1963-11-12

Mr. David Orlikow (Winnipeg North):: Mr. Speaker, I rise on a question of privilege. On numerous occasions in this house questions have been asked of the government in respect to the proposed move of the T.C.A. repair facilities from Winnipeg to Montreal. The matter has been debated on various occasions in the house, and an important factor in the decision to move the repair base was a report submitted to the management of T.C.A. by a management consultant organization, Dixon-Speas.
On numerous occasions members of the house, as well as the government of the province of Manitoba, have asked that this report be made available to them so that the information and recommendations contained in it could be analysed and assessed. To date the government has refused to make this report available, either to members of the house or to the government of Manitoba; yet the Winnipeg Free Press of November 5 carried a report that the hon. member for Winnipeg South (Mrs. Konantz) wired the Prime Minister urging the appointment of a new person or tribunal to study the whole question.
The same news story reports that the Prime Minister replied that such an appointment would be an evasion of the government's responsibility and merely another delaying action, and the Prime Minister suggested that:
-the government of Manitoba and appropriate bodies in Winnipeg put forward all the evidence they could assemble on these other factors.
The same issue of the Winnipeg Free Press reports:
Mr. Pearson's telegram was read at the Winnipeg South Liberal association meeting Monday night. Mrs. Konantz said she had seen the Dixon-Speas report and could understand why it could not be made public. She said it contained information which could not be given to Canadian Pacific Air Lines, T.C.A.'s main competitor.
My point of privilege is that members of the house and the Manitoba government have been refused access to this important document upon which rests the main argument
for the movement of T.C.A. repair facilities from Winnipeg to Montreal, while the document has been shown to the hon. member for Winnipeg South. This demonstrates again partiality to government members and is an infringement of the rights of all other members of the House of Commons.


Mr. Speaker:: Is there any other member who wishes to speak to this question?


Mr. Knowles:: We would like to hear from the Minister of Transport.


Hon. G. J. Mcllraith (Minister of Transport):: Mr. Speaker, I regret that I only heard part of the statement as I was coming into the chamber. However, if I heard it correctly it raises a very important matter. Certainly I would want to consider it quite carefully before making a statement on it, because this report has not been shown even to my colleagues. Probably I should not develop the subject without knowing what was said by the hon. gentleman. Perhaps I should look into his statement quite carefully when I have the actual text.


Right Hon. J. G. Diefenbaker (Leader of the Opposition):: In this connection, may I say that this appears to be another step toward contempt of parliament, and I should think the Prime Minister would be the one who would answer as to whether information was made available to the Liberal association of Winnipeg that has been denied to the parliament of Canada.


Right Hon. L. B. Pearson (Prime Minister):: I can deny that statement at once. Naturally I would be very glad to look into the report that has been given to the house from the press, and, either the Minister of Transport or I, if there is anything to be said on this matter, will say it in the house. Surely we cannot be expected to comment on a newspaper report of this importance without having had an opportunity to look into the matter. However, as far as the hon. gentleman's statement is concerned, I can deny it at once.


Mr. Speaker:: I have to decide whether there is or is not a question of privilege. Once more I should like to refer to Beauchesne's fourth edition, citation 113, which reads in part as follows:
Members often raise so-called "questions of privilege" on matters which should be dealt with as personal explanations or corrections, either in

Question of Privilege
the debates or the proceedings of the house. A question of privilege ought rarely to come up in parliament. It should be dealt with by a motion giving the house power to impose a reparation or apply a remedy.
I noticed that no motion followed the question of privilege. In the circumstances I must rule this is more in the nature of a criticism or a complaint than a question of privilege.


David Orlikow: May I say that I shall be glad, after I hear the statement by the minister explaining precisely what has happened in this matter, to move a motion tomorrow or whenever the minister may make his statement.


Mr. T. C. Douglas (Burnaby-Coquitlam):: think it should be made clear this is not merely a complaint. The hon. member is raising a matter which is of vital concern to the privileges of this house, in that a document which has been denied to members of parliament and the government of Manitoba allegedly, according to the press, has been made available to a member of this house sitting on the government side. This is certainly a matter of privilege and not merely a complaint, if the hon. member's own statement is correctly reported. I think an explanation is due from the government as soon as they have an opportunity of interviewing that member and finding out whether she actually made the statement attributed to her.


Mr. Speaker:: As I said before, there is no doubt about the importance of the matter. However, if it is that important it should be followed by a motion. No motion was presented this morning. I do not mind taking the matter under consideration for a day or so. I think we will just leave it there, and I will take it under consideration and give a final decision tomorrow.

On the orders of the day:


Mr. W. H. Jorgenson (Provencher):: Mr. Speaker, I would like to direct a question to the Minister of Transport. Could the minister tell us whether he has shown a copy of the Dixon-Speas report to the hon. member for Winnipeg South?


George James McIlraith: Mr. Speaker, I think that question is wrapped up with the allegation made by the hon. member for Winnipeg North. I did not hear the whole of that allegation; I heard only the latter part of it, and it seems to me it is of the utmost gravity and seriousness. Therefore I would prefer to take the question as notice and leave it to be answered with the other.


Warner Herbert Jorgenson: I presume then the answer is yes.


George James McIlraith: The hon. member has no right to make any such presumption.


Mr. Fleming (Okanagan-Revelstoke):: How
could he make anything else?


Stanley Howard Knowles: Mr. Speaker, may I ask the Minister of Transport or the Prime Minister whether arrangements have been made with a delegation from Manitoba to meet with the federal government, concerning the question of the transfer of the T.C.A. overhaul and maintenance base from Winnipeg and, if so, what will be the date of that meeting?


Lester Bowles Pearson: Mr. Speaker, to my knowledge there has been no request for another meeting, but I will have to look into that matter and see if a request has come in over the week end. If a request is made, naturally we will be very glad to receive the delegation.


Stanley Howard Knowles: Mr. Speaker, may I direct a question to the Minister of Transport. Does the minister need notice to answer the question whether or not he showed the Dixon-Speas report to the hon. member for Winnipeg South?


George James McIlraith: The answer to that question would be no.


Stanley Howard Knowles: As a supplementary question, in view of the minister's clear statement that he does not need notice, then will he not now answer the question?


George James McIlraith: Well, it should be perfectly clear to the hon. gentleman that I did not show it to the hon. lady. The question arises out of the press release referred to earlier. I did not hear the statement made by the hon. member for Winnipeg North, except the latter part of it, and since that time I have tried to obtain a copy of his statement. Regrettably, I have not been able to obtain it because he had only one copy and it has gone to the Hansard staff. He did however send me the press clipping, the latter part of which there is an allegation to the effect that the hon. member saw the report. I certainly did not show the report to the hon. member.


Warner Herbert Jorgenson: On a supplementary question, perhaps I can help the minister here. I have a copy of the Winnipeg Tribune of November 5, and in quotation marks there is a statement made by the hon. member for Winnipeg South:
"Mr. Mcllraith showed me the Dixon-Speas report last week in Ottawa and I can understand why it cannot be sent out at this time".


John George Diefenbaker: That is a loaded question.


Mr. Pickersgill:: It is a loaded quotation. [Later:]


Stanley Howard Knowles: Mr. Speaker, earlier today you indicated that you would consider between now and tomorrow the question of whether or not there is a prima facie case of privilege on the point raised by the hon. member for Winnipeg North. I rise to ask that in considering this you will bear in mind the statements now given to the house, one by the hon. member for Winnipeg South, through the press, that the Minister of Transport showed her the Dixon-Speas report, and the other a denial by the Minister of Transport. Surely in the light of these statements, if substantiated, there will be a prima facie case of privilege for a motion tomorrow.


John Whitney Pickersgill: Mr. Speaker, since the hon. member for Winnipeg South is not here, it would perhaps be chivalrous and also courteous for the house to let the hon. lady speak for herself before we reach a final decision on whether any question of privilege exists.


Stanley Howard Knowles: Is not the Secretary of State aware that she spoke for herself at the Liberal association meeting?


John Whitney Pickersgill: That is a newspaper report. BROADCASTING ACT



AMENDMENT TO CHANGE NAME OF CORPORATION

Mr. Jean Chretien (St. Maurice-Lafleche) moved: for leave to introduce Bill No. C-104, to amend the Broadcasting Act.


Some hon. Members:: Explain.


Joseph Jacques Jean Chrétien: Mr. Speaker, the object of this bill is to substitute for the names Canadian Broadcasting Corporation and La Societe Radio-Canada a name having the same meaning in both official languages; Radio-Canada. [Text]
Motion agreed to and bill read the first time.



CANADIAN FLAG


[Stage Direction]
On the orders of the day:
John George Diefenbaker: Mr. Speaker, would the Prime Minister tell the house what answer he gave yesterday to the delegation from the Royal Canadian Legion which asked that the Canadian ensign be continued as, or redeclared to be, the national flag of Canada?
Inquiries of the Ministry


Lester Bowles Pearson: Mr. Speaker, I was not asked by the delegation which I had the privilege to see to give any answer to their statement on this matter, and no answer was given. I repeated to them, however, the commitment that this government had entered into for the production through parliament of a Canadian national flag within two years of being elected.


John George Diefenbaker: Would the Prime Minister say whether such a flag will come before parliament, or simply be declared by way of order in council to be the national flag of Canada?


Lester Bowles Pearson: This is a very important question of government policy and procedure affecting action to be taken in the future, and I do not think the matter can be dealt with on orders of the day.


John George Diefenbaker: Mr. Speaker, this is a matter of importance now in view of the representation made yesterday. I therefore ask the Prime Minister whether he will give the house the assurance that the government does not intend to take direct action in this regard by order in council.


Lester Bowles Pearson: Indeed, Mr. Speaker, I will be delighted to give the house that assurance.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Thomas Clement (Tommy) Douglas: Mr. Speaker, may I direct a question to the Prime Minister. The NATO parliamentarians' conference have brought down a report from their military committee in which they describe the United States proposal for a mixed manned nuclear force as a military superfluity and therefore a waste. They go on to say that any increase in the nuclear force at the disposal of NATO would be superfluous.
I wish to ask the Prime Minister to what extent the Canadian government accepts this recommendation and agrees with it; and whether these views are being taken into consideration in the formulation of Canadian policy on defence and external affairs.
Righl Hon. L. B. Pearson (Prime Minister):
I have not seen the report in question, but I shall have the privilege of consulting with the chairman of the Canadian parliamentary delegation to the conference at lunch today. As far as a multilateral nuclear force is concerned, the position taken by the Canadian government regarding its participation has already been declared. As to the general

Inquiries of the Ministry question, I think I should wait until I have consulted with the chairman of the delegation and studied the report.



DEFENCE PRODUCTION


[Stage Direction]
On the orders of the day:
Hon. Leon Balcer (Three Rivers):: I wish to direct a question to the Minister of National Defence. Could the minister tell us why he did not ask for price quotations from Canadian shipyards for building submarines in Canada?


Hon. Paul Hellyer (Minister of National Defence):: Because there has been no requirement for submarines, except for the three training ships which were ordered as part of production sharing arrangements.


Léon Balcer: Why did the hon. gentleman not inquire among Canadian shipyards to see whether it would have been possible to build submarines in Canada before these three training submarines were ordered?


Paul Theodore Hellyer: I am sure it would have been possible to build them here. I do not know what the price would have been. But, as I tried to make clear to the defence committee, this was a production sharing arrangement involving other considerations, and it was on that basis that the decision was made.



CLARESHOLM, ALTA.  DISPOSITION OF FORMER R.C.A.F. BASE

[Stage Direction]
On the orders of the day:
Mr. R. N. Thompson (Red Deer):: Mr. Speaker, I direct my question to the Minister of Industry. What are the present plans of the government regarding disposal of the buildings and the property of the former R.C.A.F. base at Claresholm, Alberta?


Hon. C. M. Drury (Minister of Industry):: Mr. Speaker, this has been a somewhat long and difficult disposal problem with respect to Claresholm. I am glad to say that negotiations are now under way with the government of the province of Alberta looking toward an early conclusion of this particular problem.



ARTS, LETTERS AND SCIENCES ROYAL COMMISSION    SUGGESTED REDEFINITION OF TERMS OF REFERENCE

[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Port Arthur):: I should like to address a question to the Prime Minister arising out of public discussion relating to preliminary hearings of the royal commission on biculturalism. I should like to ask

the Prime Minister whether he has given any consideration to redefining or reissuing the terms of reference of the commission, particularly as the discussions appear likely to involve the federal-provincial conference.


Lester Bowles Pearson: No. It was felt that the original terms of reference would be satisfactory for the purpose we had in mind. If as a result of the hearings now being held the commission itself feels there should be some change in the terms of reference, we would be pleased to consider the matter with the commission.


Mr. Gilles Gregoire (Lapointe):: Mr. Speaker, may I ask a supplementary question? Is the Prime Minister thinking of inviting observers from the royal commission on bilingualism and biculturalism at the next federal-provincial conference to be held in November of this year?


Lester Bowles Pearson: I do not think that would be a very constructive idea.


Gilles Grégoire: Mr. Speaker, I have another supplementary question to put to the Prime Minister.
Since it seems obvious that the main stumbling block at present is the taxation question, does not the Prime Minister feel it would be a good thing if the members of the royal commission were made aware of the opinions of both parties as regards tax redistribution?


Lester Bowles Pearson: It might be of some interest to them, as it would be of interest to the royal commission on taxation and to the royal commission on health problems.

On the orders of the day:


Mr. L. J. Pigeon (Jolieite-L'Assomption-Monicalm):: Mr. Speaker, I should like to direct a question to the President of the Privy Council.
Does the minister intend to revoke the terms of reference of the royal commission on bilingualism and biculturalism, since the "Conseil de la vie frangaise", through Mr. Florian Carriere, has found the commission's terms of reference to be unconstitutional due to the fact that culture, the same as education, comes under provincial and not federal jurisdiction?


Hon. Maurice Lamoniagne (President of the Privy Council):: No, Mr. Speaker.


Louis-Joseph Pigeon: Mr. Speaker, may I ask a supplementary question?
Could the minister tell the house whether he will ask the commission to begin by recognizing both the existence and the equality of the two nations, as suggested by the St. Jean Baptiste societies, so that the work of the commission will not be hindered?


Maurice Lamontagne: I believe the terms of reference of the commission are sufficiently clear on that subject.



WATER RESOURCES


[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kootenay West):: wish to direct a question to the Secretary of State for External Affairs. It is logical, topical and national in scope.


An hon. Member:: The Kettle valley railway.


Herbert Wilfred Herridge: My question is based on the fact that Canada has complete control of the Peace and Athabaska rivers and can divert these waters for the use of prairie consumers whenever required in the future.
Would the minister inform the house whether serious consideration is being given to the proposals made by the government of Saskatchewan for diversion of 6,000 cubic feet per second of water from the Columbia to meet the near future consumptive needs of the prairie provinces before Canada loses the right to divert such a quantity of water under the proposed treaty?


Hon. Paul  Marlin@Secretary of Stale for External Affairs: I have had a considerable amount of correspondence with the premier of Saskatchewan on this very subject. The premier has made public the correspondence between the two governments concerned. I felt that this was not the way in which to conduct public business, but since the hon. member has asked this question I shall be glad to table the correspondence I have had with the premier of Saskatchewan on this matter.
I might also say that there are no provisions in the proposed Columbia river treaty which derogate from or purport to interfere in any way with the right to use the waters of the Columbia river system in Canada for consumptive purposes. The phrase "consumptive uses" is defined in the treaty as use which would meet demands for irrigation purposes.


Herbert Wilfred Herridge: A supplementary question, Mr. Speaker. When the Secretary of State 28902-5-294
Inquiries of the Ministry for External Affairs says there is nothing in the treaty that prevents use for consumptive purposes, does that mean we can divert 6,000 cubic feet per second from the Columbia under the proposed treaty?


Mr. Martin (Essex East):: That means that the demands of irrigation are not in any way involved or precluded under any term in the Columbia river treaty.


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
Hon. Paul  Marlin@Secretary of State for External Affairs: Mr. Speaker, at this time perhaps I might deal with the question asked on Friday by the Leader of the Opposition and that asked on Thursday by the hon. member for New Westminster with regard to the autobahn to Berlin.
I should say at once, of course, that we reject the implication in at least one of the questions with regard to the recent incident; it was suggested that the incident arose from provocative action on the part of the United States. On the contrary, the incident was the third in less than a month when the Soviet union has interfered with legitimate allied traffic.
There has, therefore, been no need on the part of Canada to make representations to the United States authorities. Throughout the recent incidents United States policy and resultant actions have been closely co-ordinated with the United Kingdom and France, who share primary responsibility concerning Berlin. We have been, of course, in close contact with the United States and our NATO allies who have acted in this matter, I believe, with care and restraint.
Although focused on what may seem to be minor points of procedure, incidents of this kind represent a continuing pressure by the Soviet union on the essential western right of free access to Berlin. They serve both as a reminder that this divided city remains a serious friction point in the improved east-west atmosphere and as a warning that the basic issues between east and west remain unsolved. Moreover, they reflect the ambivalent policy of the Soviet government, which on the one hand proclaims a policy of peaceful co-existence and, on the other, has recourse to military pressures in situations like those surrounding western rights of access to Berlin.
It is, of course, our view that all countries should seek to avoid provocative action particularly in delicate situations such as Berlin. We therefore hope that the Soviet union will ensure that their forces on the Berlin

Inquiries of the Ministry autobahn will cease to mar the improved atmosphere in east-west relations by such pressures, and will approach relations with the west in a manner which will be conducive to the conclusion of further and, we would hope, important agreements.


John George Diefenbaker: Mr. Speaker, that free access to Berlin for the three powers is essential is not denied by any Canadian. In view of the rather lengthy reply by the Secretary of State for External Affairs, in which he pointed out particularly the shortcomings of the U.S.S.R. in this regard, I ask him whether he has made any representations to the ambassador of the U.S.S.R. as to the need of there being no provocation on the part of the U.S.S.R.


Mr. Martin (Essex Easi):: On this specific point I have made no such representations to the ambassador of the Soviet union in Ottawa, but I have talked with the ambassador on a number of occasions about various matters and I have made suggestions which I believe, if followed, could considerably improve relations between east and west.


[Stage Direction]
On the orders of the day:
Mr. Heath Macquarrie (Queens):: Mr. Speaker, I have a question for the Secretary of State for External Affairs. It arises from a hot dispatch from Newfoundland to the effect that the premier was invested with the grand cross of Prince Henry the Navigator, thereby entitling him to be called Sir Joey. Does this indicate a reversal of policy on the government's part with respect to titles?


Hon. Paul  Marlin@Secretary of State for External Affairs: Mr. Speaker, the answer to that question is, of course, that there has been no change of policy, unless the hon. gentleman wishes voluntarily to assume one.



INDUSTRY


[Stage Direction]
On the orders of the day:
Thomas Clement (Tommy) Douglas: Mr. Speaker, may I direct a question to the Minister of Industry and ask him whether the atomic energy control board have recommended that the heavy water plant which is in contemplation should be located in the Crowsnest pass area and, if so, is this recommendation going to be accepted by the government?


Charles Mills (Bud) Drury: Mr. Speaker, the atomic energy control board

have not recommended that the heavy water plant be located at Crowsnest pass.


Thomas Clement (Tommy) Douglas: May I ask the minister what location they have recommended?


Charles Mills (Bud) Drury: They have made no recommendation as to location.



DOMINION-PROVINCIAL RELATIONS QUEBEC    REPORTED AMOUNT OF PAYMENTS FROM FEDERAL TREASURY

[Stage Direction]
On the orders of the day:
Mr. Gerard Girouard (Labelle):: Mr. Speaker, may I put a question to the Minister of Finance?
I know that without being given notice of my question, he will not be able to give me the exact figures, but I would like to know if the premier of British Columbia's statement to the effect that the province of Quebec has drawn last year $69 million more than it had paid in the federal treasury seems sensible? [Text]


Hon. Walter L. Gordon (Minister of Finance):: Mr. Speaker, I do not know exactly what the Premier of British Columbia said. I will look it up and give my hon. friend an answer tomorrow.



REQUEST FOR ACTION RESPECTING RISING PRICES

[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: Mr. Speaker, I wish to address a question to the Minister of Justice, which has just come to mind. In view of the fact that sugar is now selling at 22 cents a pound in the province of Quebec, has not the time arrived for drastic action on the part of the government to meet the situation?


Hon. Lionel Chevrier (Minister of Justice):: Mr. Speaker, I do not know whether the hon. member was in the house last week when, in answer to a somewhat related question put by his leader, I said it was the intention of the Minister of Trade and Commerce to deal with this matter in a statement in the early part of this week, and I understand that is still the intention of the minister, sometime either today or tomorrow.


Mr. Howard:: What about British Columbia?


Lionel Chevrier: He will deal with the British Columbia situation as well.

Inquiries of the Ministry
HISTORIC SITES AND MONUMENTS	AGRICULTURE



REQUEST FOR FEDERAL AID IN RESTORATION OF OLD QUEBEC

[Stage Direction]
On the orders of the day:
Louis-Joseph Pigeon: Mr. Speaker, may I put a question to the Minister of Northern Affairs and National Resources?
Does the federal government intend to share financially in the restoration of old Quebec, that is its historical section, as it does at the present time for the fortress of Louisburg?


Hon. Arthur Laing (Minister of Northern Affairs and National Resources):: Mr. Speaker, in reply I might say we have had no representations in respect to this matter at all.


Louis-Joseph Pigeon: A supplementary question, Mr. Speaker.
Should the minister receive an official request from the government of the province of Quebec, would he comply with such a request?


Mr. Speaker:: This question is out of order, and I think the first question should have been on the order paper.



BUSINESS OF THE HOUSE


[Stage Direction]
On the orders of the day:
Gilles Grégoire: Mr. Speaker, I have a question for the Secretary of State. Could he tell the house when he intends to appoint the joint committee of the Senate and the House of Commons on the problem of consumer credit, and when will that committee start to function?


John Whitney Pickersgill: I understand, sir, that on Friday the house agreed to set up this committee, and I have no doubt that my hon. friend the Solicitor General and the assistant government whip- because the chief whip is ill-will be in touch with hon. members in other groups and parties in the house right away with a view to getting the appropriate personnel.
28902-5-2944



REQUEST FOR RE-ESTABLISHMENT OF SUBSIDY

[Stage Direction]
On the orders of the day:
Hon. Theogene Ricard (St. Hyacinlhe-Bagoi):: Mr. Speaker, I have a question for the Minister without Portfolio. As the selfappointed champion of our farmers, does he intend to submit representations to the government and ask for the re-establishment of the 25 cents grant per hundred pounds of milk, the abolition of which has inflicted a loss of $6 million on our milk producers?


J.-H.-Théogène Ricard: Mr. Speaker, I should like to direct a supplementary question to the Minister without Portfolio. Does his refusal to answer the question indicate the extent of his interest in the farmers' problems?


Mr. Speaker:: Order.



FINANCE


[Stage Direction]
On the orders of the day:
Hon. Mitchell Sharp (Minister of Trade and Commerce):: Mr. Speaker, on Friday last the hon. member for Burnaby-Coquitlam asked me a question arising out of a newspaper report of a speech made by the president of the B. F. Goodrich Company concerning United States tariff treatment of certain imports from Canada, tractor tires and rubber sealing strips, and he asked me specifically whether there is any retaliatory action involved by the United States.
I stated at that time I was confident there was no retaliation, and I would like to confirm that. About a year and a half ago, in May 1962, the United States enacted the U.S. tariff classification act of 1962, which was the latest of a series of laws enacted with the purpose of simplifying and modernizing their tariff schedules. U.S. law specifically states that the intent of this reclassification is not to raise duties, but there are increases and decreases in rates of duty involved in the application of the new U.S. tariff classification law, resulting from the rewriting of the schedules. The law was proclaimed on August 21, 1963 and brought into effect by the United States on August 31, about two and a half months ago.
We have been concerned for some time past about the fact that rates of duty on a number of products such as farm tractor
4614	HOUSE OF COMMONS
Lack of Consultation with Provinces tires would be effectively increased by the new classification, and we have drawn these concerns directly to the attention of our United States counterparts. As regards rubber sealing strips exclusively for automobiles, I am informed that no change is involved. The United States has undertaken to consult with Canada and other members of the general agreement on tariffs and trade, to assess precisely what tariff changes are involved in the new classification, and to seek mutually satisfactory solutions for any inherent problems. We will be pursuing these matters thoroughly in the consultations with the United States.


Walter Lockhart Gordon: that the house go into committee of supply.



LACK OF CONSULTATION ON MATTERS UNDER PROVINCIAL JURISDICTION

Hon. Alvin Hamilton (Qu'Appelle):: Lack of Consultation with Provinces through the rural areas of both western and eastern Canada. During those two campaigns, in every speech I made I emphasized this one point, that Canada could not be strong if some parts of Canada were weak and if some parts or groups of Canada were being discriminated against. I asked the people of the rural areas to support the government of that day in our efforts to lift up those parts of Canada which had fallen behind, and to lift up those groups which had fallen behind or were being discriminated against.


An hon. Member:: Like you did in the mari-times.


Francis Alvin George Hamilton: No government ever did more for the maritimes than the government led by the right hon. gentleman who is now Leader of the Opposition (Mr. Diefenbaker). Just as an illustration of this in other fields than that about which I have been talking, the Saskatoon Star-Phoenix for October 29 refers to a matter raised today by the hon. member for Kootenay West, namely water resources. This, Mr. Speaker, is the judgment of a Liberal paper:
What appears to be lacking in all these considerations is a co-ordinated federal-provincial-municipal drive toward a comprehensive Canadian water resources policy and program. Leadership, we think, must come from the federal authorities in water conservation and development.
This is federalism. It is not domination of the provinces; it is working together for the mutual advantage of all Canada. Yet the President of the Privy Council says that this co-operation we have achieved in the past will be wiped out. This is the policy of the government. It is no wonder there is a hornet's nest buzzing around the ears of the Prime Minister today. The question in the minds of the Canadian people is, will he be strong enough to take a stand for something? One day it is this way, the next day another way, and another day another way. As the farmers say, every day the wind blows the weed bends.
During our period of office we tried to give some leadership. It is true that that leadership had to be quiet, careful and responsible. It is true that that leadership had to be moderate and restrained. It is true that that leadership had to be with complete frankness and friendliness. That is why when you look back over those five and a half years, with one or two exceptions there was relative peace between the governments at the provincial level and the federal government, because certain things were being done.


John Whitney Pickersgill: Term 29.


Francis Alvin George Hamilton: We all heard and recognize the empty laugh of the hon. member for

Bonavista-Twillingate. If he ever writes another book I hope he will then tell us the whole Story.


Lester Bowles Pearson: Are you going to read from a book?


Francis Alvin George Hamilton: I am going to quote from the dominion-provincial conference proceedings of 1957, as published by the queen's printer. For a start I will quote the words of the then prime minister on the evolution of a new concept in federalism.


John Whitney Pickersgill: Mr. Speaker, as the hon. gentleman has brought my name into it I wonder if he would permit me to ask him a question. Would he quote what Mr. Frost, the then premier of Ontario, had to say at that conference about the attitude of Mr. St. Laurent on federal-provincial relations?


Francis Alvin George Hamilton: The hon. member for Bonavista-Twillingate, now Secretary of State, always likes to get up and run a rabbit across the trail. When I am hunting for moose I do not shoot rabbits.


John Whitney Pickersgill: He used to be a white rabbit.


Francis Alvin George Hamilton: If you recall, Mr. Speaker, in 1957 the previous administration, under Right Hon. Louis St. Laurent, had made agreements with the ten provinces respecting the fiscal relations which would exist for a five year period. The contracts were signed and these agreements were to be in existence for five years. A new government took office, a new government which had been expressing in opposition its concern over this constant tendency toward centralization of power in the federal government. This federal centralization was very noticeable in dominion-provincial relations, so it was only natural that there should be a statement of policy by the new government the minute this conference was called.
Let me emphasize again, Mr. Speaker, that there was no obligation on the new government of 1957 to call this conference. There were contracts in effect for five years which would have meant that we could have carried on without those tremendous increases in payments by the federal treasury to the provinces, which would have wiped out all the deficits we had during those five years. But in spite of the fact that there was an agreement with every province in Canada the new government called the provinces in, and in the opening paragraph of the report of the proceedings I have here appear the words of the then prime minister, Mr. Diefenbaker, the present Leader of the Opposition:
There have been times in the past when we have criticized the extent of federal participation in various common efforts on the part of the dominion and the provinces as inadequate. We have giver our undertaking that when new fiscal arrangements

are determined on, no province will receive less than it is now entitled to. But I want to make this clear at the beginning. We are not placing before you any "take it or leave it" attitudes; we are not taking any hard or fast positions. We are not placing before you any rigid formulae. This conference was convened to seek your ideas and your proposals. Clearly we cannot expect to solve all our major problems in two days, but we can hope in that time to have a general survey of many of them.
I quote that statement, Mr. Speaker, to demonstrate that from the very beginning of the Diefenbaker government there was an attitude that something had to be done about this relationship between the provinces and the federal government. Traditionally in Canada, like all federal states, there is a constant tug of war going on between the power of the provincial governments and that of the federal government. As conditions change the tendency is to swing one way and then another. Usually this tendency shows up in the federal house by the party in power tending to increase the position of the federal government and the party in opposition taking the opposite position to that taken by the party in power. This is normal and natural in the working out of democratic processes. For most of the early years of this period the federal government was represented by Conservatives. Naturally enough there was a strong movement to give power to the federal government as part of the effort to build up the country. The opposition to this growing strength came from a number of directions. The Liberal party defended the position of the provinces and became known in many areas as the provincial rights party. However, when the great emergency of the Hitler war arose the federal government gathered to itself tremendous powers, and used those powers in ways which were not always in keeping with tradition.
After the war was over this centralizing tendency continued and it was only natural that the opposition in those days should begin to express concern about this concentration of power in the hands of the federal government. It was understandable that when the Diefenbaker government took power we should have gone to the provinces, as the then Prime Minister did, and said to them "Let us have your ideas. They will be given consideration and then, after discussion, we shall arrive at a new fiscal arrangement".
Without going into detail about that arrangement, suffice it to say that the provinces were in fact granted a new deal. It cost the federal treasury a great deal of money. I might also say that in those discussions some of the provinces put forward demands which could only be described as extreme. Following the submissions and the discussions which
Lack of Consultation with Provinces took place some decision had to be made and, rightly or wrongly, it had to be made by the federal government at that time. However the offer of discussion was a step forward in this new concept which was evolving.
The next step had to do with my own department, the Department of Northern Affairs and National Resources. It was the wish of the federal government to link the great resources of the north with the several areas of Canada to the south. We proposed to proceed with this undertaking, and we therefore suggested to the provinces a cooperative program of roads to resources. Roads are, of course, the prerogative of the provinces. Still, there is no use building a network of roads in the territories unless they are linked with the settled areas of the provinces.
The negotiations which took place in this connection lasted 14 months or more, because not a single agreement was signed with one province until every province had agreed to every clause and every comma. The type of discussion which went on was bilateral in character; we went through the long and arduous process of getting agreement in every province for agreement in every other province. Very soon we recognized that no government could carry out its propositions in such a way. No government could spend so much time on a single type of contract. The next step was to speed up the process.
The government decided to call a conservation conference. A decision to this effect was announced in Winnipeg on February 12, 1958, by the then prime minister. It was announced again in the house on August 30, 1958. In getting the plans ready it was clear once again that these renewable resources belonged, in most cases, to the provinces and were administered by the provinces. The federal government had joint responsibility in connection with fisheries and agriculture. So we had this situation; 10 provincial governments had the ownership and management of their own resources, while the federal government was responsible for ownership and management of the resources in the Northwest Territories, the Yukon, and the continental shelf off our shores.
In planning this conference the federal government took the lead in calling the ministers of all the provinces together. It said in effect "These resources are under your jurisdiction, but they will not amount to a great deal until we plan together for their best use; and their best use depends on trade policies, on monetary policies, on fiscal policies and, yes, even on taxation policies." We put this thesis before the 10 governments.

Lack of Consultation with Provinces They were governments of various political complexions. Two of them were Social Credit governments. One was a C.C.F. government. There were several Conservative governments. I have forgotten how many Liberal governments there were. But they all agreed as Canadians to work together for the better use of our resources. In this way there was cooperation in planning from beginning to end.
At the conclusion of that conference one of the recommendations was that the technique developed in the planning of those meetings should continue afterward in the management of our resources. So today we have for the first time in Canada's history a Canadian council of resource ministers. This council, representing 11 governments, is served by a secretariat which is bilingual, which does not owe loyalty to a province and which does not owe loyalty to the federal government; its loyalty is to the concept of the best possible development of our resources in Canada. This is the council which is receiving such favourable comments from newspapers across Canada. Let me read from the background paper put out by the Canadian council of resource ministers:
The Canadian council of resource ministers represents a new co-operative approach by the eleven senior governments of Canada to the many and varied problems in the field of resource development.
The council was founded on the basis of co-equal participation of the eleven senior governments and a rotating chairmanship. This operating formula has provided for the first time in Canadian history an intergovernmental forum within which resource policies are examined and co-ordinated.
It goes on to describe the organization of the council, pointing out that the present chairman is Hon. Rene Levesque from Quebec. Then it continues:
The Canadian council of resource ministers was established following the resources for tomorrow conference which took place in Montreal in October, 1961. The conference originated in an announcement by former prime minister John Diefenbaker on February 12, 1958, that a national conference on conservation would be called.
These are not my words; these are the words of the Canadian council of resource ministers.
The provincial premiers were invited to participate in preliminary discussions of the planning for such a conference. All provinces responded favourably, and the first meeting of the national steering committee, consisting of ministers from all provinces and the federal government was held November 17, 1958.
That is how far back precedent exists for this type of co-operation.
The conference reached a number of important conclusions. It found that lack of co-ordination between governments and between departments within governments had created a serious gap in resource development and management.
At the same time the conference recognized the existing system of Canadian federalism, in which

the ownership of natural resources largely rests with the provinces, while fiscal, monetary and trade policies are the responsibility of the federal government.
The senior governments subsequently agreed to the formation of a council. The council's formation was announced on February 6, 1962 following the final meeting of the resources for tomorrow steering committee.
At the same time an advisory committee was established to prepare for the first full meeting of the council in Toronto September 20-21, 1962.
I put those passages on record because they tell a story of accomplishment. They tell a story of what can be done when there is leadership, and patience in that leadership. They tell a story of how men of different political persuasions can sit down and work together as Canadians to achieve an end which will be of benefit for all Canadians. There was no hornet's nest stirring around the leadership of the government in those days in connection with resource development because we followed a type of co-operative federalism which took the tension out of the usual tug of war between the provinces and the federal government.


John Whitney Pickersgill: Page Mr. Bennett.


Francis Alvin George Hamilton: It has been suggested that I page Mr. Bennett. Let me tell the house that from 1944 to 1957 progress in discussions with the United States on the development of the Columbia river was almost exactly nil. There were 13 years of debating such silly subjects as only the record will show.
In 1957 and 1958 we laid the foundations for the treaty with the United States by two or three techniques. One of them was to set up a liaison committee between the federal government and the government of the province of British Columbia, with two ministers from each government on that committee. Every step that we took was agreed to by both cabinets, including the final draft of the treaty. Up until that time there was complete co-operation between the two governments.
I will not go into the reasons that caused the delay, but I will say that the present government know what the reasons are now that they are in power. All their talk in the house and throughout the country during the last two or three years that we were in power of how when they got into power they would solve the Columbia river problem just like that was nothing more than a fraud committed by a political party. Never question me about the Columbia river. If some of these people had put as much time and work on this matter as some others of us did they would know how hard we worked. When the record is placed before the committee which will consider this matter, many

members are going to get the surprise of their lives when they see the efforts made by the two governments, federal and provincial, to achieve co-operation and to make the project a success, because to go ahead with it would have been a matter of great pride to all Canadians.
I want to move on, Mr. Speaker. Sometimes the term "co-operative federalism" is not too well understood by provincial governments. Most of them refer to this approach as the ARDA approach because of the fact that the peculiar timing of events has made this phrase stick in their minds. If I may, I should like to go back in history a bit. In August, 1958 the then prime minister announced in the house a seven point national development program dealing primarily with agriculture. One of the points was a conservation policy, because the problems of agriculture could not be resolved purely within the realm of traditional agriculture alone.
It was our plan that the resources for tomorrow conference would be held in the fall of 1960. When the experts told the 11 governments that if it was held in the fall of 1960 they could not guarantee its success because their preparations were not complete I recall saying to the conference of ministers, as minister of agriculture at that time, that I would agree to the holding of the conference in 1961, a year later, to make sure it would not fail. However, I said that the needs of agriculture were such and our planning in the federal field in regard thereto had proceeded so far that we knew fairly well where we wanted to go, and as the federal minister I asked the steering committee to give me permission to go ahead and discuss with the provinces the subject of ARDA. We did not call it ARDA then; we just called it redevelopment.
They examined the situation. If you will go back and read the records of the House of Commons you will find that I gave my word that ARDA would in no way contravene the principles of the resources for tomorrow conference to be held that fall. The bill went through the house in the spring of 1961. Those provincial ministers accepted my word. We had established a condition of trust among us, and they accepted my word that ARDA would be co-ordinated with the efforts of the resource ministers council whose object was to bring together all departments of the federal and provincial governments in order to plan in the best interests of Canada. I honoured my commitments to the ministers on that council, and they honoured their word. They did not hinder me in any way in my efforts to get ARDA on the statute books before the resources for tomorrow conference was held.
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As a matter of fact I saw all the agriculture ministers, first of all in conference here and then individually. Many members in the house will know that I visited those ministers. When I met the agriculture ministers I explained to them that the federal government wanted to achieve certain ends. I pointed out the necessity of moving in a certain way in connection with low income farmers across Canada. I said that before the federal government brought forward this legislation I should like to consult with each of the provinces individually and some of the provinces as a group.
It was during the ARDA discussions that the provinces first experienced this type of co-operative federalism, in that the then minister of agriculture or his officials discussed with them the planning of a new type of legislation that we wanted to bring before the house in Ottawa. I went to the extent of making speeches across the country advocating these principles. When I had secured the agreement of all the provinces for the type of thing we wanted to do I went to my colleagues in the cabinet and said "You asked me to prepare this legislation. I have consulted the provinces, and the legislation is the result of the co-operative efforts of all 11 ministers. There will be agreement all across the country".
The ARDA legislation was introduced into the house with the backing of all the provincial ministers and farm organizations. Even the opposition then did not oppose it. In fact there was so little opposition to the bill that I was forced to debate it on third reading myself in order to point out that there were some weaknesses in it. That shows you the extent to which you can get the provinces, farm organizations, business interests and political parties to work together if we put the needs of the country first and foremost. So the provinces refer to this co-operative federalism as the ARDA approach, and I am grateful for it; because it shows the complete harmony we had in introducing this legislation and carrying it out.
There is one thing more I should like to say in connection with ARDA, which I have already said but which I should like to emphasize. I guaranteed as a federal minister that nothing would be done under ARDA to contravene the principles that would be established by the resources for tomorrow conference. I kept my word. No minister throughout Canada, whether he is a minister of agriculture or a resources minister, will deny that, because they know I kept my word in so far as agriculture was concerned. Even though agriculture is one of the oldest and most strongly entrenched departments of the

Lack of Consultation with Provinces federal government, we always took our problems to the co-ordinating committee and cleared them with that committee. That was our intention, and all I can say at this time is that I hope this practice is still being carried out; because if you want to destroy something fine, if you want to destroy something good for Canada, just destroy the type of co-operation that we achieved in working out the ARDA program, and the type of program we achieved in working out the Canadian council of resource ministers.
I take some pride in telling this story. I hope it will be told all across Canada. I think our actions created a new concept of co-operative federalism compared with the former situation. Where federalism used to be a tug of war we tried to establish a basis on which we could work co-operatively in those fields where there is joint jurisdiction, in those fields where the provinces wanted us to work with them or we wanted them to work with us.
But it was not only in the department I headed that this course was followed. Sitting beside me in the house today is the former minister of labour. I recall where the idea came from for the winter works incentive program. I recall the tremendous efforts he made as minister of labour to consult not only with all the provinces but right down to the municipal level before introducing this program. He always considered their wishes with regard to this matter as having priority.
Here you had in the Department of Labour under the Diefenbaker government the same type of approach by way of co-operative federalism that I have demonstrated was the case in the resource field, and particularly with regard to agriculture. Furthermore, when I went to the then minister of labour with the story of how there were great problems in education in the rural areas of Canada it was he who took the initiative in the field of education by calling the provincial ministers together with their staffs. We had a great backlog of uneducated Canadians with less than the normal opportunity to obtain an education. What kind of curriculum could you set up to give these many thousands of Canadians the opportunity they deserved? There was no resentment on the part of the ministers of education and their staffs. We simply put forward the need, and the governments of the provinces, representing every national political party, co-operated. But the leadership came from the minister at the federal level. He knew he had no rights with regard to education from the point of view of jurisdiction, but Canadians had a need so far as this particular aspect of education was concerned. Naturally I worked through the minister of labour. I tell you these things because this philosophy was pervading all departments.
[Mr. Hamilton.!
I also recall the efforts made by the former minister of national health and welfare in talking to the provinces and holding long consultations with them before he did anything. So far as hospitals are concerned he went right down to the hospital organizations and medical associations. There was always consultation ahead of time. His efforts were always directed to trying to achieve the maximum support for various ideas that would help the whole of Canada. Yet surely health is the prerogative of the provincial governments.
This concept of federal-provincial co-operation extends into many fields. My young colleague the hon. member for Brome-Missis-quoi, has tried so hard in the house to put forward the idea the Montreal Gazette put forward, after he proposed it, that there should be a secretariat to deal with dominion-provincial fiscal relationships. We all know what happened to that particular biff. It was slid out of here pretty fast on the ground that it was contrary to the rules. Now he has brought back a resolution and this young man, believing in this country, puts forward these ideas to extend the concept we evolved, and which we proved by experience will work in this very difficult and delicate situation now existing between the provinces.
How many hon. members on the government side, even though they go outside the house and grumble, will stand up in their places and grumble out loud on behalf of this young man who speaks for Canada? This is the place for a federal co-operative system, and this is the place for accepting the lessons we have learned over the last five or six years.
The other day I took the liberty of speaking on the forestry estimates, and one of the proposals I put forward to the Minister of Forestry was that he should examine into the principles of ARDA, that he should examine into the principles of the Canadian council of resource ministers, and realize the opportunities that exist in his department to put this same type of co-operation into effect. The forest industry is the most important one we have in Canada. Once again the forests are owned and managed by the provinces, but the federal government has to give leadership because it has a tremendous influence on forestry through trade, fiscal and monetary policies, and through taxation.
If we sit back and say we are going to get out of this field and let the provinces go it alone, we will go back to the type of situation they had in the United States before 1787; 13 separate, sovereign states with a little government up on top that had no power and was useless. Canada is our country. We were second in the world in pioneering

the federal concept. We think that in this new dimension we have added to federalism we have added a dimension that equals the original concept of confederation as pronounced at the 1787 convention of Philadelphia. We have given a type of example which will be extremely useful to the 20 federal nations in the world today.
When representatives of new countries like Malaysia come to Canada, do not tell them about these fights between Mr. Lesage and the Prime Minister of Canada. Do not tell them about the lack of leadership at the centre. Tell them about the positive things that will help them; and the positive things that will help them are the things that will work. We believe that you evolve new concepts, and only after you evolve them and prove that they work do you work out a theory to explain them. I suggest to these new countries that we in Canada have set a precedent. I do not want to cover the whole field but I would like to mention-


Mr. Macdonald:: Complete a few more points of your biography.


Francis Alvin George Hamilton: The hon. member who has just interrupted reminds me of a type of wheat we used to grow in Saskatchewan.


Donald Stovel Macdonald: It is all sold.


Francis Alvin George Hamilton: It was long in the straw, big in the head, but when you threshed it there wasn't much in it.


Mr. Monleith:: That is Rosedale.


Donald Stovel Macdonald: So they sent you down east then.


Francis Alvin George Hamilton: Before the election the premier of Newfoundland published a book on the necessity of doing something for the fisheries on the Atlantic coast. If you read that book carefully, and I recommend it to all hon. members of the house, you will see Mr. Smallwood raised a cry for help on behalf of the fishermen on the east coast. What did he say in that cry? He said the answer is in the ARDA approach, and is in the way they do it out west. The book is a eulogy of the five and a half years of the previous government led by Right Hon. John Diefenbaker.
Do you think the premier of Newfoundland is going to sit idly by and see that five, six or seven Liberals are elected from Newfoundland to the federal house if they do not follow the example of co-operative federalism which we set? You are all going to find out who runs Newfoundland if you do not get into line fairly fast and realize that if you want to hold Joey Smallwood, you had better start thinking of co-operative federalism and doing something about the fishery 28902-5-295J
Lack of Consultation with Provinces industry; and not on the basis of handouts. That whole book describes what I have just described, and I would particularly recommend it to the Secretary of State. I am sure he did not write that one.
Now I wish to say a word about what this government has been doing. I know that members of the government, when they sat on the opposition side, had complete confidence that if only they could get back on the treasury side all would be well. I recall one of the members of the opposition at that time saying he had all the answers; he had written a book, and all the answers were there. One of the oddest things was that about the only people who read his book were Liberal politicians-


Lester Bowles Pearson: You must have read it.


Francis Alvin George Hamilton: -and the ones who read it began to mouth the things that appeared in it. They did not realize that what they were espousing was a philosophy that was turned back in history 400 years ago. This book took our economic theories back to the days of mercantilism, to the days of restrictions; and when members of the present government took office they naturally carried out the instructions in the book.
The 30 per cent transfer tax was the first item and all these poor dupes, this cannon fodder, got up and said they had confidence in the government. Then the Liberal press jumped on the poor Minister of Finance and said he was to blame. That is wrong. It was all in the book.


Donald Stovel Macdonald: Now tell us about the renegade.


Francis Alvin George Hamilton: It was all in the book and these people accepted it. They got elected on it, and when the Minister of Finance began to carry this out they got their back door boys working and said "Get rid of Gordon." Why were they trying to crucify one of their number when they knew the real culprit sat in the Prime Minister's office?
The Prime Minister went down to Hyannis Port and surely, Mr. Speaker, if you are going to do anything as serious as this you will consult with the other party. What did happen at Hyannis Port? There was the 30 per cent transfer tax, to be followed by a 15 per cent transfer tax on their side. I can just see it happen. Canada gets the blame for the 30 per cent transfer tax and Canada suffers for the United States 15 per cent tax at the same time.
The confidence of the Liberals was all right 15 years ago when they had a man who could lead them, and that man was Howe. Sure, he did not care about parliament; he did not

Lack of Consultation with Provinces care about the democratic procedures, but he did have the brains to put forward proposals.


An hon. Member:: Hear, hear.


Francis Alvin George Hamilton: I hear them say "Hear, hear" over there. I agree. Rubber stamps are still with us. The government stands condemned for having the same arrogance, but no leadership. This is my charge. Look at the record. The municipal loan and development fund means interference with provincial rights, and the provinces tore into that. Then the government went crawling to Quebec city and came back with their tails between their legs, with complete surrender on their part. The Liberals, Mr. Speaker, call this leadership. "Peace at any price Pearson"; this is how the Liberal leader is known across Canada.
They retreated on this municipal loan and development fund. What do I say? I say it was wrong for them to interfere in the provincial field, and it was equally wrong for them to retreat. There is supposed to be cooperation. There is a need for the federal government in this type of assistance to municipalities, but it should not be accomplished by arrogance or by interfering with the provinces. Surely there should have been some consultation ahead of time. Surely men of good faith from the ten provinces and the federal government could have evolved a scheme that would have been acceptable. Now we have four provinces going one way and six going another. As we say in an area far from here, this government does not know whether it has been punched, bored, countersunk, or reamed out with a steam shovel.
Well, it is all in the book. They enunciated a Canada pension plan. Surely this was an invasion of provincial rights. Surely the Liberals must have been aware of the fact that when the Conservative government was in power it was proceeding slowly and carefully toward some sort of pension plan in co-operation with the provinces, respecting their constitutional rights, respecting the rights of individual groups who had plans of their own. We were working steadily toward this objective. The Liberals were not prepared to use the co-operative approach; they were not prepared to use the evolutionary approach. They had to move in a la Howe, but without his brains. So the Canada pension plan has been smacked by Quebec, demurred at by Ontario and the other provinces, and has been put under the rug in the hope that something will come from it. The only way something will come from it is to go back to the principle we established of consultation with the provinces and with other groups. This is the approach of co-operative federalism.

Once again I have noticed this Liberal technique. The minister who was responsible for this gaff is being crucified. I refer to the Minister of National Health and Welfare (Miss LaMarsh).


An hon. Member:: By you.


Francis Alvin George Hamilton: The ex-party whip says by me. All he has to do is read the Liberal newspapers and he will ascertain what they suggest should be done with Judy. Once again we see this Liberal technique of destroying one person when the real blame falls upon the Prime Minister. Just let the Prime Minister go back to that day in the middle of September when his minister of health was saying there was no intention of bringing up a certain subject at the meeting with the premiers. Then the Prime Minister stated they were going to make the decision that there was to be an increase of $10 in the old age pension. You can imagine how the minister felt. This is another illustration of how they jumped in with the Canada pension plan and then had to retreat.
There is one other problem I should like to mention, and that relates to the Department of Industry. This Department of Industry was established because we needed some extra incentives. Some of the work of the Department of Industry was being done by the Department of Trade and Commerce, but more emphasis was necessary. Once again there was no consultation with the provinces. In fact when the letter comes forward from the premier of Manitoba and appears in public you are going to find this Department of Industry condemned in very clear terms, not only as a direct infringement of the rights of Manitoba but of other provinces-


Mr. Byrne:: I rise on a point of order, Mr. Speaker. I think the hon. member is sufficiently well acquainted with the rules to realize that he cannot reflect upon past proceedings of the house, nor can he refer to another debate in the same session. These prohibitions are contained in standing order 35 and set out in citation 149 of Beauchesne's fourth edition. The citation reads:
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:
Then there are the rules to which I referred. Since the outset of his remarks the hon. member has been breaching these rules, and I thought it would be only fair to bring this fact to the attention of the house.


Francis Alvin George Hamilton: I have listened with some amusement to the objection made by the hon. member for Kootenay East. I do not blame him for not liking this catalogue of the government's failures-


James Allen (Jim) Byrne: I did not object; I have raised a point of order.


Jay Waldo Monteith: Sit down and make your speech later.


James Allen (Jim) Byrne: I ask for a ruling on this matter, Mr. Speaker.


Mr. Speaker:: A ruling will not be long in coming. In a supply debate it is well understood that great leeway is given, and it is partly a matter of good taste on the part of the hon. member speaking. It seems to me that the hon. member is entitled to refer to some of these things in order to make his points.


Lester Bowles Pearson: I wonder if I could ask the hon. gentleman a question. He has just referred to a letter which presumably has not been made public from the premier of Manitoba dealing with the establishment of a Department of Industry. May I ask him if he is going to put that letter on the record and, if not, whether he has seen the letter?


John George Diefenbaker: Wasn't that a profound question?


Francis Alvin George Hamilton: I think it is obvious, Mr. Speaker, that I have seen the letter or I would not be paraphrasing it. There is a motion of mine, which has been accepted by the government, for the production of that letter. The motion was made, I think, two weeks ago, and the letter has not been presented as yet. I know the premier of Manitoba is quite willing to have the letter produced, and I thought under the circumstances it would be quite all right if I referred briefly to its contents.


John Whitney Pickersgill: I wonder if I could ask the hon. gentleman a question. Is the hon. gentleman telling us that the premier of Manitoba showed him a letter, as a member of the opposition, which was addressed to the government of Canada and has not yet been made public? Does he approve of that kind of conduct in federal-provincial relations?


Stanley Howard Knowles: Page the Minister of Transport and the hon. member for Winnipeg South.


Francis Alvin George Hamilton: Mr. Speaker, of all people to raise that objection, the hon. member for Bonavista-Twillingate-


John Whitney Pickersgill: It was not an objection, it was a question.


Francis Alvin George Hamilton: -should be the last to raise it. When he was in the opposition he read things to us, as the government, before we even got them.


John Whitney Pickersgill: I must rise on a question of privilege, Mr. Speaker. I challenge the hon.
Lack of Consultation with Provinces gentleman, who has a very faulty memory, to produce one tittle of evidence that I ever quoted in this house any document from the premier of Newfoundland that had not been made public. I challenge him to find a single bit of evidence, and not just give his obviously blurred recollections.


Francis Alvin George Hamilton: I was hoping to finish my remarks by one o'clock, but I do want to emphasize this one point. I do not believe I mentioned Newfoundland. It was the hon. member himself who mentioned Newfoundland. I do not know whether there is any guilt there, but I should think the challenge would be an interesting one to look up. However, I am not going to do so now.
I know the members of the government have been listening very intently to my speech because this withdrawal from the municipal loan and development fund, this retreat on the Canada pension plan, and the Department of Industry, all these fluffs that have been made by the present Prime Minister indicate a lack of leadership. In so far as the Department of Industry is concerned, you will find it will not be only the province of Manitoba that will be objecting, but other provinces are going to suggest that you use the approach we used. Do not belittle this approach because we brought it into being, but use it and accept it. Earlier I mentioned the withdrawal from joint programs referred to by the President of the Privy Council. I wonder if there was a discussion with the provinces before that announcement was made. I wonder if their feelings were considered, or was it just a unilateral statement by a member of the cabinet, backed up by the Prime Minister, and now these long established programs are going to go?
I do not know what the people of Canada believe about these things like hospitalization, the various grants to those between 65 and 70 years of age, to the handicapped, and so on. I could mention also the roads to resources program. We have been making money available for the development of vocational schools to help with unemployment. Surely, Mr. Speaker, the federal government has a place in this structure. Surely we do not have to go back into a little hole when these provinces make these extreme demands. We expect some strength of will on the part of the government, and that means the Prime Minister. We want to work co-operatively with all three levels of government.
We heard a speech the other day by the hon. member for Three Rivers (Mr. Balcer). This was a great cry coming from 85 per cent of the people of Quebec. We are not sent here, as he said, to bisect the country. I charge the government with pursuing policies which will
4624	HOUSE OF COMMONS
Lack of Consultation with Provinces not only bisect the country but dissect it. This government stands condemned by its actions, its retreats, its statements. The government is not even trying to make an effort to get out of this impasse. This country is worth too much to let it go by default. We can sit down with any group in this country and discuss their problems, and I will gamble my whole life on the faith that Canadians will always find a solution.
I think that solution has to be co-operative and evolutionary, and must provide several criteria which have to be accepted by all Canadians. One is that there is a place for the federal government. We must maintain a strong federal government. At the same time we must do what we can to strengthen the provincial governments within their spheres of jurisdiction. There are going to be many cases of overlapping jurisdiction. There are going to be many cases where the provinces will want the federal government to work with them, because we do have so much effect on their policies through our trade policies, our monetary and fiscal policies, and so on. I suggest there is an answer. But to get up and say they are going to get out of all these provincial co-operative schemes and withdraw from the joint programs is a negation of the federalism I know and intend to struggle for.


An hon. Member:: We never said that.


Francis Alvin George Hamilton: How much plainer could it be put than that they are going to withdraw?


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


Francis Alvin George Hamilton: Very well; I will carry on later.


Stanley Howard Knowles: I realize the hon. member can carry on afterwards, as is his right, but in view of the importance of this subject would he do the house the favour of letting it know before one o'clock what amendment he proposes to move?


John Whitney Pickersgill: Let him read it so we may know what it is; he need not put it.


Francis Alvin George Hamilton: I thought I could finish in the next minute or two, but I realize it is impossible. I was going to wind up with a catalogue of sins of the government and then move this motion:
That all the words alter "that" be struck out and the following substituted therefor:
"that this house condemns the government for its failure to carry out the spirit of co-operative federalism and for its neglect to consult with the provinces before announcing or undertaking programs which fall wholly or partly within provincial jurisdiction.
May I call it one o'clock, Mr. Speaker?
At one o'clock the house took recess.
[Mr. Hamilton.!


[Stage Direction]
AFTER RECESS

The house resumed at 2.30 p.m.
Francis Alvin George Hamilton: When the house took recess I was on the point of moving an amendment to the motion that you leave the chair, Mr. Speaker. I read the amendment into the record so that all parties would have an idea what it was. I should like to sum up what I was saying this morning by listing the indictment I tried to make.
We condemn the leadership of the present government on the grounds of its behaviour and action in connection with the municipal loan and development fund. We condemn it for its failure to act with regard to the Canada pension plan. We condemn it for its attitude in connection with the Department of Industry, not only because of its decision to designate areas without consulting the municipalities concerned but also because of the serious overlapping which occurs with the powers and activities of municipalities.
We condemn the present government and its leadership for the method used in announcing its withdrawal from the joint programs. We know this intention was originally announced in the course of a speech at a nominating convention in Quebec city two elections ago when the President of the Privy Council was nominated. That speech was made by the present Prime Minister, who was then leader of the opposition. We have since heard the President of the Privy Council repeat this speech at a meeting in Toronto and go into great detail with regard to the proposal. This has caused serious disturbance in the minds of members of provincial governments across this country. Possibly it is because the President of the Privy Council has a reputation in Quebec as a centralist that he was forced to make the statement he did in order, if possible, to prove he was not a centralist. However, by making this speech he has encouraged even more extreme statements to be made by people who would ordinarily have awaited developments before reaching conclusions.
The way this statement was made is another example of confusion and bumbling by the present government in making announcements which seriously affect agreements between the federal government and the provinces. Tremendous confusion has been caused by this approach. I could mention many examples, but I should like to remind the house of what was said in connection with university scholarships. Just after the present Minister of Northern Affairs and National Resources took office he went out to the west coast and announced that a far reaching scheme would be set up immediately. This aroused great expectations. As

far as we can gather the provinces were never consulted about this scheme. Well, an announcement was made and nothing happened. I am simply saying it looks as though there is another retreat in this area, too. The minister says something is going to be done, but there is no action. Therefore we must assume the government has retreated. Once again they have gone into a provincial sphere and talked about what they were going to do. There is no evidence that any province was consulted, and now we find no evidence of action.
I notice that the Minister of Agriculture is not here, but I wonder if he has ever called together the eastern advisory committee of the Canadian wheat board. There is a serious problem facing the eastern part of Canada, the maritime provinces, in connection with grain. We have here a board representative of the provinces concerned which when occasion demands, meets with the government agency, the Canadian wheat board, to help resolve difficulties of this kind. There is no evidence that the present government is making any use of the consultation machinery which was provided by the previous government as a means of supplying answers to these problems.
But the most damning indictment of all, especially in the mind of the public, is based on the course of events with regard to the Canada pension plan. Here we had a plain statement of the government's intention, the central plank of the election campaign. Yet because of a waspish and witch-like attack on the premier of a province, the whole matter has become embroiled in side issues. The government has had to retreat and, once again, the general wishes of the provinces are not consulted.
However, there are some signs that certain members of the government are aware of the need for co-operation. For example, the Minister of Forestry, in the statement he made on his estimates, did indicate his awareness that he could get good ideas from the provinces and that more rapid progress could be achieved in this field by working in co-operation with the provinces.
On the other hand the Minister of Fisheries does not seem so convinced. I have been watching for some sign of leadership from the central government so the great knowledge and experience which has been built up federally can be used to do something of benefit for the fishing industry in cooperation with the premiers of Newfoundland, Nova Scotia, Prince Edward Island, New Brunswick and Quebec as part of a joint program. A great need exists, yet there is little evidence of such leadership coming forward. The only leadership of which I
Lack of Consultation with Provinces have any evidence seems to be coming from the provinces themselves. So for every sign that something is being done there are ten signs to the contrary.


Mr. Robichaud:: Would the hon. member permit a question? He has referred to a joint national program for fisheries. Is he aware that a federal-provincial conference on fisheries has been called for the week beginning January 20?


Francis Alvin George Hamilton: That is the point I am trying to make. The government has called this conference. There is to be a consultation of ministers, but there has been no preliminary work, no preliminary consultation.


An hon. Member:: Ridiculous.


Francis Alvin George Hamilton: That is what they say now, is ridiculous. That shows the difference of attitude. When I see evidence that the proposal put forward by the premier of Newfoundland is acted on, not as a bilateral deal between the federal government and the provinces but as a joint agreement between the federal government and the five eastern premiers, I will know that some effort of a co-operative kind is being made; something which meets the situation, not this pick-peck type of approach.


John Whitney Pickersgill: Four months behind.


Francis Alvin George Hamilton: I see that the Secretary of State is agitated. I want to make it very clear that the accusations I make against the government do not include the Secretary of State. Even if others have failed to consult and discuss and do the preliminary work necessary to avoid these confrontations that have shaken and rocked us, the Secretary of State is a different type. Everyone knows he has been around and knows about his consulting with the C.B.C. and B.B.G. all the time. He is a great man for consultation, and he does not come under the indictment.


John Whitney Pickersgill: Is the C.B.C. a province?


Mr. Graffley:: It is the minister's province.


Francis Alvin George Hamilton: I am sure the Secretary of State caught the full implication of what I said. Finally, Mr. Speaker, in exemplification of my remarks I want to say that in view of the encouragement that has been given by the President of the Privy Council to ministers of the province of Quebec, like Hon. Mr. Laporte, to come forward and make statements such as were made over the week end; and in view of the counter-statement made by Premier Bennett, which was quite extreme and obdurate, I say that the conference called for November 25 and 26 is doomed to disaster.


Lester Bowles Pearson: Gloom and doom.
4626	HOUSE OF COMMONS
Lack of Consultation with Provinces


Francis Alvin George Hamilton: This conference-


Lester Bowles Pearson: That is what you would like.


Francis Alvin George Hamilton: -is going to be a confrontation of premiers stirred up like hornets because the federal government has interfered with their jurisdiction and when challenged has backed away and has not fought for the federal position. This is a situation that can only be described as one of great weakness on the part of the leader of the government. Never has confederation been in greater danger, though not in any danger because of the fundamental feelings of the people. They are sound enough. The people want to stay together as Canadians. Nevertheless confederation is endangered because of the fumbling and bumbling of the present government.
The members of the government are not aware of the techniques of co-operative federalism which have been built up carefully and gradually evolved. They are using the technique of interference, but once they are caught interfering they run the other way without any regard to the maintenance of the rights of the federal state.
We have been trying to find out about their approach to the forthcoming conference. We have been trying to find out exactly what has been done. It is evident, however, that every proposal they are going to put forward has been hastily conceived. There is no evidence of consultation or of prior general agreement on principles at all. As I said, all we have is even more confusion and more bumbling. There is lack of leadership. We can at least say that during our five and a half years in office we had strong leadership. All that the Liberal members can say after the first seven months is that they have had weak and waffling leadership.


An hon. Member:: Too strong for his own cabinet.


Francis Alvin George Hamilton: I read today from an editorial in the Montreal Gazette dated November 6. I want to put forward with all the persuasion I can that there is some hope, that there is no need for the government to run off into a corner and give away its position all the time. There is a place for the federal government and for the provinces, and the federal government should not run away from their position all the time and lead us toward some form of confederacy which as a political form disappeared many years ago,
Let me read the last paragraph of the editorial again. The editorial is headed "The hope in 'Co-Operative Federalism' ". Here is the editor of a great newspaper saying that

there is some daylight in the gloom. The last paragraph reads as follows:
This type of development could give Canadian federalism new life, new hope, new fellowship, and new effectiveness. It will open up the prospect of a future of co-operation instead of conflict. The possibilities for developing this co-operative federalism are as numerous as the denial of such co-operation will be ominous.


An hon. Member:: Hallelujah.


Francis Alvin George Hamilton: The hon. member says "hallelujah". I say "amen". At this time I move, seconded by the hon. member for Three Rivers:
That all the words after "that" be struck out and the following substituted therefor:
"That this house condemns the government for its failure to carry out the spirit of co-operative federalism and for its neglect to consult with the provinces before announcing or undertaking programs which fall wholly or partly within provincial jurisdiction".


John Whitney Pickersgill: Before the hon. gentleman takes his seat I wonder whether he would permit me to ask him one question. Was the hon. gentleman, when he talked about me conferring with the C.B.C., accusing me of conferring with the C.B.C. about his notable appearance on C.B.C. television in regard to Peter Newman's book?


Francis Alvin George Hamilton: Mr. Speaker, the seriousness of that question is typical of the hon. member. All I should like to say is that the fact he has asked the question indicates a guilt that I think we can all see.


John Whitney Pickersgill: It was not the "gilt", it was the gingerbread.


Thomas Clement (Tommy) Douglas: Mr. Speaker, the hon. member for Qu'Appelle, on behalf of the official opposition, has moved a no confidence motion condemning the government for its failure to carry out the spirit of co-operative federalism and for neglecting to consult with the provinces before announcing or undertaking programs which fall wholly or partly within provincial jurisdiction.
I was extremely interested in the speech made by the hon. member for Qu'Appelle, and I want to congratulate him on some of the points he raised. However, it was not clear to me at some points in his speech whether he was moving a motion of no confidence in the present government or asking for a vote of confidence in the previous administration. As a matter of fact there were long sections of the speech in which I thought there was being added to the Diefenbaker years an autobiography on the Hamilton years.


Stanley Howard Knowles: "Renegade out of power".


Thomas Clement (Tommy) Douglas: However, the hon. member has raised what is a crucial question for parliament and for the people of Canada, and I think he has performed a great service in raising this matter. Sir John A. Macdonald once said Canada was a difficult country to govern. Again and again throughout our history there have been times when it appeared that Canadian confederation was going to disintegrate, but always the good sense of the Canadian people has rallied and we have managed to resolve our difficulties and go on as a united people.
I am convinced that in this present critical situation the good sense of the Canadian people will once again assert itself. I believe we will meet the difficulties which now confront us, but it will only be done if we are prepared to look carefully at our problems, be as non-partisan as possible in seeking solutions, and endeavour to get a spirit of unity in working out the problems of confederation.
One of the difficulties is that we are confusing two questions. We are confusing the matter of biculturalism and the matter of federal-provincial fiscal relations. I think we have to separate them in our thinking. We must first of all accept the spirit of co-operative federalism, and by that we in this party mean that the two founding races, the French speaking and English speaking races, came together in a pact which we call the British North America Act. That constitution guaranteed to the French speaking people of Canada certain basic rights; and there is a feeling in the province of Quebec today, which I personally think is justified in some respects, that English speaking Canada has not always lived up to the spirit of confederation. Whether we agree with that statement or not, the fact remains that even if people feel they have a grievance then there is a problem, and I think all Canadians have to stop and accept the fact that in French Canada today there is a sense of grievance. There is a feeling that they have not been allowed to play their full part within the spirit of Canadian confederation, and this is something which has to be faced up to honestly, patiently, and with understanding.
The present government recognized this when it set up the royal commission on bilingualism and biculturalism. I am sure all of us hope that as a result of the representations which are made to that body we will get a report that will chart a course for the future, that will bring the two races together in a spirit of harmony within the Canadian confederation.
Of course this situation is not helped by the extremists on the one hand who talk about taking Quebec out of confederation, who use the most violent terms associated with
Lack of Consultation with Provinces separatism; nor is it helped on the other hand by statements such as those contained in yesterday's Globe and Mail, reporting a speech made by the premier of British Columbia, which says:
B.C. will not even listen let alone agree to any basic changes in the British North America Act at the interprovincial conference in Ottawa this month, Premier W. A. C. Bennett said Saturday night-
Mr. Bennett indicated that Quebec cannot expect British Columbia to support its demands for a special place for the French language and culture in Canada.
"Federal civil servants should be appointed on merit and merit alone," he said. "We will not stand for civil servants getting more money for talking two languages, or three languages for that matter."
If anything is needed in Canada today it is for people, particularly leaders in positions of responsibility, to approach this problem with an open mind and an understanding heart.
But, Mr. Speaker, there are much deeper problems which should not be confused with the question of biculturalism, and they are problems that have beset confederation ever since 1867. A federal system is always difficult to administer, and the Canadian federal system has been no exception. The Rowell-Sirois commission was set up in the late 1930's because parliament and the government of that day recognized there were three problems facing the federal and provincial governments. The first was that since confederation the responsibilities which had been allocated to the provinces under the British North America Act have grown and expanded, without any increase in the sources of revenue with which the provinces might discharge these increased responsibilities.
In 1867 giving to the provinces responsibility for education, welfare, health and resource development did not involve large sums of money. In those days there were no such things as unemployment insurance, old age pensions or widows' pensions, and no one thought of health services as much more than elementary sanitary services. Consequently the provinces were not allocated fields of revenue that could meet expanded services in education, health, welfare and resource development.
With the passing of the years, with the growing pressure of public opinion for better education, better health services, expanded pensions and more adequate resource development, the provinces found they were not in a financial position to discharge the responsibilities allocated to them by the constitution. The people of Canada saw new programs surging ahead in other nations. They saw universal pensions, unemployment insurance and health services being introduced in Great Britain and the Scandinavian countries, and

Lack of Consultation with Provinces they demanded that something of this sort be done in Canada. The provinces since then have been finding it increasingly difficult to do these things on the very limited tax revenues which have been allocated to them.
The second problem which has been bedevilling confederation is that the federal government, viewing the whole national picture, has been increasingly aware of the fact that there has been a lack of uniformity in the minimum standards of education, health and welfare enjoyed by people in different parts of Canada. Now, it is not the concern of one province to worry about the standards of another province, but it is a responsibility of the federal government to recognize that a Canadian citizen has a right to the same minimum standards of education, health and welfare whether he lives in Prince Edward Island, in the province of Manitoba or the province of British Columbia. Therefore the whole question of equalization has been to the fore.
The third problem that has faced confederation is the lack of capital resources to develop the natural resources of the respective provinces. Some of the provinces have the capital, or nearly enough capital, to develop their resources, but many of the provinces in Canada cannot and will not be able to develop their resources unless there is some equalization of capital allocation.
What have we done about these three problems? The Rowell-Sirois commission made certain recommendations. Hon. members will remember that those recommendations were scuttled by the premiers of two provinces. During the war there were temporary tax rental agreements. After the war Right Hon. Mackenzie King called a federal-provincial conference on reconstruction with a view to returning to the problem that the Rowell-Sirois commission had examined and had sought to solve. Out of that conference we began to move toward a solution of the three problems which the Rowell-Sirois commission had put forth in such clear and succinct terms. We tried to meet the problem of the provinces having inadequate tax revenues with which to discharge their constitutional responsibilities by entering into tax rental agreements. Surely nobody in Canada ever wants to go back to the tax jungle that existed prior to the tax rental agreements coming into effect. This is one thing to which the parliaments of Canada and the provinces should adhere.
The other thing that has developed has been equalization grants to reduce the disparity in income as between various provinces in Canada. When I hear some individuals

making speeches about the fact that the province of Quebec could manage its own financial affairs if only the federal government would stay out of certain tax fields and leave these matters to them, I think those persons ought to remember that the province of Quebec receives a larger share of the equalization grants than any other province in Canada. If I remember correctly it is some $69 million a year. They are entitled to it; I am glad they get it, but it should be remembered that Quebec is one of the provinces whose average per capita income falls below the national average, and the province of Quebec has as much of an incentive as any other province in Canada to continue tax rental agreements and tax equalization.
The other way in which this problem of provincial revenue has been overcome has been by means of shared programs. I submit that these shared programs have been of great value, and I think many of them ought to be retained. Also we have had conditional grants under which the federal government has made certain moneys available to the provinces providing they spend them for certain purposes and in certain ways. I will have something to say about the question of conditional grants later on. We have sought to establish some equalization across Canada by means of giving the provinces a share of the taxes which can be used for education. I believe that one of the best ways we could help the provinces which are going to be under increasing pressure for better educational services is not for the federal government to get into the field of education, which will only arouse antagonism in certain parts of Canada, but rather to give to the provinces a larger portion of the shared tax fields in order that they can use this money to lift some of the school tax burden off their municipalities.
We have helped establish better social services by means of pensions, family allowances and shared programs. Hospital insurance has been another means of equalizing the burden of providing social services in Canada, and some assistance has been given to the provinces for resource development. So we have begun in Canada to find some solution to the problems that beset federal-provincial relations.
But while we want to do everything we can to enable the provinces to have sufficient financial resources of their own in order that they may discharge their responsibilities, and while we want to have a minimum of interference in provincial jurisdiction, I suggest to those who talk about provincial rights that they must give equal consideration to leaving the federal government the

power to discharge its responsibilities. It the federal government is weakened in its fiscal capacity to meet the problems of economic stagnation and unemployment, then we will be in a bad position in Canada. No provincial premier will say that he is responsible for unemployment in his province and is prepared to take the burden off the federal government. Every provincial premier, and rightly so, says unemployment is primarily a federal matter. But if the federal government is to assume responsibility for promoting economic growth and providing full employment, it must have the fiscal means at its disposal to put money into circulation in times of deflation and to contract the amount of money in circulation in times of inflation. It must be able to-


Mr. Graff  ley:@: It is monetary.


Thomas Clement (Tommy) Douglas: My hon. friend says it is monetary. It is more than monetary. Monetary policy has to do with issuing the money, but fiscal policy has to do with distributing it; that is, so it can raise taxes and take money out of circulation, and ease taxes to put more money into circulation when necessary by providing housing, and so on; so it can have a shelf of public works, federal and provincial, by which money can quickly be put into circulation to create employment.
In my opinion no prime minister in Canada has a mandate from the Canadian people to preside over the dissolution of confederation. My plea to the Prime Minister is that, while approaching this problem of federal-provincial relations and doing everything possible to help the provinces meet some of the problems which I have just outlined, he should not weaken Canada in its capacity to deal with the great major problems of economic growth and full employment in this country. I cannot do better than quote the words which Right Hon. Mackenzie King used when he was opening the federal-provincial conference on reconstruction in 1945. They are worth remembering. He said:
The lessons of war have taught us the vital importance of co-operation in an effort to reach a common goal. Without unity there is frustration. Now that we are coming face to face with the problems of the post-war years, the need for unity and co-operation is not less than it has been: from some points of view, it is greater. The enemies we shall have to overcome will be on our own Canadian soil. They will make their presence known in the guise of sickness, unemployment and want. It is to plan for a unified campaign in Canada against these enemies of progress and human wellbeing that we have come together at this time.
I suggest that these enemies of sickness, unemployment and want are still present in our society, and that the federal government must retain the fiscal powers necessary to cope with them. I suggest that we need power
Lack of Consultation with Provinces to deal effectively with the economic fluctuations. We need the power to forestall economic stagnation and unemployment. The federal government needs the necessary power to provide the equalization of services as between the various areas of Canada. When some provinces say "We can go it alone", it seems to me that this is a very narrow and parochial outlook.
It is true that a provincial government has to think primarily in terms of its own citizens, but we in this parliament and the government have to think in terms of all the people of Canada. Nothing would do more to wreck confederation than to balkanize Canada, to give up fiscal powers that would result in one part of Canada enjoying prosperity while the other parts of Canada lived on a level of income that bordered on degradation. Part of the responsibility of the federal government and the federal parliament is to see to it that there is a distribution of income among the various areas of Canada so that a Canadian citizen, whether he comes from the middle of Canada, the Pacific coast or the Atlantic coast, is guaranteed a certain minimum standard of living, and has the right to a job and to a decent measure of economic security.
The federal government must, in my opinion, retain sufficient revenue so it can provide capital investment for resource development, particularly in the underdeveloped areas of Canada. We hear a great deal these days about helping the underdeveloped areas of the world. There is no party, Mr. Speaker, more interested in that or more anxious for Canada to do its part in that regard than this party. But charity begins at home. We all recognize that in Canada there are provinces with vast resources which cannot be developed unless they get some assistance in terms of capital investment.
I agree that the federal government should proceed with preparations for the Canada pension plan. There has been some criticism that the provinces have not been consulted. I agree that they should be consulted. But I maintain also that the present government made a commitment to the Canadian people to provide a contributory, universal portable pension plan, and that the Canadian people took that commitment at face value. This government has a responsibility to put that plan on the statute books, after consultation with the provinces; and no province should be allowed to stop the Canadian government from doing what it promised the Canadian people it would do.
There has been some criticism of the fact that the government did not consult the

Lack of Consultation with Provinces provinces about the municipal loan and development fund. I think that was regrettable. However, after they did consult the provinces the provinces recommended certain changes which were accepted and put into effect. This plan is in operation. I think instead of criticizing the government for the municipal loan and development fund legislation, we might do well to remember that the provincial governments and the mayors and municipalities of this country, have been pleading with successive governments for 18 years to put that kind of legislation on the statute books. It was long overdue.
I would say the same thing is true with reference to the Canada development fund. The Canada development corporation is something which is badly needed to stimulate economic growth in the underdeveloped parts of Canada, particularly to supply the kind of capital that the provinces cannot possibly supply to promote economic growth in their areas and to provide jobs for their people. Again, I think where the provinces are involved there should be consultation, but that consultation does not give the federal government any excuse for failure to proceed as expeditiously as possible to put that plan into effect.


William Heward Grafftey: Would the hon. member permit one question?


Thomas Clement (Tommy) Douglas: Yes.


William Heward Grafftey: Having said what he has said, does the hon. member feel then that the Liberal government should have consulted the provinces before they made the promise on the universal pension plan, instead of before they introduced the legislation?


Thomas Clement (Tommy) Douglas: No, I do not feel they should have consulted the provinces before they made the promise. I think the responsibility of any federal party going before the Canadian people is to map out what is constitutionally possible, to decide what their program is, and then consult the people of Canada. Then the responsibility is not to get cold feet when they meet opposition, but to carry out the commitments they have made to the people of Canada.
The hon. member for Qu'Appelle has moved this motion of no confidence in the government because of its failure to carry out the spirit of co-operative federalism and for neglecting to consult with the provinces. I want to say, in the first place, that I doubt very much if the Conservative party can pat itself on the back to any extent for either its development of the spirit of co-operative federalism or for its consultation with the provinces. If we are in a mess today, then both the previous Conservative and Liberal governments contributed to it. When I was

listening to the exchange of religious pleasantries by the Secretary of State who said "Alleluia"-


John Whitney Pickersgill: I deny that, sir.


Thomas Clement (Tommy) Douglas: I exonerate the Secretary of State. One of the Liberal members said "Alleluia" and the hon. member for Qu'Appelle said "Amen". I was going to suggest that they both ought to come to the penitents bench when we are looking at the mess in which Canada is at the moment. I suggest, Mr. Speaker, that the time has come to stop blaming each other. I do not believe the people of Canada care very much whether it was the Conservatives or the Liberals who made things worse than they were. As a matter of fact I am not as pessimistic as some speakers. I am not as pessimistic as the hon. member for Qu'Appelle, who says that the federal-provincial conference later this month is likely to be a dismal failure. I think we have made some progress.
I attended the conference in 1945 called by Mr. Mackenzie King, the federal-provincial conference on reconstruction. We have come a long way in the 18 years that have intervened, and both Liberal and Conservative governments have contributed in some measure to the progress we have made. We have not made nearly enough progress. We are in a critical situation now, but it will not help to solve the problems if we spend time trying to allocate blame. What we have to do is recognize that this country faces a crisis in federal-provincial relations.
We have faced such crises before, and our forefathers met them successfully. I believe we can meet these crises which are now upon us, both that concerning biculturalism and that which has to do with fiscal relations as between the government of Canada and the respective provinces. But if we are to do that we will have to approach this problem not as citizens of a single province but as citizens of Canada. We will have to start with the assumption that Canada must continue as a great nation; that the government of that nation must have the necessary powers to act like the government of a great nation; that the provinces have problems, and that they must be helped to solve those problems. But it will not help the provinces to solve their problems if we denude the federal government of the fiscal authority it needs to lead this country along the road toward prosperity and economic well-being.
I am going to propose an amendment, Mr. Speaker, because I think it is hardly fitting to criticize the government, or to go further and condemn the government, for its failure to carry out the spirit of co-operative

federalism when this government has been less than seven months in office.


William Heward Grafftey: Look at the mess.


Thomas Clement (Tommy) Douglas: My hon. friend says look at the mess. I can assure him the mess was not all made during the last seven months. I think what we have to do instead is to urge the government to be more aggressive than it now is in tackling this problem; that we must say to the government "We expect you to implement more fully the spirit of co-operative federalism. We expect you to co-operate with the provinces. Above all, we expect you to give this country the kind of leadership it needs in the present world situation". Therefore I move, seconded by the hon. member for Port Arthur:
That the amendment be amended, (a) by deleting the words "condemns the government for its failure to carry out" and by substituting therefor the words "urges the government to carry out more fully"; (b) by deleting the words "for its neglect"; and (c) by deleting the words "wholly or partly" and by substituting the words "to any extent", so that the amendment as amended would then read;
"That this house urges the government to carry out more fully the spirit of co-operative federalism and to consult with the provinces before announcing or undertaking programs which fall to any extent within provincial jurisdiction".
In moving the amendment we are not saying we are satisfied with the way in which the government has conducted federal-provincial relations. The government has only been in office a short time, but we would urge them to be more vigorous and aggressive; and if they are we can assure them they will have the support of the great majority of Canada's citizens.
In conclusion, Mr. Speaker, I want to say that while the extremists on both sides are most vociferous, I believe the great majority of the Canadian people want to retain Canada as a nation; they want a government at Ottawa with the power which will enable the country to act like a nation and conduct itself like a nation. If we are to find the answer to the problems of federal-provincial relations we shall do so only if we come to them in a spirit of unity and also in a spirit of sympathy and understanding. Unless we are prepared to see that many of the grievances which have arisen need rectification, unless we are prepared to see each other's point of view, this crisis will grow worse. But if we are prepared to approach each problem in a spirit of sympathy and mutual understanding, then I am convinced that this parliament and this government, if it aggressively tackles the problem, can do much to establish in Canada a spirit of unity.


Robert Norman Thompson: Mr. Speaker, first of all I should like to express
Lack of Consultation with Provinces my gratitude to the hon. member for Qu'Ap-pelle for bringing up this topic which he has introduced this afternoon. I am convinced that it is one of the most urgent and vital problems with which we should be concerning ourselves in this house, because as the previous speaker has just mentioned certainly our nation stands at a critical time in its history.
There is a saying "Marry in haste, repent at leisure". In this regard I agree with the mover of the amendment in condemning certain programs to which the government has hastily become wedded. Such would include the municipal development and loan fund, some of the budget resolutions, the Canada pension plan, and there are others. However, in fairness to the government I believe I should say that it has shown quite an unusual capacity for repentance. It repented a little in regard to the budget; it reached a compromise with the provinces in relation to the municipal development and loan fund. Two weeks from now the subject of the Canada pension plan will be raised at a meeting of the federal government with the provincial premiers. I sincerely hope this will provide the opportunity for a little more repentance.
As leader of a minority party and as a member of the opposition in this house, my choice in these debates is at best that of the lesser of two evils. This not only applies to many of the arguments which have been brought up by the hon. member for Qu'Ap-pelle concerning his charge against the government; it also relates to the record that his own government set in the previous administration, and I think as it relates to this particular subject with which we are concerned this afternoon it certainly concerns the government that that party followed as well.
In the twenty fifth parliament the government appeared not to do very much at all, and because nothing was done to solve the problems we are thinking about, not many mistakes were made. In the present parliament, in many instances which could be mentioned, the government has rushed in where the angels of the previous government feared to tread. Some of the policies introduced were obviously ill advised. On the other hand, the government's surprising capacity for having second thoughts and taking a second look has saved us from any actual disaster.
We have heard a lot today about co-operative federalism. Accepting the premise that we do face a great number of problems in Canada which concern the provinces, as well as the federal government, which concern the
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Lack of Consultation with Provinces whole nation, as well as the question of Canada being a nation at all, I think that what we need at this moment is a little bit of co-operative parliamentarianism. I believe we could solve some of our difficulties more effectively if we showed more of this spirit than our record in the past several months has indicated us capable of doing. I say this particularly in light of the fact that for the second time in as many years we find ourselves in a situation in this house where the government does not command an absolute majority.
In these circumstances I certainly believe it would not be in the best interests of the country if the government were overthrown on the basis of the proposition which has been advanced this afternoon. For one thing, we would be denying the Prime Minister (Mr. Pearson) the chance of hearing directly from the provincial premiers what they feel the government should be doing in the field of federal-provincial relations. We would also be denying him a further chance to repent with regard to certain measures which, I believe, have been brought in too hastily without adequate consultation with the provinces.
We heard a good deal about co-operative federalism in the speech from the throne. I imagine this is a phrase which has been left without an owner since the days when the old co-operative commonwealth federation became the New Democratic party. I imagine that both the old line parties, seeing a policy of such shiny appearance and high sounding name lying around unclaimed, have hastily grasped it to add it to their bag of tricks. Like the expression biculturalism, it is one of those expressions which are easy enough to use but far less easy to define. Nevertheless, if what it means is an exchange of ideas between the provinces and the federal government before they are put into effect, I am all for it. Indeed, this is why, according to my understanding, the forthcoming provincial premiers conference has been called.
The former minister of agriculture called attention to an important matter when he spoke of the need for more co-operation at the government level especially with regard to the development of our natural resources. His comments apply particularly to the ARDA program to which he referred in the course of his remarks. He spoke about the spirit of ARDA. But as I look back on the history of that project, all that I recall the federal government saying at that time was that they were willing to invest some federal funds in this project for the rehabilitation of agriculture across the country, while the real work was done by the ministries of agriculture in the different provinces. That is probably not wrong; and is as it should be. But what was


needed in those days, as it is needed now, is the motivation and the desire, as well as the necessary mechanics, to make sure that consultation to these ends should take place at both levels and at the time it is called for.
Mention might be made of the whole program of vocational training. We have a number of fine institutions built with the taxpayers' money across this country. We have one such institution in my home city and I am sure many other hon. members have similar institutions in their own communities. Here again, there was a woeful lack of consultation before this program was put into operation. Its result is only too apparent. In many instances building construction was completed far in advance of the actual need. In others, buildings were located in places where it was impossible to give maximum effectiveness to the program. This emphasizes once again how important it is to make sure that when the federal government brings forward any proposals or any legislation which overlaps certain functions of the provincial governments, such proposals should be carried out only after there has been the necessary consultation.
The hon. member for Qu'Appelle was perfectly right to point out that businessmen and even politicians could work together when they put the interest of their country first. I am confident, as I have said before, that no one individual, or no one group in this house, has all the answers to the problems which we face today. If we expect co-operative federalism to mean anything, then it is time we demonstrated a spirit of co-operative parliamentarianism in our work here as well. We can do with plenty of this co-operative spirit in the house. I share the enthusiasm the hon. member for Qu'Appelle displayed about the way we do things out west. I believe the two Social Credit governments in the west are an example to us, particularly with regard to resource development in the interest of their people. Looking across this nation I believe any prime minister would be hard put to develop on the national scene a government which could equal the efficiency and the standard set by most of the provincial governments in Canada at the present time.
This brings us again to the problem we confront in making Canada a nation. All too often, our provincial loyalties and our sectional interests are more firmly based than our national concern. Here again, if we are to make confederation work, it is essential we should begin at the national level so that the impact of what we are doing may spread to the provinces. Already many of the provinces are ahead of us. When we look at the machinery which exists to provide for cooperation between the federal government

and the provinces, machinery which the present government inherited from the previous Conservative government and which they, in turn, inherited from the previous Liberal government, we find it is pitifully inadequate.
Perhaps it is because of the commission on biculturalism and bilingualism which has just begun its work; perhaps it is because there is so much talk in our country now about whether we are to survive as a nation, that I am concerned about interpreting afresh what was in the minds of the original fathers of confederation when they brought into being the Dominion of Canada, to which has been added the succession of provincial divisions since 1867. As I study these early debates and the proceedings of the Quebec conferences which were beginning to take form about 100 years ago today, I find there were two basic principles involved. First, there was a determination to make one nation of this country despite all odds and discouragement. We might say that there was a negative motivation then, because there was a strong desire that this part of North America should not simply fall into the hands of the United States. But whatever the underlying purposes were, these men faced tremendous decisions and tremendous problems which in my view were greater in their day than those we face now. But they did so and they succeeded because there was a determination to make sure that a nation, Canada, came into being and that it did so on such a basis that it could survive.
Second, there was the determination that in making this nation the freedom of every individual would be preserved, that every inhabitant would have the right to preserve his traditional way of life and that in so far as possible these rights would be preserved by law and constitutional safeguards. This did not just apply to the individual. It also applied to the individual provinces concerned. This is why when we go back and study the terms of the act which gave us this country, Canada, we find there were certain definite safeguards outlined and that the authority of the provinces and the authority of the federal government were defined. I maintain that if there were a little greater concern and determination on our part today to make sure that Canada remains a nation and if there were just a little more determination and clearcut thinking on how we can safeguard the rights of the provinces and at the same time give ourselves a federal government that would project itself into a continuing nation, we would not have all the problems we face now.
The second principle of protecting individual rights and provincial rights is in direct contrast to the melting pot theory that
Lack of Consultation with Provinces has been so common and so dominant in the political development of the United States. It was the basis of confederation and is the very essence of Canadianism today. I believe it is to these two guiding principles that we refer when we talk about the spirit of confederation, that very spirit which is at the heart of Canada itself. If we can face our present problems unitedly in the same spirit of purpose and in the same spirit of intent, then Canada and Canadians can look forward to the future with more enthusiasm and more optimism than is the case at the present time.
The instrument that was designed to carry out these purposes was the statute passed by the United Kingdom parliament that we know as the British North America Act. This act constituted the original provinces into a new nation, Canada. Most significantly, it abandoned the original idea of a single unified government consisting predominantly of French Canadian Lower Canada and Anglo-Saxon Upper Canada and divided them into the two provinces which are our largest provinces today, the provinces of Quebec and Ontario. It reserved matters of legislation for the federal government, and this was essential if Canada was to become a nation. But it also reserved certain subjects of legislation for the provinces, generally those of a local nature as we can see if we study the document. It gave the assurance that the individual rights of the provinces and of the people who live in those provinces would be safeguarded. It embodied certain guarantees of religious liberty and freedom in education and, whether intentionally or not, it made sure that these techniques would be made effective by requiring that no constitutional amendment could be made without action first by the United Kingdom parliament.
Undoubtedly, however, the development of Canada has in some ways not taken place as our founders intended that it should. This is the reason for the discussion we have today relating to the co-operation and the working together of the provincial governments and the federal government here in Ottawa. As I have already mentioned, I believe that the provinces in many ways and in spite of their difficulties have done a better job than has been done at the federal level. Many Canadians, and this does not apply only to the people of Quebec, have a loyalty to their own province, their own people and their own characteristic ways of life that runs more deeply than their loyalty to Canada as a nation. This is understandable and it is not a basically undesirable thing.
But this does bring us to the point that in one area we have fallen short of the original intention of the founding fathers, to

Lack of Consultation with Provinces make Canada a nation. In too many cases there has been a complete lack of continuous liaison between the federal and provincial governments. In some areas, indeed, the provinces have been forced, through lack of federal action in a field, to assume powers that originally were contemplated to belong to the federal authorities. We have come a long way from the intention of our founding fathers that, come what may, we would make a nation.
In the last two election compaigns the Social Credit party has insisted that the federal government should take a more realistic approach to the problem of liaison with the provinces. We have talked about it continually in the house. During the private members' hour in the last parliament it was my privilege to present a proposition based on this very same thing. We intend to do the same again in this parliament. The proposition is simply that it is time that the federal government established, not just a secretariat but a full and complete department with a cabinet minister in charge of it which might be called the ministry of federal-provincial affairs. This ministry would be charged with the responsibility of working out those matters which relate to both levels of government.
In reading the agenda of the forthcoming conference with the provincial premiers on November 25 I am very pleased to find that under item 5 there will be a discussion of continuing federal-provincial liaison arrangements. I would urge the Prime Minister at this time to seize this opportunity to discuss with the provincial premiers their opinions with regard to setting up such a department at the federal level. This is not a new idea. It is something that a great number of men concerned with provincial governments are talking about now, and already several of the provinces have taken the lead and have set up their own departments of provincial-federal affairs. I mention this now because I think this is an excellent and opportune time for definite discussions to take place towards this end.
This country is in urgent need of development on a national basis from the point of view of national programs. We need a national highways program. We will never have a system of national highways if we look at the matter only from the point of view of sectional interest alone. The use of our water resources is also a very important matter. The problem of water pollution is something that concerns the nation as a whole, and measures cannot be planned effectively except on an interprovincial basis. There is the question of a national electric grid, which is something that at the present time requires

more action and less talk. There is the matter of federal-provincial financial arrangements which is highlighted by the request of Premier Lesage of Quebec. Many of the points Premier Lesage is asking for, as he seeks to meet the fiscal needs within his own province, are the very items that were guaranteed in the original confederating arrangement. They are things which more than just one province is thinking about and talking about today.
We have heard some discussion this afternoon relating to the various cost sharing programs; but why, and under what definition of administrative efficiency can we expect, or should we expect the federal government to be collecting taxes, which in turn it hands back to the provinces? In order to hand them out, it has to retain a certain amount of control. Why should not the federal government step out completely from some of its tax collecting fields and give the provinces the responsibility?
If I understand correctly what I read in the papers and hear from different politicians at the provincial level, the whole question of hospital insurance is in desperate trouble at the present time. We will need a federal-provincial conference to talk about this before too long. There is also the question of the federal government's responsibility in the field of health. Mr. Speaker, it is not good enough that we continue as we have been going on.
Not to belabour the point, or take too much time in the discussion this afternoon, I would only say that if the federal government is not to become hopelessly bogged down in the future, in introducing programs here and withdrawing them there, making enemies of the provincial governments more through clumsiness than through conflicts of policy, such a ministry or department of government is urgently required. Such a department could provide the channels of organization and communication, backed by the authority of a minister of the crown. It would on a permanent basis be able to discuss with the provincial governments the impact of the different levels of government on each other.
This proposition is not something new. In the United States, which has a federal government set-up, there is a secretary of the interior whose basic responsibility is the very thing I am talking about. In the commonwealth of Australia, where the autonomous rights of the states are even more clearly defined than some of the rights of our provinces, it has moved forward to take such action.
I would respectfully urge the Prime Minister to consider this, and consider it in

the immediate future. We should not be dragging the provincial premiers to Ottawa every three or four months, each time a problem comes up on which their advice is needed. This is the type of crisis government which has been too typical of our federal administration for too long. Why cannot we see into the future and anticipate some of these problems before we come to them? That is why the consultative aspect of government, particularly on the federal government level, is something which is most urgent.
My sincere hope is that this coming federal-provincial conference will be the starting point for some permanent means by which provincial consultation in all fields can take place. Somehow I wish yesterday had not been a holiday. Our debating time on this important subject is limited now because the debate on the supply motion closes tonight. I do hope we can come back again to this very important problem during the course of the present session and hear from all corners of the house so that we can demonstrate effectively, not only to the nation at large but also to ourselves, that co-operative federalism begins at this moment through co-operative parliamentarianism in this chamber.


Gilles Grégoire: Mr. Speaker, I am very pleased about the present discussion, because it will allow us to become aware of the situation prevailing in Canada, since the need to make the necessary suggestions is being felt.
It is a comfort to know that the present debate, after many other occasions, is an indication at least that people are eager and willing to use their brains in order to find solutions to the problems now existing in Canada with regard to the relations between the two great races.
Mention was made of joint programs, of the action taken generally by the federal government in that field, as well as all the problems regarding federal-provincial relations.
This situation has been simmering for a long time.
Personalities from all political parties, from the federal and provincial governments, from the business world and universities regularly discuss it.
I should like to quote a few excerpts from various conferences showing the importance of the problem. Thus, on October 3 last, the hon. member for Iles-de-la-Madeleine (Mr. Sauve) mentioned, as reported in Le Devoir of October 3, 1963, the following:
The hon. member for Iles-de-la-Madeleine stated yesterday in Montreal that the time had come for the federal government to withdraw from provincial fields of jurisdiction, especially the social security field.
Lack of Consultation with Provinces
That was the hon. member for Iles-de-la-Madeleine speaking.
The leader of the Union Nationale party stated last June 16:
If Ottawa does not meet the demands of the younger generation, we will eventually be faced with separatism.
The premier of Quebec, the Hon. Jean Lesage, stated, as reported in the Globe and Mail on October 1, 1963:

On the question of joint federal-provincial programs Mr. Lesage said Quebec would always denounce federal incursions into fields reserved to the provinces by the British North America Act.

According to the November 4 issue of Le Devoir, Mr. Rene Levesque, minister of natural resources in the provincial government, also gave his views as follows:
Mr. Rene Levesque stated Saturday that Quebec will have to think of withdrawing from confederation if it is found impossible to have the two great nations of Canada live on equal terms in a federal system. Mr. Levesque added, when asked to deal with the taxation problem, that if Quebec does not succeed in making its opinion prevail at the next federal-provincial conference on taxation, there will be very few chances left to renegotiate the Canadian constitution.
According to La Presse of October 22, 1963, Mr. Gerard Levesque, a member of the provincial cabinet, said:
The old worn out trick of the "fait accompli" will be all the more intolerable as we shall be left with a choice between two equally unacceptable alternatives, abject subordination or total independence.
Le Droit of October 31, 1963, quotes Mr. Guy Rouleau, member of the House of Commons, as saying:
Unfortunately, French Canadians who travel outside of Quebec feel they are in a foreign land.
Mr. Speaker, those are statements which speak for themselves.
On June 29, 1963, Mr. Maurice Sauve said:
French Canadians do not feel at home outside of Quebec borders, and we feel also that the federal government is not truly our government.
Mr. Speaker, here is indeed abundant proof that we should stop and consider this national problem.
Today, the hon. member for Qu'Appelle (Mr. Hamilton) and the hon. member for Burnaby-Coquitlam (Mr. Douglas) spoke in favour of joint programs.
The hon. member for Burnaby-Coquitlam even referred to the statement made by the premier of British Columbia to the effect that, under the equalization program, the province of Quebec had received $65 million more than it had contributed, and that it had everything to gain by remaining within confederation.

Lack of Consultation with Provinces
Mr. Speaker, I took the trouble to look up the most recent statistics and I find that it gets less than its contribution to joint programs. In fact, under our federal system, it gets much less than it contributes. All my figures are taken from statistics prepared by the federal government.
Let us take first of all the annual report of the Department of Forestry for 1962, that is the last one which is available.
Out of a total amount of $11 million paid by the federal government to the provinces in respect of forest inventories and reforestation, the province of Quebec receives absolutely nothing.
As for the grants to the provinces for forest fire protection and forest access road construction, the province of Quebec got $1,277,233, that is 18 per cent of the total amount of $8,823,680.
Again, the province of Quebec has not received a penny of the $4 million which the Department of Forestry has provided for air spraying operations.
My province has received nothing either of the $13 million paid out by the federal government for reforestation under forestry agreements. That is the situation within the Department of Forestry.
Let us come now to the report of the Farm Credit Corporation for the fiscal year ended March 31, 1962, the last report which is available. We find that only 1,869 mortgage loans amounting to $7,074,000 were granted in the province of Quebec out of 34,175 loans amounting to $217 million.
So, I say that the $65 million paid out to the province of Quebec under the equalization system is already more than offset by those various grants.
In fact, if we consider what has been received by some provinces much smaller than Quebec, we see for instance that Alberta borrowed $46 million, Saskatchewan $66 million, Manitoba $15 million, Ontario $65 million and, as I have already said, Quebec $7 million.
And the allotment by province of farm loans approved during the year ended March 31, 1962 indicates that out of 5,885 loans made in Canada, only 109 were made in the province of Quebec, that is 5 per cent; besides out of the total amount of loans, that is $68,574,000, Quebec received only $1,786,000, when loans made in Ontario amounted to $17 million, $5 million in Manitoba, $19 million in Saskatchewan and $18 million in Alberta.
A study of the same report reveals that out of 20 supervisors of credit working for the corporation, two are assigned to Quebec, five to Ontario, two to Manitoba, four to Saskatchewan and five to Alberta.

Of the 132 credit advisers in the country, four are in the province of Quebec, 25 in Ontario, 12 in Manitoba, 36 in Saskatchewan and 32 in Alberta.
Mr. Speaker, it is easy to understand why the former premier of Saskatchewan declares himself for joint programs, when in his province alone, there are 36 credit advisers of the Farm Credit Corporation, while there are only four in the province of Quebec.
In analysing the report entitled Technical and Vocational Education in Canada, published in English only, one sees that the federal government's share in the building of technical schools in the province of Quebec amounts to $25,714,000 while it amounts to $200,017,000 in Ontario. On the other hand, the province of Alberta, much smaller than Quebec, has benefited from a federal contribution totalling $37 million, as compared with $25 million contributed to Quebec.
Mr. Speaker, this does not apply only to this government, but rather to all the governments which succeeded one another over many years.
The annual report of the Department of Labour for the fiscal year ending March 31, 1961 reveals that in the field of training given the unemployed, the federal government has largely contributed, and that out of a total of 10,774 there were 4,170 unemployed registered under this scheme in the province of Quebec. I believe that it is in this respect that the province of Quebec gets the most assistance because it has more unemployed than any other province in Canada.
On the other hand, for vocational training of the handicapped and for federal grants, we find that total payments amounted to $329,566 in 1961 and that nothing at all went to the province of Quebec.
As for training in primary industries and in domestic economy, the federal government paid out a total of $100,877.03 in grants and the province of Quebec received absolutely nothing.
Mr. Speaker, I see that the Secretary of State (Mr. Pickersgill) is in his seat and I shall take this opportunity to discuss the annual report of the Canadian civil service commission for the year 1962. In so far as the grouping of the federal government employees by provinces is concerned, we find out that out of a total of 201,657 federal civil servants, the province of Quebec has only 31,952, that is about 15 per cent, while the province of Ontario has 87,369.
Those figures, Mr. Speaker, are thought provoking.
Mr. Speaker, if we take the annual report of the Department of National Health and Welfare for the fiscal year ended March 31, 1962, we find that the payments made by

Canada to the provinces taking part in the hospital insurance scheme amounted to $678,533,000. I suggest the hon. member for Qu'Appelle and the hon. member for Burnaby-Coquitlam have a look at the statistics to see whether or not the province of Quebec wishes to keep on participating in joint programs.


An hon. Member:: One would have to see Mr. Bennett.


Gilles Grégoire: The premier of British Columbia is the same as the others.
Out of this amount of $678,533,000, which is the total sum paid by Canada to the provinces taking part in the hospital insurance scheme, the province of Quebec received $86 million, Ontario, $274 million, British Columbia, $81 million-that is nearly the same as the province of Quebec.
Let the premier of British Columbia say that Quebec gets more than the others if he wants to. He is getting $81 million out of a total of $678,533,000, while Quebec only receives $86 million. Saskatchewan got $52 million, Alberta, $61 million and Manitoba, $46 million. Those three provinces together are smaller than the province of Quebec and yet they receive twice as much.
Mr. Speaker, those figures speak for themselves.


Thomas Clement (Tommy) Douglas: Mr. Speaker, would the hon. member permit a question? Is it not true that the provincial governments get a percentage of what they spend, and therefore if they spend more, they get more?


Gilles Grégoire: Mr. Speaker, even if it was spent according to a quota, as suggested by the member for Burnaby-Coquitlam, it remains just the same that the figures are there and that, if you talk about dollars and cents, we help through our accumulated taxes, to make up that total amount. And what amount do we get? That is the difference.
Now, Mr. Speaker, I submit that, in the province of Quebec, the hospitalization needs of the population are as great as in the other provinces. But, in our province, it often happens that sick people have to wait three, four and even five weeks to be admitted to the hospital because there are not enough beds.
But if the province of Quebec received its share of revenue, then it could build its own hospitals.
I think, however, that I could answer the question asked by the member for Burnaby-Coquitlam.
It happens that the province of Quebec, because of its mentality, its desire to grow according to circumstances that are peculiar
Lack of Consultation with Provinces to the French Canadian group, often does not accept all the federal government's laws and regulations. That is precisely why the province of Quebec does not get all it should from joint programs.
Now, if you look at the statement of federal payments for assistance to old people, the blind and the disabled-when the figures are favourable, they must be quoted also-you will find that out of $16 million, the province of Quebec gets $7,460,000, or almost half the total amount. I wish to give all the figures, those that are in our favour as well as those that are not.
By the same token, according to the federal-provincial agreement on unemployment insurance, the province of Quebec received in January, 1962, $2,957,000, out of a total of $10 million, that is to say approximately 30 per cent.
As far as the geographical distribution of full time jobs is concerned, on March 31, 1962, the province of Quebec had 358 such jobs out of a grand total of 5,213. Those figures are taken from the annual report of March 31, 1962, issued by the Department of National Health and Welfare.
If we look at the annual report for 1962, which we have just been given, I mean ARDA and not the Farm Credit Corporation Act, we will find in it highly significant figures.
Some of the loans are categorized according to provinces or to objectives, there are loans for buying new or second hand farming implements, loans for construction, repairs and alterations of houses and other farm buildings, loans for buying of cattle, and loans earmarked for various improvements. Out of a total of 72,621 loans, 3,244 loans have been granted to the province of Quebec, 13,508 loans to Ontario, 9,639 loans to Manitoba, 20,368 loans to Saskatchewan, (observe the difference with Quebec), 21,523 to Alberta.
If we express the total in dollars, we see that out of $118 million, Quebec has been granted $5 million, Ontario $23 million, Manitoba $15 million, Saskatchewan $31 million and Alberta $34 million.
I come now to the loans for the purchase of farm machinery. The province of Quebec got only 2,660 loans out of a total of 55,955, or $3,770,000 out of a total amount of $87 million.
In my opinion, Mr. Speaker, those figures are revealing.
The 58th report of the board of transport commissioners December 31, 1962, also contains some interesting figures.
In fact, statement 1 of appendix B, entitled "Expenses by population for grade crossing protection from 1909 to December 31, 1962"
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Lack of Consultation with Provinces indicates the percentage of population and the amount paid out of the railway grade crossing fund. Out of a total of $62 million, $8.7 million were spent in the province of Quebec. With 28 per cent of the over-all population of Canada, Quebec got only 13 per cent of the amount paid out of the railway grade crossing fund. Ontario, with 34 per cent of the national population, received $31,950,000, which is 50 per cent of the total amount.
As for grade separation, reconstruction of grade separation and relocation of public facilities, Quebec got only 24 projects, or a measly one eighth of the total number of 194.
Of the 582 automatic signaling devices covered by the grade crossing improvement program, 76 were installed in Quebec, 70 in Alberta and 260 in Ontario.
Those are self-explanatory figures, Mr. Speaker.
Out of a total of 1,380 other projects carried out under orders issued by the Board of Transport Commissioners for Canada, 288 were in the province of Quebec-that is 1 out of 6-454 in Ontario and 240 in Alberta, that is more than in the province of Quebec.
We could keep on giving statistics of that kind. Let us have a look at the Post Office Department, for instance, and more particularly at the annual report for the year 1962. Under the following heading "Address-book, sales and distribution", one can see that out of a total of 9,739 post offices, 1,532 are located in the province of Quebec, 3,112 in Ontario, 1,329 in Alberta and 1,103 in Saskatchewan. Those are statistics that speak for themselves.
According to the 32nd annual report from the fisheries department, that is available in English only, mind you, total expenditures for all provinces in 1961-1962 reached $23,097,000. How much has been spent in the province of Quebec-$555,473 or 2 per cent of the total amount. In Ontario, the amount was $394,000, a little less than in Quebec, in British Columbia, $8,165,000; in New Brunswick, $2 million, that is four times that of the province of Quebec, and in Newfoundland, $4,600,000, which is almost ten times the amount spent in Quebec.
Now, let us take the report of the Department of Northern Affairs and National Resources. There is a whole list of statistics; I will skip over some of them and will mention only the most important ones-development of roads leading to resources.
According to the 1962 report, Canada has spent $747,000 up to now for the province of Quebec out of a total of $34 million. No other Canadian province receives less than the province of Quebec. Newfoundland's share is $1,929,000, Prince Edward Island's, $3.5 million, and the province of Quebec gets


only $747,000, while Saskatchewan receives $4,457,000. Those are the figures, Mr. Speaker.
Let us look now at what we give. It will be interesting also to see what is given to the federal government in return for what is obtained.
I find, for instance, in the report of the Department of National Revenue, statements of the returns yielded under the Income Tax Act and the Estate Tax Act for the fiscal year April 1, 1961 to March 31, 1962. This is the last report that I could get in French. For the province of Quebec, the total is $925,722,000 out of a grand total of $3,588 million, that is 28 per cent in proportion to the population. In this case, we do pay our share.
If we look at the general income tax and the old age security tax under the heading "Direct payments by individuals", we find that the province of Quebec pays $130 million out of $557 million. Here again, we do pay our share. Under tax deductions at the source, we find that Quebec pays $339 million out of a total of $1,530 million for all Canada. We do pay our share.
With regard to the tax on the profits of crown corporations, the province of Quebec provides $405 million out of a grand total of $1,303 million. When it comes to paying, Mr. Speaker, the province of Quebec pays its share indeed.
Now, let us consider the excise tax: $410 million. If we refer to the table entitled: "Summary by provinces"-we have to look on the back of the report to find the French titles-we read the following:
Report of the Department of National Revenue, including summaries concerning the proceeds from customs and excise and other services, etc. ... for the fiscal year ended March 31, 1962.
Total receipts for import duties, sales tax, other taxes or excise taxes, various levies; total receipts for the province of Quebec $410 million; the province of Ontario, $497 million; plus the receipts from the regional offices, that is an additional amount of approximately $500 million and another sum of $50 million for the province of Quebec. We do more than our share in this field. And what does the province of Quebec receive in return?
When it comes to storing nuclear arms in Canada, over two thirds of the nuclear bases are located in the province of Quebec.
Such is, Mr. Speaker, the contribution of the province of Quebec. And we are told that we must maintain this co-operation. Well, I say we give but we do not receive proportionately to what we give.
They talk about the $65 million which we draw under the equalization plan, but this is offset by the contribution we make, as all

other provinces, to all joint plans, but from which we do not receive the share to which we are entitled.
It is not surprising there is agitation going on at the present time in the province of Quebec.
I think, Mr. Speaker, that we did our great part and that we are in a position to ask that this system be reconsidered, to ask that the province of Quebec be allowed to deal from now on with its own problems and find by itself solutions to them.
Time has come, Mr. Speaker, to set out exactly what the province of Quebec wishes and what it expects of a reconsidered constitution and a revalorized confederation.
First of all, and I think that the evidence which I presented at the beginning by quoting various excerpts of speeches given by ministers of the government of Quebec is conclusive on that point, the most important point on which we, Quebeckers, are insisting, is that the fiscal agreements must be reconsidered so as to restore to the province of Quebec its sources of revenues in order that it can develop in accordance with its own aspirations, its own culture and its own atmosphere, in short in accordance with the culture proper to French Canadians. That is the first point to consider.
We want to put an end to joint programs. We are convinced that if the province of Quebec is given back its own sources of revenues, so that we can levy ourselves taxes which we need for our own development in the province of Quebec, then we will settle the most important of the problems which are now facing confederation.
I should like to point out to the present government and to the Prime Minister in particular that the province of Quebec unanimously support the ultimatum given by its premier (Mr. Lesage) concerning the 25 per cent of corporation taxes, 25 per cent of personal income tax and 100 per cent of succession duties. At the time, Mr. Lesage stated that that was only a beginning.
Indeed, the final objective-


Mr, Deputy Speaker:: Order. I regret to interrupt the hon. member but his time is over, unless there is unanimous consent of the house to allow him to finish.


Gilles Grégoire: Mr. Speaker, I shall be through in four or five minutes.


Some hon. Members:: No, no.


Mr. Denis:: Not more than five minutes.


Léon Balcer: Go on.


Gilles Grégoire: Mr. Speaker-
Lack of Consultation with Provinces


Mr. Deputy Speaker:: Order. I do not think that the hon. member has unanimous consent. Order-


John Whitney Pickersgill: I would hope the hon. gentleman would be given another five minutes to complete what he has to say.


Gilles Grégoire: Mr. Speaker, I wish to thank the Secretary of State and the hon. members of this house as well; I will only take five minutes to make my representations and draw the conclusions from the figures which I just mentioned.
The first means is the fiscal readjustment up to 100 per cent of our sources of income. And this has indeed been agreed to by the Prime Minister of Canada himself in a statement which he made in the house on December 17, 1962 in connection with the problem of bilingualism and biculturalism in this country. Here are his words:
It is now clear to all of us, I think, that Frenchspeaking Canadians are determined to become directors of their economic and cultural destiny in their own changed and changing society.
The Prime Minister himself was thus admitting that French Canadians are determined to become directors of their economic and cultural destiny in their own changed and changing society. We realize that and it is for this reason that we have given top priority to this plank of our platform. There is no way to save our culture if we do not control our income sources, if we do not control our economy, if we do not control our spending capabilities, so that our expenditures will be tailored to our own revenues and our own requirements. That is the first condition which will allow us to save our culture.
I heard a moment ago the hon. member for Burnaby-Coquitlam tell us that the government would emerge weakened in its taxation policies if it gave up joint programs.
To this, Mr. Speaker, I must say that the government will never be weakened in its economic and fiscal system, or, rather, that it should not base its economic and fiscal policy solely on the levying of taxes from the people, it should base its economic and fiscal policy on something other than the taxes paid by the people, it must base it rather on the assets and the possibilities of development of the country, and not on the taxes it is able to collect.
The Minister of Finance (Mr. Gordon) in the budget he presented last June made the same remark. I would tell him it is why French Canada, at the present time, does not wish to be controlled in its economy and claims 100 per cent of its total sources of revenue.
4640	HOUSE OF COMMONS
Lack of Consultation with Provinces
There are other subjects, other problems, which must be settled, but I believe they will easily be settled as soon as a re-shaping of the constitution takes place so that two races shall live side by side without discrimination is allowed to develop economically The day this is realized the French Canadian nation is allowed to develop economically and culturally, then it will be possible for understanding to exist between the two races in the country, and those two great races will be able to develop by themselves and for themselves. Until then, it is useless to think of it.
Mr. Speaker, in concluding, I call for the co-operation of everyone and I ask them to understand before it is too late. If some people, lately, feel an obligation to make statements on separatism, nationalism, the future of confederation and the future of joint programs, it is because they feel there is a problem in Canada. That problem must be dealt with. I ask everyone to seek a solution in the right direction and co-operate before it is too late.
We must realize our present situation instead of trying to elude the problems, but we must seek a legitimate, an appropriate solution before it is too late. That is the wish I should like to express.
Let us realize that at the present time, the French Canadians would like our two great nations to be able to live on the same footing and in an equal partnership.
Before the royal commission on bicultural-ism, a spokesman for the Ontario junior board of trade recently suggested that the French Canadians have been complaining for a long time. That is why our position may now seem demanding. That same spokesman for the Ontario board of trade also stated that bi-culturalism is no problem because a century ago, French Canadians were 60 per cent of the population, they are now 30 per cent, and in 100 years from now, they will not even number 10 per cent of the population of Canada.
That is possible, but before it happens, before it is too late, Canadians want to consolidate their position and they want a confederation founded on a basis which would give more weight to the fact that they are a nation which they want to develop by themselves and for themselves, regardless of their numbers.
Only the government of the province of Quebec can ensure blossoming of French culture. We do not rely any longer on the Ottawa government for the development and expansion of that culture, and that is why we want to have 100 per cent of our financial

possibilities with which we will be able to develop by ourselves and for ourselves.
People want a strong Canada based on the two greatest cultures in the world, the English culture and the French culture.


Lester Bowles Pearson: Mr. Speaker, I think all members of the house will be grateful to the hon. member for Qu'Appelle (Mr. Hamilton) in at least one respect-that he moved an amendment which made it possible for this house to discuss what is perhaps the most serious domestic question which faces us at the present time- as important a question as any which has faced Canada for many generations, because it is one which goes beyond the narrower limits of fiscal and other relations between the provincial government and the federal government; it goes into the whole question of confederation and, inside confederation, the relationship between the two founding races.
Perhaps I might be permitted to say at the outset that I agree 100 per cent with the closing words of the hon. gentleman who has just resumed his seat, if I understood them correctly, to the effect that it must be possible within confederation for Quebec to develop its own identity, its own rights, and to enjoy its own privileges, but inside a strong and united Canada. I should like to express my appreciation of the constructive and forward looking contributions made to this debate by the hon. member for Burnaby-Co-quitlam (Mr. Douglas) and the hon. member for Red Deer (Mr. Thompson) speaking on behalf of their parties. I think they treated the subject as it deserved to be treated and as I think it can be treated in the House of Commons, namely as one which is of an importance beyond party politics, even though it is impossible at times to discuss it without bringing party politics into it. Because we are all human, especially, perhaps, those of us who sit in this House of Commons. But the subject has been raised to a high level of debate by the contributions I have just mentioned and I hope I shall be able to keep it at that level.
I agree with the hon. member for Burnaby-Coquitlam that on the eve of a provincial conference, where very far reaching decisions will be made affecting the future and the destiny of our nation, it is more important to work out policies which will achieve the right objectives of strength and unity-unity without uniformity-than it is to allocate, at least at this time, praise or blame for what has been done or neglected in the past. Perhaps the hon. member will allow me to say that it may be a little easier for the hon. member for Burnaby-Coquitlam to do that than it

would be for the right hon. gentleman opposite and myself, because up to the present, at any rate, not having experienced the privileges and responsibilities of office, the hon. gentleman and his friends have no record, in this respect at least, on which they can be praised or blamed. I hope, therefore, the hon. member will not think me disrespectful if I say it is somewhat easier for them to put on the cloak of purity and perfection in this matter than it is for us, who are the products of everything that has gone on before.
The hon. gentleman who moved the amendment adopted what I have often heard referred to by himself and his friends, when they were sitting on this side of the house, as a scattergun approach to a motion of no confidence. I cannot help but recall-and I do it, as Humphrey Mitchell used to say in this house, "in a kindly way,"-that when we erred in that respect, when we were on the other side-and I was one of the sinners in this regard, talking for a long time on a variety of subjects dealing with what I considered to be the iniquities of the government of that day before coming to the motion of no confidence-


John George Diefenbaker: You have not changed in that respect.


Lester Bowles Pearson: We all change, depending upon where we sit. Some change for the better, and some change for the worse.


Some hon. Members:: Hear, hear.


Lester Bowles Pearson: But hon. members opposite will certainly recall the indignation which used to be expressed at that time by the leader of the house, the hon. member for Winnipeg South Centre (Mr. Churchill) and by the former minister of finance, Mr. Fleming, because we were out of order in making that kind of approach to an amendment. Well, we did not raise this point today, and I am glad we did not because the hon. member for Qu'Appelle was able to roam far and wide over the whole field of government iniquity and opposition purity. He was, in doing so, unduly preoccupied, I thought, with personalities and partisan matters but I make no complaint on that score.


Herbert Wilfred Herridge: He did it in a kindly way.


Lester Bowles Pearson: Well, once or twice I was tempted to think he fell from grace in that respect, but perhaps I am unduly petulant these days-or, at least I am, according to one of the hon. gentlemen opposite. He was certainly preoccupied with the record of his party, which is understandable, and to that record he gave a paean of praise based on press clippings, on books and on some autobiographical material of his own. He was also
Lack of Consultation with Provinces very preoccupied-and he looked hard at me when he got on to the subject-with the leadership of this government and of this party. I admired, 1 was about to say, his audacity in dealing with this matter of leadership. He talked from time to time about divisions within this government because of its leadership, and about disunity inside the cabinet. He even went on to compare this with the great days of a year, two years, three years and four years ago and said that there were hornets nests stirring around the leadership today and there were no hornets nests stirring around the leadership in those days. I will leave him to his reminiscences on that matter.
Toward the end of his statement he moved this amendment:
That this house condemns the government for its failure to carry out the spirit of co-operative federalism and for its neglect to consult with the provinces before announcing or undertaking programs which fall wholly or partly within provincial jurisdiction.
As the hon. member for Burnaby-Coquit-lam (Mr. Douglas) pointed out, he has condemned us for our failure in the field of cooperative federalism after less than seven months in office, during which time, Mr. Speaker, there has been constant consultation with the provinces. I think it will be shown by the forthcoming conference with the provinces that that consultation and the spirit in which it has been conducted will be successful in terms of results from that conference.
I am sorry that the hon. gentleman is not in the house at the moment because I dislike talking about him while he is not here. I am sure he has a very good reason for being away. He may be on television again. He has condemned us because during this period of seven months, and seven months is a very short period in the life a government which will extend for four or five years-


Mr. Starr:: Why do you look at the hon. member for Red Deer (Mr. Thompson) when you say that?


Lester Bowles Pearson: I was not looking at the hon. member for Red Deer. I was looking at the right hon. gentleman opposite when I said that. The hon. member condemned us because we had not consulted with the provinces. Indeed, he used very strong language as to the state of relations now existing between the provinces and the federal government because of our attitudes, our lack of consultation and our procedures and policies. Indeed, we were condemned by one hon. member opposite, whom I am looking at at the moment, in an interjection which indicated that we should not have brought into the

Lack of Consultation with Provinces House of Commons certain policies and certain legislation which concerned the provinces, admittedly without having consulted with those provinces, before we were elected to form a government, which would be a new version of co-operative federalism. With all respect, Mr. Speaker, I do not think we can go quite so far as that in consultation.
The hon. member for Qu'Appelle (Mr. Hamilton), citing various ministerial delinquencies in this field of non-co-operation and non-consultation, mentioned specifically, among others, the Minister of Fisheries (Mr. Robichaud). He gave him, if I may use a vulgarism, quite a going over because in his field he had done nothing to consult with the provinces before the conference on fishery matters with all the provinces, which has been called to meet in January of 1964, I believe.
The Minister of Fisheries gave me the result of some inquiries he had made for me. I wish to point out that already in his relatively short period in office he has met with the ministers responsible for fisheries in Newfoundland, Nova Scotia, Prince Edward Island, New Brunswick, Quebec, Saskatchewan and Manitoba, and he has received specific proposals from each of the ten provinces in connection with the January conference. I think that is a very good record in regard to consultation and a record which I think other ministers could, if not equal, at least approach.
I think we all agree that whatever may have been the practice in the past-by the past I am not thinking only of the last five or six years but the last 25 years-whatever may have been the record, whatever may have been the attitude of the federal governments in those years, the time has now come that we must consult with the provinces in what we now call co-operative federalism on every matter, not only those which are within their jurisdiction, in which case consultation must be obligatory and automatic, but also on all matters that are of direct concern to them.
The hon. member for Qu'Appelle referred to his own experience in this regard leading up to the resources conference. I think that was a desirable and effective initiative on his part and on the part of the former government, resulting in a very constructive conference which was responsible for the setting up of federal-provincial machinery which I agree should be a model for this kind of thing. This is not the first time this has been done, but it is the most recent occasion on which it has been done on such a large scale. As a matter of fact, I do not know whether it has been done previously in this way on such a large scale but I hope it will be the kind of

model we will follow in the future. If it is successful, as I am sure it will be, undoubtedly it will be a model for the future. There may well be that kind of a conference with a council emerging from it of federal-provincial ministers in other fields. Perhaps something will emerge from the forthcoming provincial-federal conference in this direction. I hope so, because that may be the direction along which we should proceed so far as consultation is concerned.
We were also criticized this morning and we have been criticized in the house very vigorously previously as a government, because we did not adopt the right courses in regard to consultation with the provinces on such matters as the municipal development fund, the contributory pensions plan and others. I mention only the two matters now, the municipal development fund, which is certainly within the jurisdiction of the federal government, and the contributory universal portable pension plan, which is also certainly within the jurisdiction of the federal government as the result of a constitutional amendment by agreement with the provinces that brought it within its jurisdiction.
Therefore, constitutionally, the federal government has the right to go ahead in these matters, and in putting forward proposals on behalf of our party when we were in opposition I think we were quite entitled- in fact, there was no other way of doing it- to put forward proposals for a municipal development fund and a contributory pensions plan. We have carried out one of these proposals and we intend to carry out the other. However, when we took on the responsibility of office we were then confronted with the problem which I suppose confronts any government in a situation of this kind, or certainly will in the future. That problem is whether the consultation which is required in respect of a matter in which the provinces express their direct interest and in which perhaps they share jurisdiction-they do in the case of the pension plan-should take place in advance of anything being brought into the house, on the general idea that we should secure their agreement in principle and perhaps even in detail with regard to the legislation before it is even introduced into the house in the form of a resolution. Or whether on the other hand we should consult with them on the basis of a resolution which has been introduced into the house and perhaps even legislation which has received second reading with the idea of changing that legislation in certain circumstances as a result of the consultation.

I think the latter course was the better in the cases I mentioned, and I think it will turn out in the future to be generally the preferable method of consultation, that is, to consult with provincial governments on the basis of a concrete proposal. You do, however, take the political risk in the event of the consultation, of withdrawing in some respects from your own proposals that you submit to them, and you will be accused of altering your proposals, of giving in to pressures and all the rest. But I do not think that is a very high price to pay if, as a result of the consultation and the changes you make, you then have a piece of legislation which will be acceptable not only to the federal parliament but also to the provincial legislatures.


Herbert Wilfred Herridge: May I ask the Prime Minister a question? Would he say under those circumstances what he is doing is that he is actually in effect working from experience by having a motion before the house?


Lester Bowles Pearson: I think, Mr. Speaker, I have said that in these particular cases that was the best way to proceed. I am not going to say this will always be the best way to proceed, but I think it will turn out to be in the majority of cases that require consultation with the provinces.
The contributory pension plan is another example, quite apart from the fact that a decision of a provincial government, in this case Quebec, taken after we had assumed office, made some change in the resolution which we had introduced inevitable in any case. I think we were well advised to follow the course we did in introducing a resolution and explaining that resolution in detail, and then submitting the details of the resolution to the provinces for consideration before proceeding, even though that means, as it will in this case, changes in our ideas, plans and original proposals, but changes which I think will make the proposals and legislation acceptable, I still dare to hope, to all the provinces of Canada.
But in any event this is the kind of legislation on which the federal government can proceed even if one province, one major province, contracts out. In that case, if that contracting out continues-and this is the responsibility of the government in question-we will still have further conferences with the provinces, as a result of which we will introduce legislation which I hope will be acceptable to them, and we will do that without any delay that can be avoided. I give that pledge, because I was asked by the hon. member for Burnaby-Coquitlam whether we still felt the same way about our promise in this field.
28902-5-296
Lack of Consultation with Provinces
We are, as I have said, facing a vitally important conference with the provinces. We had, if I might term it-


John George Diefenbaker: Before the Prime Minister goes on, could I ask whether or not he or the government of Canada were aware of the plan of Premier Lesage prior to the time that the Minister of National Health and Welfare introduced the resolution regarding social security in this house?


Lester Bowles Pearson: No, Mr. Speaker, I was not aware of the decision of the government of Quebec, taken for reasons which I do not quarrel with at all, and with which I am sure my hon. friend does not, but for reasons which were considered very strong in their case. I was not aware of their decision to contract out before we introduced our own scheme.


John George Diefenbaker: What were the reasons?


Lester Bowles Pearson: And I may say our own scheme was drafted on the assumption that all the provinces would be co-operating with it.


John George Diefenbaker: Was the Prime Minister aware of the Quebec position at the time the resolution was introduced, not when the matter was first discussed?


Lester Bowles Pearson: Mr. Speaker, I have not got the dates in question in my mind, but I will be very glad to look that up. I am not trying to avoid the answer. I am not sure exactly when the resolution was introduced or when we were informed by the provincial government of Quebec of the action they were going to take. I will find that out, and it can be found very quickly.
Now, we had in July what I have described as in essence a preliminary federal-provincial conference. These matters of joint concern were discussed. It is quite true that the federal government, as a result of this conference, made changes in certain proposals which it had submitted or intended to submit to the House of Commons. I am thinking particularly of the municipal development fund. But in making those changes in the case of the municipal development fund the principles of the legislation we had introduced into this house were maintained. We did not default on the principles of the legislation which had been introduced. In respect to the contributory pension plan we have made it clear that we propose to proceed with a universal, contributory portable pension plan.
It was suggested, in fact more than suggested, it was stated this morning by the hon. member for Qu'Appelle that relations between the federal and provincial governments had deteriorated, that they were in a bad way and that we were responsible for this. Indeed

Lack of Consultation with Provinces this is the foundation of his motion of no confidence. I think it is necessary, because of what he said this morning, to put on the record some evidence, as he put on the record newspaper evidence to support his case.
I will put on the record statements made by provincial leaders at that conference, as to what they thought about the results of the conference and the way it was conducted. The premier of Quebec, in his press release at the end of that federal-provincial conference on July 27, issued this statement:
The Quebec government expresses its satisfaction for the spirit of co-operation on the part of the federal government and the comprehension of the various provincial delegations.
He went on:
It is now evident that it is possible within the Canadian confederation to find formulas and agreements which give satisfaction to the legitimate point of view of Quebec without depriving the other provincial governments of their rights to obtain different conditions.
Then the provincial secretary of the government of British Columbia told a reporter after the conference ended:
Good will was going out of everybody's ears. We could stand a lot of the co-operation that was established there.


John George Diefenbaker: What did he say the day before yesterday?


Lester Bowles Pearson: I have another quotation from the Canadian Press account of the conference. On July 29, 1963, the Canadian Press reported Premier Lesage as saying in part, and it quotes him:
It would appear that the system of confederation has entered into a new era
And it is evident from his press statement that he meant a better era. Premier Lesage went on to tell the reporter, and I quote from the Canadian Press report:
Never have I seen such a spirit of good will and co-operation.
And again, to complete the quotation:
The former government would say, "We will consider your demand," or "this is our decision." But at this conference, the government was willing to discuss particular amendments to its bills and accept our suggestions.


Louis-Joseph Pigeon: What did Rene Levesque say?


Lester Bowles Pearson: The conference did not have the pleasure and the privilege of having Mr. Rene Levesque as one of its members. Possibly the next conference will, and it may be we will be able to get the same kind of statement from him after it is over.
The Canadian Press report goes on to say:
Senior advisors who have sat through such meetings for years-either on the federal or provincial side-said the kudos, coming from practically all delegates, appeared genuine.

They noted that a communique usually refers to a "spirit of co-operation" but in this case they were "not just words".
This is confirmed by some of the remarks made at the end of the conference, according to Southam News Services, by provincial leaders:
"Great improvement", said Manitoba's Duff Roblin.
"I am happy," said Ontario's John Robarts.
"Everybody's delighted", cried Joey Smallwood expansively.
"This is by far the most successful federal-provincial conference we have had since I assumed office", said New Brunswick's Louis Robi-chaud.
"I'm happy with the result and even more happy with the spirit of the conference", said Alberta provincial treasurer E. W. Hinman.
In the face of that reaction, that response to the conference which the provincial leaders held last July, the hon. member for Qu'Ap-pelle said, on the eve of this forthcoming conference, that he is convinced it is doomed to failure; that it is doomed before it has begun, because of the success of the conference last July. He laments this inevitable failure. I am not sure why he laments it. There were times during his speech this morning when he seemed to lament it because the federal government was going to abandon certain shared programs, or withdraw from them, and at other times he seemed to lament it because we were becoming too centralized and were the historic, old Liberal party of centralism. His speech this morning, interesting as it was, was a little confused with regard to the reason for his lamentations, but they were there.
I do not think any member of this house, whatever he may say in the house, feels that this conference is doomed to failure. It would be a sorry day indeed for our country if it were doomed to failure. It is not doomed to failure; it is going to be successful.


Some hon. Members:: Hear, hear.


Lester Bowles Pearson: The agenda for the conference has been distributed and all members of parliament have no doubt had a chance to read it. Just one glance at the agenda shows how vitally important it is that this conference should be successful. We are going to talk about the state of the Canadian economy, employment measures and unemployment, economic and industrial policies, conditional grants and shared cost programs, including hospital insurance costs and operation, and categorical assistance programs. We are going to talk about fiscal relations, a national agricultural marketing board, the administration of Indian and Eskimo affairs, a Canada pension plan, medical services, provincial lotteries, and continuing federal-provincial liaison arrangements. Therefore it is of the

most vital importance to the future of our country that this conference should not be doomed to failure but should be successful. We on this side will do everything that we can, subject to our responsibility as a federal government, to ensure that it is successful.
The hon. gentleman who spoke this morning was particularly critical of the record of the government, certain statements that had been made, in connection with shared programs and what he was pleased to interpret as a kind of arbitrary and unilateral withdrawal of the federal government, by announcements made inside and outside the house, from these programs and, presumably, by this kind of withdrawal weakening the authority and the responsibility of the federal government in these important fields. He did not quote from it, but he referred to a speech made by the President of the Privy Council (Mr. Lamontagne) on this matter, from which he drew some very gloomy conclusions. Perhaps, Mr. Speaker, I had better read what the President of the Privy Council said. I will read from the text of his speech and would ask my hon. friend whether he disagrees with this. If he does disagree with it, perhaps he will indicate to the house that he does, because he certainly gave the impression this morning that he disagreed with this policy. It will be very interesting to get the record straight on this matter because he spoke, no doubt, for his party on this and other matters this morning. I quote from the text of the speech made by the President of the Privy Council to the Canadian club in Toronto on November 4, 1963:
In the political field, our federalism needs a new orientation. The federal government should be prepared to withdraw from existing and well established joint programs in areas which have been assigned to the provinces and to compensate financially those provincial governments which are willing to assume these additional responsibilities.
I emphasize those words, "which are willing to assume these additional responsibilities". I ask the hon. member now whether he is not in accord with the policy which makes it possible for the provincial governments, if they so desire, to withdraw from certain existing and well established joint programs in areas which have been assigned to them, for which withdrawal they would be compensated financially by the federal government so they should be able to discharge these new responsibilities. I ask the hon. gentleman whether he objects to that; and if he does object to it, presumably this is to be the policy of his party in opposition on the matter of shared programs.


William Heward Grafftey: Mr. Speaker, the right hon. gentleman said last week there were certain 28902-5-296J
Lack of Consultation with Provinces conditions under which the federal government would withdraw from the joint programs. Are those the certain conditions?


Lester Bowles Pearson: Indeed, Mr. Speaker, there is one very important condition, and that is that the provincial governments should wish the federal government to withdraw from certain programs and take on these responsibilities themselves. That is a very important condition and it is on that condition that we have put forward this policy in regard to shared programs, which the hon. gentleman opposite, speaking for his party this morning presumably, repudiates. Let us understand a little better what he repudiates, I go on to read what the President of the Privy Council said:
I am certain that such a general approach to the problems of Canadian unity is completely unacceptable to the extremists on both sides. I am quite sure that it would be supported by most French Canadians as a much better alternative to separatism.
Then he went on to say:
The movement for greater economic emancipation has already begun in Quebec. A federal-provincial conference will be held in Ottawa at the end of this month. I hope that this will be only the first of a series of meetings designed to reconsider and redefine our federal structure of government. A royal commission on bilingualism and biculturalism has been set up and is now getting prepared to hold what I call a referendum on these vital matters. In the meantime, the preparations for the centennial of the Canadian confederation are under way. But we will not have much to celebrate if we fail in those attempts to rebuild our unity. We began in 1864 to develop the compromise which was accepted in 1867. It will not be too early to get to work together in 1964, if we want to celebrate a new alliance in 1967.
I do not take exception, no matter what my hon. friend may say, to that new concept of co-operative federalism expressed in those words. Just to show that this is not a new policy put forward since this party once again took on the responsibility of office, I would point out that this policy in respect to shared programs was first put forward in our rally of 1961. It was a formal part of our election campaign program of 1962 and was put forward as such before the general election of 1962. I want to read these words just to show that this policy is not new. This is under the heading, "We will assure flexibility in joint programs", and it goes on to explain what we mean by that.
If some provinces wish, they should be able to withdraw, without financial loss, from joint programs which involve regular expenditures by the federal government and which are well established. In such cases, Ottawa will compensate provinces for the federal share of the cost, by lowering its own direct taxes and increasing equalization payments.
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Lack of Consultation with Provinces
Again, I ask the hon. gentleman who spoke this morning for his party whether he takes exception to that statement of policy on these matters.
We will be considering these matters at a provincial conference at a time in our history when there is a great deal of unrest in regard to the working out of confederation and at a time when, as the hon. member for Lapointe (Mr. Gregoire) said a few moments ago, there are French speaking Canadians who feel that in the working out of confederation they have not been fairly treated. We have to take that feeling into account. As a result of this feeling, which I think has been stronger during the last year or so than perhaps ever before in our history in peacetime, it is all the more important that this conference which meets in two weeks should be successful in dealing not only with the specific matters on the agenda or in setting up machinery which can subsequently deal with them; but also in developing a new spirit of co-operation between the provinces and the federal government so that all the provinces and all the people of Canada will feel that confederation is working to their advantage and to the national advantage.
In this difficult period through which we are going, on the one hand we have the extremists and, on the other we have the voice of moderation which was heard in this house today. We have on the one hand, the extreme of separatism against co-operation. We have defeatism against faith in the future of our country. We have prejudice, against understanding and we have bigotry against reason as we face these problems of confederation and national destiny. I think it is high time, as I have said outside the house and as other members have said outside, that the voice of reason, moderation and understanding should be heard and strongly heard, as it was here in this house the other night when the hon. member for Three Rivers (Mr. Balcer) spoke. It should be heard both in English and in French. It should be a voice for a country which is greater than its parts, a country which will rise above these agitations and these discords which would reduce our country to the level of separate and competing groups.
I know hon. members of this house will reject, as I reject, any such dismal and disunited destiny for Canada. At the same time I realize, as hon. members realize, that in a federal state with a relatively few people spread across half a continent, a state which would be difficult to govern even if it were a unitary state, there are bound to be today as there have been in the past, pressures pulling us apart which must be counteracted by


stronger pressures to keep us together. Surely, the House of Commons can give a lead to the country in this regard. I think therefore, Mr. Speaker, there should be positive action emanating from this house, certainly from the government, which will achieve that purpose of keeping us together. We all have to admit frankly and honestly that when we talk about these matters while we are thinking not only of Quebec we do think primarily of Quebec, because it is Quebec and the French speaking Canadians who seem to have a sense of incompleteness, almost of grievance in the way confederation has worked out for them.
There is the problem of federalism. There is that of national unity. We have heard about them as linked and in some way complicated by the problem of the relations between English speaking and French speaking Canadians. Because the federal parliament and the federal government have an English speaking majority, although there are 11 French speaking members of the present government, they are inevitably regarded by some people in Quebec as somewhat remote from and perhaps at times almost even hostile to the aspirations of the French speaking people in Quebec. The hon. member for Burnaby-Coquitlam (Mr. Douglas) uttered what I thought were some very wise words this afternoon when he said that our efforts to discharge our responsibilities as a federal government are often interpreted as a threat of some kind to the special position, the special rights or privileges of Quebec as a province inside confederation.
When I listened to the hon. member for Lapointe this afternoon talking about the province of Quebec on the one hand, and the federal government, the federal parliament and the federal authorities on the other, as if these two things had to be separated, I thought to myself that the people of Quebec should also remember they are represented in this House of Commons and in the federal cabinet. While the provincial government in Quebec, of whatever party, will always have a special obligation and a special desire to protect the people of the province of Quebec, as any provincial government would have, let us not forget that that same desire to protect and advance the interests of the people of Quebec is shown by the Quebec members of this house and the Quebec members of the cabinet. Therefore, Mr. Speaker, I reject this idea that there must be some inevitable conflict between Ottawa and Quebec.


Gilles Grégoire: May I ask the right hon. gentleman a question?


Lester Bowles Pearson: Yes.


Gilles Grégoire: First, I should like to say that I never mentioned a conflict between the two governments. Would the Prime Minister admit that when each level of government has its own responsibilities and the means to take care of its own responsibilities, then the areas of conflict between both governments will be eliminated and there will be chance for complete understanding between both governments?


Lester Bowles Pearson: I am sorry if I misinterpreted what the hon. gentleman said. I did not mean to do so. Of course, I agree with him that the greater the clarification of responsibility-and that has been going on ever since 1867, sometimes successfully and sometimes unsuccessfully of the division of taxes, resources and other things-the more clarification that can be brought into these matters, the less likelihood there will be of trouble between the federal and provincial levels of government. I entirely agree with him on that.
Surely, Mr. Speaker, it is possible to believe sincerely and completely in a full and equal French speaking and English speaking partnership, as I think all members of this house do believe, without denying to the federal government enough authority and adequate resources to discharge the responsibilities imposed on it by the constitution, which are essential for the people of the nation and also for the well-being of the people in the provinces, as my hon. friend from Burnaby-Coquitlam pointed out this afternoon. I believe not only that the rights and privileges of the provinces inside confederation are a basic essential for co-operative federalism; I also believe that the federal government must have enough authority to do the job entrusted to it by the people of Canada. Surely these two things can and must be reconciled.
As far as I am concerned, adapting and perhaps misquoting the words used by the hon. member for Burnaby-Coquitlam, who in turn was referring to the immortal words of a very great man, I do not feel that I was chosen to preside over the liquidation of the Canadian confederation. Because I believe in the Canadian nation inside that confederation, a nation strong and a nation united, just as I believe in full and accepted French speaking and English speaking partnership as the only possible foundation for strength and unity. To accuse any federal government of any party, as has been done, of being dangerously centralist merely because it seeks the legislative and financial resources to discharge its Canadian responsibilities is as wrong as it is to accuse a provincial government of being separatist because it seeks adequate revenues, an adequate revenue base, in
Lack of Consultation with Provinces order to discharge its own provincial responsibilities. Federal and provincial responsibilities need not, and should not, conflict in these matters, although it is very easy for that kind of conflict to develop unless there is good will, and understanding on both sides. It is also easy for conflict to develop through the action of extremists on either side, which action produces an extreme reaction on the other side. That is developing in our country today and it is our real danger. These two things must be reconciled, especially-I do not apologize for saying "especially"-in the province of Quebec, which is in so many ways not a province like the others. These things must and can be reconciled; but this reconciliation will not be easy to bring about. It has never been easy to bring about in any federal state, and it will not be easy in Canada either, where we have some very special difficulties facing us in this regard, not only in our relations between the races inside Canada, but also because of the relations between our own country and our neighbour, and indeed our relations inside the Atlantic community.
There is one special situation which arises here-I do not like to call it a problem, although it may be a problem; but it is also an opportunity-when we talk, as we do, about the two founding races. And I think we have a right to talk about the two founding races, because we must remember that there is not, and there is not ever likely to be, a Canadian race. This is especially true if we remember that not only did pioneers from England combine their efforts with pioneers from France to build up this country, but that today almost one quarter of our population is made up of Canadians whose origins are neither French nor English.


Louis-Joseph Pigeon: More.


Lester Bowles Pearson: Someone says it is more than one quarter.


Louis-Joseph Pigeon: One third.


Lester Bowles Pearson: Perhaps it is almost one third if you include the Irish. We sometimes call this one quarter or one third, perhaps inaccurately and rather loosely, "new Canadians". But they are new Canadians who have adopted one or the other of the two official languages in this country without giving up their own culture, their own customs and their own traditions which themselves are making an invaluable new contribution to the development of a new country. One of these people is reported to have said the other day before the royal commission on biculturalism and bilingualism that he was worried about the use of the term "biculturalism", as if it divided all Canadians into two cultural

Lack of Consultation with Provinces groups, either French speaking or English speaking. This gentleman said there could be no second class citizens in this country, that you could not lump all these people not originally French speaking or English speaking into a group which was inferior in any way, or which felt inferior in any way, to other Canadians. Of course there can be no second class citizens of any kind in this country, whether through colour, race or creed. The only way in which we can maintain unity in Canada is by recognizing and glorying in our diversity. Canada is a country which must also be based on recognition and respect of equal rights.
Also very much in our minds as we approach the federal-provincial conference is the fact that there is a constitutional and financial duality to our federalism which must be understood. I have already touched on this. For instance, if the federal government at the request of the provinces, a request they have been making for a good many years-and in any federal system the provincial level of government or the state level of government is bound to make this kind of request-turns over more and more of the shared fields of taxation, or indeed all of them, to the provinces-or perhaps I should be more accurate and say to the provincial governments-then the federal government must either find the money which it has to have from some other source-and ultimately the Canadian taxpayer wherever he lives and in whatever province he may live is the single source-or it must ask the provinces to take over full responsibility for expenditure now undertaken, in whole or in part by the federal government. That, in a nutshell, is the fiscal problem. Again it is a problem of reconciliation between the federal and provincial levels of government. It is not going to be easy for any government in Ottawa to raise more money-and I am looking at the Minister of Finance (Mr. Gordon)-for its own increasing needs

and they are increasing-resulting in turn from the increasing demands made upon it by the people of Canada, the peoples of the provinces. It will be difficult to get the additional revenue required to meet these increases and often perfectly justifiable demands, and at the same time make larger money grants to the provinces, however justifiable the request for such grants may seem to the provinces. The federal treasury has exactly the same limitation as provincial treasuries. They are not self-renewing and each can only be replenished from the same source. There are those who argue that the transfer of both new funds and new responsibilities to the provinces would be the simplest and best course. I expect the hon. member for Lapointe would be among them.


But those who argue in this way sometimes ignore the character of our Canadian federalism. Their argument was met by the hon. member for Burnaby-Coquitlam. There is a great disparity between riches, resources and, indeed, needs, in one province as opposed to another. As we all know, this disparity, which now exists and which is one of the facts of the present situation, has resulted in the concept of the equalization of economic opportunity and social benefits between Canadians in the various provinces as an obligation of the central government. That is now accepted, and it has been for some years-the obligation upon the central government to equalize opportunities and benefits by making the financial resources available in a calculated way to the provinces. We are committed to that on this side of the house as, I understand, all parties are now committed. To keep confederation strong, and to make national unity based on it stable, will require this recognition of the necessity of equalization, just as it requires continuous effort and willingness to adjust our basic constitutional structure to changing conditions.
It is obvious that the founders of confederation and those who drew up the British North America Act could not foresee the conditions which were to exist a century later. They were even uncertain as to political developments in their own time, and this uncertainty led a good many of them to prefer a unitary to a federal Canadian state. Fortunately the federal concept, with all the problems it involves and all the difficulties it created, prevailed. But federalism, if it is to be strong, must be flexible in the sense that it must adapt itself to change. We should not be afraid about that. This means constant re-examination and, when necessary, reshaping the constitutional act and the constitutional structure.
Today of course we all agree as to the necessity for such a re-examination and reshaping. As I have said more than once, and others have said this outside the House of Commons, while it may be a time for the re-examination and reshaping of the constitutional structure it is not a time for tearing down the building on the pretext of repairing and strengthening it. That would be as tragic for our future hopes as it is unnecessary for the solution of our present problems. All I have been trying to say means that there must be a close, continuous and co-operative association between the federal government and the provincial governments.
In the light of the amendment, as it has been moved, I am willing to admit that co-operation should be closer, perhaps, than it has been in the past. I agree, also, that there must be some permanent machinery set up to make this co-operation and this consultation more

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effective in the future than it has been in the past. I cannot refrain from adding, when I say this, that consultation is a two way street in any federal system. While it is important that the federal government should consult the provinces on all matters which lie within their jurisdiction-and indeed it must do so; I believe, also, that the provinces should be consulted, too, on all matters in which they have a great and immediate interest. The federal government should, equally, be consulted by those provincial governments which give effect to far reaching social and economic plans which have a national significance. That is what I mean when I say consultation is a two way street. However, we must provide some continuing machinery for consultation and this is one of the items on the agenda of the conference.
The hon. member for Qu'Appelle referred to this question this morning and indicated that we had turned down a suggestion to this effect put forward by, as he described him, his young friend from Brome-Missisquoi (Mr. Grafftey). But this proposal is not new. It has been put forward on several occasions in the past, but for one reason or another it was never carried into effect. If I may be forgiven for introducing a personal note, I can remember, back in the 'thirties when I was secretary to provincial conferences, asking some of the political leaders of that day why such a system could not be introduced. One of them was Mr. Bennett and the other was Mr. King. I made the same inquiry once of Mr. St. Laurent. The objection at that time, as it was given to me-I think it was valid in its day though its validity has, I think, diminished- was that if provincial representatives were permanently established in Ottawa to start continuous consultative machinery it would amount, almost, to diplomatic representation. The presence in Ottawa of such representatives would tend to accentuate the differences between the provinces and the federal government and, possibly, create a feeling of separation, increasing rather than lessening the differences between the two.
As I say, I think that argument has less validity at the present time than it might have had in those days, and I believe there is a great deal to be said for a provincial secretariat. I think the idea of such a secretariat as a liaison measure between conferences is not a new one. Nova Scotia suggested such an agency 25 years ago in its brief to the Rowell-Sirois commission. The idea was reviewed, later, by the Tremblay commission and in July, 1960, the premier of Quebec asked for a continuing secretariat in his brief to the federal-provincial conference of that year. I hope we shall be able to make progress with this idea at the forthcoming conference.


John George Diefenbaker: Would the right hon. gentleman permit a question? He mentioned a conversation he had with Mr. Bennett. Does he recall what year that was, because my understanding is that Mr. Bennett was in favour of such a liaison and that he came to this conclusion in 1935 shortly before he was defeated. I should like to know when Mr. Bennett made that statement.


Lester Bowles Pearson: I am not trying to hold Mr. Bennett down to a definite statement of policy as prime minister, but I remember asking him about this when we were going over on shipboard to the jubilee imperial conference in London. That would be in 1933 or 1934-[DOT] one of those years.
Anyway, there will have to be changes made, and one of those changes will have to be the development of some kind of machinery for continuing consultation between conferences. Another will be the holding of conferences more often, perhaps periodically, between the provincial and the federal governments.
Meanwhile, as consideration is being given to changes which may be required in our federal relationship, financial, constitutional, and economic, the federal government has to perform its task now, and within the limits of its jurisdiction now; and it has to do what is necessary for the security, welfare and prosperity of all Canadian citizens who, after all, are the same people whether under provincial or federal authority. In the discharge of this responsibility I repeat there must be no suggestion of federal policy being imposed on any province by Ottawa in matters which are in any way within provincial jurisdiction. The federal intention is to co-operate with the provinces in truly national policies which respect provincial rights, while protecting and advancing the interest and welfare of all the Canadian people. This, I submit, is the only way the problem of federalism and of English speaking and French speaking relations as an aspect of federalism can be solved. It is our most important domestic, political problem and it affects our very survival as a nation.
I do not underestimate, and I am sure no hon. member of the house could possibly underestimate, the difficulties in finding the right solution, but I do not wish either to exaggerate those difficulties. Nor as we face those difficulties should we allow our sense of proportion to be distorted by the noise from extremists on one side or the other. One hundred years ago the fathers of our country had no illusions about the task they were undertaking, but it did not daunt them and it did not defeat them. Here is an excerpt from one of the speeches in the confederation debates of 1865.

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An hon. Member:: Were you there?


Lester Bowles Pearson: No, I was not there but sometimes I feel as if I might have been there.


Louis-Joseph Pigeon: The President of the Privy Council was probably there.


Lester Bowles Pearson: I quote:
We are endeavouring to adjust harmoniously greater difficulties than have plunged other countries into all the horrors of civil war. We are striving to settle forever issues hardly less momentous than those that have rent the United States of America and are now exposing it to all the horrors of civil war. Have we not then great cause of thankfulness that we have found a better way for the solution of our troubles than that which has entailed in other countries such deplorable results?
The building of a strong united confederation, Mr. Speaker, on the foundation of the two basic races of Canada is still the better way. That is still the great Canadian challenge as it was in 1865, and I am sure that as our forefathers met this challenge in 1865 the people of Canada will be able to meet it in 1963.
We have had an amendment, Mr. Speaker, and we have had a subamendment moved by the hon. member for Burnaby-Coquitlam (Mr. Douglas). The subamendment deletes the words of the amendment and replaces them with the following:
That this house urges the government to carry out more fully the spirit of co-operative federalism and to consult with the provinces before announcing or undertaking programs which fall to any extent within provincial jurisdiction.
I have been talking now for quite a long time about what we can and should do as a government and as a parliament to carry out more fully the spirit of co-operative federalism and to consult more closely with the provinces on matters which fall within their jurisdiction. So the subamendment moved by the hon. member is clearly not a vote of want of confidence but an affirmation of a principle acceptable to the government.
I assume, Mr. Speaker, that when the hon. member who moved the subamendment talked about "programs which fall to any extent within provincial jurisdiction" he meant that if there is a program inside a joint field that is not a provincial field, and he was referring to exclusive provincial jurisdiction. We interpret the subamendment in that sense and I understand that is the interpretation which he himself gives to it. Therefore, Mr. Speaker, we have no difficulty whatever and, indeed, we are very happy to support the subamendment. If the subamendment should be carried I shall then ask one of my colleagues, under standing order 56 (4)(e) to move that the Speaker do now leave the chair.


John George Diefenbaker: Mr. Speaker, I had not intended to speak-


Gilles Grégoire: May I ask the Prime Minister
one question?


Mr. Deputy Speaker:: Order. There is some difficulty here. The hon. member for Lapointe has risen for the purpose of asking a question of the Prime Minister.


Gilles Grégoire: Would the Prime Minister make some comments on this subject with regard to the requirement from the province of Quebec of 25 per cent of income tax and 25 per cent of corporation taxes?


Lester Bowles Pearson: I could but I do not think I should take any time away from the Leader of the Opposition.


Gilles Grégoire: That is the most important problem.


John George Diefenbaker: Mr. Speaker, the House of Commons is a place where things happen that are unexpected. We had that experience in 1958 in the month of January when, as a result of the activities of the present Secretary of State (Mr. Pickersgill)-he received the honour of having suggested it-an amendment was moved by the then opposition that the government of that day should resign and make way for the opposition.


An hon. Member:: It obviously should have.


Lionel Chevrier: It was premature by just a few years.


John George Diefenbaker: Mr. Speaker, that amendment received its answer a very few weeks thereafter. I followed the Prime Minister today with the greatest of interest in an address that was obviously prepared for the dominion-provincial conference but was utilized today to meet the debate. It is very obvious that an address such as that could not have been prepared as a result of the amendment moved by the hon. member for Qu'Appelle (Mr. Hamilton).
We moved an amendment to the motion to go into supply. We moved:
That all the words after "that" be struck out and the following substituted therefor:
"that this house condemns the government for its failure to carry out the spirit of co-operative federalism and for its neglect to consult with the provinces before announcing or undertaking programs which fall wholly or partly within provincial jurisdiction".
Mark what has happened. The hon. member for Burnaby-Coquitlam has moved that the amendment be amended by deleting certain words. With the deletion of those words, Mr. Speaker, the motion to go into supply is struck out. I point out that the motion is that the house go into committee of supply.

We moved that all the words after "that" be struck out and the following substituted therefor.
The subamendment proposes that our amendment be accepted, except in so far as the changes suggested by the hon. member in moving the subamendment are concerned. That means that if the members of the government support this subamendment they are voting against the motion to go into supply and, as a result, will be voting themselves out of office.
This is one time when they have outsmarted themselves, and I want to go into this in greater detail in the time at my disposal, but I now emphasize the fact that on the one hand there is a motion that the house go into supply, and on the other hand there is accepted a subamendment in which all the words after "that" had been deleted.
I ask you, Mr. Speaker, what is the consequence, and the position in which the members of the government will be, in voting in support of something that will wipe out the motion to go into supply?


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


John George Diefenbaker: No, I am talking. Sit down.


John Whitney Pickersgill: Very willingly.


John George Diefenbaker: The Secretary of State got into his difficulties in January of 1958, and apparently it is again his suggestion that puts the Prime Minister in the most difficult position that any prime minister has ever been put, in the history of our country.


John Whitney Pickersgill: Read standing order 56.


John George Diefenbaker: Now they are trying to get back on the rails after they vote in favour of the subamendment. I certainly appreciate the fact that they realize and recognize the error of their ways; that they realize they should now use more fully the spirit of cooperative federalism; that they consult with the provinces before announcing or undertaking programs which fall to any extent within provincial jurisdiction.
We congratulate them on their conversion. Never since the days of Saul en route to Damascus have we seen a conversion to equal this which has befallen a political party.
This is really one of the most interesting situations that has ever developed. As I endeavoured to say when I rose, I did not intend to participate in this debate. The hon. member for Three Rivers (Mr. Balcer) seconded the amendment this morning and intended to speak , but the turn of events made necessary my placing before the house the situation. I am going to wait with interest these hon.
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Lack of Consultation with Provinces gentlemen opposite voting for the subamendment that strikes out every word after "that," because when every word after "that" is struck out there will be no motion to go into supply, and the result will be inevitable.
I am sure Your Honour will be taking advisement, for this indeed represents the greatest somersault in smartness that has ever been placed before the House of Commons on a motion. It has all the earmarks of having been fathered by the Secretary of State, but the paternity of the speech on the part of the Prime Minister today will be the subject of consideration for years. I am sure that never before has a leader of government in this country decided, on behalf of those associated with him, to accept a subamendment that in reality condemns the government for its failure, while deleting the words of condemnation. A motion of non-confidence requires no such words as "condemn," or "for its failure," or "neglect." It can be worded as generally as is this subamendment, and I see a fine predicament for the government in the hours ahead.


John Whitney Pickersgill: Read the standing orders.


John George Diefenbaker: Look at it as you will. By this decision they have delivered themselves into the position of the opposition.
Now, sir, concerning the general views expressed by the Prime Minister about maintaining confederation, and as to making our contribution to assure it shall be preserved, that is our purpose and aim. That is the determination of members in all parties in this country.
The Prime Minister used a quotation from 1865. He did not say who it was who made the statement in question, but I seem to recall that those words were the words of Macdonald. Similar words were spoken by Macdonald, and at the time of the civil war in the United States Canada was engaged in nation building. The determination was made that this part of North America should remain under the British crown, and the means to achieve this were the establishment of a federal system.
The American system would not work in Canada. Weaknesses had been found in that system. Wherever matters were not specifically allocated to the central government in Washington, they became matters of legislation within the exclusive jurisdiction of the states.
As a result of the discussions led by Macdonald, and with the co-operation of Cartier, George Brown and others who participated, a plan was arrived at whereby we would assure the maintenance and preservation of the rights of the French, both in their language and in their religion, and would assure to

Lack of Consultation with Provinces them, not only for that generation but for all generations, the preservation of these rights. Educational rights also were left exclusively within the jurisdiction of the provinces. That was the plan; that was the objective; and I remember so well hearing in 1945 or 1946, when the then prime minister, Mr. St. Laurent said that those rights could be taken away by a simple vote of parliament. That was not then, is not now, nor ever was the position of the Conservative party. Those rights are unchanged and unchangeable, and must remain so, so long as this nation remains.
I call it six o'clock.


Mr. Deputy Speaker:: Order. It being six o'clock I do now leave the chair.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 8 p.m.
John George Diefenbaker: Mr. Speaker, just before the recess I was dealing with the unusual situation created by the Prime Minister's announcement that the government was going to support the subamendment moved by the leader of the New Democratic party. I would point out immediately that the leader of that party did not say that his subamendment was not one of non-confidence.


John Whitney Pickersgill: Oh, yes, he did.


John George Diefenbaker: Now we have the strange and unusual position of the Prime Minister rising and stating that he pleads guilty on behalf of the government to the failure of the government to exercise that degree of consultation that it ought to have exercised, but having pleaded guilty to the fact that there has not been enough consultation he then, as a defensive measure, contends that the government will do better from now on if it is given another chance.
That is a most unusual attitude. To find a somewhat similar situation one almost has to go back to 1958, when the Secretary of State was given the credit of having been the father of the amendment that was produced at that time. I would like to have dealt with the particulars of that amendment but the time limitation prevents it. The question before us is that of consultation and the need of carrying out the spirit of co-operative federalism; that the government should consult the provinces before announcing or undertaking programs which fall wholly or partly within provincial jurisdiction.
The Prime Minister advances a new variety of consultation. What he says in effect is that the government will decide what is to be


done, will put it into legislative form and will then start to implement the legislation it has brought in, without consultation. If, however, the provinces object, then the legislative program will stop and consultation will take place. If the experience of the past few months is to be any criterion for the future, we know that changes will be made in accordance with the strength of the pressure exerted by the various provinces. In other words the new type of consultation suggested by the Prime Minister will bring about in this country disorder, disunity and disagreement that would only weaken confederation. It is indeed a policy of confusion, creating a climate in which confederation will be torn asunder. We have only to consider the experience we have had in connection with the Canada pension plan, which was brought in here with trumpets blaring and is now being withdrawn, held in suspension, because the provinces asserted that they had the right to be consulted. This is not consultation within the concept of confederation. Consultation should take place before the program is proceeded with.


Some hon. Members:: Hear, hear.


John George Diefenbaker: Consultation after the event and after the federal government's decision can only bring about uncertainty, division and disunity. It will assure that a division exists between the federal government and the provinces that is the negation of the concept of confederation. The Prime Minister talks about abandoning joint programs. While he speaks of that, the President of the Privy Council (Mr. Lamontagne) makes a speech outside the house. At the very time this is going on the government has plunged into areas of provincial jurisdiction under the municipal loans program. Then there is the question of the designated areas. First the government designates areas and, having designated them, when there is objection to them there is to be consultation thereafter.
The proposition advanced by the Prime Minister today is one that can only undermine confederation. He expressed himself as though he were Horatius at the bridge, standing as the guardian of the constitution and against the possible disintegration of confederation. Yet in the last few months, as a result of the failure of this government to carry out the principles of consultation as they ought to be carried out, more and more uncertainty has developed and there is more cleavage as between province and province, people and people and area and area than ever before in this country.

I need only read a quotation from the Montreal Star of November 7 in this connection to illustrate my point. I need quote only one small portion of it:
Left on the shelf.
Mr. Pearson must have the taste of ashes in his mouth. Also he must be cursing the bush-league flack who foisted that "Sixty days of decision" catch-phrase on him. He has had to announce the postponement until a new session, early next year of several pieces of major legislation promised in the speech from the throne last May.
Then it says this:
The explanation that the portable pension plan is being shelved because it would be "inappropriate" to go ahead with it before the federal-provincial conference later this month falls some way short of conviction. Why has the "inappropriateness" only now been discovered? Or is the government having second thoughts about the pension machinery-as it had earlier about its budget?
What has happened in consequence of this haphazard, uncertain procedure on the part of the federal government is that now when any legislation is introduced without consultation pressure groups in the various parts of the country, provincial pressure groups, commence to operate. The result is that whatever legislation is brought in is not in keeping with the demands of the people but rather because of the necessity of placating the provinces because of the failure of the federal government to do that which is essential to confederation, namely to co-operate and at the same time to discuss, consider and view it from the point of view of both provincial and federal governments when matters come within the jurisdiction of both.
Now, sir, an example of that is the royal commission set up on biculturalism. I wish I could discuss that this evening. I hope it succeeds. I would point out the warning I gave on February 4 last in this house when I said that if it were set up it would not solve anything. What do we find? We asked for a dominion-provincial conference on the question of amending the constitution and bringing the constitution back to Canada for the settling of disputes between the provinces and the dominion, as well as providing for those symbols of our unity that must be established if full nationhood is to be achieved.
They set up a royal commission. It is just like the cave of Adullam. Many of those who are appearing before the royal commission are separatists who have ideas that are not in keeping with our constitutional development. The result is we are going to have a hodge-podge of representations which have little relationship to the need of Canada. When the commission completes its work in one, two or three years from now, there will be no finality. Then a dominion-provincial conference will have to be called and the whole matter gone over again.
28902-5-2974
Lack of Consultation with Provinces
Before I conclude sir, I want to refer to the subamendment. So far as the subamendment is concerned, we take objection to it because it alters our amendment. We believe that our own amendment quite adequately describes the actions of the government. We do not want our amendment amended in any way. Therefore, in so far as the subamendment is concerned we shall vote against it since it does interfere with the amendment we have moved.
However, if the subamendment should pass, and there is every possibility of that, Mr. Speaker, with the support the Prime Minister (Mr. Pearson) has given-


John Whitney Pickersgill: May I ask a question?


Some hon. Members:: Sit down.


John Whitney Pickersgill: Howled down again.


Jay Waldo Monteith: Look at the clock.


John George Diefenbaker: Mr. Speaker, the hon. member speaks of being howled down, but he is trying to prevent me from explaining, in the minute I have, the vote we are about to cast. This is an old game on the part of the hon. gentleman. If the subamendment should pass, we will view it, as we have said, as a vote of non-confidence, in that it clearly suggests that the government has not done enough in the field of federal-provincial relations. Whether or not the government pleads guilty to the charge, the full charge or only half the charge, they still will be pleading guilty by voting for the subamendment. Therefore, though the strong wording of our amendment may be watered down by the subamendment, we will then support the amendment as amended. We will vote for the main amendment, whether it is in its original form or in its amended form. I say to hon. gentlemen opposite, in that move today they were playing games. These games were not in keeping with parliamentary procedure. I hope that this evening the house will speak on the question of non-confidence, early and definitely.


Mr. Speaker:: Order; it being 8.15 o'clock p.m. it is my duty, pursuant to a special order made on Friday, November 1, 1963, to interrupt these proceedings and put forthwith the question on any amendment or amendment to the amendment now before the house.


Mr. Speaker:: I declare the amendment to the amendment carried.


Mr. Skoreyko:: Mr. Speaker, I was paired with the hon. member for St. John's West (Mr. Cashin). Had I voted I would have voted against the subamendment.


Walter Lockhart Gordon: Mr. Speaker, I was paired. Had I voted 1 would have voted for the subamendment.


Mr. Davis:: Mr. Speaker, I was paired. Had I voted I would have voted for the subamendment.


Mr. Rynard:: Mr. Speaker, I was paired with the hon. member for Brantford (Mr. Brown). Had I voted I would have voted against the subamendment.


Mr. Paul:: Mr. Speaker, I was paired with the Associate Minister of National Defence (Mr. Cardin). Had I voted, I would have voted against the subamendment.


Mr. Speaker:: The question is on the amendment as amended to the main motion.


Mr. Speaker:: I declare the amendment as amended carried.


Some hon. Members:: Resign.


J.-H.-Théogène Ricard: Mr. Speaker-*


Mr. Speaker:: The Secretary of State.


John Whitney Pickersgill: Mr. Speaker, pursuant to section 4(e) of standing order 56 I move, seconded by Mr. Gordon, that Mr. Speaker do now leave the chair.


Mr. G. H. Aiken (Parry Sound-Muskoka):: On a point of order-


J.-H.-Théogène Ricard: Mr. Speaker-


Mr. Speaker:: Order, please. I had recognized the house leader, the Secretary of State.


John George Diefenbaker: This is all very well, but we have a right to rise on a point of order, and have a right to challenge your ruling.


William Skoreyko: Mr. Speaker, I was paired, and had no opportunity-


Gordon Harvey Aiken: Mr. Speaker, I have a motion that the hon. member for St. Hyacinthe-Bagot (Mr. Ricard) be now heard.


Lionel Chevrier: There is a motion before the house now.


Mr. Speaker:: When the Speaker is faced with two motions he must, it seems to me, accept the first one. I had recognized the Secretary of State.


Mr. Woolliams:: That is nonsense.


Mr. Speaker:: And the motion is: pursuant to section 4(e) of standing order 56; Mr. Pickersgill moves, seconded by Mr. Gordon, that Mr. Speaker do now leave the chair.


Thomas Clement (Tommy) Douglas: I rise to register a grievance-


Mr. Speaker:: The hon. member for Bur-naby-Coquitlam.


Thomas Clement (Tommy) Douglas: My grievance, Mr. Speaker, is the appalling rise-


Gordon Harvey Aiken: On a point of order, there is no grievance at this time. We are speaking on a substantive motion by the Secretary of State.


Mr. Speaker:: The motion before the house is that the Speaker do now leave the chair in virtue of standing order 56 (4) (e). Is there a point of order against that?


Gordon Harvey Aiken: My point of order is that we are now speaking on a further substantive motion moved by the Secretary of State, and it is not

Point of Order
a grievance period at all. We are now speaking on the motion as it was heard this morning, and it is strictly within the rules. My proposal, Mr. Speaker, is that the official opposition ought to be the first party to be heard in speaking in reply to the substantive motion that the Secretary of State has moved. That is the reason I have moved that the hon. member for St. Hyacinthe-Bagot be now heard.


John Whitney Pickersgill: On the point of order raised by the hon. member for Parry Sound-Muskoka (Mr. Aiken), if I apprehend him correctly he is not taking any exception whatever to the motion I have made. He is simply asserting, or seeking to assert the right of a member of the official opposition to mention the first grievance, rather than a member of any other group.


Some hon. Members:: No, no.


John Whitney Pickersgill: I am speaking on the point of order, which I did not clearly understand. If the hon. gentleman is seeking to call into question the motion I made, I would draw Your Honour's attention to the standing order which seems to have escaped the attention of distinguished members of the house earlier today, and that particular standing order, No. 56(4)(e) reads:
When a motion "That Mr. Speaker do now leave the chair" is superseded by the adoption of an amendment at any time before the expiry of either the said two days or the time carried forward from a former debate, as the case may be, a like motion may be forthwith made by a minister of the crown. In the event of any such motion being proposed, the proceedings thereon shall be deemed to be an extension of the debate concluded by the adoption of the said amendment; provided that the second motion shall not be subject to amendment if it is proposed after the time specified in section (4) (d) of this standing order.
That is to say, the time of the taking of the vote. So I contend that under the standing orders which I recited in making my motion, my motion is completely in order. I could cite in support of that contention very distinguished authorities who sat in this house, a former leader of the opposition-


Some hon. Members:: Oh, oh.


John Whitney Pickersgill: -followed by the present Leader of the Opposition (Mr. Diefenbaker), who in 1951 moved an amendment to a motion made by the Hon. Alphonse Fournier that the house go into committee of supply. Mr. Drew moved a motion in amendment thereto.


John George Diefenbaker: What was Mr. Drew's amendment?


John Whitney Pickersgill: Mr. Drew's amendment was that the house was of the opinion that appropriate steps should be taken-he struck out the usual words.


John George Diefenbaker: Just read it, not striking out anything.


John Whitney Pickersgill: Mr. Speaker, the right hon. gentleman, who sets himself up as a model of courtesy in this house, would not allow me on two occasions this afternoon to ask him simple questions, and I would prefer this evening not to be interrupted by the right hon. gentleman.


Some hon. Members:: Hear, hear.


John Whitney Pickersgill: I shall, however, read the whole motion:
That all the words after "that" to the end of the question be deleted and the following substituted therefor:
"This house is of the opinion that appropriate steps should be taken for the appointment of a select committee to consider with Mr. Speaker the procedure of this house for the purpose of making recommendations designed to assure the more expeditious dispatch of public business and to suggest any changes that may be desirable."
Mr. St. Laurent, who had a very large majority supporting him at that time, as the right hon. gentleman will recall, accepted that motion made by Mr. Drew which superseded the motion that the house go into committee of supply. It was accepted by the house. Immediately Mr. Alphonse Fournier moved the motion that I have just moved, and it was also accepted by the house.
Then in 1952 another distinguished associate of the right hon. gentleman, Mr. Donald Fleming-


Some hon. Members:: Oh, oh.


John Whitney Pickersgill: -also moved a motion deleting the motion that the Speaker leave the chair, which motion was seconded by Mr. Fulton. Mr. Fleming moved this amendment to the motion:
That all the words after "That" to the end of the question be deleted and the following substituted therefor:
"in view of the impending departure of the Prime Minister for Washington this house desires to record its opinion that further vigorous efforts should be made by the government to bring about the removal of the restrictions imposed by the United States on the importation of Canadian agricultural products, in violation of the general agreement on tariffs and trade.
That motion was also accepted by Mr. St. Laurent and was adopted by the house. In the same procedure as I have followed on this occasion, Mr. Fournier moved that the house resolve itself into committee of supply, which motion was accepted by the Chair, uncontested by any point of order, and adopted in due course. There are a great many other

precedents going back to 1898 which could be cited, but it seems to me I should not take up the time of the house in citing them.
There is also, of course, the authority of Bourinot, who is the leading Canadian authority on parliamentary procedure, at page 424, which says:
An amendment moved to the motion to go into committee of supply (or ways and means) does not necessarily involve want of confidence in the administration. When such an amendment simply affirms-
As I maintain is the case here, and as my right hon. friend the Prime Minister maintained earlier today:
-a general principle, or sets forth a public grievance, and does not directly or impliedly challenge the conduct or policy of the government, it is not, in a parliamentary sense, a motion of want of confidence, and consequently cases often occur of the government agreeing to the passage of such motions.
That is precisely what happened in 1951, what happened in 1952 and what happened today.


John George Diefenbaker: It is not what happened today.


John Whitney Pickersgill: The right hon. gentleman was substituting one word for another and straining the normal meaning of words in reading into the motion of the hon. member for Burnaby-Coquitlam things that were not there. What the hon. member did was to urge the government to carry out more fully, thereby admitting that it was carrying out a certain policy-


Some hon. Members:: Oh, oh.


John Whitney Pickersgill: The hon. member said, to carry out more fully the spirit of co-operative federalism, and the whole tenor of the hon. gentleman's admirable speech today was precisely in that sense.


William Heward Grafftey: Shame.


John Whitney Pickersgill: The hon. member's motion was to carry out more fully the spirit of co-operative federalism and to consult with the provinces before announcing or undertaking programs, and so on. My right hon. friend the Prime Minister, in an exchange with the hon. gentleman, established beyond peradventure the meaning of these words, and there was no doubt whatever that all the hon. gentleman was asking the government to do was to go on doing things that the government was doing, that the government intended to do and which we would have been quite hypocritical in pretending we were opposed to doing. Therefore we have acted in this matter according to the precedents, according to the standing order and according to the rules of the house.
Point of Order


An hon. Member:: And according to the deal.


John George Diefenbaker: Mr. Speaker, methinks he doth protest too much. As a matter of fact there is no case since 1890, and we have read them all, in which such an amendment was not considered as a vote of non-confidence.


John Whitney Pickersgill: I just cited two.


John George Diefenbaker: The particular amendments were amendments in no way of nonconfidence. This subamendment was one of non-confidence, and this is simply a subterfuge explanation to get around the difficult position in which the government now finds itself, as can be seen by the reddened faces that characterize each and every member of the government.


Some hon. Members:: Hear, hear.


Some hon. Members:: Resign.


Mr. Speaker:: I can say with feeling that the situation is an interesting one but it seems to me it is not as difficult as some hon. members might make out. I hope I am right in this. The Secretary of State moved that pursuant to standing order 56 (4) (e)-which motion was seconded by Mr. Gordon-Mr. Speaker do now leave the chair. The Secretary of State did that by virtue of standing order 56 (4) (e). The motion is non-debatable in so far as that is concerned. So that in my opinion we now have a grievance period.
Then two hon. members rose. I recognized the hon. member for Burnaby-Coquitlam (Mr. Douglas). Then the hon. member for Parry Sound-Muskoka (Mr. Aiken), rising on a point of order, moved that the hon. member for St. Hyacinthe-Bagot (Mr. Ricard) be now heard. The hon. member did this by virtue of standing order 29. It is his right to do this, because standing order 29 says:
When two or more members rise to speak, Mr. Speaker calls upon the member who first rose In his place; but a motion may be made that any member who has risen ''be now heard", or "do now speak", which motion shall be forthwith put without debate.
It seems to me that we are now in the grievance period and that the dispute is between the hon. member for St. Hyacinthe-Bagot and the hon. member for Burnaby-Coquitlam. I now have this motion before me and it is up to the house to decide whom it shall hear.


Gordon Harvey Aiken: Mr. Speaker, on a matter of clarifying the procedure, do I understand that while the Secretary of State (Mr. Pickersgill) and the hon. member for St. Hyacinthe-Bagot (Mr. Ricard) were both on their feet and I moved my motion, Your Honour had then recognized the Secretary of State and his motion?

Point of Order


Mr. Speaker:: I recognized the Secretary of State first, and as a matter of fact I was at least three quarters of the way through reading his motion when I saw that the hon. member for Parry Sound-Muskoka (Mr. Aiken) was also on his feet.


J.-H.-Théogène Ricard: Mr. Speaker, on a question of privilege, earlier-


Mr. Caron:: There is no debate on the question.


Mr. Speaker:: The question, surely, is which of the two hon. members shall now speak. There is a motion before the house moved by the hon. member for Parry Sound-Muskoka and seconded by the hon. member for Grey-Bruce (Mr. Winkler) that the hon. member for St. Hyacinthe-Bagot be now heard. This motion is by virtue of standing order 29.


An hon. Member:: And is not debatable.


Mr. Speaker:: All I can do in the circumstances is ask the house to decide which hon. member shall now be heard.


Gordon Harvey Aiken: Mr. Speaker, my motion was directed towards the earlier dispute between the Secretary of State (Mr. Pickersgill) and the hon. member for St. Hyacinthe-Bagot (Mr. Ricard). If Your Honour has ruled that you did hear the hon. Secretary of State, then, with the unanimous consent of the house, I herewith withdraw my motion.


Mr. Speaker:: I have so ruled, and I think correctly. Do I understand the hon. member is withdrawing his motion as to priority on behalf of the hon. member for St. Hyacinthe-Bagot?


Gordon Harvey Aiken: Yes.


Mr. Speaker:: Then, in that case, there is only the hon. member for Burnaby-Coquitlam (Mr. Douglas) left.


J.-H.-Théogène Ricard: Earlier today, Mr. Speaker, you were informed that I was to take the grievance period tonight. I was given to understand that I would be the first one to speak here, and by being deprived of my right to speak tonight, I want to place before the house the fact that this is another kind of closure about which the country should know.


Stanley Howard Knowles: I regret having to speak on this question of privilege, but I should like to clear up a point. I indicated to Your Honour a week ago tonight that the hon. member for Burnaby-Coquitlam would be speaking at this point tonight since there was no opportunity for him to speak at that time. I gave notice on behalf of the hon. member, not this afternoon but seven days ago and I confirmed it today.


John George Diefenbaker: No one wants to hold up
proceedings, but I should like to know to whom the notice was given and by whom it was given.


Stanley Howard Knowles: I gave it to Mr. Speaker,
myself.


Some hon. Members:: Oh, oh.


Thomas Clement (Tommy) Douglas: Mr. Speaker-


Mr. Speaker:: Order; I believe a short explanation is in order. It is quite true the hon. member for St. Hyacinthe-Bagot spoke to me some time today. I said at the time that, so far, no one else had mentioned the matter to me. Subsequently, the hon. member for Winnipeg North Centre approached and said, "You recall I spoke to you on behalf of the hon. member for Burnaby-Coquitlam some time ago." Two or three weeks ago, I mentioned that it was very difficult to give reservations on the right to speak, and that reservations should not be given. I immediately communicated with the whip for the official opposition, and suggested that the two parties get together to try to regulate the matter. At six o'clock I did the same thing. When there is a dispute such as this it seems to me the way to solve it is by the use of standing order 29.


Gilles Grégoire: May I make a suggestion on that point, Mr. Speaker? On the previous occasions the Conservatives had the opportunity of rising first on these grievances. Two weeks ago, an hon. member for the New Democratic party had an opportunity to raise a grievance. Since the Social Credit members from this group have had no opportunity at all, I suggest that perhaps one of the members from this group should raise a grievance.


Mr. Winkler:: Speaking to the point of order, Mr. Speaker, may I say that it seems to me it might be wise to have a member of the Conservative party recognized this evening, because it seems to be the only legitimate opposition that is left in the house.


Some hon. Members:: Hear, hear.


Thomas Clement (Tommy) Douglas: I endeavoured to raise this question of grievance-


William Skoreyko: I rise on a question of privilege, Mr. Speaker. I was paired with the hon. member for St. John's West (Mr. Cashin) because I understand there is serious illness in his family. I only want to inform the house this is the reason I am on my feet now, and had I voted I would have voted for the amendment.


Philip Bernard Rynard: Mr. Speaker, I was paired with the hon. member for Brantford (Mr. Brown). Had I voted, I would have voted for the amendment.



ALLEGED FAILURE OF GOVERNMENT TO CONTROL PRICE INCREASE

Thomas Clement (Tommy) Douglas: At long last, Mr. Speaker, I am to have the opportunity of registering a grievance.


J.-H.-Théogène Ricard: At my expense.


Thomas Clement (Tommy) Douglas: I hoped to do so a week ago tonight, but the other grievance that was raised took all the time until ten o'clock. The grievance I wish to raise is the appalling increase in the price of sugar, and the fact that the government has taken no effective action to deal with the situation. There are indications that fantastic profits have been made out of the increase in the price of sugar, and so far the government has done nothing except to take refuge in their lack of constitutional authority.
The facts in connection with the price of sugar are known to every housewife in Canada. In the past 12 months the price of sugar to the consumer has doubled. There have been more than 90 changes in sugar prices in the past year. At the moment the price of sugar in Canada is at its highest peak since 1920, an all-time record for 43 years. This increased price of sugar has reached into the pocketbook of every housewife in Canada. It not only affects the sugar which the consumer buys for use in his own home, but it enters into the cost of processed foods, of fruit preserving, jams, jellies, soft drinks and a great many commodities. In every case, the burden of this increase in price falls on only one person: It falls upon the Canadian housewife.
We have endeavoured to raise this matter repeatedly ever since parliament reassembled. My friend, the hon. member for New Westminster (Mr. Mather), raised this almost as soon as the house met on September 30. A week ago last Friday my colleague, the hon. member for Burnaby-Rich-mond (Mr. Prittie) sought to adjourn the house to discuss a matter of urgent public importance, namely the rising price of sugar. Frequently on orders of the day we have raised this question. The only answer we have been able to get from the government is that the rising cost of sugar in Canada is due to the rise in world prices.
I think we ought to take a look at this argument. We should recognize, first of all, that the figures given to us by the Minister of Trade and Commerce (Mr. Sharp) this spring indicated there was no sugar shortage in Canada. If I recall correctly, he said that there were over 400 million pounds of sugar in Canada, which was slightly higher than the stockpile of sugar in Canada in April of the previous year. I am told that there is
Sugar Price Control
no shortage of sugar in Canada today, and that the stockpiles in Canada now are as high or higher than they were 12 months ago. The world price, therefore, had nothing to do with the sugar stockpiled in Canada and which had already been purchased.
If the sugar companies made, in addition to their regular profits, another five cents a pound-I think that is a very low estimate- it means that they pilfered another $20 million out of the purses of the housewives of Canada. A very fat profit has been made by somebody out of this very rapid increase in the price of sugar. The other fact which has to be kept in mind is that about 20 per cent of the sugar we consume in Canada is made from sugar beets produced in Canada, and certainly that part of the sugar supply is not affected by the world price.
Therefore, what do we find? We find that the sugar companies in Canada have been able to increase the price of beet sugar and have treated the price of beet sugar as though it were the price of imported sugar. The people buying sugar on the prairies close to the refineries in Winnipeg and Lethbridge have thus found that their sugar prices have gone up, even though that sugar is produced on the prairies. It is rather interesting to see that in the Chicago market beet sugar has been selling for $9.50 to $11.25, whereas beet sugar in Canada has been selling for $17.50 a hundred. One of the things which has disturbed a great many Canadians is that, while prices in Canada have risen to astronomical heights the price of sugar in the United States does not seem to have been affected by the rapid rise in the world price. For instance, in the northeastern states of the United States sugar is now selling for $13.45 to $13.55 a hundred pounds. At the same time a hundred pounds of cane sugar in the city of Montreal costs $18.65, in the city of Vancouver $16.60, and in the city of Toronto $18.55. It is very difficult, Mr. Speaker, to explain to the Canadian housewife in the city of Toronto why she should pay 97 cents today for a five-pound bag of sugar when United States newspapers carry advertisements, some of which I have here, advertising cane sugar for 49 cents for a five-pound bag. It is 97 cents in the city of Toronto; 49 cents for the same bag of sugar in the United States. This means that the Canadian housewife is paying almost twice as much as the housewife in the United States.
I think there are indications, Mr. Speaker, that there has been a great deal of profiteering by the sugar companies of Canada. I think they have taken advantage of the decline in the world sugar supply. I think they have made fabulous profits out of the large stocks of

Sugar Price Control
sugar that were in Canada long before the world price rose. The fact is that there is no sugar shortage in the world. It is true that the world surplus has been reduced but there is no shortage of sugar A statement has been issued by Mr. Arthur E. Beeby, executive vice president of Salada Foods Limited, and part of his statement is as follows:
The recent series of increases in sugar prices cannot be explained on the basis of supply and demand. There is no world sugar shortage. At the start of this year, there was a large surplus. At the end of this year, there will still be a surplus although a reduced one....
Reliable estimates for this year indicate that a 12-million ton carryover at the beginning of the 1962-63 season will be cut to 9 to 9.5 million tons by year-end. This certainly does not suggest a sugar glut but neither does it represent shortage_
Cane or beets for sugar are grown in more than seventy countries. It is obvious that orderly marketing of the resulting multi-million ton annual crops in the form of raw sugar calls for the buying and selling facilities of recognized commodity exchanges including future markets. The volume of future trading has been skyrocketing. On the London market, the 1963 volume was recently reported as $11.4 million. For the same period of last year, it was less than one quarter of this total, suggesting that the explanation of price pyrotechnics in sugar is to be found in this market performance.
As a major Canadian buyer of refined sugar, we are forced to the conclusion that the rising costs of this staple food item on world markets do not result from demand but from speculation.
I think, Mr. Speaker, those facts speak for themselves. We started the year with a surplus in the world of some 12 million tons of sugar. We shall probably finish this year with anywhere from between 9 and 9J million tons of sugar in the world. The surplus has been reduced but there is no shortage of sugar. The increase in the price of sugar has been due to speculation, due in part to a rumour that the U.S.S.R. might import large quantities of sugar this year. This has given rise to speculation in the sugar market. But the tragedy is that the Canadian housewife has been the victim of this speculation. She has had no protection whatsoever from this government. The best the Minister of Justice (Mr. Chevrier) was able to do was to tell the house that someone in the restrictive trade practices branch had telephoned Mr. Beeby and that Mr. Beeby was not claiming that there was any price fixing or anything improper going on.


Lionel Chevrier: He denied a portion of the statement you have just made.


Thomas Clement (Tommy) Douglas: Well, he cannot deny this statement because it is a printed statement sent out by Salada Foods Limited. I am not quoting from a newspaper report.


Lionel Chevrier: That is exactly what he denied.


Thomas Clement (Tommy) Douglas: I am quoting from the printed statement which was sent out by Mr. Beeby's own company to thousands of people across Canada. I imagine that every member of parliament got a copy of this, as I did.


Lionel Chevrier: May I ask the hon. gentleman a question. Was he in the house the other day when I put on Hansard the statement which was given by Mr. Beeby in connection with what the hon. gentleman has just read?


Thomas Clement (Tommy) Douglas: I certainly was.


Lionel Chevrier: He stated quite clearly that in his opinion his statement did not disclose any breach of the Combines Investigation Act.


Thomas Clement (Tommy) Douglas: Exactly. I was in the house when the minister made the statement and 1 was amazed that the minister made it. I was amazed at the minister having his officials telephone a man, a private citizen, to ask him to establish whether or not the Combines Investigation Act had been violated. That is the responsibility of the minister and his officials, not the responsibility of private citizens. That is exactly what this government has done. It has sat on the Combines Investigation Act and said to the Canadian people: "If you can prove there is something wrong we will do something about it". I am saying that it is the responsibility of this government to find out whether there is something wrong, and it is for them to do something about it.
What can the government do? The minister has made us one promise only. The restrictive trade practices branch will, he said, keep the matter under careful scrutiny and will take action under the combines investigation legislation if there is evidence of price fixing and collusion. Well, we expected it to do that. But I would point out, first of all, that this is too slow a process to do anything about the exploitation of the Canadian housewife. The investigation by his department and any legal action which might follow would take months, and probably years.
Even if the branch were successful in getting a conviction, this would not punish the sugar companies. Every hon. member knows the record of the sugar companies. The restrictive trade practices branch and the Department of Justice brought three of the largest sugar companies of Canada into court-the Atlantic Sugar Refineries Company, now called the Acadia-Atlantic Sugar Refineries Limited, the Canada and Dominion Sugar Company Limited and the St. Lawrence Sugar Refineries Limited. These three companies were brought into court and last January they pleaded guilty to a charge of making an illegal profit on 80,000 tons of sugar. In March they were fined $25,000 each or a total of $75,000. So there was a total fine of $75,000 on 80,000 tons of sugar which amounts to a

fine of less than $1 a ton-a fine of less than one twentieth of a cent a pound. I say to you now, Mr. Speaker, and to the house, that these companies did not pay a fine; they paid a licence to commit piracy on the housewives of Canada. Do not let the minister tell us that the combines investigation legislation is going to protect the housewife.
There are things which the government could have done. First, there is the matter of price control. The Minister of Justice says this is a provincial matter. I want the government to tell this house whether it has ever consulted the representatives of the provinces in order to find out whether the provinces would be prepared to agree to emergency legislation for price controls on sugar. Has the government ever asked the provinces whether they are prepared to delegate to the federal government authority to legislate in this field on a temporary basis or an emergency basis? After all, the provinces are also much concerned about the price of sugar. They each have authority to legislate concerning the price of sugar. The federal government has to give some leadership. What leadership have they given? Have they ever called the provinces together and said to them: You must be concerned, as we are, about the rising price of sugar. Are you prepared to delegate authority to us, or to act in concert so as to pass uniform legislation to control this situation?
There is another thing which the government could do. It could do what other countries are doing and go into the bulk purchasing of sugar. If necessary, after consulting with the provinces, the government could declare sugar refineries and sugar distribution facilities to be works for the general advantage of Canada. It could set up a sugar control board. It could sign the commonwealth sugar agreement under which countries in the commonwealth buy sugar in quantities under agreements extending over a period of time. This is why the people of Great Britain are getting cheaper sugar. This is why the American housewife is getting cheaper sugar. Here in Canada we are selling wheat under long term agreements. One of the reasons we are able to do so is because other countries buy our wheat knowing they can do so at an agreed price. There is nothing to prevent our buying sugar at an agreed price. At the present time many members of the commonwealth have signed the sugar agreement and are buying large quantities of sugar at agreed prices spread over a period of years. This would protect us from speculation in world sugar markets.
Has the government made any move to take action along these lines or to investigate the possibilities of such action? I say to the
Sugar Price Control
government: It is not too late now to look into the possibility of the bulk purchase of sugar and the setting up of a sugar control board. I say to the government: please do not take refuge again behind the lack of constitutional authority, because I am sure there is not a provincial government in Canada which would not co-operate with the present federal administration if it were prepared to do something immediately about stopping this profiteering in sugar. The provinces are just as concerned as we should be, because it is their citizens who are being exploited. They, too, are hearing the complaints of Canadian housewives. All they need is someone to give them a lead to attack this problem. Action in this matter has been delayed too long and I accuse the government of dilatoriness, of negligence and of dereliction of duty in failing to tackle it. I say the time has come when the government should cease sitting on its dignity and begin stepping on those who have been profiteering at the expense of the people of Canada.
I say to the government: the time has come to stop wringing your hands and to start ringing the changes on those who have been pilfering from the pockets of the Canadian people. I say to the government: If you continue to do nothing, the people of Canada will recognize that you lack the courage to face up to a critical situation. I say that if you do something, and do it promptly, you will earn the gratitude of the housewives of Canada.


Mitchell William Sharp: Mr. Speaker, I should like to make some comments on the speech which has been made by the hon. member for Burnaby-Coquitlam (Mr. Douglas). I should like to deal at the outset with three questions he has raised, perhaps to set some of the facts straight, and then I should like to say a word about government policy.
First of all, why have sugar prices risen? Second, why are sugar prices in eastern Canada higher than they are in western Canada? Third, why are they higher in Canada than they are in the United States or in Britain? The answer to the first question is relatively simple. There has been a profound change in the world sugar market in the last couple of years. I might refer to the Cuban situation in this regard. In 1961, Cuba had an export surplus of more than 6 million tons. Last year it had declined to 5 million tons. This year, as a result of hurricane Flora, it is down to 3 million tons. Throughout eastern Europe sugar beet harvests have been very low indeed. These are the facts about the change in the world sugar situation.
The hon. member quoted some statistics in which he suggested there were great stocks

Sugar Price Control
of sugar available in the world to meet this temporary shortage. Perhaps the best answer to that is to quote from a press release issued the other day after the sixteenth session of the international sugar council:
The council considered this estimate against the first forecast of supplies available for world destinations in 1964 and concluded that taking the year as a whole it would appear that requirements would again be considerably in excess of supplies. Thus the council envisaged a continuance in 1964 of the present tight supply-demand situation.
There are no large stocks of sugar in the world. If there were, we should not be faced with the situation which arises today.


Mr. Langlois:: Would the minister permit a question?


Mitchell William Sharp: I should like to finish this before ten o'clock if I may be permitted to do so because there are one or two things I should like to say at the end about the policy of the government which I think hon. gentlemen would like to hear.


Raymond Langlois: I think the minister will still have time to finish.


Lionel Chevrier: There are others who may wish to speak in the debate. Go ahead.


Mitchell William Sharp: World sugar prices have recorded these fundamental changes and they have been very fundamental. On the London market, which is recognized as a world market, raw sugar prices were the equivalent of around 3 cents a pound about a year ago. As a matter of fact, for some years sugar prices have been drifting along at about the 3 cent level, as I have reason to know because I participated in some of the efforts to stabilize the world sugar market to prevent its collapse. This was a time when there were monumental supplies of sugar overhanging the world market, but these have tended to disappear recently.
Last May, when we had the first upward thrust in prices and the first decline in supplies, prices reached a peak of between 12 and 13 cents in London and then declined. As hon. members will recall, there was a very sharp reversal of the sugar market and prices came down, until in August they had dropped to between 5 and 6 cents. Then, after hurricane Flora they soared again to the peaks of last May where they are today.
I think hon. members will see that the proportionate rise in world prices of sugar is parallel to that of sugar prices in Canada. Indeed, the hon. gentleman quoted some sugar prices in Canada. I happened to be doing some shopping for my wife last Saturday and I made a special visit to the sugar counter in the chain store. There I noticed the changes that had been taking place. A ten pound bag

of sugar was over $2 and I can recall a year ago when it was down around 80 cents.
There can be no question about the rise or about the fact these prices are very closely paralleled in world markets. In fact, Mr. Speaker, in Canada the price of sugar is directly related to the world sugar price as reflected in the London market, and we in this case buy raw cane sugar on the basis of the London price.
I should like now to come to the second question. Why should the price in eastern Canada be higher than the price in western Canada? According to my information there is a differential of something like $2 a hundredweight between Montreal and Vancouver. The reason for the differential is this. On the west coast the only refiner of cane sugar, B.C. Sugar Refining Company, bought the sugar it is now using some months ago when the price was lower, and it is now selling this at cost plus what it considers a reasonable profit. In other words, consumers in western Canada are getting the advantage of the lower prices that existed for sugar on the London market some time ago when B.C. Sugar Refining Company bought their sugar from Australia and Fiji. Eastern Canada refiners, on the other hand-


Thomas Clement (Tommy) Douglas: May I ask the minister where he gets his cheap price? In Winnipeg sugar is selling for $17.50 a hundred pounds which is $1 less than the price at Toronto and Montreal.


Mitchell William Sharp: Sugar Price Control
rate, and to a British preferential tariff of 28 cents per cwt. The preference of $1 per cwt. is a contractual obligation to the British West Indies and other commonwealth countries.
Commonwealth exporters attach a very high value to their preferential position in our sugar market, and from our point of view it is the means by which we are assured adequate supplies to meet our requirements at all times. It would be open to us to suspend the British preferential rate of 28 cents, but that would simply amount to a reduction of a quarter to one third of a cent a pound, and would be comparatively meaningless in the present situation.
Another alternative is to pay a subsidy to consumers of sugar. We have looked at this proposition, and if we were to pay a subsidy of 5 cents a pound this would cost about $85 million annually. It will be evident that expenditures of this order must be appraised in relation to other pressing demands on the government and in terms of a realistic order of priorities and objectives. In other words, these two proposals, to remove the duty or to pay a subsidy, do not change the price of sugar to Canadians as a whole. They simply redistribute its costs.
The hon. gentleman spoke about price controls, and he knows, as well as I do, that we have no constitutional authority to impose price control. May I suggest to him in connection with his own suggestion, and to repeat again what I said, that I do not think I would be in favour of placing a price control upon sugar produced from beets in Canada alone. It seems to me if price controls were to be effective they would have to be effective on over-all prices, and this would be beyond our control. And if we put a price control on sugar in Canada, if we placed the price of sugar below world market prices we would not get supplies. I do not think this would be a feasible alternative, either, in connection with purchases of bulk sugar from abroad.
The government has been looking into the possibilities of a change in sugar policy of a more fundamental character. This is a problem of great complexity and is fraught with many uncertainties. It is clear from the experience of Britain and the United States that managed markets with respect to both imports and domestic production of sugar can lead to expensive commitments involving higher prices to consumers, and may in any event be inconsistent with our long term economic interests and our international trading relations.
Nevertheless, recent experience during this period of scarcity has not been satisfactory, particularly when we see sugar from Canada's

traditional suppliers being offered more cheaply to United States buyers than to Canadian buyers. I am sure hon. gentlemen will agree with me that, when we see sugar from commonwealth sources being pushed into the United States in order to establish a record for future import quotas, it is a little difficult for Canadians, who do not happen to have that sort of system to pay higher prices in consequence. The government is examining with an open mind the possibility of a change of policy.
The British and Canadian markets have constituted for many years the main outlets for commonwealth producers. A few years ago, in order to assist expansion of commonwealth production, Britain, through the commonwealth sugar agreement extended a guaranteed annual market at annually negotiated prices to the commonwealth producers. At the same time, in an article of the agreement, the commonwealth producers recorded their intent to give priority to the requirements of Canada through ordinary commercial channels, as I have described.
The commonwealth producers traditionally take advantage of the Canadian tariff preference margin in their sales to Canada by conceding about 15 cents out of the preferential dollar, taking the other 85 cents themselves, the 15 cents being for the purpose of ensuring that they get the business rather than some non-commonwealth suppliers. This margin of preference is sufficient to give them command over our market.
Commonwealth producers have begun to interest themselves in obtaining a significant share of the United States market, now that this market is open to all comers. For this purpose, commonwealth production is being expanded beyond consumption within the commonwealth preference area, and there are also new sources within the commonwealth, for example India, and these changing conditions may have an important bearing on a future Canadian policy on sugar.
As I indicated in my remarks to the house last May, the international sugar agreement does not provide the sort of protection to consumers I would like to see, and the government would like to see, and we are very much interested in examining a more effective form of agreement. We are also prepared to explore the future of Canada's relationship to commonwealth producers. We have been aware that similar thoughts have been in the minds of the commonwealth sugar exporters, from informal contacts made with them, and today we have received the following cablegram from the chairman of the commonwealth sugar exporters group:

Commonwealth sugar exporters now meeting in London are anxiously considering supply of commonwealth sugar to Canada and would welcome opportunity of discussing the practicability of offering annual quantities of commonwealth sugar to Canada for several years ahead at stable prices. We can assure you of adequate commonwealth supplies at all times to meet your requirements. Grateful you cable whether your government would welcome such broad proposals before the end of this year. Respects and regards.
We received another from Salisbury in Rhodesia:
Rhodesia sugar sales would welcome early opportunity of discussing with you possibility of long term agreement for supplying sugar to Canada with view to helping stabilize your internal price.
I intend to advise both the commonwealth exporters group and the Rhodesian producers that the Canadian government would be interested to consider with them any proposals they may wish to lay before us. So, in summing up, may I say there is no shortage of sugar in Canada. Stocks are higher than normal, imports are normal, and domestic production is rising. Prices in Canada have followed world market prices because they have been closely related to world market prices.
The government, however, is not satisfied the present arrangements give adequate protection for Canadian consumers, and will be discussing with commonwealth producers the possibility of long term contracts.


Thomas Clement (Tommy) Douglas: If the government were to accept the offer which is indicated by the cablegrams the minister read, to purchase quantities of sugar at agreed prices over a period of years, what machinery would the government set up to make sure that the savings made thereby would be passed on to the consumers?


Mitchell William Sharp: Mr. Speaker, I would hesitate to give a technical answer, but I think it is quite possible to work out arrangements that would give us the necessary protection. I know that refiners would be willing to cooperate, and the beet producers in Canada. Therefore I would not anticipate difficulties in ensuring the benefit of such an arrangement would be passed on to the consumers.


Herbert Wilfred Herridge: Would not the minister admit this is the normal workings of the capitalist system?


Raymond Langlois: Mr. Speaker, in accordance with the precedent that you have established this evening, I now give notice that I will have a grievance to raise on the next supply motion.


Mr. Speaker:: I thought I was very clear in saying that the reservation system which
Supply-Items Passed
seemed to have been in force is not in force at present and will not be followed.
It being ten o'clock, it is my duty, pursuant to special order passed on Friday, November 1, to put the question. Is it the pleasure of the house to adopt the motion?


Jay Waldo Monteith: On division.


[Stage Direction]
Motion agreed to, and the house went into committee, Mr. Lamoureux in the chair.
The estimates of the following departments were first taken up and entered for consideration.

[Stage Direction]
Id. Departmental administration, $665,000.

[Stage Direction]
1.	The Speaker of the Senate-Allowance in lieu of residence, $3,000.

[Stage Direction]
I.	Department administration-Administration, operation and maintenance including Canada's fee for membership in the pan-American institute of geography and history, $1,290,100.

[Stage Direction]
I.	Payment, notwithstanding anything in the Financial Administration Act or the Senate and House of Commons Act respecting the independence of parliament, to each member of the Queen's Privy Council for Canada who is a minister for whom no salary or allowance in addition to the allowances under section 33 and section 44 of the Senate and House of Commons Act is provided (the acceptance of which shall not render such member ineligible or disqualify him as a member of the House of Commons) of a salary of $7,500 per annum and pro rata for any period less than a year, $7,500.

[Stage Direction]
1.	Departmental administration, $317,600.
Proceedings reported.

Jay Waldo Monteith: Mr. Speaker, if the Prime Minister has not in the meantime visited the Governor General, I wonder if the house leader might outline the business for the remainder of the week?


John Whitney Pickersgill: I would be glad to indicate what business we will take for tomorrow, but I should like to have a word with the hon. gentleman, who I take it is acting for the hon. member for Winnipeg South Centre in his absence on public duties, and with other hon. gentlemen opposite before I agree about the rest of the week.
If I could just repeat what was said by my hon. friend, the Solicitor General, about tomorrow, we would take first the third reading of the income tax measure; then, we

Business of the House
would take the vocational training resolution and, if there was time, the resolution setting up a committee on the C.N.R. and the other transport agencies owned by the government. If these matters were concluded, I
would arrange with hon. gentlemen about having enough business to keep us going until six o'clock.


[Stage Direction]
It being five minutes aften ten o'clock the house adjourned, without question put.
[Stage Direction]
Wednesday, November 13, 1963