1963-10-25

Mr. Speaker:: Following a recommendation made by the commissioners of internal economy at a meeting held yesterday, I beg leave to table copy of a report of a survey of the English debates reporting branch, House of Commons, by the management analysis division, advisory service branch of the civil service commission, dated January 1963.



PRIVILEGE


[Stage Direction]
"GLOBE AND mail"
Hon. Marcel Lambert (Edmonton West):: Mr. Speaker, I should like to raise a question of privilege affecting all hon. members of this house because I feel there is a rather unfair commentary on the proceedings of this house appearing in an editorial in this morning's Globe and Mail. Reference is there made to the debate which took place in this house very briefly last Friday consisting of a speech lasting some 15 minutes by the Prime Minister, and a debate lasting about an hour and a half to an hour and 40 minutes the day before yesterday, concerning the setting up of the committee to deal with the procedures of this house.
It has been suggested, Mr. Speaker, that this was a waste of time. May I say, sir, that I feel it would be quite improper to so suggest since the house limited itself to statements by leaders of the parties, and I myself spoke for a period of less than three minutes. Certain things were said during the course of that debate which could not be said in committee. They were matters for the house to consider during the course of that debate. Under the circumstances I feel that the inferences drawn and some suggestions contained in the editorial were quite unfair to this house as a whole.



MR. OLSON    ATTEMPT TO CALL MEETING OF AGRICULTURE COMMITTEE

Mr. H. A. Olson (Medicine Hal):: I rise on a question of privilege that concerns all members of this house and which, I suggest,
28902-5-254
has become urgent in the last few days. Yesterday evening I addressed a letter to the chief of the committees and private legislation branch, and I wish to quote that letter:
Dear Sir:
I wish to request that a meeting of the standing committee on agriculture and colonization be called with all convenient speed for the purpose of selecting a chairman and other officers.
I further request that the committee be asked to consider and investigate the wide difference between the price received for feed grain by the producers in western Canada and the price paid by livestock feeders in eastern Canada.
Yours truly,
H. A. Olson.
I received a letter in reply, which I also wish to quote:
Dear Mr. Olson:
Your letter of October 24 requesting a meeting of the standing committee on agriculture and colonization has just been handed to me.
As I indicated to you over the telephone, I have no authority to call a meeting of any parliamentary committee. However, I am passing your request on to the chief government whip who, according to practice, advises me with respect to organization meetings.
Yours very truly,
Antonio Plouffe.
I suggest, Mr. Speaker, that there is precedent for raising a question of privilege such as I have in mind. I do not intend to quote all the evidence which is contained in the official records of this house, but it is reported in Hansard for April 16,	1935,
volume III at page 2768 that a member of the staff of this house wrongfully interfered with the rights of a member. The point I wish to make now is that a member of a standing committee which has been set up does in fact have the right to request a meeting of that standing committee, and the officers of this house are under obligation to call such a meeting.
Standing order 65(l)(f) provides for the composition of a standing committee of the house on agriculture and colonization, to consist of 60 members, 20 of whom shall constitute a quorum.
On Thursday, June 27, 1963 this house concurred in the composition of such a standing committee and resolved that the committee be empowered to examine and inquire into all such matters and things as might be referred to it by the house; and to report from

Agriculture Committee time to time its observations and opinions thereon, with power to send for persons, papers and records. That will be found in Votes and Proceedings, June 27, 1963.
At this point the committee was fully constituted and in existence. It was, as the law has it, no longer in posse but in esse. It will continue so until the session ends or it is de-composed by action of the house. Its first function is procedural; that is, to appoint a chairman. Its second function is substantive; that is, to consider matters referred to it by the house and to report back thereon to the house. The committee, in the absence of regulation, is its own master of the first function, the appointment of a chairman. And every member being equal, each member of the committee has the right to call the committee to assemble at a particular time and place to elect a chairman. If a member exercises this right, the other members of the standing committee indicate their approval by assembly of a quorum at his call; if a quorum does not assemble, then the committee has indicated their disapproval of his call.
This is the general law governing public assemblies. It can be varied in any particular case by a governing authority. The Canadian House of Commons has not altered this general law by its standing orders. Standing order No. 1 states that where we do not provide for a case, the usage and custom of the United Kingdom House of Commons shall apply. But the United Kingdom House of Commons does not have a usage or custom; it has a particular standing order which provides for the manner in which a standing committee chairman is appointed, United Kingdom standing order 62(1). This standing order, and standing order 96(4), set up a particular machinery which we do not have and therefore cannot utilize. Mr. Speaker of the United Kingdom house appoints a standing committee chairman from a panel of members chosen by him at the beginning of the session called the chairmen's panel.
The United Kingdom does have a usage, but it applies only to select committees. Upon the select committee being appointed, its senior member fixes the time and place of the first meeting. For this purpose the senior member is the member who has the longest term of service, adding together his various periods of service in the house. This can be found in the book "The House of Commons At Work", by Eric Taylor, page 183.
The United Kingdom authority, Sir Reginald Palgrave, states that the member or members who call the meeting to elect a chairman have a further right; that is, to propose a president to conduct the meeting if more than one name is put forward for

chairman. In his authoritative work, "The Chairman's Handbook", he says:
A chairman may be called upon to take the chair with the general approval of the assembly. If the call, however, be challenged, a member of the meeting of influential or official position, who is not prepared to undertake the office of chairman, should be requested to act as president during the election to the chair. And, subject to specific rule to the contrary, the right to propose such a president lies with those who have called the meeting. Their proposal, therefore, should be accepted without dispute; they, on their part, acting with the sole object of securing the right conduct of the election to the chair.
A standing committee, or a select special committee for that matter, is a portion of the house and is not subject to the control of the government or the executive branch. That can be found in Beauchesne, fourth edition, citations 288 and 296. In citation 296 he says:
A private member's notice of motion that the government should give consideration to the advisability of setting up a special committee of the house is out of order for it takes for granted that the government is vested with the right to appoint committees of the house. The executive power cannot encroach upon the legislative; they are both distinctly described in the British North America Act where it is also stated that the constitution of Canada shall be similar in principle to that of the United Kingdom.
It follows then, Mr. Speaker, that to suggest that a standing committee assembles to elect a chairman at the call of the government whip is to pile absurdity upon absurdity and to introduce a rule of tyranny into our democratic procedures. And it is even more absurd to introduce the fictional, as far as this house is concerned, government whip as the controller of the standing committees of the house.
So, Mr. Speaker, I suggest there has been a wrong interference by an officer of the house with respect to a member's right to call a meeting of a standing committee. Further, yesterday the Secretary of State said that any member of a standing committee can call a meeting of the committee on request that a meeting be called. If you will look at Votes and Proceedings of June 27, Mr. Speaker, you will see I am a member of this standing committee that is in existence.
Hon. J, W. Pickersgill (Secretary of State):
Mr. Speaker, if I may I should like to say a word or two to indicate how completely I agree with what the hon. member for Medicine Hat has said. I think we are all indebted to him for the research he has done on this subject. I must say I spoke without having made any study of the question, but I am very glad to be told that I am right because when he first rose I wondered whether I might perhaps have been wrong.
I think it would be quite insufferable if the chief government whip or any other member of the house had any greater rights than any

member of any committee set up by the house to ask that the committee be constituted and set up properly. Of course, once it is, the chairman has certain functions that are traditional. I have no doubt it has been the custom, as a convenience for these committees to be set up at the suggestion of the chief government whip. I daresay that has happened. I have not had too much to do with this sort of thing but I daresay that may have happened over the years. I am sure no official of the house meant to do any wrong or to show any contempt for the house, and I do not think the hon. member suggested that for a minute.
I do feel that perhaps now the matter has been aired there would be a consensus along the line the hon. member has suggested, that any member of a committee set up by this house could have the committee called together if there had been any delay in that respect. I hope that will be the universal view in the house.


Mr. Arnold Peters (Timiskaming):: May I
say that there is a notice being prepared in my office this morning calling for a meeting of this committee at nine o'clock on Monday morning. I have canvassed a number of the members and believe a quorum will be in attendance in the railway committee room. I think we all owe the hon. member for Medicine Hat a great deal for the work he has done in connection with this matter, and I believe it will change the operations of committees in the future.


Mr. E. Nasserden (Rosthern):: I had intended to raise this matter today, Mr. Speaker, because I believe a wrong impression was left yesterday by the remarks made by the Secretary of State. It may be that any member can call a committee together, but until this house has given the committee some order of reference the committee has not anything to do except elect a chairman. I think that is the point this house should take into consideration. Yesterday I asked the Minister of Agriculture if he would submit to the committee on agriculture and colonization the stabilization act for study, and you will recall the answer I received on that occasion. Until this house gives the committee on agriculture and colonization something to deal with, it would be futile to hold a meeting.


Mr. Speaker:: There is no doubt about the importance of the question to all hon. members in the house, but we have had an extended discussion and I am inclined to think that while the matter is very important, nevertheless it hardly rates the designation of a question of privilege. I suggest to the 28902-5-254J
Agriculture Committee hon. member for Medicine Hat that perhaps on orders of the day he might direct a question along this line to the government.


Mr. T. C. Douglas (Burnaby-Coquiilam):: Is
Your Honour telling us now that a member of a committee cannot insist upon that committee being called together, and that instead we have to ask the government questions when the government itself, through the house leader, has specifically stated this is not the function of the government but the function of the house? We are asking that this house function properly so that the committees can be called together.


Mr. Speaker:: The distinction I was trying to make is that in my humble opinion the matter is more in the nature of a grievance or a question of procedure rather than a question of privilege. This is the only point I was trying to make. The house, I know, is always master of its own decision in respect of procedure. I do think, in view of the extended discussion we have had, that the air has been cleared, and I am just suggesting the matter might be left there in view of the explanation of the Secretary of State this morning.


Thomas Clement (Tommy) Douglas: May I just say to Your Honour that in our opinion this is most definitely a matter of privilege as it affects the rights of members to have committees called. So far as we are concerned, the question has not been cleared up until this committee is called and properly constituted. If it is not called and constituted fairly soon, we will take further measures to bring the matter before the house.


Horace Andrew (Bud) Olson: In my view, sir, the question of privilege involves more than just whether or not a member of a committee is permitted to call a meeting. The fact is that I formally requested an officer of the house to send notices or do all the things that are necessary to call the meeting together, and to notify the members of the committee that a meeting should be called, and he says he has not authority to call this meeting and is waiting for the government whip to do it. The point is whether this officer of the house acted properly in refusing to send out the notices after I asked him to do so.


Mr. Speaker:: In view of the importance which all hon. members attach to this matter, and which I do too, I am sure they will not object if I take the matter under consideration and take time to study the long memorandum submitted by the hon. member for Medicine Hat, reach a decision on it, and report to the house in due course.

Agriculture Committee


Edward Nasserden: Mr. Speaker, I move, seconded by the hon. member tor Joliette-L'Assomption-Montcalm (Mr. Pigeon):
That with the unanimous consent of the house it be an instruction to the standing committee on agriculture and colonization that they have the power to inquire into the operations and policy and financial structure of the Agricultural Stabilization Act and board and to report to the house their observations thereon.


Mr. Speaker:: Has the hon. member unanimous consent of the house?


Mr. Pickersgill:: I wonder, sir, if we could
see the motion first.


Mr. Speaker:: It has been moved by the hon. member for Rosthern, seconded by the hon. member for Joliette-L'Assomption-Montcalm:
That with the unanimous consent of the house it be an instruction to the standing committee on agriculture and colonization that they have the power to inquire into the operations and policy and financial structure of the Agricultural Stabilization Act and board and to report to the house their observations thereon.


John Whitney Pickersgill: Mr. Speaker, there is no desire on the part of the government to restrict any inquiry in any way, but this is a rather unusual procedure. I suggest that Your Honour take the motion under advisement, and perhaps that question could be considered on Monday. In other words, if I had to rely on the rules I would say that today there is not unanimous consent; but in an attempt to be as conciliatory as possible I suggest that the question whether such a motion would be in order be considered.


Mr. Speaker:: If the house does not give unanimous consent, then I have no option under the rules of the house.


Mr. Frank Howard (Skeena):: Mr. Speaker, I wonder whether, during the time you are giving consideration to this matter, you would look at Hansard for the last session, wherein I asked unanimous consent to move a motion with respect to the north Pacific fisheries commission, to refer that matter to the standing committee on marine and fisheries. At that time the Secretary of State, then a private member, was the first to jump to his feet to offer unanimous consent.


Horace Andrew (Bud) Olson: Mr. Speaker, before you move on from motions I should also like to ask unanimous consent of the house to move a motion. Perhaps I should read it, and if you want to take it under advisement along with the other that would be acceptable. I move, seconded by the hon. member for Fraser Valley (Mr. Patterson):

That the standing committee on agriculture and colonization be ordered to examine forthwith, and inquire into all matters arising out of and relating to, the difference between the price received for feed grain by the producers in western Canada and the price paid by livestock feeders in eastern Canada: and the said committee report with all convenient speed the observations and opinions thereon.


Mr. Speaker:: Once more I must ask whether the house gives unanimous consent.


John Whitney Pickersgill: I hope, Mr. Speaker, you will treat this matter in the same way as the other, and take it under reserve.


Mr. Pigeon:: We would like the opinion of the Minister of Agriculture today.


Mr. Speaker:: I am advised, I am glad to say, that not having received unanimous consent on these two motions, or proposed motions, I should not take them under consideration. I do have to take under consideration the matters raised by the hon. member for Medicine Hat and discussed earlier this day; but I do not take into consideration the two motions which have now been moved unless I have unanimous consent. Not having that unanimous consent I propose not to consider them.


Mr. Diefenbaker:: The government having refused.


Some hon. Members:: Shame.


John Whitney Pickersgill: I can assure you, Mr. Speaker, that the government will give consideration to this matter, and I will make a report to the house on Monday.


John George Diefenbaker: Mr. Speaker, so that the record will be clear, the lack of unanimity arises by reason of the Secretary of State (Mr. Pickersgill) speaking for the government.


John Whitney Pickersgill: The Leader of the Opposition (Mr. Diefenbaker) is perfectly accurate, sir, in what he says.


Mr. Raymond Langlois (Megantic):: Mr. Speaker, these two motions resemble one which I presented yesterday to adjourn debate in this house, and I think the hon. member for Hull (Mr. Caron) got up and sort of blocked off my own motion. Again today the government is again blocking this agriculture matter.


Mr. Speaker:: Order. We must proceed with the order of business.



MR. PANE  PROVISION OF SIMULTANEOUS INTERPRETATION IN GALLERIES

Mr. F. J. W. Fane (Vegreville):: Mr. Speaker, I rise on a point of privilege. As everybody who sits in this house is aware,

the galleries of the chamber are visited daily by a great number of people who come here to listen to the deliberations of the house. I am informed that many of these people are not adequately bilingual in the two official languages of Canada and therefore cannot follow a debate in its entirety as well as they might wish, with the result that many leave here and express their unhappiness at this condition. They know very well that the members of the house and the press gallery have the advantage of simultaneous translation. Might I suggest that the proper authorities take under advisement the possibility of providing simultaneous translation in the galleries of this chamber.

On the orders of the day:


Mr. Prosper Boulanger (Mercier):: Mr. Speaker, I should like to put a question to the Minister of Public Works. Could the minister tell the house whether the government intends to take before long the necessary steps so that the simultaneous translation may be heard in the galleries of the House of Commons?


Hon. J. P. Deschatelets (Minister of Public Works):: Mr. Speaker, the Department of Public Works is considering providing simultaneous translation in the galleries as part of an overall improvement plan for the main block of parliament buildings.
The matter has been under consideration for about two months, and when the departmental engineers have submitted their report, the government will then be in a position to make a decision in this regard.



BANKING AND COMMERCE

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


Hon. C. M. Drury (Minister of Industry):: Mr. Speaker, I wish to announce to the house certain new measures which are being introduced by the government to foster greater production and trade in motor vehicles and parts for vehicles. An order in council has been passed which gives effect to the following measures as of November 1, 1963. They will supersede the provisions of P.C. 1962-1/1536 pertaining to the remission of duties paid on importations of automatic transmissions and stripped engines.
Plans to Increase Automotive Industry
The new measures provide for the remission of duties paid on importations of vehicles and parts for vehicles for use in the manufacture of motor vehicles in Canada.
The remission of duties on imports may be earned through exports of vehicles or parts in excess of exports made during the 12 months ending October 31, 1962. Exports to any country are eligible to earn a credit for remission of duties. Credits may be earned by vehicle manufacturers through exports by themselves or by the parts makers.
One dollar of exported Canadian content will earn the remission of duties on one dollar of dutiable imports. If full advantage of the plan is taken by industry, it could lead to increased production and exports of between $150 million and $200 million annually, and to the remission of duties on an equivalent value of imports into Canada.
The new measures will be in force initially for a period of three years. It is envisaged that a plan of this magnitude will result in substantial investment in new production facilities, and the planning and construction of new machinery and buildings requires a certain minimum time, even when pressed vigorously. The government will wish, however, to review the progress achieved under the plan at the end of three years and to be guided in implementing future measures by the results achieved in the interval.
The objectives of this plan are threefold; first, to increase production and create additional employment in Canada; second, to take an important step to improve Canada's balance of payments position; and third, to give producers of parts for vehicles and producers of vehicles a valuable incentive to achieve longer production runs and a greater degree of specialization, thus assisting them to reduce their costs. The plan involves no restriction to trade. The new measures do not require the enactment of new duties or other restrictive measures. They will be implemented entirely within the context of Canada's trade agreement commitments.
The government believes that the new plan will make substantial new production opportunities available to Canadian automotive industry producers. It should also help them to reduce costs, with benefits to them and to Canadian consumers. Furthermore, it is consistent with Canada's policy of solving our trade and balance of payments problems by constructive measures and not through restrictive actions. Under these new measures trade in both directions will be encouraged.
4000	HOUSE OF
Plans to Increase Automotive Industry
We feel that this measure will contribute to a greater flow of trade between Canada and its trading partners, and will place Canadian producers in a much better position to compete efficiently and effectively in Canadian and international markets.


Hon. George C. Nowlan (Digby-Annapolis-Kings):: Mr. Speaker, I am sure the house listened with a great deal of attention to the rather belated statement we have just heard. This, as we know, has for some days been the subject matter of discussion and controversy in Washington; it has been debated on the C.B.C., and I suppose it is fitting that on the last day of the parliamentary week we should be told in the house what the government proposes to do with regard to this matter.
This is, of course, a very important statement, and the house would not expect or would not want, even if the rules permitted, any discussion of the details of this proposal. This is in some ways in keeping with the program which was laid down by the government of my right hon. friend, now the Leader of the Opposition (Mr. Diefenbaker) in extending-


Some hon. Members:: Oh, oh.


George Clyde Nowlan: Some people should read their history books, Mr. Speaker.


Some hon. Members:: Hear, hear.


George Clyde Nowlan: This is in some ways in keeping with the program laid down by the former government in expanding the automobile industry. The first recommendation of the Bladen commission was that the excise taxes on automobiles should be remitted. That was done. The second measure that was implemented just about a year ago-and of course we anticipated something like this had to happen, because the year had almost expired -was when we allowed the duties to be imposed upon automatic transmissions and engines and gave a remission of duty on the equivalent export of parts, such as the minister has suggested is now to be extended still further. I am very glad to see that the minister is apparently following the path and the program which we established.
It has been suggested in other places and other capitals not off the North American continent that this is a terrible violation of GATT and that recrimination and protests are bound to follow. I hope this is not true. I would hope that this is within the framework of GATT, because I am sure the government realizes that it is inadvisable to offend any more people with whom we have to deal in our trading relations.
As I say, Mr. Speaker, this is a very technical matter and I do not propose to discuss it now. 1 suppose the minister, as Minister


of Industry, has no estimates coming before the committee in the next few weeks as have other departments; but as Minister of Defence Production we will have the estimates of his department before the committee, or possibly we can discuss this matter when our friend the Minister of Finance brings his estimates before us. In the meantime we will study the proposal and be able to discuss it in the house at some length at a suitable opportunity.
Mr. Reid Scot! (Danforth): Mr. Speaker, on behalf of the New Democratic party I wish to say that we are glad to have this measure placed before us after a great deal of discussion has taken place with regard to it in the public press, over the radio and on television. We recognize that it is an attempt, and I think a sincere one, to try to jolt the automotive production industry in Canada out of its traditional lethargy and bias against the production of automobile parts and equipment in this country for export purposes.
As was said by the previous speaker, the whole matter is one of great complexity, and it is very difficult at this point to even try to assess the response this measure will invoke, mainly because the automotive industry is owned largely in the United States. Therefore you have in effect the same companies producing on both sides of the border, and it is difficult to assess at this stage what type of reaction will follow, because you are not operating in the traditional market place or the traditional situation which might prevail among competing companies.
We have not too much detail this morning, so it is difficult to say what this measure really amounts to, but it does look suspiciously like an export subsidy; because in effect we are making a remission to the companies in return for exports. We are going to remit certain tariffs they are paying on goods they are importing, so to me it looks suspiciously like an export subsidy.
We hope this will not invoke any kind of retaliation from other quarters. We have been told that the United States government is urging the automotive industry in that country to band together to thwart this program. If this takes place it will create a difficulty for this government, and all of us certainly hope it will not happen.
The Minister of Finance, speaking the other evening in Hamilton, indicated that this program is going to be applied to other sectors of the economy. We hope that before this is done a great deal of research will be made available so that all people in Canada will have an opportunity to study it, and we will not get into programs that we may find it difficult at a later date to get out of.

On the whole, Mr. Speaker, it is a very complicated matter. We hope, as the previous speaker said, there will be some opportunity to examine this proposal in depth in the house, that we will have a chance to debate it, because it is a very important innovation in the Canadian community. We therefore hope that at some stage we will have an opportunity to examine this proposal in more detail.


Horace Andrew (Bud) Olson: Mr. Speaker, the announcement that has just been made by the Minister of Industry is, I think, a new departure in tariff arrangements. It is designed to balance both our trade and our balance of payments position with the United States. We have long pointed to the fact that our balance of trade in commodities and our balance of payments in non-commodity trade has been a problem for Canada and is growing worse year by year. It is impossible at this time to foresee or to even comment on the ramifications which may arise from this new departure. However, we hope it will be successful in balancing our commodity trade and also in assisting our balance of payments position.


Mr. Real Caouette:: Mr. Speaker, we have listened with attention and interest to the statement made by the Minister of Industry (Mr. Drury). It is time for Canada to break new ground in the field of industry, especially the manufacturing industry.
It is good to hear the government say the time has come to encourage the manufacturing of automobile parts in Canada and to see it take a step in that direction at last.
Something we do not like, however, is intervention on the part of the American secretary of commerce, Mr. Luther Hodges, to the effect that he probably would have to make reprisals to offset Canada's decisions. I am not anti-American, far from it. I am pro-Canadian, and I feel the United States should be glad to see other countries, including ours, show some initiative of their own. What we want from those people is not so much financial help as technical assistance to enable us to do through our own efforts what can be done in our own country.
Therefore, I sincerely congratulate the government for taking this initiative.
Although the hon. member of the Conservative party who spoke before me stated that this program had been developed by his own party, it remains that the Conservatives, when they were in office, neglected to put it into effect, whereas today the government is taking that responsibility.
Inquiries of the Ministry
And I, for one-and this goes for all the members of the group I represent here-am satisfied and happy to note that the minister has taken such action.



LABOUR RELATIONS


[Stage Direction]
On the orders of the day:
John George Diefenbaker: Mr. Speaker, the Norris commission report at page 306 recommended that:
-the president and other senior officers of the S.I.U. of Canada, including the present administrator of the S.I.U. welfare plan, should not be continued in office or employment in the union.
In view of that recommendation, would the minister say whether Mr. Banks has any basis for the statement he is reported to have made last evening to the effect that the trustees have informed him that he will remain in office or in control of the S.I.U.; and furthermore, would he comment on the interpretation thereof on the radio that there would be no interference in the internal operations of the S.I.U.? Would the minister take the house into his confidence and tell the house what passed between the trustees and Mr. Banks? In addition, so that we will have a clear picture, would he table the order in council appointing the trustees, if that has not already been done, and would he table the letter allegedly written by him whereby certain undertakings were given to the S.I.U.?


Hon. A. J. MacEachen (Minister of Labour):: Mr. Speaker, first of all I want to make it perfectly clear that I have written no letter to the S.I.U. at any time containing any undertakings. I did send a telegram to the president of the S.I.U. drawing to his attention one particular clause in the bill passed by parliament, and I think that telegram was printed in the press a couple of days ago. I want to make that perfectly clear.


John George Diefenbaker: Has that been tabled?


Allan Joseph MacEachen: I would be glad to make it available. As I recollect it, it has been made available to the press and it is open to anyone to see its exact terms, which simply rely on one particular clause of the bill.
I think I should make clear the status of the board of trustees established by parliament. Mr. Justice Dryer made it clear yesterday to the press, as I understand it, that the board of trustees is responsible to parliament and not responsible to the Minister of Labour. I share that view. The board of trustees in its operation is independent; it is
4002	HOUSE OF
Inquiries of the Ministry not under the direction of the minister or responsible to the minister except as provided in the act passed by parliament.
I wish to make it clear also that I have not talked to the trustees since the preliminary meeting, held the night before last, at which they made two decisions. I think I should explain that I attended this meeting along with officials of the department in order to assist the trustees to familiarize themselves with the legislation and to provide other material to them. At the time when they felt they ought to take decisions, they withdrew to a separate room to make their own decisions outside my presence, or the presence of any officials of my department, in order to emphasize their independence.
Since that meeting I have had no conversations with any members of the board of trustees, nor have I talked to them or received any report from them. I will say this, however; I have full confidence that the trustees will discharge their duties in accordance with the authority granted them by parliament.


John George Diefenbaker: A supplementary question. Were any such undertakings given as alleged by Mr. Banks, namely that he and his officers are to remain? That was the question. I also asked about the tabling of the order in council setting up the board of trustees and the particular message which was sent by the minister.


Allan Joseph MacEachen: I have already answered the first question. I have no knowledge, nor shall I ask the trustees in their particular capacity to report to me, since they are now in a sense officers of five unions, as to their day to day conversations with any person with regard to the internal operations of their unions. I have no knowledge, as I have stated, of any conversations; and if the leader of the opposition wishes to rely upon the statements of Mr. Banks as reported in the press, that is his business.


John George Diefenbaker: Banks said so.


Hon. Michael Starr (Ontario):: In view of the explanation and information which the minister has given to the house, would he also advise us as to how parliament is to be informed, or how the trustees are to report to parliament if not through some minister of the crown?


Allan Joseph MacEachen: That particular matter is covered in the legislation.


Mr. Donald Maclnnis (Cape Breton South):: Mr. Speaker, I have a question for the Minister of Labour. In answer to the question put to him by the right hon. Leader of the


Opposition the minister indicated that the trustees are now the officers of the five unions. In my opinion, in the trusteeship legislation just recently passed it was the desire of the house to rid the S.I.U. of Mr. Hal Banks; and considering the fact that the minister now says the trustees are the officers of the five unions-


Some hon. Members:: Question.


Mr. Mandziuk:: Just wait; take your time.


Malcolm MacInnis: Is it all right to go on, Mr. Speaker? In that the trustees are now the officers of the five unions, does the Minister of Labour think it is right he should now be further consulting with Hal Banks, when it was the desire of the house and the country to get rid of him?


Allan Joseph MacEachen: First of all, Mr. Speaker, I want to make it absolutely clear I have not had any communication with Mr. Banks, and made a deliberate effort to avoid any communication with Mr. Banks from the moment that management and control of the unions were vested in the trustees. I followed that course quite carefully. I want to make it clear that I have stated that because the management and control of the five unions are vested in the trustees, these trustees are now acting in a capacity as if they were union officers.


Malcolm MacInnis: As a supplementary question, when the right hon. Leader of the Opposition referred to correspondence, did not the minister inform the house that he had not written but that he had wired Mr. Banks?


Allan Joseph MacEachen: Yes, Mr. Speaker, but this wire was exchanged the day before, as I recall it.


John George Diefenbaker: The day before what?


Allan Joseph MacEachen: The day before proclamation of the trusteeship. The following day there was a reply to my wire, and I refused to acknowledge the wire from Mr. Banks because as of that day the management and control of the unions had vested in the trustees-


Some hon. Members:: Hear, hear.


Allan Joseph MacEachen: -and since then I have not been in touch with Mr. Banks.


Malcolm MacInnis: As a further supplementary question, in that the minister has indicated to the house that he personally is not responsible but the trustees are responsible to this house, does he not think it is his place to advise the trustees that this house does not want to deal any longer with Hal Banks and

should govern themselves accordingly? This was parliament's wish as indicated by the legislation.


J. Nicholas (Nick) Mandziuk: As a
further supplementary question to the Minister of Labour, according to press reports Mr. Banks has made the statement that he is still the president of the union and is to continue as such. Is he going to be an agent of the trustees or their servant, or in what capacity is he going to retain the presidency?


Allan Joseph MacEachen: As I have stated, the management and control of the maritime transportation unions are vested in the trustees, and this is a matter for determination by the trustees within the authority granted to them by parliament.


J. Nicholas (Nick) Mandziuk: But does not Mr. Banks' statement indicate that he is still going to run the union?


Allan Joseph MacEachen: As I have said, if my hon. friends want to rely on reported statements made by Mr. Banks, that is their business.


John George Diefenbaker: The present government relied on Banks' statements.


Thomas Clement (Tommy) Douglas: Mr. Speaker, may I direct a question to the Minister of Labour. Under the trusteeship legislation section 18 provides that the governor in council may make such orders or regulations as he deems necessary for carrying out the purposes and provisions of the act. Have any orders or regulations yet been passed by the governor in council and, if so, will they be tabled?


Allan Joseph MacEachen: No, sir, no orders or regulations have been passed.


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question to the Minister of Labour. When the minister answered an earlier question put to him by the hon. member for Ontario about the minister reporting to parliament on behalf of the trustees, we were told that this is provided for in the legislation. The minister will recall that this answer was applauded from his side of the house.
Based on another look at that legislation, may I ask the minister if that means we will get a report only within the first three months of 1964, and then only once a year; or will the minister remember his promise to the house as recorded on page 3504 of Hansard for October 11, that if it seemed necessary he would get an interim report and make it to the house? In view of that promise, will the 28902-5-255
Inquiries of the Ministry minister consider getting an interim report from the trustees and making a statement to the house early next week?


Allan Joseph MacEachen: Mr. Speaker, the trustees are obligated under the act, as my hon. friend is aware, to make certain reports. It seemed to me that a legal obligation is imposed-


John George Diefenbaker: Once a year.


Allan Joseph MacEachen: -in that way.


Stanley Howard Knowles: Once a year.


Allan Joseph MacEachen: I would be glad to discuss with the chairman of the board of trustees, at the earliest possible time, a method by which interim reports might possibly be made to the house. But I question whether it would be desirable, within 48 hours of these gentlemen having taken over their responsibilities, to ask them for an interim report. I would hope that hon. gentlemen would not expect, in any such report, to be informed of conversations which the board of trustees, in exercise of their responsibilities, have had with any individual or heads of any of the five unions.
This is what I had in mind when replying to the question earlier, not an interim report on the general activities of the trustees.


Stanley Howard Knowles: A supplementary question, Mr. Speaker. Would the minister note that my request was that he consider making an interim report early next week after the trustees had had a few days to get things going. Will he at that time try to report to us whether they are acting as trustees as required by the statute, or whether they are just acting as monitors?


John Whitney Pickersgill: Mr. Speaker, before the minister answers I should like to raise a point of order. I raise it because the hon. gentleman is an old and distinguished member of the house and is familiar with the rules.


Malcolm MacInnis: I rise on a point of order.


Mr. Speaker:: I am sorry; there is a point of order before the house at the moment.


John Whitney Pickersgill: My point of order, sir, is that it would appear to me that what the hon. gentleman is doing is seeking to engage in a debate on the meaning of an act recently passed by this parliament, not seeking information about the conduct of the government in accordance with the rules under which questions are asked in this house. I ask Your Honour to take this matter under advisement, as I did once before, and see whether perhaps all hon. members should not be reminded of

Inquiries of the Ministry the purpose of the question period, as was done by the hon. member for Edmonton West on several occasions in the last parliament.


Stanley Howard Knowles: Mr. Speaker, on the point of order, if it is a point of order, I suggest that I have a point of privilege. This house was told by the government to read the act, and that the only reports we could expect were those provided for by the act. On a point of privilege, I would remind the minister-


Allan Joseph MacEachen: No such statement was made by me today.


Stanley Howard Knowles: As a matter of fact, if the Secretary of State had not come to the assistance of the Minister of Labour he would have been better off. I rose to remind the Minister of Labour of the promise he made to the house on October 11, that if an interim report seemed necessary he would get it and make a statement to the house. All I did was to remind the minister of his promise, and he agreed to keep it. The Secretary of State would have been well to remain in his seat.


Malcolm MacInnis: Mr. Speaker, a further supplementary question to the Minister of Labour. In the answer he has just given to the hon. member for Winnipeg North Centre he referred to the fact that he did not think it was necessary that the trustees should report back any conversations they may have had with the heads of the five unions. Can this be interpreted as government recognition of Hal Banks continuing in office?


John George Diefenbaker: Mr. Speaker, as apparently we cannot get any information on whether Banks had an undertaking from the board of trustees, possibly the Minister of Justice could tell us whether final consideration has been given by the government to the laying of charges against Mr. Banks. We have been trying to get this information for days. The indication today is that Banks is still the pampered pet of the government.


Hon. Lionel Chevrier (Minister of Justice):: Mr. Speaker, I have stated in the house that this matter has been, and is, under active consideration. I know and believe that because of the circumstances the house will take my word. I must add that under my responsibilities as Minister of Justice, further comment on my part at the moment would not be in the public interest.


Horace Andrew (Bud) Olson: A supplementary question. I should like to ask the Minister of Justice whether he would give an undertaking to the house that tonight when his estimates are called he will come prepared to give an answer to this question, and also
[Mr. Pickersgill.l

give a report respecting the investigation into the circumstances surrounding the beatings suffered by several seamen aboard a train earlier this week, so that we do not have any more of these answers where the minister says "I can say no more at this time" after in fact he has said nothing.


Lionel Chevrier: In answer to that question I must say that so far as the beatings on the train are concerned I have inquired from the Royal Canadian Mounted Police, who tell me that this is a matter of assault, that it has nothing to do with the strike, and that the matter is under investigation by the Ontario provincial police. I am also informed by the R.C.M.P. that the individual who was assaulted refuses to make any statement in connection with the matter. So far as the other aspect of the matter is concerned-


Thomas Clement (Tommy) Douglas: They are all scared to make a statement.


Lionel Chevrier: -I am afraid my position tonight will be the same as it is now with regard to the matter asked by my hon. friend. I will be glad to deal with it as far as I can, but I will go no further.



ACTION TAKEN WITH RESPECT TO RISING PRICES

[Stage Direction]
On the orders of the day:
Thomas Clement (Tommy) Douglas: May I direct a question to the Prime Minister. In view of the fact that the price of sugar has doubled in the past year and has now reached a 43 year record, I wonder if the Prime Minister has seen a statement by Mr. A. E. Beeby of the Salada Foods Company that there is no world shortage of sugar, and that these skyrocketing prices are due entirely to speculators who are making a killing at the expense of the consuming public. I should like to inquire what action the government proposes to take in order to make sure the public is not being exploited by the sugar monopolies in this country.


Lionel Chevrier: I anticipated a question of this nature, and I asked the director of research to supply me with an answer. I have this reply with respect to the present situation. Refiners' prices at Montreal yesterday, October 24, reached $18.30 per 100 pounds, having increased steadily from $10.60 on August 27, the lowest price reached following the price rise in May.
Available information on the raw sugar situation indicates that because of increasing world consumption and because of production

difficulties there is unlikely to be any immediate improvement in the supply position, and with this persisting condition the world price of raw sugar will probably continue at high levels. The increase in Canadian sugar prices is attributable to the increase in world raw sugar prices. In view of commonwealth arrangements, however, no physical shortage of sugar in Canada is anticipated.
With respect to the last part of the question, I can only direct the hon. member's attention to what the Prime Minister said in this house on May 31 and to what I have said in reply to questions from time to time, namely, that there is a constitutional aspect to the matter; it is the provinces, not this parliament, which have jurisdiction over prices in peacetime and if any law or regulation were to be made limiting prices it would have to be made by the provinces. If hon. members feel that action of this kind is necessary in the present circumstances to protect consumers, their pleas, observations and requests in connection with the matter should be addressed to the provincial governments, which alone have the power to set limits on prices.


Thomas Clement (Tommy) Douglas: Could I ask the minister whether it is not the case that price fixing by monopolies and cartels does come under the control of his department? Further, is the situation being carefully watched, in view of the fact that not only is the price of imported sugar being increased but the price of domestically produced sugar is being increased, and it is being sold at a price to which is being added both the freight rates and the world price increase. Is the minister's staff in the restrictive trades practices branch fully aware of this situation, and are they carrying on a thorough investigation into it?


Lionel Chevrier: The answer to the first part of the question is yes. It is the responsibility of the director to see that no monopoly exists and having regard to this, the director, through the officers of the department, has already prosecuted three if not four companies. A report of those prosecutions which were successful, was made to the house on an earlier occasion. As far as western Canada is concerned there has been a prosecution which was not successful.
The answer to the hon. gentleman's second question is that the director is keeping the matter under close surveillance and if he becomes aware of any circumstances which warrant prosecution he will act accordingly.


Thomas Clement (Tommy) Douglas: Would the hon. gentleman consider bringing in amendments to the Combines Investigation Act to increase the
28902-5-255J
Inquiries of the Ministry fines which must be imposed? My impression is that the fines imposed on the sugar companies after the last convictions obtained by the department were so small that they amounted to only a fraction of a cent a pound on the exploitation which was perpetrated on the public.


Lionel Chevrier: I understand that under the act as it now stands the amount of the fine is unlimited. However, I can tell the hon. member that there is a departmental committee presently studying the question of possible amendments to the Combines Investigation Act. I have not seen the final report, but when it is forthcoming I will give it consideration in order to see whether legislation should be brought before this house.


Mr. W. H. Jorgenson (Provencher):: Would the government give consideration to passing legislation enabling them to set up a trusteeship over the sugar refiners so as to avoid this speculation? I wonder also whether the government has given consideration to enabling the sugar beet growers of Canada to obtain a larger share of the market, thereby preventing these violent fluctuations in price.


Lionel Chevrier: Mr. Speaker, I do not think the first part of the hon. member's question requires any reply. As to the second part, I cannot add anything more to what I have already said.


Mr. Gilles Gregoire (Lapointe):: Mr. Speaker, I have a supplementary question-


Prosper Boulanger: Mr. Speaker, I would like to direct a question-


Mr. Speaker:: Order. I understand the hon. member for Lapointe wishes to ask a supplementary question?


Gilles Grégoire: Yes, Mr. Speaker.
Under the existing circumstances, does the Minister of Justice intend to suggest that Canada pull away from the satellite course it has been following around London and the London sugar exchange, so that our country would have a free hand to look for alternative sugar markets and thus avoid increases in the price of sugar similar to the ones we are experiencing at present?


Lionel Chevrier: Mr. Speaker, under the provisions of the act, as adopted by parliament, any action in that field is the responsibility of the director of research. Besides, as I have often stated, if the director feels that there is a combine between various companies, he is the one who can institute proceedings against them.

Inquiries of the Ministry


Raymond Langlois: Mr. Speaker, may I put the question to the Minister of Justice in a different way. Does the government intend to stop the racketeers in the sugar business, or does it not?


Mr. Speaker:: Are there any more supplementary questions on the question of sugar?


Mr. Reid Scoff (Danforfh):: A supplementary question, Mr. Speaker. I wonder whether the Minister of Justice, in his endeavours to deal with this very difficult problem, would mind directing the attention of this committee to the situation in England, where the institution of a sugar board and the use of long term contracts have enabled the government to protect the people of Britain from this type of price manipulation rather than worrying about trying to catch up with the offenders, which is often very difficult to do.


Lionel Chevrier: I can assure my hon. friend that the director of research has already given consideration to that matter, and I believe he has even gone to the United Kingdom to ascertain what the situation is there in order to see if advantage could not be taken of the experience in that country.


John George Diefenbaker: Mr. Speaker, with further reference to the sugar question may I say that I brought the situation to the attention of the minister on May 27 this year, as found at page 286 of Hansard. I should like to ask him this question. What has been found to be the situation regarding the some 400 million pounds of sugar that were in storage which, as a result of the tremendous increase in price, brought to certain wholesalers or those operating refineries a windfall of a minimum of $6 million? Does the minister not feel that the raising of the price by these people who had sugar in storage, and doing so uniformly, constitutes an offence?


Lionel Chevrier: Mr. Speaker, I remember the question which the right hon. gentleman put to me at that time, to which I made a reply. Unfortunately I cannot remember the details of the reply, but I do remember that the information I received from the director of research was that the matter was being given consideration and that if any charge was indicated in the light of what the hon. gentleman had stated, action would be taken. My recollection was that no action was taken.
I am not in a position to substantiate the preamble to the hon. member's question. He has made that statement. It was studied by those who are in authority, but I am not in a position to accept it from the point of view of its reliability.


John George Diefenbaker: Mr. Speaker, I ask the hon. gentleman then to get figures showing the amount of sugar in storage, which I have said was some 400 million pounds. The rise in the price of sugar of 5, 6, 7, 8 or 9 cents a pound brought a tremendous windfall to a few people. Is it not a fact that it is an offence when any person agrees with others to raise the price uniformly while they have in their possession at the time a surplus of a product? Is that not an offence?


Lionel Chevrier: Mr. Speaker, there is a question of law involved in what my hon. friend has stated. As I indicated, I cannot add anything to what I have already said; but I would point this out to the house. Notwithstanding the many questions that are being posed now, the house knows that tonight at seven o'clock I am going on with the estimates of the Department of Justice, and I will welcome any of these questions. While they should be allowed on orders of the day, surely there is some limit to the extent to which they should be posed, and I will be ready to deal with them tonight.


Frank Howard: A supplementary question.


Mr. Speaker:: Is it on the question of sugar again? We have had a great many questions. The hon. member has heard the explanation of the Minister of Justice, and I wonder whether further questions on this matter could not be postponed until seven o'clock tonight.


Frank Howard: What I wish to ask the minister is a little different. Is it not a fact that all the words that have poured out of him are merely to cover up the fact that the government intends to do absolutely nothing?


Some hon. Members:: Rubbish.


Lionel Chevrier: I cannot allow the statement to go unchallenged that absolutely nothing has been done when three, if not four, corporations have been prosecuted successfully by the director of research.


John George Diefenbaker: Not for these offences.


Mr. Speaker:: Order. I feel we are entering upon a debate. We have had a very full discussion of the matter, and an opportunity will be provided at seven o'clock to pursue it further.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Hon. D. S. Harkness (Calgary North):: Air. Speaker, I should like to direct a question to the Minister of National Defence. Has the

government made a decision to reduce Canada's naval contribution to NATO?


Hon. Paul Hellyer (Minister of National Defence):: No, Mr. Speaker.


Douglas Scott Harkness: A supplementary question. Has the government plans which will enable the ships now wearing out and which during the course of the next five or six years will have to be retired to be replaced in time so that we can continue to meet our commitment to NATO?


Paul Theodore Hellyer: Mr. Speaker, we have the ships to meet the commitment we now have. We are urgently working on plans in respect of any future commitments for a later time.


Douglas Scott Harkness: A further supplementary question. Is the minister not aware that it takes several years to initiate and carry to completion a naval program, and that if such a program is not started immediately there will be no possibility of our continuing to provide the number of ships we have been providing?


Paul Theodore Hellyer: I am very much aware of that, and I am also very much aware of the fact that if you initiate the wrong program it takes quite a few years to undo it.


Some hon. Members:: How about the Arrow?



COMMITTEE CONSIDERATION OF PROGRAM OF AIR BASE ABANDONMENT

[Stage Direction]
On the orders of the day:
Hon. J. A . MacLean (Queens): I should like to ask the Minister of National Defence if he can assure the house that no final decision will be taken on the proposed drastic program of abandoning defence bases as part of the minister's current austerity program until the special committee on defence has had an opportunity of examining the whole matter?
Paul Theodore Hellyer: Mr. Speaker, there are a great many proposals involved in our current review. I am sure that most of them will not be finalized in any respect before the committee has had a chance to make its final report later in the session.


Mr. MacLean (Queens):: May I ask a supplementary question. Can the minister assure the house that the government is not contemplating the closing down of the R.C.A.F. station at Summerside?


Paul Theodore Hellyer: I cannot give a categorical assurance. I do fully appreciate the views of my hon. friend and many other hon. gentlemen, including particularly the Solicitor General, in respect of this proposition, which is
Inquiries of the Ministry not one that the government has put forward but which has come from another source.


Hon. Gordon Churchill (Winnipeg South Centre):: May I ask a supplementary question of the minister. What other groups have made a proposal that air bases be discontinued in this country? Does this come from foreign sources? Would the minister please advise the house?


Paul Theodore Hellyer: I think it comes from the opposition, Mr. Speaker.


John George Diefenbaker: That is a complete falsehood, and the minister knows it.



PENITENTIARIES


[Stage Direction]
On the orders of the day:
Mr. Jean L. Rochon (Laval):: Mr. Speaker, I should like to put a question to the Minister of Public Works.
Would he have any comments on the press reports, especially in the Montreal newspapers, to the effect that the prisoners at the St. Vincent de Paul penitentiary complain about the delays in the work now under way?


Jean-Paul Deschatelets: Mr. Speaker, I read various press reports to that effect. The architects of the Department of Public Works have kept a close watch on this work since its inception, and I never heard any report to the effect that delays were occurring.
I understand that this reported complaint about the slowness of the work stems from comments obtained from some inmates. I realize that works on such a large scale in a penitentiary such as St. Vincent de Paul, would be carried out at a slower pace than those of an ordinary building.
In any event, this morning I asked the inspectors of the public works department to send me a report in that respect. Furthermore, we have contacted the warden of the penitentiary and a visit has been scheduled for next Wednesday when, with various architects of the department, we shall go and find out for ourselves.



CANADIAN NATIONAL RAILWAYS


[Stage Direction]
On the orders of the day:
Mr. Gerard Laprise (Chapleau):: Mr. Speaker, my question is directed to the Minister of Transport.

Inquiries of the Ministry
Could the minister tell us whether it is the C.N.R. policy to supply some private trucking businesses with its own trailers for highway transportation, as was the case recently, which is quite unfair?


Mr. Speaker:: This is a question for the order paper.



TRANSPORT


[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Port Arthur):: Mr. Speaker, I should like to ask the Minister of Transport a question with reference to an understanding I have that he is meeting today with a delegation from the U.S.S.R. regarding the transportation of grain to Russia. I should like to ask him whether he or his officials have under consideration any proposals that would lead to ocean-going vessels, Russian or chartered, going directly to the lakehead for the rest of the shipping season in order to carry grain and relieve the congestion on the rails and amongst lake traffic.


Hon. G. J. Mcllraiih (Minister of Transport):: No, Mr. Speaker, no such program is under consideration at the moment. I do not agree with the latter part of the hon. member's assertion that it would in any way increase the total amount of shipments.



WESTERN ONTARIO


[Stage Direction]
On the orders of the day:
Mr. Eric A. Winkler (Grey-Bruce):: Mr. Speaker, I have a question for the Minister of Transport. Because of the implications and the importance to the economy of western Ontario, will the minister assure the house that there will be no further curtailment of rail service in that area?


George James McIlraith: Mr. Speaker, I could hardly give the assurance in that form, but I will immediately look into the whole matter and find out from the railways and the board of transport commissioners what the situation is. I am aware of the concern this matter raises throughout many of the municipalities in western Ontario, and I will give the matter very close attention.



INQUIRIES OF THE MINISTRY

[Stage Direction]
On the orders of the day:
Mr. Auguste Choquette (Lotbiniere):: Mr. Speaker, I should like to put a light question to the Minister of Justice.

Could he tell us if the fact, for a Liberal member, of attending a Social Credit dinner without an official invitation is considered an offence which should be referred to the R.C.M.P.?


Marcel Joseph Aimé Lambert: This is ridiculous.

On the orders of the day:


Raymond Langlois: I have a question to direct to the Minister of Trade and Commerce. Does the Minister of Trade and Commerce have before him consideration of the possibility of exchanging Canadian wheat directly for Cuban sugar instead of letting the Russians do it?


Some hon. Members:: Order paper.



REDISTRIBUTION


[Stage Direction]
On the orders of the day:
Mr. Andrew Brewin (Greenwood):: Mr. Speaker, my question is for the Secretary of State. In the light of the statement in the speech from the throne that redistribution of electoral districts is overdue and this house will be asked to authorize the establishment of a commission to undertake this important task, will the Secretary of State tell the house what steps are being taken to implement this undertaking so the proposed redistribution might be implemented before the next general election?


John Whitney Pickersgill: I welcome this particular question because I had hoped, and I still hope, before the end of this week to initiate discussions with hon. gentlemen on the other side of the house with a view to ascertaining the best way of proceeding with this legislation. I feel we all have a duty to co-operate in this matter because it is the constitutional obligation of parliament to get through with it at this session.



HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, may I direct a question to the Minister of National Health and Welfare. In view of the facts about conditions under which a great many old people in Canada live which are being brought out by a committee of the other place, can the minister say whether the government will

speed up its attack on the problems of the aged such as security, housing and health, and let this house deal with these matters at an early date?


Hon. Judy V. LaMarsh (Minister of National Health and Welfare):: Mr. Speaker, I do not fully appreciate the import of the hon. gentleman's question. We have, as all hon. members are well aware, taken the first step toward alleviating some of the difficulties of the aged by increasing the old age security pension to $75, which increase goes out for the first time this month. I am not certain to what other legislation my hon. friend refers, unless it is the Canada pension plan.


Stanley Howard Knowles: May I then ask a supplementary question. Will the minister take a look at the report of a speech made to the committee of the other place by Professor John Morgan of Toronto? Since she has referred to the Canada pension plan, can she say whether, in view of the changes to be made in connection with the plan, she will ask the house to go ahead with the resolution now on the order paper, or is she going to place another one on the order paper, and if so when?


Julia Verlyn (Judy) LaMarsh: It is obvious, Mr. Speaker, that the resolution now on the order paper cannot be proceeded with in its exact form since it does include a reference to the $10 increase. However, I should like to assure my hon. friend and all members of the house that the government still has the interest it always had in the Canada pension plan and intends to proceed, in co-operation with the provinces, with discussions in November at the provincial conference.


Hon. J. W. Monfeith (Perth):: May I ask
the minister if she has received representations from individuals or organizations, primarily organizations representing the blind and the disabled, requesting a similar $10 increase in pension to that received by the aged?


Julia Verlyn (Judy) LaMarsh: I have had representations from the blind and disabled from time to time since I assumed the ministry, but not since the increase in old age pensions.


Hon. Theogene Ricard (Si. Hyacinths -Bagoi):: A supplementary question, Mr. Speaker. Would the minister inquire as to whether it is true that the social allowances commission of Quebec would reduce the supplementary assistance granted to some pensioners, because of the $10 increase in old age pensions, as is reported in a letter signed
Inquiries of the Ministry by the said commission and published in the newspaper Montreal Matin on October 24, 1963?


Julia Verlyn (Judy) LaMarsh: Mr. Speaker, if I understood it correctly, what my hon. friend is asking about is a reduction in family allowances. As hon. members are aware, there has been no reduction in family allowances.


Hon. Paul Mariineau (Ponliac-Temiscamin-gue):: Mr. Speaker, I think the minister has misunderstood the question. The question of the hon. member was a request for an investigation into the alleged practice by the social allowances commission of Quebec to reduce by $10 the supplementary pension paid to certain pensioners by reason of the rise of $10 in the universal old age pension.


Julia Verlyn (Judy) LaMarsh: I have not heard of this allegation before, but from what my hon. friend says it would appear to me to be a matter of provincial rights. However, I will ascertain whether or not there is any federal responsibility.



SKIM MILK


[Stage Direction]
On the orders of the day:
Mr. Colin Cameron (Nanaimc-Cowichan-The Islands):: Mr. Speaker, I have a question for the Minister of National Health and Welfare based on a report in the newspapers that part of the aid Canada is providing to some of the devastated areas in the world is in the form of dried milk. In view of the recent report of the minister's department of the increase by a factor, in some instances of four and five, in the incidence of strontium 90 in milk, has her department been called in to examine these shipments before they are sent to these parts of the world?
Hen. Judy V. LaMarsh (Minister of National Health and Welfare): I am not sure of that, Mr. Speaker. I know that my department was brought into the picture, by the United Nations authorities, in conjunction with departments of agriculture and external affairs with respect to this matter. I am not certain whether any particular check was taken on it. I do not know how long this powdered milk has been in existence, but I would be glad to find out for my hon. friend.



UNITED NATIONS


[Stage Direction]
On the orders of the day:
Hon. Paul Martin (Secretary of Stale for External Affairs):: Mr. Speaker, yesterday a question was addressed by the hon. member

Inquiries of the Ministry for Queens (Mr. Macquarrie) to the Prime Minister with regard to a reported resolution of the non-aligned members of the Geneva disarmament committee to extend the nuclear test ban to its completion by covering underground tests. He asked what was the attitude of the Canadian government toward this resolution.
The resolution, which has not yet been circulated, is designed to encourage the nuclear powers to renew their efforts to reach a mutually acceptable agreement on a comprehensive test ban treaty. The Canadian delegation is now in consultation with all of the sponsors of the proposed resolution in the hope that it can be a resolution that will be sponsored by all the 18 members of the disarmament committee, who have been parties to the discussions in Geneva.



PRIVILEGE ACCORDED PRIME MINISTER IN MAKING SPEECH

[Stage Direction]
On the orders of the day:
Gilles Grégoire: Mr. Speaker, I have a question for the Prime Minister. Having followed some of the debates in the United Nations, I had occasion to observe that when the delegates are addressed by a head of state, the latter is allowed to have his seat placed onto the platform. Marshal Tito availed himself this week of that privilege.
However, when the Prime Minister of Canada spoke recently at the United Nations he was not granted the same courtesy. Could he explain why, on that occasion, the Prime Minister of Canada did not receive the same treatment as the other heads of state?


Right Hon. L. B. Pearson (Prime Minister):: Yes, Mr. Speaker, this is a privilege that is traditionally reserved at the United Nations for heads of state. I am not yet, Mr. Speaker, a head of state; but I was approached by the secretary general who asked me whether, in view of the fact that I had been president of the general assembly and even though I was only a head of government, I would accept this particular courtesy. However, I preferred to speak in the ordinary way, as head of a delegation.


Some hon. Members:: Hear, hear. [Translation]


Gilles Grégoire: I have a supplementary question, Mr. Speaker.
Could the Prime Minister tell us who, at the present time, is the Canadian head of state, and how often did he enjoy the special


privilege which is granted to heads of state when he had occasion to speak at the United Nations? Besides, could he inform us what Canadian representative is entitled to that privilege?


Louis-Joseph Pigeon: Mr. Kennedy.


Lester Bowles Pearson: Mr. Speaker, the head of state in Canada is the Governor General. [Translation]


Gilles Grégoire: Mr. Speaker, I have a supplementary question-


Mr. Speaker:: If it is really important and urgent, but-


Gilles Grégoire: I feel it is important, as Canada is a member of the United Nations and the Canadian delegates to the United Nations would like to see Canada on an equal footing with the other countries of the world.
Moreover, we think that when the Prime Minister of Canada delivers a speech at the United Nations he should get the same treatment and be entitled to the same privileges as those that are given to the other heads of state.


Some hon. Members:: Order.


Lionel Chevrier: He is doing exactly the same thing you have been doing all morning. Don't complain about it; that is what you have been doing all morning.


Mr. Speaker:: Order. This is not a matter that should be discussed on orders of the day.


Mr. Gerard Girouard (Labelle):: Mr. Speaker, I have a question for the Secretary of State for External Affairs.
Can the minister tell the house if the privilege referred to by the hon. member for Lapointe is granted to the British Prime Minister or to the Queen only, when Great Britain speaks at the United Nations?


Paul Joseph James Martin: Mr. Speaker, I think the Prime Minister has answered this question.


An hon. Member:: No, not that one.


Gérard Girouard: A supplementary question, Mr. Speaker. The Prime Minister answered from the standpoint of Canada, but my question refers to Great Britain itself.


Gilles Grégoire: Mr. Speaker, a supplementary question-


Mr. Speaker:: I was about to rule that question out of order. Consequently there is no supplementary.


Gilles Grégoire: Mr. Speaker, may I this time direct the question to the Prime Minister? [Text]


Mr. Speaker:: I am sorry, but the hon. member must know that when a decision is given by the Chair it should, I hope, be accepted by the house.


Gilles Grégoire: Mr. Speaker, may I put a
question to the Prime Minister?
Does the Prime Minister intend to have the necessary amendments made to the Statutes of Canada so that the head of state recognized by the United Nations will be the man who will speak on behalf of the Canadian government and not a person-


Mr. Speaker:: Order. I have already ruled that this question is out of order, and it is doubly out of order now.



NORTHERN AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. Erik Nielsen (Yukon):: Mr. Speaker, I have a very urgent question for the Minister of National Defence, the answer to which will have very serious and far reaching economic implications in the city of Whitehorse and the Yukon generally. In view of widespread and persistent rumours in Whitehorse and elsewhere in the Yukon to the effect that the Department of National Defence is transferring its complete responsibility for the maintenance of the Alaska highway system to the government of the Yukon Territory, can the minister inform the house whether the Department of National Defence will be relinquishing these maintenance responsibilities, and make a statement as to the details thereof?


Paul Theodore Hellyer: Mr. Speaker, I should like to thank the hon. member for giving me notice of his intention to ask this question, and in reply may I say that the government has decided that responsibility for the northwest highway system should be transferred from the Department of National Defence to the Department of Public Works next spring.
Inquiries of the Ministry
As hon. members know, this highway was constructed by the United States government during world war II as a military requirement, with the Canadian army taking control of that section of the highway in Canadian territory on April 1, 1946. Today there is more commercial than military significance for the maintenance of the highway, and for this reason the decision has been made.
Arrangements between the two departments for the hand-over are now being made, and a joint party will be proceeding to Whitehorse shortly to work out the details.


Erik Nielsen: As a supplementary question, does the minister's reply mean that a phased withdrawal of the several hundred army personnel in Whitehorse and the Yukon will take place, and could he indicate the extent of such withdrawal?


Paul Theodore Hellyer: Yes, eventually all army personnel will be withdrawn, but the timing of such withdrawal will have to be worked out with the Department of Public Works.


Erik Nielsen: I have one further supplementary question. Will the civilian labour force maintaining the highway, some 2,400 workers, be affected, and if so to what extent?


Paul Theodore Hellyer: I would not expect so, but the actual details will depend on the Department of Public Works as it takes over.



COLUMBIA RIVER


[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kooienay West):: Mr. Speaker, after 10 days of most unusual and trying restraint, I wish to direct a question to the Secretary of State for External Affairs. My question is based on the fact that I have 2,000 constituents who have been kept in a state of suspense for over three years as to their future way of life. Can the minister inform the house what is the cause for the continued delay in the resumption of negotiations on the Columbia river, and give us some details as to their resumption?


Paul Joseph James Martin: Mr. Speaker, there is no
delay whatsoever in the negotiations. These negotiations are under way at this very moment on the northwest Pacific coast, where two working groups set up by the negotiating teams from Canada and the United States are meeting to analyse the very vital factors involved in the question of the desirable price for the sale of the downstream benefits. These working groups are meeting continuously to prepare for the negotiating teams

Inquiries of the Ministry who will meet formally again in Ottawa or Washington. My hon. friend may be sure that there has been no delay, and that just as quickly as possible we will not only relieve the suspense of the hon. gentleman's constituents but the suspense of the hon. gentleman himself.


Herbert Wilfred Herridge: A supplementary question, Mr. Speaker. Does the minister know that the minister of lands and forests in British Columbia has given, as one reason for the delay, the failure of possible purchasers of the power, be they private, co-operative or otherwise, to reach any agreement as to how they will proceed and as to price.


Paul Joseph James Martin: Mr. Speaker, the question of price is very important. As my hon. friend knows, we have stated repeatedly that an essential condition in the negotiations is to make sure that we get from the United States an assurance as to a price that will make this project self liquidating; and until we get that assurance we do not propose to agree to the sale of the downstream benefits. My hon. friend, I am sure, would be among the first to congratulate the government for the stand it is now taking.


Herbert Wilfred Herridge: If that occurs.


Mr. D. V. Pugh (Okanagan Boundary):: Mr. Speaker, I have a further supplementary question for the minister. Has the province of British Columbia a negotiating team as well? The minister mentioned the two governments, the federal government and the government of the United States. Is Mr. Bennett being consulted, and has he a consultation team working with the other two governments?


Paul Joseph James Martin: Mr. Speaker, the government of British Columbia is the owner of the resource, and discussions particularly having to do with price involve the closest consultation with the government of British Columbia. For my hon. friend's benefit and the information of the house, I hope to be meeting at noon with a representative of British Columbia-


An hon. Member:: At noon?


Paul Joseph James Martin: At one o'clock I hope to be meeting with a representative of British Columbia. I may say that the government of British Columbia seems to be satisfied with the way the present government of Canada is handling this matter.



HALIFAX


[Stage Direction]
On the orders of the day:
Mr. Gerald A. Regan (Halifax):: Mr. Speaker, I should like to direct a question
[Mr. Martin (Essex East).)
to the Minister of Transport. Will the minister investigate the possibility of stationing several lake grain carriers in Halifax at the end of the lake shipping season, to be used for the storage of grain and thus supplementing the capacity of our grain elevator and enabling the port of Halifax to ship more grain this winter?


George James McIlraith: Yes, Mr. Speaker.



PARLIAMENT BUILDINGS


[Stage Direction]
On the orders of the day:
Mr. Jean Chretien (St. Maurice-Lafleche):: Mr. Speaker, I should like to direct a question to the Secretary of State.
In view of the lack of bilingual personnel in the parliament's constabulary force, which is to the detriment of the French speaking people visiting the parliament buildings, is it the intention of the internal economy commission to cope immediately with such a situation?


John Whitney Pickersgill: Well, sir, Your Honour has heard that question, and I am sure it will be considered.



INDUSTRY


[Stage Direction]
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 Industry. Has the minister consulted with the province of Manitoba in order to avoid costly duplication in setting up the Department of Industry?


Charles Mills (Bud) Drury: Mr. Speaker, I have had an exchange of correspondence with Premier Roblin.


Walter Gilbert Dinsdale: A supplementary question. Is the minister aware that the premier of Manitoba has made the comment that no such consultation has taken place?


Charles Mills (Bud) Drury: No, Mr. Speaker.



BRIDGES


[Stage Direction]
On the orders of the day:
Mr. Clement Vincent (Nicolei-Yamaska):: Mr. Speaker, I should like to direct a ques-

tion to the Minister of Transport. This question deals directly with the construction project of a bridge worth $30 million across the St. Lawrence, between Three Rivers and my constituency, the specifications of which had been approved at the beginning of March, this year.
Could the minister tell us whether there is any truth in the reports now appearing in our local press and heard among the people to the effect that federal government now objects to the plans and the construction site of the bridge on the river, when those plans were approved at the beginning of March and accepted by the Quebec premier, the Hon. Jean Lesage?


Mr. Speaker:: Order, please.


Clément Vincent: This is very important.


Mr. Speaker:: There is no doubt about the importance, but where is the urgency? Would the hon. member put this question on the order paper.


Clément Vincent: Mr. Speaker, may I put a question to the Minister of Transport?
Has the minister received a communication from the bridge corporation asking him to make representations to the government since the work is to be started very soon?


George James McIlraith: No, but I think I should add that one of the officials of the corporation was here yesterday, and I expect to see him again next week.



WHEAT-COMMODITIES TO BE TAKEN IN EXCHANGE FOR WHEAT

[Stage Direction]
On the orders of the day:
Raymond Langlois: Thank you, Mr. Speaker. I was getting a little tired of bouncing up and down trying to catch your eye for the last hour. I have a question to direct to the Minister of Agriculture, but in his absence I will direct it to his parliamentary secretary. Did Canada receive any commodities, apart from cash, in their wheat transaction with Russia, and, if so, what were these products?


Mr. B. S. Beer (Parliamentary Secretary to Minister of Agriculture):: I will be glad
to take this question as notice and bring it to the attention of the minister. I am sure an answer will be forthcoming immediately.
Inquiries of the Ministry POST OFFICE DEPARTMENT



INQUIRY AS TO AGREEMENT WITH CUBA

[Stage Direction]
On the orders of the day:
Louis-Joseph Pigeon: Mr. Speaker, may I direct to the Postmaster General a question of which I have given him notice?
Is there a bilateral postal agreement between Canada and the Cuban government? I intend also to ask a supplementary question.


Hon. Azellus Denis (Postmaster General):: Mr. Speaker, Cuba is a member of the Universal Postal Union.


Louis-Joseph Pigeon: What does the minister intend to do in view of the fact that the Cuban government has decided to seize all parcels addressed to hurricane victims in Cuba?


Azellus Denis: Mr. Speaker, it is obvious that the Post Office Department cannot intervene and give instructions to the Cuban government with regard to parcel post.


Louis-Joseph Pigeon: Does not the minister feel that the Cuban government is violating the international postal agreement?



IMMIGRATION


[Stage Direction]
On the orders of the day:
Mr.  A. B. Paiterson@Fraser Valley: should like to direct a question to the Minister of Citizenship and Immigration. Has the hon. gentleman received a communication protesting the manner and slowness with which members of the charter flight of the Fraser valley milk producers association, flight No. 371, Canadian Pacific Airlines, were cleared at Edmonton upon their return from Europe and, if so, is the matter being investigated?


Mr. Speaker:: Order. This is a question for the order paper.


Malcolm MacInnis: On a point of order, I would refer Your Honour to a question asked yesterday by the hon. member for St. John's West, which I think set a precedent which would permit any member to ask any question he wishes in this house. It was a question of no national importance, but it was asked by the hon. member for St. John's West and answered by the Minister of Citizenship and Immigration.


Mr. Speaker:: I am well aware of that question but, as I have said on previous occasions, it is difficult for the Chair to decide

Inquiries of the Ministry whether a question is in order until it has been asked and the Chair has heard it. That was the case with regard to the question asked by the hon. member for St. John's West. By the time the minister was on his feet answering, it seemed to me there would be a saving in time if the question were allowed. I certainly thought it should have been a question for the order paper.


Malcolm MacInnis: With all due respect to you, sir, the question asked by the hon. member for St. John's West was not one which should have needed a great deal of consideration before being ruled out of order. Questions asked on this side of the house are ruled out of order continually.


An hon. Member:: Don't show your ignorance.


Malcolm MacInnis: While I am on my feet, I wonder if the Secretary of State would take it upon himself to rise and repeat the remark which came just now from the other side of the house, from his direction. I do not say it was his remark.


John Whitney Pickersgill: On a question of privilege, the hon. member seems to have defective hearing as well as a defective knowledge of the rules, because I said nothing whatever.


Mr. Speaker:: Order. I do think this chit chat, if I can call it that, should be brought to an end. Members themselves have a certain responsibility for their conduct in this house. The Speaker does not want to be on his feet continually delivering lectures on procedure. A certain responsibility attaches to all members to conduct themselves in accordance with the standing orders. I suggest we leave it at that.


Malcolm MacInnis: On a question of privilege, the Secretary of State made reference to my hearing. I want to tell him that I in no way accused the Secretary of State of making the remark. The question of privilege he raises was certainly not a question of privilege because, in the first place, I did not indicate he had made the remark I overheard.



DELAY IN RECEIPT OF FRENCH &quot;HANSARD&quot; AND COMMITTEE REPORTS

[Stage Direction]
On the orders of the day:
Gilles Grégoire: Mr. Speaker, it happens sometimes that we, in this corner of the house, have questions to ask; however, we are always the last to be given the floor. You will note, Mr. Speaker, that from


the beginning a number of members of the other parties have asked questions. My question is directed to the Secretary of State.
On Monday, October 21, following a question I asked the Secretary of State pertaining to the delay in printing works for the French edition of Hansard and committee reports, the hon. gentleman answered that he would make inquiries and give the relevant information to the house. Can the Secretary of State give us that information now?


John Whitney Pickersgill: Not today, but I hope soon.



INCOME TAX ACT

[Stage Direction]
The house resumed, from Thursday, October 24, consideration of the motion of Mr. Gordon for second reading of Bill C-95, to amend the Income Tax Act.
Mr. Cote (Chicoutimi):: Mr. Speaker, may I call it one o'clock and continue my speech at 2.30 this afternoon?

At one o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 2.30 p.m. [Translation]
Maurice Côté: Mr. Speaker, when the discussion on Bill C-95 to amend the Income Tax Act was adjourned, I was expressing my amazement at some members of parliament who still believe that the off-the-beam monetary mechanism of our financial system could automatically adjust itself-


Reid Scott: On a point of order, Mr. Speaker, we are anxious to hear the hon. member's speech and the translation facilities are not working. Would you have the matter looked into?


Mr. Deputy Speaker:: Order. Maybe the hon. member could wait a moment-
The hon. member can now resume his remarks.


Maurice Côté: 
Mr. Deputy Speaker:: The hon. member for Pontiac-Temiscamingue (Mr. Martineau)-


Gilles Grégoire: On a point of order, Mr. Speaker. Since-


Mr. Deputy Speaker:: The hon. member for Lapointe (Mr. Gregoire) has the floor on a point of order.


Gilles Grégoire: Mr. Speaker, since-


Mr. Chapdelaine:: On a point of order, Mr. Speaker.


Mr. Deputy Speaker:: I have recognized the hon. member for Lapointe, who has the floor on a point of order.


Gilles Grégoire: Mr. Speaker, since you first gave the floor to a member of the New Democratic party and then to a Social Credit member belonging to the group of the hon. member for Red Deer (Mr. Thompson), do you not think that it would at least be in

Income Tax Act
order for you to go on to the last of the parties, as you call it, and to allow a Social Credit member belonging to the group of the hon. member for Villeneuve (Mr. Caouette) to speak also? I think that would be quite normal and in order.
Before giving the floor to a member of the New Democratic party, Mr. Speaker, you recognized a member of the Conservative party, then a member of the Liberal party and after that a member of the Social Credit party belonging to the Red Deer group, and now again to a Conservative, without letting a member of our group have the floor. That is the reason why I rise on a point of order, and I respectfully ask you to consider it.


Mr. Deputy Speaker:: I understand and appreciate the view expressed by the hon. member for Lapointe. On the other hand, the Chair tries, as a rule, to alternate the speakers, taking into consideration the number of members in each party. A member of the party which the hon. member for Lapointe represents will have the opportunity to speak when the hon. member for Pontiac-Temis-camingue has finished.


Paul Raymond Martineau: Mr. Speaker-


Gilles Grégoire: Mr. Speaker, I admit that you have a problem in alternating the speakers of the various parties. However, I feel that before recognizing the member of another party at this time, you should recognize the member of another but lesser party, before giving once more the floor to a member of the two more important ones numerically speaking and that a member of our group should be recognized, then a member of one of the larger parties.


Mr. Deputy Speaker:: Once again, I take note of the representations made by the hon. member for Lapointe, but he knows that, normally, the Speaker tries to be as fair as possible in alternating the speakers of the various parties when he recognizes a member. I do not think that the hon. member has reason to express a grievance because a member of his party is not recognized immediately.
As the hon. member for Lapointe knows, there is a procedure which must be followed in this house when an hon. member objects to the recognition of a member, as soon as he has been recognized by the Speaker.


Paul Raymond Martineau: Mr. Speaker, the hon. member for Lapointe should not worry, because I do not intend to take the whole afternoon.


Gilles Grégoire: Mr. Speaker, I raised the question only to safeguard the principle.


Paul Raymond Martineau: The hon. member for
Lapointe will have time to be heard and air his views, and everybody will be happy.

I wish to speak briefly on the legislation before the house. The minister has intimated that it has three main purposes. The first is to close certain loopholes in the existing act. The second is to provide an incentive to industry, particularly in those areas of slower growth. The third is changes in the nonresident withholding tax designed to reduce the cost of borrowing abroad and provide an incentive to the foreign owners of subsidiaries.
Now, Mr. Speaker, in so far as the first purpose of this act is concerned, that is to plug certain loopholes, the minister has admitted that at the most these are stopgap measures. The minister went on to say that when the royal commission on taxation reports it may be desirable to make extensive changes in the taxing statutes. I think it is almost inevitable that major changes in the whole taxation structure will follow the report of that commission. However, I am slightly perturbed, like a good many Canadians, and as the minister himself was last year, to find that the much needed reforms in our taxation structure are to be delayed, and that when some proposal is made to improve the taxing statutes the minister makes the classic reply that a commission is sitting and therefore these reforms cannot be considered.
I seriously ask myself if the economy can wait much longer for the structural changes that are required in our taxing system. Everyone admits that taxation in this country is reaching the proportions where it may be considered confiscatory, and that the level of taxation discourages initiative and, in particular, prevents the accumulation of investment capital.
It also prevents the proper expansion of purchasing power. As the minister knows, all these eventualities are most desirable, and he also knows that their achievement or implementation has become most urgent.
In regard to the reform of the tax structure itself and the basis of taxation, I read with some interest the views expressed by Mr. Frank S. Capon, vice president of Dupont of Canada Limited and a chartered accountant who is a confrere of the minister. He submitted an excellent brief to the commission, and the commission were so impressed with the views he expressed that they recalled him before them.
In essence, his views call for measures that will give Canadians a greater share in capital investment, and he says that unless this is

done we will rapidly become a socialist state to all intents and purposes. I am not at all sure that we have not reached the point of no return in that regard, but one ot his points which most impressed the commission was that taxation should be diverted away from corporations because corporations, not being persons, cannot really be taxed, and when a corporation is taxed in effect it is the shareholder, the taxpayer in his own right, who is being taxed.
Mr. Capon called for the complete elimination of the corporation tax. That is a radical proposal and I am not putting it forward, but I do call it to the attention of the minister. He also called for a lowering of the graduated rate of personal income tax, suggested that a stiffer tax be put on the undistributed earnings of companies, on tax dividends paid to foreign shareholders, and also proposed the elimination of the 20 per cent tax dividend credit.
This may seem quite strange to a lot of people because it has been argued here and elsewhere that in order to favour the accumulation of investment capital, the rebate on dividends for tax purposes should not be diminished or abolished but that it should be increased, and possibly doubled. That line of reasoning, of course, must be judged in the light that all corporate taxes would be abolished.
I am sure the minister and his department will take a very close look at these views. I am also sure that the minister himself, having in the past, by written word and verbally, championed the growth of Canadian industry and investment capital, can ill afford to let a situation continue and perpetuate itself, a situation that is definitely stifling the economic life of the country and which is defeating the very ends which the minister asserts are primary to his thinking, namely the development of more capital by Canadians so that Canadians can take back the control of their own industry and economy.
I submit that this cannot be done, and that even a start cannot be made on it, until the basic structural reforms of our tax system have been dealt with in an intelligent way, and until those other measures which have been proposed by the minister, and which are self defeating, have been carefully re-examined, reappraised and eliminated. The minister should not fear to backtrack again. He has done it previously; but if he refuses to act, or takes other measures that are foreign to what he says is his main objective, then he can only lose still further the confidence of the Canadian people. That is all I have to say about the general remarks made by the minister when introducing this bill.
Income Tax Act
The minister also spoke at some length about the incentives which are being provided to encourage industry to begin the manufacturing of new products in areas of slower growth. I think the ministry has now changed the description of those areas. At first they were supposed to be depressed areas, but because areas did not like to consider themselves depressed, and according to usual standards were far from distressed even though they had been singled out to share in this incentive tax kick, the government has now started to call them by some other name, such as slower growth areas or whatever it may be.
The minister said these incentives were considerable. I do not dispute that, but the fact remains that the method employed to provide these incentives is very wrong. The method of selection of the areas is discriminatory. The thinking behind the selection is ill conceived. It is contradictory because in some ways it defeats the purposes of the minister, and also because it does not take due account of other levels of government, provincial and municipal.
I do not want to repeat what was said by the hon. member for Wellington South in his very well thought out speech concerning the selection of areas of slower growth, but it seems to me the minister's proposals are lacking in one essential in that they do not provide enough safeguards to determine whether an industry that may avail itself of these incentives will really be manufacturing a new product or establishing a new business.
Before any company takes advantage of these incentives steps must be taken to determine whether it had already decided to begin the manufacture of the new product involved, and whether it had already chosen another place where its new operations would be carried out. Unless that is done then the government is not providing any new industry or new employment. All the government is doing is depriving some other area which no doubt had plans to receive the new industry that now will go elsewhere. The real loser is the Canadian taxpayer, and another loser is the principle of free enterprise in this country.
It is very difficult, Mr. Speaker, to justify, under our system of free enterprise, certain companies receiving decided tax advantages over certain others. Why should some companies in some areas, just because they happen to come under the formula devised by the officials of the government, obtain this tax holiday? That is something to which I think the minister should give serious consideration, because if he does not, his measures, instead of promoting economic growth may simply add to the confusion and will cause real hardship to industries which are already

Income Tax Act
established and are fighting hard to maintain their competitive position. There is no justification, unless all these precautions to which I have just referred, and those to which the hon. member for Wellington South (Mr. Hales), referred the other day, are taken. I hope that before this bill becomes the law of the land, before these incentives are administratively applied, all these safeguards will have been provided.
The minister has also proposed changes in the rates of withholding tax. He said that one must give priority in all our economic policies to measures that will bring our international transactions on current account into better balance, and he said the government is determined to do this. But I ask, are we going about it in the right way by doing these things? I ask this question because not very long ago the minister admitted that this was not something that could be done very easily, and it was not something that could be done by legislation. I think when he introduced his budget he said this objective of trying to win back our economy, and the desire to stop the inflow of foreign capital into this country, must be achieved without causing any harm to that inflow, which is beneficial to Canada. The minister admitted that it was beneficial.
We know, as well as the minister and the government, that the problem of our balance of payments is a very serious one indeed. The minister spoke about this in Washington. I was rather amazed to read some of the reports of his remarks. Perhaps they were off-the-cuff remarks that he made in Washington to newspapermen, but at one stage he is reported as having said:
It is easy to find general agreement on general approaches, but more difficult when specific proposals are offered.
That seems to be an admission on the part of the minister that he does not know what to do about this problem.


Mr. Gordon:: Oh, no.


Paul Raymond Martineau: The minister might scoff at this, but he did say it is difficult when specific proposals are offered. If that is what he said, I think it was because he had no specific proposals to offer at that particular time. I find this difficult to understand, coming from a minister who was so desirous of obtaining and preferring specific proposals for the betterment of our economy. I read-


Walter Lockhart Gordon: Mr. Speaker, I wonder if the hon. gentleman would permit a question. Would he not think that the proposal in regard to the automobile industry is a specific proposal?


Paul Raymond Martineau: That is certainly a specific proposal all right, but I must remind the

minister, as the hon. member for Digby-Annapolis-Kings (Mr. Nowlan) said so well today, that the proposal submitted this morning to the house was simply something taken off the shelf of the Conservative policy on these matters. It was a part of our policy.


Walter Lockhart Gordon: Oh, oh.


Paul Raymond Martineau: That is a fact, because the proposal was there. Everyone knows that; I am sure that even the minister knows it. In any event, I do not think the majority of the proposals he has made have won too much favour in Washington, where the minister went several times during the summer-and, I think, even since the house reconvened-[DOT] trying to sell those policies. He is having a fair amount of difficulty in this regard.
Mr. Speaker, getting back to the question of withholding taxes, I think the method proposed by the minister is definitely a retrograde, regressive step. There is no doubt about that at all. I think the whole thinking with regard to this withholding tax, as the hon. member for Edmonton West (Mr. Lambert) said yesterday, is simply putting the government in the position of holding a big stick over the heads of investors, the very people that the minister and the government want to lure into investing capital in Canadian industry. It is holding a big stick, and it is not providing an incentive.


Mr. Benson:: Mr. Speaker, I wonder if the hon. gentleman-


Paul Raymond Martineau: Mr. Speaker, I do not know whether the hon. member is rising to ask a question. If he is, I would ask him to wait until the end of my speech, and if there is any time left I will be very glad to answer questions. The arguments against the withholding tax are very numerous. Most of them have been mentioned, but it might be worth while to recapitulate the main objections to this tax. First of all, there is the question of administrative difficulty. It is impossible, because of the market practice, that prevails, to be sure of the identity of the buyers of shares. I know there have been changes in the act in this regard since the time the measure was first announced, but nevertheless the administrative difficulties remain enormous. If that measure is ever applied, it will seriously interfere with the free play of market forces, the buying and selling of shares on the open market. If the minister wants to encourage the growth of investment capital in this country, I do not think he should contemplate taking such a step, the consequences of which may be very serious for our economy and for the development of those industries that we consider vital to our future development.

Another reason for my finding this tax obnoxious is that it imposes penalties on the foreign investor and does not provide any real incentive to the Canadian investor; in other words, it penalizes a foreign investor who wants to buy Canadian shares, for no reason at all except that he happens to be a non-resident. That does not seem to me to be a reason that stands up. Canadians are free to purchase elsewhere in other markets; that is their business. Other ministers have stated that such investment is desirable, and the Secretary of State for External Affairs (Mr. Martin) stated not very long ago in Miami, Florida, that there was a great need in Canada for foreign capital, and foreign capital was welcomed here. If the government is to be consistent, surely it should not penalize those people whose money we want to lure into this country. I just cannot understand that approach to this problem. Even if one agrees with the objectives pursued by the minister, the methods employed are wrong. I would like the enumerate some of my reasons for saying this. Instead of holding a

I think this was the expression used by the hon. member for Edmonton West-big stick over the heads of foreign-owned companies, he should use these tax carrots to make more Canadian capital available for investment. For example, the minister could encourage direct investment in Canada by Canadian investors. It seems to me there is a very obvious way in which that could be done; that is, by simply increasing the exemption granted on dividends of Canadian corporations.
Many people, among whom are the most informed financial critics in this country, have asked that this 20 per cent rebate on the dividends of Canadian corporations be at least doubled. If that were done I think you would have a great flurry of new investment in Canadian equity, and by the same token you would be providing for Canadian industry that solid basis of cumulative capital which it needs. If the government and the minister do not give to the investors of Canada those means to acquire that capital, how are we ever going to have the capital which we need when at the same time the minister discourages foreign investors from
placing their funds in Canadian equity?
It seems to me there is some contradiction in the thinking of the minister, and perhaps his thinking has been compartmented into different sections. For instance, certain consultants might have drafted some measures- perhaps the withholding tax is one-and then another group drafted other measures which were entirely contradictory, and for some reason which I still cannot figure out the
Income Tax Act
minister accepted both. It is like a judge sitting on a case who judges both for the prosecution and for the defence: it just does not seem to make sense. That is why the business community has been so disillusioned by the present administration and the financial proposals for growth and progress placed before parliament by the minister, who belongs to that community. If anyone belongs to it he does. The only thing I can see is that he delegated his authority to others who followed different philosophies, and were proposing and probably seeking objectives which were contradictory one to another.
Regardless of that, Mr. Speaker, I think there is still time for the minister to take a sober look at all these proposals and withdraw bravely and courageously-if he can do it; he has done it before-those things which are harmful to our economy. If the minister is really serious about the objectives which he has placed before the house, and on which he spoke so feelingly in Hamilton this week, he should get all those things together and eliminate those which do not enter into his principal objectives, leave them aside and start anew. As I said before, that is the only way in which the minister might regain-I know it will be a difficult process-some confidence among the financial and business community of this country.
The withholding tax is also objectionable because the methods employed certainly smack, in some way anyway, of economic nationalism. When I say that, I do not say it very lightly. If they do not smack of economic nationalism, it cannot be denied that they have been interpreted as such by people across the border and by people who are in the know as far as financial matters are concerned. For instance, we have a declaration of statement by Robert Roosa, with whom I know the minister has conferred. He is the under secretary af the treasury in the United States and he commented, with apparent approval, on a report appearing in some United States papers to the effect that the United States is perturbed by Canada's curbs and signs of continuing trends to economic nationalism. These are some of the objections which I see in the present bill and to the withholding tax.
As I said before, the minister stated when he brought down his budget, in regard to winning back autonomy, and so on, that the solution is not one for legislation but for voluntary action. He said that the growing partnership between Canadians and investors abroad is the best way of strengthening harmonious relations with foreign capital which it is our object to preserve. So here we have the minister now introducing legislation,

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when in his budget speech he said that legislation to settle or to solve this* particular difficulty was not the proper approach. So again, Mr. Speaker, you see a quite glaring contradiction in the thinking and the methods employed by the minister. All these measures have contributed to blurring our image abroad; there is no doubt about that at all. It is too bad to have to say it, but it seems to me that it has had that effect and it is going to take an awful lot of tactful handling, smooth diplomacy and a lot of patient negotiation by specialists and officials to bring back a situation even anywhere approaching that which existed before June 13 last.
In summary, then, Mr. Speaker, these measures, especially the proposal with regard to the withholding tax on dividends, discourages the formation of equity capital and has an effect which could easily spell a return to tight money, higher interest rates, less investment, less capital, and therefore less expansion, capital expenditure, and so on, leading to a general tightening up of our system. I do not think the minister wants that. In fact, I am sure he does not, and I do not think the government wants it either. But we must not allow the wrong measures, perhaps taken in good faith, to bring about that result.
In conclusion, I urge upon the minister to take a very close look again at these measures, fearlessly to use the scissors wherever they should be used, and to come out with a good constructive policy for the betterment of Canadians, for the encouragement of the formation of investment capital which we need, as well as assurances to foreign capital that it will be treated as a friend-which it is, because it contributes in a vital way to the development of our own resources and higher standards of living. I am convinced that the minister in his inner thinking agrees with what I say. If he does agree he may still feel that he has done enough withdrawals and cannot afford to make any more. But I think that is the wrong approach, and I am sure he will agree. Let him take his courage in his hands, cut out these unfavourable proposals he is making, and go ahead and help Canadians to achieve that better life of which he was such an ardent protagonist when he sat on this side of the house.


Edgar John Benson: Mr. Speaker, would the hon. member permit a question?


Mr. Deputy Speaker:: Is the hon. member rising to ask the hon. member a question?


Edgar John Benson: Yes, Mr. Speaker. The hon. member stated that the proposal of the government which involves both increases and decreases in the withholding tax designed to

encourage the sale of shares of foreign-owned companies in Canada is a regressive step. Does that mean that he thinks the increase in withholding tax by the previous government from 5 per cent to 15 per cent in 1960 was a regressive step?


Paul Raymond Martineau: Mr. Speaker, we are dealing with the situation now, in 1963. The measures proposed by the minister and the government with regard to these withholding taxes, under the particular circumstances in which we find ourselves today, are definitely against the interests of Canadians generally and the growth of our economy, for the very reason I mentioned in the course of my speech.


Mr. Gray:: Would the hon. member for Pontiac-Temiscamingue permit a question? He indicated that the policy announced today had been Conservative policy. If it was in fact Conservative policy, why did the government which he supported apply it last year only to transmissions and certain engine parts instead of to the entire industry, as we urged and as Dr. Bladen recommended?


Paul Raymond Martineau: The hon. member answered his own question when he said the Conservative party had applied the policy. Surely it was a beginning of the policy, if the government had already begun to apply it.


Mr. Gerard Perron (Beauce):: Mr. Speaker- [Text]


Herbert Eser (Herb) Gray: Mr. Speaker, may I direct a question to the hon. member for Pontiac-Temiscamingue-


Mr. Deputy Speaker:: I have already recognized the hon. member for Beauce.


Gérard Perron: Mr. Speaker, at this stage of the study of Bill C-95 to amend the Income Tax Act, we are presented once again with the spectacle of the two old line parties chameleon-like, changing hue according to circumstances.
Since this legislation was introduced, we have been listening to a dialogue between advocates of taxation. As a matter of fact, since the Conservative party has been sitting on this side of the house, its members have blamed the government for adopting certain policies or for changing the Canadian taxation system in order to solve existing problems.
On the other hand, those who now sit on government benches used to criticize the Conservative party for exactly the same thing hardly six months ago.
This leads us to note obvious discrepancies between certain statements.

Mr. Speaker, I should like to deal with those contradictions at the outset of my remarks and, in order to do so, I refer to Hansard for October 16, 1963. When he introduced this bill, the Minister of Finance (Mr. Gordon), said, as reported on page 3639 of Hansard:
If we do not do this, Canadians may well wake up some day and perhaps sooner than they think, and find that they have lost control not only of their economic destiny but of their political destiny as well.
On the other hand, the minister delivered a speech before the international monetary fund, on October 1, 1963. Here is the report of that speech as published by La Presse:
No economic nationalism-Gordon
The minister told reporters that he was concerned when responsible American officials or reporters considered as a policy of economic nationalism the steps taken by Canada to reduce its heavy international payments deficit.
The mere fact that foreigners thought that we were considering a monetary policy of economic nationalism worried the minister.
At the resolution stage, he stated that the purpose of this legislation is to save Canada from its present position or, at least, to recuperate part of the ownership in our own enterprises. What a contradiction. It is not surprising though since the minister is not concerned with contradictions. In fact he abolished the 30 per cent tax on investments or on the sale of shares of Canadian companies to foreigners. In addition, he was forced to amend the sales tax on building materials in such a way that it is now set at 4 per cent, to be raised later on to 7 per cent and still further increased, in the end, to 11 per cent.
These are wrong remedies, ill-conceived measures to use against the problems facing Canada at the present time.
Let's face facts. The province of Quebec has been placed in a tragic position, as a result of the measures announced by the government. Actually, last month, when the government listed the designated depressed areas, we found that, out of the 35 areas so designated, 13 were in the province of Quebec.
Moreover, when, on October 14, 1963, the second list was tabled in the house, we found that, out of the 31 new designated areas, 15 were in the province of Quebec, so that now Quebec has 28 depressed areas out of a grand total of 66.
We appreciate the fact that some people believe that the statements of the Minister of Finance on the amendment to the Income Tax Act may encourage new investments to promote, in these depressed areas, the establishment of plants for the processing and manufacturing of our raw materials. I wonder, however, if here again, we are not given ill-conceived measures and wrong remedies.
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If we want any more contradictions, we have a monopoly in the province of Quebec, as I just stated, with regard to the depressed areas.
We also heard many a time during a certain election, two or three years ago, in 1960, that the unemployment problem in this country, and more particularly in the province of Quebec, was primarily a matter for the provinces and, second, that it was dependent on a real, honest and sincere co-operation with the federal authorities. At that time there were nearly 200,000 unemployed in the province of Quebec alone. Today, we still hold that record, as shown by the following item which appeared in La Presse of Thursday, September 19, 1963:
The greatest number of unemployed was again found in Quebec. There were 108,000 of them, representing 5.5 per cent (against 5.7 per cent in July). In absolute numbers as well as in percentage, the decrease has been much stronger in the provinces to the west of Quebec: Ontario had 72,000 unemployed, or 2.8 per cent of the wage earners (against 3.2 in July); the prairie provinces had
23.000,	or 1.9 (against 2.4), and British Columbia
32.000,	or 5.0 per cent (against 5.5).
Now, when we rise here, in this corner of the house, to demand a real solution for this problem, when considering this legislation to modify the Income Tax Act in order to promote capital investments, we want to suggest other remedies than a dialogue between taxers, and to make suggestions which should be taken into consideration if there is a real wish to find a solution for the economic problem of Canada which has become a menace, considering the critical condition in which the province of Quebec finds itself as, not having been given its due share in Canadian economy, it is unable to settle its unemployment problem.
When speaking of wrong remedies, I may say that they have been tried in our province. We had the winter works program. There again, we were supposed to have found a solution. But look at the results today.
We tried, for a certain time, I think, to allow deductions only to corporations, which was again a wrong cure.
Considering that, with a budget of $6 billion which we have in this Canadian parliament, corporations are taxed at 20 per cent, whereas the salaried people, the small wage earners and those who have a medium income-if we wish to include them-have to pay 30 per cent of the total intake of the federal government, I may say that there is hardly any reason to rejoice.
The minister is considering tax exemptions for present and future industries in order to boost the economy not only of the depressed areas but of the whole country. He must tap other sources to solve that problem in Canada.

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There has been some talk about income tax deductions. A while ago, in support of his argument, the hon. member for Pontiac-Temiscamingue (Mr. Martineau) even quoted certain economists and advocated income tax exemptions to get our economy going, to facilitate foreign investments in Canada and to encourage the establishment of secondary industries for the processing of our raw materials. He also referred to the statement made this morning by the Minister of Industry (Mr. Drury) concerning the automobile industry. The Conservatives tried tax exemptions in favour of large companies, and see where that led.
I have here a report of the petroleum industry which appeared in Facts and Trends, a newspaper published by the oil chemical and atomic workers unions. It reads partly as follows:
British American	Oil	$32,600,000
Imperial Oil	67,800,000
Texaco-Canada	11,100,000
Royalite	2,100,000
A few years ago,	legislation was enacted by
parliament, under the Conservative government, to provide exemptions for those companies. What result did that give?
Let us see what are the profits per manhour of those companies and, later on, we will compare them with the income tax paid by the small wage earners of whom I spoke a while ago:
Profits per man-hour
British American Oil	$2.17
Imperial Oil	2.59
Texaco-Canada	1.97
Royalite	1.60
The table shows that the companies' manhour net earnings were often higher than the wages of the workers. Those are the companies to which the government wants to grant tax concessions, when 30 per cent of all federal revenues come from taxes paid by small wage earners. Is this not a shameful and sad joke to play on the people who are trying to build up our country? It is for such companies that tax concessions are being considered under the pretext that such a measure will attract new industries when, in fact, it will only increase the foreign control over our economy. Think of it. Those companies pay only 20 per cent of tax revenues whereas their employees pay 30 per cent.
Surely, there must be other solutions than to encourage new companies to come and establish themselves in our country. It is not that I am against the processing of raw material at home through secondary industries. On the contrary, that is what we have been clamouring for.

During a debate, I was recalling here, last fall-of course I come from the eastern townships and I was speaking as a member in this house for that district-that the asbestos production amounted in 1957 to $107,058,000 whereas the exports of the raw material amounted to $104,489,431, and that, in 1958, the corresponding figures were $92,276,748 and $90,345,000, in 1959, $107,433,344 and $110,431,000, in 1960, $121,400,015 and $120,113,000.
I believe that we are entitled to consider essential that industries establish themselves in our country to process those raw materials, and that, for several reasons. First of all, to improve our unfavourable balance with our friendly neighbour country, which is of the order of $1 billion per annum; a fact which was made clear when the last budget was tabled. Our unfavourable trade balance with the United States has reached $1 billion a year.
We export the larger part of our asbestos to the United States, as raw material, while we import a fairly good quantity of finished products.
We have imported finished asbestos products, according to the 1962 Canada Year Book, for an amount of $4,078,000 in 1959 and of $4,498,000 in 1960. Which means that despite our trade deficit, we find means to import from them those finished products, while we allow them to come and get in this country that raw material, that resource which certainly belongs, to a large extent, to the Canadian people.
Moreover, there are other imports of finished products, such as asbestos products, that we buy from other countries which take our raw material-the United States, for instance-to turn it into finished products. We imported for over $25,800,000 during that same period, whereas, at home, in the province of Quebec, in particular in the eastern townships, we have hundreds of unemployed who are waiting for the opportunity to process their own resources, to the advantage of their fellow citizens.
I admit that it is important and urgent to amend the Income Tax Act. But how can we amend it? Simply by giving incentives to alleged capital investments through corporation tax exemptions, and especially dividends? I do not think that solution is possible, and I am sure it is a wrong solution.
That is why we are bringing forth suggestions, not simply on the basis of whims, but rather on the basis of statements made by a body as important as the information branch of the Department of Labour. I have here a report from that branch, dated May 8, 1950. At that time, the Liberals were in office

and here is what they advocated to get the economy moving again and to settle the monetary problem:
As regards the light against unemployment resulting from inadequate total demand, the report points out that the methods to be used will necessarily be different in each country in accordance with the structure and the degree of development of the economy.
Among the measures that can be used, the experts mention the expansion of credit facilities, the lowering of interest rates, the adoption of an appropriate tax policy, the carrying out, under the government, of industrial research and the development of new industries and new products.
It was the Liberals who issued that release in order to solve the unemployment problem.
It said further down:
Under certain circumstances, the government may also deem it necessary to affect investments to the purchase of surplus stocks of goods which tend to have a harmful effect on the stability of the market. When the level of total demand goes down, the government can try, through various means, to increase personal consumption expenditures.
And here, between brackets, the ways to do it are indicated.
It was the Liberals who at that time advocated those solutions. They seemed to know some solutions other than taxation. They said:
-decrease of personal taxes, increase of social benefits, consumption subsidies, reduction of commodity taxes, etc.
At that time, the Liberals knew other formulas. Why are these not tested in 1963? At the present time, we are facing unemployment problems in depressed areas. All across the nation and especially in Quebec, there are depressed areas. The situation is becoming tragic. As far as unemployment is concerned, 40 per cent of all depressed areas in Canada can be found in the province of Quebec alone. I think the situation is becoming tragic. That is why it is most urgent to find other solutions than those applied up to now.
Since the Liberals are now trying to solve the problem, why are those suggestions not being followed instead of allowing our country to remain under the control of foreign interests when other means could be used. Besides, I shall have the opportunity to quote other statements made by the Liberals which will give cause for reflection to my friends opposite with regard to the monetary system.
It will be remembered that according to the Liberal program of which we heard so much during the last election campaign, the financial system was to be improved.
Do you want some solutions? The Social Crediters have suggested a few, such as first of all, incentives to consumption.
Factories are built when those already in existence cannot be properly operated so as to provide regular work by reducing the work
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week, because we have a surplus of commodities which remain unsold. This does not prove surely that the needs of Canadian consumers are met.
It has been established that people in depressed areas who draw social security or unemployment insurance benefits are certainly unable to meet the essential requirements of their families.
Therefore, there is actually over production in certain fields but it is due in great part to und erconsumption.
That is why I am convinced that the suggestions made by the Social Credit members in this house should be considered much more closely than they are at present.
I believe that income tax exemptions should be granted to the consumers instead.
Did the President of the United States not declare, only three months ago, that he was considering the need to promote consumption, in order to give a new impetus to certain consumption industries in the United States and reduce the taxes that are a burden for small wage earners? There must have been some experts in the United States to give such advice to the President.
It is the most suitable formula to promote consumption. It would especially be necessary to encourage the establishment of new industries, and this particularly in our country, so as to solve our unemployment problem to some extent.
The Liberals are well aware of this. I have in hand their program on full employment which was widely distributed throughout the province. Here is what they say about the unemployment problem and finance in our country:
Taxes will be reviewed to encourage enterprise and to remove impediments to the development of
business.
The financial machinery of the country will be improved in order to provide additional capital for industrial development.
To improve the operation of our financial system to provide additional capital for industrial development. Why not use an institution which belongs to the Canadian people, namely the Bank of Canada, to find the necessary capital investments for the development of our national resources?
The Liberal program also states:
A Liberal government will resolutely assume the political control of money and credit and will use them to foster economic development while maintaining stable prices.
That was in the Liberal party platform, Mr. Speaker, before the election held last April 8.
That is what we advocate also. The government should exercise its sovereignty in other ways besides levying taxes or, for instance,

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instituting proceedings against people who have included charitable receipts in their income tax returns. The government should exercise its sovereignty and allow its own institutions, the Bank of Canada for instance, to create the money needed to solve all the problems facing the country, which would enable the Liberals to fulfil the promises they made throughout the country during the last election campaign, last winter.
Not much importance is given to those promises after the election. I notice that the hon. member for Hull (Mr. Caron) is asleep. And yet he claims to be the great champion of the French Canadians in the province of Quebec. These problems do not seem to worry him too much, Mr. Speaker.
And yet, those are facts, things they not only said, Mr. Speaker, but had the nerve to print and distribute throughout the province of Quebec. If they did not believe in them at the time, why did they mislead the people in that way, especially the French Canadians, leading them to believe that the Liberals had a policy that would get the country's economy moving again? But no. After the election, it is a complete reversal of position. We are used to such reversals, but they are more obvious since the election of last April 8. They showed in various statements made by the ministers.
Therefore, I ask the government, through its representatives in the house, who are truly responsible to the electors, that the small wage earners be the first to enjoy an income tax exemption. This will increase their purchasing power and will allow industries to acquire what they need for a greater development.
We shall have then a real planned economy, going in the right direction, because the consumer will look after his needs, since he will be in a position to buy consumer goods, the financial means being available to him.
Furthermore, our industries will be able to meet the needs of the Canadian nation because, otherwise, and I am convinced of this, we are increasingly going towards state planning.
What will happen then? The formula has already been put to a test. We know that there cannot be three or four methods of economic nationalism. There is only one which is truly Canadian, it is the economic nationalism advocated by the Social Crediters, which considers the consumer as a king because the primary purpose of all production is consumption, and production must be geared to the rate of human consumption in order to satisfy the needs of human beings.
The revision of our whole fiscal policy and monetary system must tend to achieve not

only this goal but also to improve our balance of payments with foreign countries.
Mr. Speaker, I do not think that the people will see the end of unrealistic solutions as long as the old line parties are in power. Take the dialogue between "taxers" which goes on under our very eyes, the speeches about those so-called alternatives: I wonder what the Minister of Finance will do about them on the day the Quebec ultimatum expires, when the provinces will claim 25 per cent of the personal income taxes and 25 per cent of the corporation taxes.
Why are the rights of the province of Quebec flouted when it comes to granting tax exemptions in this or that area, in full or in part, to corporations?
Is it not a direct denial of the rights of the province of Quebec? The minister should hasten to find other formulas than taxation and fiseality in order to meet the deadline set by the premier of Quebec on taxation rights, estate duties and corporate and individual income taxes.
I wonder if we are not going round and round with those formulas aimed at amending the Income Tax Act. Where do we stand now?
Let us find out who has the responsibility to get the economy moving again so that Canada may become a country where future generations will bless or curse us according to the action we take today to free the people from the economic control of the neighbouring country to which I referred a while ago when I quoted an excerpt from the statement of the Minister of Finance in which he said:
If we do not act along those lines, Canadians may very well awaken some day which might be sooner than they think, and realize they have lost all control not only over their economic destiny but over their political destiny as well.
It is with that in mind that I should like to see the government initiate not only a serious study of taxation in Canada but also an extensive revision of our monetary policies, which would meet the present and future needs of the Canadian nation, if we are to continue to live in this country where both nations have at the present time the dreadful choice to part or establish a monetary policy which will respect the human person-who has been looking forward to that respect for a long time-in the economic field. In short, parliament should bring about a monetary policy which, while respecting the dignity of the human being, would facilitate access to our country's abundant resources.
In my opinion, these few suggestions that I wanted to submit to the house should be taken in serious consideration and proper solutions for the needs of our time should be brought forward for this problem. The pick and shovel era is over; that is why winter

works were a failure. We are at the height of the twentieth century when everything goes fast.
Then let us hurry lest in 1967, the centenary year, the province of Quebec, which has felt frustrated and baffled for so long in the rights vested upon her by the British North America Act, take steps which may be deplorable for the whole Canadian nation.
Let us hurry to find a solution. Let us use the supreme authority of parliament and exert it on the Bank of Canada, whose objects vested upon it in 1934 gave it power to mint credits which Canada needed. Let us stop considering formulas which are ineffective.


Miss Pauline Jewett (Northumberland):: Mr. Speaker, following the previous two speakers both of whom have, it seems to me, argued that two of the very major problems facing Canada today are unemployment and domination of our resources by outside interests, I can only agree with them that these are the problems, and that these were the problems that were discussed in the recent election campaign; indeed the speech we have just heard sounds like one that had been prepared for the hustings and warmed up for today.
I cannot, however, agree with the previous speaker that this party committed itself to a course of action which would involve the kind of monetary control and use of the Bank of Canada which he suggests. I do feel, however, that through the present Minister of Finance we have tried to-


Gérard Perron: May I direct a question to the hon. member?


Pauline Jewett: When I have finished.

I do feel though that through the propositions we have today in the income tax amendments of the Minister of Finance we are making some fairly strong, indeed very strong attempts to meet these two major problems, and other problems as well. This is true particularly of the two I have mentioned-unemployment, primarily in the chronically slow growth areas, and outside domination of our resources.
All of us on this side of the house, certainly I can say this of myself, and I am sure of others as well, are pretty well convinced, and have been for some time now, that under the present Minister of Finance we are at least going to have taken the kind of action that will do something about these two problems.
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We have all spent a great deal of time talking about these problems, both in and out of parliament. As we all know, it is much easier to talk about them than to take action, because these are very difficult steps to take. Obviously they are going to hurt some people. Obviously some members of the business and financial communities, and of other communities, as well as other countries, will not like them. It is inevitable that when a nation tries to control its own destiny, or tries to take strong steps to curb unemployment and create a higher standard of living, somebody is going to get hurt.
We wish this were not necessary. We would like to see everybody go along happily with everything that is done, but unfortunately this is not always the case; and when you take action, particularly in the economic sphere, you are bound to step on a few toes. But because a few people get hurt this is no reason to get up, like the hon. member for Pontiac-Temiscamingue (Mr. Martineau) did and say we should not take any steps at all. With that line of reasoning we would never do anything to curb and cure our basic, chronic unemployment.
The step I want to talk about primarily today is the part of the income tax amendment which has to do with tax incentives to new industries in designated areas. If the play of economic forces were working perfectly naturally and freely, if this free play of economic forces we always hear about, and which the hon. member for Pontiac-Temiscamingue referred to, were really operating, there would not of course have to be any tax incentives for certain designated areas of chronic unemployment and slow growth.
If the system were working as it is supposed to, labour would move out of the areas where there was surplus labour, or industries would move into those areas; but in fact of course neither in Canada nor in any other known industrialized country does the free play of economic forces operate in this ideal fashion. In practice, even in the most mature and sophisticated industrial nations, there are, have been, and continue to be, areas of chronic unemployment and slow growth. This has been true in Great Britain, France, Denmark, Belgium, Norway, Sweden, Italy, Ireland and the United States' and certainly it has been true in Canada as well.
However this is not to say that there has not been a high degree of mobility of labour. In fact, in all of these countries the problems of slow growth areas would have been very much more serious had there not been a fairly substantial degree of mobility of the labour force. For example, I was amazed to read the other day that in the United States it

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is estimated that one citizen out of five changes his state of residency every year. This is really fantastic mobility when you think of it-that one out of five should change his state of residence every year.
Even in Canada, where I think we sometimes tend to feel we are a fairly stick-at-home kind of society, where we do not move around very much, the figures, particularly in the last census, show a very, very high degree of mobility. The very fact that only 11 per cent of our labour force is now working full time in agriculture suggests this, and also the fact that in the 1961 census it was shown that 45 per cent of our whole population now lives in the 17 metropolitan areas picked out by that census. It was 40 per cent in 1951, and is 45 per cent today. No doubt it will get higher, and this of course suggests and implies that there has been a very substantial mobility of labour.
Some work has been done with family allowance statistics, estimating that between 400,000 and 500,000 Canadians change their province of residence every year. This is a pretty high level of interprovincial migration for all provinces, for Quebec and Ontario just as much almost as for the maritime and western provinces. It seems to me that these figures shed in their way a new light on Canadian society, and since I am talking about them I might as well mention that in the 17 metropolitan areas of Canada which had 45 per cent of our population in 1961, over 1,700,000 of their residents came from countries outside Canada, and further, almost one million of the residents of those 17 cities came from a province other than the province in which their respective city was located.
All of these figures, and many others I could cite, present a picture of Canada that is quite different from the mythology that has been built up. There may be an occasion later on to say more about this, but in the meantime if any hon. members are interested, there is going to appear in the fall issue of Queen's Quarterly an extremely interesting article by Miss Yoshiko Kasahara of the dominion bureau of statistics called "A Profile of Canada's Metropolitan Centres".
Despite this very high degree of mobility from rural to urban centres and from one province to another, to say nothing about the very great intraprovincial migration, the statistics of which are not yet available, we still have in Canada, as has been the case in other western industrial countries, areas of what we call chronic unemployment, areas of slow economic growth, areas where labour does not always move out and where, if it does, it is frequently, of course, the younger

workers. These are areas, therefore, of real social need where there are large numbers of unemployed and where there is not a great deal of opportunity for them.
Countries in western Europe, and indeed Canada too, have tried to find means of encouraging people to move out of these areas. The results of these efforts have been, in many instances, very discouraging. I noticed one particular story in the United Kingdom where there was an attempt to relocate workers. It is told that a party of loom-tuners and their wives were taken by coach to visit another works in the same organization in a different part of the country. They were provided with hotel accommodation and taken to see the works and the surrounding district, in the hope that at least some of them would decide to take up employment there. These were people who were going to be out of jobs in the mill in which they were then working. But not one man accepted the offer, after this great party they had been given to go and see the new mill. Similarly, the French government and the E.C.S.C. made provision for the transfer of 5,000 miners about to be displaced from the Centre-Midi coalfield to Lorraine. When only about one tenth of them moved, the plan was shelved. One tenth were willing to move, but nine tenths were not. The same situation has been found in New England textile communities.
Even though there is very great hardship involved in staying put, geographical mobility has not been sufficient to remove these workers from what seem to be generally called depressed areas. People do not want to move. Sometimes, because of habit, inertia, old ties or whatever may be the cause they would rather stay where they are with only half the wages than move to a new area. Unless we are going to insist that people move out of areas to areas of better potential, we must try to make some provision for a better life in those areas.
We should of course continue to encourage as much mobility of labour as we can. In most European countries it is a two-pronged policy; on the one hand you continue to encourage the mobility of labour, you continue to encourage people to move to areas where the potential for growth is better; but on the other hand, knowing that you cannot always get them to move, you initiate policies which will at least provide a reasonably adequate life for them where they are.
One of these policies is to induce industry to settle in these areas. Inducing industry to settle in these areas has, of course, another purpose. Most countries are reluctant to see only certain centres built up too much; they do not want to see too great a congestion. The United Kingdom, for example, is really

concerned that the area around London become too congested. Similarly, in Canada I think we should become concerned if the area around Toronto, the golden horseshoe or whatever it is called, should become too congested. Certainly I would wish it would come a little further east along the lake into Northumberland county.


Some hon. Members:: Shame.


Pauline Jewett: But for social reasons, and not only for economic reasons, we are concerned that we do not simply focus on certain areas in our country. This, I think, is particularly true for us in Canada. We do have a nation from sea to sea; we presumably want to keep the nation from sea to sea. I was discussing this question the other day with a former colleague of mine, Professor Porter, who is probably the most perceptive sociologist in Canada. He was saying it is nauseating to realize that the myths by which we live are geographical-from sea to sea. The myths the United States live by are social-all men are born equal. The myths that France lives by are social-liberty, equality, fraternity. But poor old Canada, we do not have these kinds of charter social myths; we have geographical myths-from sea to sea. But, of course, we do have a lot of geography. It has been our big problem, and is our big problem today-to make our nation a viable entity from sea to sea. This is what we are struggling with most of the time.
Policies such as are being introduced in these amendments help, I think, establish us as a nation with a national identity; to encourage an at least comparable growth of certain areas which have been depressed and are slow growth areas of Canada; to bring them along in the hope that they will be able to share more amply and, if possible, equally, with other areas in the country in the future, wherever they may be. Therefore I think this measure is a particularly important one for this country when we are stretched out on such a fine ribbon and where we do have particularly strong pressures coming upon us from outside.
The measures that are being taken to encourage new industries to settle in certain areas of chronic unemployment and slow growth are fiscal measures. Of course, this is because the federal government of this country still controls, and I hope, despite what the previous speaker suggested, will continue to control the fiscal power. Indeed, if the federal government of this country loses control over the fiscal power we might as well shut up shop as a nation-


Some hon. Members:: Hear, hear.
28902-5-256
Income Tax Act


Pauline Jewett: -because the federal government has this means in its hands, the tax power. It can use this tool in such a way as to achieve the end we all have and about which I have just spoken.
Countries in Europe that have pursued policies of helping certain slow growth areas have used other tools, and I thought I would just say a word or two about these because they may well in the future be useful in Canada even at the federal level, and certainly at the provincial level. The United Kingdom pioneered the development of national policies to attract firms to industrially depressed areas, and has perhaps carried such measures further than any other country. I was reading the other day that in the 1963-64 budget, for example, the government of the United Kingdom is giving direct grants to firms that will move into designated areas, amounting to 25 per cent of the cost of the buildings and 10 per cent of the costs of plant and machinery. These are direct grants to firms moving into these areas-something we have not yet even touched, of course, in this country. The British government also provides very substantial loans-indeed, practically all European countries do-to private enterprises that are going to certain designated areas.
In Britain, too, there is, as we all know, the location of industry policy whereby people are not told they have to go to certain areas; what happens is that before they can go to an already built-up, congested and rapid growth area they have to have a licence, and the government can decline a licence, thereby suggesting to them indirectly that they go somewhere else, and particularly to an area that has been designated. That is, again, a power we have not yet got at the federal level, although I see no reason in the world why much more could not be done along this line by the provinces than is done at the moment.
Similarly, in the United Kingdom they use the fiscal power. For example, all firms in their development districts are allowed to write off their capital costs as fast as they like. There is much expenditure of social capital too, grants to municipalities, and so on, for improving public services in the designated areas. I may say here I think the economists agree that the provision of social capital alone is not sufficient to raise these designated areas to the level of industrial development which one would like to see. The provision of roads, power, communications and the like will not suffice to stimulate industrial development to the extent which appears desirable; one has to provide more direct grants or concessions of one kind


Douglas Mason Fisher: I wonder if the hon. lady will tell me where the growth figures are contained.


Pauline Jewett: I would be glad to put one table on record in Hansard. As the hon. member rose I was about to say that one of the criteria used is employment changes during the years 1959-1962. The table I should like to put on record relates particularly to Brantford and to the five adjacent communities. When we take these figures for all the different national employment service areas of Canada we get a picture of what the economic growth of an area has been. For example, the economic growth of the Brantford area has been about one sixth of the national average over this number of years.


Mr. Deputy Speaker:: Does the hon. member have permission to place this table on Hansard?


Some hon. Members:: Agreed.
[Editor's note: The table above referred to is as follows:]

Income Tax Act



EMPLOYMENT SUMMARY

[Stage Direction]
In labour surplus Category % of 48 summer months. Years 1955-1962	Employment Change. Years 1955-62	In labour surplus Category % of 18 summer months. Years 1959-1902	Employment Change. Years 1959-62	Employment changes by year during years 1959-1962	1959-60	1960-61	1961-62BRANTFORD.	... 87	+ 2.2%	89	- 7.4%	- 7.0%	- 1-6%	+1.2%Guelph	... 21	+19.7%	39	+ 2.4%	- 4-3%	+ 2.2%	+4.7%Galt	... 21	+22%	28	+ 6.2%	+ 6.1%	- 6.0%	+6.5%Kitchener	. . . 4	+30.4%	11	+ 9.8%	+18.6%	-14.0%	+7.7%Woodstock	... 15	+35%	17	+ 1.1%	- 0.8%	- 3.8%	+5.8%Stratford	... 2	+31%	0	+12.6%	+ 4.8%	+ 0.6%	+6.8%National	National	Average 15%	Average 4%
Douglas Mason Fisher: What is this	statistic of	eco- I	think there	is a lot	to be said	for this
nomic growth? Is the hon. member suggesting it is the rate of employment? Is it the rate of unemployment? Is it the number of people in the labour force or the number of jobs created? I cannot follow her.


Pauline Jewett: It is based primarily on the rate of employment growth.


Douglas Mason Fisher: I disagree.
method, especially when one is thinking in terms of future potential. But, for the time being it seems to me that the criteria which have been used in this case, namely, employment and unemployment figures over the past eight years, are perhaps the best which could be used in the circumstances, and that the size of the areas designated is also the best which could have been arrived at.


Pauline Jewett: There are other and more discretionary ways of determining whether an area is capable of future self-sustained growth. I am not sure the bare figures of employment growth are enough to enable one to say that an area is capable of future development and, particularly, of self-sustained development. I would agree with the hon. member as to this. However, I think this method gives a good general picture of the growth of one area as compared with another over a period of time.
The point I wish to make is that with regard to these areas we are using figures and statistics from the past which are, after all, the only ones relevant if it is intended to use objective criteria. But in order to be able to choose areas which have a real potential for expansion on a self-sustaining basis, other factors must be taken into consideration, as is done in most European countries. This involves the use of a great deal more discretion, and the possibilities in this direction will increase when we are mature enough to allow this discretion to be exercised, and not to complain, for example, that a certain area has been designated or excluded for purely political reasons. In Sweden, this selection is done entirely on an ad hoc basis.
I do not think that the rules governing designation are immutable, as were the laws of the Medes and the Persians. Changes can be made as we see how they work out in the course of time.
It has been suggested by the hon. member for Burnaby-Coquitlam that not nearly enough people in our labour force are affected by these tax incentives. Actually, 10 per cent of our labour force will be aided by this measure. This is somewhat below the percentage in Europe where between 12 and 15 per cent of the labour force is affected by relocation measures. Perhaps we should bring the percentage affected in Canada to a higher level in future, as we see how the legislation works out.
Having said this, let me add that it is important, in trying to provide for a more equitable rate of growth and a higher level of employment in certain areas in Canada, that we should work as closely as possible with the provincial governments. My impression is that many of the provinces have not yet got their teeth into this problem. I know the province of Quebec has for a long time wished to encourage industry to move away from the Montreal area, but as far as I know they have not used any of the tools at their disposal to bring about this result. I think the

federal government should work very closely with the provinces in this connection. The Minister of Industry has suggested that consultations have already been held on this subject. This is a national problem, just as the total question of unemployment is a national problem, and both levels of government must be concerned about its solution.
Finally, we must not forget that although these areas of chronic unemployment are always areas of difficulty, the basic need in this country is the raising of the aggregate level of demand. The total level of employment must therefore be raised. Chronic areas of unemployment will also be better off, once there is a high level of employment and income generally in Canada.


Gérard Perron: Mr. Speaker, while the hon. member for Northumberland (Miss Jewett) was making her comments, I asked if I could put a question to her. Since she told me to wait until she had finished her speech, I wonder whether I could put my question to her now?


Pauline Jewett: Yes, Mr. Speaker.


Gérard Perron: Mr. Speaker, if I am not mistaken, the hon. member suggested that I had made a pre-election speech. I would ask her then if, in her opinion, we should not take the same stand before and after an election.
I would also like to ask her this other question: Is it not because of the sharp contrast between the monetary policy advocated by our hon. friends opposite prior to the April 8 general election and the complete turnabout they have made since that she feels our speeches rather sound like campaign speeches?


Pauline Jewett: Not at all, Mr. Speaker. I just thought it sounded like a hustings speech rather than one based on reason.


Mr. D. R. Gundlock (Lethbridge):: Mr. Speaker, the house has listened this afternoon and previously to a great deal of discussion about areas. We have listened to discussion about areas, local areas, provincial areas, national areas, international areas and even economic and political areas. I simply want to bring one matter to the attention of the house and I am almost at a loss as to the area of approach to this question. It is the area-I cannot get away from the word "area" because I have listened to it so long this afternoon-between the actual legislation and the application of the legislation as we know it back home in our constituencies, or as Mr. and Mrs. Jones know it on the street.
28902-5-257
Income Tax Act
I should like to bring an example to the minister's attention. Although the situation may not apply only to the Income Tax Act I realize we are confined to that act and the amendments. I could take a great deal of time this afternoon in going through the amendments clause by clause, but I have no intention whatsoever of doing so. I hope the minister will pay some attention to the point I wish to put before him. I know that probably his first answer will be that the problem is an inherited one from the previous Conservative government, but if we are faced with that answer I will have to remind him that we have been confronted with it under many previous administrations. I am honestly and conscientiously bringing this to the attention of the minister in the hope of some kind of improvement. Members of the house have heard about the same problem not only concerning the bill before us but also with regard to other legislation throughout the years. Admittedly I have not been here very long, but from reading Hansard I know that the same problem has been raised.
It is all right to talk about international areas and other geographical areas. We talk about France and many other nations, but to my mind we have not approached the problem which I wish to bring to the attention of hon. members this afternoon as I have on previous occasions. The problem simply concerns the difference between the actual legislation and the application of the legislation, and to attempt to make myself clear may I give an example, though not a specific one. We discuss the legislation here time after time but when we go back to our constituencies we hear complaints and pleas. What do we find when we go back to our constituencies? There is nothing in the legislation concerning the problem I am bringing forward.
I realize this is not a grievance period. I am only attempting to present something to the minister for his consideration. I think we are quite fortunate in having an author as Minister of Finance. I think this is a good time to have such a minister for the consideration of a matter of this kind, because the gap between the legislation and the application thereof is so wide.
I should like to bring a short example to the minister's attention. I have had complaint after complaint. Indeed, I would think all Alberta members and other members from rural constituencies who have anything to do with the farming population have also had complaints. We heard something earlier about the purchasing of sale agreements. There are a lot of concessions in this regard in certain areas. I cannot get away from the word "area". If I may put the example briefly, it

Income Tax Act
has to do with farms where there are rocks or stumps, or anything else that prevents the easy application of farming methods. This is often the case in Alberta and I am sure in Ontario and other provinces.
A certain area of land is purchased under an agreement for sale with the intention of tilling, cultivating and putting in a crop in order to earn income. I could go through all these sections, Mr. Speaker, but under the capital allowance provisions we are allowed or disallowed a certain amount for improvements. Whether it is the initial removal of rocks or roots or clearing, or even the application of fertilizer, does not make much difference. In grey soil areas particularly there is a need to fertilize in addition to clearing before anything can be grown.
I am speaking particularly about clearing, which involves a cost the same as anything else. There is a certain allowance and it can be very great. It varies. Some people probably clear and break virgin soil for practically nothing. Other people spend as much as $20, $25, $30, $35 or $40 an acre to bring the soil into production.
I hope I am not wandering too much but I am simply trying to set forth this example. I realize the minister is going to say almost immediately that this is an inherited problem which the Conservatives had and did not do anything about and I have to say, of course, that the Liberals also had it and did not do anything about it. But I do not really mean that. The point is that year after year a certain percentage of the people are usually faced with the same problem involving the removal of rocks and have to make expenditures which are not allowed under the Income Tax Act and which I think should be allowed. I should like to draw this matter to the attention of the minister.


Mr. Weichel:: I rise on a question of privilege.


The Acting Speaker (Mr. Batten):: Is the
hon. member rising on a question of privilege?


Oscar William Weichel: Yes, Mr. Speaker. On Thursday, October 24, 1963, as reported at page 3957 of Hansard, the hon. member for Winnipeg North (Mr. Orlikow) made a statement which concerned one of the top industries in Kitchener. He said, in part, as follows:
The Canadian economic foundation is an operation which exists mainly to extract funds from reactionary and gullible employers who desire to fill the minds of workers in Canada with antisocial free enterprise propaganda. This organization has been used by two companies which have contracts with the United Steelworkers of America, namely Joy Manufacturing of Galt and the Toronto Iron Works. It has been used by the Dominion Rubber Company of Kitchener with very disastrous effects on the rubber workers union.

Since this company is located in Waterloo North, Mr. Speaker, I was quite concerned over the remarks made by this hon. member. I have communicated with this firm to find out if such an accusation were justified. I was told by Dominion Rubber Company that such a statement is absolutely false. I might mention that this company in Kitchener pays a higher wage rate for similar jobs than most other companies.


Herbert Wilfred Herridge: Income Tax Act
they have been receiving the moral support of local communities.
There is also the question of the depreciation allowance.


Mr. Moreau:: Would the hon. member permit a question?


Herbert Wilfred Herridge: Certainly.


Maurice John Moreau: I was just wondering whether, in this story of the Reeves MacDonald operation, the hon. member would be able to supply the figures of what the cost would be to the mine if it paid these additional wages? It does not seem to me that $279,000 in dividends is a very large profit for a mine. Could the hon. member supply the costs?


Herbert Wilfred Herridge: I have not got any figures as to the costs, but the point of my argument and that of the union representing the miners, and of the miners themselves and the communities supporting them, is that the price of metals has gone up considerably in the last six months. I have talked to mining engineers employed by other companies in the area, and everybody who understands the situation knows that this company is treating these miners unjustly, and is not accepting its responsibilities to the Canadian workers and the Canadian economy by allowing the mine to be closed up because of its refusal to pay reasonable wages under these present circumstances.
I might say, in reply to the hon. gentleman who asked the question, that owing to the increase in the price of metals, and even before that, the company was well able to pay the modest increases recommended as the result of the unanimous report of a conciliation board, the chairman of which was a former minister of mines in a Liberal government of British Columbia, and who is himself a mining engineer. This man knows the mining industry. I myself know him very well. He is very competent in that field and I give him full credit for that, even though I have often differed with him on political questions. He is not one to go overboard in these matters. He saw and assessed the situation independently, and no one can say with any truth whatever that all the factors were not taken into consideration.
I have brought this unusual situation to the attention of the minister so that he and his officials will have some opportunity to study the question. I suggest that consideration should be given to the lack of responsibility on the part of this corporation, and others who act in the same manner, who fail to accept their responsibilities to the Canadian people and the workers concerned, and to the industry in general, so that something

may be done to amend our income tax legislation to prevent these people from taking such irresponsible action while at the same time taking advantage of the provisions of the Income Tax Act.


Herbert Eser (Herb) Gray: Mr. Speaker, in the few minutes left to me before five o'clock I would like to express my strong support for this bill, particularly because of the incentive measures referred to by the hon. member for Northumberland (Miss Jewett). Most of us have recognized in one way or another the problem of the existence of areas of slow growth and chronic unemployment. Now that we have recognized the problem-and it was recognized in very limited part by the previous administration-it is time to do something about it, and I think the measures proposed in this legislation will go a long way towards dealing with it.
However, the advantage that we propose in this legislation, and in affiliated legislation governing the Department of Industry, is that what we do will not be a chance, secret order in council decision by cabinet, but will be carried out through a permanent agency set up to identify these areas after applying the criteria now embodied in legislation. Mr. Speaker, may I call it five o'clock?


Mr. Deputy Speaker:: Order. Would the hon. member move that the debate be adjourned?
On motion of Mr. Gray the debate was adjourned.


Mr. Deputy Speaker:: Order. It being five o'clock p.m. the house will now proceed to consideration of private members' business as listed on today's order paper, namely public bills and private bills.



SMALL LOANS ACT


[Stage Direction]
On the order:
Second reading of Bill No. C-14, an act to amend the Small Loans Act-Mr. Orlikow.
Some hon. Members:: Stand.


Mr. Georges Valade (St. Mary):: On a point of order, Mr. Speaker, I notice that Bill C-14 and Bill C-23 have exactly the same words and are the same bills in essence, even though they have been introduced by different hon. members. I think this is contrary to the rules, and I ask you-


Mr. Deputy Speaker:: Order. My understanding is that this bill is not before the house. It has been allowed to stand; therefore it should not be debated.


Georges-J. Valade: On the point of order, Mr. Speaker, my point is that the other bill is of

a similar nature and is quite identical in wording. Would Your Honour give a decision, because we are doubling these bills?


Mr. Deputy Speaker:: I am sure the hon. member would agree this should be done when the bill is before the house. It is not before the house, and therefore this is not an occasion for the Chair to point to any irregularity that is attached to the bill.
Order stands.



RAILWAY ACT


Mr. W. H. A. Thomas (Middlesex West) moved: the second reading of Bill No. C-27, to amend the Railway Act (Abandonment).


Mr. Macdonald:: Mr. Speaker, if I might be allowed to do so I should like to raise a point of order in connection with this particular matter. The point of order, in brief, is that the subject matter of this bill falls, not within the jurisdiction of this parliament but within the jurisdiction of the particular provinces in which the land may be situate, and for that reason it is not competent for this parliament to debate the matter at this time.
I may say, Mr. Speaker, I have the greatest respect for the hon. member for Middlesex West (Mr. Thomas) and out of respect for him I would like to give in a little more detail the reasons for arriving at that conclusion, and I should like to make reference to the appropriate legal authorities that relate to this question.
If I could summarize briefly, Mr. Speaker, the purpose of the bill-and I hope the hon. member will correct me if I am mistaken in this-is to confer upon the board of transport commissioners the power, after it has approved the abandonment of a railway line under substantially the terms that now may be found in section 168 of the Railway Act, to impose subsequent conditions upon a railway company as indicated in the second part of the proposed subsection, which reads as follows:
-the board shall order the company to carry out such remedial measures in the way of fencing, gates, cattle-guards, weed control, drainage works, demolition, restoration or any other remedy as the board deems necessary.
My submission is that once the board of transport commissioners has made its order decreeing that the railway line is to be abandoned, the board has lost jurisdiction and this parliament has lost jurisdiction over that particular piece of land. The hon. member has made reference to a decision of the board of transport commissioners, which may be found in volume 46 of Canadian Railway
Railway Act
Cases. This is the decision in Cairns Brothers v. Canadian National Railways. It is a decision of the chief commissioner of the board at that time, the late Hon. Hugh Guthrie, who was at one time house leader for the party of hon. members opposite. I would refer in particular to some remarks of the chief commissioner which are to be found at page 54 of the report. It was an application for substantially the same kind of relief which the hon. member is seeking in his bill. The chief commissioner observed:
It is to be noted that the requirement for fencing is that the company shall erect and maintain fences upon the railway. Where abandonment of operation has been authorized and has taken place, the right of way through which the railway is operated ceases to be used for railway purposes and is held by the company, not as part of its railway qua railway company, but in the same way as land is held by private individuals, subject to any provincial or municipal laws in respect of fencing which may be in force in the particular district.
It is to be further noted that the principal, if not the sole, reason for the fencing requirement in the Railway Act is to prevent cattle from getting upon railway lands and being killed or injured by railway operation. Where complete abandonment of a line of railway takes place, the necessity for fencing the line largely disappears, and the section does not apply. For these reasons the board, in my opinion, has no authority under the terms of the Railway Act to order the railway company to maintain fences upon the sides of its right of way under the circumstances which pertain in the present application.
At the root of the chief commissioner's observations at that time was the principle that there is inherently a conflict between the jurisdiction of the parliament of Canada and the various legislatures in so far as lands which may or may not be used for railway purposes are concerned. As hon. members know, the subject matter of property and civil rights in a general sense has been conferred by section 92 of the British North America Act upon the provincial legislatures, but by reason of the exceptions in section 92 (10) (a) and (c), it has been stipulated that railway lines can in certain circumstances be under the jurisdiction of the parliament of Canada and, more particularly, railways lines connecting one province with any other province. Section 92 (10) (a) or under section 92:
Such works as, although wholly situate within the province, are before or after their execution declared by the parliament of Canada to be for the general advantage of Canada-
The jurisdiction of the parliament of Canada, therefore, in the case of railways must rest upon those exceptions enumerated in section 92 (10) (a) or (c). I would submit, first, that if a railway line has been abandoned, it has ceased to exist as a railway and the provisions of section 92 (10) (a) cannot

Railway Act
apply because in effect there is not a railway in existence. Therefore the underlying real estate, which is all you have left in the circumstances, must be regarded in the light of the provision that it is a work declared by the parliament of Canada to be for the general advantage of Canada. A declaration may be made expressly or implicitly in legislation, and I would suggest that generally speaking with regard to railway companies it is made by the Railway Act and the relevant incorporation acts of the companies in question.
It is also clear that the parliament of Canada may by subsequent action, express or implied, withdraw such declaration and thereby return the lands to provincial jurisdiction. I would refer you, Mr. Speaker, to the case before the judicial committee of the privy council which may be found in the Law Reports, 1916, Appeal Cases, Volume II, at page 583. This is the case of Hamilton, Grimsby, and Beamsville Railway Company v. Attorney General for Ontario and others. Lord Buckmaster, who was then Lord Chancellor, speaking on behalf of the committee observed as follows at page 587:
Their lordships are clearly of opinion that section 92, subsection 10, never intended that a declaration once made by the parliament of Canada-
That is, a declaration for the general advantage of Canada:
-should be incapable of modification or repeal. To come to such a conclusion would result in the impossibility of the dominion ever being able to repair the oversights by which, even with the greatest care, mistakes frequently creep into the clauses of acts of parliament. The declaration under section 92, subsection 10 (c), is a declaration which can be varied by the same authority as that by which it was made.
My submission is that the parliament of Canada has by the Railway Act conferred authority on the board of transport commissioners to decree from time to time what works and property have ceased to be governed by the declaration for the general advantage of Canada. My submission, in particular, is that once approval has been given by the board to a railway line being abandoned as part of a railway, and once that has been acted on by the company, the jurisdiction of the parliament of Canada ceases. Under those circumstances the land, while remaining properly the property of the railway company, becomes subject to the laws of the particular province concerned with regard to questions which affect that property, such as fencing, weed control and such matters. In such circumstances, Mr. Speaker, I submit that the jurisdiction of the parliament of Canada has ceased. Therefore the proposed legislation of the hon. member would essentially attempt to confer upon the board a

power ex post facto to act with regard to land that formerly formed part of a railway and which, by the board's own decision, has ceased to be part of the railway undertaking. That land, by an extension of the same reasoning, has therefore ceased to be under the jurisdiction of the parliament of Canada.
For those reasons, Mr. Speaker, I would submit that, notwithstanding the merits of this legislation, it is not appropriate for parliament at this time to discuss this particular measure; that remedial measures with regard to fencing and the other matters referred to in subclause (2) of the proposed amendment are properly under the jurisdiction of the provincial governments and that application should be made in the provincial legislatures for remedial legislation.


William Howell Arthur Thomas: Mr. Speaker-


Mr. Depuiy Speaker:: Order.


William Howell Arthur Thomas: On the point of order, Mr. Speaker-


Mr. Deputy Speaker:: With deference to the hon. gentleman, I am prepared to make a ruling now on the point of order which has been raised by the hon. member for Rosedale (Mr. Macdonald). I might say at once that I do not agree with the hon. member and I really do not think it is necessary to continue the discussion on the point of order. I do not wish to interrupt the hon. member for Middlesex West or deprive him of the opportunity of presenting his views on this point of order raised by the hon. member for Rosedale. If he wants to submit an argument on the point of order I will give him an opportunity to do so, although I really do not think it necessary that he do so.


William Howell Arthur Thomas: I think the point has been covered in discussing the bill.


Mr. Depuiy Speaker:: 
William Howell Arthur Thomas: Thank you, Mr. Speaker. This matter is somewhat technical. I have tried to condense what I have to say into as few words as possible, so I ask the indulgence of the house to stick closely to my notes.
This bill, No. C-27, was first introduced in the session of 1962. It was debated on February 9, 1962, and is reported on pages 742749 of Hansard for that date. As often happens with private members' bills, time ran
Railway Act
out before a decision was reached. The purpose of this bill is to provide the board of transport commissioners with both the authority and the responsibility for setting forth the conditions under which any railway line may be abandoned. I believe my remarks cover in a general way the argument raised by the hon. member for Rosedale (Mr. Macdonald). I am quite familiar with the argument, and without referring specifically to what he has said I think what I propose as I go along will cover his argument.
The MacPherson commission has forecast the abandonment of 8,000 miles of uneconomic railway branch lines in Canada. Lack of patronage indicates that these lines are no longer required. These branch lines served a pressing need in the days of horse-drawn vehicles 50 years ago, but they cannot possibly compete with the modern motor transport, for either short haul passenger service or freight service. On the grounds of economy they should be abandoned, but the government through the board of transport commissioners should accept responsibility for the manner in which abandonment takes place.
Many interests are involved. There is displacement of labour; new jobs must be found; business is disrupted; rail-tied investments are sometimes jeopardized, agricultural delivery points are eliminated, and there are problems connected with the rehabilitation of the abandoned right of way. It was to this that the hon. member for Rosedale made special reference. Abandonment can be carried out as an orderly transition for the community if it is done in an orderly manner. If left unplanned and uncontrolled, abandonment can become for many of the people involved a very disagreeable experience.
As a good instance of unplanned and uncontrolled abandonment, I would draw attention to the developments following the abandonment of the Courtright branch of the New York Central railway, in 1960, which extends from St. Thomas westwards through the counties of Lambton, Middlesex and Elgin. Train service had almost disappeared from the line. Business disruption was slight, but the abandoned right of way created serious and very irritating problems. The rails and ties and any useful culverts remaining were torn out, leaving an unsightly mess. The fences which had been neglected for some years, pending abandonment, were left in deplorable condition and resulted in a livestock nuisance. The right of way subsequently grew up to brush, burdocks, thistles and an inglorious assortment of all noxious weeds known to the district.
Railways are always a nuisance in farm areas because almost invariably they divide

Railway Act
farm lots into awkward areas. While the railway continues to operate, this inconvenience is ameliorated by properly maintained fences, gates and grade crossings. When abandonment takes place the crossings are torn out, the gates and fences are left in useless shape and the right of way becomes an unrestricted multiplying ground for noxious weed seeds. The New York Central right of way has now been sold en bloc to private speculators who have proved very difficult to contact. The county seed inspector has this year been unable to get action on the weeds. This right of way has become an eyesore, a nuisance and a menace to the community.
For further details of the tribulations and frustrations encountered by the people along this abandoned railway, may I refer hon. members to the debate of February 9, 1962. These difficulties are continuing. No one seems to know or care about cleaning up this mess. Surely the members of this house do not wish this most unsatisfactory experience to be repeated in other parts of the country. Although the difficulties in this New York Central case were not connected with rail-tied investments, grain storage, or alternate transport facilities to the same extent as they might be in other cases of abandonment, these problems of field separation, fencing, drainage and weed control are both irritating and unnecessary.
This parliament has set up a number of planning boards to help avoid confusion and mistakes in our future development. Surely we are justified in giving the most careful consideration to some form of planning and regulation which might help to smooth out the process of railway abandonment.
The Railway Act occupies 203 pages of the Revised Statutes of Canada, 1952. It was passed in its original form when railway construction began, and was intended to protect the interests of all concerned, both under conditions of construction and of operation. It has been amended from time to time to meet changing requirements. Railway abandonment now makes further amendment a prime necessity.
The Railway Act provides for a board of transport commissioners to administer the act. This transport board has authority over all aspects of railway construction and operation. It can grant permission for a company to abandon a railway line but holds itself bound by a judgment re Cairns Brothers, written by chief commissioner Guthrie, November 17, 1936, which rules that the board has no jurisdiction over abandoned rights of way. This judgment was read into Hansard for Feb. 9, 1962. Once the rail lines are torn out, the board's jurisdiction over a right of way ends. The board has no right to enforce conditions

for abandonment. This bill, as previously stated, aims to provide the board of transport commissioners with both the authority and the responsibility for setting forth the conditions under which any railway abandonment may take place.
I suggest that one of the conditions for abandonment should be the appointment of a planning board representative of the various interests which will be affected. Such a board should have on it representatives of the railway company, labour unions, agriculture and the municipalities concerned. The board should have the responsibility of recommending to the transport board the conditions under which abandonment could be permitted. Its recommendations should concern the best disposition of the right of way in the public interest, the disposition of the workers involved, consideration of compensation for rail-tied investment, and any other matters of vital public concern.
Where the right of way separates farm lands, the right of way should be restored wherever practicable to the farm lot from which the land was originally taken. This would eliminate the nuisance of having parts of farms separated from each other. It would permit the farmer in each case to reincorporate the right of way to the best possible advantage in his farm, and to control drainage and the weed menace. Larger areas of property, such as those in town sites, should be disposed of in the best public interest after consultation with the municipalities concerned.
It is proposed that whenever an application for abandonment is granted by the transport board, a waiting period should be allowed in which such a representative planning board as suggested could prepare a plan for abandonment. Provision might be made in such a plan for settlement of disputes by arbitration. The services of municipal and provincial planning boards should be used where available. Conservation authorities at various levels of government should also be consulted. These unnecessary railway lines have served their day and generation well. There is no sound reason why we should now abandon them in such a way as to leave ghost towns, broken fortunes and unsightly scars across the face of our country.
I recommend this bill for hon. members' consideration and for the consideration of the government.


Mr. J. J. Greene (Renfrew South):: Mr. Speaker, may I, first of all, commend the sponsor of the bill before us. I think this measure is certainly a step in the right direction. The railways themselves, as well as the parliament which aids and abets them in making these abandonments possible, sometimes forget the history of railroading in this

country. I think it should be remembered, when we are considering the issue of rail abandonment, that these same companies which are today seeking so industriously to abandon these lines for purely economic reasons, completely ignoring any social implications in the areas concerned, were at one time equally solicitous about procuring from the government of this country monopolies to run these lines.
I would remind the house that these railways were granted something which belonged exclusively to the people of Canada, namely monopolies to run lines, exclusive of other competition, in many cases, in the areas affected. I do not wish to introduce any political aspect into this discussion because there has been enough politicking in this house since the beginning of the twenty sixth parliament; but we know that some companies were granted considerable property, mining and mineral rights, and so on, belonging to the people of Canada, in consideration of building the railways. I think it should be remembered that the companies sought these exclusive monopolies from the people of Canada and used them for profit and considerable gain for many, many years. It is singular that when the cream was flowing the railways did not come and tell us how much cream they were getting from these lines. But when the cream got a little thin, and, in some cases, turned to skimmed milk, they came crying back to the people of Canada through the board of transport commissioners and, just as quickly as they could, they tried to get rid of those responsibilities which they had sought in the first place.
I have attended some of the hearings before the board of transport commissioners and, of course, the last thing the railways are concerned about at these hearings is the effect of rail abandonment on the social and economic life of the areas concerned. In fact, they will say promptly that this is not a pertinent issue. In my particular constituency, the west end of the great riding of Renfrew South was at one time a booming and thriving lumbering area. Of late years the prosperity of that area has suffered very considerably by reason of the depletion of the timber limits. As a result the railways did not make quite as much money there as they would like to make. They have been successful in the past few years in abandoning several of these lines and are now in the process of attempting to abandon the last line, the last avenue stretching by rail from the capital of Canada to one of Canada's great national resources, Algonquin park.
They now want to tear up the line between Barrys Bay and Whitney which will cut off the last access by rail between Canada's cap-28902-5-258
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ital and this great national heritage. Their only reason for doing so is that they are not making enough money. I believe that the railways, being vast corporations concerned only with profits and not with the public benefit will, as private corporations often will, do almost anything that is required to gain their ends. On one occasion the unhappy situation developed of the railway consenting to attempt to run a line profitably for a period of a year and if they were not able to do so they were to be permitted then to abandon it.
The municipalities which had opposed abandonment of the line took the word of the railway in good faith and thought they would in fact attempt to refurbish it, provide a better and more efficient service, advertise, and honestly attempt to make the line pay. Such was not our experience. The railway deliberately and as a matter of planned policy set out not to make money in that year, and to do everything as poorly as they possibly could in order that they might come back to the board a year later and say: "There you are; we told you so; we cannot make it pay; we want to abandon the line."
The railways will make no attempt, as businesses in competitive spheres must do, to make these lines pay and to make them effective and efficient. If they decide the line does not make money easily their attitude is: "Let us get rid of it; let us fold it; never mind the effects on the localities and on the people." I suggest that any corporation that has had a monopoly from the people of Canada and has milked it for all it was worth when the cream was good has no right to abandon a line to the detriment of the people in the locality, without making very adequate compensation to the people there for the abandonment of the line.
The hon. member who proposed the bill has taken a step in this direction and, as I said earlier, I think he is to be complimented and highly commended for this step. I wonder whether he has gone far enough. In hearing his well presented and documented speech I wondered whether it would not be advantageous to the people in these areas and more proper, in view of the fact that the railways have used these lines which were very largely granted from the public domain, if the railway when it wished to abandon a line would have to return the right of way to the public domain. I wonder how many applications for railway line abandonment we would have if the railways were told: "That is fine; you can abandon the line if it is in the public interest of the locality, but if you do so any land-"

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Mr. Clancy:: May I ask the hon. member a question? He should know the law. If he will look up the statutes he will find that if a line is abandoned it is already set out in the law who owns the land and also who gets the mineral rights.


John James Greene: Mr. Speaker, I am not quite aware whether the hon. member-


Gordon Drummond Clancy: You have the same statutes I have.


John James Greene: If the hon. member was giving me information I thank him for it. I was not aware of that situation in respect of the mineral rights. I am aware of the fact that the freehold on these lines remains vested in the railway in perpetuity if they wish to keep it that way, whether or not they abandon the line. My hon. friend has instructed me that the mineral rights revert in some fashion. If this is so I was not aware of it. What I say is subject to what may be the case in the western provinces where the law in respect of minerals is different from that in Ontario. To the best of my knowledge the mineral rights remain vested in the railway whether or not they abandon the line. I stand to be corrected in this regard, but this is my impression. I suggest that this is neither right nor proper. The railways should have to make a decision. If they wish to abandon lines because they are not making enough money they should have to decide to give the land back either to the abutting owners or to the municipalities or the province concerned. Surely they should not be able to render no service, do as they like with the line and then leave people without any rights either municipally or provincially with regard to the line.
My hon. friend has taken one step in the right direction but I suggest with the greatest respect that we should go a great deal farther. I suggest that the railways should not be permitted to play fast and loose with the rights of the people as they have been doing to date with regard to the abandonment of lines. In the west end of my riding, which I spoke of earlier, this is a matter of very great concern to my people. It was one of the first, areas of this great province to be opened up. I have a great deal of sympathy with hon. gentlemen opposite who from time to time have propounded policies for the opening up and development of Canada's north, but I must admit that I have also had some misgivings. I have seen so many areas such as the west end of the riding I represent which have been opened up for many years, in this instance an area close to the capital of Canada itself, and which have been neglected and forgotten over the years. This area was used as long as the timber resources existed, and then it was abandoned to the point that today

even the railways are getting out. In some measure it seems to me a contradiction to talk about the building of roads to resources and developing our great north when in some of the oldest settled parts of the country, such as the riding I represent, there has been so little development and apparently so little concern by any government of any stamp about the fact that the area has been left forgotten, neglected and undeveloped.
Believe me, in the area to which I have referred lack of opportunity has made itself felt not only in one generation but in two and three. There are no schools there, even at the elementary level to compare with the schools that exist in more urban municipalities, because there is no assessment, industrial or residential, on which to found a proper school system.
The lack of opportunity, therefore, is widespread in an area such as this. These people have been living now for some generations in the hope that at some time the pendulum would swing the other way, and that the days they knew when pine was in its prime would return by way of industry. In this way, new opportunities would be created. The railways went into this area very early in order to make profits when the pine was moving, and when they see even the railway pulling out it is a symbol to them that perhaps even the government of this country has given up hope.
I suggest that at these hearings before the board of transport commissioners, the only issue is public convenience and necessity. Of course, the financial statements of the railway are important. How many dollars are they losing; that is of great concern to the board of transport commissioners. As I said earlier, the railways are very adept at making up financial statements which indicate they are losing money. They are very slow and remiss in doing those difficult things that are needed to make the railways in these poor areas a little more prosperous. The railways just want the lush pastures. They want to leave the tough parts to the buses. This is the attitude of the railways. Well, the financial statements are pertinent.
Is there some other means of transportation? This is pertinent to the inquiry by the board of transport commissioners, and is called public convenience and necessity. However, there is very little else that is pertinent. It is not relevant to know how many dollars this railway made on this line before they decided to pull out. The board does not want to hear about that. They just want the picture now. The board does not want to hear whether this railway will provide a means of access for future industrial or tourist development. Again we in South

Renfrew know that one of our faint hopes lies in the growth of the tourist industry. We do not have the ready access to the area we should have to make that possible. When the railways are removed, there is just one other means of access that no longer exists which would help us to develop the tourist industry.
Surely, at the very least, it should be a relevant issue before the board of transport commissioners, whether or not the removal of the railway will impair the future economic growth of the area. To the best of my knowledge, this is not a pertinent question and this parliament must be held responsible for that. If these issues are not relevant in these hearings for abandonment, then the ultimate responsibility rests in this parliament which makes the laws governing the operation of the board of transport commissioners.
I suggested, Mr. Speaker, that this entire problem of railway abandonment should be given another look to ensure that these powerful concerns which in the past have made great profits on these lines should not be allowed to abandon them at the first signs of the end of the easy money. The railways should be made to sincerely attempt to make these lines pay. I recall very distinctly that at one of these hearings where we were striving on behalf of the local municipalities to have the line kept open, a witness on behalf of the railway was asked, "what have you done to make your service attractive so the people will use it, so that you would not be coming here with a crying towel trying to abandon this line?" We also asked whether they had advertised their service which, peculiarly enough, is something that is very necessary in modem business. We were given this answer. "We do not have to advertise; everybody knows where the station is." This answer illustrates how efficient, how up to date the railways are. This indicates how concerned they are about seeing to it that these marginal lines make a profit so that they can be maintained to serve the areas they are supposed to serve.
No, Mr. Speaker, it is my firm belief that the railways do not wish to make any attempt to maintain lines, except in those areas where the profits are lush and easy. If the maintenance of the line is going to be difficult, if it is going to take imaginative management, if it is going to take the kind of business acumen that every little businessman has to have to survive today, then the railways say, "it is too tough; we want to pull out". Let somebody else do it. While this bill goes some distance towards making the railways fulfil their responsibilities to
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the people they are abandoning, it should go a great deal farther. At the very least, if the railways pull out, the entire line and the resources, mineral and otherwise below it, should be returned to the public domain. Then, let us see how many lines the railways will want to abandon.


Mr. G. H. Aiken (Parry Sound-Muskoka):: I only want to say a few words in connection with this bill, Mr. Speaker, and to move an amendment at the conclusion of my remarks. The hon. member for Middlesex West (Mr. Thomas) has raised a very important matter which I believe is going to become more and more of a problem as time goes on. The railways have apparently come to the conclusion that they must abandon certain lines that are not paying. We have to face the probability and possibility that in the future this problem will become even more acute than it is now. The hon. member for Rosedale (Mr. Macdonald) raised a matter that merits very serious consideration. If we can assume that he has indicated the viewpoint of the government, then there is some question about the validity of this type of legislation. We ought to have this question of validity investigated.
This bill has been before the house on other occasions, and will probably be before the house on future occasions. I hope that each time it comes up the question of its validity will not cloud the issue of the appropriateness of the legislation. One point I should like to raise in connection with validity. There is a very well known maxim in common law relative to highways which is to the effect, once a highway always a highway. I would think this maxim could apply equally to railroads. It might very well be that if the Supreme Court of Canada had to consider whether or not this particular maxim would apply to railway land, under these circumstances it would come to the conclusion that the railway is and remains a federal railway, and within the legislative competence of the parliament of Canada.
For these reasons, Mr. Speaker, I would like to move seconded by the hon. member for Rosthern (Mr. Nasserden):
That Bill C-27 be not now read a second time but that the Minister of Justice be directed to refer the subject matter thereof to the Supreme Court of Canada for an opinion on the validity thereof.
I may say that just a few minutes ago I gave a copy of this motion to the Minister of Transport, who is interested in this particular bill.


The Acting Speaker (Mr. Batten):: Shall the motion carry?


Donald Stovel Macdonald: Mr. Speaker,

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if I could just refer to a few remarks made by the hon. member for Parry Sound-Muskoka (Mr. Aiken) I would like to make it clear to the house that the remarks I made at the start of this hour were remarks made by me in my personal capacity as a member of the bar, and with doubts as to the constitutional validity of consideration of this question by parliament. They did not represent the policy of the government.
I would say that while I at that time raised some question as to the constitutional validity, I would like, if I might, just to refer to some of the merits underlying the question of constitutional validity, and to refer to the merits which presumably motivated the drafters of our constitution to consider this question and deal with it in this way. It was the intention of the drafters of the British North America Act to place matters of purely local and private nature within the jurisdiction of the provincial governments.
I do not disagree at all with the concern expressed by the hon. member for Middlesex West (Mr. Thomas) with regard to the fact that a piece of industrial wasteland may have been created, nor do I disagree with the remarks made by the hon. member for Renfrew South (Mr. Greene) that the particular railway should not be able, without any financial cost, merely to abandon the line and let it lie. But the point I was making is that this should be governed by the local planning authority. The jurisdiction over this should be exercised by local people who make plans for the use of real property within a particular community. What I am saying in connection with land which is purely the land of a particular locality, is that the locality should decide. The people should not have to come to Ottawa. They should not be forced to the expense of coming to the board of transport commissioners to say how the land is going to be used.
From a legal standpoint this question is amply clear for the reasons I have cited. We have already got pronouncements of the judicial committee of the privy council with respect to jurisdiction over land declared to be for the general advantage of Canada. We have the clear statement of the board of transport commissioners, a statement of law on which appeal was available, but upon which no appeal has been taken, that in fact the land has ceased to be part of the railway operation.
With regard to the maxim, once a highway always a highway, applying here, as argued by the hon. member for Parry Sound-Muskoka, I would point out that the chief purpose of that particular maxim is to assert the fact that it does remain in the public domain. There is no question here as to the

ultimate ownership of the land. It remains clearly the property in fee simple of the company, but the real question here is the manner in which it is being used.
The parliament of Canada, under the Railway Act, has conferred on the board of transport commissioners the power to decree the manner in which land shall be used when devoted for the purposes of a railway. When land has been abandoned with the consent of the board of transport commissioners and in accordance with due process of law, then that land has ceased to be within the jurisdiction of the parliament of Canada; and that proposition, as I pointed out to Your Honour at the beginning of this hour, has been amply confirmed by the judicial committee of the privy council, and has been amply confirmed by the body which, under the law of Canada, has chief jurisdiction over questions of law arising in connection with railway matters.
It is not so much a question of whether something should be done about this problem created for a community, when industrial wasteland exists after railroad tracks are torn up. I agree it is not that question, but the question is by whom should it be done?
I would submit to the house that this question has already been decided fully by the British North America Act, and interpreted as such by the appropriate courts of the land -that the jurisdiction in this respect where land has been abandoned by approval of the board of transport commissioners, rests entirely with the provincial governments, and through the provincial governments in their creations, the local planning authorities, or in the appropriate case in the provincial departments of municipal affairs.
For that reason I do not feel it would be useful putting the crown to the expense of getting an opinion from the Supreme Court of Canada on a question which is eminently clear. What I do suggest is that the very commendable efforts of my hon. friends from Middlesex West and Renfrew South should be directed to the provincial authorities, and it is for them to take action to impose upon the local planning authority the jurisdiction and power to make orders for railway companies with regard to the proper, convenient and socially acceptable use for lands formerly devoted to railway purposes. Mr. Speaker, may I call it six o'clock?


The Acting Speaker (Mr. Batten):: Order. I must advise the house the time for the consideration of private members' business has now expired. Before calling it six o'clock maybe the house would agree to go into committee of supply in preparation for the business that is for consideration at seven o'clock.


The house in committee of supply, Mr. Batten in the chair.
At six o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 7 p.m.
Lucien Lamoureux: Order. House again in committee of supply, on the estimates of the Department of Justice, vote No. 1.



DEPARTMENT OF JUSTICE

[Stage Direction]
1. Departmental administration including grants and contributions as detailed in the estimates, $1,378,100.
Lucien Lamoureux: Shall this vote carry?


Lester Bowles Pearson: Mr. Chairman, I know it is unusual for the head of the government to speak on the introduction of the estimates, on item 1, which initiates a general discussion. I do so on this occasion because I want to take advantage of the opportunity to make a brief statement concerning some changes that have been introduced in policy and procedures relating to the security of the operations of government and of the defence services. The fact that I am doing it-and I will be followed by the Minister of Justice-is, I hope, an indication of the seriousness which the government attaches to this problem, the importance which we attach to it and my own interest, as the head of the government, in it.
Security is one of those things that is essential and, at the same time and in some respects, rather distasteful. I think we would all prefer if we could ignore the necessity of security and do away with the procedures and precautions it imposes upon us. Unfortunately, Mr. Chairman, we cannot; we have no immunity from this responsibility. While we in Canada have not had for some years a sharp and immediate shock in the exposure of espionage, that does not mean the threat has vanished or that the necessity to meet it has diminished. We have had ample evidence both here and in allied, friendly countries-recent evidence-that security is as important a matter today as it has ever been.
It is still the responsibility of government to ensure that every reasonable precaution is taken to protect the security of the nation in all its aspects. The security which I am talking about tonight-and it is only one aspect of security

and which must be provided is of two kinds. First, the government must ensure the physical safety of the secret, classified information for which it is responsible by devising effective regulations for its
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proper handling and proper storage. However, physical security is in itself of little use without the added assurance that the people handling the material in question are people in whom government can have full confidence. It is in this area of personnel security that most of our difficulties lie, in which government responsibility is, I think, heaviest and perhaps most difficult to discharge. An important phase of that responsibility is to ensure that the protection of our security does not by its nature or by its conduct undermine those human rights and freedoms to which our democratic institutions are dedicated.
If our security policies ignored, or did not take sufficiently into account, the basic rights of the individual, they could operate not to defend but to destroy the liberties which are our first concern. The reconciliation of these competing responsibilities and these competing obligations is not easy. Governments in this country, in the United Kingdom, the United States, France and in free countries everywhere have wrestled, and indeed are wrestling, with this problem. There is no perfect solution to it; there is no perfect answer to it. There is no solution that does not entail some risks, risks to security or risks to individual rights, or risks to both.
Mr. Chairman, there have been recent expressions of concern in this House of Commons and elsewhere, not so much about the adequacy or, if you like, effectiveness of our defence security measures as about the fairness and justice to the individual citizens concerned. I recognize, as I am sure all hon. members of the house recognize, that concern and find it reassuring and, indeed, gratifying.
Let me make it quite clear, Mr. Chairman, that the concern which has been expressed about this matter is fully shared by this government, as I believe it was fully shared by those responsible for government in the past. The security measures which have been developed here in Canada, through sometimes bitter experience, are intended to be preventive and not punitive. Their purpose is to protect the safety, interests and indeed the freedoms of all Canadians. They are under constant and continuous review, with the purpose of striking the balance I have referred to between the protection of the state and the protection of the individuals who, in a free society, alone give the state its direction, its purpose and indeed its meaning.
Since they were introduced in this country in 1947, the so-called security screening procedures adopted have, on the whole, worked well, though of course, Mr. Chairman, there have been mistakes. But I believe we have for the most part avoided excesses both of over-caution and over-confidence. There are nevertheless admittedly certain flaws in

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the system and it is to these that the government has been directing its attention recently. It is also to these that members have been addressing questions to the government in the House of Commons.
It has been suggested that our security system might be better served by the establishment of a quasi-judicial tribunal to which persons who had been denied employment in government or dismissed from government employment for security reasons might have a right of appeal against that decision. This proposal has been given intensive study by various Canadian administrations over a number of years and the conclusion invariably arrived at has been essentially this: quasijudicial procedures cannot fairly and effectively be applied to these matters. By the very nature of the security risk and the measures which have to be taken to try to meet that risk, it is often impossible to bring forward for open scrutiny all of the relevant information in any particular case. To some degree the consideration of employee security in the consideration of this problem in judicial or in legal terms beclouds rather than clarifies the issue.
No lawyer thinks of judicial procedures and the canons of evidence when he decides to trust a secretary with private or secret papers. Confidence is not the kind of thing which is always capable of determination by concrete or specific evidence. It may depend on many things-the record of a man, his character and his habits, the nature of his activities, the stability of his personality, the company he keeps, and the pressures to which he may be susceptible. Judgments of character and confidence are important in private affairs; they become far more important when the security of a nation is at stake. But they are not, however, different in their essential nature. Every minister and agency of government is accountable for the security of their operations. Consequently, each must be responsible for the reliability of the people to whom it gives access to the things on which national security may depend.
The granting or the denial of a security clearance is an administrative matter, one of managerial responsibility. In making a decision that an applicant or employee may not safely be given access to secret and confidential information, the head of a department or of an agency is not denying an individual a right. No person, of course, has a right to see official secrets. The department head is merely exercising the judgment he is expected to apply on the basis of all the information available to him in the way that any sensible person would exercise such judgment in hiring a secretary, a cashier, a lawyer or a doctor, ensuring that such per-

son could be trusted with his property, his private business or his physical health. The government also has an obligation to provide itself with every reasonable assurance that those of its employees who require access to the government's, the nation's secrets are loyal and trustworthy and not vulnerable to persuasion, coercion or blackmail.
While it is the responsibility of departments and ministers to take the ultimate decision on the security of their personnel, this is of course done within directions as to policy laid down by the government. The question has arisen whether it might be desirable to have some procedure for a hearing or a rehearing of employees, short of a judicial or quasi-judicial procedure, which would ensure that their side of a case was fairly heard. The United Kingdom and the United States do have such procedures, while they leave the final decision to the agencies involved. So far in Canada we have not had these procedures.
After careful consideration the government has come to the conclusion that the essential advantages of these procedures can be achieved within our system by requiring all departments and agencies of government to do two things which they have not previously been required to do. The first of the new requirements is to inform the person involved when his security or reliability is in doubt and may have to involve his dismissal. Employing departments and agencies will in future be required to tell an employee everything that is possible of the reasons for the doubt, if there is a doubt, and to give him an opportunity to resolve that doubt. This practice has been followed in several departments and agencies of the government for many years, and often with very good results, but it has not been mandatory. There will, of course, Mr. Chairman, be cases, which I think will be few in number, in which the sources of the information giving rise to doubt are such that little or nothing can be told the employee of the reasons for doubt without jeopardizing the sources from which the information comes. In these cases, which will, I repeat, be few in number, there will be an added responsibility to exercise the greatest care to ensure that the employee does not suffer unfairly.
The second new requirement is to ensure that a second look is always taken by a separate body before dismissal is finally decided upon. Once the individual is told of security doubts he will have the opportunity to give his side of the case. The employing agency will consider it, consult the staff of the government security panel, and arrive at a conclusion. It may be to accept the person as reliable, in which case no problem arises.

It may be to transfer him to a less sensitive employment, as has been the case certainly more than once in the past, where he would not have access to secret and confidential material. But if it is that his dismissal must be recommended, the individual will be given a second hearing, this time by the deputy minister or head of the agency. If that interview does not resolve the doubts, and if the agency head agrees with the view that dismissal is necessary, the whole case and the relevant information, including anything that the employee himself has submitted, will be submitted to a board of review.
At this point, Mr. Chairman, I would like to say something about the government's advisory agency on security policy. This agency, which has been in operation now for a good many years, is called the security panel. It is composed of senior officers, mostly of deputy minister rank, who have had years of responsibility and experience in the personnel and administrative fields. Security is not their main or sole responsibility. Advice on policy in this area has to be based not on security alone but on a broad understanding of the nature of our democratic institutions and principles, on the policies of government, on the requirements of administration, and finally, and importantly, on the needs of security.
The government has decided that the board of review to which I have referred should be drawn from the members of the security panel. In all cases they will be men who have not been involved in the particular case. They will come to it without bias or preconception. There is no question at all in my mind but that they will provide as fair, humane and sound an evaluation of every case as can be provided in this difficult field.
The board of review will provide its views on each case where dismissal is recommended. It will then be for the responsible minister, in the light of all the information and study, to decide whether or not to recommend dismissal to the governor in council.
I think, Mr. Speaker, that these procedures are as painstaking and thorough as can be devised to ensure the protection both of the safety of essential classified government information and of the welfare and rights of the employee.
A most difficult aspect of security, and one which has always been a matter of concern, is the necessity of taking into account the character and activities of an employee's immediate relatives, or their places of residence. The question has often and properly been asked: Why should a man be denied a security clearance because his father, his uncle, or even his estranged wife, may have
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been engaged in subversive activity, or may be an active communist? It is not the kind of relationship, whether by blood, marriage or friendship, which is of primary concern. It is its closeness in degree and the circumstances surrounding it in respect of the nature of the job, most particularly the extent of influence that might be exerted, which must dictate a judgment as to a person's reliability. And reliability, of course, is something more than loyalty. It is usually very difficult to establish this, but that does not remove the need of trying to do so.
The collective experience of all nations of the western alliance agrees on the necessity of exploring these difficult matters and arriving at a considered judgment. This experience also shows that security may be in danger if a person in sensitive employment has a mother, father or other close relative behind the iron curtain. Human emotions cannot be expected to be proof against the possible anguish of a loved one-and the brutal fact is that such anguish may be imposed by those who are ruthless in getting, or trying to get, what they want. These are harsh and unpleasant facts, but they do not go away if we pretend that they do not exist.
I feel confident that the procedures which we are now adopting will assist us in making judgments concerning loyalty and reliability in a manner which will protect individual rights as well as national interests.
In making this statement, I hope I have contributed to a better understanding of the principles and issues involved in this aspect of national security, and the means by which we endeavour to preserve it and discharge our responsibility in government.
I have necessarily spoken in general terms, but if the committee would agree-and I know this is an unusual procedure-my colleague the Minister of Justice could follow me and fill in some of the details.


John George Diefenbaker: If you let me precede the hon. gentleman, he could answer me and then the detail could be set out.


Lionel Chevrier: The statement I have to make follows upon that which the Prime Minister has just made and, if I might have the permission of the committee to do so, I should like to make it now. If it were separated from the speech which has just been made, I think the effect would be spoiled.


Lucien Lamoureux: Is that agreeable?


Some hon. Members:: Agreed.


Lionel Chevrier: I wish to say at the outset that I think this is a rare occasion, one of the few occasions which I have seen, at least, in

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my long years in the House of Commons upon which the Prime Minister makes a statement on the estimates of another minister. I am not saying it has not been done before. I am simply saying it is a rare occasion and it underlines the importance which the Prime Minister and those who sit on this side of the house attach to this subject.
The committee may remember that the hon. member for Burnaby-Coquitlam brought to my attention, and to the attention of the government, the procedure which was being followed by the Department of Justice and other departments with reference to this matter and I agreed to give the subject consideration, along with my colleagues. I believe the hon. gentleman, together with his hon. friends, thought that this consideration was taking too long but I am sure he will have realized this evening at once, not only by the statement which the Prime Minister has made but by the statement I am about to make, that this is a question which has to be considered in all its aspects, aspects which affect every department and agency of government. That is why a decision with reference to the procedure to be adopted in future has not been reached until now.
I would like at this juncture to make a more detailed statement concerning national security within the context of the statement on security policy by the Prime Minister. In light of the many recent expressions of interest in the means by which the government of Canada protects her secrets and those of her allies entrusted to her, and in light of continuing indications, here and elsewhere, that the need for such protection not only continues but continues to grow, I welcome this opportunity to contribute to a clearer understanding by the people of Canada of the issues involved in this vital, although often misunderstood area of human activity.
I need hardly remind this house of the dangers of permitting information about our defences, the defences of the western alliance or other matters essential to our security to fall into unfriendly hands. I need scarcely recall what happened many years back when certain matters were discussed here and outside. We know that there have been, over the years, undeniably effective efforts of espionage in Canada, in the United States, in the United Kingdom, elsewhere in the democratic countries of the west, and, indeed, through the world.
All the countries of the west know that in addition to the professional agents, a very effective group in securing and passing on vital and secret information are open or clandestine sympathizers with the communist ideology. In their minds they have another- perhaps they think a much higher-loyalty.
[Mr. Chevrier.l
In any event, there is no doubt but that they play a major role in securing information that others want for purposes unfriendly to our objectives.
Apart from the use of such allies or sympathizers, one of espionage's most effective tools has always been the exploitation of human vulnerability, whether of the body or of the mind. In recent years there has been a frightening concentration on the exploitation of human failings to achieve the ends of offensive intelligence. Any evidence of exploitable weakness, whether it be greed, lust, dishonesty or plain stupidity, is carefully documented and may be carefully nurtured. Eventually, through the patient accumulation of compromising evidence, or simply through a veiled threat that a relative may have some difficulty with the police, it is possible for an intelligence agent to apply pressures which may prove intolerable unless co-operation is forthcoming. If it is not, the evidence, whether it is real or concocted or both, is sent anonymously to employers, relatives and friends, often with the result that a promising career is ruined, not to speak of the personal effect on the individual himself.
Should there be any doubt in anyone's mind, let me say at once that these things have happened to Canadians, as we all know, and will probably happen again. For obvious reasons I do not propose to go further into this matter, but I should like it clearly understood that, for reasons such as I have given, the defensive security measures which have been developed over the years are intended not only to protect our secrets but to protect the individuals who, in having access to them, are thus automatically potential targets for ruthless attacks of the kind I have described.
I should like now to say something about the security screening arrangements which have been devised to prevent espionage, as distinct from those intended to anticipate and control subversive activities generally. I do so with some reluctance because the effectiveness of even these measures is usually reduced in providing information about them. At the same time, I fully appreciate how frustrating it is to members of this house as well as to the public generally, who are rightly concerned that individuals be treated fairly, to be faced with official silence on this vital subject. There will always be matters in this area which cannot be discussed fully in public if our defensive arrangements are to have any effect at all. I am sure all members of the house will agree with the principle of that statement. On the other hand, the effectiveness of these arrangements does not depend solely upon the measures or the individuals involved with them. They depend too upon the understanding and co-operation of all Canadians on

whose behalf, in the last analysis, these measures have been instituted.
In many ways the secrecy which tends to surround defensive security measures has clouded the homely fact that these measures are essentially a part of good personnel administration. As the Prime Minister pointed out a moment ago, the purpose of our security program is preventive, not punitive. In deciding whether it can have sufficient confidence in an employee to trust him with its secrets, the government is not deciding whether or not he is guilty of anything nor is it dealing with a person's rights as a human being. No one has a right, and I emphasize that, to have access to secret information any more than he has a right to be someone's trusted private secretary. The employer has a right, indeed in most cases a duty, to entrust his secrets and give his confidence only to a person whom he can trust. In withholding that trust he does not infringe the rights of such a person nor accuse him of a crime. Some inference of untrustworthiness in such a case may be implied or conveyed privately. In some cases, as a very last resort, it may have to become public. In all cases, however, the essential question is simply whether an employee can be relied upon in a position of confidence.
Each department and agency of the government is responsible for the safekeeping of the secret information it holds and must administer, and is therefore required by direction of the government to establish beyond reasonable doubt the loyalty and reliability of its employees who have or may readily obtain access to such secret information.
In the first instance, such employees are asked to provide certain basic information about themselves and about close relatives who may influence them or cause them to be influenced in a manner which would bear on their loyalty or reliability. They are also asked now to give the names of persons as character references. This basic information is provided through the completion by the employee or prospective employee of what is called a personal history form. I might add here that this form, which over the years has been subject to revision in the light of growing experience, has recently been reviewed and revised by the various officers in order to establish loyalty and reliability through future and further investigation. In addition, the employee is required to be fingerprinted in order to determine through a comparison with the central fingerprint records of the Royal Canadian Mounted Police whether he has any record of criminal activity of a nature which would bear on a judgment as to his reliability. If there is no such record, 28902-5-259
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the fingerprints may be returned to the employee at his request.
Next, the completed personal history form is forwarded by the department or agency to the Royal Canadian Mounted Police with a request that it be checked against their records to determine whether there has been any indication of participation in communist or fascist organizations or association with persons suspected of espionage. In some cases a further request is made that the Royal Canadian Mounted Police conduct a detailed investigation of the background of the employee concerned. This necessarily involves conversations with former employers and others who can be expected to be able to assist in judging the trustworthiness of the individual in question.
In providing the results of these investigations to the requesting department or agency the Royal Canadian Mounted Police make no comment-I should like to bring this particularly to the attention of the house-give no opinion and come to no conclusions to be drawn from the information which they provide and give to the department or agency. They simply pass it on with any assessment they can give as to the reliability of the sources of the information. The conclusions as to the relevance of that information and the weight to be given it in light of all the circumstances are solely the responsibility of the employing department or agency and the minister in charge of it.
I should like to emphasize this as it appears to be an unfortunate misconception on the part of many Canadians, both in this house and elsewhere, that the Royal Canadian Mounted Police proffer or are asked for advice or opinions concerning the significance of the information they are asked to provide. In fact, quite the opposite is true, and the Royal Canadian Mounted Police have taken extreme care not to interfere in any way with the formulation of a decision, which is the heavy responsibility of the employing department or agency. Advice in arriving at decisions is available to departments through the interdepartmental security panel, and the Prime Minister has given some information on that panel.
I said a moment ago that the responsibility of arriving at a decision as to an employee's suitability to be given access to secrets was indeed a very heavy responsibility. This is so because the senior officers concerned, and eventually the minister responsible, must ensure that a proper balance is struck between the safety of vital information on one hand and the fair and just treatment of the individual concerned on the other. It is in the making of this decision and in its consequences that the difficulties and dangers lie.

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A wrong or hasty or ill-informed conclusion may result in a serious loss of vital information. It may result in a Canadian government employee, his family or his friends, being subjected to intolerable pressures, even though none of them may be seriously at fault and the ruination of careers and reputations through the actions of unfriendly intelligence services. On the other hand, it may result in an able, loyal and trustworthy Canadian being denied an opportunity to serve his country in a position or calling of his own choice. These are some of the possible consequences of an unwise or incorrect decision. It is because the consequences can be so serious that the government has decided to introduce changes such as the Prime Minister referred to earlier. These are changes designed to make more certain that the individual has every opportunity consistent with security itself to give his side of the case. This he did not have an opportunity to do before. Now, he will have this opportunity, not once but twice. He will be assured in future of a chance to present all considerations to the permanent head of his department or agency personally. After that, to be sure that no point has been missed and no misinterpretation given, a board of review drawn from the security panel will re-examine the case. In the last analysis, however, the decision whether to recommend dismissal will be that of the responsible minister.
The new and carefully devised procedures will improve our measures and give a new assurance to individual employees. They will not, however, mean that dismissals will not be necessary in some cases in the future as in the past. When they are necessary, however, every attempt will be made to treat problems of unsuitability on grounds of security or reliability in the same way as other problems of personnel management are treated. Departments will do their best to hold in strict confidence the information they get concerning individuals, and to take any action necessary in a way that does the least possible damage to reputations and self-respect.
I said a moment ago that the Royal Canadian Mounted Police had been charged with the responsibility of keeping the government informed about subversive activity in Canada. As is well known, the Royal Canadian Mounted Police also carry out, on behalf of the departments and agencies of government, the majority of the background investigations I have referred to of present or prospective government employees who are being considered for appointment to sensitive positions. In performing both of these tasks, the police have been subjected at times to public criticism. Some of this criticism has sprung from the university communities in Canada, who
[Mr. Chevrier.l
have expressed concern over a variety of matters pertaining to security, particularly that our security measures should in no way interfere with the freedom of thought and discussion which is essential to the very purpose of any institution of learning. The government wholeheartedly agrees with this view. In the late summer, the Prime Minister and I had occasion to discuss some of these matters with officials of the Canadian association of university teachers. Those discussions, I believe, contributed to a clearer understanding of the issues involved, and I trust that the statements the Prime Minister and I have made will further add to a better understanding on the part of all interested organizations and individuals of the nature of our security measures and of the reasons for them.
In closing, sir, may I re-emphasize one point? In carrying out their investigative and fact-finding functions in this difficult field, the Royal Canadian Mounted Police do not act upon their own initiative but rather upon instructions from the government of Canada. As a police force in a democratic country, and indeed one of the finest forces in the world, they are at all times accountable, both by law and by tradition, to the government of Canada and through it to this parliament and the people of Canada. They will undoubtedly be criticized in the future, as they have been in the past, for carrying out policies and instructions that the government of the day lays down, within the laws of Canada, as being necessary in the public interest. Mistakes may be made in the future as they have been made in the past. I am certain, however, that so long as these matters are open to public scrutiny and free discussion, we need have no undue concern that essential security measures can deviate far or for long from the principles that are essential to a free and democratic nation. I am equally certain that the Royal Canadian Mounted Police in this, as in other tasks that fall upon them, will do no more than carry out honourably and conscientiously the responsibilities that the government and people of Canada place in their trust.


John George Diefenbaker: Mr. Chairman, the matter under discussion is one of the most difficult problems that faces a government today. It is understandable why the Prime Minister should have made a statement this evening as to the policy of the government, for the responsibility of national security rests primarily on the Prime Minister. In discharging that responsibility, he has the benefit of the assistance of the Minister of Justice and the other agencies connected with that department. I found it somewhat difficult to understand the necessity for the detail into which the Minister of Justice went. Certainly, that

detail did not add very much, except in volume of words, to the statement that was made by the Prime Minister.
In the latter part of his remarks he dealt with the Royal Canadian Mounted Police, which force comes particularly and peculiarly under his direction and control. May I say at once that I have known this force from its earliest days. I knew them on the prairies when they were the North-West Mounted Police. I knew them, as counsel, when they were the Royal Mounted Police. I have known them, of course, in the last years since 1920 when they took unto themselves their present name. It is a force great in its heritage, great in its achievements and great in the contributions that it has made to law and order in Canada. I am one who has a peculiar knowledge in that regard, for over the years I acted in the courts from day to day and had on the witness stand, generally on the other side except when I was prosecuting, members of that force. In the hundreds of cases in which I participated, only in one did I find on the part of any member of that force a departure from the elemental justice which has been characteristic of the force.
These criticisms to which the Minister of Justice has made reference are easily made. The force becomes the object of the attack of the individual against the system which they administer. This has its effect. I hope at all times we, and Canadians as a whole, will have that sense of responsibility and not aim our attacks at the force unless there has been, on their part, an injustice perpetrated by them. In that case the other members of the force are generally the first and most immediate judges.
One of the members of the present house, the hon. member for Athabasca (Mr. Bigg), was for a long time a distinguished member of that force, and his father before him. We have had other members of the force in this house. One was General Pearkes, and each and every one of them have served here as they did in the force, to the honour of their country.
I feel, and I am going to be perfectly frank about it, that having the R.C.M.P. act as traffic officers and the like, in carrying out their duties in urban municipalities, has not been in keeping with the tradition of that force, and has had effects that have not been entirely beneficial to the greatness of it. Having said that, I now want to say a word on the subject of national security.
I began by referring to the responsibilities that rest on the Prime Minister's shoulders. From time to time these matters are brought before the people. He carries in his head information in respect to the subject of security
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that he is almost frightened at times of revealing. The Prime Minister has spoken of the difficulties.
How are you going to maintain security while at the same time preserving and maintaining the fundamental rights of the individual? It is a difficult problem. It is so easy to criticize, but it is so much more difficult, having that responsibility, being desirous of maintaining those freedoms, to be able to carry out one's wishes. Loyalty is expected of all Canadians. It is imperative as a quality of public service.
The maintenance of security is of prime importance to the survival of the state. How often do cases come before a prime minister and he cannot go into the details in the House of Commons. You have the evidence. Often it is secondary evidence; sometimes it is hearsay. The accumulation of hearsay placed before one has an effect, no matter how one endeavours to adopt a judicial attitude.
There are many cases in which the loyalty of the individual is not in question. But that individual may still not be reliable as a security risk, as was stated a moment ago, because of defects in character which subject him to the danger of blackmail. It is in blackmail mainly, not in the greed of the individual as such, that espionage among non-professionals takes place. That was so in the Vassal case in the United Kingdom. It is a fertile field for recruiting by the U.S.S.R., where public servants are known to be the companions of homosexuals. Those are the people who are generally chosen by the U.S.S.R. in recruiting spies who are otherwise loyal people within their countries.
The fear of exposure, the danger that all of us feel that something in our past might be revealed, have a tremendous effect on the mind of the potential spy or the prospective dispenser of security information to the U.S.S.R. The human element is involved. Someone is brought before you who is suspected. He tells his story. If the story is an admission it is generally accompanied by the statement of the individual in question that he meant no wrong, but was acting in selfdefence for the preservation of his reputation. Within our own country, in the time when I was prime minister, I do not recall any case in which the activating reason for participation by the individual was monetary gain. The promise of monetary gain from the U.S.S.R to prospective spies is small indeed. The rewards are small and the dangers are great.
What can be done? The Prime Minister has reviewed this at length and in a dispassionate manner. When the Minister of Justice says this just began with this administration, he forgets we worked on it for

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several years. We endeavoured to bring about a system which primarily would preserve to the highest degree possible the safety and security of the state while maintaining the rights of the individual.
My life has been in that field, in the preservation of the individual's freedom. Mention was made of universities. You come to a point when, if you challenge my right to think as I will, you destroy democracy. Freedom is never the right to do wrong: Freedom is the right to be wrong. In other words, no matter whether I am a minority of one within the state, so long as I keep within the law and do not endeavour to undermine the state by overt acts, I have the right to advocate that thinking. That is one of the reasons that when people spoke about outlawry of communism I stated it could not be outlawed. It could be inlawed; but you cannot outlaw a philosophy unless overt acts foul the thought of the individual. If you start outlawing the right to think, no matter how strongly you feel about that, you place everyone who is associated with the communists in the position where they must prove to the court that they are not communists. When I came into the House of Commons we had as a member here one who was afterwards convicted of espionage, a communist. If we had had a law outlawing communists, everyone in this House of Commons at that time would have had to prove that, having been associated with this man, they had not suffered from communism osmosis in consequence. That is the danger of these short cuts.
It would be easy to be critical of the plan that is offered this evening. I believe, on the basis of my experience, that the measures proposed by the Prime Minister go a long way to bringing into alignment the security of the state without endangering the freedom of the individual. I feel, and I have felt, that this matter might have been studied by a committee of the house. I realize the danger in that connection, because no matter how a thing is designated in the various orders of top secret, secret, confidential or restricted, the difference between top secret and restricted is too often simply a question of whether a matter appears in the press today or three weeks from now. It is a strange thing how matters that are designated as top secret very soon find their way into the public press.
I feel, too, that in the measures announced the individual will have an opportunity of making known his defence. The step is taken officially that previously was followed unofficially. The individual has had that right, not in consequence of a declaration made in the

House of Commons but as a result of its being a rule of practice, without which freedom might very well be denied to an individual. The review of the evidence by a separate body, with the individual having the right to give his side of the case, should go a long way to avoiding and preventing injustice. The setting up of a board of review taken from the membership of the security panel-as I understand the Prime Minister's statement-is a step forward; but I do not think it goes as far as it should. Here you have the security panel, the representatives of the various departments of government. They are the ones who actually examined the case as against the individual. They are then going to sit on appeal, as it were, on the same case that they judged or that certain ones of them judged. I have never been particularly successful in the court en banc when the same judge who sat on the trial sat on appeal in the court en banc. Even though there were two others present with him, his influence was fairly effective.
I do not know the degree to which the government has given consideration to this matter. I felt, when we were considering it, that in setting up a board of review to assure that the individual may not only have justice done to him but may feel that justice is done to him, the board of review should have presiding over it a judge of the Supreme Court of Canada or the President of the Exchequer Court of Canada. It will not take up much of their time. It is a contribution that I am sure either judge would be willing to make. There are not many cases; but when justice is the issue, the number is not of importance. The question is, is justice being done?
I think, agreeing as I do with the desirability of the action being taken along the line indicated by the Prime Minister, representing as it does the study that we made in the past few years, the accumulation of information on the subject, discussions with the minister of justice and by the minister of justice with the commissioner of the mounted police and other law enforcement officers, to add a judge would have a great effect, a major effect in assuring that this board of review, in the findings it would make, would have the benefit of the viewpoint of one who would be entirely detached from the membership of the board and would be able to give to that board experience and knowledge which would be beneficial.
Having said that, Mr. Chairman, may I conclude by saying what I began by saying, that I know the weight of the responsibility that is on the Prime Minister in matters like this-this matter above all. He cannot put it

off on somebody else. He in his person has the custody of our survival and our security. In the views he has placed before the house he has been given the benefit of the study that was made by dedicated public servants whose purpose was to assure that justice shall be done. Fiat justitia mat coelum-"Let justice be done though the heavens should fall".


Francis Andrew Brewin: Mr. Chairman, may I say at once that we in this party welcome the statement that has been made by the Prime Minister. We believe it represents a step forward in dealing with an extremely important and very difficult subject. We believe that the statement constitutes a recognition of the very grave hardships done to individuals by the mistaken application of security procedures. I think that this recognition no doubt owes something to the liberal-and I use the word with a small "1"-tendencies of the Prime Minister and some of his colleagues. I should also like to say that it owes a good deal to the vigilance and effectiveness of the members of the house who, despite official discouragement from time to time have insisted on bringing this matter and individual cases to the attention of the house. I think, for example, of the Knott case where, if it had not been for the persistence of the hon. member for Nanaimo-Cowichan-The Islands the case would have died on the files and a young man dismissed or discharged from the navy in the mistaken belief that his uncle was a communist, as though that had anything to do with the matter. While we welcome this statement we have serious reservations about the effectiveness of the methods and the tribunal which is proposed. Our basic criticism is that this tribunal remains an internal tribunal. It is not a judicial tribunal.
The Prime Minister has given reasons why the government decided not to have a quasijudicial tribunal, and I acknowledge at once that the ordinary method of appeal and trial is not suitable to the determination of security cases where it is impossible to confront the person affected with all the information. But, Mr. Chairman, I know of a precedent which was adopted in wartime which I suggest could and should have been adopted here. During the war the minister of justice, acting under the powers conferred by the War Measures Act and the defence of Canada regulations, found it necessary to intern quite a large number of individuals, sometimes on mere suspicion. After public representation it was found possible to set up a tribunal, which was not a tribunal of civil servants or department heads or within the structure of government, but included, as I recall it, a member of the judiciary who was free, and bound to be free, from the
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necessity to consider the internal or departmental matters and who was able to apply a clear judicial judgment to the problems which came before him. Security, of course, prevented the disclosure by the minister of justice of that day of the details and sources of information against the internees, but the outline of the case was disclosed. The internee had the opportunity to give to this independent tribunal his side of the case, and as a result of that many persons were let out of the internment camps and a continuing injustice was remedied. If this can be done in wartime, Mr. Chairman, I ask why a similar quasi-judicial tribunal cannot be set up in peacetime, when the jobs and reputations of Canadians are secretively filched from them by the present procedures we adopt.
There are other reservations in our minds as to the announcement which has been made. For example, we are concerned whether the protection is extensive enough. Most members of this house are familiar with the large number of cases of refusal of citizenship, of refusal to allow otherwise qualified persons into the country, relatives of people who are here now; and the very same secretive type of proceedings are adopted whereby they are denied any knowledge of the nature of the case made against them.
As I read this statement it applies to government agencies, but this problem extends far beyond that. These procedures apparently do not apply to the services at all; yet the most notorious case in this field which has been brought to the attention of this parliament was the case of a man discharged from the navy. There are also other bodies and corporations working on security matters who are also given information, and people discharged in such cases lose their jobs and their reputations, and their future is endangered in precisely the same manner as those who are actually discharged from the government service.
While we welcome this statement, we think there are many other questions which should be asked, and I will just mention a few of them. What about the training of the people who do this particularly delicate and difficult security task? I do not know what the training is, but from the results which occur I suggest it is not good enough. I have nothing against the Royal Canadian Mounted Police as a force. I echo, though not with the same eloquence, the tribute paid by the Leader of the Opposition to that force. But in this sensitive field of security I do not believe that the police, including the R.C.M.P., are trained in that delicate political judgment which is necessary to prevent them from making mistakes, and we only know a very small and

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insignificant fraction of all the cases involved. We want to know on what sort of principles the security officers are to act.
I have read with great interest what the Prime Minister said about the fact that in certain cases relationship creates a security risk. Yet, Mr. Chairman, have the principles for applying this been worked out so that we do not get the situation as revealed by the Knott case and many other cases where a remote-indeed in that case a mistaken-relationship was used to debar a person from useful service? Every one of us in this house will probably know of someone who has an uncle or aunt who has attended a communist meeting or might be in the bad books of the R.C.M.P. Are their nephews and nieces to be debarred from public service? It is true the procedure we have here will assist in enabling those cases to be scrutinized, and as I have said I welcome what has been done. But I say to the Prime Minister and the Minister of Justice that although this is a step forward, I think they would do better to avail themselves of tried judicial independent proceedings to solve their problems, as was done by their predecessors in wartime in the last great war.
I am not happy about this tribunal of internal civil servants, no matter how much we may happen to respect them. I give warning to the government that there are many other matters dealing with this field which require to be carefully investigated, and we feel it is our duty as an opposition to bring these cases forward and keep up a continuing vigilance. We are not going to be fobbed off by a tribunal, no matter how much we welcome this as a recognition of the problem. We are going to continue to urge that these matters be scrutinized in parliament and that independent procedures be preferred.
I have a number of observations I wish to make about the estimates generally, Mr. Chairman, but I take it at this stage it would be appropriate to deal only with the matters announced by the Prime Minister and the Minister of Justice.


Stanley Howard Knowles: No, go ahead.
Mr. B rewin: I am encouraged by some of my colleagues in my immediate neighbourhood to deal with other matters affecting the Department of Justice as well. I know that one point I have to make the minister will agree with, if he agrees with nothing else, and that is the Department of Justice over which he presides is a key department, and at the present stage of the Canadian history the leadership of the minister and his department is urgently needed. I hope the minister will demonstrate I am wrong when I say it does not seem to me that he and his department
[Mr. Brewin.l
have shown the type of leadership required to do the important task committed to them.
I do not propose to discuss at length the skyrocketing price of sugar. I am aware that the small staff of the combines investigation branch does the best it can. I am also aware, as the minister indicated, that there are constitutional difficulties about controlling the price of commodities. But I must say that the impression given by the minister in answering questions on this subject seems to me to indicate the futility of the present machinery and the lack of decisive will to tackle profiteering in essential commodities.
We live in an age when the ramifications of government are many and growing. The struggle between liberty and authority which characterizes all human societies is unending and is particularly acute at the present time. In this battle, the grievances of citizens who find themselves badly treated by those in authority require, if they are to be remedied, new institutional methods as well as unceasing vigilance on the part of the Department of Justice. We have heard today about one field of these interests but there are many others which are important. One of the pieces of machinery which is being suggested from every side of this house is the creation of a parliamentary commissioner or ombudsman. This proposal has been before the house for some time. Indeed, it is the subject of a resolution sponsored by the hon. member for Port Arthur. I do not propose to discuss this subject at length, but I say to the Minister of Justice that such a commissioner has proved his value overseas in countries where the system has been tried- in Sweden, and, more recently, in Denmark and in New Zealand. The existence of a great bureaucracy is not, in my opinion, a sinister thing. It is inevitable. Most of its purposes are beneficial. But people get hurt by the activities of government. When men of substance get hurt they do not have too much of a problem; they can hire expensive lawyers to defend th sir interests. But when men of lesser means get hurt by this infinity of regulations and procedures they often find themselves without any effective remedy. What I suggest is needed is an official of parliament who has full power to investigate, to secure the production of documents, to arrange a settlement of grievances where possible and to report to the house. On May 22, the Minister of Justice, in answer to a question of mine, expressed interest but disclaimed responsibility. I should have thought the Minister of Justice had a special responsibility to advise parliament of steps which could be taken to strengthen the civil rights of Canadians and not leave it to the

often futile procedure of private member's resolutions.
In my opinion there is a still more fundamental responsibility placed on the Minister of Justice, and that is to take the necessary action to protect human rights and freedom by bringing about the incorporation within the constitution of Canada of a bill of rights. This brings me to a question of the first importance facing Canada, a question whose solution demands the leadership of the Minister of Justice. Are we serious in saying, as we approach Canada's 100th birthday, that we intend to repatriate the Canadian constitution? Are we serious in saying we intend to take a new look at it and bring it up to date? Last Monday the minister is reported as having told the Liberal federation of Quebec-I am not certain that I have the name of the organization right-that it was necessary to re-think the whole form of confederation and adapt it to present conditions to ensure specific rights to Quebec and to French Canadians in general. I do not wish to underestimate the importance of giving clear and binding effect to the special rights of Quebec and of French Canada in confederation. But I say to the minister that in taking a new look at the constitution it is necessary for him to consider the rights of all Canadians. It is necessary to bring the new constitutional compact which I hope will be made in Canada and within this framework to recognize the basic rights and liberties of all Canadians so that they shall be immune from attack by provincial and municipal authorities as well as parliament and its agencies. We need a bill of rights composed not only of noble words but having the force of law, with teeth for its enforcement. We now have a declaratory bill of rights, a bill which has been cited over and over again in the courts with no effect. The former prime minister himself described this declaratory bill of rights as a first step. It is about time another step was taken.
What has been done about the re-thinking and adapting of our constitution? On June 19, as reported on page 1326 of Hansard, I asked a question about this subject. I asked what steps were being taken or contemplated with a view to having the constitution of Canada repatriated, or what consultations had been held for this purpose. The hon. member for Rosedale, answering in his capacity as parliamentary secretary, said: "None, by the present government." That was his answer. He said:
No steps have yet been taken, and if and when it is decided to do so, the government will so indicate in due course.
The answer, in short, was a complete negative. Let me warn the minister that this re-thinking and adaptation of our constitution
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to the needs of the present day cannot be done by a few officials behind closed doors at a hastily summoned interprovincial conference. I have received a statement from Professor Ryan of the University of New Brunswick, president of the association of Canadian law teachers. I am not going to read that statement, though I should like to, but he urges the view of his association that the widest opportunity should be afforded for public representation and discussion before a formula for amendment is adopted by the conference which is proposed.
If the minister faces a much wider task than merely finding a formula for amendment; if, as he has indicated, what is involved is the re-thinking and adaptation of the whole form of confederation, these remarks apply even more clearly. I suggest there is no time to be lost in instituting the necessary process of public discussion and consideration which will involve not only government officials, but Canadians in every part of the country, members of opposition parties as well as of government parties, and people of all occupations.
I come, now, to another serious matter, which I have already discussed with the minister and which, in my view, gravely affects the administration of justice.
The high and unsullied reputation for integrity enjoyed by our judges is one of the foundations of our system of justice and, indeed, of any civilized system of justice. But now, in public statements in the press and in the legislature of Ontario, implications have been made affecting the integrity of a justice of the supreme court of Ontario.
It is necessary for me to go back in time to give the house the background of what I have to say. In 1958 an investigation was made into the manner in which northern Ontario natural gas issued stock at advantageous prices to public officials to promote its interest in Ontario. As the result of the investigation three ministers of the crown in Ontario resigned. At that time, Mr. MacDonald, a member of the legislature told the legislature in considerable detail that a block of 14,000 shares of stock had been issued to a company known as Continental Investments and used to secure approval by certain municipal officials in some northern Ontario town of the granting of franchises to northern Ontario natural gas.
This matter was inquired into by the Ontario securities commission and the then attorney general, Kelso Roberts, stated in the legislature that there had been no impropriety in relation to the issuing of the stock.
Last year, however, more information was discovered by the B.C. securities commission. Further investigation was made at Mr. HOUSE OF COMMONS
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Roberts' request. In April of this year Mr. Roberts, the former attorney general, stated in the legislature that a politician in a municipality doing business with northern Ontario natural gas got the major part of the 14,000 shares at a nominal cost. Mr. MacDonald in answer to inquiry, named Mr. Justice Landre-ville as the official involved. Mr. Justice Landreville before his appointment as a supreme court justice in 1957, was the mayor of Sudbury. He was appointed shortly after the franchise was granted. The new report of the commission was made available to the present attorney general of Ontario, Mr. Cass and, presumably, to the government of the province in July. Mr. Cass caused proceedings to be instituted-


Lionel Chevrier: Mr. Chairman, I rise on a point of order. While it is true that the hon. member did give me some indication he was going to do exactly what he is doing now, I submit to you with deference, sir, that it cannot be done under the rules unless the hon. member is prepared to move for the impeachment of the judge he has in mind. I refer to citation 149 of Beauchesne, fourth edition, which reads as follows:
Besides the prohibitions contained in standing order 35, it has been sanctioned by usage both in England and in Canada that a member, while speaking, must not:
(j) cast reflections upon the conduct of judges of superior courts, unless such conduct is based upon a substantive motion.
Unless the hon. member is prepared to move a substantive motion I am afraid he is in contravention of this citation.


Francis Andrew Brewin: Mr. Chairman, on the point of order, I want to make it clear, and it would have been made clear in a few sentences if I had been able to do so, that I am asking that this matter be investigated, not because I make any charge or accusation against the judge but because others have done so and I believe it to be in the interests of the administration of justice and in the interests of the judge concerned that this matter be cleared up. All I propose to ask is that the Minister of Justice do what I believe to be his duty in the circumstances, and that is to institute a full inquiry into this particular matter.
I am not making any accusations. As the matter will develop, it will be made perfectly clear that I believe the judge is entitled to every presumption of innocence. But I wish to point out that this matter has been raised and reported upon in publications, newspapers and national magazines and I say it is only fair to the justice involved and to the whole administration of justice that it be cleared up by the minister at the earliest opportunity.

I say that the citation from Beauchesne to which the Minister of Justice has referred does not deal with this particular matter. As I intended to say in a few minutes, I sincerely hope and believe that the judge will be able to clear up the imputations made against him, but I say that the minister responsible to the house for the administration of justice has a responsibility to inquire into this matter and that later, if anything is discovered that is derogatory of the judge at all, it will then be the minister's responsibility to make the necessary motion.
In case Your Honour should rule against me on this matter and abbreviate what I have to say to the house, I want to make it perfectly clear that I am only repeating accusations made in responsible publications and spread across the press of the country, and I am only doing so in order to urge the minister to give the judge, through a full and open public inquiry, the right to meet these innuendos and insinuations that have been made against him.
A further point has been called to my attention. I am not saying anything about the judge in his judicial capacity. The events in question took place some months before the appointment of the judge. What I am saying is that the statements made about him constitute a contempt of the administration of justice and that as Minister of Justice the minister has a responsibility to look into this matter. I am not accusing the judge of judicial misconduct. If by any chance the facts are as alleged and the minister finds that to be so on proper inquiry, the time to act will then come and the responsibility will be his.
But, Mr. Chairman, I am not making these accusations. I do not propose to make a substantive motion. This matter has had widespread publicity given to it already. I would have hesitated to mention it if I were the first to raise it, but in view of the publicity given to it I believe I am within the rules of the house in making the proposition to the minister that it is his duty as minister and in the interests of the judge himself to see that this matter is cleared up at the earliest possible opportunity.


Lionel Chevrier: Mr. Chairman, I would not ordinarily rise at this point because normally I believe it is the practice to allow other members to speak before the minister replies. But because of what the hon. member has said I feel it is my duty to rise now and bring to the attention of the house, not so much the fact that the hon. member has repeated accusations made elsewhere, but the fact that by doing so he has impugned the reputation of a judge of the supreme court of this province. While he may say he has made no personal attack on him, the very fact that he has

repeated these allegations is in my opinion tantamount to the same thing.


Thomas Clement (Tommy) Douglas: Mr. Chairman-


Lionel Chevrier: I am not through. I have the floor.


Thomas Clement (Tommy) Douglas: On a point of order, Mr. Chairman, I want to know how the minister got the floor. The hon. member for Greenwood had the floor. Is the minister speaking a second time on the point of order?


Lucien Lamoureux: My understanding is that the minister raised a point of order and this is why I have allowed the minister to speak. He is not speaking a second time.


Thomas Clement (Tommy) Douglas: He is certainly not discussing the point of order. He is now replying to the hon. member for Greenwood who had not finished his statement and I think the member should be allowed to finish his statement.


Lionel Chevrier: But the hon. member sat down and I rose after he sat down.


Thomas Clement (Tommy) Douglas: No, he sat down because you interrupted him.


Lionel Chevrier: I did not interrupt him. The hon. member did not see what was happening. I saw the hon. member for Greenwood sit down.


Thomas Clement (Tommy) Douglas: On a point of order; the hon. member for Greenwood sat down because he thought Your Honour was going to rule on the point of order.


Lucien Lamoureux: Will the hon. member
kindly resume his seat. My understanding of the matter, and it should not be too complicated, is that a point of order was raised and I understood that the hon. member for Greenwood was still speaking on the point of order. As far as the Chair is concerned, I was still looking up authorities and deliberating on the point of order. At this point the Minister of Justice stood and the hon. member for Greenwood sat, so I believe he yielded the floor on the point of order. If he did not, I suppose I should allow him to complete his point of order and then allow the Minister of Justice to speak on that point.


Francis Andrew Brewin: I want to make it perfectly clear I am speaking only on the point of order. I think it would be advantageous for the house and advantageous for the individual concerned if I were permitted to complete my statement. I make it in all responsibility as a serious statement. In my submission I should be permitted to complete my statement and I respectfully submit it is not out or order. I am casting no aspersions.
I do not fall within the citation which has been given and I hope that I will be permitted to proceed. I certainly have not concluded my remarks.
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Lionel Chevrier: May I say that I rose on the point of order and cited Beauchesne as my ground for submitting that if the hon. member wanted to discuss the matter further he should move a substantive motion. This he said he was not prepared to do, and when I was interrupted by his leader I was going on to deal with the question of my responsibility. If the house and the hon. member do not want to hear me at this stage I am quite prepared to resume my seat, but I think the house should know, in answer to what the hon. member for Greenwood has said, whether or not there is under the circumstances a responsibility on the Minister of Justice in this case.


Thomas Clement (Tommy) Douglas: No one denies that. The point I am making is that the hon. member for Greenwood had not had the opportunity to finish his statement. He sat down because he thought Your Honour wanted to rule on the point of order raised by the Minister of Justice. I assume that the reason you have not risen is that you do not agree there is a point of order and that the hon. member for Greenwood can be allowed to complete his statement, after which the minister can properly reply to him.


Lester Bowles Pearson: Mr. Chairman, perhaps you are in a position to make your ruling on the point of order now.


Lucien Lamoureux: I am sorry, I could not hear the Prime Minister.


Lester Bowles Pearson: I asked whether you were in a position to give your ruling on the point of order now.


Lucien Lamoureux: Yes, I am. Perhaps I could make a ruling now on the point of order which was raised a moment ago. The feeling of the Chair is that the position which the hon. member for Greenwood seeks to adopt is out of order on two counts. First, I should like to refer him to standing order 59(2) which reads as follows:
Speeches in committee of the whole house must be strictly relevant to the item or clause under discussion.
My submission is that the administration of the courts is not a matter directly under the jurisdiction of the Department of Justice. On this count, I do not think the subject matter which is now being raised by the hon. member for Greenwood can be discussed.
Then, I should like to refer the hon. member to citation 149 (j) of Beauchesne's fourth edition, to which the Minister of Justice referred earlier. It reads in part:
-a member, while speaking, must not:
(j) cast reflections upon the conduct of judges of superior courts, unless such conduct is based upon a substantive motion:

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I should like to refer also to citation 152 (4), which reads:
All references to judges and courts of justice and to personages of high official station, of the nature of personal attack and censure, have always been considered unparliamentary-
Now, I understand that the line of argument taken by the hon. member for Greenwood is this: I am not, myself, saying these things, but I am repeating what other people have said. In my submission, this is an attempt by the hon. member to do indirectly what he cannot, under our rules, do directly. I submit, therefore, that he cannot continue along this line and that his remarks on this subject are out of order.


Thomas Clement (Tommy) Douglas: Is it your ruling, Mr. Chairman, that the subject is closed and the hon. member for Greenwood cannot discuss the matter further and, consequently, the Minister of Justice cannot reply?


Lucien Lamoureux: I cannot anticipate what the hon. member for Greenwood may wish to discuss from now on, but I am ruling that what has been said up until now has been out of order.


Francis Andrew Brewin: It may be that on some other occasion, Mr. Chairman, I will have an opportunity, within your ruling, to complete the remarks I intended to make. I intended to point out that I was doing this so that a judge would be able to clear his reputation because, in my view, the administration of justice demands that something be done about this matter.


Douglas Mason Fisher: Mr. Chairman, on the first point that you raised-


Lionel Chevrier: Order, the chairman has handed down a judgment.


Douglas Mason Fisher: We have an opportunity to appeal it.
I should like a further elaboration of the first point you raised, Mr. Chairman, concerning the administration of justice not being the responsibility of the Minister of Justice. We passed a bill in this house raising the salaries of judges. I have a file of letters from judges on various matters, and I think many of us have been in communication with judges. We are quite aware of the fact it is the federal government that chooses judges, and pays them. The point I should like to make is, if this precedent is allowed to stand some remarks I intended to make about judges which had nothing to do with this judge, would be out of order. I do not know what the process is, but I would appeal to you, sir, to reconsider that part of your ruling.


Lionel Chevrier: May I-
[The Chairman.]


Lucien Lamoureux: Perhaps I might say one word here. I should like to make my ruling as restricted as possible. I am not suggesting that no one can discuss anything relating in any way to judges. I feel that the ruling which has been made by the Chair at this point should be limited to the particular circumstances which were before the committee at that time.


Mr. Bell:: I wonder if I might ask a question of the Prime Minister, without taking the place of the hon. member for Medicine Hat in the order of debate?
I just want to ask the Prime Minister, appreciating the seriousness of his statement as well as the drama that has been created around the corridors by members of the press, if he can give us his assurance that there has not been any recent episode or breach of security that brought about this statement?


Lester Bowles Pearson: I can give that assurance without equivocation. We have been working on this revision of security procedure for some two or three months now, and as soon as the work was completed and the opportunity arose on these estimates, we brought it to the house. There is no particular circumstance which made that desirable at this particular time.


Horace Andrew (Bud) Olson: Mr. Chairman, I had intended to say quite a lot about the matter of the security and intelligence division of the Royal Canadian Mounted Police, and the method they have in determining who ultimately becomes a security risk. The statement which has been made by the Prime Minister tonight concerning the three steps he has suggested will be taken in the future, to some extent will answer the matters I was going to raise. I am not sure we can accept these provisions as the ultimate answer to the problem that we have in these security risks. I agree, too, that I do not believe it is possible at this stage to comment upon all the ramifications of these steps, or the success that they might be. For the present, Mr. Chairman, I am willing to give this a trial and see what happens.
I know that in my own constituency, and I am sure in the constituency of nearly every member in this house, there are Canadian citizens and other people who have been refused citizenship who honestly believe that wrong evidence has been presented to the Royal Canadian Mounted Police in classifying them as security risks. I hope these steps the Prime Minister has outlined will, in fact, provide an opportunity to these people to present their case to someone. Perhaps, as the Prime Minister has said, they could even be faced with some of the information that has condemned them.

I turn now to another extremely important matter that is facing Canada today. First, we can all agree that the first duty of the Minister of Justice is to enforce the law and protect the lives of our citizens and give them some measure of freedom from fear. I do not think anyone in this house would be in disagreement on that matter. As a matter of fact, earlier tonight the Prime Minister said we should not allow the undermining of our basic principles. He even said that citizens give the state the direction in enforcing and upholding law. I am not suggesting that these are direct quotations, but I think it is a paraphrasing of some of the things the Prime Minister said tonight. He was referring to things of a political or ideological nature which were unfriendly to Canada in which a person may have been involved.
However, I believe it is equally as bad, and it may even be worse, to allow any organization in Canada, be it a labour union or otherwise to rule by force or intimidation. To suggest, as the Prime Minister has said, that the citizens give the state directions in enforcing and upholding the law, to suggest that the citizens of Canada are prepared to tolerate the intimidation that has gone on in the seamen's union during these past four years, I think is absurd. These weaknesses of law enforcement are today putting Canada and democracy on severe trial to maintain the confidence of our citizens in the maintenance of law and order.
At the outset I want to say that this matter of enforcing the law is not confined to enforcing it on labour unions. Some of the things that have gone on and are documented in the Norris report are matters of encroachment on human rights and liberties. Citizens, whether they be members of a labour union or not, are entitled to protection under the law from such encroachment, and I might mention that this question of enforcement of the law with respect to labour unions is giving some labour unions and their members a black eye which they do not deserve.
There may be what Justice Norris has described as jurisdictional jealousies troubling the Minister of Justice in getting down to the question of enforcing the law. Mr. Justice Norris has this to say at page 312 of his report:
Local police forces are not equipped to deal with mass action by irresponsible persons. All police forces, federal, provincial and municipal should extend their efforts to the utmost in co-operation with each other-avoiding jurisdictional jealousies- to the end that there shall be certainty in the enforcement of the law and that respect for the law will be maintained. It should not be difficult by co-operation between all police forces to reach a common understanding as to action in connection with labour disputes. It might be that police officers should have some special training on labour matters.
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If the Minister of Justice has run into this problem, then I think it is his responsibility to look into the matter and come before parliament to introduce what might be called emergency legislation, giving him the power to deal with this mess. Most of us are agreed that it is this intimidation, particularly in the S.I.U., that allowed the situation to develop to the point it reached.
Even today the Minister of Justice suggested, with respect to some men who were beaten up on the train last Monday night, that one of the men involved refused to testify. We must ask ourselves why, and I am sure we are all agreed the reason is that he is scared. He has no confidence that the law will protect him and is afraid to testify, even though he had a severe beating.
Questions were asked repeatedly of the Minister of Justice, as far back as early July, about what he was going to do concerning Justice Norris' recommendations on prosecutions. They are to be found at pages 2234, 2302 and 2303 of Hansard. I shall not enumerate all the pages, but on almost every occasion the minister replied that the matter was under investigation and he could say no more at this time. I believe our common law states that if justice is to be done it demands justice without delay, and in this respect the previous ministers of justice are equally guilty, because many of these acts of violence took place when they were in office.
I hope that soon-indeed the day is long past-the minister will find some way to enforce the law and restore confidence in the people that the law will be maintained. If he cannot find anything in the present statutes to enable him to do this, then he should come before parliament and ask for additional power. The action taken respecting this whole mess for the last three or four months can be described as a despicable display of dereliction of duty.
The minister's first responsibility is to enforce the law, and I suggest he has not been doing it. He has not taken all the steps he could have to remove fear and intimidation from the men who have been involved in these things.
Schedule 31, which was published along with the Norris report, quotes 75 cases of what are called, "examples of intimidation and violence." To my knowledge there has not been a single conviction in any of them. For example you find-and I am not going to read this all into the record because hon. members have it in their possession-that on October 24, 1958, a man was beaten up and under the section headed, "Action taken if any," it states "no mention" of any action taken by the law enforcement officers.

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On November 6, 1959, another man was beaten up and again under the section headed "Action taken if any" it says, "Wife called police. No mention of police action." Mr. Justice Norris has said that the evidence did not clearly indicate that the officers of the S.I.U. were responsible, but one thing the victims all had in common is that they were opposed to the S.I.U.
I appeal to the minister tonight to get on with the job of enforcing the law of the land so that our citizens can be freed from the kind of intimidation which has been so pronounced over the last months and years.


Gilles Grégoire: Mr. Chairman, the Prime Minister (Mr. Pearson) announced early this evening that there would now be a board of appeal for persons who have or may have access to secret documents to enable them to justify themselves, should circumstances require them to do so, and to allow the government to make sure that its employees, in departments where secret documents do exist, are reliable. In my opinion, the setting up of that board of appeal is a most commendable thing.
Be that as it may, I feel that, this evening, we have more important things to discuss concerning the estimates put forth by the Minister of Justice (Mr. Chevrier).
At noon, on the orders of the day, some questions were asked but, unfortunately, the few answers given were vague, even evasive. The matter is either being examined or else there is nothing to reply.
A while ago, the hon. member for Medicine Hat (Mr. Olson) spoke about seamen who were being threatened by some labour leaders.
It is now my turn and I would like to talk about a very serious problem, that of an international trust that managed to make the price of sugar rise even though there is no shortage-


Georges-J. Valade: Mr. Chairman, I rise on a point of order. I should not want to stop the hon. member for Lapointe (Mr. Gregoire) from making his remarks on the estimates of the Department of Justice but I feel that he should speak on the statement made by the Prime Minister.
The hon. member is dealing with item number one of the department's estimates, which is contrary to the rules since members of the official opposition have the privilege of being first to express their criticism. It is only out of courtesy that we did not interrupt the hon. member for Greenwood (Mr. Brewin) a few minutes ago.
Since members of the official opposition have precedence, I feel the hon. member for

Lapointe should postpone until later on his remarks on the estimates of the Department of Justice.


Lucien Lamoureux: I think that the hon. member for Lapointe may proceed with his remarks along those lines. Since we are considering the first item of the estimates of the justice department, he is entitled to keep on discussing the point he raised and which is actually related to the estimates of that department.


Georges-J. Valade: Mr. Chairman, I refer again to the point of order, because I understand that the hon. member for Bow River (Mr. Woolliams) had already intimated that he wanted to speak on the estimates of the Department of Justice. You reversed the order of priority earlier and by courtesy we did not object when the hon. member for Greenwood took the floor, but he was supposed to confine himself to the criticism of the estimates of the justice department, instead of commenting some other point or the statement of the Prime Minister and of his colleague, the Minister of Justice. We did not deem it necessary then to create a precedent to the effect that the official opposition should yield to another party of the opposition which has priority over the party represented by the hon. member for Lapointe. I therefore suggest that the member for Bow River be recognized.


Lucien Lamoureux: I did not make any agreement with a party to the effect that the comments of each member would be strictly limited to the point raised by the Prime Minister. I therefore suggest, once again, that the hon. member for Lapointe is in order and he may go on.


Gilles Grégoire: Mr. Chairman, I was talking about a problem which has again been raised lately, that is, the increase in the price of sugar.
Obviously, one may ask what this has to do with the estimates of the Department of Justice. However, I believe that it can easily be related to the problem in question because, in my opinion, the whole matter of the increase in the price of sugar rests on the fact that the Department of Justice tolerates at this moment a combine of a number of companies which fix the prices in spite of normal trade practices.
There lies on the part of certain concerns an infringement due to the fact that there is no competition, as it were, in the sugar trade, and that Canada, like many other countries in the world, when it comes to certain commodities, sticks to regular suppliers and remains a faithful member of the London Sugar Exchange without even calling for tenders on the world markets.

There are in the world various places for the marketing of sugar. But Canada is caught in the toils of the sugar trust which is connected with the London exchange.
Mr. Chairman, there is in those continuous increases a case which really goes against Canadian anti-trust legislation. When it has been established that sugar is not scarce at the present time, it is realized that despite that fact some companies, by a common scheme, succeed in increasing the price of a certain product, like sugar, as in this case.
In the month of May, when such a thing happened, the Minister of Justice announced that he would investigate the problem. Immediately the companies, by common agreement, decreased the price of sugar.
The result of the investigation announced in May by the Minister of Justice was never made known to us. There was no announcement or press release, reporting that the Department of Justice, following its investigation, had discovered such or such a thing. The companies took advantage of the situation recently to increase once again the price of sugar, so that it reached an all-time record, the highest since 1943.
What is going on at the present time and why is the Minister of Justice tolerating so long that companies speculate that way, at the expense of the Canadian people and to the prejudice of Canadian trade?
I do not understand how the Department of Justice has put up for such a long time with the monopolizing of a group of companies who try to keep the prices at a high level at the expense of the Canadians, while there are federal acts to deal with such companies which, by means of a trust, thus manipulate prices.
I wonder why the Minister of Justice does not act more quickly in the case under consideration.
We hear about investigations, but those investigations have been going on for many months, in fact since May, and we have yet to hear some of the results. Are things dragging on or are the minister's hands tied in any way by the companies that impose their will on the government? That has happened before. Are we witnessing today the repetition of one of those acts? How is it that the minister does not proceed more expeditiously in his investigation? He does not give an answer to the house, he does not say what is going on while the sugar companies are playing their little game.
That is all the more serious because at the present time those sugar companies are practically all foreign companies that come here to exploit the Canadian people in that field.
In fact, Mr. Chairman, the Minister of Justice should investigate that matter or at
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least he should submit the report of his investigation as soon as possible and see to it that those problems be dealt with, to the benefit of the Canadian citizens.
I have now, Mr. Chairman, another matter that I should like to explain, for a few minutes, to the members of the house. I am referring to the parole board.
Several weeks if not several months ago, the Minister of Justice announced-in fact he promised that there would be an investigation in regard to the parole granted some individuals-incidentally, there have been two or three-who, on account of their behaviour, have proven that parole was not justified in their case.
In my riding, several families-and at least one officially-have been the victims of the parole system. The Minister of Justice certainly knows of whom I am speaking: it is the man Dionne, from Quebec. We have not yet seen the report on the inquiry the Minister of Justice was to make in this matter.
I now want to point out to the government another problem which, I think, is a most important matter at this time. It is the question of loans and interest rates.
The federal statutes contain no legislation to control loans and rates of interest. In our counties, we see a proliferation of finance companies or individuals who lend money at excessive interest rates, so that it could almost be called legalized theft.
I, myself, have found many cases where farmers in my county had been granted loans at rates of 40 and even 45 per cent. Lately, in Ontario, the provincial government appointed a committee to inquire on the activities of some finance companies. That inquiry has shown that some individuals or loan sharks were lending money at such abusive interest rates that it was nothing less than a theft.
At this time, there is no federal law in our statute books to control the interest rates charged by moneylenders.
Mr. Chairman, I humbly submit to this government that if there is a case of urgency, it is surely to provide some legislation in this field, in order to establish some rules regarding loans, whether they be mortgage loans, small loans by finance companies, or loans in excess of $1,500. That legislation would set down rather strict rules to put a stop to the unfair practices now going on in Canada in that field.
A while ago, I heard the hon. member for Greenwood deal with another problem, the revision of our constitution. The Minister of Justice announced last week end that a federal-provincial conference would be held

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to re-examine the constitution in order to bring it up to date.
I do not want to spend too much time on that problem. Those who will have to deal with it will take it upon themselves to reexamine our constitution and look at it from every angle. However, I should like to remind the Minister of Justice that, before that federal-provincial conference for the revision of our constitution is organized, there must be at least some guiding principles to inspire Canada's new constitution.
I have been given the opportunity to realize that such an idea could be the main inspiration for a new constitution. I have been aware of that since I have become a member of this house, from the time I learned about several bills put forward to deal with various problems and since I have had the opportunity to talk with members from other provinces, from this other great nation which is part of our country.
I must agree that too many French Canadians are unfortunately not familiar with the workings of the English mind. In fact, that was somewhat my case before I came here. My opinion has changed on certain points since then. However, I have become more and more attracted by an idea which could truly become the fundamental principle of a new constitution, that is that, in the future, it will be useless to consider Canada as the federation of ten provinces.
When some piece of legislation is enacted in spite of the opposition of one province, then the latter must bear the consequences.
On the other hand, if a statute is favourable to one province only, then it is the nine other provinces which suffer from its adoption.
It is my feeling that in reviewing our constitution, we will have to take into account the two nations which live side by side in this vast country of ours which goes from the Atlantic to the Pacific.
Mr. Chairman, during a sitting of the miscellaneous bills committee, I got the confirmation of the allegations I am making now.
At the time, the committee was examining the bill to incorporate a national association of pharmacists. Under its new federal charter, the association would have acquired certain rights and privileges. Nine provinces were in favour of the bill to incorporate the association whose board of directors would issue licenses to qualified pharmacists. However, one province was against this legislation.
And then, if a province should decide to block passage of a bill that nine other provinces are requesting, these nine provinces will have to suffer the consequences, while if we lived in a confederation made up of two nations, enjoying more freedom, more rights

and more privileges within the said confederation, we would not witness the clashes which are seen nowadays.
In fact, we see, for instance, that in the field of education, nine provinces welcome the centralizing of education services and that, maybe, with a view to set up better communications between them and-


Lucien Lamoureux: Order. I regret to have to interrupt the hon. member, but I must say I find it quite difficult to see any relevancy between his remarks and the estimates now before the house.
Besides, I would draw the attention of the hon. member on the fact that paragraph 2 of standing order 59 reads as follows:
Speeches in committee of the whole house must be strictly relevant to the item or clause under consideration.
Now, I do not think the hon. member's remarks and the arguments he is trying to bring forward have any relevancy to the estimates now before the committee.


Gilles Grégoire: Mr. Chairman, I was under the impression that when the first item of the estimates of the Department of Justice was called we were entitled to make our views known to the house at any time.
Moreover, as the task of preserving and rethinking the constitution, when this is required, comes under the jurisdiction of the justice department, I thought I was in order in dealing precisely with a subject which concerns particularly the Department of Justice: that is, the Canadian constitution.
However, if you are of the opinion that the ideas I submit are out of order, I shall abide by your decision.


Lucien Lamoureux: I want in no way to limit the remarks of the hon. member, but I think very sincerely that the remarks he is presently making, and the arguments he has been offering to the committee in the last few minutes, do not relate closely enough or directly enough to the estimates.


Gilles Grégoire: Very well, Mr. Chairman, I shall try to And another appropriate moment to submit certain ideas concerning the revision or the rethinking of our constitution, as the Minister of Justice has expressed the wish, for some time. In fact, I want to congratulate him for his serious work in that field; that work was necessary and I am of the opinion that the revision should not be delayed too long.
Mr. Chairman, there is a last problem which I wish to raise in connection with the consideration of the estimates of the Department of Justice. It is that of bilingualism within the said department. We shall have an opportunity to ask questions on this sub-

ject, later on, for we think that bilingualism is a must in such an important department as that of justice, for if an individual has rights and privileges to claim, he must often claim them before the courts, and, then, if he wants adequate means to defend himself, he may resort to the services of bilingual civil servants of that department.
We also wish to make recommendations to the minister regarding civil servants, not only concerning quantity, but also with regard to quality. It would be advisable that senior posts be equally distributed between representatives of the two great races which make up Canada.
As for the purchasing division of that department, it should consider that there are French Canadian companies in addition to English Canadian companies and allow both to get their share of orders, in order to promote the economic development of both groups.
I know that the Minister of Justice has been the member for an Ontario riding which is so well represented by the present chairman of the committees of the whole (Mr. Lamoureux). I am also aware that he now represents a riding in the province of Quebec. This might have brought him in contact, better than any of us, with the two great nations in this country. In fact, I am of the opinion that he is in a better position than any other member-I have no ulterior motive in saying this-to understand the problems of the two great races, on account of his past experience. That is why we are going to be more demanding as far as he and his department are concerned. In so doing, the officials of the other departments will understand exactly what we mean by bilingualism -that it is not simply a matter of duties, but rather a way of thinking on the basis of the two great races which make up our country.


Mr. Woolliams:: I think we were all interested to hear the Prime Minister outline new methods of preserving security in our country. I should like to congratulate him on setting these changes out so clearly. I was glad to hear that a board had been set up before which those concerned may be heard. I hope the suggestion made by the Leader of the Opposition that someone accustomed to sitting in a judicial capacity should be a member of such a board, because unless its members include some independent person I am sure those who come before the board will not feel that justice is being done. I trust that this recommendation made by the leader of my party will receive serious consideration.
I should like to join, also, with what my right hon. friend had to say with reference to
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the R.C.M.P. I have had a good deal of experience of the R.C.M.P. and I have expressed my views about this distinguished body on earlier occasions. I have always found that these men, when they administer the law, stay within the ethics which we expect of the R.C.M.P. in this country. They are respected not only in Canada, but by those who come from other lands to visit Canada, by those who know them almost as well as Canadians know them.
I was interested to hear the hon. member for Medicine Hat speak about the enforcement of law in this country. The administration of justice, after all, falls within the sphere of the Department of Justice. I had something to say about the administration of justice and the enforcement of the law this week when we debated an amendment to a supply motion. I think it might be well to read what the new prime minister of Great Britain had to say with reference to law enforcement as he sees it. This is what he had to say in one of his earliest addresses as prime minister:
Some people are suspicious of law and order, as though the rule of law was a mere trick to freeze the status quo. It is quite the opposite. Its observance is the sine qua non of peaceful change. The rule of law is a lesson learned from centuries of human experience, from many mistakes and much suffering. It amounts simply to this: that only by submitting ourselves to obey the law can we reconcile conflicting ambitions and serve the interest of mankind as a whole. Without the rule of law we destroy one another.
I think an admission was made in this house that certain groups or associations of groups were breaking the law. I still think it is the duty of the government to enforce the law, especially when there is an admission that the law is being flouted each day. Now this situation has changed in a practical way. The men concerned have gone back to work on their ships. Possibly the practical benefits will be some compensation in a small degree for the law not having been enforced. I do not wish to say any more on this subject, but I do feel the government has been most remiss and irresponsible in failing to enforce the law as it applies in this case.
I wish to go on to deal with the penitentiaries system of this country. Some time ago it was planned that there should be built in the city of Drumheller a penitentiary, an institution for young offenders, which would cost approximately $4 million. There is a growing need for such an institution in this country. I should like to go into this subject in some detail. I have here an article entitled "Children To Penitentiary". The heading goes on: "We must overhaul our treatment of juvenile delinquents, says the man who heads our first coast-to-coast study of this pressing problem." This refers to a statement made by

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the commissioner ol penitentiaries A. J. MacLeod, who was a member of a commission which investigated conditions among young prisoners in penitentiaries in this country. I should like to congratulate Mr. MacLeod for bringing these matters to light and I hope we shall quickly get some real reforms in this field through the Minister of Justice. It is true that the hon. gentleman, like the former ministers of justice, Mr. Fulton and Mr. Fleming, inherited a great many of these problems. Changes are not made overnight. But it is only when we raise our voices in the House of Commons that these reforms come about. I think one of the most shocking things revealed by this investigation is that there are young children of 12 and 13 years of age in our penitentiaries serving terms alongside hardened criminals. I wish to read from the February 23 issue of Weekend Magazine. Remember it was the hon. Davie Fulton who set up this investigation so that the facts could be brought before the Canadian people. This is what the article says:
It was difficult for me to find anything wrong with this cheery classroom in St. Vincent de Paul, near Montreal. It was brightly lit, well ventilated, had a good collection of books and educational aids for both public and high school courses and was presided over by a man anybody would have been proud to have had as a teacher.
The only thing wrong was that the children in this classroom, some of them no more than 14, were penitentiary inmates.
The federal training centre, an institution for offenders below the age of 25 which forms part of St. Vincent de Paul penitentiary, often gets 14 and 15 year olds as inmates.
Later, it is disclosed that children of the ages of 12 and 13 are serving terms of more than two years in the penitentiaries of this country. One of these children was so small in physical size that he was able to squeeze through the bars, the article says. It seems to me it is a disgrace in a country such as ours that we should have a situation of this kind in our penitentiaries. The article goes on to say:
Most have been convicted of theft, breaking and entering and automobile stealing. All have been sentenced to two years or more.
You see children in prison uniforms carrying history and geography books and arithmetic tables and you know they may be finishing their homework in their cells.
Not so long ago, a 12 year old boy found himself in St. Vincent's federal training centre.
And everybody in the prison for women in Kingston remembers the tiny 14 year old girl who went behind the walls to serve a two year term- for stealing a bicycle.
In Dorchester penitentiary in New Brunswick one of the boys was so small guards were afraid he might squeeze out between the bars.
If John Howard were to investigate some of the penitentiaries of this country he would be more shocked by the conditions there than by those he found in Britain during his

time. I may say I am happy to see the hon. member for Vancouver East in his place. He is one of the persons in this house who has pressed for prison and penitentiary reform over the years. He was doing so long before I came to this house. I am sure that some of that pressure rubbed off on Davie Fulton, the former minister of justice, as a result of which certain reforms and investigations took place. The article from which I have been reading goes on to say:
We are putting more children in penitentiary today than we were 10 years ago. Last year, we put away almost three times as many as we did in 1952.
This is a statement which was made by the commissioner of penitentiaries. This is not something we did 50 years ago; it is something we are doing today. Many people may ask: how did it come about? Well, under our criminal code children over the age of seven can be confined in penal institutions. That is shocking. The Minister of Justice should take a look at that, and there should be an amendment made immediately. Any child of the tender age of 7 to 12 years surely should not be confined in a penitentiary with hardened criminals. I could name one or two that are now released but I will not do so. It was alarm over figures like these showing a general penitentiary population increase that resulted in a five member justice department team going out across the country last year to examine the whole field of delinquency in Canada. The committee on juvenile delinquency was established by a former minister of justice, Davie Fulton, and made its report to former justice minister Donald Fleming.
I am quite sure the Minister of Justice has read the report. I hope he does something about it immediately. This is an urgent matter. It is something that should not be left for a year from now or two years from now. These children are still in the penitentiaries of this country. These children are like our own children, except that they ran afoul of the law, which could possibly happen to our own children. Because they ran afoul of the law and because the Criminal Code says that any child seven years of age or over may be placed in the penitentiary they have been coldbloodedly placed in the penitentiaries of this country with hardened inmates.
Imagine how you would feel, members of the House of Commons, if a son of yours eight or nine years old was in a penitentiary, if his only classroom was in a penitentiary, if the only place where he could study and do his homework if it is called homework in a penitentiary, was a cell.

The reason I am pressing this matter is twofold. We should do something for the youth of this country who have been categorized as juvenile delinquents. In the second place, the previous government promised to build a penitentiary at Drumheller worth approximately $4 million which was to be for young offenders. It was not to be the kind of institution surrounded by walls or fences but the kind that might rehabilitate some of these young boys and girls who have run afoul of the law. This is what the former government promised to do. There has been some suggestion that the previous government said it would not be built until 1964. I am not going to get into an argument with the Minister of Justice because I do not think I have ever had an argument with him and I do not think I can sell him on the idea of building a penitentiary in my riding.
It is quite clear to me that the penitentiary was to go ahead in 1963. There may have been some move made by the commissioner of penitentiaries to shelve the project for one year, but after I have set out additional facts with reference to these juveniles who are in our penitentiaries I should like to hear from the minister when the government intends to start the construction of this institution for young offenders, so they can be kept away from the kind of penitentiary described in the article that was written as a result of the findings of the commissioner of penitentiaries, A. J. MacLeod.
To come back to the point as to where it was to be built, may I say I am quite sure the Minister of Justice would respect the word of the former minister, Davie Fulton, in this regard. After this institution for young offenders had been announced there was a press report in July of 1962 in the Calgary Herald headed "Cutbacks Won't Hit Pen Work". It. reads in part as follows:
Cutbacks in government spending announced last week will not affect the decision to proceed with the $4 million Drumheller penitentiary, the Herald learned today.
An Ottawa source close to justice minister Davie Fulton said the Drumheller penitentiary and other new institutions are "fairly urgent business" because of crowded conditions in other Canadian prisons.
I do not know whether it is a good or bad thing but I might say Alberta is the only province in Canada that has no penitentiary of any kind. All people sentenced in Alberta to penitentiary are taken to Prince Albert in Saskatchewan. Conditions there are such that that penitentiary is badly overcrowded. Just imagine the overcrowding of men in that penitentiary, and the sending there of offenders 12, 13, 14 or 15 years of age.
I say to the Minister of Justice that this is an urgent matter. It is true that the previous minister was a Conservative minister and
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that there was an austerity program for a period of time, but I say to the present minister that he must review the position and consider it again. I have some other facts to put on the record with reference to the children in our penitentiaries, but when he speaks I should like to hear from him when the government plans on going ahead with the institution for young offenders.
Let us look at some of the facts as far as juveniles are concerned in this country. Canada's total penitentiary population was about 4,700 in 1952. In 1962 the figure was 7,100. Statistics indicate a penitentiary growth of 5 per cent per year and at the present rate of growth the population in 10 years will be 12,000. The largest increase of all is in youngsters 16 years and under. There were only 32 such admissions in 1952, but by 1962 there had been a 300 per cent gain. In other words, there were 300 per cent more children in the penitentiaries in 1962 than there were in 1952. To quote the article:
"I'm in a rage when I see these kids," J. C. A. LaFerriere. director of inmate training for Canada, told me when I visited St. Vincent's federal training centre recently.
He goes on to point out what happens at night. This is something that should be placed on the record. It is not a case of handkerchiefs and tears. These are facts.
"They cry at night and it breaks my heart. They have no right to put children in penitentiaries."
That was the recommendation made by the commissioner to the former minister of justice. That government then went to the country and was defeated. You, sir, are now the Minister of Justice and I hope you will do something about this soon.
In 1959, the latest year for which these statistics are available, 11,686 youngsters between 7 and 15 were adjudged delinquent in Canada. Of these, 19 were 7 years old, 92 were 8 and 212 were 9.
Of that number 32, plus 300 per cent, were confined to penitentiaries serving terms of two years or more with hardened criminals. In dealing with the increase of 300 per cent I want to refer to one story. This is the story of a little fellow called Henri and I want to show hon. members what happened to him.
There are many sad stories about children in prison but the case of a 12 year old Chicoutimi, Que., boy who will be referred to as Henri has gone down in penitentiary history as a classic. Henri had all the cards stacked against him.
This is not unusual.
He was the product of a shiftless father and a prostitute mother, who had separated. In his short lifetime he had been in all sorts of trouble. He had been sentenced to reformatories and at one time had been committed to a mental hospital.
Anyone who has had any experience with reference to juveniles who have been placed

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in custody and have come up on charges will appreciate that 60 per cent or 70 per cent of those children confined in penitentiary, and of the 11 thousand odd convicted of juvenile delinquency involving one crime or another, are the products of divided homes, so the fault is not theirs. The fault is ours in society and the fault is all the greater when we place them in institutions with hardened criminals.
The judge considered the matter for some time. The nature of the boy's previous offences indicated that he was in serious need of help. But there were no facilities for handling such a case. The judge finally sentenced Henri to two years in St. Vincent de Paul.
This was for striking a man whom he had found in a certain condition with his mother, as a result of which he was charged with assault. Let me tell you the story. He was so small and so young and he had no toys to play with. Even the guards in the penitentiary felt sorry for him and they took up a collection and bought him a bicycle so that he could ride around within the prison walls. This is Canada. This is the administration of justice in its practical sense which we are supposed to be proud of. The boy had one request to make. What was the request? One day he said to the guard, "Could I go outside these walls and play"? This boy, Henri, is 12 years of age. What was the answer? The rules do not permit criminals who are confined to the penitentiary to go outside the walls to play." This is our country.
I have raised this question before. I hope that tonight, now that I have raised it in the House of Commons, something will be done about it. I hope something will be done about it, not a week from now but tomorrow. Let us do something immediately about this. This could be your child, and these are Canadian children. The only thing they have done has been to run afoul of the law. Surely, what we should be doing today is putting these children in some kind of institution where they could be educated, where the proper environment would be provided. If they come from broken homes, surely they should be in institutions where they can be rehabilitated to enable them to take their places as men and women in society.


An hon. Member:: It has been done.


Eldon Mattison Woolliams: It may have been done, but just look at the record. Would you say tonight there are no juveniles in the penitentiaries? If you or the Minister of Justice can say that tonight, I will be the most happy person and I will take my seat. You cannot say it. I am sorry about this interruption because this is a very serious matter which affects the youth of our country.

I say to the minister, therefore, that there was a plan to build an institution for young offenders in Alberta. The land has been purchased and $100,000 has already been put into this project. The water has been put through to the site because of an agreement between the Department of Public Works and the city. Why does the government not proceed with this plan forthwith? If the government decides to stick by this decision to postpone the building of this institution until 1964, when will they start? How much will be built in 1964?
I want to deal with another matter, and that is the reason Drumheller was chosen as the site for this institution. Drumheller is one of the depressed areas of Canada. I am not talking about the farming area, but the mining area. Back in the fifties there were 20 mines operating. By 1962, there were six mines operating and today there are only two mines operating. In 1950, these mines employed 1,866 men. By 1963, only 183 men were employed. Now the Minister of Industry has removed Drumheller from the list of depressed areas. He said the statistics in the unemployment office revealed there were not too many unemployed. These men have been unemployed for a long time. They were unemployed in 1954, 1955, 1956 and 1957. They were unemployed when we were in office, but some of them went to Canmore, where they obtained employment in connection with the shipment of coal to Japan. They have been unemployed so long they have no unemployment insurance benefits left. They are not statistics in the unemployment insurance office. Therefore, when the minister removed Drumheller from the list of depressed areas, that was wrong.
They talk about rich Alberta, but there is no place in Canada where conditions are such as they are in East Coulee, Newcastle, Rose-dale and those areas which were coal mining areas surrounding the city of Drumheller. Even the former minister of labour agreed with this statement. When the demand arose in Canada for an institution to rehabilitate the youth, Drumheller was chosen because it was a depressed area. In addition, the province of Alberta was the only province in Canada which had no such institution. I say that to shelve this project until 1964 is an injustice to the youth of this country whom I have described and who are in our penitentiaries. It is an injustice to the unemployed men in that area who were brought there during the last war. During the last war there was a demand for the soft coal in that area and the men were brought from various parts of Canada. When the war ended, the market for soft coal disappeared because of competition with petroleum and natural gas.

These men were left there and they are a monument to the previous Liberal government.
I say these men were brought there during the last war. At least, I was frank enough to admit that whatever steps the Conservative government took in this particular area, they were not of much help. However, at that time the area was declared a depressed area and received some benefits under that particular legislation. The fact is that it would take a large pool of labour to build a penitentiary of this nature. The unemployment insurance office in the district said that they had such a pool of labour because the unemployed coal miners had become skilled in other trades and could be used on this project. For these two reasons, I press the minister tonight to get this project started so that there will be some attempt at rehabilitation of these children who have been convicted and placed in the penitentiaries of this country. I want to repeat that if John Howard, the great prison reformer, were to see some of the conditions under which these children are living he would be shocked. If he would be shocked now, in the light of conditions in his day when he brought about reform, one can readily envisage the conditions.
We can sit here, like corporation lawyers, who never go down to the police court. If they ever went down there, as one did recently to bail out his son, they would find that these places are in need of reconditioning. They are a disgrace. I refer especially to the places where people are held while awaiting bail. People say, you have a bill of rights, but try to get a solicitor when you are in one of these places. If you get one, then try to get bail. It might be your daughter or your son or it might even be you. I say this is one of the most disgraceful things we have in Canada today. I trust that the Minister of Justice will make sure that something is really done in connection with the reforms to which I have referred.


Mr. Deachman:: I enter this debate briefly this evening on the question of the recent changes in the price of sugar. This is a matter which has been mentioned in this house today, and recently by the hon. member for Lapointe. The intimations are that some kind of conspiracy exists in connection with the price of sugar, and that this is a question which should be brought before the Minister of Justice for reference to the restrictive trade practices commission. It is with this in mind that I should like to make a few remarks this evening.
Let us look first of all at raw sugar prices. By raw sugar prices I mean the prices which the manufacturer or refiner of sugar in
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Canada must pay in order to land sugar in Canada for refining purposes. Last year around this time the price was 6.5 cents per pound. The figures I shall give you are from the Financial Post, and the dates which I give you are the dates of the Financial Post on the day raw sugar prices are quoted. The price quotations for raw sugar per pound are, in the Financial Post of October 5, 1963, 8.2 cents; on October 12, it had moved up to 8.5 cents. On October 19, it had moved up to 9 cents, and in the current issue, October 26, raw sugar prices had moved up to 9.7 cents.
Now, what should cause the price of sugar to rise over a relatively short time at such a rapid rate?
Looking back over the course of the last couple of years we find that the world's production of cane sugar-and these are cane sugar prices I am dealing with-fell below world consumption by 3 million tons. This was the case in 1962-63, and also in 1961-62 production was slightly under consumption, so that for the past two years world inventories have been shrinking, and the cane sugar crop has not come up to world demand or world consumption. We may add to that the virtual removal of Cuba from the world trading market in sugar, as we know it.
Despite the shrinkage in production the sugar market responded early in the fall, as a result of optimistic predictions as to what the current sugar crop would be. On looking at the Financial Post of August 10, 1963, I see that in response to predictions that the crop would be fairly good the local refinery price, that is the finished sugar price in Canada, responded sensitively to this indication that prices would drop. I quote from that issue of the Financial Post:
Refinery price early this week was $13.45 per 100 pound bag in the Toronto area. This works out to 67.25 cents per five pound bag (there is an additional delivery charge.) Refinery price in late May-63 was 91.75 cents per five pound bag. This price now is down by 27 per cent in a little over two months.
As quickly as price changes appeared in the raw sugar market the local refinery markets reacted sensitively, and one could not call this a conspiracy to rig the price.
Let me deal for a moment with the question of what makes up sugar prices in Canada. First of all the Canadian sugar price is affected by the sugar tariff. This is an old, unchanged tariff dating back for a considerable number of years. In connection with this tariff I would like to quote from the 1957 restrictive trade practices commission report on the sugar industry in Canada. This says that the commonwealth preference tariff is 28.7 cents per 100 pounds, so that to get the Canadian price of raw sugar you must take

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the world price as it fluctuates on the raw sugar market and add the commonwealth preference tariff of 28.7 cents.
In addition to this you must add the proportion of commonwealth tariff averaged over the most favoured nation tariff appropriate to the commonwealth producer, and this amounts to about 85 cents, which must again be added to the raw sugar price per 100 pounds of raw sugar. Therefore the first element in fixing the price in Canada is the tariff upon sugar.
After the raw sugar has been landed, the price of refined sugar is affected by the following factors. First there is the raw sugar price related to the tariff as we have discussed it, and then the refining margin, which in this 1957 report at page 55 is quoted at $1.20 per 100 pounds, freight 80 cents, delivery $1.89, insurance .02 cent and other expenses totalling 20 cents.
Now let me deal with the question of inventory. Somebody mentioned in the house earlier this evening or this afternoon that inventories are excessively high and that sugar refiners in Canada are speculating in inventory and making enormous profits. I do not know what present sugar inventories in Canada are. Perhaps they are excessively high, but because raw sugar production in the world has been falling off, and was below the level of consumption in 1962-63 and 196162, one would not expect to find that inventories are excessively high. However, let us assume for argument's sake that they are; but inventories of sugar cannot be converted into dollars for speculative purposes until such time as the sugar is sold to the public.
How is sugar sold? Each one of us consumes approximately 96 pounds of sugar a year. This figure does not vary very much, so that in Canada we consume approximately one million tons of sugar a year. If we want to reduce that to a unit we can look at easily, it comes to 13.5 tons for the members of the House of Commons, which is quite a lot of sweetening to go into the people in this chamber-and one wonders whether it has always been effective. Therefore it is not likely that much speculation has taken place on inventories, because inventories are not converted into sugar and sold, except at a relatively even rate on a fixed annual basis of 96 pounds per person.
To sum up I want to say that while the sugar industry in Canada has tended to be monopolistic and is almost by way of a utility, because it must be made up of large concerns, it has been under constant investigation by the federal government to see that it does not fix the price and become burdensome
[Mr. DeachmanJ
upon the public. One government after another has had long experience in dealing with the sugar companies and, as a result of this, these companies have become relatively cautious about speculating in price and in rigging the price.
I conclude by saying that while there is reason to look very carefully at fluctuations in price of the kind that have taken place over the last few months, I submit that much of this is the result of world conditions, over which the Canadian industry has little control, and that that industry is not necessarily the culprit or the conspirator with regard to the present price.


Mr. Winch:: Mr. Chairman, I was most pleased to hear the remarks of the hon. member for Bow River exposing one of the problems still outstanding our penitentiaries system. It is my intention to speak on some of the other problems and difficulties. In my estimation, sir, there are two important matters upon which I feel the Minister of Justice should make a detailed statement. First, he should give us an expose on his theories on penology and how and when he intends to put his theories into practice. Second, he should explain to this house his understanding and theories relating to the problem-and it is a serious problem-of narcotic addiction, and tell us how and when he intends to tackle this problem. Dealing with the penitentiaries system first, to the best of my understanding the purpose of our penitentiaries system is for the punishment of those who are anti-social and have broken the laws of this country; and second, to the best of our ability to rehabilitate them, so as to make them upon their release from the penitentiary useful and law abiding citizens.
If we deal with the second question first as being most important, which I think it is, surely it should be axiomatic that in order to rehabilitate a person into becoming a useful and socially conscious person you have to change his mental attitude. Surely changing a person's mental attitude and bringing about his rehabilitation depends to a great extent upon his environment. I say, sir, that to a considerable extent the environment in our penitentiaries is an absolute disgrace to a country which calls itself modern and civilized. I am not completely, or to any great extent, blaming our penitentiary officials for this situation. The greatest onus or responsibility rests upon governments, past and present, and to a great extent upon Liberals who have made up the governments of the past. Because let us not forget the Archambault report of 1938. Judge Archambault outlined in detail a most positive, disgusting, disgraceful situation in the penitentiaries system of Canada. He pointed this

out completely even back in 1938. He said there were 400 cells in the St. Vincent de Paul penitentiary that were unfit for human occupation-unfit in 1938; and today those self-same cells are occupied by prisoners.
I only wish more members of this House of Commons would visit the federal institutions and see the conditions for themselves. I do not think the members of this house need worry about getting into a penitentiary or getting out, because I have always found that if I got in in the morning I always got out in the afternoon or evening. So there is no danger there. But I am convinced that if the members of this house would do this-* because this is part of our responsibility; we have a duty to deal with penitentiaries and penology-they would take immediate action to rectify the appalling conditions that were exposed by Judge Archambault in 1938. I say that not only to the male members of this house, but to the female members also. I wish the women members would visit the women's jail at Kingston. If they were to spend one day in that jail they would come back here and get action from the Minister of Justice to improve the conditions at that jail, or they would tear out what little hair he has left. The conditions at Kingston are appalling.
How are you going to rehabilitate these women when they have to live under such shocking conditions? This is an institution that was never meant to be an institution of this kind. It is absolutely outdated and obsolete. The laundry room is right next door to the boiler room, and the dozen girls who have to work in the laundry room do so in temperatures that reach 108 degrees. The steam pipe system in that institution is so terrible, so deplorable, that it is in a continuous sweat, and because of the continuous sweat the condensation of the steam is rusting the cells and everything in them.
They can paint the cells-as they do-in that institution and within a few weeks it is all stripped off; it sweats off. This is the type of institution in which these women are confined. You can go into the penitentiary at Kingson or St. Vincent de Paul and see these terrible conditions. I say that something is wrong with us if we do not do something about it. I do not believe we should mollycoddle these criminals; I do not believe we should pussyfoot with them. They are there because they have broken the law. They are there for punishment, yes. But they are there for rehabilitation also. We spend millions and millions of dollars on a so-called policy of trying to rehabilitate these people. How can we do it when they are confined in conditions such as these? In the St. Vincent de Paul penitentiary, for example, there are 'hundreds of cells in which there are no
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sanitary facilities; where there is a bucket alongside the so-called bed, into which you can respond to nature. And alongside the bucket is a little jar containing your drinking water. The sanitary bucket is cleaned out once a day, and many of these people are in the cells 24 hours a day. People talk about rehabilitation. We are pouring the taxpayers' money down the drain, and we are certainly not preparing these prisoners to lead useful lives.
During the last two years in particular we have had riots in our prisons. There have been riots in St. Vincent de Paul penitentiary which have cost the taxpayers over $2 million to repair the damage. Why? Because of conditions which no man could bear; because not only are there these conditions in the cells but there is also the question of food. Yes, the food is good. I do not think anybody confined in our penitentiaries today would complain about the quality, quantity or preparation of the food. But these men have to go and pick up their food, and the distance is so great from the place where they collect their food to their cells that by the time they get back to their cells the food is cold. Therefore for three meals a day you are eating a cold-plate, and food which is supposed to be eaten hot, but which is eaten cold, does not taste very good.
Adding all these things together, no wonder we have had riots and the complaints. Then when they do riot-and nobody can commend them for rioting-they are put into segregation cells. I am not talking from hearsay; a number of us spent a day there. What did we find? We found men who are ringleaders, who are dangerous, who are mentally unstable, emotionally upset, easily aroused, incarcerated in these cells week after week after week after week. They were never let out of the cell for even a half hour of recreation. Why? Because there was not a gate unlocked leading to the recreation section. The contractor had not done his work properly and the Department of Public Works had not seen that something was done about it. I know they were asked to do something time after time. Yet men of this type, who become easily aroused, are confined in these cells week after week and their mental condition is worsened to the state where they are incited to riot. These situations cannot be allowed.
Hon. members have all read in the newspapers about the cockroaches, the vermin, the rats that infest our penitentiaries. The warden at St. Vincent de Paul employs a man who does nothing else all day and every day but go around with exterminating material trying to kill this vermin. If you had 100 men going out every day you would never get rid of them, because as fast as

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you killed them they would come up the sewers and drains and start all over again.
In addition, when are we going to get away from solitary confinement? If any hon. member does not understand solitary he should visit a penitentiary and ask the warden to lock him in a small cell without a watch. Then when he thinks five minutes is up, let him kick the cell door open and he will find that he has been there most likely for a minute and a quarter or a minute and a half. I was asked to try that and I did. I asked others to do it and they did. When I felt five minutes was up in actual fact it was only a minute and a quarter. Men are put in solitary on occasion for days and days with no human contact, nothing but the bare walls. We have to do something about this. I am pleading that we do something about it, and the responsibility for any delay rests in the hands of the government.
I know for a fact that A. J. MacLeod, the commissioner of penitentiaries, has for a considerable time had a development plan for penitentiary construction consisting of maximum security, medium security and minimum security prisons. Up to a few weeks ago you could go down to the offices of the commissioner of penitentiaries and in the lobby you would see a model prison, comprising the workshops and accommodation, of modern construction and architecture, so well thought out that looking ahead to the time when we have partially resolved our criminal problem and the numbers in institutions diminish it can be reconverted quite easily to other uses, such as a hospital for the aged or other purposes. But those plans which are now on the drafting board have to be put into operation. If my memory is correct the thinking and planning of the commissioner of penitentiaries extends over a period of seven years, with a completion date in 1970. I say that, although I appreciate his thinking, 1970 is too late.
We have to do away now with the present type of maximum security prison and build a new type. We have to speed up the building of minimum and maximum security prisons, and we must insist that this be done. The longer we delay, the more will building costs go up; second, it will cost more in human lives because we will not be able to rehabilitate the hundreds and thousands over this seven year period in these institutions under existing conditions in the maximum security prisons we have today. I speak particularly of maximum security prisons because I think an excellent job has been done in minimum and medium security institutions I have seen of recent construction which are minimum and medium security prisons. But if we allow the present condi-

tions of occupation to continue, then we will again waste millions of dollars of taxpayers' money, not only because we cannot rehabilitate these people but because we are inviting more and more riots and destruction. So from whatever angle the problem is examined, there surely can no longer be any pussyfooting, and if we do not do anything more this year we must start removing the conditions of which Judge Archambault complained in 1938.
That is all I have to say, Mr. Chairman, on the penitentiaries problem because I want to say a few words about another serious problem, that of narcotics in Canada. I hope the minister will give us a somewhat detailed exposition of his approach in handling this matter. Personally I feel from years of studying the matter that we are not tackling it in the right way. We still seem to have the opinion that narcotics addicts should be treated as criminals when every authority, or practically every authority, in the world says that they should be treated as sick people. I was most interested to read the other day a report of the New York academy of medicine's subcommittee on drug addiction, which among other things said this:
There should be a change In attitude toward the addict. He is a sick person, not a criminal. That he may commit criminal acts to maintain his drug supply is recognized; but it is unjust to consider him criminal simply because he uses narcotic drugs.
The academy believes that the most effective way to eliminate drug addiction is to take the profit out of the illicit drug traffic and proposed a national network of federally-controlled dispensary clinics at which addicts could receive low cost drugs. In the same study which was later carried on by the United States medical association's council on mental health, an examination was made of various systems in the world, particularly in the United Kingdom. While they have a cautious view of the system used in the United Kingdom, they found that it was of such importance that they felt they should quote one of the regulations, and I should just like to put it on the record:
It has been demonstrated that the patient, while capable of leading a relatively useful and normal life when a certain minimum dose is regularly administered, becomes incapable of this when the drug is entirely discontinued.
I completely agree with that view, Mr. Chairman, but I am afraid that there has not been the approach by governments in the past, or the Department of Justice, to lead to the necessary educational program to bring to public understanding the meaning of this disease of narcotic addiction. I know from experiences I have had that some people who were narcotics addicts were so badly addicted that in order to feed their need they were in and out of

penitentiaries year after year for crimes of breaking and entering to get the money required to buy heroin. I know where these individuals were able to get a doctor to give them treatment, but they could not be cured and were given a minimal dose. The doctor saw to it that they were able to get that minimal dose and they are getting it today; and after seven years in one case and nine years in another those two individuals have never again broken the law but are useful members of society.
This experiment has been proven time after time in the United Kingdom and other countries, and I ask why we give no thought to that. I admit I am disturbed by our present policies. We are now letting or have let the contract for a $4 million structure a few miles outside of Vancouver in which we will institutionalize the drug addict as a criminal. In the light of experience accepted throughout the world, the experience of the New York academy of medicine and of the American medical association, it is not possible to cure these people by confining them under compulsion in the manner now proposed. It is necessary to change their mental attitude, and that cannot be done by collecting them from all over Canada and incarcerating them in one huge institution under the criminal law. There is one particular aspect of this treatment which concerns even those who are ready to approve what the government plans to do as being, at least, a first step. I am referring to arrangements for the after care of those we propose to rehabilitate. What is going to happen to these people once they are released? This is the danger point, the point at which there must be rehabilitation, the point at which employment must be found and when the individual must be re-integrated into society. Unless this work forms a major part of our narcotic addiction treatment policy we will be wasting money when we spend this $4 million or whatever it will cost to build this institution outside Vancouver.
There are different viewpoints, but I do not think we shall solve this narcotics problem until some system is arranged whereby the profit is taken out of the sale of illicit drugs. As long as there is the possibility of a profit, somebody will try to make somebody else an addict. We know we have addicts who must obtain certain drugs until they can be cured. Why, in the name of heaven, do we not make arrangements whereby they can get them legally, without having to go into the illicit market where the profiteer gains his living? I think our laws should be particularly stringent as applied to any pedlar of narcotics who is not himself an addict. I think that such people should get life imprisonment because of what they are doing. This problem
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will always be with us until we bring in policies establishing dispensaries, so that those who need these drugs are not forced to go into the illicit market.
I am seriously concerned about these matters and I sincerely hope the Minister of Justice will do us the courtesy to make a statement on the situation, possibly when we get into the estimates in more detail. I have had the privilege of seeing and discussing the plans and programs of the commissioner of penitentiaries, and I sincerely hope the minister will be able to put the hooks on the Minister of Finance so that funds will be available with which to proceed in a civilized manner, so as to make Canadian penology the most admired in the world.


Mr. Baldwin:: I had intended to make reference to a number of unrelated subjects which come under this item, but having in mind the lateness of the hour I shall restrict my remarks to a brief comment on the statements made by the Prime Minister and the Minister of Justice tonight.
I am happy to say that these statements indicate that the government recognizes there is a problem. That is the first requirement, the first step toward a solution. But in my opinion, recognition of the problem has not been followed by an adequate solution. I should like to refer briefly to what the Minister of Justice has said. He said: "As the Prime Minister has stated, the purpose of our security program is preventive, not punitive". If that statement is intended to relate to the criminal law, it has never been my understanding that the criminal law was punitive. It, too, is intended to be preventive. Our system of criminal law administration is by no means perfect. All such systems are imperfect. But I would say this-that in our experience we have reached a greater measure of perfection than any other system. This is because our trials take place in open court. There is a confrontation of accused and witnesses. Here, in these circumstances, with a judge sitting high on a dais, dressed in sombre robes, in the presence of friends, and witnesses subject to cross-examination by learned counsel, we come close to purifying the stream of justice. I recognize, of course, that in cases such as those the minister has in mind we cannot reach this measure of perfection but, I suggest, we could go a lot further than the government has seen fit to go today without imperilling our security.
I have two suggestions to make, and I will put them briefly before the committee. Is it not possible that a digest of the statement made in respect of each employee whose position is imperilled could be given to him, not in such a way as to permit him to identify



Business of the House the person providing the statement against him but at least so as to permit him to know in what respect he is charged, in order that he might have an opportunity to meet those statements. Second, having in mind the degree of unanimity necessary to protect the people who are making the statements, surely these witnesses could be subjected to at least some measure of scrutiny or cross-examination either by this tribunal or by an agent of the tribunal. This would not go as far as I would like to go, but if they were adopted we might come a little closer to providing a more equitable system.
May I call it 10.30?
Item stands.
Progress reported.



BUSINESS OF THE HOUSE

Gordon Minto Churchill: I should like to ask the acting leader of the house if he can tell us whether the business for Monday and Tuesday remains as a supply motion.


Mr. MacNaughi:: On Monday the Minister of Finance will move to go into supply. I regret I cannot give any further details of the legislative program for the balance of the week. I understand that talks are going on between the representatives of the various parties and that early in the week a statement will be made concerning the program for the rest of the week.


[Stage Direction]
It being twenty eight minutes before eleven o'clock the house adjourned, without question put.