I tabled this report on supply which set forth for each vote the total of all of the estimates, both tabled and not tabled, which were approved by the government in respect of 1962-63. There was also a comparable presentation of the amounts of supply already granted or to be granted in respect of the past fiscal year, including the amounts authorized by appropriation acts, the amounts authorized in pursuance of governor general's warrants, and the amounts for which authority is being requested in this bill. In this latter category there are 36 items which are considered to be proper charges to the 1962-63 budgetary accounts. None of these items, when authorized by this bill, will provide for further cash outlays chargeable to the old year accounts.
The summary on page 3 of the report discloses that the total amount of all items to be voted-that is government expenditures other than those which are payable under continuing statutory authority-amounted to $4,293,642,685. All but $328 million of that total amount was included in estimates tabled during the last session of parliament. There is here a difference between the 1958 and 1963 experiences. The final supplementaries for 1957-58 were tabled before parliament dissolved on February 1, 1958, whereas the final supplementaries for 1962-63 were not tabled prior to dissolution on February 6, 1963.
The summary discloses further that parliament passed five appropriation acts in 1962, thereby appropriating $3,390.7 million, leaving $902.8 million of the estimates unauthorized at the point of dissolution. Subsequently the Governor General, under the emergency authority contained in section 28 of the Financial Administration Act, caused special warrants to be issued authorizing further expenditures of $641.3 million.
Here is the second point of difference between the practice followed in 1958 and that of 1963. Five years ago the government proposed, and the Governor General approved, a single warrant to provide for expenditures during the last two months of 1957-58. This year a two phased exercise, resulting in the issue of warrants on February 8 and March 4, allowed for a more careful review of actual cash requirements, and it is hoped that the final

Approval of Expenditures, 1962-63 audit for 1962-63 will indicate a more careful use of special warrant authority in 1963 than was the case five years ago.
The final entry on the summary relates to the proposal that parliament now authorize the charging to the budgetary accounts of 1962-63 of certain expenditures deemed to be appropriate subjects for such treatment. This treatment, in most cases, accords with that afforded in 1958. In other cases items are suggested for inclusion in order to overcome obvious inconsistencies in the 1958 exercise; and finally, some items are proposed on their individual merits. A basic rule in the choice of the 36 items for which parliamentary authority is now requested was that the relevant cash outlays had already been made and that no new cash outlays, chargeable to the 1962-63 accounts, will result from their being authorized during this session. I will be pleased to answer questions on these items during the committee stage of this bill.
Finally, Mr. Speaker, the summary indicates that some $49.7 millon of the total estimates to be voted was not ultimately required. Most of this amount represents those portions of appropriations which would lapse in the normal course of events. A footnote to the summary provides a balancing entry for those who may be interested in reconciling last year's records respecting appropriation acts with the figures shown in this report.
I would now refer the house to page 4 and onward of the report. Here we find, for each vote in each department, both the total estimates amount and the comparable supply amount. The supply amount is also broken down into its important components, namely the portion provided by parliament during 1962, the portion made available by special governor general's warrants, and the amount which parliament will now be asked to authorize.
Returning now to the bill which is before the house, this bill proposes approval of the expenditures authorized by the aforementioned governor general's warrants and the 36 special items which have not yet been authorized but which are considered to be proper charges to the budgetary accounts of the fiscal year 1962-63. Because no final supply bill for 1962-63 has yet been passed, this bill has been prepared in a form which will serve as a final 1962-63 supply bill in Canadian financial records. Finally, as the passage of this measure will not in any way restrict the authority of the public accounts committee to pursue its normal activities in respect of the public accounts for 1962-63, I urge that it be given favourable consideration by this house.
Before resuming my seat, Mr. Speaker, it has occurred to me that I should forestall
any arguments which may be made that expenditures for the fiscal year 1962-63 have in any way been increased beyond what is normal and proper. Hon. members will note that on page 71 of the report on accounts the total amount of the 36 items for which authority is sought is shown as $211,856,066. Considering this amount, if one then looks at pages 67 to 70 of the report they will see items amounting to $37,545,558 which do not affect the budgetary deficit. This reduces the amount which is being added, which would affect the deficit to $174,310,508. Of this there are items which are identical or directly similar to items included in 1958-that is, items which were put into the final supply bill in 1958 by the former government-in the amount of $73,529,057. This includes items such as the agricultural commodities stabilization account loss of $71,856,049, and so on, totalling $73,529,057. This reduces the amount which could be considered as affecting the budgetary deficit to $100,781,451. From this there should be deducted two items which were covered by governor general's warrants in 1958 and which are now being included as a final supply item in 1963. These are first of all the Canadian National Railways deficit, which is $48,919,500, and the final payment with respect to the Colombo plan in the amount of $3,458,333. Thus if we deduct this amount of $52,377,833 we get down to an amount of $48,403,618 as affecting the budgetary deficit due to this bill and to the actions of the government.
From this there is a certain group of other items which I believe are quite proper charges and which I would deduct at this point. First of all there is the T.C.A. deficit, which is included in this supply bill, of $3,540,700, which occurred in the calendar year 1962 and is thus, I believe, a proper charge to the 1962-63 fiscal year. There are also several items to effect write-offs which were recognized as valid prior to March 31, 1963. These include the write-off of the N.R.U. reactor of $25,239,005, the write-off of loans to Northern Canada Power Commission, which was doing some work at Inuvik in the Northwest Territories, for which the government had agreed to reimburse it. This amounts to $7,004,000. Then there is the write-off of land in the canal navigation system at Cornwall, Ontario, which was recommended in two succeeding years by the Auditor General, amounting to $1,710,600; and the write-off of loans to the New Westminster harbour commission of $284,700, making in total a further reduction of $37,779,005.
This gets the amount that would affect the deficit and is debatable down to $10,624,613, and this is made up of the following items.


Payments in connection with the winter works program of 1962-63, the final cost being $5 million, and payments to various funds to which there was a contribution by the government to bring these funds up to the agreed amount, as follows: the national gallery fund, the national centennial fund, the national library purchase account, the national capital fund and the railway crossing grading account. These amount to $1,043,291. Then there is the payment with regard to the south Saskatchewan dam, affecting 1962-63, of $240,259. There are certain reimbursements to Central Mortgage and Housing Corporation which the government agreed to make with respect to the past fiscal year. The amount in respect of research and community planning of C.M.H.C. was $754,794; reimbursement of C.M.H.C. for losses in federal-provincial housing projects in the past fiscal year amounted to $1,204,949; reimbursement of C.M.H.C. for forgiveness of municipal loans under section 36G of the National Housing Act for 1962-63 amounted to $1,873,630. Finally the figure in regard to dredging Montreal harbour, which work was completed in the fiscal year 1962-63, amounted to $507,700. This gives a total of $10,624,613.
I think all hon. members will agree that these are proper charges to the accounts for the fiscal year 1962-63, and I would therefore urge all hon. members to assist in allowing
the passage of this bill in order to clean up last year's accounts.


Hon. George C. Nowlan (Digby-Annapolis-Kings):: Mr. Speaker, I think first I should congratulate the parliamentary secretary to the Minister of Finance on the way he is piloting this bill through the house. It is always a pleasure to see young members coming along and those who are not always in the front row given responsibilities in piloting bills through certain stages. I want to congratulate the parliamentary secretary in this regard.
Having said that, I was reminded in listening to him of something Shakespeare once wrote; "Methinks the lady doth protest too much". If the bill is as simple as he says it is and as clearcut as all that with no ulterior motive whatsoever, then I do not know why he spent ten minutes of his time in dealing with anticipated criticism which might be made in committee. I will not say he had a guilty conscience, sir, but there might have been an uneasy feeling in his mind when he began to deal with the figures which are presently before us.
There is, of course, nothing one can do about these figures at the moment because we have no way in which we can balance
28902-5-140
15, 1963
Approval of Expenditures, 1962-63 them against definitive amounts. One has to accept, and one does accept, of course, the statement of the parliamentary secretary in respect to the way in which these moneys have been advanced and expended. I quite agree with him that there were no additional items here which could go into the cash balance of the public account other than those loans and advances to which he referred which are below the line. But there are quite a few figures, Mr. Speaker, included in those to which he referred which do affect the increased deficit or the budgetary deficit of the country.
If I were a suspicious person, which of course I am not; and if I were a partisan, which of course I am not, I might feel that possibly the parliamentary secretary found some way of adding figures to these expenditures so as to show how much bigger the deficit under the preceding government, the government of my right hon. friend the Leader of the Opposition (Mr. Diefenbaker), was compared with that of the present government. I am sure that when these figures were brought down the thought was that it would be very helpful if it could be shown that the deficit incurred by the preceding government was substantially greater than the deficit which would be incurred by this government under the budget brought down by the Minister of Finance (Mr. Gordon) on June 13.
Now, of course, as things have turned out the government know that is entirely hopeless, and what they are hoping to do is to have the deficit of the present government under the Minister of Finance, if possible, not too much greater than the deficit incurred by the preceding government. The situations have been reversed. But I think that even with these additions, which perhaps can be questioned and to which I will make some brief reference in passing in committee, the purpose has failed. It would be indulging in the rankest of prophecy to say that the deficit next year might be much more substantial than the deficit this year if we completely accept without question all the figures contained in the white paper and the figures contained in this report on supply. We do not accept them per se, Mr. Speaker. We do not think some of them should be properly charged to the preceding government at all. However, I will have something to say about them in a moment-and one does not have to apologize for this-and in committee we may question certain items which are before us.
One reason you have no starting point and no way in which to balance them is that in the estimates we have before us, in the first

Approval of Expenditures, 1962-63 column of the total estimates in the report, you will find the words "excluding statutory items". Mr. Speaker, I am not quarrelling with those words entered there. They were entered there, as the parliamentary secretary said, in the report which my predecessor the former minister of finance brought down in 1958. But when you bring those words in, what is meant by statutory items? Where is the starting point? For instance, everyone knows that the salary, shall we say, of Mr. Speaker is fixed by statute. We know what the salary is; it is easy to determine. But when you come to another statutory item, such as the amounts paid to the provinces, then how do you determine those amounts without going into all the details with officials? Because the amount paid to each province varies from year to year, depending on the shift in population of the province concerned. How do you determine another statutory item such as the amount paid by way of family allowances? That amount varies too with the population. How do you determine, as another example, the amounts paid to the universities? That is a statutory amount, and it too depends upon the population of each province.
So there is no way whatsoever of determining these amounts by taking these figures per se, analysing them, and coming to any final result in so far as they affect the total over-all deficit. All we have here is the amount of our appropriation acts passed by the preceding parliament and the amount covered by governor general's warrants, and we are asked today to pass 36 items amounting in all to $211 million. We are also asked to approve the fact that the preceding government spent this money before March 31 or, if they did not spend it, that they were responsible for its expenditure.
Mr. Speaker, one could spend days and days and days analysing these figures. The minister could have his officials in front of him and one could go through one department after another, and in the end you would reach a result depending on your own wishes and on the imagination you were using in analysing the figures. So we of the opposition do not propose to spend very much time this afternoon in dealing with the bill on second reading. Some of the items to which the parliamentary secretary referred should undoubtedly be charged to the expenditures of last year. The C.N.R. deficit-although on this I will have some comment to make when we reach committee stage-and the T.C.A. deficit are both matters properly chargeable to the former government under the fiscal year ending March 31.
But there are others. I question entirely the figure relating to the N.R.U. reactor. The re-

actor has not been thrown down the drain. It is still working and still doing the same work today as it did a year ago. There is no reason in the world why that reactor should be charged up to our expenditure for last year except for the fact that the government wants to increase the deficit by some $20 million plus. With regard to the Cornwall canal, the parliamentary secretary said this had been recommended by some committee some years ago. Is that any reason why it should be charged up to the former government at this particular time? Mr. Speaker, you know very well why it is being charged up. As I say, one could go on and on with various items, and I do not propose to do so. But I think, or I hope, we will spend a brief time, subject to other hon. members in the committee, dealing with some of the items, and then we will let the matter pass.
I should like to point out in passing, Mr. Speaker, that if you accept the deficit as now proposed by the parliamentary secretary of $709 million-we do not, of course, but for the sake of argument if we accept it-we find it is $82 million less than the actual deficit in the preceding year. So that even accepting the figure of $709 million the deficit is $82 million less than it was the previous year. One would have liked to see it even less. We can argue that it should be less, but even accepting the figure as it is one can say that the government of which I had the pleasure and honour of being a member did keep its promise and worked, although perhaps very slowly, toward a balanced budget.
When you think, Mr. Speaker, of some of the expenditures made by the former government as compared with the previous one, the actual increase in expenditures on the figures before us today is $64 million over the preceding year 1962. One could analyse these figures and see how they were arrived at. I can point out right away, though, that during the past year the government of which I was a member paid out for technical training and vocational schools $171 million more than was paid out in the preceding year. I have forgotten the exact figure, but there were millions and millions of dollars more paid out in health and welfare fields than were disbursed in the preceding year. We could argue about the deficit, that we should not have increased the deficit and so on. The fact remains that last year the interest and carrying charges on our debt was $79 million more than in the preceding year. When one realizes that our total increase in expenditure was only $62 million and that those two items to which I have referred amounted in themselves to $240 million, we can certainly suggest without boasting that there was very good administration shown in carrying on

the services which we did carry on while incurring such a relatively small increase.
I hope the parliamentary secretary can tell us, when we get into committee, what was the increase in the statutory payments during the past year as compared with the year before. I think hon. members will find that it was fairly substantial. We know from our records that people are living longer, that more and more money is being paid out to those in receipt of old age pensions, fortunately for those of us who are getting older. I suspect that the statutory payments made last year were a good many millions of dollars more than were paid out the year before. I am suggesting, without taking the time of the house by going into the figures in great detail, that even having regard to the amounts which are now before us, we are relatively happy with the record so established. It is certainly not one which suggests poor administration or anything of that kind as far as the government of which I was a member is concerned.


Horace Andrew (Bud) Olson: One feels a certain amount of futility in dealing with appropriations of money which has already been spent and in respect of which no useful action can be taken at this time to indicate to the government whether it is being spent properly or in line with the wishes of members of parliament.
I am always amused by the Leader of the Opposition and by other members of the Conservative party when they try to make so much of their respect for the rights of parliament. During the last few years I do not think any party has run roughshod over the rights of parliament to the extent they have. I say this because I believe the examination of the estimates is one of the most important functions of hon. members. If the right of hon. members to peruse or examine expenditure, or proposed expenditure, were taken away, in other words if the right to control the purse strings were taken away from members of this house, we would have reached a stage where a most important part of the rights of those elected to parliament would have been removed.
Let us look back at last year. I apologize if I am wrong, but for the most part the money which is being voted in this appropriation bill is money which was spent by the previous government. I think if we look back over the past year we will find that the business of the house was organized in such a way that priority was certainly not given to the examination of the government's estimated expenditure by members of the house. There appeared to be considerations in the mind of the government of that day 28902-5-140J
15, 1963
Approval of Expenditures, 1962-63 which were above and beyond the importance of the rights and privileges of members of parliament to discharge this important function.


An hon. Member:: Who stopped them coming in?


Horace Andrew (Bud) Olson: Someone asks "Who stopped them coming in". Well, if my memory serves me correctly the government of that day had the responsibility for organizing the business of the house, and if they chose not to bring forward the estimates that omission must remain the full responsibility of the administration of that time. I would also point out that as far as this group are concerned we leaned over backward to give the government more time to bring in its measures dealing with the business of the country. But there is a limit to anyone's patience.


An hon. Member:: You can say that again.


Horace Andrew (Bud) Olson: I should like to give the house an example of the former government's indifference to the rights of parliament. On page 61 of the report on supply we find an item of $16 million in respect of which authority is now being sought. The item concerns payments under the Freight Rates Reduction Act. Not one cent of that sum was appropriated by way of interim supply or authorized by an appropriation act. I know there were a number of members who were anxious to discuss this question whenever it might have arisen, either during the discussion on interim supply or on some other occasion. The opinion is definitely prevalent in this country that this direct grant discriminates against forms of transport other than the railways. We in this group particularly wanted the opportunity to discuss this matter and the effects of such an appropriation, before the money was spent. Now it is spent.
As I say, I do not wish to take up much of the time of the house at this point, but I believe we must take a long, hard look at what is happening to these important rights and privileges of hon. members in all parts of the house. In my humble opinion we should have the right to control the purse strings and governments must not put other considerations, whatever they may be, above this important duty which falls on hon. members.
There is another matter to which I should like to direct the attention of the parliamentary secretary to the Minister of Finance. I wish to raise it again when we get into committee. On page 8 we see an amount of $71,856,049 for which there does not appear to be any authorization by interim supply or by special warrant of the Governor General. This amount is all being asked for under the bill before us now, and we should like to

Approval of Expenditures, 1962-63 have a detailed explanation as to the purpose for which this $71 million is required.
As I have said, when one looks at these expenditures one feels a certain amount of futility. The money has already been spent. It is gone. What is the use, therefore, of raising any objections now? This is the situation we face. I know that the trucking industry, for example, had a lot of representations to make to the government respecting the $16 million that was paid to the railways. They seem to think they can prove that this money and other money that the government grants to the railways is used to lower freight rates in certain areas so as to squeeze out the trucking industry.
I am certain that the government and members of parliament generally do not wish to appropriate public funds for the purpose of squeezing certain segments of industry out of business, in this instance by giving the railways subsidies which enable them to lower their rates below what is reasonably competitive.
With these few remarks, Mr. Speaker, I wish to draw to your attention again that the responsibility of government includes the responsibility to organize the business of the house so that the rights and privileges of members respecting the spending of money will not be taken away.


Stanley Howard Knowles: Mr. Speaker, this is a bill to validate expenditures that were made in the fiscal year 1962-63. It is fairly evident that the house has no option but to pass the bill, but I suggest that while we are doing so the flag ought to be put at half mast. We are in effect drawing attention to the fact, and it is a fact that the bill does not set aside, that the 1962-63 fiscal year was one in which all the taxpayers' money that was spent was spent without consideration of the items in the estimates.
A very large portion of the money got voted through the medium of interim supply bills. Every time an interim supply bill was presented to the house we were assured that no one of these bills was appropriating all of any estimate for the year, and that there would be an opportunity to members before the entire amount was voted to discuss the individual items. Hon. members who were here will recall that in December of last year I pointed out that the undertaking given at that time by the then minister of finance was in my view an undertaking that was given in good faith but one that would not be kept. And it was not.
The other way in which money was authorized for expenditure was by the issue of governor general's warrants. Yet even


though it can be said that the money spent under the interim supply bills and by governor general's warrants was spent legally, it is still true that in that year, 1962-63, the House of Commons of Canada, the peoples' representatives, the members who are supposed to have control of the purse strings, had no opportunity to vote for any one of the individual items of the estimates. I suggest, Mr. Speaker, that my proposal that the flag be put at half mast is a very mild one. This is something that is not good in the history of Canadian parliamentary democracy. To have this kind of experience is sad.
The bill before us will do three things at least, though it might do more as well. It does a certain amount of bookkeeping and this leads, of course, to argument between the present government and the former minister of finance as to which column figures are being put in. It does not make much difference to the taxpayer in the end. As I say, the bill does some bookkeeping. The second thing it does is to give formal or parliamentary approval to the money that was spent under the terms of governor general's warrants. The third thing it does is to authorize the expenditure of the 36 items referred to by the parliamentary secretary to the Minister of Finance. But in any case, Mr. Speaker, no matter under what heading you subsume the various items, in all cases we are talking about money that is already spent, and there is nothing we can do about it but note the fact that the year 1962-63 was a sorry one for the parliament of Canada in terms of the responsibility that is supposed to devolve upon the people's representatives.
I know that when this question comes up arguments arise as to whose responsibility it was, whose fault it was. There is no point now in going over all that, except to say that parliament could have been called earlier in 1962. We could have got at the estimates if there had been recognition at that time of their importance, the importance of the principle that parliament controls the purse strings. But I think what the parliamentary secretary to the Minister of Finance said at one point is perhaps something that we should note. He said "Let us not spend too much time quarrelling about the past; let us make sure that it does not happen in this session of parliament". I suggest that is an admonition that is well put. Let it not happen in this session of parliament. It ought not ever to happen again.
I have done a lot of thinking about this problem, Mr. Speaker, and I confess I do not see how we can prevent it from happening by changing the rules or changing the statutes. I think the only way this sort of

thing can be prevented is by increasing in the minds of all members of parliament, and particularly on the part of those who are on the government side of the house at any given time, respect for the rights and traditions of parliament. There is need for more respect for the importance of the control of the purse strings. If a government had that respect I suggest it would find a way to organize the business of the house in such a manner that the estimates would be dealt with.
There is a tendency in this House of Commons to feel that the estimates are something that can be dealt with when everything else is done; that they can be put off until Friday; that we can hold Saturday sittings and deal with estimates, or that they can be left until the fall or some later time in the session. The feeling is that we have to get along with legislation because legislation is important. I am right there with everyone else asking the government to proceed with particular pieces of legislation in which I am interested, but estimates also constitute legislation. They constitute one of the most important pieces of legislation that we deal with, and I hope that the experience we are going through today, realizing that we are put on the spot in that we have to pass a bill about which we can do nothing, will cause us to think a bit about the importance of the role of dealing with the expenditure of money.
As I say, it is a highly perfunctory performance we are going through this afternoon. Members on the government side are now on the treasury benches and they are faced with the constitutional and legal necessity of getting this legislation through. It relates to money they did not spend but because they have to get it through they are prepared, of course, to support the bill. Members of the official opposition are faced with a bill that validates spending done by them last year, so they have got to support it. The other two parties in this corner of the house were witnesses to the whole business. Most of us were here last year and we tried to get the estimates brought on. We wanted a chance to discuss them. We have no option but to support the bill as well, but I emphasize the perfunctory nature of the whole thing not just to throw stones in the direction of those I think were responsible but to urge the necessity of greater respect for the estimates of parliament, greater respect for the principle that parliament does control the purse strings.
In this connection I hope that when the day comes that we get the special committee on procedure established, that committee
Approval of Expenditures, 1962-63 will give some thought to this problem. I hope that thought will be given to it in some other quarters. I have been interested in browsing through the records of some of the early years of the House of Commons of Canada, and I have discovered that in the first session of the first parliament, which began after the 1st of July, 1867, the members of that day had a supply bill.
They thought it was a huge sum of money. It was $5 million. Mind you, this amount was not for a full 12 months; it was for nine months from July 1, 1867 to March 31, 1868. This would work out to something in the order of about $6.5 million for a full year.
Perhaps 1867 is not a good year to take as a basis for comparison. Let us move on two or three years to about 1870 or 1871. If you look at the records for those years, you will find that the total expenditures of the Dominion of Canada were running around the order of $13 million or $14 million a year. I am sure our forebears who sat in the House of Commons of that day, the building that was previously here, were impressed by this staggering figure of $13 million per year. This year, Mr. Speaker, our budget is something over $6 billion. We have multiplied our expenditures from 1870 to the present time by 480 times. We have increased our expenditures, in other words, by 48,000 per cent.
However, Mr. Speaker, we are still handling these much larger sums of money in almost the same way as those sums of money were handled in 1867 and 1870. It is still done by the individual items having to be processed through the committee of supply. They managed to do this in eight or ten days back in those days, because the amounts were much smaller. The basic way in which the matter is handled, however, has not changed in all these years.
Now, I have already said something about the importance of parliamentary control of the purse strings, and I think this must not be overlooked in any way, shape or form. I do believe, however, that we have to find some way to cope with the greatly increased amount of money we have to vote, to cope with the greater complexity of government business. One proposal that was suggested a few years ago was that of setting up a standing committee on estimates. It does not seem to me that this method has been used as much as it might have been. I should like to urge that our special committee on procedure, or other bodies that are interested, take another look at that process to see if we cannot make more use of the committee on estimates. This committee was set up on the basis of having the estimates referred to it, with the idea that those estimates would

Approval of Expenditures, 1962-63 be returned to the committee of supply, and with the further idea that, having been examined thoroughly in the standing committee, time might be saved in the house.
The idea is not just to save time so that we can go off on a holiday. The fact is that there are only 365 days a year and if we were to sit every day in the year we would not be able to do all the business that comes before us in the same way as it was done by our forebears, even although they had to deal with only 1/480th of the amount of money with which we have to deal.
Perhaps we will have to come to some understanding on a basis whereby we thoroughly examine some departments one year and leave the remainder of the departments to be examined thoroughly the next year. I throw this out as a suggestion. I do not believe we should go on year after year, decade after decade, without finding any new ways of dealing with the problem. The experience through which we are now going should bring us face to face with the fact that this is a very real problem. I know that we have this particular problem because the dissolution that took place and the fact that elections came along pretty thick and fast. However, even when we have a parliament that lasts three, four or five years, this same problem remains, of how to get a proper treatment of the estimates. All that the present experience does is to highlight the problem for us.
I urge that, based on our having to vote today a whole year's estimates without having considered them at all, the time has come when we ought to be trying to find some way to improve our handling of these estimates. I emphasize again that even more important than any changes in the way we handle them, even more important than any rules or committees or what have you, is the need for all of us in this place, having the highest respect for the importance of our job as members of parliament, to see to it that we control the purse strings, that it is not left to the executive to spend money and come along afterwards to get approval. This basic tenet of parliamentary practice should be followed.


Mr. G. H. Aiken (Parry Sound-Muskoka):: Mr. Speaker, I do not intend to hold up the passage of this bill unduly, but in view of the snipings in which various hon. members have indulged, and which have been directed at the former government because of alleged delay in the passage of legislation and estimates during the 25th parliament, I have a few words to say in reply. I should like, therefore, to take a few moments to go through what I believe are some of the most important


facts arising out of that parliament as they refer to the present situation.
It is very disturbing, for a member who sat through the 25th parliament as a member of the government party, to hear these people who filibustered, delayed and wrangled over the business of the house last year, preventing the passage of a great deal of legislation, saying now that the former government failed to conduct the business of the house in a proper manner. I think that in saying this they are, to say the least, being unfair; and to say the worst, they are wrong. I should like to make some comparisons because I think comparisons are what we must make at this point.
The hon. member for Winnipeg North Centre (Mr. Knowles) said we must examine the procedures of the house in handling some of these matters. It was stated also that we ought not to allow this situation to happen again, as it did in the 25th parliament-that is the passage of estimates by governor general's warrants without complete investigation by the house. I cannot help agreeing with the hon. member entirely on that point. What is required in order to conduct such a full, fair investigation is a responsible opposition. I am going to suggest, Mr. Speaker, that in this 26th parliament we have a responsible opposition, and I refer particularly of course to the official opposition. I want to say that this opposition has acted in the best interest of the country and has proven to be a responsible opposition, trying to do its job for the sake of the country, and actually conducting the business of the house without all the delaying tactics that were used in the last parliament.
Now, in spite of the remarkable number of mistakes the government has made during this session, the progress on essential and non-controversial measures brought before this parliament has been good. This is the 42nd day of this session and we have completed the speech from the throne, and the budget debate, we have passed the exports insurance bill, the bill to establish the Atlantic development board and the department of industry. In so far as estimates are concerned, we have completed the estimates of the Department of Trade and Commerce and we have made a good start on the estimates of the Department of Transport.
I should like to refer for a moment to private bills because, here again, I believe this parliament has made good progress. Most of us remember that in the last parliament private bills were delayed, and on many occasions for political reasons. In so far as standing committees are concerned, I would refer particularly to banking and commerce and

miscellaneous private bills, in which many of the private bills were opposed merely for the purpose of delay. A good many of these committees were used for the sole purpose of trying to bring some other issues before them, and of trying to delay the passage of government business. Already this session the committee on banking and commerce and the committee on miscelleneous private bills have passed a good many of the private bills left over from the last parliament.
The hon. member for Medicine Hat (Mr. Olson) mentioned that the former government did not succeed in passing the estimates, and he laid some blame on that government. In reply I would say that if his party had not divided when the crucial vote came, we might have been able to finish the business of the house.


Horace Andrew (Bud) Olson: You needed new estimates by that time.


Gordon Harvey Aiken: Mr. Speaker, everyone knows that the temper of the 25th parliament was not one in which any work could be properly done.


Horace Andrew (Bud) Olson: Because of lack of leadership.


Gordon Harvey Aiken: The hon. member was not here from 1958 to 1962 when some of the best legislation ever brought forward in Canada was presented and passed. I do not want to go into it all, but he knows very well the legislation to which I refer-the vocational schools program, the sewage and waterworks program and so forth.
A minority government requires the support of every hon. member in the house, and it must be remembered that the former government had only 116 members out of a total of 265. Now hon. members who sat in opposition at that time come along and say, "Oh, you did not do anything."


Horace Andrew (Bud) Olson: Would the hon. member permit a question?


Gordon Harvey Aiken: Yes, I will, when I finish my sentence. The reason business could not be advanced was because there was nothing except filibuster, wrangling and delay-


Mr. Robichaud:: Filibuster by yourselves.


Gordon Harvey Aiken: -with the result that the business of the government was held up. I will accept the question now.


Horace Andrew (Bud) Olson: I would like to ask the hon. member, could he tell us why, in the last session of the 24th parliament, which actually should have passed these estimates, the government was unable to do so at that time, when it had such an overwhelming number of members on its side of the house?
Approval of Expenditures, 1962-63


Gordon Harvey Aiken: The hon. member is asking about the 24th parliament. My reply is that the business of 24th parliament was well conducted.


Horace Andrew (Bud) Olson: The last session?


Gordon Harvey Aiken: Yes, in the last session.


Horace Andrew (Bud) Olson: That is when these estimates should have been passed.


Gordon Harvey Aiken: The government satisfactorily conducted the business that was before the house.


Hédard-J. Robichaud: You are easily satisfied.


Gordon Harvey Aiken: It is very easy for the hon. gentleman to say we did not do this, but there is a very well-known saying in this house, and it is a true one, that the government proposes and the opposition disposes. Those measures which the present government has proposed and which are worthy of approval have been passed by us to date, and I think that is a case of responsible disposal.
I am sure the Secretary of State would like to use part of what I have said by way of proving that he has done a good job in conducting the business of the house. He shakes his head, so perhaps he would not; but I am sure someone else in his party will. I merely say that the conduct of the business of this parliament depends on the co-operation of everyone in the house, and I can speak for my party in saying that those measures which are good for the country will be dealt with expeditiously, and have already been dealt with in that manner.
I do not want to rehash old scores of the last parliament, but it was mentioned that these estimates could have been brought forward last year. I would point out that in 1962, which includes the period referred to by the hon. member for Medicine Hat, all parties then in opposition spent 27 days on supplementary estimates which should have been passed in much shorter time than that. In the fall session of 1962 the opposition spent eight days on interim supply-


John Whitney Pickersgill: May I ask the hon. gentleman a question?


Gordon Harvey Aiken: When I finish my sentence.


John Whitney Pickersgill: I would like to ask a question about that point.


Gordon Harvey Aiken: All right. The opposition spent eight days on interim supply, on an item that should have gone through in half an hour.


John Whitney Pickersgill: Will the hon. gentleman not admit that on two occasions the government was given interim supply within a few hours, and in one case within a few minutes,
2194	HOUSE OF
Approval of Expenditures, 1962-63 and it was only when it became evident, as the hon. member for Winnipeg North Centre (Mr. Knowles) pointed out, we were never going to be allowed to discuss the main estimates, that we took that time on interim supply?


Gordon Harvey Aiken: I do not agree with that at all.


John Whitney Pickersgill: The record is there to show it.


Gordon Harvey Aiken: That supplementary estimates were passed within a few hours?


John Whitney Pickersgill: I am talking about interim supply.


Gordon Harvey Aiken: I will add to what I said by saying it was a plain case of filibustering and delaying everything the government brought forward.


Mr. Byrne:: Nonsense.


Gordon Harvey Aiken: It is not nonsense. Everyone who sat in parliament at that time knows there was nothing but delay, filibuster and wrangling to try to make the government look ineffective, a government that was in a minority position and which could not do anything without the complete co-operation of all hon. members.


Horace Andrew (Bud) Olson: Tell us about the earlier parliament.


Gordon Harvey Aiken: I have just finished speaking about the earlier parliament and about what happened to supplementary estimates.


Stanley Howard Knowles: Would the hon. member permit a question?


Gordon Harvey Aiken: Yes.


Stanley Howard Knowles: I wonder if in his interesting speech the hon. member would tell us a little more about that earlier parliament, in the light of the fact that the estimates we are now being asked to approve are estimates that were presented to the 24th parliament? As he knows, one of the clauses in this bill asks us to provide that these estimates be taken as having been passed on April 1, 1962. Would it not have been possible in that parliament, the one before the last one, when the party with which he is associated had a huge majority, to stay a little longer and get those estimates through, if it had had respect for this principle?


Gordon Harvey Aiken: The hon. member knows very well that the estimates in 1962 were brought forward very shortly before the house dissolved for the election.


John Whitney Pickersgill: You did not have to dissolve it.


Horace Andrew (Bud) Olson: Why dissolve it then?


Gordon Harvey Aiken: The house dissolved in April for a June election, and how one could consider passing estimates in that time I do not know.


Horace Andrew (Bud) Olson: Nonsense.


George Clyde Nowlan: Are we in committee, or where are we?


Gordon Harvey Aiken: We had a full four years-


Horace Andrew (Bud) Olson: Would the hon. member permit a question?


Mr. Deputy Speaker:: Order. The hon. member for Parry Sound-Muskoka has the floor and he should be allowed to continue without interruption.


Gordon Harvey Aiken: Thank you, Mr. Speaker. The 24th parliament had a full period of four years, which is the usual, customary and accepted period of time for the life of a parliament. If that parliament had gone on for five years one could very well have said the government was unduly delaying its appeal to the country. There is no argument in saying that the government should have stayed on for another six months or a year; that has nothing to do with it. The government stayed on for a full four years, and I see no reason now for coming back and saying it should have gone on a little longer. I do not know what would have happened during the remainder of that time. In fact I have been trying not to rake up past history, but now we are going back over the history of two previous parliaments.
Mr. Speaker, I wish to wind up my remarks by saying that the official opposition at this time feels it is providing responsible opposition to the government with respect to the position in which this country and parliament finds itself, with a minority government. However, let no one think we are going to let any legislation or estimates pass through the house without proper and due consideration. I promise, particularly in connection with the budgetary resolutions, that they will receive the scrutiny and determined opposition that they deserve. They must not pass as they now stand.


Stanley Howard Knowles: Which ones?


Gordon Harvey Aiken: Even as revised, in reply to the question of the hon. member for Winnipeg North Centre (Mr. Knowles). We will have to determine which budget resolutions we have before us when we get to them. I have one final point to make with respect to the presentation of this appropriation bill. Much has been said about the budget and much will be said, but I think the people of Canada can be thankful for one thing, that the unsatisfactory budget that was presented on

June 13 this year has prevented another general election in 1963. I am convinced that the government planned, regardless of the consequences, to find an excuse to call another general election in 1963.


Some hon. Members:: Oh, oh.


Gordon Harvey Aiken: They believed-and wrongly, I am sure-that they could create in a few weeks a sufficiently rosy impression, without being called upon to perform-


Mr. Deputy Speaker:: Order. I am wondering whether the hon. member who now has the floor would not agree with me that he is at this point straying from the principle of the bill now before the house.


Gordon Harvey Aiken: Mr. Speaker, my reason for dealing with this matter is that we are discussing the business of the house and I was about to say-


Mr. Deputy Speaker:: Order. It is my understanding, not that we are discussing the business of the house but that we are discussing Bill No. C-86, which is an item of business before the house.


Gordon Harvey Aiken: I accept your decision on this matter, Mr. Speaker. I did intend to proceed to detail certain evidence which convinced me about this particular matter but I will let it pass in deference to Your Honour's ruling.
That pretty well disposes of that point, Mr. Speaker. I had a really good argument on this and I had the evidence, I think, to prove that this was the government's intention; but it is the ruling of the Chair that I am straying too far, and I will therefore desist. I conclude by saying that the Minister of Finance (Mr. Gordon) has done one good thing with his budget in that he has left the government in such bad shape that they will not dare go to the country for a long time.


John Whitney Pickersgill: Mr. Speaker, I had not intended to say anything in this debate. I know everyone says that. But I want to utter just two sentences in response to the speech we have just heard. The first is that in the 60 days before Christmas in the 1962 session of the 25th parliament 17 government bills were passed by the House of Commons of that time. If on the sixtieth day of this session-and we are at the forty second-there have also been 17 government measures passed, then I will congratulate hon. gentlemen opposite and say they have done just as well as we did in co-operating. But they have a lot to go to get to 17. That is my first sentence.


George Clyde Nowlan: That is two.


Gordon Harvey Aiken: Mr. Speaker, may I ask the hon. gentleman a question on this point?
15, 1963	2195
Approval of Expenditures, 1962-63


John Whitney Pickersgill: Yes.


Gordon Harvey Aiken: May I ask him how many matters the government now has on the order paper they are prepared to go ahead with, in view of the withdrawal of several items?


John Whitney Pickersgill: That would be out of order, Mr. Speaker. I will answer that question on another occasion. My second sentence is this, that this bill need not have been necessary at all if the previous government-I am saying nothing about the time before the 1962 election; of course, there was nothing to stop them bringing on their estimates and getting them all passed before they ever had the election in 1962, but I am not saying anything about that-after the election of 1962 if the previous government had followed the example of the present government and called parliament together promptly 38 days after the election; if they had followed this course, we would have had 63 additional days in which to deal with these matters. One hundred and one days elapsed between the election last year and the day parliament was allowed to meet. If that period had been used for consideration of the estimates, this bill need not have been brought before the house at all today.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Lamoureux in the chair.
On clause 1-Short title.
George Clyde Nowlan: Mr. Chairman, I wonder whether the parliamentary secretary could answer the question that I raised earlier this afternoon. I am not sure that he would have the figures here. I wonder what is the total amount of the statutory items for the fiscal year preceding this one, and the total amount of the statutory items which are excluded by the wording of the resolution. I have no particular reason for thinking he would have these figures, but he will understand that there is a difference between the two. They are not before us at all, and I am wondering just what effect they would have on the budgetary position.


Edgar John Benson: Mr. Chairman, I have here some estimates prior to the accounts being closed off completely.


George Clyde Nowlan: Unless you have the totals, there is not much point.


Edgar John Benson: The final supply bill here authorizes payments representing a total of $4,244 million, including $176 million on account of loans, investment advances and budgetary items. Therefore the payment is $4,068 million. To this has to be added the

2196
Approval of Expenditures, estimated expenditures incurred under continuing statutory authority. This covers such things as family allowances, pensions, debt charges, and so on. These were, as detailed in the revised estimates, $2,398 million, and the actual exceeded this by $150 million, making a total of $2,548 million for the non-budgetary items.


George Clyde Nowlan: Does the parliamentary secretary know what they were for the preceding year?


Edgar John Benson: I have not that figure, Mr. Chairman.


[Stage Direction]
Clause agreed to.
On clause 2-$853,162,680 granted for 1962-63.
George Clyde Nowlan: Mr. Chairman, I wonder what the procedure is going to be. Are we going through these item by item, with regard to the schedule covering them, or what is the proposal of the parliamentary secretary in regard to dealing with them?


Edgar John Benson: Mr. Chairman, I looked back at the precedent for this bill in 1958. The items were carried down through the clauses, and the schedule was then dealt with. It was dealt with by departments. The main headings of the departments would simply be called, rather than cover every item in the schedule, which itself amounts to some 38 pages. If this is agreeable to the house it would facilitate the passage of the bill.


Lucien Lamoureux: Is it agreed?


Some hon. Members:: Agreed.
Clause 2 agreed to.
Clauses 3 to 6 inclusive agreed to.
On the schedule.


Lucien Lamoureux: We will discuss the items for the Department of Agriculture.


Stanley Howard Knowles: Might I ask a general question first of all relating to the schedule. The schedule differs from the report on supply in that the report on supply gives additional information. I am wondering what the parliamentary secretary has in mind by way of a modus operandi so that we can ask some questions about these 36 items which are being authorized by this bill.


Edgar John Benson: Mr. Chairman, what I would propose, if it is agreed, is that as we go through the sections of the bill dealing with the various departments, hon. members wishing to ask questions should refer to the report on supply, as I think this would be a little easier. It is generally constituted in the same manner and in the same order as the

bill itself. For example, in agriculture, under "administration branch", it is the same as the report on supply.


Stanley Howard Knowles: Might I be permitted to ask a general overriding question with regard to these 36 items. This is money which has already been spent. How did it happen that it was not authorized either by an interim supply bill or by governor general's warrant?


Edgar John Benson: As I mentioned in my statement earlier, Mr. Chairman, the final estimates for last year were not presented at the end of the year. The government then obtained two governor general's warrants covering specific items. These 36 items were not specifically covered by those warrants and were picked up at the end of the year on March 31, 1963, and are now proposed in the final supply bill. They would presumably have been included in a final supply bill for last year had there been one.


Stanley Howard Knowles: Were they already in the estimates book for last year? They are not in the nature of supplementary estimates?


Edgar John Benson: No.


George Clyde Nowlan: Mr. Chairman, that is not quite correct. My hon. friend for Winnipeg North Centre referred to these moneys having been spent. Actually the majority of these items are bookkeeping items with regard to which no money is spent at all. They might or might not have appeared in the final supplementary estimates if they had been recommended by the minister of finance and approved by treasury board, and had then come before the committee of supply. But none of that action was taken prior to dissolution, and therefore none of these items actually appeared in the final supplementary estimates.


Edgar John Benson: Yes, that is right.


Horace Andrew (Bud) Olson: Mr. Chairman, I take it you have called the Department of Agriculture on the schedule?


Lucien Lamoureux: Yes.


Horace Andrew (Bud) Olson: I should like to ask the parliamentary secretary to the Minister of Finance whether he could give us a little more information with regard to vote No. 163, a matter of $71 million required to recoup the agricultural commodities stabilization account to cover the net operating loss of the agricultural stabilization board as at March 31, 1963. First of all, is this just a bookkeeping item to take care of losses which had accumulated, and did this accumulation occur during the fiscal year from April 1, 1962 to March 31, 1963? Then, of course, the other

point which I brought up earlier was that no part of this was authorized by interim supply motions or by special governor general's warrants.


Edgar John Benson: Mr. Chairman, this item is placed each year in the final supplementary estimates to credit to the account an amount equal to the net operating loss incurred during the fiscal year in carrying out the price stabilization program. Its inclusion will ensure the charging of a loss to the appropriate fiscal year in the accounts. The year of the price stabilization board is to March 31 of each year, so that it would cover the loss of the stabilization board from April 1, 1962 to March 31, 1963.


Horace Andrew (Bud) Olson: The public accounts, I presume, will show a detailed explanation of which commodities incurred these losses?


Edgar John Benson: Yes, I would think that would be in the public accounts. If it is not published in the public accounts I will make the information available to the hon. member. I have it all here and could table it if he so requires.


Mr. Howe (Wellinglon-Huron):: Mr. Chairman, I want to raise a point in connection with some of the items I have looked at. For example, vote 143 in the Department of External Affairs indicates that a certain amount was taken to reimburse the agricultural stabilization board for the shipment of skim milk powder and canned pork to refugees in Hong Kong. Then in the next item there is an amount voted to reimburse the agricultural stabilization board for skim milk powder donated to international relief agencies. In the net amount paid to the agricultural stabilization board, were these amounts paid through the Department of External Affairs deducted? Is this the final net amount after these amounts were taken off?


Edgar John Benson: Yes, that is so with regard to the purchase and transportation of this milk to Hong Kong. It is customary to include in the final supplementary estimates items such as this which represent the cost of supplies donated to international services, for which the agricultural stabilization board is paid, in effect, by the Department of External Affairs.


William Marvin Howe: And this is the amount after that amount has been deducted?


Edgar John Benson: Yes, it is net.


Horace Andrew (Bud) Olson: Mr. Chairman, inasmuch as the public accounts will not be out yet for some time and the parliamentary secretary said
15, 1963
Approval of Expenditures, 1962-63 that he had this information available now, I wonder if he would undertake to send me, either today or very soon, the information he has?


Edgar John Benson: Yes, I will undertake to do that.


George Clyde Nowlan: Would the parliamentary
secretary give me a breakdown-if he cannot do so now perhaps he could do so later- of item 100, which is the one dealing with premiums for hogs and lambs? I have a distinct recollection that some changes were made in the original estimates concerning this matter, and I am wondering whether the original estimates included this or whether it was the actual cash, if any, which was paid out. These premiums were disallowed for some time and then they were reinstated. I should like to see a breakdown of item 100.


Edgar John Benson: Yes, I will undertake to
get that.


Lucien Lamoureux: Shall the agricultural items carry?


Some hon. Members:: Carried.


Lucien Lamoureux: We now go to page 6 of the schedule, the atomic energy items.


George Clyde Nowlan: I wonder whether the parliamentary secretary would explain the item of $25,239,005. I am sure it comes as a great surprise to him that I should ask this question, but the item deals with a write-off on the NRU reactor. It is not a cash item but a bookkeeping entry, I would assume, which the government found convenient to add to the expenditures of this fiscal year.


Edgar John Benson: I could explain this briefly or go into some detail, depending on what the hon. gentleman wishes.


George Clyde Nowlan: You might be brief, but you will not convince me anyway.


Edgar John Benson: Basically, what happened in this situation was that a reactor was built by the government of Canada, under the atomic energy commission, to produce plutonium to be sold to the United States under a long term contract. The price under this contract was to be renegotiated as of June 30, 1962. During the initial period of the contract the price was sufficient to provide funds toward the amortization of the cost of the reactor. In June 1962 when the contract price was to be renegotiated the United States was in the position where they had ample domestic supplies of plutonium. So the price which was obtainable was much lower and would not permit covering both the operating expenses of this reactor and its further amortization. At this point the atomic energy

Approval of Expenditures, 1962-63 commission was left in a position where it had this reactor on its books at some $25 million and there was no possibility of writing it off, due to the lower price which had been obtained under the new contracts. In these circumstances it was decided that this item should be written off as a charge against general revenue.


George Clyde Nowlan: You are still using this reactor?


Edgar John Benson: It is still being used, but there is no possibility of its amortization in the usual way.


Lucien Lamoureux: Department of External Affairs is next.


Herbert Wilfred Herridge: I apologize for detaining the house for a few minutes on this item, but I rise to discuss a matter which I consider to be of primary importance with respect to our national integrity and the future unity of this nation. Before proceeding with my remarks I wish to quote from a book which has been distributed to hon. members. It is entitled, "Organization of the Government of Canada" and it is published by the queen's printer under date of January, 1962. I quote from page 158 with respect to the functions of the Department of External Affairs:
The main functions of the department are the conduct of official relations between Canada and other countries and of Canadian participation in international organizations, and the protection of Canadian interests abroad.
Then, on page 159, I read:
There is also an economic division which deals with all financial, commercial and general economic questions possessing international implications, in co-operation with the departments of finance, trade and commerce and other bodies concerned.
And on the same page:
The legal division advises on questions of international law, including the interpretation of treaties. It is responsible for liaison with the Department of Justice. Besides its general section, it comprises a treaty section, which assists in the preparation of international agreements, and a claims section, which deals with claims of Canadians against foreign countries.
I have discussed this question with some very well informed people and I have had telephone conversations-I get a lot of telephone calls on various questions-and I have had correspondence. I raise this question because I have been requested to do so by some very important people in Canada and by those who are concerned about the actions of this government. I am reliably informed that a former prime minister, the Right Hon. William Lyon Mackenzie King, was most particular with respect to the observance of protocol in the conduct of official relations between Canada and other countries. I am informed he had such strict regard for the recognition of Canada as a sovereign state

and for the sole right of the government of Canada to conduct official relations and negotiations with other countries on any question that, while he consulted with and sought the advice of provincial governments on matters affecting their provinces, he always insisted that officials or representatives of the government of Canada should be the only persons present during negotiations with another country. I am also reliably informed that former prime minister Louis St. Laurent held the same view and insisted on the same practice. I am further advised that in reaching agreement on the St. Lawrence seaway the same practice was followed. Though the provinces were consulted and their wishes considered, the negotiations were carried on by the representatives of the government of Canada.
Indeed, so firmly fixed is the sovereign right of Canada to negotiate treaties and agreements that on several occasions the government of Canada has disallowed provincial legislation on the ground that it affected Canada's relations with other countries, a field which is the prerogative of the federal government, as established by law as well as by practice. For instance, there was some legislation passed at one time by the government of British Columbia with respect to orientals which was disallowed by the federal government on this basis. Later, there was some legislation passed by the government of Manitoba which was disallowed because it was considered an interference with the sovereign right of the government of Canada to deal with any matter affecting its relations with other nations.
I do not know whether hon. members have suspected it or not, but I am coming to a point. I wish to deal with what has happened with regard to the Columbia river treaty. Let me tell the committee what is happening to break down the precedent and practice of former years. Premier Bennett informs the public through the press that Robert Anderson, former secretary in the Eisenhower administration-a man who claimed to have President Kennedy's ear-is his adviser on the Columbia treaty question. In effect, Premier Bennett is telling us that Mr. Anderson is a go-between operating between the government of British Columbia and the government of the United States or its agencies concerned. In the second place, Premier Bennett goes to Washington, it is widely advertised in the press, to negotiate directly with officials of the United States with respect to the Columbia river treaty, or with agencies of the government of the United States on details relating to the Columbia river negotiations, and in particular the price to be paid for power. These matters are the responsibility of the

federal government. They are the responsibility of the federal government according to tradition, precedent and practice. It is this government which should conduct the negotiations, giving effect to the wishes of the province so long as they do not transgress the national interest. When it comes to negotiations between Canada and another country, the federal government must take the responsibility.
What is hapening now has all been done with the obvious, though tacit, agreement of the government of Canada. Without a doubt, in view of the statements made by Premier Bennett to the press, the silence of this government means consent. It is a well known and well established practice that the government of Canada cannot delegate its powers with respect to external affairs or its dealings with foreign nations.
What is the latest act in this drama? We find that recently Mr. Avery Peterson, the United States consul-general in Vancouver, visited the Columbia riding during the provincial by-election. I am informed that while he was there he attended political meetings and took copious notes of what speakers for the New Democratic party and others had to say. He visited around, held conversations with people and all the rest of it. In our opinion, and in the opinion of a good many people, this was in extremely bad taste, especially in view of the particular issue which was concerning the electorate of that riding at that time. His presence was resented by some people including some of the electors. Others considered it a subtle form of influence brought into the campaign at the instigation of Premier Bennett. We object to the use of officials of the American state department to influence the electors of British Columbia in a provincial by-election.
Newspapers use the phrase "Bennett-United States negotiations" and correspondence refers to the same thing. This clearly indicates that a good many people are of the opinion that the government of Canada has surrendered its sovereign rights in this respect and has said to Premier Bennett of British Columbia:	You go ahead and do the
negotiating. We object to this practice.
I will just make reference to the law in the United States. The government of the United States is very jealous of its federal powers and under its constitution no state is permitted to deal with any foreign power. I have looked into the matter and I have the book here, but I am not going to take the time of the house to refer to it. When an ordinary stump rancher starts to wander through legal tomes, Mr. Chairman, he has got a task on his hands, however I spent
Approval of Expenditures, 1962-63 yesterday afternoon reading up on this subject. I find that the United States will not tolerate any executive or official of a state government dealing in any manner with any other country. Under the oath of office taken by the executives of state governments they take an oath to the constitution and to abide by this principle, and if they violate that oath of office by overstepping the responsibilities of the state government and transgressing the rights and responsibilities of the federal government they can be impeached.
In my opinion, Mr. Chairman, first of all the government has departed from the established and recognized procedure and practice in its negotiations with the government of the United States and the government of British Columbia with respect to the Columbia river treaty, and I am not alone in that view. Second, it has by its tacit agreement with Premier Bennett's direct negotiations with officials of the government of the United States or its agencies surrendered its sovereign rights and has violated a principle that has been given effect throughout the years by tradition, by practice and by procedure. Third, by so doing it has established a precedent that will promote the balkanization of Canada and sow the seeds of national disunity in the days ahead. Just imagine if each provincial government, accepting the procedure that has been recognized and accepted so far as Premier Bennett is concerned, started to trot off to Washington or some other country to deal directly with officials or agencies of that country, rather than such negotiations being carried on in the regular or recognized way.
In conclusion, Mr. Chairman, I want to protest this government's surrender of its sovereign powers and its delegation of these powers to the government of British Columbia, particularly to Premier Bennett. I want to protest on behalf of this party this weak-kneed avoidance of responsibility in this most important matter. Finally, I say to the government: Stand up for Canada, represent Canada, and let us keep Canada a nation by so doing.


Mr. Crouse:: On page 15 of the supply report under bilateral economic aid programs there is an item of $3,458,333 for the Colombo plan. Could the hon. gentleman piloting this measure through the house give us a little more information on what this expenditure entailed?


Edgar John Benson: This is included to maintain the proper distribution between the fiscal years 1962-63 and 1963-64 of credits to the fund and to bring before parliament a supply bill for 1962-63 to authorize payments that would have been authorized in that year if it

Approval of Expenditures, 1962-63 had been a normal one from the point of view of supply. Normally this would have been in the final supply bill which was not presented during the past fiscal year.


Some hon. Members:: Carried.


Lucien Lamoureux: Carried. Finance?
Seme hon. Members: Carried.


Lucien Lamoureux: Carried. Page 12, fisheries.


George Clyde Nowlan: What is that item of $134,334?


Edgar John Benson: This has to do with operations under the fisheries indemnity plan during the year 1962-63. I have a brief table here which I could read. The total deficit in the accounts as of April 1, 1963 was $23,976. Vessel indemnities paid were $302,978 whereas premiums received were $222,265, leaving a net cost of $80,713. Lobster trap indemnities paid were $174,754 and premiums were $22,109 leaving a net loss of $152,645. These add to total deficit of $257,334 of which governor general's warrants authorized reimbursement to the amount of $123,000 leaving this balance of $134,334 to be reimbursed.


George Clyde Nowlan: It is just a transfer of accounts and some bookkeeping entries?


Edgar John Benson: Yes.


Lucien Lamoureux: Shall fisheries carry?


Some hon. Members:: Carried.


Lucien Lamoureux: Carried. Forestry?


Some hon. Members:: Carried.


Lucien Lamoureux: Carried. Governor General and lieutenant governors?


Some hon. Members:: Carried.


Lucien Lamoureux: Carried. Insurance?


Some hon. Members:: Carried.


Lucien Lamoureux: Carried. Justice?


George Clyde Nowlan: There is an item there of $51,140 but I am not sure whether it comes under justice or penitentiaries. Is that for breakage at St. Vincent de Paul?


Edgar John Benson: There are two items, one of $51,140 and another approximately $5,000. They arise out of the uprising at St. Vincent de Paul and their purpose is to reimburse the inventory account for losses.


George Clyde Nowlan: We are being charged with the estimated losses in the inventory accounts following the riots at the penitentiary?


Edgar John Benson: Yes.


Lucien Lamoureux: Carried. Labour?
Seme hon. Members: Carried.


Lucien Lamoureux: Carried. Mines and technical surveys?


George Clyde Nowlan: Does the Northern Canada Power Commission come under this?


Edgar John Benson: Under northern affairs.


Some hon. Members:: Carried.


Lucien Lamoureux: Carried. Page 19, national defence. Carried?


Some hon. Members:: Carried.


Lucien Lamoureux: Carried. Page 20, national film board. Carried?


Some hon. Members:: Carried.


Lucien Lamoureux: Carried. National gallery of Canada.


Mr. Monteilh:: I wonder whether the parliamentary secretary could give us an idea how this extra amount came to be required for the purchase account?


Edgar John Benson: I mentioned this in my speech and I think it is recorded in Hansard. There are several amounts which are included here to bring up the contributions to these particular funds to the amounts that were decided upon in the supplementary estimates for the year, including the estimate that was not tabled, so that the contributions would be the total amount that it was intended to contribute for that particular purpose in the year. It is not a specific expenditure in the year but it was decided that a certain amount would be contributed to the national gallery, and this is to bring it up to the full amount.


George Clyde Nowlan: It is a bookkeeping entry?


Edgar John Benson: It involves cash.


Some hon. Members:: Carried.


Lucien Lamoureux: Carried. Page 20, national health and welfare.


Mr. Pascoe:: On page 20 it refers to health services, including assistance to the provinces, and on page 21 there is reference to hospital construction grants. Could that be broken down into the individual grants for the various provinces?


Edgar John Benson: Pages 20 and 21 of the bill?


James Ernest Pascoe: Yes.


Edgar John Benson: I am sorry, but I do not have it available. I will undertake to get it for the hon. member if he requires it.


Lucien Lamoureux: Page 21, national research council, shall it carry?


Some hon. Members:: Carried.


Lucien Lamoureux: Page 22, national revenue?


Some hon. Members:: Carried.


Lucien Lamoureux: Northern Affairs and National Resources?


George Clyde Nowlan: There is one item here about which I should like an explanation from the parliamentary secretary. I refer to the item relating to the Northern Canada Power Commission, $7,004,000; is that a write-off or a transfer of some kind?


Edgar John Benson: The Northern Canada Power Commission agreed to construct certain installations, other than of a power nature, at Inuvik, in the Northwest Territories, on the undertaking that the federal government would reimburse them for the amount. There were non-interest bearing loans made during the period of construction. During the last fiscal year, construction was completed and this is the amount brought forward to reimburse them. Construction extended over a long period and advances were made, for instance, as far back as 1957-58 when there was $1 million advanced and in 1958-59, $5 million. These were advanced as non-interest bearing loans.


George Clyde Nowlan: This is a crown corporation and there was a transfer from one book to the other?


Edgar John Benson: Yes.


Marcel Joseph Aimé Lambert: During those years, was
there no regular period of amortization advanced, or was this just at call?


Edgar John Benson: No, the crown made non-interest bearing advances so that the work could be carried out.


Marcel Joseph Aimé Lambert: Yes, but the reduction is by the crown of Canada?


Edgar John Benson: All that is involved is that the crown paid out money over several years. Now, the crown is writing it off because it is not going to receive it back. This work was being done for northern affairs.


Marcel Joseph Aimé Lambert: I realize that, but I wondered if there was a regular program of amortization under which a crown company was carrying it or whether your bonds or indebtedness were designed to be chargeable to current account, in which case one could readily accelerate any future indebtedness so that it all fell in, in one year. This is my reason for asking if there was a program of amortization.


Edgar John Benson: The terms required under
section 3 (a) of order in council P.C. 1957-36/626 required that upon completion of construction of these facilities, the Northern Canada Power Commission would be reimbursed in respect thereof. Construction has been completed since March 31, 1962 and Northern Canada Power Commission invoiced the department for the total amount of $7,003,914.
Approval of Expenditures, 1962-63


Marcel Joseph Aimé Lambert: That is the obligation I was looking for.


Lucien Lamoureux: Page 26, post office?


Some hon. Members:: Carried.


Lucien Lamoureux: Privy council?


Lloyd Roseville Crouse: On page 27 there is an item covering payments to the national centennial fund to enable grants to be made to the provinces for local projects of a lasting nature. Could the parliamentary secretary tell the committee which provinces required this money so urgently?


Edgar John Benson: I will need a moment to look it up. Basically, these are contributions being made on an annual basis to this fund. This was one of the items to bring up the total contribution in the fund to the amount agreed for the current fiscal year. The actual amounts given out to the provinces, if any,
I would have to ascertain. As I said, this is an amount contributed to the fund at the end of the fiscal year to bring it up to the amount agreed upon.


Lucien Lamoureux: Shall the privy council item carry?


Thomas Clement (Tommy) Douglas: There is an item here for the prime minister's residence, $23,930. This is a rather delicate matter which I am sure the government itself cannot raise. However, I think it ought to be raised, and some members ought to pay some attention to it. Originally, when the prime minister's residence was set up, at the insistence of the prime minister at that time, there was a provision that the prime minister would pay $5,000 a year for the privilege of living in the prime minister's residence. Naturally, the wishes of the prime minister at that time were respected. The fact is that this must impose a very serious burden on whoever is prime minister of Canada. I am told that the prime minister not only pays to live in the house but he must also hire his own chauffeur to drive his own car. I know he gets an allowance towards his car, but it would not begin to meet that kind of expense.
I am making the suggestion to the government that when they are drafting the estimates for next year, it seems to me that this ought to be re-examined. I think the time is overdue when we should take this item out of the legislative requirements and allow the prime minister to live in that house, as he ought to be allowed to do, without having to make any payments. Certainly, if he has, in addition, to hire a chauffeur and buy his own car, that is a burden. The prime minister cannot drive an ordinary car like the rest of us drive. He needs one that is commensurate with the dignity of the office

Approval of Expenditures, 1962-63 which he holds. Now, I do not believe hon. members want to impose that kind of burden upon any prime minister of this country. I should like to say, and I am sure most members of the house would agree, that if the government when they are bringing down their estimates for the next fiscal year, eliminated this $5,000 requirement and made some provision for supplying a chauffeur, that would meet with general approval.


Edgar John Benson: I wish to thank the hon. mem-oer, and I will undertake to bring these remarks to the attention of the Minister of Finance who, I am sure, will bring them to the attention of the government.


George Clyde Nowlan: There are other charges that should be borne in mind, and I am sure the government will bear them in mind. There is the fixed amount of rental paid, the supplying of a car and chauffeur, and then there are payments made to the national capital commission for the maintenance of the grounds and gardens. These payments run into a substantial amount during a year, and I think all this should be considered at the appropriate time, and some changes made.


Lucien Lamoureux: Shall privy council carry?


Some hon. Members:: Carried.


Lucien Lamoureux: Public archives and national library?


Some hon. Members:: Carried.


Lucien Lamoureux: Public printing and stationery?


Some hon. Members:: Carried.


Lucien Lamoureux: Public works?


Mr. Rapp:: I should like to direct attention to item 45, construction of buildings in Saskatchewan. Were there any R.C.M.P. barracks constructed in the following towns of Wadena, Melfort and Humboldt?


Edgar John Benson: These are last year's estimates. I could not say whether they are included in here or not. I would have to look.


Miss LaMarsh:: It is your constituency; don't you know?


Reynold Rapp: I know.


Lucien Lamoureux: Shall the public works item carry?


George Clyde Nowlan: No.


Mr. Winch:: Since these are last year's estimates I should like to take one minute and ask the sponsor of the bill if he will have a little talk with the Minister of Public Works. A contract which was let under last

year's estimates related to the construction of a concrete wall at the maximum security section of St. Vincent de Paul penitentiary. I, along with two other hon. members, spent last Friday there. The wall is completed. There are over 70 men in the segregation section of this maximum security institution. They have not been out of their cells for weeks on end. The reason they have not been out for weeks on end-they are the roughest, toughest, criminals in Canada-is that public works has not seen to it that the contractor supplied a pair of hinges to be put on a gate in that wall. The Department of Justice cannot do a thing about it. So, you have a position where the groundwork is laid for suicide and murder because of the lack of hinges on a contract that was let by the Department of Public Works.
I am very grateful for having the opportunity of raising this matter right now, because the three of us spent all day on Friday going through that place. They are asking for trouble when they have some of the worst criminals in Canada incarcerated inside cells, without a break for weeks on end. They cannot get even a half hour's exercise in the prison yard because the Department of Public Works contractor has not come up with a pair of hinges. I ask that something be done about it quickly.


Edgar John Benson: I will be most pleased to bring this matter to the attention of the Minister of Public Works.


Lucien Lamoureux: Shall the public works items carry?


George Clyde Nowlan: There are one or two questions I would like to ask with respect to Central Mortgage and Housing Corporation, which comes under public works. Item 206 deals with reimbursement on dominion-provincial projects to the extent of $754,794, and item 208 deals with losses sustained on the operation of federal-provincial projects of $1,204,939. On looking up the revised estimates for these items I notice that the treasury board decided neither one of these items would be necessary for this year, and I now wonder why they are included again in the estimates.


Edgar John Benson: The notation I have on this is that each year there is included in various supplementary estimates an amount representing the value of expenditures on community planning and grants to universities and other research agencies to restore the capacity given under the National Housing Act, and to bring the programs before parliament for review. I have the final supplementary estimates with regard to 1962-63, including this amount of $754,794, and I have the

analysis of the expenditures. This breakdown I could let the hon. member see and it would explain the total of $754,794.
Similarly with item 208, in accordance with the usual practice this item is included to obtain the sanction of parliament for the reimbursement to the corporation of losses sustained by it in 1962 in the operation of federal-provincial projects across the country. I have a list of the projects here on which losses were incurred, and they total $1,204,939, which is requested in this particular item.


George Clyde Nowlan: All I am saying is that the final supplementary estimates have not omitted these. They were deleted in the revised estimates submitted to the house some months ago, and they were struck out by treasury board as being unnecessary for this year. Presumably they may have been incorporated in some preceding year, and in the setting up of these final estimates somebody has copied the items which appeared before without checking to see whether they were deleted.


Lucien Lamoureux: Shall the public works item carry?


Marcel Joseph Aimé Lambert: Subject to the caveat by the hon. member for Digby-Annapolis-Kings, perhaps the parliamentary secretary could file the particulars with respect to these amounts because they are brand new items.


Edgar John Benson: I will undertake to file particulars with respect to these items.


Mr. Barnett:: Could we get some information on the point raised by the hon. member for Digby-Annapolis-Kings. I was going to ask the parliamentary secretary whether these were items that would normally appear in the supplementary estimates for the year that was passed?


George Clyde Nowlan: They are not in this year; I can assure you of that.


Thomas Speakman Barnett: We all understand that the hon. member for Digby-Annapolis-Kings has some special knowledge of the situation, and he has suggested that those items were not in the final supplementary estimates and in his view, and in the view of the government of which he was a member, they would not have been in these accounts had we not had a change of government. This is something that we would be interested in seeing clarified.


Edgar John Benson: These are funds that were laid out by Central Mortgage and Housing Corporation, and it is a matter of when you reimburse them for it. Is that not correct?


George Clyde Nowlan: They are bookkeeping entries, I suppose.
15, 1963
Approval of Expenditures, 1962-63


Edgar John Benson: With regard to item 206, under section 35 of the National Housing Act the minister may reimburse the corporation out of the consolidated revenue fund, and in general the provisions include technical research, such as into the construction and designing of houses. Expenditures for the period April 1 to December 31, 1962 by Central Mortgage and Housing Corporation in this respect were the total I have indicated of $754,794, and the corporation has to be reimbursed for this, and it is therefore necessary to bring it into the final supply bill.
Similarly with item 208, it is to reimburse the corporation for losses sustained by it during the calendar year as a result of the operation of federal-provincial projects undertaken under section 36 of the National Housing Act. During the calendar year 1962 Central Mortgage and Housing Corporation made reimbursements for losses sustained as the result of operating federal-provincial projects in the various provinces to the amount of $1,204,939, and it is now being reimbursed this amount. It has been paid it and it is therefore put in the final supply bill.


Thomas Speakman Barnett: It would seem logical to me that if at some point a loss is sustained parliament should be asked to approve the reimbursement. I was a bit puzzled by the remarks made by the hon. member for Digby-Annapolis-Kings.


Edgar John Benson: There will be a similar item in the final supplementaries for the current fiscal year, 1963-64.


James Ernest Pascoe: Under item 209 I wonder if the parliamentary secretary could oblige me in the same way he did before, and give a list of the municipalities which have benefited by this forgiveness.


Edgar John Benson: I would be most pleased to table this information, which I have.


Lucien Lamoureux: Shall the items carry?


Some hon. Members:: Carried.


Lucien Lamoureux: Page 30-Royal Canadian Mounted Police. Shall the items carry?


Some hon. Members:: Carried.


Lucien Lamoureux: Secretary of State; shall the items carry?


Some hon. Members:: Carried.


Lucien Lamoureux: Trade and commerce. Carried?


Some hon. Members:: Carried.


Lucien Lamoureux: Transport; shall the items carry?

Approval of Expenditures, 1962-63


Marcel Joseph Aimé Lambert: With regard to item 26 is there provision for the write-off of the value of land purchased for development of the Cornwall canal navigation system?


Edgar John Benson: I would be pleased to comment on this. This was some land that was purchased with a view to doing further work on the Canadian St. Lawrence seaway through that portion of the country. The land is carried both on the books of the government of Canada and the books of the St. Lawrence seaway commission. As it is not usual for the government of Canada to carry land as an asset on its books, the Auditor General, over a two year period, has recommended that this asset be written off to general revenue by the government of Canada. It of course remains on the books of the St. Lawrence seaway commission. This is a bookkeeping entry, really, to write off the particular land value as it is shown in the records of the government.


George Clyde Nowlan: Could the parliamentary
secretary tell us when the land was purchased?


Edgar John Benson: I could, if I looked it up. It was several years ago.


George Clyde Nowlan: It was purchased a few years ago?


Edgar John Benson: That is right.


George Clyde Nowlan: And it was decided this year to write it off?


Edgar John Benson: Yes.


George Clyde Nowlan: I have one other question on this matter, Mr. Chairman. My hon. friend was asking the question a while ago as to how these items came in. I would ask the parliamentary secretary to look at vote 35 of the Department of Transport. That is now shown in the report on supply as $3,757,000, and we are making up the difference. The revised estimates which were tabled in the house-and with which I had something to do, as well as other hon. members here-show that amount as being reduced to $3,250,000, and it appears right here. I suggest there has not been a cent of this money spent; it is a bookkeeping entry. Regardless of the fact that the government, treasury board and everyone else spent weeks in revising and bringing down a new set of estimates, we have the old, original amount. They have not even bothered to look at the revised estimates, wherein this amount was reduced to $3,250,000 from $3,757,000. Therefore we get this additional amount charged up against the government for this year.
[The Chairman.]

I say this is not only a bookkeeping entry but it is one which is a reflection on parliament, because of the estimates which were brought down and which have been lying on the table for months. Those estimates have now been changed by someone and we are charged with an item that has no justification whatsoever.
We are told, in regard to some of them, that they could be in the final estimates that we never brought down. This particular estimate was brought down; the book of revised estimates was brought down. The same thing applies to the other items to which I referred a few moments ago. The item in the revised estimates said this amount was not needed, but we have it before us again today. Again, Mr. Chairman, this is an example of putting in figures which will add up for this government and for which the preceding government will be held accountable in the final accounting.


Edgar John Benson: I disagree with this, Mr. Chairman-


George Clyde Nowlan: Let me ask the parliamentary secretary this question. Has the parliamentary secretary the revised estimates in front of him; and if he has, what is the amount for this item?


Edgar John Benson: Does the hon. member mean the final supplementary estimates which were never tabled?


George Clyde Nowlan: No, I am asking about the revised estimates, which were tabled.


Edgar John Benson: I have them in my office, Mr. Chairman, but not here. With regard to this particular item and the $507,700 which is added here, which I presume is the amount about which the hon. member is talking, this amount required to cover the balance owing to the national harbours board for dredging done by that organization in Montreal harbour for D.O.T. Originally the cost was to be spread over a two year period, but because of the availability of dredging equipment, MacNamara Marine Limited, the contractor, completed the project last fall. There were approximately 925,076 cubic yards removed at $1.10 per yard, for a total cost of $1,017, 584. The ship channel had already paid the national harbours board $509,933, and the amount shown is for the balance of $507,651 which was owing and has been paid.


Horace Andrew (Bud) Olson: Mr. Chairman, I would direct the attention of the parliamentary secretary to the item under vote No. 214 on page 61 of of the report on supply, and on page 35 of the bill. Before I put this question to him I would like to express my sympathy to the

parliamentary secretary for having to answer for the sins of omission and commission of the previous government.


Some hon. Members:: Hear, hear.


Horace Andrew (Bud) Olson: I would like to know when the $16 million under this item was paid, because as is indicated in the report on supply no part of it was voted on the interim supply bills that were brought in from time to time during the last parliament.
When we turn to the new estimates which have been tabled for this year, we find that while the $50 million grant to the railways under vote No. 213 is acknowledged and recorded as a decrease in the current fiscal year, the $16 million paid under the Freight Rates Reduction Act is not even acknowledged as a decrease from the previous fiscal year in comparison with this year. I was wondering how it got in there. I presume it was authorized by governor general's warrant, but I am wondering why it was not acknowledged as a decrease. The other thing I would like to know is, what is the government's intention for this fiscal year with respect to the $50 million paid last year under vote 213 and the $16 million that was paid under vote 214.


Edgar John Benson: Mr. Chairman, I wish I were the former minister of transport so I could tell the hon. member why this was paid and exactly when it was paid. All I can tell him is that it was paid under governor general's warrant. Presumably it was paid after the dissolution of parliament last February 6, so it would be paid in one of the two governor general's warrants which I believe were dated February 8 and March 4. It would have been paid at that time. In this year's estimates these two items, the $50 million and the $16 million, are grouped together, I believe, although I prefer not to discuss this coming year's estimates at this particular point.


George James McIlraith: That is right; they are grouped together.


Horace Andrew (Bud) Olson: Mr. Chairman, I realize the parliamentary secretary's reluctance to discuss this year's estimates. But if he looks at page 409 of this year's estimates he will find there is an item for $50 million listed as a decrease. It is not actually $66 million; it is an even $50 million, which I presume is the $50 million paid last year under vote 213. There is not in the current year's estimates even an acknowledgement that it was paid last year.


John Whitney Pickersgill: Mr. Chairman, perhaps the hon. gentleman would look at the supplemen-
Economic Council of Canada tary estimates, where he will find the item, I think. They were tabled in June.


George Clyde Nowlan: Mr. Chairman, I have one more question on transport. I suppose the write-off of loans to the harbours commission is in the same category as the other writeoffs?


Edgar John Benson: Yes, Mr. Chairman. I mentioned this in my speech earlier, the hon. member for Digby-Annapolis-Kings will recall. I said there was an amount of $284,700 which was lent to the harbour commission of New Westminster, British Columbia, to be used, as I recall it, to link some islands together for an industrial development; a bridge was to be built and a causeway. Ultimately this development did not occur, the government decided this money is not recoverable and therefore it has been written off.


Lucien Lamoureux: Shall the transport items carry?


Some hon. Members:: Carried.


Lucien Lamoureux: Shall the veterans affairs items carry?


Some hon. Members:: Carried.


Lucien Lamoureux: Shall the loans, investments and advances items, page 38, carry?


George Clyde Nowlan: They do not affect the budget.


Some hon. Members:: Carried.


[Stage Direction]
Schedule agreed to.
Preamble agreed to.
Title agreed to.
Bill reported.
Mr. Deputy Speaker:: When shall the said bill be read the third time?


John Whitney Pickersgill: Now, by leave.


George Clyde Nowlan: By leave.


Stanley Howard Knowles: By leave.


John Whitney Pickersgill: the third reading of the bill.
Motion agreed to and bill read the third time and passed.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 7 p.m.


[Stage Direction]
The house resumed from Thursday, July 11, consideration of the motion of Mr. Lamon-tagne for the second reading of Bill No. C-72,
[Stage Direction]
Economic Council of Canada to provide tor the establishment of an economic council of Canada.
Miss Pauline Jewett (Northumberland):: Mr. Speaker, I should like to talk about what this economic council is to do and what its chief purposes are. I shall do this in a fairly general way because I realize that there will be a closer discussion in the committee stage on the clauses of the bill. I shall focus my attention primarily on the first two of the three purposes which were outlined on Thursday last by the President of the Privy Council. The first purpose is that of economic research, forecasting and planning. The second is making policy recommendations on the basis of this research, forecasting and planning. The third purpose is to take over the functions of the national productivity council, which I believe is pretty well understood. In any event this will no doubt be discussed by others, so as I say, I shall restrict myself to the first two of the council's functions. In the course of doing this I should like to compare the role of the council, to some extent at any rate, with the proposed national economic development board introduced by the Conservative government in the last session.
The first duty of the council is to initiate and conduct basic research on all aspects of our economic life, and in particular to assess fairly regularly the medium term and long term prospects of the economy, and to compare such prospects with the potentialities of growth of the economy. It is also to study how economic growth, technological change and automation and international economic change may affect employment and incomes in Canada as a whole, in particular areas of Canada and in particular sectors of the economy, as well as the study of several other matters which are explicitly set out in the bill. These areas of study and research are set out more specifically in this bill, incidentally, than they were in the national economic development board bill introduced last session, and they are much more comprehensive. It seems to me, therefore, that the advice and recommendations which arise out of this basic research will be much more valuable. This is, then, the first distinction to which I would draw hon. members' attention between this bill and the one introduced in the last session.
I should think there is nothing very controversial about this provision for the collecting, co-ordinating and analysing of basic economic data. The only wonder is that it was not done years ago on a systematic and comprehensive basis. Actually, work of this kind was done during the latter war and early post-war years, particularly, it will be recalled, under the auspices of the department of reconstruction. Much of this work culminated in the federal government's well
[Mr. Pickersgill.l

known green book proposals. But as the boom of the mid and late forties came upon us, it seems to me that there was less inclination to probe into the problems and prospects of our economy, and I suppose this was natural enough. After all, why probe when it looks as though everything is going pretty well?
However, by the mid fifties concern was again shown about the prospects of the economy and some of its basic problems, and this led to the appointment of the royal commission on Canada's economic prospects and the very valuable studies which it conducted. In the years that followed, despite the host of acute economic problems that arose, many of which had been foreseen in the Gordon report, the government of the day, it seems to me, showed little inclination for the kind of continuing economic research and analysis on a systematic and comprehensive basis which seemed, to this party at any rate, to be urgently required. A certain amount of basic, fundamental research has for some years now, it is true, been conducted in a few of our departments of government. For example, in the economics branch of the Department of Trade and Commerce shortterm economic forecasting is carried on. But as the Glassco commission points out, the basic research which has been done in recent years has hardly been sufficient to build up adequate or profound knowledge of our economy.
There are various ways of getting more basic research done. For example, you could have a series of royal commissions. This is what Sweden used to do for its basic economic analysis and forecasting. I believe there was a commission for every period for which there was to be a plan. This has since been abandoned; but that is one way in which it could be done. Or you could try to have more basic research and analysis done in the various departments of government most concerned; or you could have a single research unit located in one department, possibly the Department of Finance.
I think, however, that the proposal for an economic council is best partly because it has other functions to perform apart from basic economic research. Even in the field of basic economic research I think it is the best kind of organizational set-up we could have. There is a tendency to let the economists who are employed in the various departments of government do the basic research last. It is regarded as something of a luxury, though it should not be. This is not at all likely to be the case in relation to special economic agencies. Furthermore, I think we are likely to get a sympathetic approach from the

senior people on the council, as it is constituted with the idea that research should be conducted on a systematic and continuing basis. Their attitude might be more sympathetic than in particular departments of government which are preoccupied from day to day with their own problems and with the carrying out of policy.
Much will undoubtedly depend, as the hon. member for Port Arthur (Mr. Fisher) said, on the calibre of the chairman and of the full time members of the council. I think it is extremely important that these should be highly qualified persons with a great deal of knowledge in this field.
There is another reason why the council is a good idea, and this leads me to the second part of its first duty, namely, on the basis of its economic analysis and forecasts, the drawing up of an economic plan or plans. The economic council will be able to draw substantially both in its forecasting and in its planning on the resources of various parts of the economy. It will undoubtedly second economists from various departments of government. It will, I should think, second for short periods of time economists and others from private industry, from universities, from labour and elsewhere. I hope it will. It will also engage through its membership and through the standing committees which it is authorized to set up, in close collaboration with the public as well as the private sectors of the economy. I think it is implied in this bill that there will be very close consultation indeed between the council and its staff on one hand and the private sector of the economy on the other, as there will be between the council on the one hand and the agencies of the federal and provincial governments on the other. Indeed, the reliability of the forecasting and the usefulness of the planning will depend very much on the confidence established between government, labour, industry, provincial economic councils and so on. Therefore, there must be co-operation at this level.
In approaching the second phase of its first function, the council will, then, through its own membership, through the expert staff it employs, through the economists and others it seconds, as well as through the consultation it carries on with the other sectors of the economy both in the private and the public sectors, be able to gather up and attempt to co-ordinate the sum total of the plans and decisions of private and public bodies.
Here, it seems to me, is another major difference between this bill and the bill which was presented last year. There was nothing in that bill to suggest any kind of collaboration with either the private sector of the
Economic Council of Canada economy, or the public sector, including the provincial governments. The latter is all the more surprising because of the interest the party which was then in power professed to take in federal-provincial relations. But it seems to me they were taking a view of these relations which is, basically the watertight compartment view enunciated many years ago by the judicial committee, a view which has now resulted in the theory of federalism that I call the collision theory, namely that the federal government and the provincial governments shall each go their own chosen ways until one comes in contact with the other, until there is collision. In some areas it may be possible to carry on in this way, but in many areas of policy, particularly in those of public investment, I think we must revise our thinking about this entirely. We can no longer take a narrow, juristic point of view about this. It seems to me that where one has the federal government, provincial governments and municipalities together controlling about 30 per cent of all investment, and where, of that amount, the provinces and the municipalities actually have more economic weight than the federal government, there must be at a very early stage, as provided by this bill, some degree of discussion, some comparison of plans and intentions, some attempt at co-ordination. This is, in some respects, almost a revolutionary concept. Nevertheless, it is one which is being adopted now by some extremely able people, particularly in the provinces. I am thinking of Quebec and Saskatchewan where I have heard this view frequently expressed, but it is current in others, too.
Therefore, an important element of this bill is the provision it makes in the last paragraph of clause 9 for consultation of this kind, to some extent in forecasting but particularly in drawing up plans indicating desired levels of investment and other matters. Similarly it is important to have collaboration of this kind with the private sector of the economy and, again, the bill makes provision for this to be done. Taking the field of investment again, the remaining 70 per cent of investment in this country, as is well known, is largely in the hands of three or four dozen large corporations. These, in recent years, have, in a way, been far more progressive than the government in realizing that there must be much more involvement with the public sector than was the case in the past, more need for planning. Therefore there is this important provision that the council study and discuss with the various elements in the private sector what specific plans for production and investment in major industries in Canada will best contribute to a high and consistent rate of economic growth. The
2208	HOUSE OF
Economic Council of Canada economic council will not be a body of pure researchers totally removed from everyday life, and it seems to me it is important to point this out. The other members of the council, the people who are drawn from various representative organizations, will, of course, keep in touch with broad movements, attitudes and ideas in Canadian society. As I say, the staff of the council itself will be composed not only of a body of permanent people but will be drawn from various parts of both the public and private sectors; and I should think that the council will engage in fairly continuous consultation with the major elements that have the main weight in our economic life.
As a result of this research and consultation the council, as I have suggested, draws up an economic plan or plans. The fact that it should draw up a plan at all, the fact that it should say, after its investigation to see what the growth potentialities of the economy are, here is a target rate of growth or a feasible rate of growth and we will now work out in detail by economic sectors and regions the amounts of investment that the achievement of this rate of growth requires, is a major departure. The fact that it does this also makes the present bill different from that of last session. On the basis of its economic analysis and forecasts, its consultation, its attempt to try to get together all the help it can, the council will inevitably spell out the implications, in investment and in other fields, for individual industries, especially the major industries, and I should think also the implications for the various public sectors of the economy.
I have been using the illustration of investment but one can use others equally well. The bill envisages, as I say, close collaboration between the public and private sectors of the economy both in economic forecasting and in drawing up the kind of economic plan that will or might make the target rate of growth attainable. The council in itself, according to the bill, does not have the power actually to implement its plan or plans. It cannot say to industry: All right, we have examined the investment picture with you and you are to conform with our investment program, with what we think is the ideal amount of investment for you to be engaging in over such and such a period of time. It does not have any coercive power. Indeed, I know very few planning agencies in the democratic world which have coercive power. It is really almost a red herring to suggest that they do.
What power does the council have? First of all, it has the power of publicizing its views, of publicizing its plan. Here we come to another difference between this bill and


the one last year, in that the council will not only initiate studies, which is extremely important in itself, but will publish an annual review of economic prospects and problems which will undoubtedly improve public understanding and certainly will raise the level of public discussion. I think there might be even further areas of publication possible for this council.
I agree with the leader of the Social Credit party who argued on Thursday the importance of publishing as much as possible. I have already pointed out one great improvement over last year's bill in this connection and there may be others. Certainly from the standpoint of educational value, for persuading businessmen to take a longer term view of growth, for educating government at all levels, and the public, in the policies required to facilitate growth and educating them generally as to other objectives, there is perhaps nothing so important as publication.
The council will also have the power of recommendation, and we come to its second major duty or function. It will have the power to recommend policies to the federal government that will contribute to bringing our economic prospects more closely in line with our potentialities of growth, to recommend policies that will in effect implement the plan that has been drawn up. There is no reason that some of these recommendations, where they fall in areas outside the jurisdiction of the federal government, cannot be made available to private industry, the provincial sector, municipalities and so on. In some cases I should think this would be possible, and certainly it is desirable.
In other words, this is the very opposite of planning for planning's sake, which was one of the arguments the official opposition put forward the other day. You would have planning for planning's sake if you did not do anything, if you simply had a bunch of people sitting around drawing up lovely plans, and that was that. What you have here is the hope that the plan may be implemented. There is no coercive power. There is a persuasive power. If the membership of the council is drawn from highly qualified people there is no doubt it will have quite a strong persuasive power. And it does have the power -I agree this was also in the Conservative bill of last year but it was so hidden I had a difficult time finding it-to make recommendations for the kind of government policies that will best implement the plan. These may be recommendations that involve a kind of intervention that we do not now have. They may be recommendations that involve only the implementation of the kinds of

policies we have had in the past, fiscal, tariff, tax, monetary and other policies.
The bill in itself naturally does not say what kind of policies might be recommended. For all one knows, the policies recommended might actually involve less intervention in toto by government rather than more. I was reading a book the other day which many hon. members have read recently, "Beyond the Welfare State" by Gunnar Myrdal. By the way, I hope it is still not too un-Canadian to read books, as it apparently is to write them. If I may digress for a moment, may I say I was shocked by the remark of the Leader of the Opposition (Mr. Diefenbaker) last Thursday that "the last thing a person going into politics should do is write a book". I must confess that as I listened to that remark it seemed to me it would exclude from politics, Winston Churchill, Harold Wilson, President Kennedy, Prime Minister Nehru, President Radhakrishnan, President de Gaulle. Indeed, as I ran down the list I realized it would exclude everybody but the right hon. gentleman. Actually I mean this quite seriously. I am shocked at a statement like that. It may be, of course, that he was scourging the party to which I belong because some of its members have written books. Perhaps he did not intend the statement the way it came across, but what came across so strongly to me, and I am sure to other members of the house, was that he meant what be said-that the last thing one should do if one is going into politics is to write a book.


John Whitney Pickersgill: Or even read one.


Pauline Jewett: Just do not let the halls of parliament become halls of learning; perish the thought. I do hope that there were no young people in the galleries to hear this kind of advice. In any event, as I say, I hope it is not contrary to the Canadian way of life either to write books or to read books.
After this small digression I should like to return to the book "Beyond the Welfare State", by Gunnar Myrdal who says that planning is probably the only alternative to the chaos created by unco-ordinated and disorganized state intervention, the very kind of unco-ordinated, disorganized, ad hoc intervention we have known in this country for too long, and especially during the last few years. Rather than being the bureaucratic confusion which the Leader of the Opposition described, it could well result in the very opposite, the more rational use of the power of the state which I am sure is something we all really want in the long run.
Finally, whether the government will adopt policies that are recommended, whether it
Economic Council of Canada will try to implement, so far as it has jurisdiction to do so, the plans that are drawn up, will depend of course entirely upon the government. Whether it will use the old tools or whether it will fashion new tools, will also depend a great deal on the government of the day, upon the conditions of the day, upon the attitudes and state of mind of the Canadian public. I would think it quite possible, after this council has been in existence for a while, that the Canadian public will become much more aware and knowledgeable of the Canadian economy, its problems and prospects. We might then become much more willing to use what I call a rational use of the state in areas where we can aid and increase employment, make for a better rate of economic growth and provide a better life for Canadians.
What is clear is that whatever action the government takes, it will undoubtedly be positive action. It may hurt some sectors of the economy. Whatever action the government takes will be on the basis, first, of more fundamental research than heretofore and, secondly, on a more integrated approach. It will function on the basis of a much greater degree of consultation with the public sector, federal, provincial and municipal, and with the private sector. Third, whatever action the government takes will be on the basis of a plan or a model. The philosophy underlining this government's approach is, I think, undoubtedly that of Robert Marjolin who said in the European economic commission's report put out in Brussels in 1962:
Doubtless it is possible to make good policy without planning if the needs are so evident that there could be no doubt as to what action to take. Where they are not so evident a great deal of information and thought may be needed. In the present circumstances of very considerable uncertainty, of rapidly changing conditions, planning can help to make a rational economic policy possible.


Hon. Paul Mariineau (Poniiac-Temiscamin-gue):: Mr. Speaker, in so far as the last speaker is concerned, I wish to state how pleasant it was to listen to her. If the new board that is being envisaged by this measure has few persuasive powers, I am sure the hon. lady has many persuasive powers. I should like her to use them to try to persuade her government to do the things that will accomplish some of the objectives she has mentioned, instead of simply talking about them and further confusing an already confused situation as a result of events which have taken place since April 21 last. (Translation):
Mr. Speaker, this evening I should like to focus my remarks on the President of the Privy Council (Mr. Lamontagne) to whom I
listened with great interest and respect the
2210	HOUSE OF
Economic Council of Canada other evening. He talked with that certain confidence-that I could describe as doctrinal-for which he is known in his pronun-tiamento ex cathedra to which he has become accustomed for some time now. He also indulged in most interesting economic prophecies, theoretically of course, and I congratulate him for that.
He took the liberty of scrutinizing the mysteries of economic cycles and I would readily recognize that no one is as qualified as he is to do so. And in the course of his scrutiny he happened to make some discoveries. He stated that among other things our Canadian economy was suffering from a stagnant condition, I even believe that he used the phrase "chronic anemia".
Furthermore, I found that, in 1954, when he was writing his book on Canadian federalism, which has been abundantly commented on in this house during this debate and preceding ones, he made precisely the same remarks we have just heard, as shown on page 136 of his book, which contains some statements about the economic stagnation found in several parts of the world, particularly in Canada. In fact, he stated-and he was perfectly right to do so:
The nightmare of economic depressions, during which production falls sharply, has surely not vanished yet. Finally, practically nothing has been done to put a stop to seasonal declines in production. Far from having been overcome, those difficulties are still the greatest economic problems we will have to tackle.
A little further he said:
That is why the government policy must aim first at assuring a balanced expansion or, more exactly, a national revenue and an employment level that will be stable and high.
He was right in saying that and I congratulate him for doing so at that time, by taking an entirely non-partisan stand. However, in his remarks last Thursday, the President of the Privy Council seemed to believe that that economic anemia had developed during these last few years, although in 1954, when his party was at the peak of its political history, we were faced with the same problem.
Dealing with the causes of that chronic stagnation the minister said, as stated on page 2086 of Hansard for July 11, 1963:
-our private sector has almost exhausted the investment potentialities which technology created in Canada at the beginning of this century.
Obviously, the minister who is an expert in economic matters, had no intention of allowing us into the inner circle of those policies. He told the members that he was
[Mr. Martineau.l

sparing them the details and in doing so he took, in a way, a take-it-or-leave-it attitude.
Indeed, I did not expect that he would waste that valuable science in dispensing it to laymen or to run-of-the-mill members of parliament.
In concluding, the minister said that the private sector left to itself cannot overcome those difficulties. Speaking of economic stagnation he said that we need a bolder and more dynamic government leadership, in other words a plan so that the various aspects of the economic policy will be well co-ordinated and so that the private sector can work hand in hand with the government.
He is against imperative planning for Canada because in his opinion, it would be politically unacceptable, economically undesirable and constitutionally unworkable. I entirely agree with the minister in that respect. But when he speaks about things that are politically unacceptable, economically undesirable, and constitutionally unworkable, has he stopped to think that it is precisely those things that the government to which he belongs has been offering us for the past few weeks?
As far as politically unacceptable things are concerned, could you find anything more so-and I merely point this out as an example-than some of the taxes applied by the Minister of Finance (Mr. Gordon) in his recent budget? As a matter of fact, those taxes were economically disastrous and politically unacceptable to such an extent that the minister had to beat a retreat. I am convinced, besides, that if it had been possible to save face at the same time, his retreat would have been complete.
Let us now deal with those things that are constitutionally unworkable.
In the first place, let us consider the statements made by the Minister of Finance in his budget speech on the priority requirements of central authorities in fiscal matters. Let us consider the municipal development and loan bill. Let us consider the establishment of the department of industry. Let us consider some of the statements made by his colleagues in this house indicating that the government is prompted by a spirit of centralization such as has never been witnessed before in the history of Canadian confederation.
He mentioned later that the planning advocated by the government and which it intends to establish in Canada is essentially a form of planning which shows the way and provides incentives-in other words that it is an indicative planning similar to the French pattern.

Near the end of his speech, he said that the bill provides for the establishment of an economic council with very extensive powers which would give planning a scope that would be comprehensive as well as flexible. Then he added that the legislation was of primary importance.
In short, he is only restating the theories put forward in his book "Canadian federalism" which, in order to be implemented, would require a new centralizing offensive.
Besides, the minister had expressed his inner convictions on that connection in his book, which is entirely imbued, if I am not mistaken, with centralizing motives and where that idea is found, among other things, on page 282. I shall quote a few sentences:
Finally, a program of economic stability requiring a central direction and a well-integrated economic policy. All those factors indicate that the federal government will have to play a major role-
Those are the important words-
-a major role in the collective fight against instability. The insistence put on the finer aspects of country life-
-says the minister-
-has not solved the problems created by migration towards the cities.
That is a good example but it could be slightly changed to read as follows: The insistence put on the advantages of provincial autonomy will not solve the economic problems of Canada.
Mr. Speaker, the minister seems to think that I have great imagination but I must say that my statement is truly in the spirit of his remarks.
The minister wishes this country to adopt methods of planning which surely would not be workable within our federative framework.
On the other hand, we must ask ourselves if the object of the bill we are studying, and which aims at the creation of a Canadian economic council, is truly the establishment of economic planning in this country. The minister himself has said that such was the object of the bill.
Again, are we sure that the planning spoken about by the government is, in fact, what is called directive and indicative planning, similar to the indicative planning we find in France?
Mr. Speaker, there is not the slightest adumbration of planning in this bill. Let us take a good look at it.
One only has to read certain provisions of this bill to find many harmless words like 28902-5-141
Economic Council of Canada study, examine, analyse, compare and recommend.
Indeed, Mr. Speaker, it would seem that we are among a group of normal school students. This is mere window dressing. Even though we consider all the scope, all the powers of the bill, this does not even constitute a starting point to the establishment of a planned system in Canada.
The minister may say: Well, those are partly the terms used to introduce the bill in the house last year. It is true, it has been largely copied, but at least, when the government of the time proposed the bill last year, they did not endeavour to tell us that, by that measure, they were creating some sort of planning in Canada. They merely said that the purpose of the project was to give our economy a sense of direction and to the government the benefit of experts in such matters who were available in Canada.
Consider section 9, Mr. Speaker, which is as follows:
It shall be the duty of the council to advise and recommend to the minister-
To advise and recommend, those are the general duties of the council. To advise and recommend. Then the bill leaves the general for the particular and says that the council will have the responsibility "regularly to assess"-what does that mean? And we also read that the council's duties will be:
To recommend government policies-
To consider means-
To study means of increasing Canadian participation in ownership, to study implications, to study and discuss with representatives of the industries concerned and with representatives of labour, farmers,-
Cliches, nothing but cliches.
To study how national economic policies can best foster the balanced economic development of all areas of Canada.
To explore and evaluate particular projects of major significance for the expansion of industrial activities-
To encourage maximum consultation and cooperation between labour and management-
To seek full and regular consultation with appropriate agencies of the governments of the several provinces.
To encourage, promote, organize and so forth.
Well, Mr. Speaker, I challenge the minister to prove how, with all those recommendations, with all those studies, all those analyses and all those comparisons, we will get this capital project he talks about, as well as a planned economy in Canada.

Economic Council of Canada
Mr. Speaker, if we look at French planning, we realize that it is a very different story. First, in French planning, practice came before theory. Here it is the theoretical planning of the minister which comes first. We find loud theories which help cover the lack of substance. If Montaigne were here, he would certainly wonder where is in all that the substantial marrow. Where is the substance towards which all energies will concentrate to establish planning, a guiding policy?


Mr, Lamonlagne:: You say that your bill was copied.


Paul Raymond Martineau: There is nothing in all that, as I said earlier. A while ago, I was telling the minister that we had not tried to put in that project something which was not to be found in it. But here, Mr. Speaker, it is just the opposite. Here we really have the mountain that brings forth a mouse and nothing else.
In France, planning constitutes a collective work aimed at a co-ordinated economy and, to use the words of the French lecturer Pierre Masse, it is not a concert of chamber music but a symphony requiring several thousand performers.
The French planning commission is made up of some 150 experts, but with its 25 renovation boards and 20 economic and social operational groups, there are about 3,500 people.
But in this case, Mr. Speaker, I put it to you that this project will give us no plan nor even a commission. And the minister rises at his place in the house and tells us most emphatically that we have before us a major contribution, the beginning of planning.
No, these are empty words, pompous remarks, because if we go beyond the surface, looking for the contents of this bill, we find absolutely nothing. We are misleading the Canadian people if we imply that we have in it indicative planning along the line of the French pattern.
Mr. Speaker, if we consider the French plan, we see that it bears on energy producing industries, such as coal, electrical power, steel, and transportation. The emphasis is put on a reduction of prices and an organization of markets, scientific and technical development together with a specialization of enterprise.
Now, Mr. Speaker, those things can be accomplished in a country like France which

has a unified government, but I submit that they cannot be accomplished under our federal system, particularly without prior consultation with the provinces. The minister was very careful not to mention that he had had any consultation with the provincial governments in that regard before submitting this legislation with such a fanfare.
Moreover, Mr. Speaker, the French plan is a logical one with a Cartesian outlook. It tends to economic integration in transferring to the national level the techniques of business agreements of private law.
Here again we are in a field strictly reserved to the provinces, the field of civil law, private law. That is why planning such as the minister wants to force upon us, is not at all feasible under the present system.
Mr. Speaker, this same French plan has a great number of modernization boards, vertical and horizontal boards, and so on. The formulation of the plan implies a strong centralization and very extensive powers for the federal government.
I know that such a centralization of powers is quite acceptable in the opinion of the minister, but it is not acceptable to a great number of members of the house and especially to the provinces.
Mr. Speaker, in the preparation of the French plan, a great many commissions set up first preliminary drafts respecting production, employment, investments and decide upon a desirable rate of growth. Then, those drafts are submitted to the government which selects a desirable rate of growth.
The government itself consults the investment section as well as the economic and social council.
Now, those organizations do not exist under our system and their establishment is not foreseen in this project or in any other legislative program now before us.
The government having made its choice, the modernization boards prepare a first preliminary synthesis and then a meeting is held between experts and members of the planning board who, after discussion and settlement of contentious points, agree to prepare a final synthesis with regard to the implementation of the plan. That plan is submitted to the government, discussed in the chamber of deputies and then approved by the president of the council. Afterward, that plan becomes the official plan for the next four or five years in France.

It should be noted in all this that the French government holds greater implementation powers than the Canadian government; besides the minister said that it was much better that way, under our system.
Besides, in France, the government sets up its budget policy according to the development program thus drafted. Here we did not do that in this case. The last budget did not have any planning implications, Mr. Speaker; it was rather the opposite.
The government sets up its credit and fiscal policies according to the objectives of the plan. Besides, in France, the government has a direct control over almost half the investments. Here in Canada, I think it is 15 per cent. So we realize that the two systems have nothing in common.
Also, in France, the government may resort to incentives, such as fiscal incentives, the granting of credit priorities and the advantages given companies which meet the objectives of the plan.
If all that is not direct coercion, it is at least an indirect form of coercion. I have noticed no indication yet that the government would be prepared to impose that form of coercion and give the country these means of implementing a real program of indicative planning.
There is absolutely no adumbration of planning in this bill or in the others submitted to the house. On the contrary, I believe that the legislation that has been introduced constitutes a confused heap of divergent interests who were anxious to be heard.
In a pretence of action, the government decided to take some measures without asking itself whether those measures were meeting actual needs of the country.
I am convinced that the measures proposed by the government are not likely to put an end to this stagnation, this chronic anemia, which the minister mentioned last Thursday. Quite clearly, Mr. Speaker, this bill does not make for economic planning in this country. If the minister is sincere-and I believe he does genuinely wish to improve economic, cultural and social conditions in Canada- I suggest that he advise his colleagues, and more particularly the Prime Minister, to call immediately, to start with, a dominion-provincial conference, and not only a conference such as the Prime Minister announced today, regarding municipalities and the contributory 28902-5-141J
Economic Council of Canada pension scheme, but a dominion-provincial conference to deal specifically and exclusively with economic problems.
Then, too, let the government set up permanent federal-provincial co-operative agencies, possibly a secretariat to deal with economic matters.
I think it is of first importance that the plans prepared by the government be thus established in the light of historical circumstances and constitutional needs. Let us define correctly the economic duties at both levels of government so that there will be no duplication of efforts and especially no conflicts of interests and jurisdiction.
Since this government has been in power conflicts have grown in numbers; new conflicts of authority have risen incessantly to such an extent that-and I do not think I am wrong in saying this-never have dominion-provincial relations been in such a pitiful state as they are since this government came to power. And, for pity's sake, let us forget about the concept of the leading position of the federal state.
In his book, in which he refers to the so-called advantageous position of the federal government, the minister states repeatedly that the provinces do not have the proper financial means and taxation power to implement those plans. Only if the balance is restored between the central government and the province in the field of taxation, in accordance with the provisions of the constitution, will provincial governments be able to play their true role.
Thus we would create the proper climate to stimulate the economy of the country instead of making relations worse.
In addition, the proposed consultations should be more than the reflex of politicians who find themselves in the wrong. When we were considering the bill for the establishment of a department of industry, the Minister of Defence Production (Mr. Drury) stated that neither he nor the government had to consult the provinces in that connection. According to him, the members of the government are fully aware of the dividing line between federal and provincial jurisdiction and there is no call for a federal-provincial conference in that respect.
Well, Mr. Speaker, I submit that it is precisely this arrogant attitude, this way of deciding by oneself what others must do that has given rise to ill feeling. I challenge the minister and his colleagues to deny that the climate has taken a sharp turn for the worse

Economic Council of Canada in the past tew weeks. It is obvious and the facts are there to prove it.
Mr. Speaker, if we were to proceed in the manner I have just outlined I believe we could set up an intelligent and co-ordinated economic policy which would involve the kind of planning we need today-as no one will deny-and which would truly meet the needs of all our people.


Mr. Jean Chretien (Si. Maurice-Lafleche):: Mr. Speaker, we have listened with great interest to the hon. member for Pontiac-Temiscamingue (Mr. Martineau) who obviously tried to find some meat in the statements of the Liberal party. However, if the hon. member for Pontiac-Temiscamingue finds that federal-provincial relations are now somewhat down to earth, there is an explanation to this: the government which I support is an active government. We take measures and we draft a policy which is of course facing some opposition. But unlike the previous government, we, on this side of the house, are doing things.
The problems between the federal government and the provinces will be solved by negotiations. The present Prime Minister took steps to solve those problems. We, as members of the federal government, have no right to stay inactive on that account. We have to take action and we do take action, something that our friends, the Conservatives, failed to do in previous years.
The hon. member for Pontiac-Temiscamingue is concerned about the meaning of the bill before us, but if he would analyse its provisions, he would realize that we also want planning, a kind of planning that entails action. The economic council will be an economic planning council that will succeed. We will have the necessary staff provided by this piece of legislation that will give the federal government the possibility of providing for the future; something which has never been envisaged by our friends opposite and the lack of which has put the country in its present position.
Mr. Speaker, my hon. friend is concerned about the fact that the government has perhaps called in experts to discuss the matter with the President of the Privy Council (Mr. Lamontagne). Let him be assured that I am not an expert, only a backbencher, but that I have faith in the planning policy of the party which I support.

I think that Bill C-72 which provides for the establishment of an economic council of Canada is very important and I hope that all hon. members of the house will give it the importance it deserves. Administration in Canada is so much more difficult because the country is a kind of a geographic nonsense in a political unit. The fact that citizens of Victoria in British Columbia, of Halifax in Nova Scotia and of St. John's in Newfoundland are all grouped under the same legislative authority, while there is a whole continent between them and that on this vast territory the density of population is relatively small, that is the reason why our country attained the various stages of economic growth later than our most immediate friends, Great Britain, France and the United States.
According to Professor W. W. Rostow of the Massachusetts Institute of Technology in his book entitled The Stages of Economic Growth, Canada attained in 1950 the same degree of economic maturity, as regards technology, close to 50 years after the above-mentioned countries. Why? Because Canada just about came out of the preparation period to enter the technological development period which could bring our country to an economic maturity. In fact, to date, we have used our energies for the development of our natural resources in this raw state and the setting up of basic public services such as railways and great road projects. In other words, it is only in the last few years that our country has been in a position to carry out the development of an economy more diversified and more able to meet the needs of a labour force more and more specialized and numerous.
In that context, I think the development of our economy is in a very critical situation today and I sincerely think that we must go ahead with economic planning in our country.
The present situation calls for an immediate positive action to make known to the nation the precise objectives which our economy must reach.
We must without delay direct the development of our economy according to our possibilities, our natural resources, our increasing manpower and our international markets. Finally, every person will have to do his utmost to achieve the aims determined by the economic council and devote all his energies to that end.

However, the country will not achieve those aims without an appropriate intervention from the state. The federal government will have to legislate in the fields coming under its jurisdiction and devolved to it by the constitution, such as credit, taxation, tariffs, in a co-ordinate and positive way, so that the aims sought might be achieved in the shortest possible time and that the public and private enterprises are not left alone to seek those aims. All those potential supplies of natural wealth available to Canada must be developed in a rational way, so that the Canadian people may derive the greatest possible profit to which they are entitled. But in order to achieve this, our government must adopt positive and effective policies, even though private enterprise must be ready to make certain sacrifices.
Allow me, Mr. Speaker, to refer to the province of Quebec as an example. During the past few years, it has launched economic development projects and has completely nationalized its water resources to achieve one of its economic purposes. It is now getting ready, through a joint public and private body, the "Societe generale de Financement", to develop a large steel complex. I think that it is an example that we should take into consideration and try to follow, if necessary.
I am definitely in favour of indicative but not of imperative planning. But the necessary means should be made available to us in order that the purposes which will be put forward by the future economic council be achieved without delay even if they are detrimental to a few.
In fact, nobody likes going to the dentist to have a tooth taken out but it is a temporary pain for a future good.
I want to point out two particular points of Bill C-72. The first one concerns the appointment of three permanent directors for a seven year term. In my opinion, the appointments of those three directors will have to be considered very seriously and carefully. I think the council formed of those three permanent directors will be in a position, under the provisions of this bill, to carry out very serious and thorough studies on the Canadian economy. And this work will have to be done speedily and result without delay in precise aims for the country.
Consequently, I feel we must give a much greater importance to this triumvirate than to the 25 non-permanent members of the council. This 25 member council may inform the permanent council of the people's views,
Economic Council of Canada and the latter will immediately have to set about supplying us with the necessary plan to lead our economy where we want it to go.
At this stage, I would like to say that I found very interesting the suggestions of the hon. member for Port Arthur (Mr. Fisher), who, incidentally, approves the principle of this legislation and would like those three permanent directors to be appointed for the government's lifetime, that is not for a set period of seven, eight, nine or ten years, but for the duration of the government. He states that this course is followed in the United States, with interesting results. I partly share that opinion, but I am surprised that it should be suggested by the hon. member who put a series of questions on the order paper for the purpose of establishing the efficiency of the ministers' executive assistants who are always appointed for the duration of a government because, to my mind, the attitude of the hon. member is inconsistent, when he wants officials to be appointed-
(Text):


Douglas Mason Fisher: I should like to ask the hon. member what is the contradiction. I fail to see it.
(Translation):


Joseph Jacques Jean Chrétien: Mr. Speaker, I simply point out those two facts which are, to my mind, contradictory. I think that executive assistants, who have their ministers' trust, should be appointed at the same time as the ministers, whereas the hon. member for Port Arthur wants the directors of the economic council, which will certainly be one of the most important government agencies, to be appointed for the government's duration.
(Text):


Douglas Mason Fisher: I wonder if I might ask the hon. member another question. Is he not aware that a number of times, both in this parliament and in the previous parliament, I have advocated that ministers should hire able people. The reasons these questions were on the order paper was to discover whether these were able or not.
(Translation):


Joseph Jacques Jean Chrétien: I notice in this new legislation an improvement over the one submitted by the former administration, in that it directs the council to:
-prepare and cause to be published a review of medium and long term economic prospects and problems.
as mentioned in subsection 2 of clause 21.
I believe this is a most important step toward the information of public opinion and the attainment of the objectives of our plan-

Economic Council of Canada ning. Such planning must be for the entire nation, not only to enable the government to obtain some information.
Obviously, the planning scheme we are adopting will not compel anybody to do anything, but I believe that public opinion, if it is well informed by the economic council, will be able to force both governments and private enterprise into taking the necessary steps to attain such objectives.
To conclude, I believe it is most urgent that we adopt this bill in order that the council may be appointed in the nearest possible future. I am happy to see that the provisions of this bill give ample freedom to the council. This council will have to conduct its research in such a way that the nation will have before it precise and practical objectives. And the publicity it can give its studies and reports under subsection 2 of clause 21 will have to be informative for the population as a whole, in order that the private and public sectors of our economy may work in co-operation to attain those objectives.
In a word, this economic council should not be content to be a propaganda machine for the government, as was so often the case for similar bodies in the past, but it should be a living impartial and courageous body which, through its qualification and work, will inspire confidence to the nation and thus will be able to play the part we have a right to expect from it, namely draw up a master plan for our economy to ensure the well-being of the Canadian people.


Louis-Joseph Pigeon: Mr. Speaker, will the hon. member entertain a question?


Joseph Jacques Jean Chrétien: Certainly, Mr. Speaker.


Louis-Joseph Pigeon: In order to increase the
effectiveness of this legislation, since it requires co-operation from the provinces and the municipalities, would it not be logical before we consider this bill to submit it to the federal-provincial conference that the Prime Minister said was to be called for the end of the month, in order to ensure this new agency a 100 per cent effectiveness?


Joseph Jacques Jean Chrétien: Mr. Speaker, I should like to say that the federal government must be able to propose legislation and that it is normal for us to discuss it here first. If difficulties arise, of the kind that my hon.

friend sees everywhere, then the matter could be discussed with the provinces concerned.
(Text):


Walter Gilbert Dinsdale: 
Maurice John Moreau: Will the hon. member permit a question?


Walter Gilbert Dinsdale: Yes.


Maurice John Moreau: Will the hon. member tell us whether he believes his own propaganda?


Walter Gilbert Dinsdale: Mr. Speaker, I assure you this is not my propaganda. I am going to quote from a commercial letter published regularly by the Canadian Imperial Bank of Commerce. The article is entitled, "The Canadian Economy In 1963". I assure you, Mr. Speaker, that I have no direct connection whatsoever with the editor of this commercial letter and that he forms his conclusions entirely independent of any prompting from myself. Under "The Record in 1962" I read the following:
The Canadian economy experienced a good year in 1962-
If I may interpolate; this was a year of stagnation and inactivity according to spokesmen for the Liberal party. As you will recall, Mr. Speaker, we had an election in that year and the Liberal propagandists went about the country saying that we were facing bankruptcy and that the economy was in a confused and hopeless state. I wanted to make that interjection at this point to put the matter in perspective with the summation in this commercial letter.
The Canadian economy experienced a good year in 1962, measured in terms of output. Gross national product increased 8 per cent in value and 6 per cent in physical volume, and real output per person rose significantly for the first time since 1956.


Some hon. Members:: Hear, hear.


Walter Gilbert Dinsdale: I do not know why that phrase should cause so much jubilation on the part of hon. members opposite because I was a member of the house in 1956 and I recall that the economy of that period-


Mr. Lamoniagne:: It was 8.5 per cent.


Walter Gilbert Dinsdale: -had reached a stage of stagnation to such an extent that the government of the day appointed a royal commission, which became known as the Gordon commission, in order to chart a new course and provide a new compass for a government which had lost its spirit of creativity and its inspiration. I further remember that back in 1953 and 1954 we passed through a rather difficult period, in economic terms. There was a slight recovery in 1955 and 1956 but it was obvious that the economy had reached that state because we had failed to adjust to the dynamic changes that followed world war II. I resume quoting:
Economic Council of Canada
Most of the Increase in volume of production occurred in the first half of the year and price increases were stronger in the latter part of the year due in part to the depreciation of the Canadian dollar. The rise in activity was well diifused in terms of geographic location-
This is the significant part of the comment.
-and variety of employment, and a very good wheat crop provided additional strength in the fall of the year. The major stimulus in 1962 came from two sources, a very substantial rise in merchandise exports for the second year in a row and a large increase in purchases of goods and services by the provincial and municipal governments.
Now, there is an objective appraisal of the state of the economy as it was left by the outgoing Conservative administration. I think it will be readily seen, Mr. Speaker, that it hardly conforms to the description that is forthcoming from spokesmen for the government during the course of the current debate or during the course of the debate that took place last January on the bill to establish the economic development board, which was sponsored by the former administration.
I think it would be instructive if we were to recall some of the observations that were made at that time. I refer to my very honourable friend, the hon. member for Leeds (Mr. Matheson), who made an ardent contribution to the debate in which he quoted extensively from the newspapers of the day which seemed to agree with some of the statements that were made by hon. members opposite at that time. The Toronto Telegram for example, on January 7, 1963, contained an article with the heading "Economic Dipping". I quote in part from it:
Our barometer records a drop taking place as we enter 1963. The recent gyrations of many indicators-*
I do not know to what gyrations they were referring in this article, or what indicators, whether it was political gyrations or what they were. I continue quoting:
-made many think that the slowdown predicted earlier for the end of 1962 had been called off. It has not. The good that was in 1962 came to a close with the year. We have now started on a downward swing.
I am sure the hon. member for Leeds would not agree today with that quotation which he used last January during the debate at that time. Then, he quoted also from Mr. Dalton Robertson, writing in the Financial Post of January 12, 1963, who said:
By an easy majority, the sensitive indicators of how the Canadian economy is doing suggests that the 1961-62 expansion is over and the recession is now on.
There is an even more revealing contribution by the present Minister of Finance (Mr. Gordon) as recorded at page 2145 of Hansard for November 29, 1962. I quote:

Economic Council of Canada
As I have said, the government has shown itself unable to make decisions or to manage anything.
I could pause here and cite the phrase, "physician, heal thyself".
In these circumstances I doubt if the government will be able to make any more use of an economic development board than it seems to be able to make use of other parts of the existing government service and machinery.
Well, since that time the hon. member has assumed ministerial responsibility. It is interesting to compare the deeds of the past few weeks with the words that were so boldly uttered in the house a few short months ago, and particularly the reference to the inability of the former government to use the existing machinery of the government service.
Then, we go to another comment from the same gentleman to the effect that the advisory committee that was recommended in the bill would result in the circumvention of the civil service. These are all very interesting comments in the light of what has happened in recent weeks. They indicate, Mr. Speaker, that it is much easier to make speeches in this house than it is to translate those speeches into positive action on behalf of the people of Canada.
The Secretary of State for External Affairs (Mr. Martin), speaking in the same debate on January 22, referred to the former bill which had the same purpose as this bill before us, as being a mere gesture, a fagade. There was one positive contribution and that was by the hon. member for Coast-Capilano (Mr. Davis). I feel he put his finger on the essence of the problem that confronts this parliament and the country as a whole, as we move towards the implementation of legislation to set up the economic council. There has been a change in terminology. Ours was described as the economic board, and theirs is described as the economic council.
The hon. member for Coast-Capilano said that such legislation would have to provide for the co-ordination of governmental departments in order to avoid duplication. I agree heartily with the hon. member in that regard. Second, he suggested that the board, as it was, or the council as it will be, will have to provide for co-operation between management and labour. I should like to suggest, as I proceed to discuss the bill we have before us, that in some respects the type of organization contemplated by the government will frustrate those two important functions that were laid down by the hon. member for Coast-Capilano. I believe that the productivity council, which is going to be replaced by the implementation of the legislation, was a much more useful body in carrying out the functions of co-operation be-

tween the various sectors of the economy than is the council that we are discussing tonight. I think that, in some respects, it is unfortunate that the plan of the previous government was not implemented, because it was a logical plan.
It was a plan that had begun, in the first instance, with a program of action, a program of action that had to be implemented hurriedly in 1957, a program of national development. Then, after the program was under way, it became necessary to deal with the anomalies in government organization which existed because of the failure of the government and this parliament to come to grips with the tremendous changes in the Canadian post-war enconomy, and indeed in the world economy. Gradually we revamped the machinery of government. We brought in new machinery to take care of the new functions that were required to bring the Canadian economy into line with the demands of the mid-twentieth century. The productivity council was a most important contribution in this respect. The basic function of the productivity council was to provide a sounding board wherein the representatives of the various sections of the Canadian economy could come together in order to acquire an appreciation of their respective points of view, instead of endeavouring to carry on in a state of armed truce.
Certainly there was planning needed in Canada, and this has been demonstrated in recent weeks by the unhappy mistakes made by the government because it neglected to take into consideration the existing machinery that is available in an advisory capacity, particularly in the Department of Finance. Instead a group of experts were brought in, ignoring the existing co-operative and coordinating machinery that is already available within the government service.


Maurice Lamontagne: What about the bill?


Walter Gilbert Dinsdale: The hon. minister asks what about the bill. I understand we are on second reading of the bill, and during the 12 years I have been in this house it has always been my understanding we could discuss-


Maurice Lamontagne: Not the budget.


Walter Gilbert Dinsdale: -the principles of the bill in broad terms, which gives an hon. member a considerable degree of latitude. I know the minister is new to the House of Commons, but I am sure he would agree that if we are going to deal with the very complex economic problems that exist in Canada today, we have to have the privileges provided by the rules of the house at this important stage of the consideration of the bill. We will get

down to discussing the details of the bill when we come to the committee stage.
The hon. member for Rosedale (Mr. Macdonald) applauds. He is another new member of the house and does not seem to appreciate that there are several stages to the bill. When we move to the committee stage, we are provided with an opportunity to discuss the terms of the bill in detail.


Donald Stovel Macdonald: On a point of order, Mr. Speaker, I have been a member of the house at least long enough to know that the hon. member for Brandon-Souris (Mr. Dinsdale) should talk in the relative area of the bill, and as yet he has not spoken anything about Bill C-72 which is before the house. We await with interest his remarks on the bill, after his irrelevant digressions.


Walter Gilbert Dinsdale: This is an expression of opinion on the part of the hon. member for Rosedale. As usual he thinks he is entirely right and I am entirely wrong. But this is the process of debate in this house. He is not too inexperienced, because last January we listened 10 days to a discussion of a bill which perhaps was not quite as relevant as the discussion that has taken place in the space of the last two days in discussing the bill before us.


John Whitney Pickersgill: I wonder if the hon. gentleman would permit me to ask him a question?


Walter Gilbert Dinsdale: Certainly.


John Whitney Pickersgill: Does the hon. gentleman think it is essential to his honour to take as long as he accuses us of having taken before Christmas?


Walter Gilbert Dinsdale: I must say that I might have-


Maurice Lamontagne: You might.


Walter Gilbert Dinsdale: -I might have come under the influence of the bad example set by the leader of the house-


John Whitney Pickersgill: I did not speak on your bill at all.


Walter Gilbert Dinsdale: -when he was in opposition. I had been in opposition for six years-


John Whitney Pickersgill: So have I.


Walter Gilbert Dinsdale: -prior to the change of government in 1957, and I belonged to an opposition that could rightly consider itself Her Majesty's loyal opposition-


Some hon. Members:: Hear, hear.


Walter Gilbert Dinsdale: -because we always considered any legislative measures that were presented to the house from the standpoint
28902-5-142
Economic Council of Canada of the best interests of Canada, rather than mere partisan advantage. Now, during the past six years-


Maurice Lamontagne: Come back to the bill.


Walter Gilbert Dinsdale: -I saw an opposition that was not always responsible-


Mr. Deputy Speaker:: Order. I wonder whether the hon. member who has the floor will allow me to point out to him that he seems to be straying away from the original line of thought with which he commenced his speech. I would invite him to resume that original line of thought.


Walter Gilbert Dinsdale: Thank you, Mr. Speaker.


Mr. Cardiff:: I suggest, Mr. Speaker, it was the leader of the house who directed him into that line.


George Clyde Nowlan: It was the hon. member for Rosedale (Mr. Macdonald).


Walter Gilbert Dinsdale: The intrusions from the other side have not been too helpful in this respect, and I am afraid the house leader has led many a young member down the political garden path. I will return to the point I was making. The productivity council carried out the function of encouraging co-operation between the various sectors of the Canadian economy, covering labour, management, the farming community and the universities as well. All these areas have an important part to play in the Canadian way of life, and I hope that the same spirit of co-operation that was generated and was producing so much positive good will be carried on by the new council when it is established and is in operation.
I have been somewhat disturbed because of the tendency to neglect the importance of the agricultural community in these matters. There has not been too much discussion of agricultural matters in the house during the current session, and I would remind the government that agriculture is still one of our basic industries. In all the deliberations of the council it should be given a position of paramount importance.
As an indication that we have gone a long way in dealing with the problems the council is designed to deal, I merely mention a few of the existing agencies of government already established, the resource ministers' council, the national energy board and ARDA. These are important bodies that came into existence during that so-called period of inaction of the former administration.
Dealing with ARDA, I would like to refer to a statement made in this debate the other night by the hon. member for Port Arthur (Mr. Fisher), when he suggested that ARDA was an excellent example of the kind of

Economic Council of Canada centralized planning that is needed and is espoused by his party, the N.D.P. I suggest that ARDA is the very antithesis of centralized planning in that it places the initiative entirely at the local level. No program will be implemented unless it is first sponsored and brought forward by the local community group, where the real problems are known and understood, and then referred to the province, which in turn refers it to the federal authority. Here is an excellent example of the sort of co-operation and co-ordination that I feel sure this council is designed to bring about in Canada.
Then too we dealt with the regional problems, meeting the needs of the Atlantic provinces, and putting into effect the acreage payment program for the western farmers. Of course I do not need to refer-


Maurice Lamontagne: To the bill.


Walter Gilbert Dinsdale: -to the massive program that was sponsored in northern Canada by the former administration. This is only a part of the program that was carried out and that was necessary because of the long years of neglect and delay in coming to grips with the problems of government in the modern world. A transportation study was set up; tax policies are currently under review, and the famous Glassco commission, which has now finished its work, completely examined outdated and antiquated government organization and machinery that had been inherited by the former administration.
Banking procedures have been investigated, and a study made of our outmoded social welfare program which was in bad need of rationalization because it had originally been established on the basis of political expediency, rather than on the basis of meeting the real problems of social welfare in the modern state. All these things are under way. It seems to me the council that is proposed in this legislation is merely going to bring together many useful bodies of information which are already available to the government, and certainly it gives the lie to the propaganda that nothing has been done in recent years.
There is another point I would like to make, drawing my inspiration from the hon. member for Coast-Capilano. He referred to co-ordination within government. It seems to me this is going to be one of the major functions of the new department of industry. It is in the twilight area between the new department of industry and this new council that some confusion of function might exist. The new council could mean an overlapping of function and duplication of services unless we are extremely careful in sorting out the areas of responsibility as between the council and the


department of industry; or, to use the words of the Secretary of State for External Affairs, it could become a mere fagade to give the impression that something concrete and constructive is being done when, as I have tried to indicate in my outline, there is every evidence that giant strides have already been taken in this area. The co-ordination function within government is just as important as the co-operative function among other government levels and the private sector of the economy.
This brings me to the last point I would like to make, which has been made by other speakers; it was referred to by the hon. member for Northumberland (Miss Jewett) in her contribution to the debate this evening. I refer to the necessity for consultation with the provincial governments. Just as much progress has been made at the provincial government level as has been made by the federal government to meet the new demands of government in our complex twentieth century society. Indeed, many of the problems with which the council is designed to deal actually come under the jurisdiction of the provincial governments. This is an area where extreme care will have to be used if we are to realize the positive effects which can be achieved by a council of this kind. I am sure I do not have to admonish the government in this respect, because they have already felt the strength of the negative response that can occur in this delicate federal-provincial balance of power when the central government neglects to consult with the provincial governments concerning matters that are of extreme importance and concern to these governments.
During the resolution stage of the debate I referred to this point in passing, pointing out that the province of Manitoba, as an example of one province, is away ahead of Ottawa in dealing with the economic challenges of the new kind of economy in which we live. Most hon. members will have received recently this voluminous report from the government of Manitoba entitled "Manitoba 1962-1975", which indicates that here is a province that is away out ahead of the federal government. Manitoba has a Conservative government which drew its inspiration from the leadership provided by the former federal Conservative government. I trust that the minister responsible will be guided by the very excellent analysis of contemporary economic problems provided in this report. It covers every segment of the economy and I feel is an excellent reminder at this critical juncture in Canadian affairs that the provinces have their own important

sphere of influence, and any undue interference on the part of the national government is not going to be too helpful in continuing the high level of economic activity that was achieved by the former administration.
This is a federal state, and one must always remember that relationships among senior governments are delicate because of the very nature of confederation. Much of the Canadian economy belongs to the provinces. The resources belong to the provinces. The provinces, therefore, are not going to countenance any undue intrusion by Ottawa, particularly without prior consultation and certainly without concern for their sensitivities and prerogatives in this regard.
I should also like to suggest that the private sector, or the voluntary sector of the Canadian economy is most important in this respect. This report was prepared entirely by a committee of volunteers, none of whom received any stipend from the provincial government. I am afraid that sometimes governments of all stripes tend to feel they are responsible for everything that takes place in the economy. Of course, that is the authoritarian point of view, and in a democratic society one must always realize that in the final analysis it is the creativity of the people of the country, their spirit of co-operation, their initiative which will determine whether the economy continues to prosper.
In a council of this kind let us make the utmost use of the advice, services and initiative in the private sector of the economy. The private initiative is of basic importance. In the final analysis, Mr. Speaker, I trust that hon. members of the house, and particularly the members of the government, will agree that the best contribution a government can make in the field of economic development and economic health is to provide the atmosphere and climate in which the ordinary citizen, whether he be a businessman, a member of the labouring community, a farmer, or whatever his calling, can exert his maximum influence. It is the climate, the atmosphere, that matters.
I trust the climate that has been established-as has been pointed out so eloquently in this unbiased, objective report from the economists of the Canadian Imperial Bank of Commerce-will continue to thrive; that the example set by the previous administration will be duly noted by the new administration so they will forget their propaganda and deal with positive policies.


John Ross Matheson: Mr. Speaker, the last speaker spoke so well and graciously that he has tempted me to deal for a moment with the economic facts facing Canada at the 28902-5-142J
Economic Council of Canada moment. I do not want to refer to his speech in detail, but the biblical strictures used by the hon. member for Brandon-Souris (Mr. Dinsdale) were put to good effect. May I remind him that "The truth shall make you free", and that before we can go places in Canada one of the first requirements is that we must see starkly what is the situation at any given moment of time. I do not want to do this in any partisan way because I honestly do not believe that we can attribute the economic success or failure of a country like Canada entirely to the actions of a particular federal government.


Walter Gilbert Dinsdale: I agree.


John Ross Matheson: I believe the federal government has a very important role to play, but oftentimes there are circumstances and forces which are beyond the power of a particular government. Therefore I would ask hon. members to consider some of the problems facing Canadians at the moment. I remind them of the statistics available with respect to investment as a percentage of gross national expenditure. I have been reading some of the extracts from some of the publications concerning growth which have been appearing in the Economic Journal of the United Kingdom. It appears that in a good deal of the texts on this subject a very important index of success economically is the extent to which an economy invests as it goes along. I think capitalist countries must be rather concerned about this at the moment in making certain investment comparisons with, for instance, the Soviet union.
Now, Mr. Speaker, what is the situation in Canada? With respect to the investment in housing and social capital, in 1956 Canada invested 9.9 of the gross national expenditure. In 1962, the year which reference was made as the great year-


Walter Gilbert Dinsdale: The good year.


John Ross Matheson: The good year-9.4 per cent of the gross national expenditure was invested. In other words, the emphasis on housing and social capital in that good year shows a substantial decline. When we look at business investment, private and public, we find in the year 1957 an investment of 17.7 per cent of the gross national expenditure, which dropped down in 1962 to 12.2 per cent.
The hon. member who has just taken his seat spoke about the great importance of the private sector. I believe all of us on this side of the house are prepared to support him in that. The economic climate is terribly important. But the fact is that the climate was such that there was a sharp decline in the business investment area from 17.7 per cent

former government. We like to believe that there are improvements. We hope there are. We think that the duties of the council as set out in clause 9 are much more specific. We think that the power of the council to initiate studies gives the council freedom-freedom from the minister, freedom from the government of the day. We believe that it gives the economic council a chance to grow and to be creative on its own, and to give positive leadership. We think that the burden with respect to publication and the duty to produce an annual review is the kind of thing that Canada needs to bring the old Gordon commission up to date, to project, to look ahead, to give what the French in some of their literature have referred to as "prevoy-ance".
We know that there has been a certain exercise in semantics in the house. Some people talk about indicative planning. Some people are concerned that perhaps there will be creeping socialism. We have even had some suggestion that there is a form of syndicalism involved here. We can see all manner of difficulties that could develop as a result of this council. One thing, for example, that could happen is that we could make such poor appointments that virtually what we would be doing would be putting the most important lobbying groups in the country in a position where they could tamper with the federal government to the point of having a special influence and voice, and thus perhaps simply preserve vested interests. I hope that will not happen.
I hope that in making the appointments there will be a genuine attempt to ensure that they shall be representative, and I hope also representative of some of the best academic opinion. It is about time that we recognized those people who are trained in economics and who know something about general interests as distinct from private and special interests. We must have representatives of people in business who are prepared to take risks and think in the largest and broadest way. If we look at the situation in Britain, the Neddy committee presided over by Reginald Maudling, we can see that it is possible to have big men on this kind of council, men whose special interests to some extent cancel one another out and who are prepared to reach some sort of economic consensus.
We have not been able to articulate and enunciate adequately the consensus that I think most of us in this country share. Personally I was very disappointed in the budget debate. It was more preoccupied with personalities than with policy. But we seem all agreed so far as the grievous imbalance in our trade situation is concerned. We are concerned

about the lack of productivity of Canadian labour. We are concerned about the emigration of particular skills. We are concerned, I think, that so much of our agricultural market is now directed to a certain group of communist countries and that we have lost that diversification of market which in the past we enjoyed.
I do not think we can actually blame the Conservative administration for these changes. Let us collectively face these problems fairly and factually. Personally I feel that the fact that there is a minority government at the moment offers perhaps the most hopeful possibility of Canada reaching some kind of new consensus on economic matters.
The United States has had some experience with its employment act of 1946. I know there are people in the New Democratic party who feel that this was a very faltering, stumbling and hesitant step. Perhaps the achievements of that group in the United States would not satisfy the distinguished member from Northumberland. But the Americans have had a great tradition of reliance on the private sector and it was in the private sector particularly that they found they needed a council of economic advisers. Why? To prevent depressions, to maintain a high level of employment-although heaven knows it has not been high enough-to bolster production and purchasing power. The objective of their council of economic advisers was to place the economic development of their country under continuous scrutiny, to make policy recommendations to the president and to give the United States the ability to look ahead, or what I have referred to as "prevoyance".
We want research and analysis, the determination of objectives, the discovery of alternative solutions, the formulation of policies, the execution of a plan. This council cannot do anything, of course, except indicate; but it is very important to indicate, and when the appointments are made by the government I hope that a great deal of emphasis will be placed on the chairman and the two other permanent members of the council.
I agree entirely with the hon. member for Port Arthur (Mr. Fisher) who made an excellent speech on this subject. It seems to me that we will be going places with this council if the permanent secretariat is strong and is made up of people of great ability and distinction, and with a certain amount of personal influence and power. If in making up the total board of 25 there are selected top ranking men from industry, labour, agriculture and so on, I believe that these men can sit down and face facts, perhaps more easily than we can ourselves. I think that already they are aware of many of the facts. I have had businessmen tell me that even if
Economic Council of Canada an industry has to face difficult times ahead it is better that it should know the facts. For example, if a sector of the textile industry has to face the prospect of going out of business because it is going to be replaced by something else that is more productive, it is far better that the industry should know what the future holds in order to move sensibly and wisely.
After all, today there is not the sharp cleavage between capital and labour that prevailed in the time of the early private entrepreneurial organizations. To my knowledge I do not know one person who really is a capitalist in the full sense of the word. The people who run the 10 to 12 industries in my home city are really labour people. They are a part of management. They are highly skilled and highly trained. Very few of them own very much in the way of stock, perhaps just a little by way of token ownership; but essentially they are not owners. They are management and they are trying to do a scientific and wise job. Therefore I emphasize the fact that if we are going to make the economic council of Canada vigorous and strong the most important thing is the appointments.
I have been somewhat concerned about the wording appearing in clause 4, subclause 2, which provides that each of the other members of the council shall be appointed after consultation with appropriate representative organizations, to hold office for a term of three years. I hope that when the government finally proceeds to make these appointments, if the bill is passed, they will look for top quality in each appointment; and that is not obtained simply by appointing the person who happens to be the president or secretary treasurer of a certain organization. When we look at the British appointments to Neddy I think we are satisfied there has been a certain amount of wisdom shown in the choice of those people who represent, for example, the rubber industry or the cotton industry. The man who represents, for instance, the academic community is a person highly advanced in the economics of labour a man head and shoulders over other people in his field. The representative of the national coal board happens to be the chairman. We have, of course, people in high positions representing unions, representing boards of trade and so on. In my opinion, the quality of these important appointments is of primary significance.
The danger is, of course, that with a large 25-man board, it may become a meeting society to talk, dine occasionally and move off in directions that really accomplish very little. I hope, like the hon. member for Port Arthur (Mr. Fisher) that the permanent

Economic Council of Canada secretary, the chairman and his two permanent members, will be men of individual ability and talent, that they will work as a team and that we will have before us annually for consideration the kind of report which is in substance a little Gordon commission report. It is this kind of thing that I should like to see. Of course they may go off in various productive sidetracks. They can develop interests in special areas, and these will be necessary; but largely this is going to be a board that is thinking not in terms of tactics, the mechanics of production, but essentially in terms of economic strategy and projecting a plan for growth covering the next decade, two decades or perhaps even longer.
We know that there is going to be foreign investment in this country. We do not want to see ourselves cut off from capital. It seems to me that the great adventure of this particular decade for Canada will be the progressive steps taken by government to make us part of the new international community. We must preserve the general interest and become more objective. We must become more involved in every respect in foreign aid, in our involvement with other nations on this continent, in Europe and elsewhere. It seems to me that there will be a sharp shift from the kind of economic nationalism that has prevailed in this country pretty well since confederation, that is the significant change that is going to take place. I believe that this is in the long-run interest, not only of the maritimes, not only of the agricultural west, but even of the highly developed and industrialized areas of Quebec and Ontario. I believe that the areas in which we are going to make startling progress are those areas in which we can at last compete on a larger scale.
I hope sincerely, Mr. Speaker, that we can approach this new concept of planning, not in the sense of thinking that any small group of people are so much wiser than other people, but that Canadians must work progressively towards this new economic consensus, this new harmony, this larger cooperation between the productive elements. I look particularly for co-operation between the private and public sectors, as was stressed by the hon. member for Northumberland (Miss Jewett). This is important. She stressed a fact of life in Canada, that approximately one third of our investment, about one third of our employment, is dependant upon the public sector. We are going to blind ourselves entirely to these important considerations if appointments to this council are directed only to the private sector.

On the other hand, I think the members of our group do believe that we must and can plan for increased competition, and that capitalism has virtue only if it is competitive. This is the thing for which we are striving. It is said that the first aim of a government is to create an atmosphere for economic growth. The first objective of any sensible economic system must be to increase the wealth of the community. One listens with some little concern to statements about the likelihood of our hurried implementation of certain social security programs when we really do not know how large an economic pie we are going to have to distribute. Personally, I am just a little old fashioned about this, and I look with anxiety on the fact that we are urged to spend before we know where this money is coming from. This is perhaps the result of a Presbyterian background; I don't know. It seems to me that if the economic council can help to bake the larger pie then, in our wisdom, we can attend to this necessary process of redistribution which finally brings justice to every element in the community.
(Translation):


Mr. Henri Lalulippe (Complon-Fronlenac):: Mr. Speaker, planning is one of the purposes of this legislation. Now, the purpose of economic activity has always been to increase production with the least possible efforts.
We are endeavouring to establish a temporal social order in which the human being could live normally to attain its complete fulfilment. Controlled planning which seeks to determine the right to production based solely on labour devoted to that end, becomes increasingly dangerous with the advance of applied science.
Such a result could be expected, as this is contrary to the natural order and takes a means for an end. Economics are intended to provide goods, and not to control or govern people. Labour is considered as a means to some extent, as far as it is necessary to reach an end.
To associate money, which is the right to production, solely with labour, is therefore to subordinate the end to the means. In short, it is more than a surrender, it is a shameful humiliation, inasmuch as modern progress increases the level of production.
To associate money solely with employment leads necessarily to state control with all its resulting perils and subservience.
Workers get paid to produce consumer goods; but since machines and men have

become inseparable, the price of those consumer goods far exceeds the money distributed to workers in return for their participation. Since the market is already flooded, very few are interested in setting up new factories in such conditions.
That is where the government is forced to intervene, but since it clings to old principles and it does not want to create debt free money, it has to take the money out of the pockets of the taxpayers, either through taxation or loans. Then, to save the principle of money based solely on labour, it has to employ people under the conditions of patronage which corrupts politics.
Here again, in a world of conflict, the production of cannons, machine-guns, planes, nuclear arms and means of destruction of all kinds becomes a magnificent introduction. Not only does the production of goods which are not for sale ensure the distribution of money, but it does not create the same problems as the production of ordinary capital goods, since there are no commodities to be sold.
On the contrary, if cannons, bombers and torpedoes are put to work, they destroy great quantities of all kinds of goods, and this greatly helps to reduce supply to the level of purchasing power and, at the same time, it paves the way for reconstruction which will keep a lot of people busy.
Since the aim of economics is employment, war is a godsend for civilized countries where automation throws so many people out of work.
That is why we claim that to base money solely on work is to call for excessive intervention by the state with all the disorders that such an intervention entails. It is also for that reason that war is the ideal means of restoring the balance between the products on the shelves and the money in the consumer's pockets. In fact, the more machinery you have-under present regulations-the closer you are to war, which increases the amount of money in circulation while it cuts down on surplus goods and labour.
A more humane way to get out of this situation would be through a social dividend, by creating money to increase purchasing power directly and to bring it to the same level as the supply of consumer goods. Thus, instead of fostering war, machinery would justify the payment of a dividend to every member of society.
That is also why we say that if socialist countries had applied Social Credit, they would have brought about in the world,
Economic Council of Canada through the example of the larger countries, an economy of peaceful prosperity, and mankind would have considered them as geniuses and honoured them as great benefactors. But the Social Credit dividend is not on better terms with the Marxist or the Bolshevist philosophy than it is with that of the banker.
Dictators, in Berlin or Moscow, like the modern banker, control the community's credit, and use it in a dictatorial way, now to make cannons, now to get the community into debt; both despise the individual, both are out to dominate the world. Worship of race, worship of money, a terrified world under the jaws of the death bellowers, a world kneeling under the burden of ruinous and unpayable debentures; bend or break, pay or die.
Prosperity does not depend on a constant favourable or unfavourable trade balance, a monetary instrument does not need gold to play its part. It is the unemployment of money that causes the unemployment of men, and the injection of new money would give new life to our whole activity. With money geared to the needs of the country, it would be possible to protect Canada from recessions.
If the money supply regulated by the government eliminates stagnation, the ownership of money in the hands of the government would direct activities and constitute a real dictatorship of government on the economic life; it would be a replacement of banking dictatorship by government dictatorship.
If, on the contrary, by way of deduction, money originally placed in the hands of consumers controlled the economic life according to the desires of the consumers, it would be a social economic democracy in which freedom would flourish and against which any endeavour of planning or dictatorship would not have any chance.
The policy of your proposed planning- only salaries to workers and interest to sponsors-will never solve this problem, since progress reduces the number of wage-earners, and it is because we hold on to the policy of salaries and interest that thousands and millions of human beings starve to death, cursing progress instead of being thankful for it. That is why Social Credit advocates the distribution of dividends to everyone to enable him to buy his share of progress.
I say his share of progress. Progress is the result of science which, in conjunction with the individual work of the inventor and the sponsor who are rewarded in the normal way, justifies the latter. But accumulated science which is a common wealth, plays an

Economic Council of Canada Important part in invention and progress. So what is left after the capitalist and the inventor, as also the workers, have been rewarded; so it is the share of the accumulated science that belongs to everyone.
That is why all the good things which remain unsold, all the good things salaries and interests do not buy belong to everybody and everybody must be entitled to his share, instead of letting those things deteriorate and stop progress.
And who is to see that everybody gets his share of the progress made? The government, since it is the government that acts for everybody and is responsible for the common good.
There are two ways of enabling people to buy their share of progress. First, by reducing the price of goods so that one may buy more with each dollar; second, by increasing the number of dollars in people's hands.
Progress in the volume of production requires progress in the money supply. Where it is enormous in the first instance, it must also be made enormous in the field of distribution. Those who stick to the old method of financial distribution are enemies of progress as far as distribution goes; they are paralysing the advance of progress in the field of production and are paving the way for the progress of revolution. Just like progress distinguishes man from beast, Social Credit distinguishes the intelligent from the stupid.
The government of a country surely has the right to manage, to legislate, to implement for the good of all, the prosperity of all. The government holds that right or, to put it another way, that judicial power. It also has the physical power, the implementation power, it is capable to find the men, machines and tools needed to serve the community. But it happens that the government does not feel it has the financial power. It is always on the financial side that its action is limited.
That means that even with unchallenged judicial power and almost unlimited physical power, the government is immobilized by the lack of financial power. The same conclusions hold true with regard to centralized, planified government through Bill C-72 dealing with economic planning and submitted in this house by the minister, who is an economist to boot. Judicial and physical powers are not enough without financial power.
The minister is very careful to keep far away from the financial power.
[Mr. Latulippe.l

That is why, while claiming rights for every individual, while requesting the greatest judicial power for the lower bodies, we maintain that unless financial power is also given to individuals, corporations and governments, the economy will remain at a standstill, plans will remain unimplemented, some reports will gather dust because they will not be read-the minister is aware of that-citizens will remain destitute and unemployment will increase.
Budgets will keep on showing deficits, citizens will be taxed more and more, goods will remain on the shelves in spite of urgent needs. Men will remain unemployed next to rusting machines.
We are not against the price of butter rising to enable farmers to show a profit, but the reasons given by the professor of economics are nothing short of capitulation before a set of figures. Adjust the individual, adjust the consumer, adjust demand to supply, always the wrong way: man is sacrificed. When shall we see the bright ones asking for an adjustment of the purchasing power?
To production capacity, money in hand, the consumer orders what he wishes, and as he pays, production adjusts itself to demand as it should, and man remains the master.
The proposed plans and the planned economy will tell us what to produce, what to buy, how much, at what specific time and what are the individual basic needs for this and that. Planned economy will make all individuals and all appetites equal because the great men, who are not equal, will have decided so. Planned economy may be an amusing game for those who play it, for those who plan it. But it is much less attractive for those who are subjected to planning upon whom planning is imposed.
The trouble with monopoly is that power is held by those who control it. Through planning, you are going to replace private monopoly by state monopoly.
That would only mean changing a group of controllers for another one even more important.
The government employees in charge of nationalized industries could dictate the kind of products, the quality of production, the choice of employees, the salaries paid and the selling price of the products.
There is no place for competitive industry which endeavours to please the public better. Only one authority, that of the government, would control production. And if planning and socialization put such a vast and concentrated power in the hands of a political party, what could be done to get rid of it? They

would have the power. It would mean the simultaneous control of industry, finance and policy. And, to administer that tremendous government control, you would have to set up a large government bureaucracy. People may imagine what such bureaucracy would be, considering the one established since the war by the Ottawa government to control industry and business.
The plans conceived by the hon. minister are merely plans to activate production, create methods and increase the yield, so that there is no problem in this respect. The issue is with regard to distribution, and why not take nature as a model.
The sun and the atmosphere function automatically and are only subject to variations due to natural and normal causes. They are giving us the results for which they were created.
The same should be the case with the monetary economic system. It ought to give people the means of buying the fruits they are able to produce. It ought to be such that the consumption of goods equals production, and those results should not entail the danger of so-called sound financing with its pyramids of debts, its usury, taxes and artificial scarcities.
There is only one rule for money: there must be enough to set in action all the legitimate trade. It is bad when there is not enough or too much. If our country can issue one dollar bonds, it can issue one dollar bills as well. The same factors that give value to the bond would do the same for the bill. But there is a difference in that the bond enables the money dealer to be reimbursed twice.
That is how financiers bring about their control without being interfered with while groups tear one another to pieces without solving anything.
It is impossible to solve the dilemma without wiping out the debt-money system. Only Social Credit has the solution.
(Text):


Mr. Cameron (Nanaimo-Cowichan-The Islands):: May I call it ten o'clock, Mr. Speaker?


John Whitney Pickersgill: I think, sir, we would like to get on with the business of the house, and so far as we are concerned we would be very glad to hear the hon. gentleman for so long as he likes to speak.


Colin Cameron: Mr. Speaker, I do not think I will take advantage of this unusual generosity on the part of the Secretary of State (Mr. Business of the House Pickersgill) but if, as he has indicated, it is necessary to fill in one or two minutes until it is ten o'clock, then I will proceed to do so.
I was quite interested when I read rather carefully the speech of the President of the Privy Council (Mr. Lamontagne) in introducing this measure, in which he said: "Its purpose is to establish economic planning in this country". I have read the bill through with very great care and I can see no possible grounds whatever for this particular deduction. I must say, Mr. Speaker, that I was very disappointed this evening. I had hoped to have the opportunity of striking a blow for biculturalism by remarking on the fortunate conjuncture of name and function with regard to the introduction of this bill and then, alas, the hon. member for Pontiac-Temisca-mingue (Mr. Martineau) dealt with it ahead of me. But when I look at the bill itself I can see no reason for the minister's optimistic statement that its purpose is to establish economic planning in this country.
Nowhere in the bill does it suggest that there is to be anyone who is to have the authority to plan. What we are going to have is a number of people who will be asked to compile various statistical data and make economic forecasts; but nowhere is there any suggestion that there is to be any coherent plan produced. In fact I would say this is merely an attempt to correct by unplanned operations the results of planlessness while maintaining the conditions under which planlessness will continue inevitably. It is rather like refusing to take the wheel, but asking passengers to lean first to port and then to starboard in the hope that they may perhaps in some way affect the course of the vessel. Of course, Mr. Speaker, this is very handy when those who are in charge of the navigation appear to be so uncertain as to the destination that should lie at the end of their course.
Now, Mr. Speaker, may I call to your attention the fact that it is ten o'clock.



BUSINESS OF THE HOUSE

Gordon Minto Churchill: Mr. Speaker, may we have from the house leader an indication of the business for the other days of this week.


John Whitney Pickersgill: It was understood on
Thursday that we would begin the budget resolutions tomorrow, starting with the resolutions respecting the Customs Tariff. I assume they may take a good part of the day, but if we should conclude the Customs Tariff resolutions we would then go on with one or other of the remaining resolutions. I would like to maintain a little freedom as to which

Business of the House one that will be and I will let hon. gentlemen know the first thing in the morning, because I have not had a chance to consult the Minister of Finance about the order in which he wishes to have them go on.
It was understood that the budget resolutions would also be the business for Wednesday. On Thursday, as the Prime Minister

indicated earlier today, the Minister of National Health and Welfare would like to begin the debate on the resolution regarding the Canada pension plan. I would like to talk to hon. gentlemen about Friday before making an announcement.


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


[Stage Direction]
Ottawa, July 12th, 1963.
(Copy of letter sent to the premiers of all the provinces)
Dear Premier	
The replies that I have so far received to my letter of June 20th indicate that the premiers of the provinces generally look with favour on the suggestion of a federal-provincial conference to discuss matters of mutual interest in the sphere of pensions and related insurance benefits.
It is now expected that the resolution regarding the Canada Pension Plan, which I sent to you with my earlier letter, will be moved in the House of Commons next week. At that time the Minister of National Health and Welfare intends to make a statement fully outlining the government's proposal. Copies of this statement will be sent to you as soon as it is made.
The provinces will therefore shortly have before them the information needed in order that there may be useful federal-provincial discussions about pensions. This is already the case in another matter of interest to the provinces, namely the federal government's proposal to promote increased employment
by financial assistance, in the form of loans with provincial approval, to enable municipalities to augment or accelerate their capital works programmes. This proposal has been set out in detail in the bill which is before the House of Commons.
I think it would be of value to the public, as well as to the governments and others directly concerned, if federal-provincial discussions on these two matters were held as soon as possible.
Accordingly, I am now writing to enquire whether you would be able to attend a two-day conference in Ottawa on July 26th and 27th.
In addition to discussing pensions and this assistance to municipalities, such a meeting would provide opportunity for consideration of the procedure and timing of a full federal-provincial conference later in the year.
I would propose that the conference on July 26th and 27th should be held in camera, though of course each of us would be free before or after to make such public statements as he may wish regarding his government's views on the subjects under discussion.
Yours sincerely, (signed) L. B. Pearson


[Stage Direction]
Province of Quebec
Quebec City, July 11, 1963.
The Right Honourable Lester B. Pearson, P.C., Prime Minister of Canada,
House of Commons,
Ottawa, Ontario.
Mr. Prime  Minister@: Following my letter to you of June 7, 1963, asking you not to proceed with the establishment of a municipal loans fund until the provincial premiers have had an opportunity to confer among themselves in the matter early in August. I feel I should formally draw your attention to a resolution that was unanimously agreed to in the legislative assembly on June 26.
Herewith is a copy of that document.
I must add that I am sure of expressing the unanimous feeling of the members of the Quebec legislative assembly when I say that they consider as a breach of your promise fully to respect provincial rights, in your management of the affairs of this country, the fact of proceeding unilaterally to establish a municipal loans fund which, according
to your platform, was to be instituted solely in co-operation with the provinces.
Under the circumstances, your attitude forces me, most regretfully, to table this letter forthwith in the legislative assembly.
Please accept, Mr. Prime Minister, the assurance of my regards.
Jean Lesage.

EXTRACT from the minutes of a meeting of the Quebec legislative assembly, held June 26, 1963:
"Moved by Mr. Dozois, seconded by Mr. Ducharme:
That this house feels that Bill No. C-76, respecting the "municipal development and and loan act", which was introduced in the House of Commons by the Minister of Finance of Canada, is a serious infringement upon the exclusive jurisdiction and the autonomy of the province of Quebec in matters pertaining to municipal affairs, and requests that the provincial government consider the1 possibility of establishing a provincial system of municipal credit which would facilitate municipal loans."
Motion unanimously agreed to."
Certified true copy:
Antoine Lemieux,
Clerk of the Legislative Assembly.

Tuesday, July 16, 1963