1963-08-01

Mr. Speaker:: May I be permitted to inform the house that the joint committee on the library met yesterday and 1 now have the honour to table its first report in both English and French.



MISCELLANEOUS PRIVATE BILLS


[Stage Direction]
Eighth report of standing committee on miscellaneous private bills-Mr. Wahn.
(Translation):


Mr. L. J. Pigeon (Jolielte-L'Assompiion-Monicalm):: Mr. Speaker, I rise on a question of privilege. I am referring to a question which was asked by the hon. member for Rosthern (Mr. Nasserden) and to the reply given by the Secretary of State (Mr. Pick-ersgill), which went as follows:
I am afraid I cannot add anything to the answer which was given to his alert colleague, the hon. member for Joliette-L'Assomption-Montcalm, who anticipated this question on June 28 and represented the hon. gentleman's constituents at that time.
Mr. Speaker, I should like to point out that even though I live in the riding of Joliette-L'Assomption-Montcalm, which is not the minister's case, it is my privilege to ask questions which do not necessarily concern the constituency I represent in Ottawa. As a member of the parliament of Canada, it is my right to ask questions concerning other parts of the country.
Furthermore, I have no orders to take from the hon. Fuehrer from Bonavista-Twillingate.



WITHDRAWAL OF QUESTIONS ON ORDER PAPER

Mr. Gilles Gregoire (Lapointe):: Mr. Speaker, I rise on a question of privilege which might not be one, but I should like to raise the matter just the same with the consent of the house.
During the question period yesterday afternoon, the Secretary of State (Mr. Pickersgill) called us together to inform us of the difficulties caused by a number of questions on bilingualism put on the order paper by the hon. members for Beauce, Quebec East, Compton-Frontenac, Dorchester and Roberval (Messrs. Perron, Beaule, Latulippe, Boutin and Gauthier).
There are several of those difficulties that we cannot admit, namely:
(a)	the definition of a bilingual person,
(b)	the criteria to be used to assess the bilingualism of such a person,
(c)	the length of such an inquiry,
(d)	ascertaining whether a business is French Canadian or not.
In addition, we feel that knowledge of the facts, of statistics and of the degree of participation of French Canadians in the affairs of the country is absolutely essential to the Laurendeau-Dunton royal commission if it is to conduct a worthwhile inquiry.
On the other hand, we understand and appreciate that the Secretary of State (Mr. Pickersgill) would like to dispose of all the questions on the order paper before the summer recess.
(Text):
Therefore, in view of the fact that the government has shown determination to settle the problems of bilingualism and biculturalism in our country, we will agree to the request of the Secretary of State to withdraw these questions from the order paper, under the condition that the government will ask the civil service commission to make an inquiry on this subject and transmit the results of this inquiry to the Dunton-Laurendeau commission and to ourselves.


Hon. J. W. Pickersgill (Secretary of State):: If I might be permitted to say a word, I should like to express appreciation to the hon. member and to other hon. members in whose names the questions are standing, and to give to them the assurance that I have communicated with the commission about this matter. The civil service commission is most anxious to provide all possible information of the character that was asked for in these questions to the royal commission. The government will do everything possible to facilitate the procedure along the lines the hon. gentleman
2880	HOUSE OF
Establishment of Shipping Trusteeship has suggested. Speaking tor the government, I am most appreciative of the attitude he has taken.


Mr. Speaker:: Will the Secretary of State indicate now if possible, or later perhaps, the numbers of the questions to which reference has been made?


John Whitney Pickersgill: I wonder if I might save the time of the house by indicating that tomorrow?


Some hon. Members:: Agreed.



LABOUR RELATIONS


Hon. A. J. MacEachen (Minister of Labour):: Mr. Speaker, I indicated yesterday that I should like to make a further statement about the report of Mr. Justice Norris on the disruption of shipping. Hon. members will have had the opportunity of reading the report and becoming familiar with its contents since its release just over two weeks ago on July 18. Hon. members will, I think, all agree with me that the commissioner delivered a comprehensive report following one oi tne most intensive inquiries ever made in Canada in a labour relations situation. The report gives an account of violence, corruption, lawlessness, mismanagement, misapplication of union funds and arbitrary control over the livelihood of seamen on the waters of the great lakes and the St. Lawrence seaway.
Both the inquiry itself and the report have clearly stirred public opinion, and from questions asked by hon. members it would appear that they have also been deeply shocked by the sordid and cynical situation which appears to exist in areas of the shipping industry on the joint waters uniting Canada and the United States. A strong desire has been expressed that resolute action be taken to control the situation, to cure it and to prevent it from corrupting other parts of the legitimate union movement.
An interdepartmental committee composed of deputy ministers and other senior officials of the departments most directly concerned was named, as announced earlier, on July 17. This committee has reviewed, under some pressure, the recommendations contained in the report and has made its observations on each of them. Based on these observations, on the endorsation of the major recommendation on the part of four of the five maritime unions directly involved, one of which endorsed the major recommendation only yesterday, and on the widespread public support for effective action to be taken to deal with the


situation revealed by the inquiry, the government has reached a decision that a trusteeship is advisable.
Consultations have been carried on with the Canadian Labour Congress about the course of action which might be followed. Both the government and the Canadian Labour Congress hold firmly to the view that a government sponsored trusteeship should not be introduced as a normal means of dealing with problems arising within or between unions, and that it is justified in this instance only due to the extraordinary circumstances prevailing with respect to Canadian shipping on the great lakes and the St. Lawrence seaway.
In view of the fact that all of its affiliates concerned have accepted the recommendation for a trusteeship, and on the understanding that a trusteeship would be of a temporary duration and that the legislation providing for it would contain other safeguards, including progressive removal of the trusteeship, the Canadian Labour Congress has now assured the government of its co-operation.
A start has been made on the preparation of the necessary legislation. As will be appreciated, this requires much care due to the conctituticncil aspect involved necessity for the legislation to be effective.
We had hoped it would have been possible to bring forward legislation before the recess. The only type of legislation that could have been prepared for immediate parliamentary action, due to the limited time available since the report was issued, would have been general enabling legislation empowering the government to take the necessary action under regulations approved by governor in council.
After careful reflection it has been decided not to propose this course. Instead a decision has been taken to press ahead with the preparation of detailed legislation that is within the power of parliament to enact, and which will be introduced for the immediate attention of the house on our return at the end of September.
The interval will enable us to proceed with our plans, including completion of the necessary work on the legislation. It is our intention to have further discussions with the United States authorities with a view to ensuring the maximum effectiveness of a trusteesship in removing the continuing harassment of Canadian ships on the great lakes. I would like to refer, in this connection, to that portion of the official release issued in May following the meeting of President Kennedy and the Prime Minister of Canada at Hyannis Port on May 11:
"On the great waters that separate and unite the two countries-the St. Lawrence river and the great lakes-it is essential that those who own

and sail the ships should be free to go about their lawful business without impediment or harassment."
As hon. members know, this harassment has continued. There have been several further acts of violence, illegal picketing, and one Canadian vessel has been refused the right of all shipping and loading facilities at the port of Chicago for over 100 days, despite the fact that court injunctions against such secondary picketing have been obtained.
It is to be sincerely hoped that the decision to establish a trusteeship will lead to a full resolution of the serious problems that have arisen in both Canada and the United States over the past three shipping seasons.
Trusteeship, which is a device used by the unions themselves to control and rehabilitate delinquent local unions, is a distasteful remedy to deal with a repugnant situation. Fortunately nearly everyone has realized that action along these lines is a necessity and has endorsed the commissioner's recommendation in this respect. While the government has every expectation of co-operation on the part of all responsible Canadian and United States union members and leaders and of all companies directly concerned, I do want to make it clear that should matters deteriorate on the great lakes or elsewhere, and it becomes necessary, parliament will be called back into session earlier than has been announced to deal with this matter.
In any event, sustained efforts will be maintained during our recess to see that cooperation with the United States authorities is developed to the fullest possible extent so that it will serve to supplement action taken by parliament. The interval may in fact prove useful not only to develop these supplementary lines of action but also to permit substitute action being taken should this prove to be equally effective in accomplishing the objectives of the legislation now being prepared.
I should add, Mr. Speaker, before concluding that the two special counsel, Mr. Robinette of Toronto and Mr. Martineau of Montreal, have already commenced their examination of the report of the inquiry commission and the accompanying exhibits and documents, and will be in a position to advise the government in due course with respect to prosecutions.


Hon. Michael Siarr (Ontario):: Mr. Speaker, we on this side of the house welcome the announcement that has been made by the Minister of Labour that the government has decided to put into effect by legislation the most important of the recommendations made
Establishment of Shipping Trusteeship by Mr. Justice Norris; that is, the recommendation to set up a trusteeship. I wish to say a few more words about that later.
First may I say that as minister of labour at the time this commission was set up I found it necessary, because of conditions existing on the great lakes, to take this action. We were very fortunate indeed to obtain the services of Mr. Justice Norris of British Columbia as the commissioner. Mr. Justice Norris did a wonderful piece of work in getting all the evidence after well over 100 meetings during the course of his investigation and in writing, as the Minister of Labour has stated, a very comprehensive report dealing, I might say, with a very serious situation which faced operations on the great lakes.
The interdepartmental committee which has been working since July 17 has certainly done a very effective job in its recommendations to the government, and it is well that the government has heeded the advice of Mr. Justice Norris and the interdepartmental committee in deciding to set up a trusteeship. I think this is advisable. I want to congratulate the Canadian Labour Congress and the other unions affiliated with them for their attitude in agreeing to operate under government trusteeship. Mind you, Mr. Speaker, as the Minister of Labour has said, it is distasteful to organized labour and very repugnant to them to be placed under trusteeship. Nevertheless I think the situation warrants this being done, but it should be on a very temporary basis. In other words the members of the trusteeship should work toward achieving a peaceful solution to the problem on the great lakes in as short a space of time as possible. Certainly it should not be a precedent for any case in the future unless the situation warrants it, as it did on the great lakes. I think it is very important that its duration be not too long, yet it should be sufficient to carry out the recommendations which have been made by Mr. Justice Norris.
I think another important aspect is the harassment of Canadian ships in United States ports. Since the government is willing to take decisive action through legislation, the United States government should be asked to take some more definite action in co-operation with the Canadian government in order to see that Canadian ships are able to put into United States ports and be loaded and unloaded without undue delay, which has not been the case with Canadian ships up to now, and as has not been the case with the Canadian ship now tied up in the port of Chicago.
The Minister of Labour mentioned that if the situation demands, or if there is any disruption on the great lakes between now and
2882	HOUSE OF
Establishment of Shipping Trusteeship the time the legislation is introduced, parliament may be recalled. I hope the government, and particularly the Minister of Labour and his department, will keep a very sharp lookout for such an eventuality and that they will do everything in their power to bring about a settlement; and I hope there will be no disruption of shipping on the great lakes between now and the time the legislation is enacted.


Mr. H. A. Olson (Medicine Hat):: Mr. Speaker, on behalf of this party I want to say, as the Minister of Labour pointed out, that we also recognize that public opinion has clearly been stirred. We are happy to see the government is going to take what the minister termed resolute action, and we hope this action will be of a nature which will prevent a situation of this kind ever again developing within a labour union in Canada. We commend the four of five unions which have agreed to go into trusteeship in recognition of this problem. We hope the Minister of Justice will not overlook the responsibility that we feel his department has in perusing and following up the subject matter of the report regarding possible prosecutions which should be muds' and. f'u'^prmnrp wp hops the Department of Justice will not overlook the alleged collusion between some shipping companies and the labour unions.
We too agree that this kind of action should not be considered as a precedent for curing labour problems, although we think it is necessary in this most extreme case. I listened carefully, but I do not think the Minister of Labour mentioned any effective date for the establishment of this trusteeship. However, if I understood his remarks correctly he would ask the government to call parliament back should the situation deteriorate to the point where action by parliament is necessary. All I want to say in this respect is that we in this group would be willing to co-operate with the government in this regard.
We also recognize the international problems which are involved, and we appreciate the difficulties here because of the tie between the union in Canada and the union in the United States. We hope that the government, as the hon. member for Ontario suggested, will take further steps to persuade the United States government to take action which will prevent this harassment of Canadian ships in United States ports.


Mr. T. C. Douglas (Burnaby-Coquiilam):: Mr. Speaker, I think the Minister of Labour is to be commended for the statement he has just made regarding the action which the government proposes to take arising out of the report of the Norris commission. I think he is particularly to be commended for having


consulted the Canadian Labour Congress, representing, as it does, the great bulk of the labour movement in this country; because the Canadian Labour Congress has been fully justified by the Norris report both in asking for the investigation in the first place and in the material which it submitted to the Norris commission in its brief presented last March. The fact that the minister has consulted with them and secured their co-operation will make it much easier to deal with this difficult situation.
This abnormal and disgraceful situation arose out of three factors. It arose out of a racketeering union, the seafarers international union, with the collusion of certain steamship companies, in particular the Canada Steamship Lines, which co-operated with Mr. Banks in breaking the laws of Canada. The third factor was the laxity of government administration. It was known the law was being broken, but no action was taken in this regard.
The proposal of Mr. Justice Norris for a trusteeship is something we normally would not support. Democratically elected, clean unions ought not to be put under government trusteeship. But the seafarers international union is not a democratic, clean uuioii. The evidence which was presented by the Canadian Labour Congress and which is fully corroborated in the report of Mr. Justice Norris proves that the S.I.U. is a cancerous growth on labour unions and on the body politic. Therefore I think the government has no choice but to place this union under a trusteeship.	_
Fortunately the other unions, which were given a clean bill of health by Mr. Justice Norris, have indicated their willingness voluntarily to come under this trusteeship as the quickest means of dealing with an unfortunate situation, and I think they are to be congratulated on this attitude. However, I would say the government is to be commended on declining to proceed with general legislation. I do not think we could support general legislation giving the government power to bring any union under trusteeship. I think the government is wise to wait until it can bring down specific legislation dealing with a union which has proved to be racketeers and dealing with unions which are willing to come within the scope of this trusteeship.
I hope the government will also give consideration to the position of the companies which have compounded this felony, particularly the Canada Steamship Lines, for the part they have played in this unfortunate and disgraceful situation. I would also hope the government could make some progress toward getting the co-operation of the government of

the United States in dealing with the position of Canadian ships which are in United States ports. There is a ship called the Red Wing at the ore dock in Marquette, Michigan. I am told the railway to the dock has been dynamited in recent days. Another ship was fired upon when it approached port facilities. This is a situation which cannot be allowed to continue, and I hope the government will be able to bring pressure to bear on the government of the United States to see that Canadian ships and seamen are protected.
One other point should be kept in mind. What is to happen in the meantime to the union funds of the seafarers' international union? I am told Mr. Banks has already placed a levy of $50 each on all his members in order that he may be in a position to fight any action which might be taken arising out of the Norris report. These funds may be badly misused and mishandled prior to any legislative action being taken. I therefore say to the minister and to the government that if they get this legislation ready soon and it looks as though union funds are being misused, and the situation is becoming more serious, they should have no hesitation about calling parliament back into session for two or three days in order to protect the members of the unions and to protect the public interest of the people of Canada.



BUSINESS OF THE HOUSE


John Whitney Pickersgill: I should like to table a list of outstanding orders for returns as requested yesterday by the Leader of the Opposition. It seems to me it might be a convenience to hon. members in checking up on the government if the house would agree to having this list made an appendix to today's Hansard.


Some hon. Members:: Agreed.
[Editor's note: for list above referred to, see appendix.]



DIVORCE BILLS


Mr. Ian Grant Wahn (St. Paul's) moved:: That Bills Nos. SD-51 to SD-251 both inclusive
considered by the standing committee on miscellaneous private bills and reported without amendment this day as its eighth report be placed on today's order paper after order No. 51 for consideration later this day by the house in committee of the whole.


Mr. Speaker:: Is it the pleasure of the house to adopt the said motion?


Some hon. Members:: Agreed.
28902-5-183
Proposed Legislation



PRIVATE BILL


Mr. J. H. Addison (York North) moved:: That Bill No. S-35, an act respecting the Crown Life Insurance Company, received from the Senate earlier this day, be placed on the order paper for second reading during the hour for private members' business later this day.


[Stage Direction]
Motion agreed to.


Mr. Eric A. Winkler (for Mr. Mandziuk) moved: for leave to introduce Bill No. C-93, authorizing the Senate of Canada to dissolve or annul marriages.
Motion agreed to and bill read the first time.


Mr. Herridge:: Is this the bill written by the Secretary of State?


Mr. Speaker:: When shall said bill be read the second time?


John Whitney Pickersgill: I believe there is general agreement in the house that hon. members would be agreeable to having this bill taken for second reading as the first order of business after five o'clock, and if I correctly interpret the sentiments of the house I wonder if that could be so ordered.


Mr. Speaker:: Is it the pleasure of the house to adopt the suggestion of the Secretary of State?


Some hon. Members:: Agreed.



CURRENCY. MINT AND EXCHANGE FUND ACT AUTHORIZATION TO PURCHASE SECURITIES OF INTERNATIONAL MONETARY FUND

Hon. Waller L. Gordon (Minister of Finance) moved: that the house go into committee at the next sitting to consider the following resolution, which has been recommended to the house by His Excellency:
That it is expedient to introduce a measure to amend the Currency, Mint and Exchange Fund Act to authorize the Minister of Finance to purchase out of the exchange fund account maintained under the act, securities of the international monetary fund.


[Stage Direction]
Motion agreed to.


[Stage Direction]
On the orders of the day:
Right Hon. J. G. Diefenbaker (Leader of the Opposition):: Mr. Speaker, in view of the approach of the end of this portion of the
2884	HOUSE OF
Inquiries of the Ministry session, could the Prime Minister enlighten the house and the country as to the present position regarding agreement on nuclear weapons with the United States, and the reason for the delay?


Right Hon. L. B. Pearson (Prime Minister):: Mr. Speaker, negotiations are still going on. There is no unusual delay. A draft is now before the cabinet, and in view of the importance of the negotiations and the importance of any agreement which may come from them I think the government should be given adequate time to consider it.


John George Diefenbaker: Mr. Speaker, would the Prime Minister be in a position to say approximately when the cabinet will determine this question, inasmuch as it was stated some weeks ago during the campaign that six weeks would be the time within which agreement would be reached?


Lester Bowles Pearson: Mr. Speaker, I would hope negotiations would be completed within a few weeks.	After	all,	as	the right	hon.
gentleman realizes, negotiations on this matter are difficult and complicated. Indeed, they were begun by the previous government three years ago. But I do hope they will be com-
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picccci, anu aauaiav-tuiiv	vnnuu
a week or two.


Hon. Marcel Lambert (Edmonton West):: supplementary question, Mr. Speaker. I take it the Prime Minister would not now share the view expressed by his colleague the Minister of National Defence on the day he was sworn in, that this would be a matter of about a month?


Mr. E. Nasserden (Rosthern):: Mr. Speaker, I should like to direct a question to the Prime Minister supplementary to the one he was asked earlier. Should an agreement be reached with the United States regarding the acquisition of nuclear arms, will that agreement be presented to parliament prior to signing?


Lester Bowles Pearson: No, Mr. Speaker. It would not necessarily be presented to parliament because it would be an act of the executive, but it would be discussed in parliament.


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I have a supplementary question for the Minister of Justice. Is the report correct that the minister made a speech on a French network the other night saying that the signing of the three power test ban treaty would make a difference to the acquisition of nuclear arms by Canada?


Hon. Lionel Chevrier (Minister of Justice):: Mr. Speaker, I do not accept the statement


nor the preamble to the question asked by an hon. member yesterday in connection with this matter. In view of the question asked yesterday I asked for the tape recording. I found there was not one available immediately, but to be exact this is what I said over the network in a press conference that lasted about an hour, in which I and two other ministers took part:
(Translation):
". . .that I ascertained that the former administration had committed itself to equip our weapons with nuclear warheads; second, that we were negotiating an agreement with the United States on nuclear arms and that we had every intention of carrying it through; and finally that the Prime Minister, during the election campaign, had said that we would implement our commitments, but that should conditions change, it could become advisable to amend such commitments." And that I never said anything contrary to the statements of the Prime Minister.
(Text):


Gilles Grégoire: I have a supplementary question.
(Translation):
Is the Minister of Justice saying that, in the case of a controversial program like that one, the station has not kept the recording either on video-tape or on magnetic tape?


Lionel Chevrier: Well, Mr. Speaker, I am not responsible for what the station does. All I can say is, that for that conference they used an entirely new technique and system; it is quite possible that under those circumstances, the recording of this conference has not been kept.
(Text):


Gilles Grégoire: I have a supplementary question for the Secretary of State. Is there not a rule or regulation of the B.B.G. that all stations should keep recordings of broadcasts of this kind for one year?


John Whitney Pickersgill: Mr. Speaker, I would very much hesitate to reproduce the law from memory, much less give a legal opinion. I will inquire of the B.B.G. and give an answer.


Thomas Clement (Tommy) Douglas: In view of the fact that the signing of a nuclear arms agreement within the United States is of such far reaching importance, and in view of the changed situation since the matter was discussed in the speech from the throne debate, does the Prime Minister not think it would be incumbent on the government to submit this matter to parliament?


Lester Bowles Pearson: The house had a chance to debate this matter, and I think did debate

it tor four or five days, and a decision was taken by the house at that time.


Thomas Clement (Tommy) Douglas: The position has changed considerably since then.
(Translation):


Hon. Theogene Ricard (Si. Hyacinihe-Bagoi):: Mr. Speaker, I have a supplementary question for the Minister of Justice.
Could the minister tell the house at what date was an agreement on nuclear weapons signed by the former government?


Lionel Chevrier: Mr. Speaker, the hon. member for St. Hya-cinthe-Bagot should direct that question to his former prime minister. As for me, what I said, and I repeat, is that I personally ascertained whether an agreement has been signed, by which Canada had undertaken to fulfil certain specific engagements, namely to fit its weapons with nuclear warheads.
(Text):


John George Diefenbaker: That is not true. (Translation):


Gilles Grégoire: Mr. Speaker, I should like to direct a question to the Minister of Justice. Can he tell the house whether he has made inquiries regarding the recording of his television broadcast made a few days ago and if so, from what television station did he inquire?


Lionel Chevrier: Mr. Speaker, I have inquired from the person who had invited me to take part in the program.
(Text):



BOBCAT PERSONNEL CARRIERS


[Stage Direction]
On the orders of the day:
Hon. D. S. Harkness (Calgary North):: Mr. Speaker, I wish to direct a question to the Minister of National Defence. Can the minister inform the house whether the development run of 20 Bobcat armoured personnel carriers for the army has been completed? If not, when is it anticipated that the development run will be completed?
Hon. Paul Hellyer (Minister of National
Defence): It has not yet been completed, Mr. Speaker. At the moment we are looking into the reason it has not, in order to determine what action should be taken in future. (Translation):



NORTHERN AFFAIRS


[Stage Direction]
On the orders of the day:
Louis-Joseph Pigeon: Mr. Speaker, may I ask the
Minister of Citizenship and Immigration a 28902-5-183$
Inquiries of the Ministry question? Has the minister read the statement by Mr. Eric Gourdeau of the Quebec government, who charged the Minister of Citizenship and Immigration and the Minister of Northern Affairs and National Resources with insincerity and accused them of having delayed the meeting between the two parties in regard to the transfer of Eskimo affairs to the Quebec administration?


Hon. Guy Favreau (Minister of Citizenship and Immigration):: Mr. Speaker, I must say that I was informed this morning of the statement made by that provincial official, Mr. Gourdeau, and that I was amazed that in the absence of the minister, Mr. Levesque, that civil servant should take the liberty to criticize, on behalf of the provincial government, the attitude of two federal ministers.
In regard to the statement that the federal government unduly and unfairly delayed the negotiations concerning the transfer of the Eskimo affairs administration, I think it would be interesting for all the members of this house to know that it concerns both the present and the previous governments and that they both are in the same situation.
In 1935, it was the province of Quebec itself which asked the Supreme Court of Canada to state that the responsibilities for Eskimo affairs should rest, not with the province of Quebec, but exclusively with the federal government. The decision was made in 1939, so that was 24 years ago. Now, suddenly, it was decided this year that the province should take over Eskimo affairs.
We could have quite a discussion on the matter and I respect everyone's opinion, but I must say that before the federal government, or rather before the minister of northern affairs and myself should recommend to the government to abdicate its responsibilities in matters concerning the Eskimos 24 years after the decision made by the supreme court and during which period we assumed responsibility in the matter, we must be entirely satisfied that it would be in the interest of the Eskimos and that all facilities would be made available to them. Then, and only then will the recommendation be made.
It should be noted that at a time when parliament was extremely busy, a meeting was held on June 26; discussions were held under friendly conditions, and we offered to meet the minister of natural resources during our holidays; therefore, it is unfair for a provincial official to accuse us, on behalf of his government, of delaying the negotiations. After all, a month's delay compared to 24 years is very little.

Inquiries of the Ministry
So, it is no exaggeration to state here that the minister of northern affairs and myself are still at the disposal of the provincial minister, but not necessarily at the disposal of Mr. Gourdeau, in order to set the date for a meeting as soon as possible.
I may add that I did not know Mr. Rene Levesque had delegated his powers to Mr. Gourdeau and that he had not informed me that a summit conference was to be held between two federal ministers and a provincial official.


Hon. Paul Mariineau (Ponfiac-Temiscamin-gue):: In view of the elaborate explanation given by the minister, could he simply tell us whether this matter of transfer of jurisdiction in the administration of affairs relating to New Quebec Eskimos has been submitted to the cabinet?


Guy Favreau: I answered earlier that the cabinet had appointed the minister of northern affairs and myself to discuss with provincial ministers their claims in that connection. We held discussions and shall continue to do so with a completely open mind. If both of us reach the conclusion that it would serve the best interests oi the Eskimos, a recommendation will be made to the cabinet, but it will not be before we have ascertained that point and before the provinces have submitted all the arguments enabling us to decide this transfer, but there will be no surrender of our responsibilities in the matter.


Louis-Joseph Pigeon: In view of the statement of the minister, is the federal government-
(Text):


Mr. Speaker:: Order, please. The hon. member for Lapointe has the floor.


Mr. D. M. Fisher (Port Arthur):: Mr. Speaker, mine is a supplementary question to the Prime Minister. In view of the nature of the problem and the very able reply by the Minister of Citizenship and Immigration, is there any possibility that this matter could come within the terms of reference of the royal commission on biculturalism, since it is a problem of biculturalism as much as it is one of jurisdiction?


Lester Bowles Pearson: I will be glad to look into that, Mr. Speaker.
(Translation) :


Louis-Joseph Pigeon: I rise on a question of privilege. Mr. Speaker, you decided against allowing a supplementary question, while you authorized the hon. member for Port Arthur (Mr. Fisher) to put a question on the same subject.


J.-H.-Théogène Ricard: Mr. Speaker, I should like to ask the Minister of Citizenship and Immigration (Mr. Favreau) whether he approves or disapproves of the stand taken by the minister of natural resources in his statements concerning northern Quebec.


Guy Favreau: As I said earlier, the Supreme Court of Canada has entrusted the responsibility for the welfare and education of Eskimos to the federal government, which will assume such responsibility until we are given clear indication that this transfer is in the best interests of the Eskimos and we are in a position to reach a sound decision in that respect.
(Text):


Mr. G. W. Baldwin (Peace River):: Mr. Speaker, I should like to ask the minister a supplementary question. As a result of his reading of the judgment is it his opinion that this is a matter which can be decided by executive action on the part of the government, or must the matter be submitted to parliament?


Guy Favreau: Mr. Speaker, I am afraid I cannot answer that question. I have my own opinion, but I am afraid the question is seeking a legal opinion from a minister who is not the Minister of Justice.


Gerald William Baldwin: Then I ask the Minister of Justice, Mr. Speaker.


Mr. Speaker:: Are there any other supplementary questions?


Thomas Clement (Tommy) Douglas: May I ask the minister if anyone has thought of asking the Eskimos under whose jurisdiction they would like to come, rather than moving them about like pawns on a chessboard? Probably they would have something to say about what jurisdiction they would like to come within.


Mr. Speaker:: Has the hon. member for Joliette-L'Assomption-Montcalm a question to ask?


Louis-Joseph Pigeon: Yes, Mr. Speaker. (Translation):
In the absence of the Minister of Northern Affairs and National Resources, I should like to direct a question to his parliamentary secretary. Could he tell us if the minister intends to do something about the shameful conditions in which the Eskimos of New Quebec have to live, according to Mr. David Eccles of Toronto?


Mr. John N. Turner (Parliamentary Secretary to Minister of Northern Affairs and National Resources):: Mr. Speaker, for the information of the hon. member, I wish to say that I have read the article in Le Droit and that Mr. Eccles has met with officials of the department on two occasions. Furthermore, I saw the movie yesterday and I discussed the matter with Mr. Eccles. I think I can say on behalf of the minister that an investigation has been ordered in that connection. Mr. Eccles has also been asked to submit an abridged version of his allegations.



NATIONAL BATTLEFIELDS COMMISSION


[Stage Direction]
On the orders of the day:
Mr. Jean-Charles Canlin (Parliamentary Secretary to Minister of Transport):: Mr. Speaker, in the absence of the Minister of Northern Affairs and National Resources, could his parliamentary secretary tell us whether the staff of the national battlefields commission will soon be complete?


John Napier Turner: Mr. Speaker, in answer to the member for Quebec South, f am pleased to announce, on behalf of the Minister of Northern Affairs and National Resources, that the governor in council appointed yesterday Mr. Jean Leahy, Q.C., from the city of Quebec, to replace the late Mr. James Murdoch on the national battlefields commission. Mr. Leahy is 38 years old, perfectly bilingual and apart from being an active member of the bar, he teaches civil law at the University of Montreal. (Text) :
I am sure that Mr. Leahy will make a valuable contribution to the commission.



SASKATCHEWAN


[Stage Direction]
On the orders of the day:
Mr. S. J. Korchinski (Mackenzie):: Mr. Speaker, 1 have a question for the Minister of Northern Affairs and National Resources but in his absence I would direct it to his parliamentary secretary, who has been able to handle some of the questions here today. If he cannot answer it perhaps he will take it as notice. Has the Minister of Northern Affairs and National Resources had discussions with the minister of natural resources in the province of Saskatchewan in relation to the extension of the roads to resources program? If so, what was the nature and what were the results of the discussions?
Inquiries of the Ministry


John Napier Turner: Mr. Speaker, the Minister of Northern Affairs and National Resources has indeed had conversations with the provincial minister, Mr. Kramer. The subject of the discussions had to do with the possibility of a future joint program. I do not think I can add anything more at the moment.



PUBLIC SERVICE


[Stage Direction]
On the orders of the day:
Mr. A. B. Patterson (Fraser Valley):: Mr. Speaker, I should like to direct a question to the Minister of Finance. Can the minister advise the house as to the government's response to the request made in a brief by the civil service federation of Canada for an upward revision of superannuation allowances paid retired civil servants who retired prior to 1958?


Walter Lockhart Gordon: The hon. member was kind enough to give me notice of his question. I should like to inform him that I have written to the president of the civil service federation of Canada advising him that the government has this matter under careful study.


Stanley Howard Knowles: Mr. Speaker, may I ask a supplementary question. Will consideration be given to introducing legislation to amend the Public Service Pension Adjustment Act before the end of this session?


Walter Lockhart Gordon: Mr. Speaker, I have just said the matter is under study. I presume that when the study is completed that question can be considered.



AIRPORTS


[Stage Direction]
On the orders of the day:
Marcel Joseph Aimé Lambert: May I address a question to the Minister of Transport. In doing so I would say that normally I would not ask this question at this time, but in the light of the approaching adjournment I seek the information because it is urgent. As the result of a meeting of the minister, the mayor of the city of Edmonton and other representatives, as well as other representations which have been made to him with regard to the future of Edmonton's municipal airport, has the minister arrived at a decision in respect of the department's facilities at that airport and its continued use as an industrial airport?

Inquiries of the Ministry


Hon. G. J. Mcllraiih (Minister of Transport):: Mr. Speaker, the decision regarding the continued use of the airport rests entirely within the control of the city of Edmonton. I have, however, since the interview referred to by the hon. member, communicated to the mayor my view that since the new Edmonton international airport is fully capable of taking care of the aviation requirements of the area so far as we can see, we believe that the city should be prepared to assume financial responsibility for such federal aviation services as the city may require to be continued at the municipal airport. I have also informed the mayor that because of the capacity of the international airport, the size of which was increased during the construction period, I see no need to hold the city to its earlier commitment that it maintain a secondary airport.



TRANSPORT


[Stage Direction]
On the orders of the day:
Gilles Grégoire: I should like Lu auuress a quesliuu iu the Minister ur
Transport. Will the minister consider the advisability of restoring to members of the parliamentary press galley in Ottawa their railway passes which were taken from them by the previous government?


George James McIlraith: Mr. Speaker, I am not aware of what the previous government did in this connection. In any event, I will take the question under advisement. I am rather of the impression that the Minister of Transport has no such authority as that implied in the question.



COLUMBIA RIVER


[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: I wish to address a question to the Secretary of State for External Affairs, I think my last question before he goes on tour. Will the minister inform the house if in his opinion, and in the light of all the circumstances, the British Columbia hydro authority can now sign a contract with any United States power authority with regard to the price to be paid for the Columbia river treaty downstream benefits?


Hon. Paul Martin (Secretary of State for External Affairs):: I do not know what the United States power authority is, to which my hon. friend is referring. There are a number of agencies and utilities, both private and

public, in the Pacific northwest, but none by that name so far as I can find out. The actual parties to any agreement for the sale of Columbia river downstream benefits will have to be decided upon when and if a satisfactory agreement with the United States has been worked out.


Gilles Grégoire: May I ask
a supplementary question. Has the minister accepted the invitation from the hon. member for Kootenay West?


Paul Joseph James Martin: The hon. member for Kootenay West has not given me the particulars, which would have to be carefully considered.



VETERANS AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. Edmund Asselin (Noire Dame de Grace):: I should like to address a question to the Minister of Veterans Affairs. Having regard to the recent F.L.Q. bombing incident in the Montreal area which resulted in the near fatal wounding and permanent disability of Sergeant Major Leja of the third field regiment, Royal Canadian Engineers, can the Minister of Veterans Affairs say whether he has given any consideration to granting a pension to this brave Canadian officer and, if so, will he inform the house of any decision taken?


Hon. Roger Teillet (Minister of Veterans Affairs):: I am grateful to the hon. gentleman for giving me the opportunity to convey to the house information in which it was keenly interested some weeks ago when the hon. member for Kootenay West asked a question about Sergeant Major Leja. I should like to point out to the hon. gentleman who asked the question that of course decisions on pensions are not taken by the minister. He has no such authority.
However, I am informed by the pension commission that Sergeant Major Leja is now in receipt of 100 per cent pension. Upon his release from the hospital his case will be considered for supplementary allowances for disability. The chairman of the Canadian pension commission expects to have a report on this matter for consideration shortly. In addition I should like to inform the house that I had the opportunity of seeing the sergeant major in hospital last week. Although I was not able to speak with him, I can report to the house that his progress is as satisfactory as can be expected under the circumstances.


Hon. Gordon Churchill (Winnipeg Soulh Centre):: May I ask a supplementary question. Can the minister inform the house under what section of the act this commendable action of the pension commission was taken?


Roger-Joseph Teillet: I would have to check back to answer that. The information I have from the commission is as I have stated.


Roger-Joseph Teillet: Mr. Speaker, I now have the information requested by the hon. member for Winnipeg South Centre. That was done under section 13, subsection 2, which I understand is the section that deals with peacetime service pensions.



FINANCE


[Stage Direction]
On the orders of the day:
Mr. Colin Cameron (Nanaimo-Cowichan-The Islands):: I have a question for the Minister of Finance, based on a report that appeared in this morning's Montreal Gazette to the effect that a New York bank is preparing to acquire a 50 per cent interest in a Canadian bank. My question is this. Can the minister tell the house whether the governor in council has approved this purchase as required by section 102 of the Bank Act?


Walter Lockhart Gordon: Mr. Speaker, the government is giving most careful consideration to this matter with a view to determining what may be best in the national interest. It has not approved the transaction and I am not at all sure this matter is subject to approval by the governor in council.
(Translation):



HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Mr. Henri Latulippe (Complon-Fronlenac):: Mr. Speaker, I should like to direct a question to the Minister of National Health and Welfare. Could she tell the house why she cannot increase family allowances, in the same way it has been possible to raise the salaries of a great number of people who were paid enough already?
(Text):



FISHERIES


[Stage Direction]
On the orders of the day:
Inquiries of the Ministry
Mr. Barry Mather (New Westminster):: Mr. Speaker, I wish to direct a question to the Minister of Fisheries. Can the minister report anything in respect to the North Pacific fisheries treaty discussions involving Canada, the United States and Japan, and can he say when and where these discussions will resume? Also, if he is replying might he say a word on a related subject, namely the negotiations in the British Columbia fishing strike?


Hon. H. J. Robichaud (Minister of Fisheries):: Mr. Speaker, as I reported to the house on June 24 a series of meetings among Canada, Japan, and the United States to study the renegotiation of the North Pacific treaty were adjourned on June 21. It is now proposed to resume negotiations in Tokyo, and the date suggested is September 16.



BRITISH COLUMBIA


[Stage Direction]
On the orders of the day:
Hédard-J. Robichaud: Mr. Speaker, yesterday the hon. member for Comox-Alberni asked the following question:
Will the minister indicate whether the government will consider directing the fisheries prices support hoard to take action-

in connection with the sale of 500,000 cases of pink salmon carried over from last year. I wish to inform the house that this matter has been taken into consideration by the fisheries prices support board, but no decision has been arrived at as yet.



LABOUR RELATIONS


[Stage Direction]
On the orders of the day:
Hédard-J. Robichaud: Mr. Speaker, I wish to reply to two questions which were asked yesterday in my absence and of which notice was taken by the Secretary of State. The hon. member for New Westminster, referring to the provincial-federal arbitrator in the British Columbia fishing dispute, asked whether the arbitration-
-will proceed under provincial or federal arbitration legislation, also what will be the powers and terms of reference of the arbitrator?
I wish to inform the house that the arbitration will proceed under provincial legislation. So far as the terms of reference are concerned, as it is voluntary arbitration the terms must be arrived at by the two parties, the union and the association. I am also informed that two meetings were held yesterday, and I understand they are again meeting today to try to come to agreement regarding the terms of reference.

Inquiries of the Ministry (Translation) :



POSTAL SERVICE


[Stage Direction]
On the orders of the day:
Mr. Remi Paul (Berlhier-Maskinonge-De-lanaudiere):: Mr. Speaker, may I put a question to the distinguished Postmaster General?
Does he intend to make a personal investigation, when the house is adjourned, on the possibility of a twice-a-day mail delivery starting next fall?


Hon. Azellus Denis (Postmaster General):: Mr. Speaker, I do not think that such an investigation will be necessary, because we have not received any complaint about the present mail service.
(Text):



NATIONAL REVENUE


[Stage Direction]
On the orders of the day:
Mr. Grant Deachman (Vancouver Quadra):: Mr. Speaker, I have a question for the Minister of National Revenue. Now that the expropriation oi tne LS.c. Electric oy tne government of British Columbia has been invalidated by the courts, will his department collect income tax from August 1, 1961, the date when the company was expropriated? Moreover, will the department, if necessary, use the delinquency sections of the Income Tax Act to seize the assets of that company against delinquency in taxes?


Hon. J. R. Garland (Minister of National Revenue):: I wonder if I might take that question as notice.



INDUSTRY


[Stage Direction]
On the orders of the day:
Mr. G. H. Aiken (Parry Sound-Muskoka):: Mr. Speaker, I have a question for the Prime Minister. Can he advise the house whether the details of the plan for the stockpiling of uranium have been worked out?


Lester Bowles Pearson: Mr. Speaker, a supplementary estimate covering this matter will be before the house before the recess, and this question can be discussed then.



TRADE AND COMMERCE


[Stage Direction]
On the orders of the day:
Paul Raymond Martineau: Mr. Speaker, I have a question for the Minister of Trade and Commerce. Has
the minister made, or does he expect to have made, any adjustment in the investment survey which he tabled in the house earlier this week, in view of announced intentions by companies to curtail or change their spending plans as a result of the June 13 budget and subsequent events?


Hon. Mitchell Sharp (Minister of Trade and Commerce):: Mr. Speaker, as the hon. gentleman is well aware this report, that was released yesterday, has been published at this time every year for many, many years, and the minister has nothing to do with the report except to publish it.
In response to the second part of the question, before the report was published I asked my officials when the information was gathered, and they told me that most of it was gathered just before the budget was presented and, of course, all the forms were in before the subsequent amendments to the budget resolutions were announced. I then asked my officials what they thought the effect upon these expectations would be of the budget and the subsequent amendments. In their opinion, for that one cause-of course there may be any number of other causes that affect these figures-on account of the budget itself they felt the effect would be to stimulate investment.


Some hon. Members:: Oh, oh.


Paul Raymond Martineau: Mr. Speaker, I wonder whether, in view of the minister's answer he can make any comment particularly in regard to the statement contained in this morning's Gazette that capital spending may be curtailed by as much as $250 million because of the budget and the interest equalization proposal of President Kennedy.


Mitchell William Sharp: Mr. Speaker, I was referring only to the budget itself, and I was quite specific about that. I think the effect of the budget proposals that are before the house or have been before the house will be to speed up investment. There are other factors at work, but I am not commenting on those.
(Translation):



CANADIAN NATIONAL RAILWAYS


[Stage Direction]
On the orders of the day:
Mr. Auguste Choquetie (Lotbiniere):: Mr. Speaker, I should like to direct to the Minister of Transport a question arising from a resolution passed by the municipal corporation of the village of Manseau, whose mayor is Mr. Maurice Savoie, and which has been sent to me with a request that I secure the

necessary information. Is the Minister of Transport aware of the request sent by the Quebec department of highways to the board of transport commissioners, asking the widening of the level crossing in the village of Manseau and the moving of the signals there?


Jean-Charles Cantin: Mr. Speaker, as the minister is absent momentarily, I take as notice the hon. member's question.
(Text):



OLD AGE SECURITY


[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, may I direct a question to the Prime Minister. In case the house recesses tomorrow night, would the Prime Minister be in a position tomorrow to give a further answer to my question of two days ago? I asked him whether the government would consider making an announcement before the recess as to the effective date of the proposed $10 increase in the old age security pension. The Prime Minister will recall that he said on Wednesday the government would consider the matter.


Lester Bowles Pearson: Mr. Speaker, I hope the effective date will be as early as possible, but of course it will depend on the date on which the legislation passes this house. I hope that will be as soon as possible.



INQUIRY AS TO PAYMENT OF


[Stage Direction]
On the orders of the day:
John George Diefenbaker: Mr. Speaker, in view of the hope expressed by the hon. member for Winnipeg North Centre that this part of the session will adjourn tomorrow, I would like to ask the Prime Minister whether the government has made a determination on the question of providing $2 a bushel as a minimum price for the farmers' wheat. That was a promise made by his party. At the same time he might tell the house, if the answer is in the negative, whether this is a present day application of the 5 cent speech, and that because the west did not return Liberal members the promise is not going to be carried out.
28902-5-184
Economic Council of Canada
Righf Hon. L. B. Pearson (Prime Minister):
Mr. Speaker, the first and last part of the right hon. gentleman's speech make it unnecessary to answer the middle part.



ECONOMIC COUNCIL OF CANADA


[Stage Direction]
The house resumed, from Wednesday, July 31, consideration in committee of Bill No. C-72, to provide for the establishment of an economic council of Canada-Mr. Lamontagne -Mr. Lamoureux in the chair.
On clause 10-Initiation of studies, etc.
Marcel Joseph Aimé Lambert: In connection with this
clause, Mr. Chairman, I would like to ask the minister whether within the powers or the duties of the council to initiate such studies, inquiries and other undertakings as may be necessary in order to arrive at the conclusions envisaged by the duties of the council it is in the contemplation of the government that there will be a proliferation of information bulletins or forms that will have to be filled in by business from one end of the country to the other. Also, what degree of co-operation do they anticipate from business concerns in this regard? In the event that the information should not be obtainable, what steps would be taken in order to obtain it? I know there are provisions for compulsion on behalf of the dominion bureau of statistics under the Statistics Act, and in many cases these returns cost business firms quite some expense. Are we going to have another series of forms to fill out, or will the council rely as much as possible or in the main on information already in the hands of the dominion bureau of statistics?


Mr. Lamontagne:: That would certainly be my understanding.


Marcel Joseph Aimé Lambert: Is it the intention to initiate new inquiries on the business basis, and also to reinforce these inquiries with some legal teeth?


Maurice Lamontagne: There is no provision in this bill, Mr. Chairman, to force companies or individuals to answer a questionnaire sent out by the proposed economic council.


Marcel Joseph Aimé Lambert: I wonder whether in relation to clause 14 there might be power already there under the regulations. The clause says:
The council may, subject to the approval of the governor in council, make bylaws for the regulation of its proceedings and generally for the conduct of its activities-
Therein there might be interpreted the opportunity for instituting such proceedings.

Economic Council of Canada


Maurice Lamontagne: I do not think this power to make regulations would include the power to force individual firms to answer questionnaires sent out by the council. It seems to me that we would need a definite provision in this bill, which is not there.


Alexander Bell Patterson: Mr. Chairman, there are two matters in this clause to which I should like to call attention. The first sentence says that the council "shall initiate such studies", and so on. It seems to me this is rather restrictive, and that consideration should be given to broadening this term. To leave the entire responsibility with the council might in some way limit the purpose and objective of the measure, and I wonder whether the minister would therefore give consideration to broadening this wording so as to allow for suggestions from other sources.


Maurice Lamontagne: Mr. Chairman, I am quite willing to do this, and my colleague the Minister of Citizenship and Immigration will propose an amendment to clause 10 which I think will meet the hon. member's request.


Guy Favreau: Mr. Chairman, this is one of the matters which have been discussed with and considered by the President of the Privy Council. I move:
That clause 10 of Bill C-72 be amended by striking out lines 4 to 7 on page four and substituting therefor the following:
"10. The council shall on its own initiative, or if directed by the minister, conduct such studies, inquiries and other undertakings as may be necessary with respect to any matter coming within paragraphs (a) to (k) of section 9 or with respect to any other matter or".
This would give the minister a clear right to direct studies and inquiries as well as any other undertakings to be carried out by the council itself.


The Chairman:: Shall the amendment carry?


Mr. Fairweaiher:: Mr. Chairman, I wonder whether the President of the Privy Council could deal with one matter. There was an editorial in yesterday's Globe and Mail on a matter of growing concern in this country with regard to the movement of a company from one area to another, with resultant loss of jobs and so forth. Is this situation within the contemplation of either clause 9 or clause 10? Although we would not want to think the council would direct a company not to do this, it should at least, before such a move did take place or after it was announced, obtain some help or suggestions to eliminate the possibility of people being thrown out of work in a ruthless manner.


Maurice Lamontagne: Mr. Chairman, I think such problems could be investigated by the council. If we go back to clause 9, which


was approved yesterday, paragraphs (f) and (h) would, I think, cover the point made by the hon. member.


[Stage Direction]
Amendment agreed to.
Lucien Lamoureux: Shall the clause as amended carry?


Alexander Bell Patterson: Mr. Chairman, I mentioned that there were two or three matters to which I should like to refer today. With the passage of the amendment last evening I think there will have to be a renumbering or relettering of this particular clause.


Maurice Lamontagne: This has been provided for in the amendment proposed by my colleague. Instead of paragraph (j) in clause 10 we refer to (k). I think this meets the point raised by the hon. member.


Alexander Bell Patterson: Fine. Just one other matter. The clause states that the council shall report to the minister as circumstances require. I think this is an important consideration, because we raised the question whether it was proper that only the minister should receive the recommendations or advice of this council. I believe it would be of value if these
r9T?0rtS won* pwnilto ntliprc nc w**ll cnirb
as management and labour. If reports are made only to the government it would take away the incentive toward co-operation of labour and management.
I should like to call attention to an article with regard to this matter which appeared in the Globe and Mail of Tuesday, June 11, 1963 entitled "Limit independence of economic council". I should like to read just a brief section:
Unlike the board, the council has no authority to publish certain special studies without the consent of the minister.
The one new feature in the bill relating to this question is laid down in these words: "The council shall, annually prepare and cause to be published a review of medium and long term economic prospects and problems."
-the council could well consider its freedom is sharply circumscribed by the lengthy list of subjects on which it is directed to report only to the government.
I should just like to refer back to clause 9, in which it is stated it is essential to encourage the maximum consultation and co-operation with labour and management. It seems to me that to accomplish this it would be essential for those bodies to have access to the recommendations of the council. There appeared in the Globe and Mail of Friday, July 26, an article by Ronald Anderson in which it is stated:
We think it is essential that the body should not be inhibited from studies of controversial economic policy problems, that this work be published, and that the government not assume responsibility for the findings.

The function of the advisory council would be to establish better communication between government, economic experts and economic interest groups, and to achieve a public consensus on national economic objectives.


Maurice Lamontagne: I would draw the attention of the hon. member to another clause in the bill, namely clause 21, which deals with reports and publications. When we come to that clause I shall wish, incidentally, to propose a change. So I suggest we might postpone discussion of the matter raised by the hon. member until we reach clause 21.


Alexander Bell Patterson: There is another matter. I think the hon. member for Edmonton West referred to it, namely whether the council is to be given the power, for the purpose of making its inquiries, of a commission under section 1 of the Inquiries Act. It seems a situation could conceivably arise in which powers of this kind would be necessary if full information were to be obtained. I wonder if the minister would give consideration to this point also; otherwise the effectiveness of the council might be limited.


Maurice Lamontagne: This a legal point, and I would ask my colleague the Minister of Citizenship and Immigration to comment on it.


Guy Favreau: This point has been discussed with the advisers of the Department of Justice. As far as we are concerned, they have satisfied us that it is not necessary to do as the hon. member has suggested, because- and this is just a matter of drafting-this is clearly covered by sections 2 and 3 of the Inquiries Act. We may all rely on the fact that whenever the governor in council, who is the authority to deal with matters under the Inquiries Act, would so state, then the direction would be tantamount to and exactly in the nature of a direction under the Inquiries Act, so any such provision as the hon. member suggests would be surplusage. However, I agree with the hon. gentleman that this was a good question to bring up because it was one of the matters which had to be considered.


Alexander Bell Patterson: The purpose will be served?


Guy Favreau: Yes.
Clause as amended agreed to.
On clause 11-Powers of governor in council.
(Translation):


Louis-Joseph Pigeon: Mr. Chairman, I consider subparagraph (iv) of section 11, paragraph (1) most dangerous in respect of provincial rights. Knowing that the minister is an autonomist, and we will indeed see, when I submit my 28902-5-184i
Economic Council of Canada amendment, whether the minister is really in good faith and if he will amend the statements he made in the past and the action he took against provincial sovereignty, by welcoming my amendment to protect provincial rights and prevent the federal government from taking advantage of this council to intrude once again in provincial affairs by virtue of subparagraph (iv) which I quote:
The use of training programs at all levels of industry, and the use of retraining programs to meet changing manpower requirements.
If, as the minister said yesterday, he consulted with the provincial premiers, not formally but in semi-official meetings, and more particularly with the premier of the province of Quebec, I am convinced that the minister can tell us that if the premiers of Quebec and of the other provinces have read that section, they certainly did protest, and more particularly the premier of Quebec, because that section means interference in provincial jurisdiction. Now, we, on this side of the house, want the minister to tell us: "We do not want any interference in fields under provincial jurisdiction". We want the minister to prove it, and that is why I submit that subparagraph (iv) be amended by adding the following text after the word "requirements":
But that any program within this section shall be limited to matters of federal jurisdiction-
I should like the minister to add that to subparagraph (iv). If he is sincere and really wants to protect the rights and sovereignty of the provinces, I think he will accept that amendment willingly and be grateful to the opposition for proposing it.


Maurice Lamontagne: Mr. Chairman, I find it rather strange to hear the hon. member attack somewhat violently that particular clause since it was taken almost word for word from section 10 of the National Productivity Council Act which was put forward in this house by the hon. member's own party when it was in power.
Such a change of heart is coming a bit late.


Louis-Joseph Pigeon: Mr. Chairman, may I point out to the minister that we had prepared an amendment to correct that situation.


Lucien Lamoureux: Order. The hon. member will kindly allow me to put the amendment. (Text):
I assume that this is proposed as an amendment to clause 11.

Economic Council of Canada (Translation):


Maurice Lamontagne: I therefore think that the hon. member's attitude is rather inconsistent, when he wants us to do something which he himself did not approve when the National Productivity Council Act was passed by the house.
But, in order to comment on the proposed amendment more directly, I am of the opinion, although I am not a lawyer, that the amendment is entirely useless because it would be a legal, or rather legislative "tautology", and the federal parliament has certainly no right to legislate on anything which does not come under its jurisdiction under the constitution.
I do not think that to limit the federal government or that organization to programs under federal jurisdiction, would mean anything under the circumstances; such a limitation would neither add nor change anything at all because, to my mind, if the schemes with which the council would deal were in the provincial field this would be entirely unconstitutional.


J.-H.-Théogène Ricard: Mr. Chairman, I would like *0 Stdd ?. f9TV romarlrc to	of mv "hon
friend and colleague, the hon. member for Joliette-L'Assomption-Montcalm (Mr. Pigeon).
I see, as he does, in that section the risk of conflicting authorities, because, considering former comments by the minister, and the President of the Privy Council, I cannot but conclude that there should be co-operation between the other provinces and the federal authorities. Now, this would mean that there also should be some unity of thought, co-operation between provincial and federal authorities in respect of joint programs.
Moreover, in view of the provincial minister's remarks, namely the minister of natural resources, Mr. Levesque, to the effect that Quebec should eventually withdraw from joint plans, I wonder what would be the comments of the President of the Privy Council in that respect as well as with regard to the remarks of the minister of resources of the province of Quebec.
Would it have the effect of weakening cooperation, or would the minister, to be consistent with his former remarks, have to recommend that any joint planning be stopped by provincial authorities? And that he himself, as federal minister, would make the necessary provisions to discourage, rather than stimulate, joint planning between provincial and federal authorities?


Louis-Joseph Pigeon: Mr. Chairman, I have a question for the minister. We are concerned because the minister, as we know, has always had centralizing tendencies, and besides, since this government came to office-


Maurice Lamontagne: It is your own legislation.


Louis-Joseph Pigeon: Mr. Chairman, we are the party which favours confederation. We have always been in favour of respecting provincial rights. But since the Liberal government came to power we have seen something new. For instance, never in the history of the province of Quebec, had a premier and his cabinet sent such severe and serious ultimatums such as those which were sent to the present government.
In this house we want to act as spokesmen of the ministers and friends of the hon. minister, in order to protect the provincial rights and the rights of the province of Quebec in order that we may indirectly grant the request of the authorities of Quebec. That is all.


J.-H.-Théogène Ricard: Mr. Chairman, I would like to ask the minister whether he has a reply to
mv miPQ+innc: nr whpthor T mav pnnolurjp that
he cannot find one? It is very easy to say: "It is your own legislation", but on April 8, the people rendered a verdict, and if the minister is of the opinion that he is bound by the measures taken previously, he ought to say so in this house, so that we may know where we stand in the future.


Maurice Lamontagne: Mr. Chairman, I have nothing to add to what I said previously in connection with the amendment.
The productivity council as it was said yesterday, and as I said myself, has obviously done some useful work. There has already been in that field full co-operation with the provinces. I do not know of any province who would have had something to say against the activities of the national productivity council to date.
I do not see why the economic council, which would have exactly the same responsibilities as the national productivity council, could cause any opposition if the previous council did not.
(Text):


Lucien Lamoureux: Is the committee ready for the question? Perhaps I should read the amendment again.
3. Any programs within this section shall be limited to matters of federal jurisdiction.
[The Chairman.]

Amendment (Mr. Pigeon) negatived: Yeas, 20; nays, 46.


Lucien Lamoureux: I declare the amendment lost. Shall clause 11 carry?


Some hon. Members:: Carried.


Lucien Lamoureux: Clause 12.


Alexander Bell Patterson: Mr. Chairman, I should like to make a tew observations on subclause 2 of clause 11; at least, I should like to ask some questions. The subclause reads:
Any specific programs initiated by the council in relation to any of the objectives set forth in paragraph (a) -


Lucien Lamoureux: Order. Is the hon. member on clause 11? My understanding is that clause 11 has been carried. Does the committee give unanimous consent to returning to clause 11?


Some hon. Members:: Agreed.


Alexander Bell Patterson: I think I was standing when it was declared carried. Subclause 2 of clause 11 refers to any specific programs initiated by the council in relation to any of the objectives set forth in paragraph (a) of subsection 1. I should like to ask two or three questions. Will the activities of the entity or agency within the council be confined solely to functions and activities in relation to clause 11 or will it also operate under subclauses (i) and (j) of clause 9? It would seem that if the council is to do the job it should do it should have the opportunity to operate in both these spheres rather than just in the one. The national productivity council was able to accomplish what it did because it had freedom to act, freedom to apply its programs. It seems as though, in this particular respect, this paragraph removes the consultative effect and makes the work of the economic council a responsibility of the government alone.
I should like to ask some further questions. What is being done to preserve the work of the productivity council, for instance? Why would the programs of the economic council be taken over by a government department?
I should like to call attention to a statement I made back on June 7, 1963, as recorded in Hansard at page 798:
We would suggest that it is of the utmost importance that the work of the economic council be done on a continuing basis with management and with labour and with the other programs rather than just evolving into a civil service operation.
It would seem, Mr. Chairman, that this is what could happen if the government were to take over the operation of these programs to the exclusion of any advice or direction from the economic council. Then, too, it would remove that element of personal contact that had been carried on by the economic council. If these programs were to be taken
Economic Council of Canada over solely by a government agency, this would destroy all the personal contacts that had been established between the council on the one hand and management and labour on the other.
I should like to ask, therefore, why would the programs of the economic council be taken over by a government department? Why are the departments of government interested only in the work under clause 11 and apparently not in the work under clause 9?


Michael Starr: I have the same observations to make in respect to these matters as the hon. member for Fraser Valley. I wonder if the minister would consider standing clause 11 so that we could deal with it at the end of the bill. We have some remarks to make in respect of clause 22 which relates to the work that is referred to in clause 11.


The Deputy Chairman:: Is it agreed that clause 11 stand?


Alexander Bell Patterson: I wonder if I could ask one or two other questions that could possibly be tied in with this matter and dealt with later. There is a word in this clause that seems rather strong. It is the word "shall". The phrase is "... shall, if carried out by the council, be so carried out only until such programs can effectively be continued by other government departments or agencies." I suggest that perhaps it would be advisable for this to be taken under consideration, and be carried on between the government and the economic council. Then if it is mutually agreed it would be desirable to do so, this action could be taken. I feel this word "shall" is a very strong word to be used in this connection.
There is one other thing about which we are rather concerned, and that is any attempt at restricting the programs or operations of the council. We certainly do not want that to happen. We do not want to hamstring the potential effectiveness of the council in any way; therefore, we would like the minister to take this into consideration and reply perhaps when this matter is before us again.


Herman Maxwell Batten: Is it agreed now that clause 11 stand?


J.-H.-Théogène Ricard: Before it stands, Mr. Speaker- (Translation):
I should like to ask the minister a few more questions concerning paragraph (iii) which reads:
-the maintenance of good human relations in industry,
Now, what particular action does the minister intend to take to promote good human relations? When he was preparing this section, did the minister have in mind the Norris report when he drafted the section where it

Economic Council of Canada is said "further promotion of good human relations in industry"?
As far as paragraph (iv) of the same section is concerned, does the minister intend to use that provision to grant more scholarships in the province of Quebec, particularly in forest engineering, for instance, since there is at present a shortage of qualified forest engineers?


Maurice Lamontagne: Mr. Chairman, first of all, in reply to the first question put by the hon. member, I should like to point out to him that the national productivity council arranged with very much success, I understand, some seminars and meetings between industry and representatives of labour unions, with a view to discuss problems common to industry, management and labour. In fact, I think it is precisely that subparagraph (iii) which allowed the productivity council to arrange such meetings which I think could be very fruitful.
As for the second question put by the hon. member, I think it is not the economic council's business to hand out scholarships.


J.-H.-Théogène Ricard: I have a supplementary question, Mr. Chairman. In view of the fact that the minister used the past tense when he said "allowed the council", should we take it that no action is anticipated or planned for the future and that it applies only to the past?


Maurice Lamontagne: I think the hon. member did not quite understand what I said or if he did, maybe I did not express myself properly. I was talking about the activities of the productivity council, which the new council will also undoubtedly carry on, once it is established.
(Text) :


Herman Maxwell Batten: Is it agreed that clause 11 shall stand?


Some hon. Members:: Agreed.
Clause stands.
Clauses 12 to 14 inclusive agreed to.
On clause 15-Appointment of staff.


Alexander Bell Patterson: I wonder if we could have some indication from the minister as to what will happen to the officers of the productivity council and also the staff. Is it the intention to absorb the personnel into the new economic council; are they going to be retired, fired or what is going to happen?


Maurice Lamontagne: Mr. Chairman, this problem has not been discussed, but I hope that

the present staff can be retained and continue its work with the new economic council.


[Stage Direction]
Clause agreed to.
On clause 16-Technical and special advisers.
(Translation):
J.-H.-Théogène Ricard: Mr. Chairman, with respect to clause 16, I should like to ask the minister what standards are to be established to determine the qualifications required of those who will be called upon to assist the minister in his work. What methods will be used to determine the qualifications of candidates applying for a position under that provision of the bill?


Maurice Lamontagne: Mr. Chairman, I do not quite understand the point the hon. member wishes to raise. Perhaps he could explain it to me in greater detail, because I do not think there is any provision to leave such matters to the minister.
The sole purpose of that clause is to enable the council to obtain the services, on a temporary basis, of the experts it may need.


J.-H.-Théogène Ricard: That is precisely what I was asking the minister. How will the qualifications of the experts required be determined? Will this be through civil service competitions or will the selection be specially made by the minister or his representatives? Such is the question I wish to be answered.


Maurice Lamontagne: Mr. Chairman, in my opinion, section 16 explicitly provides that the council may retain the services of experts. In addition, I will point out to the hon. member that section 16 of this bill is in every respect identical to section 17 of the legislation introduced by the previous government during the last session.
In my opinion, it would be advisable that the council might retain the services of experts on a temporary basis and I am convinced that the council itself will establish its own criteria to decide who should be hired and to whom positions should be offered.


J.-H.-Théogène Ricard: Mr. Chairman, as the council may make same recommendations, with the approval of the treasury board, this means that the minister will be the one to take the final decision concerning the hiring of experts?


Maurice Lamontagne: Mr. Chairman, the treasury board will have its say, since this will involve the expenditure of public funds which will be submitted to its approval.

(Text):


[Stage Direction]
Clause agreed to.
Clauses 17 and 18 agreed to.
On clause 19-Appropriations.
Alexander Bell Patterson: I understand that under the legislation governing the national productivity council there was a principle of shared financial responsibility. The amount spent by that council last year was $400,894, and of this about $85,000 was contributed by industry and labour. It now appears that the government is assuming full responsibility for the financing, and I ask would it not be beneficial were provision made for participation by industry, labour and business in order to give them a sense of responsibility?


Maurice Lamontagne: 1 am informed that such a provision was not necessary and that the council is authorized to receive donations and gifts to enable it to do exactly what the national productivity council was doing in cooperation with labour unions and industries.


Alexander Bell Patterson: There will be voluntary contribution but not on a shared basis?


Maurice Lamontagne: Yes, so that this arrangement will be a little more flexible than the one referred to by the hon. member.


[Stage Direction]
Clause agreed to.
Clause 20 agreed to.
On clause 21-Annual report to be made.
Alexander Bell Patterson: This clause states that the chairman of the council will be the only one who will have the responsibility of publishing studies and reports for the use of the council. If the council is to have the responsibility of doing the work, carrying on studies and correlating information, it should also have the privilege of presenting reports to people other than the minister. Labour, industry and the public in general would be very interested in the activities of the council, which should be in a position to provide the fullest access to the information and reports it collects and prepares.


Maurice Lamontagne: My colleague, the Minister of Citizenship and Immigration, is ready to propose an amendment to subclause 3 which would authorize the council to publish, without the approval of the minister, such studies and analyses prepared for the use of the council. This would go a long way to meet the point raised by the hon. member.


Alexander Bell Patterson: Will that include the recommendations, as well as information and reports?
Economic Council of Canada


Maurice Lamontagne: No, Mr. Chairman.


Guy Favreau: I move:
That clause 21 of Bill C-72 be amended by striking out subclause (3) thereof and substituting therefor the following:
(3) The council may cause to be published such studies and reports prepared for the use of the council as it sees fit.


[Stage Direction]
Amendment agreed to.
Alexander Bell Patterson: We appreciate the minister going that far, but we wish he had proposed a clause stating that the recommendations as well would be given to the public.
Clause as amended agreed to.
On clause 22-Repeal.


Michael Starr: This clause has the effect of repealing the National Productivity Council Act, and the reason we asked that clause 11 stand was because it was related and conveys to the economic council the duties of the national productivity council. Subclause 2 of clause 11 provides that projects initiated under subclause 1 will revert to government departments as soon as this can be done. This means the elimination and burial of the national productivity council and its work, first by disbanding it and second by transferring its duties to this new council, with provision for progressive reversion of those duties to various departments of government. But the theme and principle of the productivity council was that it should deal with those problems-and there are a great many of them-which require the co-operation of management and labour; that it should deal with them on the basis of mutual co-operation.
I was very interested indeed in and impressed by the words uttered yesterday in this repect by the parliamentary secretary to the Minister of Veterans Affairs who, if I understood him correctly, looked upon the work of the national productivity council with great favour. He felt, as I am sure do many hon. members, especially the hon. member for Fraser Valley, that the national productivity council certainly made great strides in the field of management and labour cooperation and broke new ground in this area, establishing a principle that has taken hold.
Once these projects revert to a government department, that principle of dual labour-management approach is completely abrogated in favour of a purely departmental approach. This, to my mind, involves such matters as productivity, labour-management relations, automation, training and retraining of workers; in short, a whole area of the industrial complex which can best be served, I submit, by a joint labour-management approach, with government being the recipient of their joint recommendations. Just a few moments

Economic Council of Canada ago an amendment was moved-perhaps I should not refer to that amendment because it was passed-and certain things will only be made public as certain people see fit to make them public. Recommendations are not to be made available to everyone concerned, neither labour nor management. The effect of this clause and the clause that has been stood, No. 11, is to remove these matters from the purview of labour and management in this country and transfer them to the government. I think this is a step backward. The principle we put into effect has taken great strides in the past few years since the inception of the national productivity council and has brought about greater labour-management co-operation in a field in which both these factors are very vitally interested.
Clause 22 removes from existence the only government body which labour and management can meet to deal with problems that are peculiar to labour and management but which nevertheless make their effects felt throughout our whole economy. I submit, Mr. Chairman, that no substitute body should be set up because the duties would be taken over in such a way as to provide for their eventual parcelling out among government departments. I look at this as a process of assassination by attrition. The Liberal party when in opposition did not believe in the productivity council from its inception, and throughout its existence there was nothing but bitter and harsh criticism of the council from members of that party. But I submit it was only a political attack. Although the president of the Canadian Labour Congress, after accepting a position on this council, objected to the make-up of the council because he felt there was not sufficient representation on it from industrial unions, he at no time criticized the principle of labour-management co-operation embodied in the work of the council. Since the inception of the council and the work they have carried out in the labour-management field I am glad to note that he has become one of the greatest supporters of the labour-management principle and is continually advocating more and more of this sort of thing in order to help resolve the difficulties which present themselves in our economy. This bill, and particularly this clause, destroys that whole principle.
I submit, Mr. Chairman, that clause 22 should be deleted from the bill before us, which would have the effect of continuing the productivity council and would eliminate the necessity for the inclusion of clause 11, which should also be deleted. I therefore move:
That clause 11 and clause 22 of Bill No. C-72 be deleted.


Herman Maxwell Batten: Order. The-


John Whitney Pickersgill: Mr. Chairman, I presume that before you put the motion you intend to consider whether it is in fact in order or out of order for two reasons; one, because, of course, the revival of the productivity council as a separate organization would necessarily involve an additional expenditure of public moneys, which only a minister of the crown may propose, and second it would change the whole scheme of the bill and upset the principle of the bill. It seems to me that on both those grounds the motion is out of order.


Michael Starr: On the point of order, Mr. Chairman, may I submit that it will not be a revival of the national productivity council, because if these clauses are not included in the new bill, it would still be in existence. As far as financial obligations with respect to the national productivity council are concerned, a great deal of the expenditure that would be entailed in putting into effect Bill No. C-72 would not be necessary because that expenditure would be absorbed in the national productivity council.


Guy Favreau: Mr. Chairman, as the Secretary of State has suggested, not only does this motion involve the expenditure of money, Ziul Ulll,y does it ujjoet the purpose of the bill, but it is more than an amendment of substance; it places in question the whole purpose of the bill. The purpose of the bill is to repeal the National Productivity Council Act and to create an economic council to which will be transferred the powers of the national productivity council, plus a series of other integrated and very important powers. So the amendment by itself, if accepted, would completely contradict the purpose of the bill and would totally neutralize the effect of the proposed legislation. For that reason it is suggested that the amendment is completely out of order.


Gerald William Baldwin: Mr. Chairman, may I make one or two observations with regard to what has been said; I think the hon. member for Ontario has also dealt with this. Until the National Productivity Council Act is repealed it is a good act in good standing. Consequently there can be no question of there being any expenditure of money which is not already authorized. Second, if you examine the preamble of Bill No. C-72, you find it is an act to provide for the establishment of an economic council of Canada. It is not an act to provide for the repeal of the National Productivity Council Act.


Herman Maxwell Batten: Order. Apart altogether from the statements which have been made by the Secretary of State and the Minister of Citizenship and Immigration, I would have to rule this amendment out of

Economic Council of Canada order on two grounds: first, because if there the responsibility completely out of the hands are those who disagree with this clause, they of the economic council and hand it over to then have an opportunity of voting against a government department, breaking, as I have it; second, because the amendment refers to said, the personal relationship which the a clause that is not now being considered by council has had with business, industry and this committee.	labour.


Michael Starr: I have no alternative but to appeal your ruling, Mr. Chairman.


Herman Maxwell Batten: Before I proceed with the appeal I should like to give the authority for the ruling I have just made. It is citation 398, page 283 of Beauchesne's fourth edition, which says:
An amendment which would produce the same result as if the original motion were simply negatived is out of order.
Therefore, I should like to ask the hon. member for Ontario, in view of that citation, whether he still wishes to appeal the ruling of the Chair.


John George Diefenbaker: Mr. Chairman, might I be permitted to say a word with regard to this amendment which has been moved by the hon. member for Ontario. All of us are most anxious to give an opportunity this afternoon at five o'clock to private members, and an appeal taken at this time would have the effect of rather limiting the hour. That, of course, is not a consideration which affects you but it is one which affects the committee in general. In any event, the opposition would have the same opportunity on third reading, provided third reading is not called until tomorrow, to make the necessary amendment to cover this matter, namely that third reading be not then taken but that the whole matter be referred back to the committee with the direction to take the course suggested by the hon. member for Ontario.


John Whitney Pickersgill: I am sure that if the hon. member for Ontario would accept the excellent suggestion of the Leader of the Opposition, I can give an assurance that the government would not move third reading today, or attempt to move it, and would follow the course suggested by the right hon. gentleman.


Herman Maxwell Batten: Shall clause 22 carry?


Some hon. Members:: Carried.


[Stage Direction]
Clause agreed to.
Herman Maxwell Batten: The committee will now return to the consideration of clause 11.
On clause 11-Additional duties.


Alexander Bell Patterson: Mr. Chairman, I did ask some questions on this clause. I do not want to hold up the bill, but I wonder whether the minister would indicate why he wants to take


Maurice Lamontagne: I think the hon. member reaches the wrong conclusion or gives the wrong interpretation to subclause 2. This subclause has been put there for one purpose only, and that is to try to minimize duplication. Also, we do not want the economic council to be involved in continuing specific programs which can be carried on by government departments. I think this is exactly the kind of provision we need if we want to avoid duplication in the government service. The subclause is not intended to limit the power of the council to initiate programs or studies, and I think it would be wrong to expect the council to carry on specific programs on a permanent basis. When a program has been initiated and tested and it is realized that it should be continued, then we feel that this specific program should be transferred to the government department which is responsible in that general field. Let us take for instance, the training programs that the productivity council initiated within the last year or so very successfully. I do not think that the economic council or the national productivity council should carry on those programs on a continuing or permanent basis. If such training programs prove to be useful, then they should be transferred from the economic council or the national productivity council to the Department of Labour, which is equipped to do exactly that kind of job.


Alexander Bell Patterson: I wonder whether the
economic council would have the privilege to review the progress of these projects and then take further advice from the council?


Maurice Lamontagne: As a result of the amendment moved yesterday afternoon the council would certainly have the power of review.
Clause 11 agreed to.


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


John Whitney Pickersgill: Next sitting of the house.
Before you see five o'clock, Mr. Speaker, I wonder if it could be understood that the house would resume at seven o'clock. It is August 1, which I think all of us had forgotten. If there could be general agreement, the house could resume at seven o'clock and at that time the Minister of Finance would move second reading of the municipal development and loan bill.

Divorce Bill


Some hon. Members:: Agreed.


Mr. Deputy Speaker:: It being five o'clock, the house will now proceed to private members' business, pursuant to special order made this day.



DIVORCE


[Stage Direction]
Mr. Eric A. Winkler (Grey-Bruce), for Mr. Mandziuk, moved the second reading of Bill No. C-93, authorizing the Senate of Canada to dissolve or annul marriages.
He said: It is my honour to present Bill No. C-93 standing in the name my hon. friend from Marquette (Mr. Mandziuk) by and with his consent. I would say in explanation that the purpose of the bill is to provide that the Senate may on petition by resolution declare that a marriage is dissolved or annulled as the case may be. The operation of the resolution may be suspended if, before the expiration of 30 days from the adoption of the resolution, a petition to parliament by either party together with a draft bill is filed with the clerk of the parliaments.
It is not, of course, within my competence to deal with this matter as my hon. friend from Marquette would have done, but I understand there is fairly general agreement with regard to this measure and it would be a historic step if this house could, today, in the course of this private members' hour, see fit to give the second and third readings to the bill which is before us.
Mr. Arnold Peiers (Timiskaming):: 
Horace Andrew (Bud) Olson: Mr. Speaker, on behalf of this group I wish to say we have discussed the bill and its provisions and we agree that it can go through all stages this afternoon. I want to say that over the years members of this party, together with all other members of the house, have considered that the manner in which divorce cases were presented to us was one of the most distasteful parts of our responsibilities. I recognize at the same time, however, that members of parliament must occasionally face up to distasteful responsibilities.
I think there has been fairly unanimous agreement that one of the most objectionable features of the way in which divorce bills have been handled is that many times in the house and in the private bills committee members have been asked to give blanket, unanimous approval to certain things and they really did not know what they were voting for. As has been pointed out, there were times when we might have had some reservations about giving approval to certain petitions, but at the same time there did not seem to be any other course open to us than to pass them en bloc, and perhaps try
Divorce Bill
to absolve ourselves of some of the responsibility because they went through in that fashion.
I wish to offer our congratulations to the members of the house who have come up with what might be called a compromise solution. We are not suggesting that this is the final or best solution that can be found but certainly we are willing to give it a try. As I said, we in this party will allow the bill to pass all stages today.


Gordon Minto Churchill: Mr. Speaker, I will not delay the house many minutes but I was so involved in this problem for a number of years that I should like to say a word or two about it.
I should like to pay a compliment to the hon. member for Marquette (Mr. Mandziuk) for his activity in this connection last year and again on this occasion, and to two former members of the house who are no longer with us, Mr. Robert McCleave of Halifax and Mr. Doug Morton of Toronto, who worked many long hours attempting to arrive at a solution to this very vexing problem.
The problem has been recognized by all members of the house for many years, and a very great effort was made, involving the expenditure of many hours of time in attempting to reach a solution to the problem, one which has escaped solution for a very long period of Canada's history. There were several occasions on which two or three of us representing the various parties in the house conferred with Mr. Speaker Michener about the problem. Some members of the house conferred with members of the other place. A great deal of work was done in that way in order to achieve success.
Two years ago a bill almost identical to this one was passed by this chamber with the co-operation of all hon. members but it failed to receive approval in the other place. Now we have finally arrived at the stage where agreement has been reached. Certain additions have been made in this bill which have provided for valid objections raised on other occasions. I hope there will be general agreement to the passing of the bill and thus removing a very contentious problem from this chamber.
At the same time we will have to push into the background and forget some of the controversy we have had in this chamber with regard to methods that were used to promote the idea of a change in procedure with respect to divorce. The great thing today is that we now have an achievement which I think will be creditable to parliament.


Thomas Clement (Tommy) Douglas: Mr. Speaker, if this bill is passed by the house and is also passed by the Senate it

Divorce Bill
will constitute a red letter day in the life of the Canadian parliament. Over the past quarter of a century many of us had hoped that the day would come when a more satisfactory way would be found to handle divorces coming from the provinces of Quebec and Newfoundland. Many of us have felt for a long time that parliament neither has the facilities nor the skill to deal with the question of divorce. We do not have the facilities to make proper investigations. We do not have the facilities to decide whether or not proper custody of the children is being awarded and proper provision being made for the parties affected.
I rose simply for the purpose, first of all, of extending congratulations and paying my tribute to the hon. member for Timiskaming (Mr. Peters) and the hon. member for Skeena (Mr. Howard) who have fought this question for a long period of years. They have often suffered misunderstanding as a result, but I am sure they will be satisfied today. I am also sure that members of parliament in all parts of the house will be happy that an improved method has been found to handle divorces.
This is bv no means the end of the road. There are other things that should be done. We in this party have always felt that the exchequer court was the proper court to handle divorces, but that may be a future development from the step we are now taking. I also want to pay tribute to the hon. member for Marquette (Mr. Mandziuk) who has worked very assiduously on this subject, and to congratulate him and the hon. member for Grey-Bruce (Mr. Winkler) who has brought the bill before the house today on behalf of the member for Marquette. I think members of the house in all parties who have worked together to find a solution will feel a great sense of gratification that we have now reached an important milestone in the history of the Canadian parliament. I think also it will be a great relief to many of the people who have been affected by this legislation.


Mr. Reid Scott (Danforth):: I just want to say one or two words on this measure. I realize that a great deal of work and cooperation has gone into the preparation of the measure and the method by which it has been brought here this afternoon. It is a source of great personal regret to me, however, that in reading this bill I see that on August 1, 1963, we are creating a process for administering the laws of England in respect of marriage and divorce as of July 15, 1870. We have had previous discussions in the house concerning the necessity for broadening the general grounds for divorce. It is a source of personal loss to me that

we are here merely perpetuating the archaic and backward divorce laws that exist in this country. I hope that some day we will be able to deal with this subject.
I realize there are a lot of problems involved, religious difficulties and personal belief. However, this does not alter the fact that thousands and thousands of Canadian citizens are living under extremely harsh and difficult circumstances because of the archaic nature of the divorce laws of this country. I hope that some day we will be able to drag the divorce laws, kicking and screaming, into the twentieth century. This is, of course, a step in the right direction. No one would wish in any way to oppose it or detract from the importance of the measure we are passing. I could not permit it to pass without registering my personal objection.
(Translation):


Mr. Gerard Girouard (Labelle):: Mr. Speaker, I should like to say only a few words on this bill because I do not intend to oppose it.
A satisfactory compromise has been found since the house had no desire to deal with the matter. However, what surprises me is that the whole matter will finally fall into the hands of the Senate, of people who will be called upon to rule on marriage and whose decision will be final.
I appreciate that the house has found a compromise solution, and all I want to say now is that I wish the house would spend as much time, energy and money to find a way to patch up unsuccessful marriages instead of giving further encouragement to divorce. (Text):


John Whitney Pickersgill: I feel that there should be a word said from this side of the house. I want to say first that I feel the spirit in which this legislation has been put forward today, and the way in which every member of the house has to some degree made a compromise, is an indication that under our democratic system we can do the things that need to be done.


Mr. Deputy Speaker:: Order; it will be understood that if the hon. member speaks now he will be closing the debate.


Eric Alfred Winkler: I appreciate the co-operation that has been displayed. I assure you, Mr. Speaker, and all the members present that I do not wish or intend to take credit for the presentation of this measure today or for the terms in which the measure is placed before us. This goes to several members of the house, some of whom are here and some unavoidably absent. I

include, particularly, the hon. member for Timiskaming (Mr. Peters) who has seen fit to agree to the terms of the measure. As one of the members of his party said, perhaps it is not ideal, but it is a common denominator that we come out with in this chamber for the benefit of the whole. I would take this opportunity of thanking every individual who has made this possible this afternoon.


[Stage Direction]
Motion agreed to, bill read the second time, considered in committee and reported.
Mr. Deputy Speaker:: When shall the said bill be read a third time?


John Whitney Pickersgill: Now, by leave.


Eric Alfred Winkler: the third reading of the bill.
Motion agreed to and bill read the third time and passed.



PRIVATE BILLS

Ian Grant Wahn: Mr. Speaker, may I move that Bills SD-1 to SD-50 be referred to the committee en bloc?


William Arnold Peters: We have agreed, Mr. Speaker, that no further consideration will be given to these bills. The committee has decided that the people are prepared to go ahead with their cases according to certain affidavits. Some of these cases are rather lengthy. Unfortunately, however, they have become badly mixed.
I should like to ask the chairman of the private bills committee if he will hold out two bills which I consider are in a separate category. I refer to the bill concerning Mrs. Barmash, which is being contested for the third time, I believe. The second bill relates to a person named Hankowski. This case was referred to a few days ago. There is a problem of domicile involved as between three countries and this case wants special consideration. In addition, there is the fact that counsel in this particular case do not appear to have been advised in the regular manner. It is not really known whether or not there is a protest on behalf of the respondent.
With the exception of these two cases, Mr. Speaker, that I should like dealt with separately, the Hankowski case which is Bill No. SD-5 on the order paper-


Mr. Deputy Speaker:: It would be helpful if the hon. member could give us the numbers of the bills to which he is referring. Bill SD-5 is on the order paper today. We added another 200 and I am not sure what the number of the Barmash case is because it is changed from what it was previously.
Perhaps I might suggest to the hon. member that we will try to sort this out in committee.
Private Bills


Ian Grant Wahn: That Mr. Speaker do now leave the chair for the house to go into committee of the whole on private bills SD-1 to SD-251, both inclusive, with the two exceptions referred to by the hon. member for Timiskaming (Mr. Peters) pursuant to section 1 of standing order 54.


Mr. Deputy Speaker:: Is it the pleasure of the house to adopt the motion?
Motion agreed to and the house went into committee on Bills SD-1 to SD-251, (with the two exceptions indicated)-Mr. Wahn-Mr. Lamoureux in the chair.
On clauses 1.


Gordon Harvey Aiken: Are we going to go through the bills one by one?


Lucien Lamoureux: My understanding is that we are calling clause 1 of all the bills and then their preambles.


Gordon Harvey Aiken: Of all the bills except the two-


Lucien Lamoureux: Except the two that have to be sorted out, which we have to determine or identify.


Reid Scott: How are we going to handle the problem raised by the hon. member for Timiskaming with regard to the two bills, if we are going to carry them all simultaneously?


Lucien Lamoureux: They have been specifically excluded by the Chair, without naming them, because we will have to go through quite a number before we are able to identify the two bills specifically referred to by the hon. member for Timiskaming.


Stanley Howard Knowles: The hon. member for Timiskaming has cut your problem in half. One of the bills is readily identifiable. It is order No. 6 but the other you will have to find somewhere.


Gordon Harvey Aiken: I think the hon. member for Timiskaming will find that the numbers of of the bills are in Votes and Proceedings for yesterday, July 31, at page 315 and onward. I think, to put this in proper shape, we ought to identify the bill numbers and withdraw those two bills from consideration.


William Arnold Peters: The Hankowski case is SD-5 now, and in the previous year it was SD-1. No. 3 or 4 was 90, and there is no continuity between this year and previous years.


Gordon Harvey Aiken: May I ask the hon. member what the name of the party is?


William Arnold Peters: B-a-r-m-a-s-h.


John Whitney Pickersgill: Surely it is sufficiently identified so that it can be sorted out at the table.


Lucien Lamoureux: In any event my understanding is that the two bills, identified to the

Private Bills
extent that they were named by the hon. member, were excluded from consideration of the committee. We have further identified one of them, Bill SD-5, and we have the name of the other one which has just been recorded on Hansard by the hon. member.


Robert Gordon Lee Fairweather: I am not going to take more than about two minutes. I just want to say that because of the very wonderful compromise that has been made, we are about to consider these bills, and I want to say that I share two points of view. The first one is about custody of children. This has troubled me ever since I came to this place, and I have been rather astounded to note that we could dissolve a marriage and pay no attention whatsoever to the custody of the children. That is something I wish to put on the record.
Second, I want to agree, with a fervent amen-perhaps this is out of order, but it will not take me long enough to worry about it being out of order-with the statement made about the narrowness of grounds for the dissolution of marriage. They are surely archaic in Canada in 1963.


Lucien Lamoureux: Shall clauses 1 of the said
uixia	:
Clauses 1 agreed to.


[Stage Direction]
Preambles agreed to.
Lucien Lamoureux: Shall I report the said bills?


Gordon Minto Churchill: May I ask a question? Perhaps this is out of order, but what about the ones now in Votes and Proceedings for July 31? Are they going to come before the house before the adjournment?


John Whitney Pickersgill: There was a motion made earlier today and they are now before the house. I would like to have that confirmed by the chairman of the committee.


Ian Grant Wahn: Bills SD-1 to SD-251, with the exception of the two bills mentioned by the hon. member for Timiskaming, are before the house.


Gordon Harvey Aiken: Mr. Chairman, so far as I can gather the second bill mentioned by the hon. member for Timiskaming is not included in this group.


Mr. Ryan:: It is important that the motion affect only one rather than two bills. I cannot find the Barmash bill.


John Whitney Pickersgill: If it is not included then it cannot be excluded.


Lucien Lamoureux: Shall I report the said bills?


Some hon. Members:: Agreed.
Bills reported and read the third time and passed.
[The Chairman.]



BUSINESS OF THE HOUSE

John Whitney Pickersgill: Mr. Speaker, before another order is called I wonder if the house would permit me, in order to have it recorded on today's Hansard, to give the information which the Speaker asked about the questions that were to be dropped pursuant to the intervention of the hon. member for Lapointe (Mr. Gregoire). They are Nos. 506 to 556; 651 to 662; 708 to 737, and 892 to 898 all inclusive. I will send this to the table so that it will be properly recorded. I am most grateful to the house for permitting me to do this.


Mr. Depuiy Speaker:: Is that agreed?


Some hon. Members:: Agreed.


Ian Grant Wahn: Will Bill SD-5 now be dealt with-the one that has been excluded?


Mr. Deputy Speaker:: Order. Is it agreed by the house that there is only one bill, SD-5, which will be excluded from the several bills that have been approved by the house?


Some hon. Members:: Agreed.


Gordon Harvey Aiken: Are we going to deal with Bill SD-5, or is it to stand?


An hon. Member:: Let it stand.


Mr. Deputy Speaker:: It is agreed that bill SD-5 stands.
Bill stands.



PRIVATE BILLS


[Stage Direction]
Bill No. S-29 respecting The Sovereign Life Assurance Company of Canada-Mrs. Konantz.


Ian Grant Wahn: Mr. Speaker, by unanimous consent I move, seconded by Mr. Addison:
That the following bills be now read a second time and be referred for consideration forthwith, notwithstanding provisions of standing order 106, by (a) the standing committee on banking and commerce: Bill No. S-26, respecting Co-operative Fire and Casualty Company; Bill No. S-30, respecting the Monarch Life Assurance Company; Bill No. S-35, respecting the Crown Life Insurance Company.
(b) Standing committee on miscellaneous private bills: Bill No. S-31, respecting the Canadian Manufacturers' Association.


Mr. Deputy Speaker:: Is it the pleasure of the house to adopt the motion?


Mr. T. S. Barnett (Comox-Alberni):: Mr. Speaker, I would like to know first of all whether the proposal of this motion means we will not be free at this time to say anything in respect of any of these bills that are being moved for second reading and referral.


Mr. Depuly Speaker:: The understanding is that hon. members will have an opportunity to consider and discuss these bills.


Thomas Speakman Barnett: I rise, Mr, Speaker, simply for the purpose of saying a word or two about Bill No. S-26, respecting the Co-operative Fire and Casualty Company. I am speaking in support of the bill but I would like to say a word or two about my own reaction to the method of dealing with this matter. I think it is rather unfortunate that a bill of this particular kind has to come before this house, because in my view it represents the necessity of the co-operative movement of Canada taking a rather roundabout and back way in order to achieve their purpose of maintaining the democratic nature of this particular operation.
My own view is that it would have been much more preferable had it been possible for the Co-operative Fire and Casualty Company to have proceeded with what I understand was the original idea a number of years ago, that is, operating their concern in the normal co-operative manner through some provision for a delegate convention. I think it is rather important that we realize in this house that the purpose of this bill, as I understand it, is to ensure that the co-operative and democratic method of control shall be maintained in respect of this organization. While I regret that circumstances make it appear that this is the only manner in which that object can be achieved, nevertheless I feel we should support the desire of the cooperative movement to ensure that in the future their operations shall continue to be run in a truly democratic manner.


Mr. D. G. Hahn (Broadview):: Mr. Speaker, perhaps I may just say a few brief words and make a few comments on the remarks of the hon. member who has just spoken. One of the reasons for the change in this company from a mutual company to a joint stock company is that of financing. This company was originally incorporated as a co-op company. The original capital was loan capital and was intended to be loan capital. Originally, in 1951, it was $200,000. The people and the co-ops which advanced these funds had no control in the operation of the company. In the intervening years it has been necessary to put more money into the company because its business has grown to a total now of nearly $1,300,000. More capital is going to be required. One of the reasons for changing the structure of the company is to take note of the fact that this capital is no longer loan capital; it is permanent capital. Therefore the co-operatives which have advanced the capital are now going to have an
Private Bills
opportunity to participate in the management of the company through the stock operation.
Motion agreed to and bills read the second time.


Mr. Deputy Speaker:: The said bills now stand referred to standing committees as specified in the motion.



ALLSTATE LIFE INSURANCE COMPANY OF CANADA

[Stage Direction]
The house resumed from Thursday, July 25, consideration of the motion of Mr. Ryan for the second reading of Bill No. S-28, to incorporate Allstate Life Insurance Company of Canada.
Mr. Deputy Speaker:: Is the house ready for the question?


Some hon. Members:: Question.


Gilles Grégoire: What is the question?


Mr. Deputy Speaker:: Moved by Mr. Ryan, seconded by Mrs. Konantz:
That Bill No. S-28, to incorporate Allstate Life Insurance Company of Canada be now read a second time.


Some hon. Members:: No.
(Translation):


Mr. Gerard Laprise (Chapleau):: Mr. Speaker, I am astonished to see this bill before the house for the third time.
On July 18 last, this bill was presented and one of my colleagues, the hon. member for Lapointe (Mr. Gregoire), indicated to the house, in strong terms, the reasons why we objected to the passing of this private bill.
We are asked, as it were, to welcome a new insurance company. The Allstate Life Insurance Company of Canada is not going to invest capital in Canada; on the contrary, it will take further profits out of the country.
Mr. Speaker, if in my turn I object tonight to the passing of this bill, following the example of my colleagues from Lapointe and from Lake St. John (Mr. Lessard) who objected to it also last Thursday, it is because I am of the opinion that in Canada there are several insurance companies which give us adequate coverage.
I cannot see why a company owned almost entirely by foreigners, by Americans, should be accepted, when there are in Canada insurance companies that give us very good coverage in a very satisfactory way.
There are in Canada a great number of insurance companies and competition is so

Private Bills
fierce that there is no need to take a step to take out a policy; insurance salesmen are always after us, offering us the coverage that our own Canadian companies can give us.
Mr. Speaker, that is why I am against the passage of this private bill; we have here in Canada insurance companies that are doing very well. From a Canadian standpoint, in every field, we are doing rather well. We have succeeded in industry.
This bill will not create more employment, as another member stated in this house. There is no question of coming here to give employment, but rather to get benefits.
Mr. Speaker, as I said earlier, our people have done well in the insurance business as in any other field. I am of the opinion that we need not look elsewhere to find what we want.
Let us take hockey for instance. We are doing rather well in Canada in that sport. It is the same in industry and also in the field of insurance.
Our Canadian insurance companies have given proof of their success a long time ago. I am sure that they can continue to give us the protection we need in the field of life insurance as well as in that of fire, theft or automobile insurance. In his budget speech, the Minister of Finance (Mr. Gordon) told us that nearly 70 per cent of Canadian trade and Canadian industry were in foreign hands. Today, we are asked to pass another piece of legislation which would increase foreign ownership of our insurance business.
Mr. Speaker, I wish to tell the house that I object to the passing of this measure as it stands, for I feel-and I wish to make this feeling widely known-that there are enough people in Canada capable of giving us all the protection we need.
We are not anti-American. That is not at all the case. But, once again, we can find in Canada all the coverage we need in the insurance field.


Gérard Girouard: Mr. Speaker, I wonder why we are still discussing this bill today, for after having heard the hon. member for Lapointe (Mr. Gregoire) and the hon. member for Lake St. John (Mr. Lessard), who have their own way of making themselves understood, one would think that the
[Mr. Laprise.l
sponsor of the bill would have understood immediately and would have withdrawn the bill.
But it seems that the learned member for Lapointe has been preaching to deaf ears and that the young members will now have to do the same and to preach still louder to the wind.
It was proposed that that bill be referred to the banking and commerce committee for detailed consideration. At that time, the mover of the bill stated that it would be easy for the committee to question the directors of the company and obtain the necessary information. What amazes me is that more than a week later the same mover comes back with the same bill and believes that we can do without the few explanations we wanted to have. In any case, we are wondering what kind of explanations we would have been given since it was clearly stated in the house that this company is largely American.
I find it strange that some members talked in the house about anti-Americanism, but I wish to emphasize that that is not the question. In fact, we are not concerned about American capital but about Canadian capital flowing out of the country to the United States. That is why I have to object to the bill.
It was said earlier that the budget introduced by the Minister of Finance (Mr. Gordon) contained an item the effect of which was to prevent new Canadian capital from falling into the hands of American companies. Now, the bill before us provides for the take-over of a Canadian company by Americans who will come into this country to compete with our Canadian companies.
Therefore, it is the responsibility of the members of this house to look after Canadian capital. Why does the mover introduce such a bill when we have in Canada a sufficient number of insurance companies giving us all the services we need? We really do not see how Canadians would benefit from the establishment of a new insurance company.
That is why I humbly agree with the ideas so brilliantly expressed by my colleagues who are opposed to the passing of this bill. However, I would like to make a suggestion to the mover of the bill who wants us to refer it to the committee on banking and commerce. I would suggest that he, who should know the director of the company very well, encourage the latter to draft a bill during the adjournment, which would be acceptable to the members of the house. The company

might, for instance, decide to have a greater number of Canadian directors, so that it would be 50 per cent Canadian.
(Text):


Sylvester Perry Ryan: Mr. Speaker, I rise on a question of privilege. I should just like to deny that I know any one of these directors of these companies. I have had no personal acquaintance with any of them.
(Translation):


Gérard Girouard: In that case, Mr. Speaker, I apologize if my words implied that he would know some of the company's directors. I would nevertheless ask him whether he could not find an opportunity of meeting some of those directors and tell them the reason for our opposing the bill, which is that we would not like entirely American capital to compete with our Canadian companies in a field in which there is already too much competition. If the hon. member would make some representations to those American people, I think that the bill might be accepted later. Otherwise, I do not see how we could accept it, for we did not get the explanation we wanted.
Mr. Speaker, may I call it six o'clock? (Text):


Mr. Deputy Speaker:: Order. The hour appointed for the consideration of private members' business having expired, the house will now revert to government business.
It being six o'clock I do now leave the Chair, and may I remind hon. members that the house will sit again this evening at seven o'clock.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 7 p.m.


Walter Lockhart Gordon: the second reading of Bill No. C-76, to promote increased employment in Canada by financial assistance by way of loans to municipalities to enable municipalities to augment or to accelerate municipal capital works programs.


John George Diefenbaker: Is the Minister of Finance not going to make a statement?


Walter Lockhart Gordon: In speaking to the resolution in the house on June 11 and in reply to the debate on the resolution on June 17, I set
Municipal Development and Loan Board forth the purposes of the municipal development and loan act and explained the manner in which it would contribute to employment.
While the financial assistance given in this legislation will help municipalities to build capital works, it must be remembered that the primary purpose is to give employment. This we hope to accomplish by increasing the level of municipal capital expenditure over the next two or three years, that is, up to March 31, 1966 which is the terminal date specified in the bill.
The speeding up of municipal capital expenditure is to be accomplished by making loans available to municipalities on favourable terms. A municipal loan fund of $400 million will be established for this purpose. The money will be available to the municipalities for financing additional capital projects and the interest rate will be the government's own long term rate plus not more than one quarter of 1 per cent administrative overhead charges. To provide an added incentive for a rapid increase in municipal capital spending, the government will forgive one quarter of the loan made with respect to the increased capital spending before March 31, 1966. This, of course, is the equivalent of a major reduction in the rate of interest on the full amount of the loan.
I should like to repeat that. There are two ways of providing money for this particular purpose on a basis that will be attractive to the municipalities. One would be at a reduced interest rate. The other is the one proposed in this bill which provides for a substantial forgiveness feature of part of the capital. They both have the same effect.
This then is the broad outline of the program: A fund of $400 million available to finance additional municipal capital expenditures up to March 31, 1966, an interest rate on loans equal to the federal long term rate plus a moderate overhead charge, and a 25 per cent forgiveness of the amount of the loan made with respect to work completed up to March 31, 1966.
The whole plan is designed to make a substantial contribution to employment in the coming winter and over the next two or three years. The main purpose of the plan, to increase employment by the above means, has been endorsed by the provinces, and I might say it has been endorsed by all of the provinces. This is demonstrated by the joint communique issued at the conclusion of the meeting on July 26 and 27 with the provinces, which began as follows:
The meeting of federal and provincial governments has concluded with full agreement on the proposal of the federal government to promote employment by financial assistance, with provincial approval and co-operation, to municipal capital works.
2908	HOUSE OF
Municipal Development and Loan Board
As a result of the meeting with the provinces last week end I will propose certain changes in the legislation which have to do with the method of administration and with the breadth of the program. The Prime Minister (Mr. Pearson) has already referred to the excellent results of the conference. Speaking in the house on July 29 he referred to the very satisfactory agreement reached between the federal government and the provinces. He pointed out that the conference with the provinces had accomplished all that it could of itself accomplish. It produced a very satisfactory understanding with the provincial governments about the recommendations the federal government would make to parliament concerning the municipal development and loan bill.
The modifications in which the provinces were particularly interested were of two kinds, and the proposals that we will make to parliament in this connection are summarized in the communique to which I have already referred. The first point has to do with the scope of the program and I should like to quote the communique on this point as follows:
The federal government indicated to the provinces that it will propose, in the legislation to be discussed in parliament next week, features which will enable the measure to be applied in forms adapted to different conditions in the various provinces. The federal government will propose that the range of municipal works covered in the program will be broadened so as to include in any province all those municipal works which the province and the federal government believe to be productive of increased employment.
It was clear from our discussions with the provincial representatives that they felt that broadening the range of programs to which the municipal development and loan bill would apply would make possible a greater contribution to employment and would make for a fairer division of the assistance as between municipalities. Since the government is concerned with achieving the full effect from an employment standpoint and since we are also concerned that the program should be a fair and equitable one from the standpoint of the provinces and the municipalities, we will be proposing an amendment to broaden the list of municipal projects which will be eligible for assistance, provided, of course, that they are additional municipal capital works which will provide additional employment over what we would have had without this plan.
The second modification with respect to administration was also outlined in the communique and I should like to quote the pertinent paragraph:
In response to suggestions from a majority of the provinces-


And, I might say, concurred in by all the provinces.
-the federal government will also propose that, if a province so wishes, it will be able to make with the proposed municipal development and loan board an agreement whereby the province is responsible for granting and administering the loans to municipalities, subject to such safeguards as are necessary to enable the board to report to parliament that expenditures have been properly made according to the purposes of the legislation.
This will give the provinces the broadest possible participation in the administration of the program consistent with the responsibility which the federal board must have to parliament.
The changes with respect to the scope of the program, that is, with respect to the types of municipal projects which will be eligible under the program, and the change with respect to the administrative arrangements by which the provinces can enter into an agreement to administer the loan assistance themselves, have the enthusiastic support of the provinces. In addition, we shall be proposing a change that will ensure that a disproportionate share of the $400 million loan fund will not go to some provinces because tbey are in a nosition to rapidly with certain projects. We will meet this point by proposing an allocation of the fund in proportion to the population of each of the provinces. I might say that this was also enthusiastically endorsed by the provinces last week end.


Michael Starr: Proposed by them.


Walter Lockhart Gordon: No. The hon. member interjects to suggest that this particular point was proposed by the provinces. It was not. It was proposed by the Prime Minister. I think it will not be useful to dwell any further on the detail of these changes. The hon. member seems to be looking a little sceptical and perhaps I should say another word. It was proposed by the Prime Minister in his opening statement at the conference.


John George Diefenbaker: Following criticism by various provincial ministers.


Walter Lockhart Gordon: I did not quite catch the remark of the Leader of the Opposition.


John George Diefenbaker: Is it not a fact that various provinces took objection even before the conference and the change was made following their objections?


Walter Lockhart Gordon: I do not know anything about that, Mr. Speaker, but I do know that this particular change was initiated by the federal government. I think it will not be useful at the moment to dwell any further on the detail of these changes which will, of course, be presented in the form of amendments to

be moved at the committee stage. They do not affect the general purpose and policy expressed in the bill which we are now considering on second reading. Since these changes will have the full support of the provinces they will be a further assurance of success of the proposed legislation in making a substantial contribution to employment.
With this provincial co-operation confirmed and assured I hope that parliament will deal with the legislation expeditiously. We will then be able to have the plan in operation prior to the onset of the coming winter. In this way the stimulus of the plan will be brought to bear at an early date and winter unemployment reduced. In addition, and most important, municipalities will be in a better position to plan the acceleration of their works programs for next year. This municipal development and loan fund is a short term measure to contribute to employment in the near future. We want, and when I say this I am sure I speak for all members of the house, the maximum numbers of jobs at an early date. We want a general stimulus of expansion, income and production which these new jobs will create. The early passage of this legislation seems to me one of the best ways of achieving these results.


John George Diefenbaker: Mr. Speaker, the remarks of the Minister of Finance (Mr. Gordon), in which he has set forth in some detail the changes in the original plan as embodied in the resolution with which this house dealt in June, indicate the degree to which the plan of that date has been changed and altered to an almost unrecognizable degree following the meeting of the dominion-provincial representatives. Indeed, the changes are of such a wide, comprehensive nature that I suggest the minister secure the opinion of the law officers of the crown to determine whether or not the second reading of this bill, changed as I said earlier almost beyond recognition, will require that the matter be brought before His Excellency so that the minister will say, as he must say in respect of all new expenditures:
His Excellency the Governor General, having been informed of the subject matter of this resolution, recommends it to the consideration of the house.


Walter Lockhart Gordon: If the Leader of the Opposition is asking me a question-


Mr. Deputy Speaker:: Order; the Leader of the Opposition has the floor.


Walter Lockhart Gordon: It seemed to me he was putting this in the form of a question, and I will be glad to answer it.


John George Diefenbaker: The minister should know we are not in committee.
Municipal Development and Loan Board


Walter Lockhart Gordon: I thought you were asking me a question.


John George Diefenbaker: Having exhausted his right to speak, the minister can answer later.
I ask him this question now because the opinion has been given by those who are not unconversant with parliament, that it is very doubtful if the bill in its present form, without the introduction of another resolution and the former one withdrawn, will actually conform to the practices and procedures of parliament. We have had experience in that regard in the past. I raise that point by way of general introduction, and then I pass on. The minister will have an opportunity when he sums up to inform the house whether the opinion of the law officers in this regard has been secured.
The minister spoke of the enthusiastic reception that was given by the province. It was not an enthusiastic reception of what the government presented to the provinces, for by the time the provinces got through with the plan that had been presented to parliament the changes and alterations resulted in this plan, which in its original form did not have regard for the rights and responsibilities of the provinces, being different from the legislative plan which had been placed before parliament. We suggested to begin with that there should be consultation with the provinces before action was taken. The government rushed in and bull-headedly presented a resolution and a bill. Having done so, having engendered opposition in all parts of Canada from the provinces, it then convened a meeting of the provinces to consult with them. If ever there was a case of putting the cart before the horse, this was one. We asked for that and we received no favourable reception to our suggestion of the need for full consultation.
Second, having taken the stand we asked what means the government would take to raise the amount in question. As yet, we have not heard about that. We will no doubt find out as the amendments are unveiled, what safeguards have been provided for the spending of this amount. These are things that we should have known. The minister says that what took place was an enthusiastic reception by the provinces. Why would there not be? The provinces simply took the skeleton idea of the government, divested it of most of its flesh and blood, put their own flesh and blood on it and the government of Canada said, that is all right with us. Certainly if ever there was consultation in which the provinces dictated what should take place and the federal government accepted that dictation, this was the occasion.

Municipal Development and Loan Board
All the provincial premiers gave approval. Why would they not? They got everything they wanted. They got $400 million. They got the forgiveness provision. They will have the right to spend practically as they wish in the municipalities, subject to whatever control may yet be revealed. It is a wonderful thing so far as the provinces are concerned. It is everything for which they could ask. How different were the provisions of the communique from the provisions of the resolution which was presented to parliament? Naturally, the provinces agreed with avidity. They accepted with enthusiasm. They will be in a position where they can, in the widely extended scope of the legislation, cover a wide variety of municipal expenditures which otherwise would not have taken place.
The scheme now presented bears little or no relationship to the original. In that connection I refer to the Prime Minister's glowing words to the Federation of Mayors and Municipalities on May 29. The resolution and the bill bear but a casual relationship to the promise that was made to the federation of mayors. This plan bears little or no relationship to anything proposed by the Liberals in the election. It now resembles tbs wintsr works program of the former government. They went all the way around and came back to the position we had taken in regard to this question on the winter works program.
The federal government produced its plan and then the provinces rebelled against it. I use that word in the sense that they remonstrated with fervour, and the government, following a pattern familiar in this session of parliament, retreated. It was not because this plan had not been thought of previously. Members of the government had been talking about it for the last several years and had it in mind ever since "Troubled Canada" was produced. I shall later refer to the plan put forward by the Minister of Finance in that famous work, because it bears very little resemblance to the present one.
The reaction of Premier Lesage to the original plan was so violent that the Prime Minister had to send a squad of ministers to appease him. What about the general plan? Is it going to provide employment? There was very little reference to the numbers, but what about employment this coming winter?
The minister said the plan of the government is to stimulate employment, but then the government plastered the tax on building materials and production machinery, which can only have the effect of stifling the expanding economy which we left when we gave up office. In addition the government has cut the winter works program.
[Mr. Dlefenbaker.l
It was interesting today to listen to one of the ministers say he did not want to predict what would happen in the days ahead, but there was an opinion given that the sales tax on building materials would not have a serious detrimental effect on expansion. The government wants to provide employment, but it has cut back the winter municipal works program by shortening the period by six weeks. That will mean an additional 20,000 persons placed on the unemployment roles at a critical period of the year, and it will require some other plan to take up the slack.
Last year, for an estimated expenditure of $400 million from federal, provincial and municipal sources, approximately 200,000 jobs were provided, and about 145,000 of these were during the 28 weeks of the program. As I say that program is to be six weeks, or 20 per cent, shorter this year.
Will it provide jobs this coming winter? I hope it does. The minister said that is the purpose and if it were passed quickly by parliament then the plans can be made and implemented. However, in his budget speech on June 13, the minister, referring to the of the loan, said in offopt +v*q+ plan should begin to make an impression within six months to a year from the time parliament approved the legislation contemplated.
Now, Mr. Speaker, what was the plan in "Troubled Canada," because after all the period of gestation began at the time that book was produced. At page 108 of that famous work the following statement appears:
If $500 million could be spent in connection with municipal programs of this kind within a single year it should result in providing perhaps 100,000 new jobs.
What a difference there is between the plan of today and the plan in the book. The present plan provides for $400 million, $100 million less, not to be spent in one year but over three years, and I would like to have some projection as to the jobs that will be produced.
According to the minister's own statement the program will not apply with any degree of effectiveness in a comprehensive measure on next winter's employment. Remember, Mr. Speaker, unemployment in these days was a problem members of the government said they could meet. We tried to meet it by expanding the economy, by expanding exports and trade, but it did not come about. Now I find according to the Liberal press of the last few weeks, that the unemployment of today is something that is built into the economy as a result of changing economic and technological conditions. The alibis are already started, and in all parts of Canada

alibis are being advanced in the Liberal press saying that this is a new kind of unemployment. However it is no different in 1963 than it was in 1961 or 1962, but at that time members of the present government said they could meet the problem very quickly.
We tried to meet it through the winter works program which, as I have already said, is being diminished in importance by the fact that the period is being reduced. We also tried to meet it by the vocational training capital construction program, which will terminate in October. Over a two year period this program put into effect a total expenditure of around $500 million, of which 75 per cent was committed to capital construction. That plan provided an estimated minimum of 25,000 to 30,000 jobs in winter works, both on and off site, and in the provision of supplies, materials and auxiliary construction. What is to take its place?
The plans so far advanced by the government is merely for an extension or continuation of the programs which we provided, but since the building program under the vocational training scheme is to end this year, a full year will be required for the preparation of plans and programs for any new capital construction, which means a loss of tens of thousands of jobs. How will that loss of jobs be made up? Well, there is this plan, that had to be so altered that it bears little resemblance to the one that went into the grist mill of the dominion-provincial conference.
What are the plans of the government to meet unemployment? We have not heard them yet. There is the $500 bonus for the construction of houses during wintertime, but that incentive is almost completely obliterated by the combined effect of the imposition of the sales tax and winter building costs. Then there is the incentive to employ older workers. Well, we have heard very little about that plan. The plan for 45-year olds was supposed to be a tremendous thing. We have not heard very much about that, because they are beginning to realize there is nothing effective about it in any major sense.


Some hon. Members:: Oh, oh.


John George Diefenbaker: These are the people, though, who had the answers. They do not like to hear this. I do not blame them. They told us for four or five years, "Give us the tools and we will do the job". They got the tools, and they have produced little or nothing in the present session of parliament; there is nothing before parliament requiring attention.
Municipal Development and Loan Board
What is going to be the result of the 4 per cent tax, the revised version of the 11 per cent? Well, the estimate I have seen- and it is only an estimate; it is a "guesstimate" I suppose-is that this will result in a holdback on projects of as much as $50 million. That means a loss of jobs. Sir, with the 20 per cent cut-back in municipal winter works, with the cut-off of the vocational training capital construction program in October, with the effect on municipal borrowing of the measures announced in the United States by the President-which we were given to understand had been almost entirely removed as a result of a two-day visit to Washington-the situation regarding employment becomes a very serious one. We are thus faced with the prospect of new and onerous unemployment conditions which have been brought about in large measure, not by conditions over which we have had no control but by the very actions taken by this government which in a period of two and a half months has shown an ineptness that has no equal in Canadian history. We now have no program, no policy and no action to deal with unemployment for this coming winter.
Sir, this legislation-and I will deal with it at some length when we get into committee, as others probably will-is a plan that was altered almost in its entirety as a result of meeting with the provinces. It is one that contemplates the expenditure of $400 million over a period of three years. I am informed that it will mean at the most 12,000 jobs this coming winter. I hope it means many more. I am informed it will mean no more than 25,000 jobs in the two succeeding winters. What is going to be done on the part of the government to solve the unemployment which the Minister of Labour (Mr. MacEachen) himself admitted the other day, on the basis of the estimates that were before him, will be serious? Whatever estimates were given to him when he took office will have to be increased because of the actions taken by this government in its budget, which can only have the effect of making for fewer and fewer jobs in this country at a time when the government states its objective is to increase the number of jobs. The provinces have accepted this measure. They have been consulted, as we insisted they should be. I want to see this legislation passed. I want to see action taken as quickly as possible. At the same time, we are going to examine it carefully. If it had not been the opposition taken by this party when the resolution was introduced, this government would have gone ahead pell-mell without any consultation with the provinces.
2912	HOUSE OF
Municipal Development and Loan Board


Some hon. Members:: Hear, hear.


John George Diefenbaker: We insisted on it. They finally gave in when they received denunciations from the provinces, the most outspoken that have been made certainly within the last 25 years. Then they called the provinces together and said, "This is our plan, but what do you want? We want you to take this plan. Give us your ideas". The provinces did: the government of Canada said, "Me too".
(Translation):


Gilles Grégoire: Mr. Speaker, I listened with great attention to the remarks made by the Minister of Finance (Mr. Gordon) when he presented the amended version of the Municipal Development and Loan Act.
One thing seems to be the leitmotiv of his remarks. It is that this revised version, at least this amendment that the Minister of Finance wants to make, has the support of all the provinces, in short that it is with the approval and the unanimous consent of all the provinces that this revised version is submitted to us today.
Well, Mr. Speaker, I wish to say one thing. In the province of Quebec in particular there are circumstances when mistrust is deeper than in others. That is when there is a Liberal government in Ottawa and in Quebec. That is when we have to be wary. History has shown that it is precisely when there are Liberal governments in both Ottawa and Quebec that our province gets hoodwinked and is stripped of its rights.
That is more or less what happened during the last war when Ottawa asked Quebec to conclude a tax-sharing arrangement, to agree on the rental of its sources of income for the duration of the war only. We do not know what happened behind the scene, but we do know that Ottawa still has those sources of income.
Mr. Speaker, we are ready to examine the bill impartially but-


Mr. Maurice Sauve (lles-de-la-Madeleine):: Would the hon. member permit a question? He states that only the government of Quebec and the central government made certain agreements during the last war. Surely, he must remember the agreements signed by both governments which were in power in Quebec and in Alberta, a province which is so dear to him.


Gilles Grégoire: Mr. Speaker, I would like you to have the earphones of the hon. member for lles-de-la-Madeleine (Mr. Sauve) checked because I never said that only the province of Quebec had concluded agreements, but I did say that the Quebec and Ottawa governments did so. I never used the word only, because I am well aware that all provinces signed agreements, and it is still worse since the federal government has been not only depriving the province of Quebec of its sources of income but all ten provinces. Such was the opinion that one might have had of the federal government at that time.
Mr. Speaker, before being unexpectedly interrupted by the hon. member for lles-de-la-Madeleine, I was saying that we are ready to undertake an objective and constructive study of this bill. However, you will admit that this will not be easy, since we do not have in hand the amendments which the Minister of Finance wishes to introduce.
We only have the bill that was introduced on June 17, but much has happened since then. In order to provide Essistcince mi mi p-ipalities, the Minister of Finance told us himself that he would make some changes, but we do not know what they are.
At all events, we shall consider the measure and try to help the government, because we feel it is essential to assist municipalities in undertaking and completing works which are necessary today. In the times we live in, when tremendous and essential development is required, we must see to it that our municipalities can keep pace with progress and for that, they must undertake major works. But since they have no source of revenue, because other levels of government have them all, municipalities are unable to undertake alone the works essential in our times. That is why our municipalities need some assistance.
The initial bill seemed to indicate that the federal government was going to intrude in a field of exclusive provincial jurisdiction and provide direct assistance to municipalities under the form of loans. The government appears to have changed its mind since the loans will be made to the provinces which, in turn, will lend money to the municipalities. However, it is worth mentioning that when the central government lends money to the provinces on the conditions that the funds will be used for such

Municipal Development and Loan Board
and such a purpose, it cannot be said that the provinces are entirely free.
If the province of Quebec, or any other province, borrows at the pro rata of its population, any portion of the $400 million offered to the municipalities, it is not free to do whatever it wants with the money.
Thus, if a province feels that it has projects more important than some others to carry out, it is not free to choose. The province is always more or less subservient to the federal government, which dictates the way in which the money is to be spent.
Please note, Mr. Speaker, that if the provinces borrow that money they will have to pay it back and therefore the money is loaned to them actually on their credit. They use their credit to borrow, but they cannot do what they want with the money borrowed. They must fulfil some strict conditions, at least as I see it from the bill now before us. As a matter of fact, they must respect some particular provisions imposed upon them by the federal government. In my opinion, this constitutes interference by the central government. We all agree that we must assist municipalities, but not at the expense of the liberties the provinces fought for and at the expense of municipal freedom.
Mr. Speaker, for many years, indeed for many decades, Social Crediters have been advocating a system of interest free loans to municipalities. As a matter of fact, such a proposal has been part of our political platform for several years. But the bill now before us is different in that clause 14 provides that the money will come from advances out of the consolidated revenue fund.
Now, Mr. Speaker, I would ask the Minister of Finance to explain to us what is the consolidated revenue fund. That is not really a fund, because there is no money at all in it. It is a fund without funds. There is no money in it.
In fact, the Minister of Finance will have to borrow money to make a deposit in the said fund. Or still better, as just suggested to me by the member for Charlevoix (Mr. Belanger), the Minister of Finance will create a pot in order to lend to the provinces, which in turn will lend to municipalities. As a result, the money will be in circulation but will be used only by the last borrower.
The Minister of Finance will issue bonds to create that $400 million fund and then, he will deposit the money in the consolidated revenue fund of Canada. But why always borrow from the chartered banks and from private enterprise to develop the social capital in our country, our municipalities, our provinces?
Mr. Speaker, the Minister of Finance stated that he had several amendments to move. Well, we shall also have one to bring forward, in which we shall request that the money be not taken from the consolidated revenue fund which does not exist anyway.
In fact, I challenge the Minister of Finance and all the members of the cabinet together to indicate to me a single copper which exists at the present time in the consolidated revenue fund of Canada.
And after that we are told that the money required will be taken from advances out of the consolidated revenue fund, when there is not a single cent in it. In other words, money will be taken from where there is none at all. But of course we are still using the old orthodox economic system, as we know it today and which consists in borrowing, as it has always been done in the past, from the chartered banks, which create credit in order to lend money to the federal government.
Well, our amendment suggests that instead of obtaining that money from a fund without funds, we should take it from the Bank of Canada. There are funds there, Mr. Speaker. And there are credits there which belong to the Canadian people, to serve for the development of the country.
In the Bank of Canada, there are credit possibilities which belong to the Canadian people and which will allow them to develop the country without continuously getting into debt, through progress made in every field.
Mr. Speaker, I remember that last year- and it can be found in Hansard-the Liberals unanimously voted for the establishment of a debt free money system. Yes, those gentlemen all voted in favour of that debt free system. Were you in good faith at that time, or just dissembling?
If, when you were sitting on the opposition benches, you meant to prove to the people that you had some good ideas, you did so by voting for a system of debt free money. But, if on the other hand, you were not sincere and just pretending, you would not be over anxious today to put that system into practice. Any way, we shall give hon.
2914	HOUSE OF
Municipal Development and Loan Board members sitting on the government benches the opportunity to prove that they were sincere-


Mr. Deputy Speaker:: I am sorry to have to interrupt the hon. member, but I have to remind him that he should address the Chair, when making his speech.


Gilles Grégoire: Mr. Speaker, I think that hon. members who are now sitting on the government benches have today the opportunity to prove that they were sincere when
they voted in favour of a debt free money system.
Mr. Speaker, I am surprised to see the evolution happening on the government side. Sometimes, I get the impression that the ideas sown by others flow over their heads like water from a duck's back. But when discussing with them, one is often asked: Your system is quite sensible; I think that there is some good in it. Only, my wife has some victory bonds or savings. Does it mean that she will get no more interest?
Mr. Speaker, we note a certain interest for our system. People begin to notice that it is not as ridiculous as they thought. Well, I shall give them exactly the same answer that I gave on several occasions to those who asked that question. We are not advocating a system where the Bank of Canada would finance every development throughout the country. No. No, but we want the Bank of Canada to act as a medium that will create the credit required for the development of our country, which means that it is public works, and not industries and manufacturers, companies and business concerns, in brief it is not the private sector that accounts for the development of the economy of a country, but the public sector. Municipal works belong to that sector, since they are useful to the community, and also provincial and federal works, for the same reason.
Well, as I said, those works are useful to the community; they make a country richer and bring prosperity.
Why could we not use also a public agency to create the public capital that would be used to pay the cost of that progress which helps the community? By doing so, we would not be compelled, as we are today, to borrow and pay interest and to repay to private enterprise, money which we are using to develop public capital in this country and stimulate progress in the public sector.


Mr. Speaker, this is an important amendment and we are going to move it. Whenever we, of the Social Credit party, were speaking of municipal loans, we always added the words "through the Bank of Canada" and "at the expense of the administration". The Bank of Canada is an organization subject to government, to the crown, or rather to parliament. It is an organization that has been created by parliament, of which we are members.
The Bank of Canada exists today because members elected by the people in a democratic way stood up one day in this house and voted for the establishment of the organization which we call "The Bank of Canada".
The Bank of Canada comes under parliament since it was established by parliament. It belongs to the Canadian people and we are responsible for it because it was set up and it operates by virtue of a federal statute.
Therefore, if we carry the responsibility for the bank, let us make sure that it fulfils the purpose for which it was established, that is to help in the development and progress of our country in the field of public facilities.
Mr. Speaker. I submit that if we were to take the money from the Bank of Canada instead of borrowing it from private enterprise and chartered banks and put it in the consolidated revenue fund, there would not be one penny more in circulation in Canada and there would be no danger of inflation.
That would not cause inflation. The Minister of Finance knows full well what inflation is, since he gave us a sample when he established the tax on building materials which has caused the price of buildings to go up and depreciated our dollar. That is inflation!
The Minister of Finance knows what inflation is, Mr. Speaker, because he takes steps which will cause inflation.
I would not look kindly upon any member opposite who would claim that inflation is caused by Social Crediters because they themselves are the ones responsible for it.
Inflation is something which is blown up. It is inflated money, like a blown-up balloon. The government's 11 per cent tax is such a balloon. In other words, before long our dollar will be worth nothing.
That is why we call on the government to secure its money from the very source of money, the Bank of Canada. That will not create inflation because there is inflation only

Municipal Development and Loan Board
when there is too much money in circulation for the quantity of products available.
Now, the Bank of Canada would issue $400 million of credit, but only at the same rate as municipal development.
The Minister of Finance is an accountant, Mr. Speaker, and when he first came to the house, he was known to be the best accountant in Canada. He must know then that in accounting there is a column for assets and another one for liabilities. The entries in those two columns must balance, and then everything is fine.
I am not quite as good an accountant as the Minister of Finance, but I was able to learn that much in the few classes in accounting that I attended. If the Bank of Canada were asked to put credit in circulation at the same rate, not more rapidly or more slowly, but at exactly the same rate as the development of our municipalities, results would be much more satisfactory. For example, when a muncipality builds a $5 million sewer, $5 million are added to Canada's assets. Then, unavoidably the Minister of Finance will add $5 million in the other column. This means that if the Bank of Canada does such a thing, there is no inflation, since the credit is proportional to the product.
If on the other hand, $7 or $8 million were put in circulation, while development projects in our country would only amount to $5 million, we would unavoidably put too much money in circulation and thus create inflation. Then would appear a few individuals to do as the public relations officers of the Liberal party did at the last election and say that money would become valueless.
Well no, that is not true if, as we increase the wealth of this country by building roads, hospitals, bridges, sewers, water systems, we create the required credit at the same rate, neither more nor less, but only what is needed to pay for the country's development. Then, you do not create inflation.
Mr. Speaker, the money used to pay for all that is but a sign which represents all those developments, which are the things signified.
Money is a sign, an index like the quicksilver found in a thermometer. The mercury rises or falls as the temperature goes up or down. A week ago, in Ottawa, it was very hot; so, up went the mercury. Now that it is not quite so hot, the mercury is going down. As the temperature goes, so goes the mercury.
28902-5-185
Money should act the same way in relation to production. The Bank of Canada should see to it that the amount of money in circulation is constantly kept in balance with production and the development of our municipalities, thus keeping pace with the progress we want for our country. Money must follow the progress of the country and the accrual of the wealth in the country, neither more nor less, but at the same level.
Money must play its role, that is the role of a symbol, and represent adequately the thing signified, the products to be called sewers, waterworks, or anything of the kind.
Mr. Speaker, if we were acting that way and accepting, one of these days, to see that money follows production instead of trying, like we do today, to make production follow money-which is illogical, I may tell you, at this time, Mr. Speaker, that with the will, courage, determination, capacity and ability of our workers, of our builders, of our contractors, with all the goodwill of our aider-men and school boards, we could develop this country and see to its progress. Money always being there to follow, it would be neither an obstacle nor an impediment to this country's development. It would be a help.
But we always hit an obstacle, a real one. There is no money and no credit, whereas we would be able to develop the country.
The best example of such an attitude, Mr. Speaker, was when the Minister of Finance, in concluding his speech, spoke of a maximum number of jobs at an early date.
Four hundred million dollars for three years. If the province of Quebec takes its share, it would be about $120 million for three years, or $40 million in one year. How can the Minister of Finance expect to reach maximum employment with $120 million for three years, or $40 million for one year in the province of Quebec, at a time when we had only a few unemployed and practically full employment at 100 per cent, more than $22 billion were spent in five years- i.e. $4,500 million, and not $400 million, in three years. Full employment was successfully reached by spending a hundred times that much during the war, and today we hope to create maximum employment at an early date by spending only one thirtieth part of the amount made available to the municipalities.
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Municipal Development and Loan Board
Well, Mr. Speaker, let me repeat, for the benefit of the Minister of Finance, what I said yesterday to the President of the Privy Council (Mr. Lamontagne): they come to us with all sorts of legislation which they have worked out in their heads in their committee sittings, but let them go ahead for two years with all their economic or orthodox theories, and in two or three years from now they will be very much surprised, throw up their arms and say: "It did not work, we studied it for a long time, but it did not work."
This is likely to happen, Mr. Speaker, if we do not accept to change the system and to pass legislation beneficial to municipalities. We should spend not only $400 million in three years, but a good deal more in order to give work to more than a few hundred people.
Four hundred million dollars for three years, that means, on a pro rata basis, $40 million a year for the province of Quebec. If one considers that, in a public undertaking, hardly 20 per cent of the money goes for wages, that represents only $8 million.
Mr. Speaker, this is not much. How many jobs will be created? If it is estimated that employees earn $4,000 or $5,000 a year, this is scarcely good for 1,800 employees or 1,800 fewer unemployed. Now,- there are far more than that in my constituency of Lapointe. That means that 70 other ridings will be left with the same problems they have now.


An hon. Member:: I want some too.
Another hon. Member: Me too.


Gilles Grégoire: I hear some members say that they want some for their ridings too. There is barely enough for mine, Mr. Speaker.
If the Minister of Finance intends to get his credits from the Bank of Canada, he can ask the house to vote the amount he needs and we will do it, because then the money will be coming from the Bank of Canada, which is a government institution. Let us not pile debts on the future generations and put on their shoulders a burden similar to that under which we stagger today when we must pay $910 million a year in interest on the public debt. Why? Because we have always taken our money in a fund without funds, that is the country's consolidated revenue fund. There was no money there. Ex-


penditures have always been charged to the consolidated revenue fund in Canada and, this year, the interest on the public debt totalled $910 million.
We will study the legislation objectively. We have an amendment ready but, before presenting it, we hope that the Minister of Finance will agree to do so himself. I seem to understand that it would be logical, even more so because I was proud of him last year when he rose to vote for that motion about debt free money.
Mr. Speaker, the present Prime Minister (Mr. Pearson) also rose to support that motion and, at that time, all the other Liberal members cheered; they cheered and so did we. But I have faith in their sincerity, in their political and intellectual honesty. In any case, that will give us an opportunity to judge them. We are suggesting to them to set up, at least in a limited way, a system of debt free money under that new legislation.
Mr. Speaker, I have other arguments that might encourage the present cabinet to do that.
I am not too sure whether there is in this government members of the 1940 cabinet, or if there are still members who were here in 1940. Those may remember that the government of that time did exactly what I am suggesting tonight when it requested the Bank of Canada to create the first $200 million to finance the beginning of the 1939 war.
Gentlemen of the Liberal party, if there are among you any members of parliament who were in the house in September or October 1939, they remember well that they voted for exactly what we are suggesting tonight. But at that time the amount was $200 million. As times have changed and money has lost some of its value, it would be normal that we vote $400 million today.
Furthermore, if we have been able to do that for the war, why should we not be able to do it to help solve the problems of our country. The Minister of Finance could then say he is really financing and that he actually is assisting municipalities without having to think all the time that he will have to come before us again next year thinking: We will have more interest to pay this year because we had to put money in a depleted fund.
Mr. Speaker, this is my conclusion and I submit to the goverment that even if they must spend night after night to consider this amendment,-because it is their respon-

sibility to find new ways of financing public works-I feel that the suggestion we are making tonight will be advantageous to them.


Mr. R. W. Priliie (Burnaby-Richmond):: Mr. Speaker, it is always difficult to speak after the great orator from Lapointe (Mr. Gregoire).
(Text):
I shall not deliver a lecture in economics, Mr. Speaker, but will try to keep to the bill under discussion. We have our ideas about banking and finance too, but in the interests of getting the legislation through I think we should confine ourselves to what is contained in the present municipal aid bill. When we in the New Democratic party spoke on this legislation at the resolution stage we thought generally that there were sufficient safeguards for the provinces. Every proposed loan had to be approved by the department of municipal affairs in each province. We felt this was sufficient. However, there were complaints from the provinces and when the government was faced with a unanimous vote of the legislature of the province of Quebec they had to take some note of this fact. We were pleased to see that the conference was a success. I do not find very much in the Toronto Telegram which to my mind is worth quoting but I think an editorial in the issue of July 30 has some merit. It reads in part as follows:
Possibly most important of all, the compromise on the municipal fund created a new and healthy atmosphere for federal-provincial co-operation, which may be next felt in discussions on the proposed federal portable pension plan later this year. The 11 governments have got over one hurdle; why not another?
We are very pleased to see that the government has broadened the scope of the bill and that hospital and school construction may now be included under the loan provisions of the legislation. We and other opposition members said during the debate on the resolution that this should be so. If the government would listen to the opposition more frequently they would get some good ideas, but they have been persuaded by the provincial premiers on this point. However, broadening the scope but without increasing the amount of money will mean simply this, that the available money under the bill will be used up a great deal more quickly than it would otherwise be. The provision in the bill is to the effect that the amount is to last until March 31, 1966. I suggest this fund will be used up, particularly since the scope has now been broadened, much before that time.
One of the important things is that the minister has said funds would be allocated to the provinces on a per capita basis. I know that some particular method has to be worked out, but I am not entirely sure that this is 28902-5-185*
Municipal Development and Loan Board the best method. The three provinces which have the greatest population, I think, are three of the richest provinces in the country and the ones which can best afford to help their municipalities. The Toronto Globe and Mail of July 29 pointed this out. I should like to quote in part from the editorial on this subject.
One alteration in the legislation must be greeted with reservations, that which will allocate funds to the provinces in proportion to provincial population. The purpose of the bill is to provide jobs for the unemployed, and the distribution of funds should surely, therefore, be related to the incidence of unemployment within a province. The money was raised in the provinces. If it is now to be turned back to them on a basis of population, there will be little recognition of the differing employment needs of different parts of the national community. It will be merely another handout.
I had rather hoped, Mr. Speaker, that the minister would have announced some changes in clause 7 of the bill because, as I see it at the moment, it is quite unworkable. I do not know who drafted it but there have been a great many complaints about it. They are trying to establish the fact that a municipality can only borrow money for works which would not have otherwise been undertaken. Now, many municipalities, particularly the larger ones, plan well in advance. They lay out capital works programs. They know what they want to do and they cannot include very much else. The council of the city of Vancouver has complained about this. They have said it may encourage deception. I feel this clause should be looked at very carefully because it is unworkable.
Now, Mr. Speaker, there is another aspect of this matter to which I should like to refer. So far in the discussion about municipal aid, the federal government has been considered as the villain of the peace. I think the provinces bear some responsibility. Many of the provincial governments have not been notably generous in providing aid to their own municipalities. This is particularly true in relation to the larger urban centres in which many of the people of Canada live. They are very quick to criticize the federal government, but they are not so quick to aid the municipalities which need it most, the municipalities in which we find this tremendous concentration of people. These are the ones that have large costs which go with a rapidly expanding population.
The Ottawa Citizen of July 30 pointed this out, particularly with reference to the province of Ontario. I would say that it certainly applies in my own province, too, because the government of British Columbia is not too generous to the municipalities, particularly the larger ones. The Citizen had this to say:
Alternatively, the Ontario government could relieve the municipalities of obligations such as
2918	HOUSE OF
Municipal Development and Loan Board social welfare expenses and part of their education commitments, leaving real property to pay for the installations that benefit property, such as roads, sewers, and police and fire protection.
Understandably, Mr. Robarts did not state this alternative, which would require a new financial relationship between the provinces and the municipalities. But the welfare and education obligations assumed by the municipalities are imposed by provincial law. The province on the one hand gives the municipalities no choice except to assume these duties, and on the other hand does not allow the municipalities sufficient revenue sources to discharge their obligations, without placing an extremely heavy burden on real estate and discouraging home ownership.
A new provincial-municipal relationship is long overdue. In its essentials, the current set-up was founded many decades ago, when urban centres were relatively small, and when social welfare and education costs did not consume much of the average municipality's budget. Today, they account for more than 50 per cent of the operating costs of the larger cities, including Ottawa. Mr. Robarts could contribute much to Ontario's welfare by removing this distortion.
I merely mention this because we hear much about a new federal-provincial relationship in connection with financing. I think the provinces could look within their own boundaries and look for a new relationship with the municipalities generally.
The Minister ui Finance (Mr. Gordon) hoc again emphasized the purpose of the legislation, that is to provide the maximum number of jobs and at an early date. I shall just take a moment to repeat a criticism which we made at the resolution stage. There is $400 million to be spread over three years, or $133 million a year for all the municipalities in Canada. This is not a large amount. It will help, but it will not make a strong impact on the employment situation. I feel the government will find that it will provide a limited number of jobs and they will have to take another look at this next year.
Now, in order to assist the quick passage of this bill, because the municipalities are anxious to make plans for the coming winter and because the administrative machinery must be set up within the provinces to handle this, I can assure you that the members of the New Democratic party will not speak too frequently nor too long on this measure. We have made our views on it known. We are anxious to see this measure in operation as quickly as possible. I am glad that the principle of providing aid to the municipalities, to the provinces, has been established. We hope that in the years to come this will grow to a much greater extent than it is now. (Translation):


Mr. Herman Laverdiere (Bellechasse):: Mr. Speaker, I take it as my duty to rise in this house to support the bill that is now before us.


This measure, more than the others that have been previously discussed, concerns directly my constituency.
Mr. Speaker, the county of Bellechasse is mostly rural and the dairy industry is the main means of livelihood there. For the last few years particularly, the farmer's income, especially in the district I am more familiar with, namely the one that lies on the south shore of the St. Lawrence, from Lotbiniere to the Gaspe peninsula, has been very low. Especially in these last few years, some farmers must really have had great courage to stay on their farms.
Municipal and school taxes have become too heavy a burden in most municipalities; so, certain improvements and works which are needed, and even urgently needed in several parishes, must be delayed in order not to raise municipal taxes which are already too high.
Our municipalities will welcome this legislation which will enable them to undertake improvement of their waterworks, a problem in several places, repair or construction of sidewalks, development of adequate parking lots for public places, improvement of sewer systems and other public utility projects. I hope that the province of Quebec will also apply this plan to the building of civic centres where young people especially will be able to receive a good training while spending their leisure time in sound recreational activities.
I insist specially on that last point, because rural municipalities cannot, by themselves, support the cost of such buildings; on the other hand, it has become a necessity to enable every parish to organize recreational activities so that our splendid rural youth, which are very talented, do not wallow in amusements more or less perniciously organized by profiteers. The whole rural population wants well organized civic centres and rural municipalities do not have now the financial means to develop them.
The towns concerned will take advantage of this legislation, but Mr. Speaker, we must first of all think about our small rural property owners, especially in the area I just mentioned, who deserve a certain comfort without having to bleed themselves white in order to improve public services. The rural people's request should have priority, because of their present financial situation which is quite unsatisfactory as compared with that of large centres.

Municipal Development and Loan Board
As far as these loans are concerned, let us think less about the municipalities which have a substantial budget, and more about those which are heavily involved in debt and where the public services are a sorry sight, particularly when compared to those of large centres. The rural population also deserves our full attention, and I strongly suggest that loangranting authorities give it top priority.
A comparative study of public services in towns and villages, in relation to municipal taxation, would soon show that the small rural property owners must be helped first.
The benefits to be derived from this legislation will be twofold, as many unemployed people will find jobs thanks to the municipal work programs. Rural unemployment is more prevalent than one would think, for many jobless people are not listed with the unemployment insurance commission, or with the various federal or provincial employment offices.
That is why I am very happy about the agreement arrived at between the federal government and the provincial governments, and more particularly Mr. Lesage's delegation, because the province of Quebec will be entitled to a full share of this remarkable assistance program, which was long overdue. We must help our rural communities for they deserve it as much as our cities. They are showing signs of impatience, and I can not say I blame them for it.
(Text):


Mr. G. L. Chaiferlon (Esquimalt-Saanich):: Mr. Speaker, my remarks will be brief. There are three points I would like to make on this proposed legislation. The first concerns the approach of the government to the whole problem of federal municipal assistance, the second deals with the philosophy of federal assistance to municipalities, and the third is with regard to the scope of the proposed measure.
In dealing with the first, the question of the government's approach, as soon as I received a copy of Bill C-76 I immediately sent copies to all the municipalities in my constituency and to certain key officials in the department of municipal affairs of British Columbia. Then I paid a visit to my area early in July and contacted these same people. I was amazed to find that not only were the senior officials of the department not consulted but by that time, which was about July 5, they had not received copies of the bill, and I found, certainly with regard to preparation of the bill, that these people had not been consulted.
I am sure if they had been consulted-and this would apply to every province of Canada -what would have come out of the mill would have been completely different from this bill I have in my hand and, as I surmise the new bill will be, when it is amended in committee. For example, I understand from the general comments made by the minister that the provinces will be given an almost completely free hand in how the money is to be used. However, does the minister realize that if it is permitted for municipalities to use it for school construction, this would not apply in British Columbia because in that province municipalities do not spend money on the provision of schools? In some provinces municipalities are able to borrow money from the federal government to finance school construction, whereas in British Columbia they would not be able to do this.
I would submit that even with the forced, rushed conference they had last Friday and Saturday, the results that came out of that did not represent what might have been achieved if there had been formal consultation with the provinces, and through the provinces with the municipalities. If that had taken place the program would have been completely different.
My second point concerns the philosophy of federal assistance to municipalities. When he introduced the resolution, and subsequently, the minister said that the prime and only purpose of this legislation is to promote employment. That is a commendable objective but it does not go far enough. I think we all realize our municipalities need help, and it is true they are the creatures, the offspring, and the responsibility of the provinces, but yet there are certain phases of municipal problems that become national problems.
When this party formed the government our approach was in certain selective fields of municipal problems which became national problems, and for which the federal government gave assistance. I have in mind our assistance to municipalities for the control of water, and sewerage pollution. It was strictly a municipal problem in most cases, but it was a problem that had national implications. Therefore the former government said, "We will assist municipalities in this special respect so as to solve the problem, which is one of a national nature."
There is no such approach in this legislation. It is supposed to be strictly for the purpose of creating employment. This is regrettable, and if there had been advance consultation with the provinces perhaps what would have resulted would have been legislation not only to assist employment but also to assist municipalities in those problems which have become of national significance.
2920	HOUSE OF COMMONS
Municipal Development and Loan Board
My third point deals with the scope of the proposed measure. I remember so well that, during the election, one of the government's main planks was vast assistance to municipalities. At that time it was not supposed to be merely for the purpose of creating employment. It was to assist municipalities. I know that in my own area the municipalities thought this was going to be a tremendous source of revenue to them, with loans at low interest for almost any project they wanted to undertake.
Let us compare this proposal with some of the measures which the previous government took, in order to get an idea of the scope of the proposal in relation to the whole question of municipal problems. The maximum amount proposed by this legislation is $400 million to be spent over three years. Some time has elapsed since the resolution was introduced, so really only 30 months remain. So at that rate $400 million over 30 months would allow for loans to municipalities of about $160 million a year. Since the loans are to be only two thirds of the cost of the projects, the total value of the projects financed by this measure would be $240 million por annum. Th?t is t-n say. $240 million per annum would be the total cost of the projects covered by this proposal.
The winter works incentive program of last year covered work of a total value of-


Walter Lockhart Gordon: Mr. Speaker, I wonder whether the hon. gentleman would allow me to ask him a question. It seemed to me that his arithmetic was somewhat in reverse. The $400 million represents two thirds of the projects, so that the total volume of the projects is $600 million, and not less than $400 million.


George Louis Chatterton: Mr. Speaker, either the Minister of Finance does not know his arithmetic or he was not listening to me. I will repeat what I said. I said the total amount was $400 million. I gave the government the benefit of the doubt by leaving only 30 months rather than the three years envisaged when they introduced the resolution. That is $160 million a year in loans. Since the loans are two thirds of the cost of the projects, the cost of the projects is $240 million per annum. That is exactly what I said the first time.
I make my point, Mr. Speaker, comparing this proposal with just the winter works incentive program of the previous government. Under this proposal the average cost of the work per annum would be $240 million. The cost of the work under the winter works incentive program last year was $246 million; in other words, the value of the work covered by the winter works incentive program was more than this whole, vast assistance program to municipalities. Furthermore, the winter

works incentive program generally by its provisions covered work which was of a high labour content. According to the last annual report of the Department of Labour, the average labour content of the work covered by the winter works incentive program was 31 per cent. I would say the average labour content of the work to be undertaken under this proposal would be in the order of 20 per cent. In other words, the total effect of this program on the question of employment, apart from anything else, would be much less than that actually proven by the winter works municipal program.
Then, of course, municipalities are interested in the forgiveness of the loan. Just compare this proposal with the forgiveness under the winter works incentive program. The forgiveness under this program would be in the order of $40 million a year, which is 25 per cent of $160 million; whereas the direct federal contribution last year under the winter works incentive program was $40,822 million. Therefore for that reason also the winter works incentive program alone had a larger beneficial effect than this vast proposal to assist municipalities.
Gvci and above the assistance we gave +n municipalities by way of winter works incentive that I have mentioned were the loans for municipal sewage under section 36 of the National Housing Act. Under that provision last year the federal government made loans to municipalities of $45 million and the value of the projects covered by those loans was $67 million. Keep in mind that under the measure of the previous government we did not assist the whole sewerage program of the municipalities; it was only related to the treatment plant and certain trunks, so that the additional work which the municipalities provided over and above what we gave was considerably in excess of that figure.
Again, Mr. Speaker, looking at the question of the scope of this program and coming back to my first point, that the municipalities are the responsibility of the provincial governments, we must never forget that during the term of office of the previous government payments to the provinces vastly increased, from something of the order of $700 million in 1957 to almost $1.5 billion in 1962. That means a payment to the provinces of some $800 million more in one year, 1962, than they got in 1957. It is true that there was no compulsion on the provinces to assist the municipalities; but surely this additional payment to them by the federal government should have placed the provinces in the position of assisting the municipalities. I am sure no one here will deny that the municipalities do need assistance. They are the creatures and

responsibilities of our three levels of government. They have limited resources. Their major resource is the property tax, which most people are finding too burdensome. They do need assistance, but let not this government or anybody else think this proposal is going to be an answer to the problems of the municipalities.


Mr. J. J. Greene (Renfrew South):: 
Rémi Paul: Mr. Speaker, under no circumstances would I have missed the speech made tonight by the Minister of Finance (Mr. Gordon). As for me, I was greatly impressed. As a matter of fact, I find him very likeable because he shows a great deal of courage in his retreats, and I feel that the statement he made tonight is another retreat. We shall see in what respect in a few minutes.
Moreover, I sympathize with him because I fear that before long he will be retired as Minister of Finance.
When we examined the speech from the throne, we were concerned from the very beginning about the threat that might contain the legislation the government intended to introduce in the house, because we thought that provincial jurisdiction could be involved. That is why, at the beginning of the session, the hon. member for Brome-Missisquoi (Mr. 28902-5-186
Municipal Development and Loan Board Grafftey) asked the Minister of Justice (Mr. Chevrier) whether he or the government had had any consultation with the provinces about the proposed municipal aid program. At that time, the Minister of Justice answered:
Mr. Speaker, I am not aware of any communication of the kind mentioned by the hon. member.
On June 13, when this measure was brought before the house, the Leader of the Opposition (Mr. Diefenbaker) warned the government about the danger involved in that resolution if it were not first submitted to the approval of the provinces.
We put questions to the Minister of Finance. We tried to learn whether the provinces had been consulted in that respect. We did not get any answer and I said:
There must be no infringement or control over municipal autonomy. We must rather find a way to help the municipalities in the greatest respect of the constitution in order to improve economic prosperity and finally find a solution to the unemployment problem. But the most important point, Mr. Chairman, is to respect the Canadian constitution.
I submit that we should, before the final approval of the proposed legislation, obtain from the minister all the information required. We should like to know whether the provinces have been consulted. This is the cornerstone on which this measure should be built; otherwise, we would not have the right to carry on further consideration of this proposed resolution, as it would infringe upon provincial autonomy.
When the provincial premiers were informed of that resolution, official protests were raised. And at this stage, let me recall the forcible protests made by the premier of the province of Quebec, Hon. Jean Lesage, and by the minister of municipal affairs, Mr. Pierre Laporte.
And the position became so untenable that the right hon. Prime Minister (Mr. Pearson) saw fit to convene a federal-provincial conference which was held during the last week end. But the situation was so complex that the Minister of Justice went down to Quebec at the expense of the public treasury to have a discussion with Premier Lesage. The discussion was of a private character. What subjects were discussed? We do not know.
And when Mr. Lesage had condemned this resolution put forward by the federal government, the Canadian people wondered whether the Quebec provincial authorities were sincere in pointing out to the federal government the dangers of this legislation which constituted an encroachment on a provincial jurisdiction.
2924	HOUSE OF
Municipal Development and Loan Board
And when the provincial premiers met, we know that the problem was not settled the very first day of the conference.
Two main questions were supposed to be on the agenda, namely the establishment of a contributory pension plan and the bill to give financial assistance to municipalities.
Well, the discussion on the first subject had to be postponed and then we had a press release in which the Minister of Finance stated: "There has been perfect agreement on the proposal of the federal government."
But why bring such changes forward tonight-amendments we know nothing about? We do not know what will be the amendments which the Minister of Finance will submit. And yet, everything was supposed to be complete and perfect. Everything had been foreseen. The federal jurisdiction had been considered since the Minister of Finance told us on June 17 last:
As I have already pointed out, we have worked out the contemplated programs taking Into full account the constitutional rights of the provinces.
Then, who was wrong: the Minister of Finance or the provinces? If the provinces were not right, why then that federal-provincial meeting? So the provinces were right, since the government is now retreating. To what extent-we have yet to find out.
At this stage, Mr. Speaker, may I draw your attention to the legal validity of such amendments as will be submitted tonight, for we do not know yet whether we shall adopt that provision of the resolution which provides for the creation of the municipal development and loan board. What would be its use, Mr. Speaker? One wonders. On the other hand, if the board were abolished, the whole spirit of the resolution discussed in the house on June 11 would be changed. What right have we to give a bill second reading, if we modify the very essence of the resolution which has been studied previously? That is an interesting point, Mr. Speaker.
There is another question we might well ask ourselves. Would the granting of the concessions mentioned by the Minister of Finance not enable the federal government to encroach upon provincial jurisdiction, as this is yet another joint program?
The faulty part of this measure which we may have a chance to have a look at before the evening is over, is that we still want to


bind the provinces, namely to subject them to conditions that would be required by the federal government. Then, the provinces will not be able to act freely nor to carry out freely projects of such a nature that they would meet the serious unemployment problem.
I was listening a while ago to the hon. member for Renfrew South (Mr. Greene), who was suggesting alternative assistance to municipalities that could not take advantage of this bill. I wonder if the best alternative would not be to change the government?
When we were in power and unemployment reached an acute state, we took measures that have been effective and were partly successful in solving that serious problem.
Those hon. members opposite, who were supposed to offer a cure-all measure to settle the unemployment situation, where are they today, Mr. Speaker?
The Minister of Finance is enthusiastic and confident about his project. According to him, ii will jjruviue wuik for many unemployed and it will reduce unemployment substantially. However, his colleague, the Minister of Labour (Mr. MacEachen) fears that unemployment will be worse next winter.
Mr. Speaker, I respectfully submit that those $400 millions will not be sufficient to say nothing of the fact that this money will be spent in such a way that the federal government will be encroaching upon provincial jurisdiction.
Eminent members of the government are perhaps not at liberty to express their opinion on that point, except in caucus. However, if they are honest with themselves, they will get up-because some of them are brilliant jurists from the province of Quebec- they will take a minute to tell us how the government's attitude fits in with the statement made by the Quebec premier when he presented his budget on April 5, 1963. At that time, he said that the provinces should not participate in joint programs because, each time, they have to abandon part of their autonomy to the federal government.
When he came to Ottawa, did Mr. Lesage surrender to the central government which refused full liberty of action to the provinces? There are, no doubt, conditions that we know nothing about. Under the circumstances, I

Municipal Development and Loan Board
wonder if the best way to help the provinces, without violating the constitution, would not be, as I said earlier, to give them an additional 1, 2 or 3 per cent of direct taxes. Then, they would have the control of their sources of income.
Then, it is to relieve their conscience that the federal government considered that they must retreat and give back what they take away unjustly. Are we to conclude that this is absolute respect of the Canadian constitution?
I must point out that when we were in power, we took great strides forward in that direction. First of all, the previous government raised from 10 to 13 per cent the direct taxes returned to the provinces; afterwards, it went up to 14, 15 and 16 per cent, to reach finally 20 per cent.
But the present government will bring forward legislation and amendments which I think are not constitutional and which will prevent us from voting for this legislation, although it is, in itself, an excellent measure, because it will make, no matter how small, a contribution to the solution of the unemployment problem in the province of Quebec and in the rest of the country. But if the solution offered is not of a nature to respect the Canadian constitution, I shall vote against the legislation if there is a vote on it. However, I think, Mr. Speaker, that the government will bring forward really effective amendments to stimulate the Canadian economy, which has become nervous and unsteady. More and more, our industrialists and businessmen are frightened, because they never know which new retreat they can expect from the Minister of Finance or one of the members of the present cabinet.
We are not at present in a position to pass judgment on the constitutionality of the amendments, but we must hope that those amendments will be constitutional and, above all, that once and for all, the government will bring forward its cure-all measures, its great remedies, its great solutions to the unemployment problem.
I wonder whether the legislation passed to shorten the period of winter works will contribute to reduce unemployment. We have an unpractical government which, within 60 days, tried to make the people believe that it is a government of action. However, we realize more and more that we are dealing with a blundering government, because every week we have witnessed retreats and changes of opinions.
Various legislative measures and resolutions are being introduced. During the recess, the 28902-5-1864
cabinet will have more time and will be in a better position, after due consideration, to forget about the 60 days of promises Then, in the fall, the government will introduce measures likely to promote the Canadian economy and to provide answers to the impending serious unemployment situation.
We are most anxious to hear the Minister of Finance tonight set forth his amendments which will no doubt be consistent with the Canadian constitution and promote our economy.
(Text):


Horace Andrew (Bud) Olson: Mr. Speaker, I think that the main burden of our deliberations at this stage should be to deal with the proposed amendments that are to be introduced later and which result particularly from the consultations with the provinces a few days ago. We in this party have stated on a number of occasions that the provisions of this bill are at least a step forward in providing funds to expand the social services in Canada that are expected from the municipal governments. We think this is an excellent idea. We wish the government well and in particular the Minister of Finance as he pursues this end.
We also have some reservations in that the amount of $400 million for all ten provinces spread over a period of three years is not a great deal, but we recognize and appreciate that this is a step in the right direction. With regard to the point raised by a number of hon. members, that the government surrendered to the provinces, we agree that the federal government made some concessions to the provinces at the last conference. But after all, Mr. Speaker, what is the purpose of a conference if it is not to have consultations and to take cognizance of what the other parties to the conference have said to you? We in this party do not subscribe to the idea that change is bad. We believe that if there were weaknesses in the original resolution that was brought before this house, and the representatives of the provinces pointed them out, the government is to be commended for changing the resolution to meet those objections.
Our main concern, Mr. Speaker, is that there is one amendment that ought to be included in the bill that was not included in it. I refer to the fact that the hon. member for Lapointe (Mr. Gregoire) pointed out that funds for this municipal development fund should be obtained from the Bank of Canada. The leader of the official opposition (Mr. Diefenbaker) and other members have criticized the government because there were some changes introduced as a result of the conference with the provinces. One member even
2926	HOUSE OF
Municipal Development and Loan Board suggested that if this is the way they intend to handle the affairs of the country, perhaps the best solution would be to change the government. I ask you, Mr. Speaker, change to what? Certainly, I do not believe the people of Canada or the officials of the provinces would want to change back to what they had from 1957 to 1963.
I recall very clearly that there was a federal-provincial conference called in the autumn of 1957 with regard to the tax rental agreements. The premiers and their representatives met here on parliament hill. When they went home they expected to be called back. There were certain discussions in which viewpoints were put forward by both sides. A few days after the premiers and representatives of the provincial governments got home they received a telegram informing them that this was it: take it or leave it. Now, Mr. Speaker, that is not a conference; that is not consultation. I recall that when the vocational training scheme was set up, the provinces were notified what the federal government was prepared to do. There was an open-end agreement and the federal government would pay 75 per cent. There was no conference and no consultation to work
Out txic Octaila Ox liOw tins liiectsuit: was gulng
to be applied. I recall very clearly when the Agriculture Rehabilitation and Development Act went through this house there was no prior consultation with the provinces, yet the provinces were expected to administer the act.
Now, Mr. Speaker, this is not consultation in our view of what consultation ought to be. Certainly, therefore, there can be very little basis for criticism on the part of the members of the previous government when it comes to consulting the provinces. In an earlier stage of the discussion of this measure we in this party pointed out that if there were too many regulations set up by the federal government and too much direct administration of this act, there would certainly be resentment and resistance from the provinces. I think I pointed out on that occasion that the province of Alberta had set up what they called a municipal finance corporation. This has been set up for a number of years and its purpose is to supply all the capital needs of the municipalities in the province of Alberta. I suggested then that if the federal government were prepared to use this municipal development and loan fund to supply funds to this municipal finance corporation, it would be doing the service that it was intended to do and at the same time would not infringe on provincial rights in so far as the province's relationships with the municipalities were concerned. I hope that


this is now the intention of the federal government and the measure will be administered in that way.
We were told earlier that there would be an official, perhaps from Central Mortgage and Housing Corporation, who would be dealing directly with the municipalities. I am sure that most of the provinces would have objection to that. We are happy to see that there is now going to be a greater share of the responsibility for the administration of this act on the shoulders of the provincial governments.
In closing, Mr. Speaker, I want to say that I think this measure, particularly if the minister would accept the amendment we propose, would be the kind of bold, imaginative action that would assure him of a place in the history of Canada. If he would take this action tonight or before the bill passes, he could take his place alongside the late Mr. C. D. Howe who, I think, is acclaimed in Canada for mobilizing Canada's war effort. I believe the present Minister of Finance would be acclaimed in the years to come as the man who mobilized Canada for peace and for social advancement. He and the government have in their hands tonight an instrument which, if it is properly written and properly applied, could reverse this trend towards mounting debt and interest charges that is becoming alarming to all the people of Canada. He should let the Bank of Canada provide the funds that are necessary for the social services expansion of the muncipali-ties. I hope he will accept our suggestion. I am sure that 15 years from now when he looks back, he and the government of the day will be glad that they took our advice at this time.


Gordon Minto Churchill: I wonder if the hon. member would permit a question?


Horace Andrew (Bud) Olson: Yes.


Gordon Minto Churchill: Supposing the Minister of Finance does not accept your amendment or your advice, will your fulsome praise for him tonight be changed to condemnation?


Horace Andrew (Bud) Olson: Mr. Speaker, we would have to cross that bridge when we came to it.


Herbert Wilfred Herridge: rise to make a few brief observations which are more appropriate at this stage of the bill than later on. I know that the house is anxious to get on with this legislation, particularly as we are living in the shade of an early recess. I must say that I listened with a great deal of interest to the remarks made by the hon. member for Esquimalt-Saanich (Mr. Chatterton). I thought he made a very good analysis of the application of this bill

to the situation that exists in British Columbia. I presume he speaks with considerable experience, having been the reeve of a municipality there. I trust that the government listened to some of the suggestions he made and to some of his criticism.
I listened also with interest to the remarks of the hon. member for Renfrew South (Mr. Greene). In fact, at one stage of his speech I thought he would be making application to become a member of this party. He did make, I thought, some very sound observations with regard to this measure and to its limitations. He made some very sound suggestions, and I trust the Minister of Finance (Mr. Gordon) was listening to the remarks of the hon. member.
Members of this group have urged the necessity for a department of dominion-provincial relations so that there can be frequent consultation between the federal and provincial governments on matters that are of joint concern. As the result of the experience which the government has had with this bill and the necessity to call a conference, I was glad to notice that the Prime Minister has become converted to our policy when he mentioned, in a recent press release, that he believed in the necessity for establishing a secretariat of federal-provincial relations.
Indeed, Mr. Speaker, that is only one matter where our influence has been felt, and the opposition has had a great deal of influence this session. It has been able to get the government to correct, so some extent, numerous mistakes it has made; but as has been said by the hon. member for Winnipeg North Centre (Mr. Knowles) it is very hard to keep up with the government because it keeps repeating them. However, we rejoice at this repentance, on the part of the government and are particularly glad that it sees the merit of our policy with respect to dominion-provincial relations.
I know all members of the house have received correspondence and resolutions from municipalities and trade unions representing municipal employees who have been very concerned about the unfortunate delay in the presentation of this legislation to the house.
I think it has been very fortunate that the government was able to get agreement at the federal-provincial conference and was able to bring this legislation before the house again prior to the adjournment, because in the correspondence I received, and I know other hon. members received similar correspondence, it was indicated that the government's stock was dropping lower and lower because of the delay connected with this legislation.
Municipal Development and Loan Board
I shall not repeat what has been said by the hon. member for Burnaby-Richmond (Mr. Prittie) who presented our point of view, except to say-I speak now as a democratic socialist-that I realize this is only a poultice on the ulcer of unemployment, and we want to make the poultice as large as possible. Our metaphors become quite mixed at times, but I would add that this is a step in the right direction. However the total amount is completely insufficient to meet the needs of the immediate months ahead. We shall have to think in broader terms than the terms of this bill. We welcome it, as it will have a limited effect on the unemployment situation, but I would point out that there has been no fundamental change in the unemployment situation, since the election of the government, as compared with that situation last winter!
I make one more plea to the minister. I notice he is listening to me and I feel somewhat complimented in that respect. My plea is that the bill refers entirely to municipalities, while under the old winter works program the former government did make loans to bodies that were not municipalities, such as irrigation districts, water boards and other organizations of that type. If this legislation is to be of benefit to these smaller districts and organizations, I would urge the government to give consideration to the continuation of the policy commenced under the former government in the winter works program, namely the granting of loans to such organi-! zations that are proven financially sound, that are socially desirable and are under good' administration.
I hear one of the hon. members on the government side applaud. You know, Mr. Speaker, we often have things in common, and when we bring out something based on our experience we often find it meets the approval of members on the back benches opposite. This heartens us, and they have only to pluck up a bit of courage to support us.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon Mr. Lamoureux in the chair.
On clause 1-Short title.
Gordon Minto Churchill: I appreciate that the minister has a very important engagement right now, but on a previous stage he mentioned that he had a number of amendments to propose, and it may be that we would not reach all of them tonight. Could we have a preliminary indication of how many amendments there are, and the nature of them? I do not know whether this is convenient or not, but it would be helpful to the committee rather than having them brought to our attention as we deal with each clause.
2g28	HOUSE OF COMMONS
Municipal Development and Loan Board Mr. Gordon: In my opening remarks on second reading I gave a general description of the nature of the amendments, but perhaps I might mention them clause by clause. There is an amendment to clause 2.
subclause 2 of clause 7, and also subclause 3 of that clause. There is an addition to clause 8. There are some minor changes to clause 11. There is an addition to clause 13. There is a minor amendment to clause 14.


Mr. Smith:: Which part?


Thomas Clement (Tommy) Douglas: Is that paragraph 2?


Walter Lockhart Gordon: No. The amendment to clause 2 is on line 19, and then there are very minor changes on line 1 of page 2 and also on line 7 of the same page.


Gilles Grégoire: Will we have the French version?


Walter Lockhart Gordon: I shall have to get that, but I will give it in English first and try to get the French version in a moment. The next, amendment is to clause 7 and is a very extensive change.


Thomas Clement (Tommy) Douglas: Before the minister leaves clause 2 could he point out what the amendment will be so that we can mark it in our copies?


Walter Lockhart Gordon: By striking out line 19 on page 1 and substituting the following: "mu-
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llicipai UUiaj nw VV v Cl	

 

unincorporated local authority as the governor in council may hold to be a municipality for the purposes of this act."


Marcel Joseph Aimé Lambert: Might I suggest a precedent to the minister. I think hon. members will recall a certain instance in the fall of 1957 when, at this same stage, rather extensive amendments, as they said, were introduced into the Agricultural Stabilization Act. A mimeographed copy of the amendments were circulated so that we had them all before us.
I am afraid that notwithstanding the great courtesy of the minister at this time we would be writing here for the next 20 minutes, and we are not quite that fast; we have not shorthand.


Walter Lockhart Gordon: There are seven or eight copies here. We do not have mimeographed copies available. I have made inquiries before and understand that the mimeographing facilities of the federal government are not quite as up to date as perhaps they might be, and it takes some time to get these things.


Marcel Joseph Aimé Lambert: On that occasion it took a matter of an hour and a half.


William Arnold Peters: Send your secretary up to my office. I have a machine.


Gordon Minto Churchill: We once had headquarters mimeograph the economic report.


Walter Lockhart Gordon: I think, Mr. Chairman, I might just indicate the clauses rather than give the details. There is an important change to


Gilles Grégoire: Which one, ours?


Walter Lockhart Gordon: There is a minor change to clause 15, and a minor change to clause 21. The major changes are in clauses 7, 8 and 13.


Thomas Clement (Tommy) Douglas: Mr. Chairman, I think the amendments which the minister is proposing will do a good deal to improve the legislation which he is piloting through the committee. We can discuss the items one by one when we come to them. However, I do think the minister and the government are to be complimented that they were willing to make the changes which were requested by the provincial premiers, particularly the two major ones, one of which was placing the screening process of these loans in the hands of the provincial authorities.
The provincial governments are in a much better position to know the needs and potentialities of the municipalities. They are in a much better position to screen these applica-
. .	.	[DOT] - xi- _	rtAtiornmonf TVl PV
lions mail jis tixc icuwui	

 

have all the machinery in their departments of municipal affairs and they are close to the needs and problems of the municipalities.
I think it was a very wise move to turn oyer to the provincial governments the handling of the allocation of this money to the municipalities. Had the government not done this there would have been the danger that the large urban centres would have grabbed the major part of this fund and when the smaller communities turned up to apply for loans the fund would already have been emptied.
I think the idea of broadening the type of municipal projects to include schools, hospitals and such other projects as may be included at the discretion of the provincial governments helps considerably, because there is such a diversity in the needs of the municipalities across Canada that you cannot lay down hard and fast rules. I think the minister was very wise to make this change.
While I think we all recognize that much of the difficulty could have been obviated had the provinces been consulted in the first place, there is not much use crying over spilt milk. But I think it ought to be a lesson to all of us that consultation with the provinces should become a matter of course rather than an afterthought following the introduction of legislation. I know, of course, that the government was under pressure. This is one of the major pieces of legislation designed by them to promote employment, and they were anxious to get on with it; but this is a case of more haste, less speed. I think the fact

that they consulted with the provinces has resulted in very marked improvements in this piece of legislation.
The minister talked the other day about going to Washington and said he may be away for part of tomorrow. It seems to me that before he goes he might give some thought to the question of whether one or two other amendments might be considered. I am not going to take the time of the committee discussing what I think is a broad weakness of the legislation. I think that as legislation to promote employment this will not be tremendously effective, and it can only be a very small patch on a very sick economy. If we are really going to tackle the problem of unemployment and promote economic growth, we will have to adopt a much better co-ordinated and more far reaching program than this. However, Mr. Chairman, I am not going to discuss that now.
I think there are three basic weaknesses in the legislation even after it has been subject to these very commendable changes. The first, as has been mentioned by many hon. members, is that the amount of money available for the next three years is too small. I do not expect the minister to make a change in the amount now, but I hope that before the debate is finished he will give some assurance to the house that if in the first year or two there is a tremendous run on this fund the government will give consideration to increasing the amount. In other words, I hope the $400 million will not be split into three parts and as soon as one third is used up in the first year the government will say there is no more money till next year. I would hope they would be prepared to process applications, if they come in, and if the $400 million is used up quickly, that they will be prepared to come back to parliament and ask for more money. I hope this will be done, because I do not think there is any doubt about the fact that this sum of money is totally inadequate to meet the aim which the bill proclaims and is designed to meet, namely the promotion of employment.
The second weakness, as I see it, in the legislation is that the amount of money which the municipalities must put up is much too large to achieve the kind of results the minister has in mind. As I understand it, under this measure when enacted a municipality will be entitled to borrow up to two thirds of the total cost of a project. That leaves the municipality with the task of raising, first of all, in cash or some other means one third of the cost, and paying 75 per cent of the balance assuming they can get a 25 per cent forgiveness by qualifying under that provision. This really means that out of the entire cost of a project
Municipal Development and Loan Board the municipality must put up 84 per cent and the government of Canada puts up 16 per cent. This is a very large percentage of the cost for the municipalities to bear. The minister shakes his head. Am I wrong about that?


Walter Lockhart Gordon: Under this program, Mr. Chairman, the federal government will put up two thirds of the total; it is not a question of the municipality having to borrow 75 per cent.


Thomas Clement (Tommy) Douglas: No.


Walter Lockhart Gordon: Then I misunderstood the hon. member.


Thomas Clement (Tommy) Douglas: Let me restate it. As I understand it, Mr. Chairman, the municipality can borrow two thirds of the total cost of any project. That leaves the municipality first with the task of raising one third. Then it must repay 75 per cent of the other two thirds. So that of the total cost of the project the government of Canada will be putting up 16 per cent and the municipality, through the cash it raises and through the loan which it must repay, puts up the balance of 84 per cent. This is a very heavy burden to place on a municipality when we, the parliament of Canada, are asking them to contribute to the solution of unemployment.
I think many of the municipalities which are in serious financial straits will think twice about undertaking a project, 84 per cent of the total cost of which will ultimately come back to them, plus, of course, interest. I think that something larger than two thirds of the cost of a project should be lent to the municipalities, and I would hope that the government would give some thought to that in clause 9. It seems to me that two thirds is much too low and that the government would be justified in lending 75 or 80 per cent of the cost of a project.
I think the other weakness in the bill has to do with the provisions which are to be found in clause 7, which limits this program to those projects which were not contemplated by the municipalities. In other words, the test whether or not a municipality will qualify is not whether it has unemployment. It is not whether it is in need. The test is whether or not the project is a new program and will create employment. In other words, the municipality must show that the project in question was not in contemplation before. It is quite conceivable that a municipality which had had a serious unemployment problem has budgeted to spend every dollar it can raise and every dollar it can borrow in order to implement the maximum amount of public works. That municipality cannot add to its program, and is unable to find the other one third. If it tries to drop some of the projects
2930	HOUSE OF
Municipal Development and Loan Board it has already contemplated in order to get new ones so that it can qualify, under clause 7 it will find that those projects will not be approved. They must be new projects, not projects brought in to replace those already on the municipality's agenda.
I think this is going to be a very serious restriction. I think there are a lot of municipalities which will want to borrow money from the fund but will find they are not eligible, simply because the projects for which they are asking for money are those which they already had in mind. I see no value in ruling out those projects because they had been on their program. After all, what does the government want? It wants to get these municipalities to put as many people to work as possible and employ as much social capital as possible in order to create employment. Does it matter to the government whether this is a new project or a project which the municipality had in mind previously? Therefore I urge the minister to take another look at clause 7, so that if he is not here tomorrow whichever minister is piloting the bill through will be able to indicate whether or not snmp flexibility can be introduced in this clause.


Walter Lockhart Gordon: Mr. Chairman, if I might reply briefly to the remarks of the hon. member for Burnaby-Coquitlam, I should like to thank him first of all for his opening remarks about the desirability of flexibility in all conferences. I quite agree that there is not much point in having a conference if one side is unwilling to accept good ideas put forward by other parties to the conference, and as far as this government is concerned I hope we will never be guilty of being unwilling in such circumstances. As a matter of fact, I think that the conference last week end was a success, as was evidenced by all the provincial premiers having gone there with open minds.
On the three points raised by the hon. member, as to the limit, first of all, of $400 million I can assure him that if this program is a success and results in decreasing unemployment appreciably this government will certainly keep an open mind with regard to coming back to parliament for further appropriations. There is no suggestion that this particular sum should be divided in any way over the period. I think it is fair to say that our concern originally was to get the money, or a substantial portion of it, spent before next winter or during next winter. Now that the enthusiastic co-operation and approval of the provinces has been assured, I feel a lot happier and more confident that at least an appreciable part of this sum will be spent fairly soon.


I think we all recognize that municipalities have programs and limit themselves to those programs. It is difficult for them to change them during the course of the year. Nevertheless we are hopeful, and our hope is increased now as a result of the conference last week end, that advantage will be taken of these funds which will be available and that they will result in additional capital projects this winter as well as additional jobs.


Thomas Clement (Tommy) Douglas: Just on that point, the fund will not be broken up into fiscal years?


Walter Lockhart Gordon: No. The second point raised by the hon. member had to do with whether or not it was reasonable to lend municipalities only two thirds of the amount involved and to forgive only 25 per cent of the amount lent. This matter was pretty carefully gone into in the first place before the bill was presented. The view of the government then was, and I think I can say still is, that it was reasonable to expect the municipalities to put up some of the money. In fact they would be putting up a substantial percentage of their own money. We should not be asked to lend the full sum required. I should explain that any money they obtain from winter works or provincial grants comes off first; this comes off the top and they then get two thirds of the balance. It was felt that 25 per cent forgiveness would represent a substantial inducement to take advantage of these funds. As the bill passes through committee stage there is no doubt that those who are piloting it will indicate what 25 per cent forgiveness represents. The figure I have in mind, at an interest rate of 5 per cent over a 25-year period, would be the equivalent of an interest rate of about 2 per cent; so it does represent a pretty attractive inducement to anyone in a position to borrow money. I might add that during the conference last week this point was not raised. I thought it might be, but none of the provinces raised the question whether the two thirds should be increased or whether the 25 per cent forgiveness was sufficient. The hon. member for Notre Dame de Grace has pointed out that he has raised it with me before. I would say that he has raised it with me at least 50 times but has not yet convinced me that it would be a good thing to do.


Thomas Clement (Tommy) Douglas: Perhaps I might just say this. As far as technical schools are concerned, the federal government goes up to 75 per cent, as it does on winter works incentive programs. Would there not seem to be a good case for lending 75 per cent of the cost of a project here? Two thirds is lower than anything I have known by way of a loan from the senior government.


Walter Lockhart Gordon: I would not like anybody to think that this is the only item being put forward to deal with unemployment. It is one of a series of items which have been proposed and in this case, as it deals with particular projects which municipalities are anxious to get ahead with, it was felt this was reasonable. I want to link it with the hon. member's third point. He questioned whether loans should be limited to additional projects entered into by the municipalities. I gathered from what he said that he thought perhaps there might be a case for lending these amounts to municipalities in respect of existing projects. It would seem to me that this would defeat the purpose of this bill which is to encourage additional works or to encourage additional employment. It is not the purpose of this bill primarily, or even indirectly, to ease the financial plight of the municipalities.
We cannot have it both ways. The provinces feel strongly that the municipalities are not subject to federal jurisdiction, as all hon. members of this committee fully appreciate to be the case. Depending on which province one comes from, the municipalities are designated as daughters or, in other cases, as creatures.


An hon. Member:: "Creatures" in British Columbia.


Walter Lockhart Gordon: It was pleasanter to hear them referred to as daughters of the province, even though they might not all be receiving the attention which daughters usually receive from their fathers. Nevertheless, the provinces made it clear that the federal government has no jurisdiction over the municipalities and the question of their finances, good, bad or indifferent, is the direct responsibility of the province concerned and of no one else. So at this point the emphasis is naturally on additional employment. To be consistent it must, therefore, be on additional capital works, not on the financing of projects which would be undertaken anyway. I might say that the premier of a province with which the hon. member for Burnaby-Coquitlam is very familiar raised this point indirectly and it was made clear in the course of discussion that if municipalities have a long term capital program ahead of them and they speed it up-if they do something in the first or second year, for example, which they would normally have done in the fourth or fifth year-the additional amount of work in the first or second years would qualify under this program. This is a short term program and what we are concerned about is more jobs this winter and next year.


Thomas Clement (Tommy) Douglas: I thank the minister for his statement. All members of the house are interested in the creation of jobs. The only
Municipal Development and Loan Board concern I have is that the restriction which limits this assistance to two thirds of the cost of the project, together with the restriction applying it to new projects only, may prevent work which would otherwise be carried out from being implemented.


Walter Lockhart Gordon: I suggest that the hon. member has a good point when he talks about the proportion of two thirds, but I think he is inconsistent as to the second point, because if the projects are already financed, and are to be undertaken anyway, there is not much point in the federal government moving in and financing them as far as additional employment is concerned.


Thomas Clement (Tommy) Douglas: Except that maybe the municipalities will not be able to go ahead with programs they have planned if the money market situation is at all difficult. But I agree that if they had planned their programs and arranged their financing there would be no. special benefit about resorting to this fund except, of course, the lower rate of interest. Nevertheless, before a municipality could take on an additional project it would have to find one third of the money. If they could not do so, they could not go ahead with the project and the minister's object would not be attained.


Walter Lockhart Gordon: I am delighted the hon. member has referred to the state of the money market because, as members of the committee know, this is something which it is my responsibility to be talking about tomorrow. I am grateful to members of the committee for excusing me this evening from taking part in further discussion of this bill in committee and for agreeing that the Acting Minister of Finance can take over in my place. I have told him I am sure that members of the committee will give him the co-operation and help they usually give me when I try to pilot bills through committee, so his task will not be too difficult. On this note, if hon. members will excuse me, I will say good night, Mr. Chairman.


John Whitney Pickersgill: I wonder if I might make a suggestion to the committee which has been made to me by the hon. member for Winnipeg South Centre, that is, that we should not proceed this evening beyond the conclusion of clause 1.


Gordon Minto Churchill: Not necessarily the conclusion of clause 1.


John Whitney Pickersgill: Well, if there are some general observations to be made on clause 1 we should hear them, and then report progress on this bill so that mimeographed copies of the amendments could be made available
2932	HOUSE OF
Surcharge on Imports Order to all hon. members first thing in the morning. This, we believe, will greatly facilitate the consideration of the amendments tomorrow.
The hon. member for Winnipeg South Centre then suggested that he, for his part, was agreeable to our taking Bill No. C-88, to dealing with the second reading of that bill and getting into committee on it, and then calling it a day until tomorrow. If this program, which the hon. member has suggested and which I am very glad to accept from him, could be carried out by the committee and the house it would probably make it possible for us to complete our work tomorrow.


Horace Andrew (Bud) Olson: We certainly agree with the suggestion made by the Secretary of State. I should like to ask him whether, in the mimeographed sheets to be distributed tomorrow, he would include the amendment suggested by the hon. member for Lapointe?


Gordon Minto Churchill: We may have a series of amendments too.


John Whitney Pickersgill: If the hon. gentleman would do his own mimeographing we would be glad to have them circulated.
Mr. Grerfoil*e: I will undertake to do that.


Stanley Howard Knowles: I think there should be some understanding about the time element. The .Secretary of State has said that after conclusion of discussion on clause 1 of this bill we should take up Bill C-88. I would not want to do that if it was 2.00 a.m. Perhaps we should have some time limit.


John Whitney Pickersgill: I would not think of being so inhumane as to suggest that the committee sit into another day.


Gordon Minto Churchill: On Bill No. C-88 all I would expect tonight would be a statement by whatever minister is introducing it. We will reserve any reply or statement on our part until the first clause in committee of the whole house.


John Whitney Pickersgill: It will be the Minister of -Justice who will be moving that bill.
Clause 1 agreed to.
Progress reported.



FINANCE


Lionel Chevrier: the second reading of Bill No. C-88, respecting an order of His Excellency the Governor General in Council entitled the surcharge on imports order, and to restore certain rates of customs duties and tariff benefits expressed to be withdrawn thereby.


He said: Mr. Speaker, on June 24, 1962 the governor in council passed the surcharge on imports order under the authority of the Customs Tariff and the Financial Administration Act and made an amendment to the import control list under the Export and Import Permits Act. The first order resulted in increased tariffs on certain goods and the second reduced the value of goods that might be brought back by travelling Canadians free of duty.
Section 4 of the Customs Tariff, Revised Statutes of Canada, 1952, chapter 60, empowers the governor in council by order to withdraw rates of customs duties more favourable than the general tariff and to withdraw the benefit of any tariff more favourable than the general tariff. These powers are unrestricted. There is nothing in the act describing any special circumstances or conditions under which they might be exercised.
Section 22 of the Financial Administration Act, Revised Statutes of Canada, 1952, chapter 116, empowers the governor in council, on the recommendation of the treasury board, to remit any tax, fee or penalty whenever he considers it in the public interest. The section defines a tax as including any tax, impost, duty or toll and provides, inter alia, that a remission may be total or partial and may be granted in any particular case or class of cases and before the liability therefor arises.
There has been some doubt about the validity of the order passed under this item and, as the house knows, there are cases now before the courts. I should have added that there is doubt as to the validity of the order because in the opinion of justice it should have been approved by parliament. The object of this bill is to validate in parliament what was done at the time.


Stanley Howard Knowles: Mr. Speaker, we can make most of the comments we wish to make on this bill when we get into committee, but before it is given second reading there are one or two things that I think should be said. The concluding words of the Minister of Justice (Mr. Chevrier) are most interesting. If I heard him correctly he said that it is the opinion of justice-I presume he means the Department of Justice-that the order in council of June 24 of last year should have had the approval of parliament. Yet during the last session of parliament, the only session of the twenty fifth parliament, we were told several times that it was the opinion of justice, the same Department of Justice, that no such parliamentary approval was necessary.

I hesitate for a moment in case I have misquoted the present Minister of Justice, but if I have quoted him correctly this is a pretty serious situation. We are in effect being told that the Department of Justice gives one piece of advice one year and another piece of advice the next year. I happen to agree with the advice that is now being given, and if parliament accepts the necessity of passing this bill to validate this legislation it will mean that parliament is concurring in the view that the order in council of June 24, 1962, certainly lacked validity.
I feel in this session, as I felt in the last session, that it was a very serious departure from parliamentary practice and parliamentary tradition when the surcharge order in council of June 24, 1962 was passed, and the seriousness of what was done was compounded when the government of that day refused to bring the matter before parliament and refused even to refer the matter to the Supreme Court of Canada as we requested at that time. It makes the whole business very messy, and this sort of nibbling away at the practices of parliament is not good for democracy.
The Minister of Justice has referred to the contention that was implied in the passing of the surcharge order in council, namely, that the government of that day had the right under one statute to raise customs duties and then the right under another statute to reduce those same duties to the particular levels that that government wanted. We contended in the last session of parliament that in effect what the government of that day had done was to impose taxation without parliamentary approval, and if there is one thing that is most basic to the relationship between parliament and the executive and is a basic relationship of long standing it is that taxation cannot be imposed without parliamentary approval.
The Minister of Justice referred to the section of the Financial Administration Act under which the order in council of June 24, 1962, purported to reduce those taxes which in the first place had been raised. We went over all this many times last year. It is clearly a section that provides for remission in kinds of circumstances that are not covered by the order in council in question. We pointed out last year that there is one subsection in section 22 of the Financial Administration Act that requires publication in the public accounts of all remissions over $1,000 granted under that section. When we asked the minister of national revenue in the last session if a report could be brought down showing these remissions, we were told that it would cost so many thousands of
Surcharge on Imports Order dollars to have this done because records were not being kept in that way. I am satisfied that any competent lawyer studying this matter and finding that subsection in section 22 of the Financial Administration Act, would realize right away that the order in council falls to the ground.
We are being called upon to deal with this matter in another way which I think I have to characterize with the same word I used a moment ago, namely that it is messy. There is a clear rule in our books that we are not supposed to deal with matters that are sub judice. This matter is before the courts. It has been taken to the Exchequer Court of Canada.
I remember very well that at one time the present Leader of the Opposition (Mr. Diefenbaker) asked the government of that day, which was headed by Mr. St. Laurent, to refer to the Supreme Court of Canada a matter that was being discussed here in parliament. Mr. Ilsley was minister of justice and he got into the argument. He established the point very clearly that we could not be dealing with the matter in two courts of the land, namely parliament and a federal court, at the same time. We are doing that. This question of the validity of the surcharge order in council of June 24, 1962, is before the exchequer court. Whether that court is sitting today or tonight does not matter. The fact is it is before the court and we are dealing with it here. We are, I say, violating one of the basic rules of parliament.
Yet, we seem to have no alternative because of the mess into which we have been put. We often hear it said that the courts are the guardians of our liberties, the guardians of law, the guardians of justice and so on. Here is something that has been referred to the courts; at least it has been taken to the court by parties that have been affected by it. If this legislation were not before us, we might get a decision from the exchequer court as to whether or not the surcharge order in council was legal, whether or not it was valid. I assume if we pass this measure the exchequer court might as well drop the case, and probably will, because there will be no point to proceeding with it. In this case the very serious issue of whether or not this surcharge order in council under which millions of dollars were collected, was valid will never be determined by the court. We will prevent that determination by taking the action we are taking now.
I recognize, as the Minister of Finance said when he gave notice some weeks ago that this measure was going to be brought before us, that we will be in a very awkward position if we do not pass this legislation. If the
2934	HOUSE OF
Surcharge on Imports Order courts were to rule that the order in council was invalid, then the government would have to repay this money to the companies that had filed their cases. However, the ultimate consumers who really paid the extra duty would never have a chance to get their money back. So, Mr. Speaker, as I say, the matter is a mess all around. It is the kind of thing that parliamentary and legislative bodies get into when they avoid following the rules, traditions and practices of parliament of very long standing. I am sure that despite the things that were said, despite the feelings we had about this matter in the last parliament, if the government of that day had brought the matter to parliament and let us decide upon it, we would have shown mercy and forgiveness towards the government for what it had done on June 24.
I know that when I heard the former prime minister announce on the night of June 24, 1962, that this was being done, I took it for granted the order was going to come before parliament. I thought we would have a chance to vote on it. I thought, although it was the sort of thing I was opposed to, we might have to vote for it. We were refused time and time again. T. for one from mv seat over there where my friend from Brantford is now sitting, asked the former prime minister to refer the matter to the courts to clear up this uncertainty. He said, there is no uncertainty; it will not be referred to the courts. The fact that there is uncertainty is now established by the fact the matter has been taken to the courts, and by the fact we are having to deal with it in this legislation that is now before us.
I say, Mr. Speaker, we cannot be too careful in the parliament of Canada about these basic rules. Frankly, what the Minister of Justice (Mr. Chevrier) said tonight in the course of his brief remarks puts this thing into an awkward position. We were told in the last session by the former minister of justice that the deputy attorney general and the Department of Justice had said that the surcharge order in council was in order. We were led to believe there was an opinion, but we could not get it. We are told in this session that there is no written opinion. We are told tonight by the present Minister of Justice that the Department of Justice now says there should have been parliamentary approval of that legislation. One of my colleagues behind me is asking whether the present Minister of Justice has a written opinion. I can get many written opinions to the effect that this surcharge order in council was invalid.
I think we are caught. There is nothing we can do about it. I believe we should at least realize the seriousness of the point. 

Parliament as a whole, not just the government, should go through what my friend from Kootenay West (Mr. Herridge) referred to a moment ago as a period of repentance. We should be in sack cloth and ashes over what was done to the traditions of parliament.
When we get into committee of the whole on the bill I wish to indicate that I shall seek to move an amendment to clause 3 of the bill because this bill does more than the title implies. The title implies that the bill simply validates the order in council of last June 24 and restores certain rates and duties. Then, there is a clause in the bill which amends the Customs Tariff Act. I draw attention to the fact that there is no reference to that in the title of the bill. That is not quite regular. If we are talking about keeping to the rules, let us keep to the rules even if we are trying to patch up a rule that was broken. I suggest that there should be an amendment to the title to include in it the fact that this bill is also proposing an amendment to the Customs Tariff. What bothers me, and I will deal with it more specifically when we get to clause 3 in committee of the whole, is that clause 3, as it is worded, suggests that, an order of the kind that we had on June 24 ought to be brought before parliament before six months. However, there is an implication in that clause that that kind of order in council, the same kind we had last year, would be valid for at least six months.
I do not believe this was a proper course of action last June 24. I do not believe it would be a proper course of action again to pass an order in council based partly on the Customs Tariff Act, by which duties are raised, and based partly on section 22 of the Financial Administration Act by which duties are lowered. However, the wording of clause 3 of this bill is such as to indicate that for six months such an order in council is valid. This whole thing we have been through points up the tremendous need for any government that is in power, whatever party it is, to remember that it is responsible to parliament, and that it does not have the right to do by order in council anything that is not clearly provided for in some statute of this parliament. It was not provided in the statutes of parliament on June 24 last year for the government of that day to do what it did. The fact that the matter has now been taken to the courts makes that clear, and also the fact that this government realizes it has to validate the legislation in case the court declares the order in council invalid.
I hope, as a result of this experience, we will plug that loophole. In fact, when we get to the committee of the whole the amendment I will propose will plug that loophole and

then I hope we will realize this kind of thing must not be repeated if we are to maintain parliamentary democracy in its proper level.
People generally were amazed at a thing like this when it happened last year, and it was a pretty trying experience in the house that we could not get the opinion of justice, the reasons or justification for the order in council, and could not get the matter referred to the supreme court. We were just told that it was proper, that there was no uncertainty, and all that sort of thing. This, incidentally, is something that seems to get into governments, that a government in power can do whatever it feels it has to do or wants to do. That is not true in our parliamentary democracy. The government and the executive can do only those things parliament gives them authority to do. That is a lesson about which we in the parliament of Canada must ever remind ourselves, and it is a lesseon that we simply must keep.


Gordon Minto Churchill: Mr. Speaker, I proposed that we would advance this bill through the second reading stage, and I said that so far as we were concerned the major reply would be made on committee stage. My hon. friend from Winnipeg North Centre exercised himself as to whether we would set a time limit tonight or whether we would go on until two o'clock, and I was afraid he was going to do that very thing. However, even with the opportunity to speak on committee stage, nevertheless he has taken 25 minutes tonight on second reading, at this late hour, and waxed righteously indignant over the bill.
We grant that this is a controversial item. The hon. member for Winnipeg North Centre (Mr. Knowles) said that we can do nothing about it, but I suggest to him that something can be done about it. This bill can be voted down tomorrow, or later, and if the N.D.P. and the Social Credit party vote along with us the bill will be defeated. Therefore there is something that can be done about it, instead of waxing so righteously indignant about it on this stage. The hon. member rethreshed a lot of old straw he talked about in the last session. He did this at very great length, and it is quite obvious that in the house tonight there is a sharp difference of opinion.
Although the hon. member for Winnipeg North Centre (Mr. Knowles) may condemn the former government and say it did something which was quite wrong, we reject that statement completely. We acted within the law.


Mr. Nowlan:: And on the opinion of Justice.


An hon. Member:: Produce it.


George Clyde Nowlan: And we have got it,
Surcharge on Imports Order


Gordon Minto Churchill: This is the nature of the debate which was gone through last session and obviously will be repeated this session, and I entertain some doubts as to whether the bill is going to pass the house tomorrow unless my hon. friend from Winnipeg North Centre will accept my suggestion of voting it down and disposing, not only of the bill but by chance dispose of the government at the same time-and what are the odds?
I am not going to impose on the house at this late hour, as my hon. friend did. I am going to leave it to the hon. member for Digby-Annapolis-Kings (Mr. Nowlan) to make the effective reply tomorrow that he will make to the statements made tonight.


Stanley Howard Knowles: Will my hon. friend permit a question?


Gordon Minto Churchill: Yes.


Stanley Howard Knowles: Does he want the house not to validate the order in council?


George Clyde Nowlan: It was validated years ago.


Gordon Minto Churchill: We don't require any validation by the present government.


John Whitney Pickersgill: It is by parliament.


Gordon Minto Churchill: Or by parliament to acts we did because they were sound and right. We stand by that and we will prove it to you tomorrow.


Stanley Howard Knowles: Parliament is superior to any government.


Gordon Minto Churchill: Even to members such as the hon. member for Winnipeg North Centre.


Mr. Beri Leboe (Cariboo):: Mr. Speaker, I am not going to detain the house, but I would like to pose a question tonight which can be answered tomorrow. I would like the minister to define, if possible, if there is in fact a difference between taxes and penalties. That is all I have to say.


Lionel Chevrier: Mr. Speaker, if there are no other speakers-


Mr. Deputy Speaker:: Order. It is understood that if the Minister of Justice speaks now he closes the debate.


Lionel Chevrier: I am going to try, in the few minutes at my disposal, not to introduce a contentious note in the debate. There were many of the things said by the hon. member for Winnipeg North Centre (Mr. Knowles) with which I agree. However, I shall not take the time of the house on those. On the other hand there are two matters which he has brought to the attention of the house which cannot go unrecognized or unchallenged. The first is that this matter is sub judice and therefore should not be discussed in the house.
2936	HOUSE OF
Surcharge on Imports Order
I have a great deal oi respect for the knowledge of the rules which the hon. member for Winnipeg North Centre generally exhibits in the house, but I would bring to his attention that that rule does not apply to a bill. That has been the experience down through the years in our parliamentary institutions, and I would like to refer him to May's sixteenth edition, page 400, where it is said, under the title, "Matters Pending Judicial Decisions":
A matter, whilst under adjudication by a court of law, should not be brought before the house by a motion or otherwise. This rule does not apply to bills.
Then a little further on in the same edition at page 457 under the title, "Matters Pending Judicial Decision" there is this:
Matters awaiting the adjudication of a court of law should not be brought forward in debate (except by means of a bill...). This rule was observed by Sir Robert Peel and Lord John Russell, both by the wording of the speech from the throne and by their procedure in the house, regarding Mr. O'Connell's case, and has been maintained by rulings from the chair.
I must also say, Mr. Speaker, that I have been in the house for a long time, I think longer than my hon. friend, and I have found possible, when m sitters 9.1*0 V'pforp thip court, to deal by means of a bill with another subject matter without referring to the matter which is before the court. That has taken place in the house on more than one occasion, and I have reference now in my own mind to a similar case when I held the office of minister of transport some years ago. So that to say when a matter is before the court it cannot be dealt with-yes, that is a fact, if you must of necessity deal with a case which is before the court; but I think we can deal with the matters in this bill without any reference to the cases that are before the court.
Next my hon. friend said some very uncomplimentary things about the Department of Justice, particularly when he stated in effect that when one government is in office it gets one piece of advice or an opinion, and when another government is in office it receives another piece of advice or another opinion. I do not know what transpired when the previous government was in office. All I know is this, that I made it quite clear in the house on more than one occasion that there was no opinion, no written opinion which had been brought to my attention the moment I arrived in this department. I have seen none. I have searched for it; I have not found it, and I have been informed by those who advise me that there is no such written opinion.


Gilles Grégoire: Mr. Speaker, would the minister permit a question?
[Mr. Chevrier.j


George Clyde Nowlan: Have you been advised that by your deputy minister of justice; may I ask that question?


Lionel Chevrier: Let us deal with the first question first.


Gilles Grégoire: The minister just said there was no written opinion; but is the minister or are the officers of the department of the opinion that an oral opinion was given to the former government on that question?


George Clyde Nowlan: There were both.


Lionel Chevrier: Mr. Speaker, in answer to the question I must say that all I could do in respect of the questions which were asked of me when I took over this office was inquire whether there was a written opinion. I have inquired as to that, and I have found none.


Thomas Clement (Tommy) Douglas: Mr. Speaker, may I ask the minister whether he has a written opinion now?


Lionel Chevrier: Yes, I have a written opinion now, Mr. Speaker. I have also discussed this matter not only with the deputy minister but with others, and am informed by the deputy minister that the only way to remove any doubt about the validity of the orders that were passed on June 24 and to make it valid is by an act of parliament. That is the reason this matter is before the house.


George Clyde Nowlan: Mr. Speaker would the minister answer my question. Has he been told by the deputy minister that he did not have an opinion verbally and in writing with respect to the validity of these orders in council?


Lionel Chevrier: My hon. friend should just hold himself in peace-


George Clyde Nowlan: I am asking a question.


Lionel Chevrier: -and not get excited in asking a question. I have already answered the second part of my hon. friend's question in stating that there was no written opinion. I now say to him that I have been advised by my officers that neither was there an oral opinion.


Gordon Minto Churchill: Mr. Speaker, could I ask the Minister of Justice this question. Would it not be advisable, in view of the general desire of members of parliament to have a recess, to postpone further consideration of this bill until we come back on September 30?


Gilles Grégoire: Mr. Speaker-


Lionel Chevrier: There is one question here, Mr. Speaker. The government has decided that under the circumstances that is the way in which, in its judgment and in the public interest, it should proceed and in so

far as I am concerned, I do not think that at this late date, having regard to the position in which we find ourselves with reference to this matter, it should be delayed but the house should proceed with it.


Gilles Grégoire: I rise, Mr. Speaker, because last year I was a member of this house and-*


Lionel Chevrier: On a point of order, Mr. Speaker-


Mr. Deputy Speaker:: Order. The Minister of Justice on a point of order.


Lionel Chevrier: Mr. Speaker, I have no objection to the hon. member asking questions, but if he is going to make a speech, I was told by the Speaker that the debate was being closed by myself, and I take it the hon. member will have every opportunity when we reach clause 1 to make any contribution he would like to make. He can do that when we reach that stage.


Gilles Grégoire: I rise on a question of privilege, Mr. Speaker. Last year I was a member of this house and we were told there was a legal opinion on that question. We took it for granted; we accepted that. Now tonight we have just heard from the Minister of Justice that there was no written or oral opinion given by the officers of the Department of Justice in respect of these surcharges imposed last year on June 24. Either there is a written opinion, or there is not.


Mr. Deputy Speaker:: Order. Will the hon. member kindly resume his seat.


Gilles Grégoire: I would state my question of privilege, then.


Mr. Deputy Speaker:: This is what I would like the hon. member to do.


Gilles Grégoire: My question of privilege is this-


Mr. Deputy Speaker:: Order. I would ask the hon. member to resume his seat or come as quickly as he can to his question of privilege.


Gilles Grégoire: My question of privilege is this. As a member of this house I would ask, have we been misled, yes or no? That is a question of privilege. Have we been misled, yes or no? One government says-


Mr. Deputy Speaker:: Order. The hon.
member is now making a speech. It seems to me he will have an occasion to raise this whole question when this particular piece of legislation is before the committee. He is asking a question of the minister, who has already made a statement concluding the
Surcharge on Imports Order debate, and I suggest very humbly that we should proceed and let the matter stand where it is now.


Gerald William Baldwin: Mr. Speaker, the minister said he would entertain a question. Can I ask him this question. Were statements of defence filed by the department to the claims which were made against the government?


Lionel Chevrier: Mr. Speaker, I am of the opinion that we can deal with this bill without referring to the matter that is before the courts.


Some hon. Members:: Oh, oh.


Lionel Chevrier: I take it the object of my hon. friend's question is simply to-


An hon. Member:: To get the truth.


Lionel Chevrier: No. I have no objection to answering questions which are valid, but it seems to me this question is aimed at a clear discussion of a particular matter which is before the courts, and I have no intention of dealing with that type of question. In order to answer the hon. member's question I would have to inquire what the legal officers have done in so far as a defence is concerned.


Gerald William Baldwin: Mr. Speaker, I had no intention of trying to introduce any discussion of the matters which are now before the courts. I simply wanted to find out whether a defence had been filed, which would indicate that the department had denied liability.


Lionel Chevrier: Mr. Speaker, this question and others that have been asked are, as the house knows, questions which are normally asked when we are in committee, and not when the Speaker is in the chair. If the questions are persisted in, I have no objection; I think I should answer them to the best of my ability; but I feel those are questions we might deal with tomorrow.


Paul Raymond Martineau: Mr. Speaker, there is one question I would like to ask the minister. Is the government bringing forth this legislation because it feels there is a doubt in regard to these surcharges, or because it is convinced that the surcharges are illegal?


Lionel Chevrier: Mr. Speaker, it is quite clear this is another of those trap questions which-*


Paul Raymond Martineau: Mr. Speaker, I rise on a question of privilege. The minister had absolutely no right to say that that was another of those trap questions.


Mr. Monteith:: You are right.


Paul Raymond Martineau: I asked the question because I think it is perfectly and completely relevant

Surcharge on Imports Order to the bill before this house, and the minister has adopted an absolutely arrogant manner, which I resent.


Some hon. Members:: Hear, hear.


Lionel Chevrier: Mr. Speaker, I should think the arrogance is rather from the other side of the house-


Some hon. Members:: Oh, oh.


Lionel Chevrier: -because there is no doubt about it; my hon. friend has no privilege on a question such as that.


Mr. Deputy Speaker:: Order. Perhaps the hon. gentleman will allow me to intervene. I am just wondering whether we are straying substantially from what we agreed we would do earlier this evening. If the house would [DOT]allow me to say a few words, I understand it was the intention not to embark upon a substantial, lengthy or protracted debate on this question. We have perhaps strayed from this [DOT]original intention and I would very much like to put the question to the house.


Paul Raymond Martineau: Before you do that, Mr. Speaker, with all respect, I asked what I thought was a perfectly legitimate question *of the minister The minister got a bit incensed and replied by saying it was another of those trap questions. Naturally I resented that and I exercised my right to raise it as a question of privilege. As far as I am concerned, the matter is closed. I would nevertheless like the minister, if he is in a position to do so, to give an answer to this question because I think it has importance.


Lionel Chevrier: I am sorry if my hon. friend was incensed because I used the word "trap". I thought that was the object of his question, hut in the light of what he has said perhaps I might answer tomorrow.


Mr. Deputy Speaker:: Is it the pleasure of the house to adopt the said motion?


Gordon Minto Churchill: On division.
Motion agreed to and bill read the second time.


Mr. Deputy Speaker:: When shall the said bill be considered in committee of the whole? Next sitting of the house?


Some hon. Members:: Agreed.


John Whitney Pickersgill: Mr. Speaker, before we conclude our proceedings for today the suggestion has been made to me, which I have canvassed with hon. gentlemen opposite, that it might greatly facilitate the consideration of the municipal development and loan board bill in committee if, without its constituting a precedent or in any way being regarded as a regular proceeding, the house might order
[Mr. Martineau.l
that the bill be reprinted for the consideration of the committee with the amendments which were circulated to some hon. members this evening in mimeographed form, so that a bill in printed form thus amended would be available tomorrow. I recognize at once that this is a very unusual proceeding, though I believe there was an occasion in 1957-I was reminded of this by the hon. member for Winnipeg South Centre (Mr. Churchill)- when to meet a similar convenience this was done. If it would be the general view of the house that this would facilitate debate, could it be so ordered?


Gordon Minto Churchill: Mr. Speaker, in 1957 there were fewer amendments and the bill was perhaps not as wide-reaching as this. The only reason we are prepared to agree to this proposal is because of the approaching end of this part of the session; otherwise we might be discussing whether or not the bill should be withdrawn and re-introduced in all its stages once again. Under the circumstances and without creating a precedent I think it would be helpful to the house during the next day or two to have the bill reprinted as suggested.
Ai-. iv/r,. c*v/xnir*w
*'**[DOT] wiaviit xui.	vv v- ugrV/V, bu uuo,
Reference has been made to a precedent in 1957 and we think it would be a convenience to hon. members to have the bill in revised form.


Stanley Howard Knowles: We agree.


Marcel Joseph Aimé Lambert: Mr. Speaker, in this regard might I suggest to the Secretary of State (Mr. Pickersgill) that the reprinted bill be so identified as a reprint?


John Whitney Pickersgill: I omitted to make that suggestion, which I should have made, and I am grateful to all hon. members agreeing to this procedure which I believe will facilitate the proceedings. I recognize fully how unusual this proceeding is and how undesirable it would be in ordinary circumstances.



COMMITTEES OF THE HOUSE

[Stage Direction]
Seventh report of standing committee on banking and commerce-Mr. Asselin (Notre Dame de Grace).
Ninth report of standing committee on miscellaneous private bills-Mr. Wahn.

Gordon Minto Churchill: Mr. Speaker, I should like to ask the house leader what hopes he has to express to us now with regard to the completion of the business tomorrow, and the order in which it will be approached.


John Whitney Pickersgill: First of all, I should like to say that this has been a red letter day in the history of parliament, and I want to say that rarely have I seen greater co-operation on all sides of the house. I think I express the feeling of every hon. member of the house when I say that one problem which has troubled us all for a long time does appear at last to be on the way at any rate to something better than has been the case before. I am very gratified by that and I hope it is a good augury for tomorrow.
I believe it would be possible to complete the business tomorrow if it could be understood that there would be the greatest possible flexibility with the sittings. If there would be agreement that we could resume our sittings at two o'clock, and if in the evening, after taking the hour between six and seven, we could agree to go on, within reason, it might be possible to finish. If it becomes impossible perhaps we would have to go over until Saturday; but if we could sit, within reason, as long as necessary we might complete the business. There is no business beyond what I indicated last night which has not been finished.
The first item we would take, I think, would be the third reading of the economic council bill so that it could go to the other place, because they have to complete this business too if we are to get away from here. The second item would be the third reading of the excise tax bill. The third item would be the municipal loans and development bill. The fourth item would be the bill we have now just been considering. Then there would be interim supply. If it is felt by any hon. members opposite that some different order so far as the last three items are concerned would facilitate progress, although I think we should take the third readings first in order to get some business to the other place, I would be quite happy to consider any sug-
Business of the House gestions with regard to changing the order.
I am told that there are some divorce bills which have completed their progress through the other place, and if in the few minutes that we have to wait at the end of the day for the hon. gentlemen and ladies in the other place to complete their work we could agree to deal with them, if the bills come over here,
I should like to ask that this be done.


Gordon Minto Churchill: With regard to the divorce bills I would say yes; we have agreed to deal with them if they reach this house. With regard to the order of business I would say yes, provided we do not get squeezed on interim supply and attempt to do it, say, at five minutes to two on Saturday morning. With regard to the hours, I prefer that we leave those flexible and we can decide how things are going tomorrow. The temper of the house was good today; if the weather remains cool tomorrow let us hope for the best.


Stanley Howard Knowles: We are in general agreement with what has been said by the leader of the house and by the hon. member for Winnipeg South Centre but I wonder if, for the convenience of hon. members, it might not be a good idea for us to know at least part of the hours of sitting tomorrow. I would suggest from eleven till one and from two to six. Then we might start the evening sitting, if one should be necessary, at seven o'clock. Let the rest of it be flexible.


Gordon Minto Churchill: The reason I prefer flexibility is this: I thought we could be out of here at 10.30 tonight but the hon. gentleman from Winnipeg had to make a 25-minute speech.


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


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Ref. No.
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Mr. Fisher-Q. No. 12
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National Capital Commission acquisition of land....
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15 Mr. Richard-Q. No. 337
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Acquisition of property, Sussex Street, Ottawa
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23
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Mr. Orlikow-M.P.P. No. 6... Relocation of Indians because of Power Development.
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33
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Mr. Valade-M.P.P. No. 22.... World Fair, Correspondence with Montreal Mayor
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34
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Mr. Valade-M.P.P. No. 23.... Montreal, Route of Trans-Canada Highway
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35
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Mr. Knowles-M.P.P. No. 28... Expenses of Candidates, 1963, Election
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36
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Mr. Horner-M.P.P. No. 29.... Correspondence respecting rail line abandonment....
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42
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Mr. Martineau-Q. No. 615....Assistants and Secretaries of Ministers
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45
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Mr. Grafftey-M.P.P. No. 19... Municipal Development and Loan Board
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'..
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46
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Mr. Martineau-M.P.P. No. 24.. Relating to Jointly Financed Programmes
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48
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Mr. Grafftey-M.P.P. No. 32... Dominion Provincial Conference
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49
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Mr. Grafftey-M.P.P. No. 33... Dominion-Provincial Fiscal Relations
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53
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Mr. Martineau-M.P.P. No. 37.. Unemployment Insurance-Extension to Highways Employees, Que
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54
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Mr. Coates-M.P.P. No. 39.... Trans-Canada Highway Construction, Atlantic Provinces.
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57
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Mr. Pigeon-M.P.P. No. 12.... Correspondence respecting World Fair
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58
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Mr. Stefanson-M.P.P. No. 38... Sales tax on building materials and machinery....
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59
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Mr. Orlikow-M.P.P. No. 42- Sales tax on building materials and machinery
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60
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Mr. Knowles-M.P.P. No. 43... Proposed extension of sales tax
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Cl
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Mr. Knowles M.P.P. No. id... Explanations of bud""'* ~rovir,i/>n"
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62
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Mr. Knowles-M.P.P. No. 45... Income Tax-Procedures respecting expense account deductions
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63
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Mr. Martineau-Q. No. 362.... Public Works Expenditures, Pontiac-Temiscamingue
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Constituency
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69
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Mr. Paul-Q. No. 850
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Public Works expenditures, Berthier-Maskinonge-Delanaudiere
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73
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Mr. Gregoire-M.P.P. No. 46... Sales tax on building material
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74
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Mr. Gregoire-M.P.P. No. 47... Withdrawal of 30 per cent tax on share sales
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75
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Mr. Pigeon-M.P.P. No. 49.... Acquisition by Quebec of Soulanges Canal
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78
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Mr. Martineau-Q. No. 491....Joint Federal-Provincial Programs
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79
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Mr. Valade-Q. No. 495
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Cancellation of Tender Calls
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80
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Mr. Orlikow-Q. No. 585
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Contracts with Fuller Construction Co. Ottawa
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81
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Mr. Orlikow-Q. No. 586
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Contracts with H. J. MacFarland Co. Ottawa
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82
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Mr. Fisher-Q. No. 591
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Report of Committee on Manitoba's Economic Future....
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84
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Mr. McIntosh-Q. No 829
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Persons posted or made available to Ministers, etc.
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86
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Mr. McBain-M.P.P. No. 54____ Cigarette smoking
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87
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Mr. Aiken-M.P.P. No. 58
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Telephone calls to Wood, Gundy Co
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88
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Mr. More-Q. No. 437
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Conditional and unconditional Grants to Saskatchewan...
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89
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Mr. Martineau-Q. No. 816....Protest against sales tax on building materials
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98
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Mr. Lambert-M.P.P. No. 55... Edmonton Municipal Airport
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99
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Mr. Martineau-M.P.P. No. 57.. Censure motion by Quebec Legislative Assembly
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100
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Mr. Basford-M.P.P. No. 61
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Canadian Centennial-Correspondence with B.C	
101	Mr. Basford-M.P.P. No. 63.... Lease of Portion of R.C.A.F. Station Vancouver.
102	Mr. Perron-M.P.P. No. 67.... Unemployment Insurance Benefits to Canadians in U.S...
103	Mr. Starr-M.P.P. No. 69	 Winter Works incentive program	
106	Mr. Matheson-Q. No. 1111.... Canadian participation in military operations...
June 3 June 10 June 12 June 19 June 19 June 19 June 19 June 26 June 26 June 26 June 26 June 26
June 26 June 26 July 3 July 3 July 3 July 3 July 3
July 3
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July 10 July 10 July 10 July 10 July 15 July 15 July 15 July 15 July 15 July 15 July 17 July 17 July 24 July 24 July 24 July 24 July 24 July 24 July 24 July 24 July 31
[Stage Direction]
Friday, August 2, 1963