1964-09-21

Mr. John R. Maiheson (Leeds) moved: for leave to introduce Bill No. C-122, to amend the Canada Evidence Act (privileged communications).


Some hon. Members:: Explain.


John Ross Matheson: Mr. Speaker, the purpose of this bill is to amend the Canada Evidence Act by inserting therein new sections to extend a privilege on communications between members of the public dealing with members of the clergy, the medical profession and social workers acting in their professional capacities. This is in accordance with the report of the committee on privileged communications to the Ontario civil justice subsection of the Canadian Bar Association.
The common law already confers a privilege from disclosure with respect to communications passed between a client and his solicitor. The rule is stated in Cross "Evidence" (1957), page 238.
The study and recommendations made by the Canadian Bar Association with respect to privileged communications have been spurred by the opinion expressed by Hon. Mr. Justice Stewart during the course of the trial in the case of Dembie v. Dembie in April, 1963. Mr. Justice Stewart expressed the opinion very clearly that a certain communication between i patient and her psychiatrist should be privileged from disclosure. However, there svas no formal ruling made by the trial judge is to whether the communications previously referred to were privileged. Therefore, quite tpart from the effect of the doctrine of prec-:dent, the learned judge's opinion cannot be considered as a ruling which has become embodied in the law.
Motion agreed to and bill read the first ;ime.
20220-521J



QUESTIONS

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

Mr. Soulham: 1.	How many instances has the Department of Public Works had in 1963 of identical tenders and how many to date in 1964?
2.	Have these cases been reported to the combines investigation branch of the Department of Justice?


Hon. J. P. Deschatelets (Minister of Public Works):: 1. In 1963, 87; to date in 1964, 52.
2.	Thirteen have been reported.


PROTECTION OP ANIMALS USED IN RESEARCH
Mr. Scott: 1.	Did the government receive a submission from the council for laboratory animals dealing with the subject of the protection of animals used in scientific research and, if so, when was such submission received?
2.	Does the government plan any action in this session with regard to the matters raised in the said submission?


Hon. Judy V. LaMarsh (Minister of National Health and Welfare):: 1 and 2. Yes. A submission was received by the Minister of Justice and Attorney General in July, 1963, and in September, 1963 was passed to the Minister of National Health and Welfare for consideration. The views of the interdepartmental committee which had been formed in 1961 were sought. It was generally agreed that no agency of the federal government had authority to institute licensing or inspection over the control of laboratory animals handled by universities or private interests engaged in research work. It was also agreed that legislation establishing any such system would not be within the legislative power of the federal parliament but rather of the provinces. The Minister of National Health and Welfare directed that all laboratories in her department follow as a standard the code of treatment for laboratory animals which was adopted by the Canadian federation of biological societies and indicated that consideration would be given to having that code, or some mutually agreed

Questions
new code, adopted to ensure humane treatment of animals in all laboratories operated by the federal government.


SUBCONTRACTS TO FAIREY AVIATION
[Stage Direction]
Question No. 1,785
Mr. Coates:: What was the estimated value of subcontracts received from prime contractors located in Canada by Fairey Aviation for the fiscal years, 1959-60, 1960-61, 1961-62, 1962-63, 1963-64?


Hon. C. M. Drury (Minister of Industry):: The department is informed by the company that the following figures cover subcontracts with a value of over $10,000 received during the fiscal years noted.
1959-60, $12,000; 1960-61, $917,000; 1961-62, $2,470,000; 1962-63, $1,509,000; 1963-64, $1,312-GOO.


CIVIL SERVICE SUPERANNUATION FUND
Mr. Cote (Longueuil): 1.	What is the present amount in the civil service superannuation fund?
2.	Where is such amount invested and at what rate of interest?


Mr. L. T. Pennell (Parliamentary Secretary to Minister of Finance):: 1. As at July 31, 1964, the balance in the superannuation account was $1,930,577,461.44.
2.	The superannuation account is a part of the consolidated revenue fund. Interest is credited in accordance with the public service superannuation regulations. This is done on the last day of each calendar quarter at the rate of 1 per cent of the balance to the credit of the fund on the last day of the preceding quarter.


DESALINATION OF SEA WATER
Mr. Howe (Hamilton South): 1.	Is the government conducting or supporting research on the desalination of sea water and, if so, at what institutions, and under whose direction is such research being conducted?
2.	What is the annual cost to the government of each of these projects?


Charles Mills (Bud) Drury: In so far as the national research council is concerned, the answer is as follows:
1.	The division of applied chemistry has a program devoted to the separation of various constituents from single liquid phases by reverse osmosis. The work is pertinent to the desalination of sea water but the latter is only a by-product of the major research program. The work is supervised by Dr. S. Sourirajan.

2.	The annual cost which can be ascribed to this portion of the research program is approximately $10,000.


DOMINION EXPERIMENTAL FARM EMPLOYEES
Mr. Cyr: At the dominion experimental farm of the Department of Agriculture (a) how many persons are casually employed (b) how many casual employees are French speaking (c) how many persons are permanently employed (d) how many permanent employees are French speaking?


Hon. Harry W. Hays (Minister of Agriculture):: Of the total number of Department of Agriculture employees located at the central experimental farm, Ottawa, (formerly dominion experimental farm) (a) 98 are employed on a casual basis; (b) 14 are French speaking;
(c)	1,245 are employed on a continuing basis;
(d)	199 are French speaking.


UNEMPLOYMENT INSURANCE FUND
Mr. Howe (Hamilton South): 1.	What is the present financial state of the unemployment insurance fund?
2.	What are its future prospects?


Hon. A. J. MacEachen (Minister of Labour):: 1. On August 31, 1964 the unemployment insurance fund showed a credit balance of $18,826,358.
2. It is expected that the contributions to the unemployment insurance fund will continue to increase the financial state of the fund until some time in December 1964. From approximately January 1965 during the heavy claims season it is expected that the outgo from the fund will exceed its income.


HAMILTON, ONT.  UNEMPLOYMENT FIGURES
Mr. Howe (Hamilton South): 1.	As of the end of August, 1964, what was the rate of unemployment in (a) Canada (b) Hamilton, Ontario?
2.	Of those unemployed in Hamilton, what proportion received unemployment insurance payments?


Allan Joseph MacEachen: 1. The precise information concerning the rate of unemployment is not available. The preliminary figures as of August 31, 1964 show that (a) in Canada there were 309,909 registrations for employment in the national employment service offices and (b) in the Hamilton local office area 8,592 registrations for employment,
2. The precise information concerning the proportion of unemployed persons in Hamilton, Ontario, receiving unemployment in-

Questions
surance payments is not available. The num- Newfoundland, ministers of transport have ber of active claimants in the Hamilton local never made it a habit to inquire from their office area on August 31, 1964 was 4,879.	colleagues about the purpose of their trips.


CIVIL SERVICE DEATH BENEFIT PLAN
Mr. Howe (Hamilton: South):
1.	Are federal civil servants required to subscribe to a death benefit insurance plan and, if so, how many are now so enrolled?
2.	What is the monthly premium and what has been the total paid by civil servants in the last year?
3.	How many beneficiaries collected in the last year and what was the amount paid them?


Lawrence T. Pennell: 1. (a) The supplementary death benefit plan provided under part II of the Public Service Superannuation Act covers on a compulsory basis all persons employed in the public service provided that (i) they were contributors under part I of that act on July 1, 1954 and did not elect not to participate under part II on or before November 1, 1954, and have continued to be so employed, or (ii) they have become contributors under part I of that act since July 1, 1954, and (iii) in either case, they are not employees of a crown corporation or public board excluded from the operation of part II of that act by the public service superannuation regulations, (b) There were 175,306 members of the plan in the category described in paragraph (a) on March 31, 1964.
2.	(a) The formal monthly premium for these employees is 10 cents for every $250 in the amount of basic coverage, (b) The total of their contributions in the fiscal year 196364 was $3,415,215.09.
3.	724 beneficiaries of persons in this category were paid $2,813,950 in the fiscal year 1963-64.


* OFFICIAL USE OF C.N.R. COACH &quot;ACADIA&quot;
[Stage Direction]
Question No. 1,88 7-Mr. Ricard:
Which minister of the crown made use of the Canadian National Railways "Acadia" coach on the week ends of August 22, 1964 and August 29, 1964, and what was the official duty discharged by the minister concerned on each of the dates mentioned?
Mr. Jean-Charles Canlin (Parliamentary Secretary to Minister of Transport):: For
many years now, coaches have been put at the disposal of ministers of the crown, when needed, and one of those, the "Acadia" was made available to the Minister of Forestry on the dates mentioned. Since those cars may be used to travel anywhere in Canada except in


CONSTRUCTION OF SUPERINTENDENT'S RESIDENCE, CAPE BRETON HIGHLANDS PARK
Mr. Muir (Cape Breton North and Victoria): Has the government any plans for the construction of a new residence for the use of the superintendent of the Cape Breton Highlands national park?
Hon. Arthur Laing (Minister of Northern
Affairs and National Resources): This matter is being studied at the present time but there are no plans for the construction of such residence.


CAPE BRETON HIGHLANDS GOLF CLUB
Mr. Muir (Cape Breton North and Victoria): 1.	What is the paid up membership of the Cape Breton Highlands golf club and what is the annual membership fee?
2.	What is the annual amount of revenue derived from the green fees for each of the years 1954 to 1964 inclusive?
3.	What was the estimated daily population using the facilities of the Cape Breton Highlands golf club house for the months of July and August,
1964?
4.	What is the estimated square footage of the Cape Breton Highlands golf club house?
5.	What is the estimated square footage of the lounge at the Cape Breton Highlands golf club
house?


Hon. Arthur Laing (Minister of Northern Affairs and National Resources):: 1. Thirty four; $2 per annum.
2.	This revenue is as follows: 1954; $3,966; 1955, $3,575; 1956, $4,362; 1957, $4,898; 1958, $5,910; 1959, $5,798; 1960, $9,859; 1961, 10,559; 1962, $11,680; 1963, $12,146; 1964, not yet available.
3.	Approximately 250.
4.	912 sq. feet of which 150 sq. feet is used for storage.
5.	155 sq. feet.


REPAIRS TO GOVERNMENT WHARVES, TOBERMORY, ONT.
Mr. Loney: Is the Department of Public Works considering any construction, renovation or repairs at the government wharves at Tobermory, Bruce county, Ontario?


Jean-Paul Deschatelets: The department is investigating a request for an extension to wharfage facilities in Little Tub harbour at Tobermory.

Orders for Returns


INTERNATIONAL COFFEE AGREEMENT
Mr. Mather: 1.	Is Canada a participant in the international coffee agreement?
2.	When did the agreement become effective?
3.	What was the price of coffee in Canada in the year prior to the agreement becoming effective?
4.	What is the price today?


Hon. Mitchell Sharp (Minister of Trade and Commerce):: 1. Canada has been a member of the international coffee agreement since November 20, 1962.
2.	The agreement became effective July 1, 1963.
3.	Canadian average retail price of coffee, 1 lb. bag, July, 1962, $.756.
4.	Canadian average retail price of coffee, 1 lb. bag, August, 1964, $.931.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. Coates: 1.	What are the names of the civil servants in all federal government departments employed in the constituency of York-Sunbury, New Brunswick?
2.	What position does each fill?
3.	What is the annual salary of each?
Return tabled.


NATURAL METHODS OF PEST AND WEED CONTROL
Mr. Howe (Hamilton South): 1.	Is the government conducting or supporting research on natural methods of pest and weed control, alternative to poison chemical control and, if so, at which institutions, and under whose direction is such research being conducted?
2.	What is the annual cost to the government of each of these projects?
Return tabled.


WINTER WORKS PROJECTS, NORTHWESTERN QUEBEC
Mr. Caouelte: 1.	What winter works projects were undertaken in Villeneuve county during the past season?
2.	What was the cost of such winter works projects and what part of such costs was to be paid for or was paid for by the federal government?
3.	Does the federal government still owe money to some municipalities in connection with such projects and, if so, what projects have not yet been paid for by the federal government?
4.	What is the total federal contribution outstanding with respect to such winter works projects in Rouyn-Noranda county?
5.	Has the government taken any steps to expedite the payment of any outstanding contributions

with respect to winter works projects in Rouyn-Noranda county and, if so, what steps have been taken?
Return tabled.



EXTERNAL AFFAIRS


[Stage Direction]
On the orders of the day:
Right Hon. J. G. Diefenbaker (Leader of the Opposition):: Mr. Speaker, I do not know to whom in the serried ranks of the government I should direct this question, but I should like to know whether the statement made by the premier of Uttar Pradesh, one of the largest states of India, that a great many of its population are in danger of starving because of the food shortage, has been brought to the attention of the government, and what action Canada is going to take in this regard over and above the $7 million at present provided under the Colombo plan for distribution there.


Mitchell William Sharp: Mr. Speaker, may I reply to the question put by the right hon. gentleman. As I said in the house the other day, the Canadian government has made known to the Indian government its willingness to help if requested. So far we have had no request from the Indian government for further assistance other than that now provided or planned.


John George Diefenbaker: And there has been no suggestion by anyone on behalf of the Indian government that assistance is peremptorily needed to meet an increasingly serious situation?


Mitchell William Sharp: Not as far as I am aware, Mr. Speaker. I will make inquiries to see whether there has been something during the last few hours of which I am unaware.


PUBLIC WORKS
[Stage Direction]
On the orders of the day:
Mr. T. C. Douglas (Burnaby-Coquiflam):: Mr. Speaker, may I direct a question to the Minister of Public Works regarding the army base at Churchill, Manitoba, which was closed and turned over to the Department of Public Works. I understand that this has a capacity for 350 families and that 100 of the married quarters are vacant. I want to ask the minister why it is not possible for Canadian and

American personnel working for the PanAmerican Airways to occupy these quarters; because I believe these people are living in very primitive conditions indeed.


Jean-Paul Deschatelets: Mr. Speaker, this is, of course, an important matter, and I think it would be better to wait till tomorrow at which time I will have all the facts to provide an answer.



UNEMPLOYMENT INSURANCE


[Stage Direction]
On the orders of the day:
Mr. Gilles Gregoire (Lapointe):: Mr. Speaker, I should like once again to direct a question to the Minister of Labour which I put to the Acting Prime Minister last week and of which the Minister of Labour was to be informed.
Could the Minister of Labour tell us whether he intends to intervene with the unemployment office in Montreal so that employees of the newspaper La Presse, who are now without work because of a strike in a section of that newspaper, may receive unemployment insurance benefits?


Allan Joseph MacEachen: Mr. Speaker, I have received notice of the hon. gentleman's question. It is true that the insurance officer adjudicating these claims has decided that the persons involved are not eligible for unemployment insurance benefits because of the particular work situation prevailing there. The employees affected have appealed this decision to the board of referees, and I understand that board is scheduled to hear these appeals at the end of the month, on September 30.


Gilles Grégoire: A supplementary question, Mr. Speaker.
Could the minister explain why the unemployment insurance appeal board was able to render a decision in the case of the Toronto newspapermen strike only three weeks after the strike began, while it has not been able to render a decision in the case of the Montreal strike, after three and a half months?


Allan Joseph MacEachen: Mr. Speaker, I understand that the insurance officer in Toronto decided in that case that the work stoppage had
Inquiries of the Ministry ceased, and that barring any other disqualifications the workers affected would be normally eligible for benefits. In this case the insurance officer has adjudicated that a work stoppage still exists. There is no indication that the work stoppage has ceased to exist, and the matter is now before the board of referees as provided for under the Unemployment Insurance Act.



BUSINESS OF THE HOUSE


[Stage Direction]
On the orders of the day:
Hon. Theogene Ricard (Si. Hyacinthe-Bagot):: Mr. Speaker, in the absence of the Minister of Transport I should like to put a question to his parliamentary secretary.
Could he tell the house why starred question No. 1,887 was allowed to stand last Wednesday, to be answered only today?


Jean-Charles Cantin: Mr. Speaker, that was merely due to a clerical error. We were supposed to have the reply on hand but at the last minute the minister and I realized that it had been left at the office.



ADMINISTRATION OF JUSTICE


[Stage Direction]
kinsmen's club
On the orders of the day:
Hon. Leon Balcer (Three Rivers):: Mr. Speaker, I should like to direct a question to the Minister of Justice.
Could the minister tell us whether he has received a request from the solicitor general of the province of Quebec, Hon. Claude Wagner, that the Royal Canadian Mounted Police-


Mr. Scott:: Mr. Speaker, on a point of order, the translation system is not working and we are unable to hear the interesting remarks of the hon. gentleman.


An hon. Member:: It is now.


Léon Balcer: Mr. Speaker, I wish to ask the Minister of Justice whether he can tell the house if the solicitor general of the province

Inquiries of the Ministry of Quebec has asked for the assistance of the R.C.M.P. in order to help the Quebec provincial police to arrest the 13 Kinsmen in connection with a lottery held at Pointe Claire?


Hon. Guy Favreau (Minister of Justice):: Mr. Speaker, I did not receive any such request from the solicitor general.



VETERANS AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, I rise bristling with indignation to direct a question to the Minister of Veterans Affairs based on correspondence I received this morning from residents of Robson, British Columbia, who are very concerned about the abominable treatment being given a war veteran over 80 years of age, whose property has been taken by the B.C. hydro authority. I bring this situation to the minister's attention at their request, and ask that he have some official sent into the district to protect the rights of these older veterans who are helpless in the face of this octopus.


Hon. Roger Teillel (Minister of Veterans Affairs):: Mr. Speaker, I presume by "authorities" the hon. gentleman is speaking of the British Columbia hydro authority.


Herbert Wilfred Herridge: That is right.


Roger-Joseph Teillet: At the moment I have no knowledge of this matter, but I certainly will make inquiries and have someone look into this situation to see what assistance can be given these veterans.



INQUIRY AS TO INCREASES IN PENSIONS

[Stage Direction]
On the orders of the day:
Mr. P. V. Noble (Grey North):: I should like to address this question to the Minister of Veterans Affairs. Is the minister giving consideration to increasing the pensions of war veterans, which appear to be inadequate at this time?


Roger-Joseph Teillet: I believe I answered a question about war veterans allowances and pensions two or three weeks ago in the house. I have nothing further to add at the moment.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Mr. Heath Macquarrie (Queens):: Mr. Speaker, I have a question for the Minister of National Defence. Would the minister advise why no units of the Canadian navy are participating in the important NATO fleet exercise beginning today?


Hon. Paul Hellyer (Minister of National Defence):: Yes, Mr. Speaker. The Canadian navy is committed for another exercise undertaken jointly with the United States of America, and consequently are unable to participate at this time in the naval exercise taking place off the coast of Europe.



INFORMATION RESPECTING INTEGRATION OF ARMED FORCES

[Stage Direction]
On the orders of the day:
Mr. Donald Maclnnis (Cape Breton South):: Mr. Speaker, I have a question for the Minister of National Defence. Will the information to be presented to the United States service officers in respect of the integration of the Canadian forces exceed the information already available to this house?


Paul Theodore Hellyer: No, Mr. Speaker.


Malcolm MacInnis: A supplementary question, Mr. Speaker. Does not the minister think he is wasting the time of our friends south of the border?


Paul Theodore Hellyer: No, Mr. Speaker.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. Lloyd R. Crouse (Queens-Lunenburg):: Mr. Speaker, I should like to direct a question to the Minister of Labour. In view of the fact that an article in the Halifax Chronicle-Herald. of September 18 states that the normal 900 man labour force at the Halifax shipyards has been reduced to less than 300 men since August 21, after three years of steady employment at the yard, will the Minister of Labour inform the house what plans his department will propose to provide employment for so many skilled personnel who have been trained over a long period of years?


Allan Joseph MacEachen: Mr. Speaker, I do not for a moment accept the numerous allegations of fact in the hon. gentleman's question, but I thank him for raising the matter and I will investigate to ascertain whether the allegations in his question are correct.


Lloyd Roseville Crouse: A supplementary question, Mr. Speaker. Does the minister state that the article in Friday's Chronicle-Herald, is incorrect?


Allan Joseph MacEachen: I have not said that.



D.E.W. LINE-STEPS TO AVERT STRIKE

[Stage Direction]
On the orders of the day:
Hon. Marcel Lambert (Edmonton West):: Can the Minister of National Defence advise the house what steps he has taken in conjunction with the Minister of Labour to avert the possibility of a strike on the D.E.W. line?


Paul Theodore Hellyer: I will ask my colleague the Minister of Labour to deal with this question. It is primarily his responsibility, and I believe he has received a report.


Allan Joseph MacEachen: As hon. members may know, the report of the conciliation board was received recently. The board had spent a lengthy period attempting to reach an agreed solution to the dispute between the Federal Electric Company and the international brotherhood of electrical workers. The report was received recently. It has been rejected by the union in question. There has been considerable activity in this matter over the week end. The union has not yet taken a strike vote. The Department of Labour is of course ready to assist at the opportune time in any effort to mediate in the situation.


Reid Scott: A supplementary question, Mr. Speaker. Have any representations been received from the United States or any of their officials for the minister to appoint a mediator to look into the dispute?


Allan Joseph MacEachen: I have received no representations as yet on this point.


Marcel Joseph Aimé Lambert: Mr. Speaker, I have a supplementary question for the Minister of National Revenue. In the light of the great distance from Ottawa of the D.E.W. line sites and the difficulty in communication, can the minister advise the house whether appropriate steps have been taken to man the D.E.W. line in an alternative manner in the event that there is a strike?
Inquiries of the Ministry


Paul Theodore Hellyer: Mr. Speaker, I presume the hon. member meant to put his question to me.


Marcel Joseph Aimé Lambert: Yes, Mr. Speaker.


Paul Theodore Hellyer: All I can say is that we have given some thought as to how the D.E.W. line could be operated in the event that a strike was called.


Marcel Joseph Aimé Lambert: A further supplementary
question, Mr. Speaker. Does this envisage any gap in its operation, in the event of a strike?


Paul Theodore Hellyer: I do not think it would be profitable to comment further. I have given the assurance that we have given this matter some preliminary thought. I think that is all I can usefully say at this time.



LOUISBURG, N.S.-LAY-OFF OF WORKERS AT HISTORIC SITE

[Stage Direction]
On the orders of the day:
Malcolm MacInnis: Mr. Speaker, I have a question for the Minister of Labour. I wonder whether the minister would use his influence with his colleague the minister of northern affairs in order to bring about a stop to the lay-offs at Fort Louisburg? While the minister is on his feet would he also assure the house that the original intent of this project, which was a make-work project for displaced miners, is still the policy of this government?


Allan Joseph MacEachen: Mr. Speaker, I would be glad to discuss, as I have already done, the project at Louisburg with the minister of northern affairs.


Malcolm MacInnis: A supplementary question, Mr. Speaker. Would the minister answer the last part of my question? Is it still the policy of this government that this project remains, as it was originally intended, a make-work project for displaced miners?


Allan Joseph MacEachen: Mr. Speaker, it is not customary to answer questions of broad policy on the orders of the day. I am sure my hon. friend will have observed from the hiring practices which have prevailed at Louisburg during the last year and a half that unemployed miners from various parts of Cape Breton have been given special consideration in this project.


Malcolm MacInnis: A further supplementary question. I did not understand whether the minister said the "hiring" or the "firing" policy.

Inquiries of the Ministry LABOUR RELATIONS



INTRODUCTION OF LEGISLATION RESPECTING LABOUR CODE

[Stage Direction]
On the orders of the day:
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question to the Minister of Labour. Is the minister aware of the fact that there are only nine calendar days left in the month of September, in fact only seven sitting days? Will he have the national labour code legislation on the order paper before the end of this month as he promised?


Allan Joseph MacEachen: Mr. Speaker, I am surprised that the hon. gentleman would even ask that question.


An hon. Member:: Why?


Stanley Howard Knowles: Mr. Speaker, is the minister not aware of the number of times we have been disappointed and put off? I think the question is one that deserves to be answered.


Allan Joseph MacEachen: The hon. gentleman has not been put off or disappointed at any time, because all statements I have made with respect to this important piece of legislation have been fully borne out by subsequent events, and I am completely confident that the statement made on my estimates will be fully borne out by the calendar date suggested by my hon. friend.


Stanley Howard Knowles: In other words, the minister could have said yes.



INDUSTRY


[Stage Direction]
On the orders of the day:
Reid Scott: Mr. Speaker, I want to direct a question to the Minister of Industry. Has the government recently held meetings with representatives of the United States to discuss the automotive parts incentive program of the Canadian government; and in view of the urgent and widespread interest in the matter did the government offer to make alterations in the program, what was the nature of the alterations, and what degree of acceptance did such alterations receive from the United States officials?


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



FINANCE


[Stage Direction]
On the orders of the day:
Mr.   Reg. Canlelon@Kindersley: Mr. Speaker, I had a question for the Prime Minister or the Minister of Mines and Technical Surveys, but in their absence I am prompted to direct it to the Minister of Trade and Commerce. Would he state whether a three year tax holiday has been granted to potash firms using solution mining methods to encourage production, as was done for shaft mining for potash? If this has not been done, I wonder why it has not been done?


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



REQUEST FOR DELAY IN FINAL SALES TAX INCREASE

[Stage Direction]
On the orders of the day:
Mr. A. D. Hales (Wellingion South):: Mr. Speaker, I should like to address a question to the Minister of Finance. In view of the fact that the cost of an average price winter built home will increase by about $600 as a result of the final 3 per cent increase in the sales tax, bringing the total tax up to 11 per cent; and having in mind also the high cost of winter building, will the minister consider delaying this increase in taxation until late spring?


Hon. Walter L. Gordon (Minister of Finance):: Mr. Speaker, first of all I cannot accept the premise on which the question was based. I can assure the hon. member, however, that the government has no thought of changing the present tax legislation to which my hon. friend has referred.


Mr. Eric A. Winkler (Grey-Bruce):: I have a question to ask the Minister of Finance supplementary to that asked by the hon. member for Wellington South concerning the winter housebuilding program and the proposed 11 per cent sales tax on building materials. Will the minister make representations to the government to ensure that the bonus paid in respect of winter built homes will be increased accordingly, so the public will not be further deceived in this regard?


Walter Lockhart Gordon: I am not worried about the public being deceived-


Some hon. Members:: Oh, oh.


Walter Lockhart Gordon: -in this regard, Mr. Speaker; I think the public is very well satisfied with the way things are going.



CANADIAN BROADCASTING CORPORATION


[Stage Direction]
On the orders of the day:
Mr. Ralph Cowan (York-Humber):: Mr. Speaker, I have a question for the Secretary of State but in his absence I will direct it to the parliamentary secretary. In C.B.C. press release No. 169 dated last Friday we are advised that on the afternoon of Saturday, October 10 the Queen of Canada will go to the Citadel for ceremonies with the Royal 22nd regiment, including dedication of a memorial chapel, and that this event will be videotape recorded for broadcast at the close of the world series baseball game that afternoon. Does the world series game take priority over the activities of the Queen of Canada because of its higher Canadian content?


Mr. J. B. Stewart (Parliamentary Secretary to Secretary of State):: Mr. Speaker, I will be pleased to bring this question to the attention of the minister.



EDUCATION


[Stage Direction]
On the orders of the day:
Walter Lockhart Gordon: I wonder, Mr. Speaker, if I might reply to a number of questions that were put to me on Thursday and Friday of last week in connection with the student loans legislation.
The hon. member for Comox-Alberni raised some questions about credit unions, and in particular I believe asked why they had not been included in some of the publicity that was arranged in connection with this program. I should explain that the main source of the detailed information on the plan which was prepared for the public is a brochure which has been given very extensive distribution. This brochure explained that some credit unions are expected to make arrangements to provide loans under this plan. It is, therefore, not correct to say that all publicity in connection with the Canadian student loans plan omitted any reference to credit unions.
A number of advertisements in newspapers and by radio across the country just prior to and following the Labour day week end were 20220-522J
Inquiries of the Ministry primarily designed to draw the attention of students to the fact that loans were available. At that time arrangements for the designation of credit unions as lenders had not been completed, and the advertisements did not specifically mention credit unions.
The letter to which the hon. member referred in his question took issue with the omission in a recent brief television interview in connection with the Canada student loans plan. In my reply to this letter I pointed out that a credit union may be designated as a bank under this act. I assured the league that I am fully cognizant of the important role played by credit unions in the field in which many of them have done pioneer work. In this connection hon. members will be interested to know that a first group of credit unions will be formally designated as banks for the purposes of the Canada Student Loans Act some time this week.
The hon. member for Saint John-Albert, I think it was on September 17, asked if I would table or make available the different quotas for each of the provinces. Hon. members may recall that on July 14, 1964 I gave the house approximate figures for the provincial allocations. The final figures for the loan year ending June 30, 1965 were sent to the provinces on August 21, 1964. They are as follows: Newfoundland, $1,176,000; Prince Edward Island, $232,000; Nova Scotia, $1,736,000; New Brunswick, $1,416,000; Quebec, $12,964,000; Ontario, $12,440,000; Manitoba, $1,968,000; Saskatchewan, $1,908,000; Alberta, $2,852,000; British Columbia, $3,236,000; Yukon, $24,000; Northwest Territories, $48,000.
The hon. member for Athabasca asked a question in respect of the allocation to students in the Ottawa area. As I explained last Thursday, whatever regional limits there may be within a province on the amount of loans available to students are set by the provinces and are outside my jurisdiction. In this connection I have been advised by the Ontario authorities as follows:
In Ontario, because a large number of institutions were named as issuing agencies, authority was given to each institution to issue certificates of eligibility up to an initial specified amount. Such a procedure was necessary in order to ensure that, in total, the 44 issuing agencies did not exceed the provincial allocation. The individual allocations were made on a proportional basis and for institutions in the Ottawa area the initial allocations totalled $830,000.
In the letter of instructions sent by the minister of university affairs to each institution it was stated:
8238	HOUSE OF
Inquiries of the Ministry
-if (your) maximum total is reached during the year you are asked to withhold issuing any additional certificates of eligibility until the availability of additional loan funds has been discussed with the department of university affairs.
No final limit has been set for any Ontario institution. If any institution in Ontario finds its initial allotment temporarily inadequate to meet demand, it should communicate with the department of university affairs as it has been directed.
The final question on this subject was asked by the hon. member for Hamilton South. He asked whether I had received representations from the Canadian union of university students requesting a supreme court ruling or a test case on the Canada Student Loans Act and, if so, what had been my reply. The answer is that I have received no such representation.


Reid Scott: In view of the minister's statement over the week end reporting very buoyant revenues to the government, I wonder when we can expect implementation of the promise of 10,000 scholarships.


Walter Lockhart Gordon: I am pleased that the hon. member should refer to the statement I made over the week end with regard to the greatly improved position of the Canadian economy. If I remember correctly I pointed out that this was due primarily to the success of the policies which were approved by this house last spring and summer.


Some hon. Members:: Hear, hear.


An hon. Member:: Devaluation.


Walter Lockhart Gordon: I would be glad to send the hon. member a copy of my speech. It will perhaps make things clear to him. In answer to the specific question raised, I will be glad to make an announcement at the proper time.


Alfred Dryden Hales: My
question relates to the announcement made by the Minister of Finance. If I heard him correctly-and the hon. gentleman will no doubt correct me if I am wrong-he said that the allotment to the province of Quebec in respect of student loans amounted to $12,500,000, while only $12,400,000 had been allotted to Ontario. In other words, Ontario will be getting $100,000 less than Quebec. On what basis were these figures arrived at, and why should there be this difference?


Walter Lockhart Gordon: The allocations, as the hon. member may recall, because they were discussed at some length during the debate on this legislation, were based on the number of students at post-secondary or high school


level. At the moment there happen to be more in Quebec than in Ontario. That is how these figures were arrived at. I should also point out to the hon. member that Quebec has decided not to come into this plan. Quebec has its own plan, so a different formula applies in that province.


Mr. F. J. Bigg (Athabasca):: On Thursday it was suggested by the minister that I was mixed up in my zeroes. I was not mixed up in my zeroes at all. I have found now, much to my satisfaction, that the ceiling in the Ottawa area is $830,000 instead of $400,000 and that, as I said, there are about 5,000 students in the Ottawa area who may wish to take advantage of loans. Already 265 applications have been turned down. I wanted to make sure these students were not left without funds, and that is the reason I asked my question.


Walter Lockhart Gordon: I apologize for my suggestion that the hon. member would ever become mixed up in his zeroes. I am sure he would not, and I apologize for anything I said in that regard. As I said a moment ago, when the allotment for students has been used up the authorities concerned should get in touch with the department of university affairs in Toronto.



DOMINION-PROVINCIAL RELATIONS CONTINUATION OP PRESENT PROVISIONS RESPECTING SHARED PROGRAMS

[Stage Direction]
On the orders of the day:
Walter Lockhart Gordon: I wonder if I might take this opportunity to deal with a question on another subject which was asked on Friday of the Prime Minister by the hon. member for Burnaby-Coquitlam. After making a reply, I think to a supplementary question, the Prime Minister said he would look into the supplementary question and reply today, or as soon as he could. It is in connection with the Prime Minister's reply on Friday to the question asked by the hon. member for Burnaby-Coauitlam concerning the government's proposal for contracting out operations in respect to cost sharing programs that I wish to elaborate.
The hon. member asked whether the several features of the contracting out option, including the tax abatement provisions and the preservation of the present undertaking in respect of such programs as hospital insurance, old age assistance, etc. were designed to apply during the interim period provided for.

The answer is yes, Mr. Speaker, as the Prime Minister has said. I would like to add only one observation. The policy with respect to shared cost programs after the interim period will undoubtedly be the subject of intensive federal-provincial deliberations during the next 18 months, including those of the tax structure committee and the federal-provincial conference.


Thomas Clement (Tommy) Douglas: Will it be government policy to bargain with the provinces to see to it that any extension of the tax abatements or transfers from the federal treasury to provincial treasuries will go hand in hand with a continuation of the reciprocity and national uniformity provisions?


Walter Lockhart Gordon: In answer to that question I would call attention to the work to be done by the tax structure committee which was set up jointly by the federal and provincial governments, as has been reported earlier. It is our earnest hope that this committee will be able to arrive at a unanimous decision, or a united decision, which will constitute its recommendations. I do not, therefore, wish to say that the federal government will take a positive decision until we have the benefit of the report or recommendations of this joint committee.



AGRICULTURE


[Stage Direction]
On the orders of the day:
Mr. Reynold Rapp (Humboldl-Melforl-
Tisdale): I have a question for the Minister of Agriculture. In his absence I should like to direct it to his parliamentary secretary. It relates to a statement the minister made that turkey and poultry prices generally are higher now than they have been for the last four years. Could the minister explain why Mr. Olaf R. Olson of Spalding, Saskatchewan, received only $8.35 for 99 chickens he sold to the Saskatchewan co-operative creamery association at Humboldt? These chickens were all graded A and B; nothing less than C. He received-
Mr. Speaker:: Order. This is undoubtedly an important matter of principle, but in my opinion the minister now understands the question and will answer in due course.


Mr. Rapp:: This is a matter of such great importance that I would like to take it up at ten o'clock tonight.
Inquiries of the Ministry


Mr. D. V. Pugh (Okanagan Boundary):: Mr. Speaker, may I ask a question of the Acting Prime Minister. When can we expect an answer from the government to the numerous requests that have been made on behalf of turkey producers throughout Canada? This matter has gone on for such a long time now that the producers are in extremely bad shape, and the government just do not seem to be doing anything about it. They lifted the quota off, and it is time we had an answer.


Paul Theodore Hellyer: I would say, Mr. Speaker, at the appropriate time.


John George Diefenbaker: Mr. Speaker, I make due allowance for the tremendous absence of ministers, but this is a problem that has to be met now. It is a serious situation. A telegram was received today by me, and I think also by the government, from the turkey producers of British Columbia to the effect that their industry is being ruined by delay on the part of this government in taking action. Surely the parliamentary secretary to the Minister of Agriculture in the absence of the minister, can give some assurance to the house in this respect.


Hon. Maurice Sauve (Minister of Forestry):: Mr. Speaker, on September 10 the Minister of Agriculture made a statement, which he confirmed last Thursday or Friday. I will read the statement, which appears on page 7826 of Hansard. This was in answer to a question asked by the hon. member for Humboldt-Melfort-Tisdale:
Mr. Speaker, turkey prices are consistent with what they have been in the last four years. As a matter of fact they are a little higher. In the last two weeks there have been no importations of turkeys from the United States, and turkey prices are fairly firm.
Then the minister said he would be discussing these problems with the producers in Winnipeg last Monday. When he came back he said he was expecting to make a further announcement with regard to this problem later on. As hon. members know, the minister is in France on official business, and will be back in the house on Wednesday.


David Vaughan Pugh: A supplementary question, Mr. Speaker. The minister, then, would not agree with the contents of this telegram, which reads as follows:
Is our government aware of the impending financial disaster awaiting the turkey industry of B.C. unless some immediate corrective measures are taken. Large scale importations of American turkeys at unrealistic prices have depressed returns to

Inquiries of the Ministry growers here to the point where even the American producers are no longer interested in shipping into Canada, an extremely discouraging situation for the Canadian producer. This association with 350 members fervently expects some action to be taken to avoid such a development which would very seriously and adversely affect-


Some hon. Members:: Order.


David Vaughan Pugh: -not only turkey producers but feed industry and others.
Does the minister agree with that, or not?


Mr. Speaker:: Order, please.


Mr. C. O. Cooper (Roselown-Biggar):: Mr. Speaker, in the statement the minister just made he said no turkeys have been imported during the last month. Is this an indication that the United States are holding off and are going to ship turkeys in for Thanksgiving and Christmas, and ruin the Canadian market for those holidays?


Mr. Speaker:: Order. The question, though interesting, I do not think is proper.



REPORT OF EASTERN CANADA FARM SURVEY

[Stage Direction]
On the orders of the day:
Mr. Marcel Lessard (Lake Si. John):: Mr. Spehker, I should like to direct a question to the Minister of Forestry. It might be of greater interest to the Minister of Agriculture but, since he is not here, perhaps it could be forwarded to him. The Quebec minister of agriculture, Mr. Courcy, stated that he was waiting for the report from the federal government on agriculture in eastern Canada before deciding on what course to take. Could the minister tell us what is the nature of the report with respect to the investigation the federal government is allegedly making about agriculture in eastern Canada and when we can expect that this report will be published?


Maurice Sauvé: Mr. Speaker, I would like to acquaint myself with Mr. Courcy's statement in order to reply to that question accurately.


J.-H.-Théogène Ricard: Mr. Speaker, I wish to direct a supplementary question to the minister.
Has he not met Mr. Courcy over the week end and has he not then discussed that question with him?


Maurice Sauvé: No, Mr. Speaker, unfortunately.
IMr. Pugh.]



CANADIAN CITIZENSHIP


[Stage Direction]
On the orders of the day:
Mr. William Dean Howe (Hamilton South):: Mr. Speaker, I would like to address a question to the Minister of Justice. Is the minister now in a position to inform the house regarding the possibility of affirmation of the oath of allegiance by prospective citizens?


Guy Favreau: No, Mr. Speaker, but I count on being able to do so very shortly.



INCLUSION OF INTERPRETERS AND TRANSLATORS IN INTERNAL ECONOMY COMMISSION DIRECTIVES

[Stage Direction]
On the orders of the day:
Mr. Guy Marcoux (Quebec-Montmorency):: Mr. Speaker, in the absence of the Secretary of State, I should like to direct a question to his parliamentary secretary.
Did the order passed by the internal economy commission and announced by Mr. Speaker last week include the employees of this house who belong to the departments of translation and interpretation? In the negative, does the minister intend to make an explanatory statement on that matter in the near future?


John B. Stewart: I take notice of this question, Mr. Speaker, and will bring it to the attention of the Secretary of State.



INCLUSION OF PROTECTIVE STAFF IN SALARY REVISION

[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: Mr. Speaker, I wish to address a question to the President of the Privy Council. Were the protective staff included in the increases awarded the staff of the House of Commons in the announcement made last Friday? If not, why not?


Hon. G. J. Mcllraiih (President of the Privy Council):: Mr. Speaker, I would point out that this is not a matter for the President of the Privy Council. This is a matter for the Speaker, and the method of communicating with the Speaker is by letter.



INDIAN AFFAIRS


[Stage Direction]
On the orders of the day:
Julia Verlyn (Judy) LaMarsh: Mr. Speaker, the other day the hon. member for Winnipeg North Centre asked me about a report that appeared in the Winnipeg press to the effect that an Indian child has been mistreated in a boarding house in Winnipeg. I have now had a chance to investigate this matter, through my officials, and should like to advise the house as follows.
I am informed that it is not correct to state that children are placed in foster homes in Winnipeg that have not been investigated. Following discharge from hospital, it is often necessary to find a boarding house for an Indian child pending arrangements for transportation and escort to his home in the north, or sometimes to continue with his medical treatment as an out patient. Some of the homes so used are licensed by the city of Winnipeg as boarding homes for children. Where these are not available, placements are supervised by departmental officials. We are informed that short term boardings are not necessarily licensed by the province or by the municipality and, as I have said, where such licensed homes are not available, placements are made and supervised by our departmental officials. These officials, because the children have just left hospital, are in almost constant daily contact with the children and their temporary homes.
In this particular instance we had previously placed children in this home. The woman in question had satisfactorily cared for five children in the last six months for periods of from two weeks up. There was no evidence of any previous mental history and no knowledge of mental instability on her part. The selection of homes which my department makes in regard to these Indian children is confined to married women with children who maintain homes and children in a satisfactory manner and have suitable accommodation for short term boarder placement. After an initial visit by a member of my departmental staff, periodic visits are made and the condition of the children during the stay and on leaving the boarding house is noted.
When the little girl in question was discharged from the children's hospital on April 2, 1964, she was taken by a member of our department to the home of Mrs. K. Wall. On
Inquiries of the Ministry April 9 the department's Winnipeg office was notified by her husband, Mr. Wall, that the infant had fallen out of the top bunk bed and had been taken to the children's hospital emergency ward by Mrs. Wall.
One of our medical officers immediately investigated and was told by hospital authorities that the child's injuries were not consistent with the story told of their having resulted from a fall. Therefore immediate action was taken to notify various authorities and to have an investigation undertaken, which resulted in referral to the attorney general's department for police investigation.
The hospital's social service department then visited the home in question to persuade this lady to voluntarily accept psychiatric help. This was done on a voluntary basis before the case came up in court. It is very deeply regretted that the baby in question has sustained what is apparently permanent mental injury, but I know of no way in which any of my officials might have known in advance that this could possibly happen, or could have avoided it.


Stanley Howard Knowles: Mr. Speaker, may I just ask the minister one question. Is she now telling the house that there is no question but that all these homes are investigated before Indian children are placed in them? This was the part of the report in the Winnipeg Free Press last Friday which seemed most disturbing.


Julia Verlyn (Judy) LaMarsh: Mr. Speaker, I am informed that this particular home was initially recommended to us by another married woman who had one of our short term boarders. An investigation was made; people went there and met Mrs. Wall, looked at her accommodation and talked to her. She has had five children, short term boarders before with never any trouble.



FISHERIES


[Stage Direction]
On the orders of the day:
Mr. R. W. Prittie (Burnaby-Richmond):: Mr. Speaker, I have a question for the Minister of Fisheries. Is he in a position to make a report to the house on the negotiations among Canada, the United States and Japan concerning the north Pacific treaty? If he is not in a position to do so, when will he be?


Hon. H. J. Robichaud (Minister of Fisheries):: Mr. Speaker, as the hon. member knows, negotiations are under way in Ottawa

Alleged Failure to Meet National Problems and have entered the third phase following meetings which took place in Washington and Tokyo last year. I am confident that the negotiations are proceeding satisfactorily and that we will be able to come to an agreement.


Lloyd Roseville Crouse: Mr. Speaker, a supplementary question. When the minister brings in his report on this agreement, could he give the house some indication of the plans which the Japanese may have for constructing facilities for use as a common market base at St. Pierre and Miquelon?


Hédard-J. Robichaud: Unfortunately, Mr. Speaker, the questions being discussed in the meetings now taking place between Canada, Japan and the United States have nothing to do with the supposed program of the Japanese to establish a base at St. Pierre and Miquelon, so I would be unable to make a report on this matter, which does not directly involve Canada. If this is the case, then this is a problem which concerns the governments of France and Japan.


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



FAILURE OF GOVERNMENT TO MEET NATIONAL PROBLEMS

John George Diefenbaker: Mr. Speaker, on these occasions the opportunity is given to members of the house to place before the country matters upon which, in the opinion of the opposition, the government has failed to discharge its responsibilities.
The motion in question is one which goes back to the earliest days. I am going to mention the purport of the motion, because frequently it is misunderstood. It is a principle of our constitution that the House of Commons shall control the finances of the country. For almost 550 years that right has been asserted in varying degrees, until within the last 200 years it has been fully confirmed and is no longer subject to dispute. In other words this motion provides the opportunity- and I quote from citation 234 of Beauchesne's fourth edition-for asserting that:
The ancient doctrine that the redress of grievances should be considered before the grant of supplies is maintained in the House of Commons of Canada.
The motion permits a wide discussion, and a discussion in the House of Commons which

is not limited by the rules. In fact the decision of Speakers throughout the years has been that members may discuss various questions on the motion for the Speaker to leave the chair, and a great latitude is allowed on these occasions.
I do not intend to speak at very great length today, Mr. Speaker. Some 17 months have gone by since the present government took office, and what has taken place in the intervening months causes one to read with interest the views expressed by the Prime Minister in his address to the nation on the day after the change of government. These words will take their place with other words uttered by those who will always regret having done so. These words, grandiloquent in their construction, provided a promise and a blueprint which in the light of experience will be either condemned or approbated. He said:
The task ahead then is immense hut it is not frightening. It is complex beyond simple description, but it is not impossible. It will not be an easy time, but it will, I pledge you, be a time to excite the daring, to test the strong and to give new promise to the timid. It will indeed be a time of direction and decision, where our efforts are sustained, our purpose clear and our faith high.
Mr. Speaker, those words as a guide to the government were great in their conception, and have been awful in their execution. I am sure even the most patient supporter of the government must laugh inwardly when he thinks of those words and the degree to which this government has failed in the implementation thereof.
Your Honour, as everyone knows there are six of these motions provided by the rules. In the month of May we passed up one opportunity to debate the motion. So far there have been three motions. On April 20 the amendment moved to the motion was that this house deplored the announced decision of the government to abandon its responsibility for the administration of veterans hospitals. The next amendment to supply motion was made on May 4 having to do with a co-ordinated national water policy, and suggesting the establishment of a national advisory committee on water resources and an acceleration of the application of ARDA policies, the expanding of water and other resource development programs conceived and established by the previous Conservative government. That motion, while defeated, in light of subsequent events has proven to have been an understatement.
The next motion was made on May 25, and the amendment was:

This house regrets the continuing failure of the government to take effective action with regard to the pressing agricultural problems of eastern Canada.
That situation is the same today as it was then, with the perambulating Minister of Agriculture being everywhere but in the House of Commons while the problem for the farmer in eastern Canada becomes worse and worse. An example today had to do with the turkey industry. When the hon. member for Okanagan Boundary referred to the situation in respect of that industry all he received was the same old push-off on the part of this government.
Those three amendments in the light of subsequent events have been shown to have been well founded, irrespective of the votes that took place in the house. Under the rules two days are provided for debate and there is still one more motion to come up, though there has been an informal agreement entered into-which is as equally as binding as if it were formal-that supply motion No. 6 will not be proceeded with because of the desire of hon. members to get on with the business of the house.
These motions give the opposition an opportunity to analyse the shortcomings, weaknesses, failures and retreats of the government in the administration of the affairs of the country. Of course the limitation on discussing those matters is that we should not be too general but should particularize. Sir, there have been so many failures on the part of this government in 17 months that any catalogue of unfilled promises could result in an amendment being moved that would be longer than any other moved in the history of parliament. Unfilled promises and uncertain and fumbling courses have made a mockery of the words of the Prime Minister in April, 1963.
Sir, we have a government that seems to have no compass, no sense of direction and no chart but that of expediency; a government whose slogan might well be tax and tax, spend and spend, retreat and retreat. That has been the history of this government, and no particulars are necessary. The evidence is apparent in every department of government. This is a government of indirection that, for some reason known only to itself, with the exception of one or two matters that have been before the house, has been so confused with legislation so ill conceived that it either has had to withdraw what it had advanced, amend what it had decided upon or repair and amend the orig-
Alleged Failure to Meet National Problems inal plans placed before parliament. It is a government that nationally has failed to bring about anything approaching national unity. It is a government that has failed to deal with the centrifugal forces that threaten the unity of Canada. It is a government that in 17 months has brought about greater divisions in this nation than had ever been seen or could possibly have been imagined since confederation. In every department it is a government that has been weak and inefficient, dawdling and uncertain, and has failed to bring before parliament legislation covering those matters that are necessary. It is a government that has increased taxation; a government that, at a time when taxation should be reduced, is taking the very opposite course.
Mention has been made today of the sales tax on production machinery and on building materials. Sir, no other nation in the western world imposes such taxes, yet this government going contrary to every economic advice it would receive from those who are experienced in the civil service of the country, brought in that tax while we in the Conservative party stood against it. It has paid off as far as revenue is concerned. I have not the latest figure, but the information I have available indicates that in January the total tax was $8.2 million, in February $7.5 million, in March $11.4 million, in April $10.3 million, and in May $13.4 million. Those are taxes imposed on progress in this country.
We took strong objection to this and continue to do so. Almost every economic and business organization in Canada has condemned this tax, but the government has refused to act. The total amount collected in 1963-64 was some $62 million. I have told the house what the figure was up to the end of May.
What has this tax done? It has simply been a clog on development. It is all very well to talk about the great expansion in building and the like, but when you deduct from expenditures 8 per cent tax that is now in effect the jubilant figures that are put forward become less optimistic in their effect. And so I could go on throughout the entire picture of development on the part of the government.
We believe the time has come for a substantial reduction in taxation. We said during our period of office that Canada was on the upgrade, that the economy was on the way up, but those gloomsters opposite said "nothing of the kind". Now they admit that 45
8244	HOUSE OF
Alleged Failure to Meet National Problems months ago the Canadian economy started to rise. Furthermore, they ridiculed us when we brought into effect the pegging oi the dollar which induced and brought about a tremendous expansion in our trade. Ridiculed when in opposition, it has now become the cornerstone ol their policy when in office.
With regard to the field of trade, the Minister of Finance, having secured a great victory in convention on Saturday-he is better in conventions than he is in parliament- dealt expansively with the economy. I should like to have heard him on the question of trade. I should like him to tell the house and the country why it is that in the field of trade our imports are increasing at a substantially greater rate than our exports. I should like him to tell us what the situation is as to the balance of payments. Certainly Canadian producers and manufacturers are having more and more difficulty competing, operating as they do with the load of the tax on production machinery. These are things upon which information should be available. These are things that optimistic statements cannot brush aside.
I mentioned a moment ago something of the situation with regard to Canadian unity. Can you imagine a government which sets up a committee for the purpose of looking into the effects of separation? I know the Prime Minister stated he really did not have that in mind, but I am going to read from Hansard of June 26 last where, as found on page 4780, he was asked whether he would con-sides- a study being made of the economic social and political effects on the rest of Canada of separation, in view of the need for clarification of this subject. The Prime Minister replied:
Yes, Mr. Speaker, we have been considering the matter. It is not a subject which lends itself to easy investigation and dogmatic conclusions, but officials of the government are making that kind of investigation now.
There can be no misunderstanding there, and the same position was repeated the other day in the house. When everything should be done to bring about unity in the nation, this government admits to a spirit of defeatism by setting up a committee of civil servants to look into the effects of separation. And so on in the whole picture.
I mentioned agriculture in eastern Canada. I could deal with the field of unemployment and how the government was going to meet that problem. All that was needed was for them to take office and unemployment would disappear. That was the undertaking. We do


not hear much about unemployment today in spite of the fact that it is at a very high level. We hear little or nothing about that. This is the party that promised much in every field of endeavour.
This cursory outline would indicate that if we were to move an amendment to cover the shortcomings of the government we would have one lengthy and filled with detail, for in every sector of government there has been failure. I look at these giants opposite and think of what they promised. I am not going into the record of the campaign promises of 1962 and 1963. I am simply mentioning one or two matters which indicate the situation. They do not know where they are going. They start, they go forward, they retreat. In almost everything they do they emulate the man on the flying trapeze. Oh, there is plenty of action. You see them moving, and then they go back. That has been the story of the present government.
We have been criticized for bringing in amendments. Many have said, why bring in amendments because you know what the result will be? The government has allies, and those allies stay with the government whenever there is a challenge in the form of an amendment. At least, they stay with it to the extent that will assure that whatever the amendment may be, however well founded it may be, it has no possibility of acceptance. That has been the story throughout the picture.
We have been criticized for moving amendments knowing they would be defeated. We know that whatever amendment we might move today, we could expect it to receive the same treatment that all amendments, however beneficial, have received in the past. In addition, we want to get on with the business of the country. We do not want to hold up the government. We have examined a great portion of the estimates during discussions on interim supply. We are most anxious that all departments of the government shall be opened so the necessary examination may be completed at the earliest possible date. All we want is to get the departments before the house, and we will deal with them effectively and I hope efficiently. We do not want to delay. We just want to help the government get these estimates before the house so that we can discharge our responsibilities.
We have had to wait for a long while since the last motion of this type. We want to have the opportunity to look into these

matters. We have no confidence in the government, but to move an amendment would, on the basis of past experience, be a continuing experiment in hope without expectation.
We therefore take this general stand. We have made clear the fact that we have no confidence. The record of the government has been one of uncertainty and worse. There are great issues. We are waiting for the pension bill; when will it come? Well, you remember that when the first one came in, Mr. Speaker, the Minister of National Health and Welfare said this is the finest thing ever. She said, "If you do not pass it, you will not have me." We did not get the opportunity, and we still have not. Then there was the second edition. There is a third edition now in drydock. Eastern agriculture has been forgotten by the government. The government has done nothing but borrow and apply cur ARDA program, then carry it out with less effectiveness than it deserves. There has been no action to assure new hope for eastern agriculture. All the way across the picture there is the same attitude. Northern development is down to a trickle.
In every field of operation we have seen this uncertainty, this failure to grapple with problems. This action of bringing in the flag was taken in order to cover up the government's failure in so many other fields of endeavour. We have seen all that. It needs no amendment to establish it; we simply state our case.
I mentioned a moment ago that there has been criticism about the moving of amendments. We have been asked, why do you move amendments? Well, it is a course that good parliamentary procedure usually dictates. We find, however, it is being interpreted as a desire to bring about an election. We do not want to be misinterpreted. It has been explained also by a certain leading front bencher that these amendments prevent the government from grappling with problems. If only the opposition were not there, what they would do. We want to give them the opportunity at once to bring in the departments that are not before the committee as yet, so they can be examined.
Before I sit down, let me repeat that the fact we have not moved an amendment does ncrt mean we have changed our attitude in any way. It simply means we are trying to bring about the effectiveness of which the Prime Minister spoke. We want parliament to come to grips with the estimates so we can get them out of the way. Having said that, I conclude.
Alleged Failure to Meet National Problems


Walter Lockhart Gordon: Mr. Speaker-


Stanley Howard Knowles: Mr. Speaker, should you not announce that if the minister speaks now he will close the debate?


Allan Joseph MacEachen: No.


Mr. Speaker:: I did not think it was necessary.


Stanley Howard Knowles: The rules require it; standing order 37(3).


Mr. Speaker:: If hon. members wish me to do so, I will announce that if the minister speaks now he will close the debate.


Walter Lockhart Gordon: Mr. Speaker, I would-


Mr. Speaker:: The hon. member for Lapointe.


Gilles Grégoire: Mr. Speaker, it is important that the business of the house be not unduly delayed, and as far as I am concerned, I shall hardly delay it for more than a few minutes. However, I feel that we cannot allow certain statements to go unanswered and that we have to establish a certain policy with regard to our concepts.
Mr. Speaker, everything the leader of the official opposition (Mr. Diefenbaker) just stated with regard to this government is valid. When he blames this government for increasing taxes, I cannot but support him. When he blames this government for its continual retreats, I cannot but support him; when he upbraids this government for the economic situation of this country at this time, I cannot but approve him; and when he criticizes this government for its indecision and continual retreat, I have to support him.
But there is another thing I want to add. When the Leader of the Opposition was head of the last government conditions were worse than those we know today, or at least as serious.
When the two old parties are in power we see perpetual tax increases; we see indecision and feel a general economic disorder. Indeed, we may well remember the economic situation in 1959, 1960 and 1961, when the present Leader of the Opposition was in office. At that time things were far from being rosy. Taxes were very high, as was the number of unemployed.
The present Leader of the Opposition, who was then prime minister, was well known for his inability to take decisions.
Mr. Speaker, when in opposition you criti-icize the government's decisions. That proves
824G	HOUSE OF
Alleged Failure to Meet National Problems one thing: when the two old line parties, Whig or Tory, Liberal or Conservative, are in opposition they claim that they can do everything and blame the government. But when they are in office they are no longer able to do anything except increase taxes, increase unemployment, show more indecision and preside over a disastrous economic situation for a country as wealthy as ours.
On many occasions in the last few weeks the Leader of the Opposition has been talking as if the third parties were the allies of the government. Now if we look up the Votes and Proceedings of the house and especially the votes taken in the course of the last 12 months, we note that the principal friends or allies of the government are not the third parties but rather the members of the Conservative party, because when there is an important vote we note that there are nearly always 30, 35, 40 and even 45 conservative members absent.
Indeed, I remember that on the occasion of an important vote, when barely 12 more votes would have upset the government, I could not keep from mentioning in this house that if the 40 Conservative members absent at that time had been present in the house the government would have been defeated.
In this case, who is the principal ally of the Liberal government?
A short time ago, I think it was in Charlottetown, the leader of the Conservative party stated that the Ralliement Credi-tiste always followed the Liberal party. Let him figure out the number of votes taken in this House of Commons since he has been in opposition, the number of times the Ralliement Creditiste voted against the government and the number of times the Conservative party voted with the government compared with the number of times the Ralliement Creditiste did. I think that he will be surprised to find that his party voted with the government more often than the Ralliement Creditiste ever did. Let the leader of the Conservative party base his information on figures and then he will stop referring to third parties who are the allies of the government and realize that, on the contrary, his own party is the first ally of the present government.
Mr. Speaker, I agree with the statements just made by the leader of the Conservative party concerning the spirit of indecision and retreat of the present government. However, when one realizes that it is the same thing when either of the two old parties is in
[Mr. GregoireJ

power, one cannot help note a very important point, and it is this: Canada needs and must choose a new government, formed with a new party and not with those two old parties we have had since confederation. They have not succeeded in giving our country an economic, political and social system that would enable this nation to develop completely and fully with all its resources and potential. Indeed, they only succeeded in administering the debt in terms of taxes, economic slump and unemployment as we have at this time.
I maintain that Canada will have to call on new ideas, a new system, a new organization of the development of our natural resources, if we really want to have a full development.
The Leader of the Opposition mentioned a while ago the existing divisions in Canada. It may be true that there is some dissension, but I feel the ones who are mostly to be blamed for that are still those who would like to continually raise the English against the French or the French against the English although there is room for both ethnic groups in this country.
The Leader of the Opposition is probably one of the persons largely responsible for the disunion now existing, not only in the country but also within his own party. He has succeeded in creating within the Conservative party an image of the same disunion now existing all across the country. You do not have to look far to find out who is responsible. You only have to look at his own chair to see one of the first persons responsible.
As far as we are concerned we declare that there is room for everybody in Canada, for all groups, and even the smaller groups who came to settle in this country. There is room for all those who want to live in peace with other citizens, without trying all the time to blame one another, but rather allowing everybody to develop fully in harmony, while partaking in the country's wealth. We believe that there is room for all by respecting the rights of all and giving freedom to all and the possibility to develop.
The Creditistes maintain that it is possible to achieve that purpose, but in order to do so it is essential that we change the main basis on which confederation stands at the present time. We want to remake the constitution and confederation according to new principles. That does not mean to tear everything down and destroy everything; that means to give a new direction to what exists now, and direct

confederation thanks to a new constitution, so that the present discord might be eliminated.
This dissension is found even within the Liberal party. A Liberal minister, in Quebec, says something and that creates dismay in the ranks of the federal Liberal party. Why? Yet, they are two Liberal groups, but they can no longer agree. It seems that the turn of mind of a Quebec Liberal changes when he is elected to parliament in Ottawa. If he is a man of real ability, as there are some in the cabinet at present-several Liberals have personal, intellectual and moral merit-it seems that as soon as he sits on the front benches, he immediately disregards his ideas and principles and thinks only in terms of the party line. On the other hand, if he has no merit, a Liberal member or any old-line party member who comes to Ottawa simply remains silent and does not bother to express any views or principles.
We see, as an example-I regret that he is not in the house at present-the hon. member for Drummond-Arthabaska (Mr. Pepin) whose opinions were quite different before he came to parliament in Ottawa. Now, he is confronted by what he previously condemned, that is Ottawa and co-operative federalism, and he is discarding what he previously preached, he is sacrificing his ideas and his principles to his party's interests.
That has happened ever since 1867 within the old political parties which have governed this country.
The Creditistes believe that these dissensions could be terminated and that peace could be restored. That would not be difficult to achieve as long as confederation could be reestablished on a new basis.
The essential basis-this has been said often, but I want to repeat it, in the hope that the present government, which realizes more and more that the present situation is getting tense and the atmosphere heavier all the time, and parliament will try to do something before it is too late-is to recognize not only in parliament and in speeches, but also in practice, that our country is made up of two different nations which can live together, not necessarily apart but in close association, to make Canada one of the greatest and most prosperous countries. Two associated states each having its own responsibilities, and reaching an agreement on a number of others. Two associated states are not separate states, on the contrary, they cooperate instead of being divided.
Alleged Failure to Meet National Problems
We are advocating the principle of two associate states and this is the present tendency. If parliament-I do not mean the government but parliament-if all members of the house agreed to draw up a new constitution: two associate states in certain common fields which would keep their responsibilities in certain others.
We are now witnessing on the contrary, the continuous intrusion of the federal government in provincial fields, when the federal government should feel duty bound to respect the rights, obligations and responsibilities of provincial governments. Two associate states which would work together in certain fields, but which would leave to the provinces a certain number of other fields.
We have drawn the list of 16 different fields including defence, external affairs, atomic energy, an agency which now exists, and also transport and postal service. In short, there are 16 different fields where two associate states could co-operate through a really non-federal government and not a government trying to control both states within confederation. This can be done.
Then, the association of two states would develop peacefully and would enable both states to develop more extensively. I have seen citizens from other provinces, even important men in the political field, who desired more and more centralization, a central government, whereas Quebec province and the people wished exactly the opposite. By adopting the principle of two associate states, there would be decentralization for those who want it and centralization for the others. Both states could develop more fully than they are now doing.
Mr. Speaker, we will have to come to such an association some day, for confederation, as it exists now, cannot continue to make progress, because there are only compromises, half solutions, false solutions, solutions that do not settle anything.
Mr. Speaker, the Leader of the Opposition spoke a moment ago of the country's disunion. Well, petty politics will not solve that problem. On the contrary, we can only hope to solve it by putting forward sound solutions likely to be accepted by everybody and carried out across the country in a practical and realistic way. It is our intention today, since that problem was raised a moment ago, to make a practical and realistic suggestion in this regard, and that is to revise the constitution and set it on a new basis, a basis which would not make the central government an associate state but a government depending
8248	HOUSE OF
Alleged Failure to Meet National Problems on and helping in the development of both states.
Mr. Speaker, had we known that the Leader of the Opposition had no intention of moving an amendment, which is not usually the case, we ourselves would have moved a motion suggesting precisely a revision of the constitution setting it on a new basis, on new principles in short, a new constitution under which the country would develop not in the midst of disunion but in harmony and peace. Unfortunately, we did not have time to put down our amendment in writing, but if the debate lasts until six o'clock we will be able to submit it to the house and in such a way as to leave no doubt in the minds of the general public. It will not be in the form of a confidence motion, but a motion for putting the country under a new system, a system under which everybody will be able to live in harmony.
Mr. Speaker, we will present such a motion if the debate is resumed after six o'clock. In any case, we will say this: the blame put on this government applies to all governments which have been in office since confederation.
This is due to the monetary and economic system at present prevailing in this country, a system under which we witness, in a period of prosperity, people on the verge of starvation while warehouses are bulging with products. While there is so much development required in this country, men are out of work. There are masons, bricklayers, carpenters, plasterers without work, whereas in the universities of Quebec and Montreal-the situation is the same in the province of Ontario- admission is being refused to medical students, under the pretence that there is not enough space.
The fathers of those young men would be able to build the necessary quarters, but they are unemployed; during that time, they are refused the privilege of working on the construction of universities, while their sons themselves are refused admission in some faculties.
On the one hand, the family head cannot work on the construction of those quarters and on the other, the son is being refused admittance to the university. This is another scandal of our modern times. Such a situation exists under the present government, such a situation existed under the previous government. I have mentioned medical faculties, but the same thing occurs in all faculties.
There is talk of developing our educational system in this country, and it is alleged that we have not got enough funds; necessary


credit is lacking to allow the authorities to expand their quarters, to increase the number of professors, and all those who would like to be educated are left aside.
What is the point of speaking of education if a young man studies six years in primary grades and eight years in the humanities, if after 15 years of study, he finds the doors of the universities closed because there is no more room and not enough professors? Why make long speeches on free education, without any school taxes, while at the same time, rejecting our young people who want to register at a university? This is due to our capitalistic system, to our monetary system. Those are the things which this government and the previous governments defend with all their might. Our economic system refuses to give work to the unemployed in useful and even necessary projects for this country. Such is the system which we, the Social Credit, have been fighting for years.
At the same time, a certain phenomenon can be observed. We see with surprise that the government of the province of Quebec just borrowed $100 million from another province. Now, why is the government of Quebec getting deeper and deeper into debt, whereas the government of another province has money to lend? While the province of Quebec will be paying $57 million in interest a year, the government of British Columbia has money to lend and will grow richer on the interests paid each year by Quebec.
Yet I remember that the Liberal party, during the 1963 election, had a young student from British Columbia come to the province of Quebec, had him hold meetings, make speeches, television appearances, during which he said that Social Credit meant imminent chaos and depression. Yet, the student was from British Columbia. He said: I am from British Columbia, and my province is in a bad depression, getting deeper and deeper into debt, and on the threshold of bankruptcy. Less than a year and a half later, we see the British Columbia government lend $100 million to the province of Quebec. That government is therefore hardly reduced to bankruptcy. It was the Liberal party which sent us this young pup to tell us that British Columbia was getting into debt. It must have recovered very fast since it can now afford to lend $100 million to the province of Quebec.
I remember the time that the Liberal Minister without Portfolio (Mr. Dupuis)-it is a good thing he has no portfolio because he would not know how to handle it-went

around saying that our party was advocating funny money while he was throwing dollar bills in the air. If that was funny money, I know a Liberal government in Quebec which was happy to borrow $100 million of it. If that was funny money, the Minister of Finance who had to borrow himself would surely be glad to borrow from British Columbia or from Alberta which loaned to other provinces-I believe it was to Saskatchewan when the hon. member for Burnaby-Coquitlam (Mr. Douglas) was premier.
How is it that those two provinces are in a position to lend money for the development of the other provinces?
And the federal Minister of Finance may find that funny. He borrows the year round and now he has to pay $1,080 million in interest on his debt each year. There is one who has $1 billion to lend, while the other has to pay $1 billion in interest each year. But, of the two, which is the funny system?
Mr. Speaker, is it the Social Credit system, the present Liberal system or the previous Conservative system?
Quebec's premier, for his part, states: "This proves that credit is good". Of course credit is good, since it is the credit of the province of Quebec. He borrows on our houses, on Quebec's industries.
But why is credit good? Because he has raised taxes to be able to pay the interest on his debt. As a matter of fact, the more you raise taxes in a country, the better the credit becomes. That is how credit is appraised. This means that the citizens of a province or of a country are made poorer.
If credit is to be good, you must increase taxes in order to be able to reimburse two or three times the amounts borrowed, because you must reimburse the interest and the capital under the present system.
Our present economic system results in unemployment, taxes and debts.
It seems to me that when governments do a little better than the others, we should at least take their advice and study what is happening, how those governments administer their business, instead of continuing to administer ours like the federal government and the Quebec government are doing now.
The Quebec government is increasing taxes for education purposes; the municipalities are also increasing property taxes on houses to help school boards. However, there is not even room enough for our youth in the universities. We heard talk about free education, but when students want to enrol for
Alleged Failure to Meet National Problems university courses they come up against the lack of funds to build new universities.
For the past five years, the Ralliement Creditistes has been after provincial authorities to spend more money for the building of schools, colleges and universities.
Today we are faced with the cold facts. Hundreds of students, after 15 years of schooling, cannot enter university to continue their studies in the profession of their choice because there is not enough room.
Meanwhile, the unemployment situation is getting worse. The Minister of Labour (Mr. MacEachen) may deny it, but the number of unemployed is not going down in Canada. His figures may indicate that the situation is improving but they are a sham. When the minister states that there are 125,000 people who are out of work in this country, he bases his calculations on the number of people who get unemployment insurance benefits. However, there are just as many people, if not more, who are not entitled to such benefits, who must be satisfied with social assistance which is so small that it barely keeps the recipient from starving until he gets his next cheque a fortnight later.
The Minister of Labour-I was going to say the minister of unemployment which would have been just as good a designation-claims that unemployment is going down, but it is high time that the Canadian people insist on getting true figures because there are other people besides unemployment insurance recipients who are out of work. There are others who do not get unemployment insurance benefits and this poses a problem, because they have to eke out a living on social assistance with the result that the number of unemployed is just as high as ever but the figures have been juggled. Hypocritical statistics are being used so that the real seriousness of the unemployment problem is unknown. The government uses incomplete statistics to say that there is no unemployment although it is more acute than ever.
They keep saying that the economic situation is prosperous, but if you take a look at the number of bankruptcies in the last six months, you note that there are more than ever. That is what is called economic prosperity in this country although the number of bankruptcies is going up.
The Minister of Finance stated that it was because of the 11 per cent sales tax on building materials that there were so many new constructions, especially in Montreal. There may be more activity in the building field in Montreal, but practically all buildings are
8250	HOUSE OF
Alleged Failure to Meet National Problems public or government buildings, because construction in the private field or in the field of family housing has gone down compared to previous years. The increase has been in the construction carried out by various levels of government. And to do this, they have to borrow, pay interests and burden the people with new taxes.
That is what is called a boom in the construction business under the present administration. There is no increase in construction in the private sector or in the field of family housing, but merely and especially in the construction of public buildings.
Mr. Speaker, going over all the faults and shortcomings of the present regime, one finds cause for concern. Besides, I know people are aware of the fact, because they are faced with some lasting problems. Maybe the government does not realize it, but people surely do. They are not living in an ivory tower, like the Minister of Finance or the cabinet. People look at what is going on around them, and I suggest the cabinet and especially the Minister of Finance do the same. Indeed, they should remember that, after his defeat, the former prime minister, Mr. St. Laurent said: "We got too far away from the people." When the Minister of Finance states that this 11 per cent tax on building materials spurred construction, I feel he is getting quite a bit out of touch with the people, and it is distances such as this which cause governments to be overthrown from one day to the next and which make them open their eyes when it is too late.
Mr. Speaker, the Ralliement Creditiste has an answer to the present economic problems. It is to make available the necessary funds in order to enable the country to develop fully, to make available to the people sufficient funds and capital to promote trade and industry within the country, because in a tremendously rich country such as ours, it is quite abnormal to see poor people living on unemployment insurance benefits, in short, people unable to enjoy all the wealth the country is in a position to produce.


Thomas Clement (Tommy) Douglas: Mr. Speaker, a few moments ago I was quite prepared to have the Minister of Finance (Mr. Gordon) close the debate, and I still am. However in view of the fact that the hon. member for Lapointe (Mr. Gregoire) has made a statement I thought I should say a few words in order to clarify the position of this party.


The right hon. Leader of the Opposition (Mr. Diefenbaker) has not moved an amendment, and therefore there is nothing before the house except the general motion to go into supply. I feel the same way as the Leader of the Opposition, that while there are a great many questions we would like to discuss, probably the most effective way in which we can further the business of this country is to proceed at once to pass this motion. There are many grievances which the members of this party would like to raise, but all of them can be raised on the departmental estimates which we will be discussing during the next few weeks. There are also many legislative items in which we are interested. But we feel the best way to promote the business of the house is by passing this motion.
We are extremely anxious that the government bring down the Canada pension plan at an early date; we regret that the government has been so slow in getting it on the order paper. We are equally concerned about a national labour code and we hope that the minister's assurance this afternoon that it will be brought down before the end of the month will be carried out. We are anxious to see the redistribution legislation passed, because it is a long time since the representation of this house was based on a recent census. We are anxious that the railway legislation be examined very carefully, not only in the house but in a committee of the house, because it has far reaching repercussions for the Canadian people. There are many other pieces of legislation which we should like to discuss and we think the sooner we get at them the better.
There are also many questions not on the order paper that one might discuss. For example there is the question of unemployment, particularly the problems of structural unemployment, because it is becoming increasingly apparent that a mere economic boom is not going to solve the problem of structural unemployment. This is going to depend on a much vaster retraining, training and placement program than anything the government has envisaged so far. We are anxious to see the government bring down some specific measures to begin laying the foundation for the implementation of the Hall commission report on health services. We are also anxious to see the government carry out its commitment for 10,000 scholarships. These are items which we can raise at a later time.
We have been sitting since February. Even if the house continues to sit steadily from now till nearly Christmas there are only about

60 sitting days left. We think with the estimates which still have to be discussed, with the legislative program before us, and with the items that the government has promised to put on the order paper there is more than sufficient work to keep this house busily engaged until almost the end of the calendar year. For that reason we do not think that the interests of the country would best be served by a protracted debate at this time on some general topic.
The Leader of the Opposition said something about the government having allies who always support it no matter what comes up. I just want to say that an examination of the records of this and last session will show that we have probably voted against the government as often as we have voted for it. We do not consider it our function to vote either for or against the government and we have made our position clear with respect to both the old line parties when they were in office. We differ from them on many fundamental issues, but we do think our job here is to co-operate with whatever government is in office, including this one, as we did with the previous government, in an attempt to get legislation passed and in trying to improve the lot of the Canadian people. The best way to do that under the present circumstances is to pass this motion as quickly as possible.


Mr. R. N. Thompson (Red Deer):: Mr. Speaker, it was not my intention to prolong the business that is before the house at the present time because basically we are in agreement with the Leader of the Opposition (Mr. Diefenbaker), as indicated in his remarks, as far as permitting the work of the house to move forward as rapidly as possible is concerned. However in view of the fact the hon. member for Lapointe (Mr. Gregoire) found it necessary to use this opportunity for a general discussion, it is necessary to make at least a few remarks at this time.
It is the objective and the purpose of our party to get on with the work that is on the order paper, and to permit the government to bring in that legislation it has assured us is going to be dealt with at this session. Certainly there is a great deal of very vital work for us to do. We have heard a great deal of criticism of the government, and we share the opinion that it is essential that various departmental estimates be brought before the house so that they can be considered and passed as soon as possible. There has been some progress made in this regard in the past few weeks, yet there are estimates of at least seven or eight major departments yet to be
Alleged Failure to Meet National Problems considered. When these estimates are brought forward for consideration we have an ideal opportunity for specific debate essential in respect of the government's program. I refer briefly to such departmental estimates as those of the Department of Justice, the Department of National Revenue, the Department of Finance and the Department of Trade and Commerce, as well as the estimates of the privy council, the Department of Veterans Affairs and others. At this time there is a necessity to deal with them as quickly as possible.
I would remind the house of the legislation presently on the order paper which must be considered as soon as possible, and the sooner the better, because already there have been long delays. First of all I am thinking of legislation dealing with publications, which has been on the order paper now for a number of months. A number of major statements have been made by the right hon. Prime Minister (Mr. Pearson), yet we have not had an opportunity of dealing with this legislation. We must also deal with legislation relating to redistribution. If we are not careful this legislation will be delayed until another session and another year, and soon the statistics resulting from the 1961 census will be as out of date as those available before that census was taken. It is essential that we establish the necessary machinery for dealing with redistribution as quickly as possible.
We must also deal with railway legislation. Certainly many years have passed since the report of the royal commission was published. The drafted legislation has been referred to the committee, and this committee should get to work quickly so that a report can be made to the house at an early date. We must also deal with the Canada pension plan, to which reference was made this afternoon. The government has failed to carry through its suggested draft legislation, and while I do not regard this legislation in the same light as some members of this house, that it must be passed immediately, I agree that because of its importance we must proceed carefully and get started on it very soon.
Mr. Speaker, I do not think it is necessary for me to review the other legislation now on the order paper, or mention again that legislation which has been promised, but I do believe at this present time that we should reassure the people of Canada that our basic objective is to deal with the essential business before us with dispatch and in an efficient manner. Therefore I agree with the suggestion at this time that we forgo a lengthy

Alleged Failure to Meet National Problems debate relating to a general discussion on the motion before us, and give the Minister of Finance an opportunity to reply. I hope he will show his own co-operation and willingness to go along with the position now stated by keeping his remarks down to bare essentials. I join with the Leader of the Opposition and the leader of the New Democratic party in the suggestion that we permit this house to get on with its business by limiting this debate to the remarks we have now made.


Mr. Speaker:: If the hon. minister speaks now he will close the debate.


Walter Lockhart Gordon: Mr. Speaker, perhaps I may be permitted to begin by thanking the Leader of the Opposition (Mr. Diefenbaker) for his congratulations in respect of that great convention held in Toronto on Saturday at which there were some wonderful candidates, over 1,400 delegates, and many hundreds of alternate delegates and friends in attendance. They really represented the people of Ontario, and in their wisdom chose a fine young man who will be a credit to the public life in Canada.
I should like to reciprocate by congratulating the Leader of the Opposition on the record that he has set this afternoon. There were those who did not think that the right hon. gentleman could make a short speech, and believe me we are delighted to be surprised.


Thomas Clement (Tommy) Douglas: Show your pleasure by emulating him.


Walter Lockhart Gordon: Mr. Speaker, I have received some advice-which I am sure was well meant-from the leaders of some parties who have been known to speak a good deal more frequently than I have in this house. I remind my friend, the hon. member for Burnaby-Coquitlam (Mr. Douglas), of my claim to the record of having made the shortest speech in parliament since confederation. I was clocked at 48 seconds the other day.


John George Diefenbaker: What date was that speech?


Walter Lockhart Gordon: I should like to make one other reference to a specific comment of the Leader of the Opposition and I wrote down his words because I found them so encouraging. He said: "We want to get on with the business of the country". Believe me, there are many of us who agree with him in that regard. I do not mind saying that some of us have felt somewhat frustrated in recent months, and

some of us on this side have wondered whether the right hon. gentleman and other members in this house were really anxious to get on with the business of the country.


Marcel Joseph Aimé Lambert: Just as anxious as you are.


Walter Lockhart Gordon: So far on various estimates we have spent 52 days, of which 14 days were on the final supplementaries of 1963-64 and 19 days were on interim supply. I suggest to Your Honour that must be something of a record.


John George Diefenbaker: No, 25 or 26 days under the previous government.


Walter Lockhart Gordon: I did not interrupt the right hon. gentleman during the course of his remarks but I intend to reply to some of the things he said. We spent 8 days on the student loans bill, 7 days on the fiscal revision bill, 22 days so far on the flag, 12 days on the Columbia river treaty and 11 days on the redistribution bill so far. If that does not represent a concerted policy of filibuster or at least a slowdown I should like to know what does.


Stanley Howard Knowles: Tell us also about the 60 days of decision.


Herbert Wilfred Herridge: Who was the cause of it all?


Mr. Woolliams:: That is the question; who caused it?


Herbert Wilfred Herridge: Who started it?


Walter Lockhart Gordon: The Leader of the Opposition criticized the Prime Minister for his efforts to unify the country. I found it surprising that the Leader of the Opposition of all people would criticize any other man on that score. I have been wanting to point out for some time, Mr. Speaker, and I am going to take this opportunity to do so if I may, that many of the members on this side of the house, including myself, are very new at politics and that a great many of us stood for parliament for two reasons and two reasons only. First we were disgusted with the way the affairs of the nation were being managed. I am sure I speak for a majority of the members on this side of the house when I say that most of us had no wish to enter public life, but this was one of the main reasons we stood for election.


Eldon Mattison Woolliams: How do you feel about it now, after your budget?


Walter Lockhart Gordon: I feel fine, and if the hon. member will wait a little while I will give him the reasons. With respect to our second

reason for standing for parliament, I know that while not everybody will agree with me a great number of people will agree on this point. I say very seriously that we stood for parliament because we thought and believed then, and we know now, that the Prime Minister is the greatest Canadian of his generation. Those of us who have travelled around the world know that there are many people in high places, in senior positions in the governments of other countries who think that the Prime Minister is one of the greatest men in public life today anywhere in the world, and we believe this. I think that most members on this side of the house will agree with me. I am sure there will also be some on the other side of the house who will agree with me, though perhaps not the hon. member for Port Arthur (Mr. Fisher), when I say that we deplore the practice that has developed of trying to tear down and discredit the present Prime Minister of Canada.


John George Diefenbaker: Well, well, well. What were you doing all the time in opposition and before you came here?


Lloyd Roseville Crouse: Will the minister permit a question?


Walter Lockhart Gordon: I will permit a question at the end of my remarks.


Lloyd Roseville Crouse: Do you remember this
"Diefenbuck" your party printed to ridicule the former prime minister?


Walter Lockhart Gordon: Mr. Speaker, I have wanted the opportunity for a long time to say what I and a lot of other Canadians think about the Prime Minister.


Eric Alfred Winkler: Such nonsense.


Walter Lockhart Gordon: We believe it, and when we say it we speak with considerable emotion. As anybody who is fair, honest and objective knows, the Prime Minister believes, as most of us surely do, that the most important job to be done in this country is to hold it together, to unify and to unite it and, believe me, we think he is doing a fine job in that direction.


Some hon. Members:: Hear, hear.


Eric Alfred Winkler: Pretty weak applause.


Walter Lockhart Gordon: I am going to speak for a few minutes if I may on something I know something about.


An hon. Member:: That will be a change.


Walter Lockhart Gordon: You will see-


Eldon Mattison Woolliams: What did you say?
Alleged Failure to Meet National Problems


Walter Lockhart Gordon: The interjection came from your friend behind you. I should like to talk for a little while about the economic progress that has been made and about the position of the country at the present time. I do so because of the remarks of the Leader of the Opposition. In what I thought was a rather scattergun approach he took rather casual and certainly not too well documented potshots at a number of policies which the government has introduced and which have worked out so successfully. I would remind hon. members that when the present government took office a little less than a year and a half ago the upturn in the current business cycle had been in progress, in a faltering way it is true, for about two years, and some hesitations in this progress could be detected. It was apparent that the forward pace would not be fast enough to provide jobs for those who would be entering the labour force in the period ahead. Accordingly, in the spring and early summer of last year a number of new policies were introduced and, if I recall correctly, somewhat bitterly attacked, which were designed to stimulate and expand the economy and provide more jobs. I should like to remind hon. members of a few of these policies because they have certainly worked well.
First of all, there were the very substantial incentives in the form of generous capital cost allowances to manufacturing or processing companies owned by Canadians, or with a degree of Canadian ownership, which purchased new machinery and equipment in the two years following the budget of June, 1963. Believe me, those incentives have had a remarkable effect. Second, there were similar incentives, together with a three year tax exemption, for manufacturing and processing enterprises establishing new facilities in areas of slow growth and high unemployment. These incentives have also been remarkably successful.
Then there were the incentives to the automobile industry aimed at securing for Canada a fairer share of the total production of North America. As most hon. members know, this has provided a stimulus to the manufacturing industries of this country which, except perhaps during the last war, they have never had to the same degree. There was the municipal development and loan fund which was designed to encourage municipalities to accelerate their capital spending programs. This also has been working out remarkably well.
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John George Diefenbaker: What is the amount of loans under that?


Walter Lockhart Gordon: I will be glad to make that figure available to the right hon. gentleman. I do not have it in my head but it is very substantial. Then there was the Atlantic development fund of $100 million which was intended to and is stimulating the economy in the Atlantic area of Canada.


John George Diefenbaker: How much has been appropriated there?


Walter Lockhart Gordon: I shall be glad to get that figure and put it on the record.
There was an improvement in the terms and a shortening up of the incentive program for municipal winter works. There was the $500 bonus plan for winter built houses, which I recall was laughed at at the time it was first announced but which has been tremendously successful in alleviating winter unemployment.


John George Diefenbaker: Will the minister allow a question?


Walter Lockhart Gordon: I think if you don't mind, you might ask questions later.


John George Diefenbaker: I should like to ask the minister if he read the observation of the hon. member for York East (Mr. Otto), who said it was a complete farce.


Mr. Roxburgh:: Who is the member for York East?


Walter Lockhart Gordon: I thought that what I was trying to do was to explain to some hon. members what had happened. I feel an interjection of that kind is really not to be taken too seriously.


John George Diefenbaker: He is an authority. He knows the business. He is in it.


Walter Lockhart Gordon: The winter house building program was supplemented and assisted by an increase in mortgage loans by Central Mortgage and Housing Corporation of somewhere about $130 million, that is over the same amount in 1962. It was hoped when these loans were introduced that, together with an expansionary monetary policy, they would provide the kind of stimulus that was needed to get the economy surging forward. This is exactly what has happened. When I say that, I am going to show later, Mr. Speaker, that not only has the Canadian economy surged forward in the last year but it has outpaced the progress made in the United States to a significant degree.


It is quite true and everyone will admit, in fact they will be pleased to point out, that these improvements in the Canadian economic scene were aided by large sales of wheat to Russia and other communist countries. Mainly however the improvement in the economy was due to the success of the policies I have mentioned.
There is another point I should like to make. The growth in the economy has been well balanced and no excesses are apparent which might cause serious stresses or pressures. It is now clear that total production for the calendar year, that is the current calendar year, will be appreciably higher than was forecast at the beginning of the year.


Eldon Mattison Woolliams: What is the percentage?


Walter Lockhart Gordon: If my hon. friend will contain himself, I shall be glad to put on the record those figures. In the first quarter of this year the gross national product, excluding agriculture, rose by 4.2 per cent over the last quarter of 1963. Compared with the first quarter of 1963, the increase was 9.6 per cent. Now preliminary estimates indicate, as we expected, that while the gross national product made a further gain in the second quarter the increase was not as much as in the first three months. The increase could not possibly have been. Our guess is that third quarter growth will be moderate, and in the fourth quarter the pace of activity is expected to rise again.
I say this because there are many powerful forces at work which should keep economic activity at a high level in the months ahead. These include the capital spending programs of both industry and government and, for this winter, the renewal of the house building bonus plan which the Minister of Labour (Mr. MacEachen) has announced. If last winter's pattern is repeated this means higher income and higher consumer spending as a result. It is probable also that exports, apart from wheat, will continue in the fourth quarter at higher levels than they were the year before. Of course, as any hon. member from western Canada will appreciate, if western farmers are blessed with good weather and are able to harvest their crop, it looks like a better than average crop and this of course will add to the strength of the economy in the months ahead.
I said the other day, and I should like to try to repeat this in the house, that these various trends, these various indications and

the support we see underlying the present economy should mean that the gross national product this year may be of the order of 8 per cent-it may be even a little higher than 8 per cent-over the previous year. In real terms we expect that the increase over last year will be in excess of 6 per cent. If this is achieved, Mr. Speaker, I suggest it is something in which all members of this house and all Canadians can take pride.


Eric Alfred Winkler: Would this be attributable to the pegging of the dollar?


Mr. Fisher:: Or the budget of 1963?


Walter Lockhart Gordon: If these questions are serious,
[DOT]-and the hon. member for Port Arthur (Mr. Fisher) should be serious, because after all he speaks to a larger audience than I am talking to today. He must know that in my personal opinion the dollar would have been revalued long before it was. The fact that it was revalued, even though the revaluation came at a most difficult time and was accomplished in a most inopportune fashion-obviously, it was what was needed. It had been, in my opinion, needed for the previous two years. The effect of this revaluation was clearly beginning to taper off, however, by the spring and summer of 1963. This was one of the reasons there was a faltering in the upturn of the economy. This was the reason other policies were needed. Those policies, I should like to remind my hon. friend from Port Arthur were the policies that were introduced by this government during the spring and summer of 1963, and those policies have been remarkably successful despite the fact that some pundits may not have thought they would be successful.


Eldon Mattison Woolliams: Why did the Prime Minister then say there was going to be economic ruin when we pegged the dollar? This is the man you said was a great Canadian.


Walter Lockhart Gordon: I do not believe I should be called upon to reply to the hon. member who is making speeches from his seat. I think we should be welcoming him back to his seat. If he waits until I have finished, I shall be glad to answer any questions.


Malcolm MacInnis: I rise on a question of privilege, Mr. Speaker. I think the minister is casting insinuations upon my hon. friend here without realizing that accompanying my hon. friend was a member of his own party. The insinuations he is trying to cast may reflect back on his own party.
Alleged Failure to Meet National Problems


Walter Lockhart Gordon: I was not intending to cast reflections on anybody, and certainly not the hon. gentleman who was speaking from his seat.


Mr. Mandziuk:: That's right; back track again.


Walter Lockhart Gordon: I cannot deal with a comment of that kind.
I was about to say, that I do not expect that on the economic front we shall have to face any obvious dangers in the months ahead. I see no reason why the present trend of economic activity should not continue into 1965. There is no evidence to suggest, for example, that we are heading for the kind of speculative boom which would bring about inflation and, if the inflation was serious enough, would be followed by collapse. Nor are there any immediate warning signs on the horizon of a slow down. I am pleased to be able to say this because when we hear all kinds of speculative statements being made by various people in private life -I think this is a good thing, myself; I welcome a greater degree of public discussion and public statements by authoritative people on the economy and the kind of policies which should be adopted-I think that it is wise for a spokesman for the government to state periodically that in his opinion, and with the resources of the government behind him, he does not see any immediate difficulties on the horizon.
I would not want anybody to think I am suggesting that things will always be as satisfactory as they seem to be at the present time. That would be contrary to all past experience. No one would expect me to say it, or believe me if I did. But I can assure all hon. members that if indications should become evident of either serious inflationary pressures or of a turndown in the rate of economic growth the government would not hesitate to take the kind of remedial action which may be called for, just as it did, if I may say so, in the spring of 1963.


Malcolm MacInnis: Would the minister permit me to ask him a question? Does the hon. gentleman mean by his remarks that the government now intends to bring the Canadian dollar back to par?


Walter Lockhart Gordon: No, Mr. Speaker.


Some hon. Members:: Hear, hear.


Walter Lockhart Gordon: I have made it clear where the government stands on this matter. I have gone out of my way to be emphatic on it on other occasions.
8256	HOUSE OF
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Lloyd Roseville Crouse: Why did you ridicule us when we did it?


Mitchell William Sharp: You did it so badly.


Some hon. Members:: Oh, oh.


Malcolm MacInnis: Would the minister permit another question?


Walter Lockhart Gordon: I am quite prepared to accept one other question and then I think I should be permitted to go on with my remarks.


Malcolm MacInnis: The minister says he has made his stand clear with regard to the position of the Canadian dollar, and he is probably in agreement with what his colleague the Minister of Trade and Commerce had to say a few days ago on this subject. Why, then, did he deceive the people of Canada when he said at Cobourg, Ontario on March 29, 1963: "I believe I was the first person to state publicly that devaluation caused the stagnation of the economy"?


Walter Lockhart Gordon: I can say categorically that I never made a statement of that kind. I would remind the hon. member that I am not likely to have made a statement of that kind in those terms, since I was advocating the course to which he refers two years earlier.


John George Diefenbaker: You were not able to convince your friends.


Walter Lockhart Gordon: As I was saying, the economy has shown a very marked improvement and we should all rejoice that this is so. I am not satisfied with the conditions in the Atlantic area or in the eastern part of Quebec where unemployment is too high and income levels are too low. But I am encouraged by the fact that unemployment in those areas has been reduced appreciably, just as it has in all other parts of Canada. Taking the country as a whole, conditions are most encouraging and, as I said the other day outside the house, one of the by-products should be a considerable reduction in the federal deficit for the current fiscal year as compared with the forecast which was made six months ago.
We all appreciate, I presume, that one of the most notable developments within the economy this year has been the increase in capital spending plans of private industry. A survey taken late last year showed that capital outlays in 1964 in both the public and the private sectors of the economy were expected to rise by 8 per cent. I think it is fair to say that the full implications of the incentives offered industry in the form of


increased capital tax allowances had not been fully appreciated at the time this survey was made. The fact is that increased capital spending has been running at a much higher rate than 8 per cent. According to a midyear survey it is expected to reach a 16 per cent increase this year over last year, the greatest increase in any year since 1956.


Some hon. Members:: Hear, hear.


Walter Lockhart Gordon: Somebody, perhaps it was the Leader of the Opposition, mentioned housing. As I believe I said in answer to a question last week, housing starts in the first six months of this year in centres of 5,000 population and over were 12 per cent higher than in the first half of 1963. Completions in the same period were 43.8 per cent above the number of completions during the same period a year ago, and units in various stages of construction at the end of June of this year were up by 7.1 per cent compared with the year before. So I say to hon. members that despite all the talk we heard last year- and we still hear the odd, plaintive echo of it now-these various forecasts and statistics show that the withdrawal of the sales tax exemption on construction materials has not inhibited the expansion of the economy.


John George Diefenbaker: That is not what the Canadian lumbermen's association says with regard to the construction industry.


Walter Lockhart Gordon: 
John George Diefenbaker: How many months has it gone down in the last year?


Walter Lockhart Gordon: If my hon. friend will just bear with me for a moment, Mr. Speaker, I was about to say that I think the changes over a longer period than a month are the only ways to look at these fluctuations intelligently, unless one is in possession of the moderating factors that are needed to reduce a month's change to a seasonally adjusted basis. So the figure that I would like to put before the house is the change in the increase in the consumer price index in August of this year as compared with August, 1963. The increase during those 12 months was 1.6 per cent; and this is a record. It is, in fact, a good record, which has been unmatched by any of the major industrial countries of the world, with the exception of the United States.
I think sometimes when we talk about the consumer price index we tend to overlook a factor which perhaps, if we want to be objective, we should take into account more often; that is, that the index is not a precise guide to changes in real living standards. It is difficult, for example, to adjust the index for changes in quality of the products whose price it measures. As there has been a fair amount of talk about new houses, I would point out that while they cost more today than in 1959, they incorporate today many features of greater value, even down to the greater durability of the paint. I think it is fair to say that today's automobile tires perform better than they used to; that clothing fabrics are more durable. I could go on and give other examples; but these are the kinds of improvements that are not, and cannot be, reflected easily in the price index.
The fact is that despite statistical price indexes Canadians today have higher living standards than they have had at any time in the past; the personal disposable income available to the average Canadian to spend on what he needs or what he wants-and I for one believe that he should have the choice- has risen a good deal faster than the relatively slow advance of the consumer price index. Mr. Speaker, I would now like to turn to another matter.

Alleged Failure to Meet National Problems


Mr. Speaker:: X am sorry to interrupt the Minister of Finance but his time has expired. He started at 4.40 and his time would run to 5.20; and I believe it is now 5.20.


Some hon. Members:: Carry on.


Mr. Speaker:: Does the house agree to extend further time to the Minister of Finance?


Some hon. Members:: Agreed.


Douglas Mason Fisher: If the minister is willing to answer some questions at the end of his speech.


Walter Lockhart Gordon: If that is the condition, Mr. Speaker, I gratefully accept it. I appreciate very much the generosity of the house in allowing me to continue, because I did want to put on record some comparisons of the relative increases in economic progress, in the United States and Canada.


Mr. Kindt:: Mr. Speaker, may I ask a question. In view of the fact that the minister is raising all this new material which we have not had an opportunity to debate, I contend that he is doing an injustice to this house. If we are given an opportunity to meet the arguments and to discuss and debate the arguments which the minister is now advancing, I am willing to give him additional time to go ahead; but if we are not going to have this opportunity, I say let us not give him the extra time to go ahead.


Walter Lockhart Gordon: I thought my hon. friend was asking me a question, Mr. Speaker, but instead he seems to be questioning the decision, as I thought it was, of hon. members a few minutes ago that I should be permitted to continue. However, if there is a difference of view, and hon. members do not wish me to continue-


Some hon. Members:: Carry on.


Douglas Mason Fisher: Mr. Speaker, I wonder whether the minister would be prepared to accept a question? I would be glad to give it to him, if he would accept it. Would the minister comment on what appears in today's Toronto Star editorial, which reads:
Finance minister Walter Gordon's review of the Canadian economy in Hamilton last week must come as a disappointment to those who expect leadership and long range policies from a Liberal government.
I would ask the minister whether he would care to comment on this sort of partisan suggestion.


Walter Lockhart Gordon: I would be glad to, Mr. Speaker, after I have had an opportunity to read the whole of the editorial.


Douglas Mason Fisher: But is not this your Hamilton speech?


Walter Lockhart Gordon: My hon. friend is asking me whether I am now giving the same speech which I gave in Hamilton on Friday. Let me assure him that when I state the pertinent statistics concerning the Canadian economy I am not likely to change them very much from one day to another. As my hon. friend would expect there is a certain similarity. However, I want to move on to another point.
When the government's economic policies were announced a year ago last spring I seem to recall I was criticized for not suggesting tax cuts as then contemplated by the United States adminisration and which have since been enacted in that country. Those who favoured this course argued

and I think my hon. friend from Burnaby-Coquitlam (Mr. Douglas) was one of them-that the increased personal disposable income resulting from such a policy would give the economy the kind of fillip which it needed at the time. Now, unquestionably this would have been one way of stimulating expansion, but we estimated that a significant proportion, as I think I pointed out to my hon. friend before, of the additional expenditures resulting from a tax cut would have resulted in increased imports of consumer goods, thus adding to the current account deficit in our balance of payments rather than adding to employment opportunities in Canada.


Thomas Clement (Tommy) Douglas: Not if they were applied at the low income levels.


Walter Lockhart Gordon: Well, I would ask my hon. friend, where else would he think this government would apply such tax cuts?


Thomas Clement (Tommy) Douglas: I would be very glad to tell him.


Walter Lockhart Gordon: I would be glad to tell him too. To do the job for the purpose we had in mind they would, of course, have been applied in the place where they would do the most good. Another point we took into consideration at the time was this, that there could be no assurance that the whole amount of the tax cut would be diverted to increased consumer spending. In fact, this has so far proved to be the case in the United States where there are various estimates of the proportion which has been added to personal savings and not spent on purchases of goods which would have stimulated the economy.
In any event, the Canadian government decided that in the circumstances we faced in the spring of 1963 the most effective way

of expanding the economy and dealing with the unemployment problem was to encourage capital spending. I remember saying this a year ago, and it was the fact. This we did on a scale and in a manner which was not fully understood, I suggest, by some of the critics of our policies at the time. Nevertheless if I may say so I think the results have been right up to expectations. Not only has the Canadian economy made great strides, not only has employment increased and unemployment been reduced and not only are we very substantially better off now than we were 15 months ago, but the over-all performance of the Canadian economy has been appreciably better than that of the United States.
In this regard I should just like to put on record a few statistics, Mr. Speaker. The increase in industrial production between June 1963 and June 1964 has been 5.6 per cent in the United States and 8 per cent in Canada. The increase in total employment between July 1963 and July 1964, using the latest dates for which I have comparable figures, was 2.2 per cent in the United States and 3.3 per cent in Canada. The reduction in the rate of unemployment seasonally adjusted from July 1963 to July 1964-which I think is the best way to make the comparison-was from 5.6 to 4.9 per cent in the United States and from 5.9 to 5 per cent in Canada. Since July it has dropped to 4.8 per cent. The increase in merchandise exports for the first six months of 1963 and 1964 was 14.4 per cent in the United States and 22 per cent in Canada.


John George Diefenbaker: What about the percentage of imports? Have you got that?


Walter Lockhart Gordon: The imports have increased in Canada but not as much as exports, as my hon. friend suggested in his remarks. They have gone up because of this great capital spending program which has been going on. As one would expect, there have been importations of machinery and equipment, which was one of the things we were hoping would transpire.
No one can say with certainty that the Canadian record will continue to be better than that of the United States, but I can say with some confidence that based on the results of the past 15 months Canadian economic policies have paid off. There has been a tremendous upsurge in capital spending from which we are all benefiting and from which we shall continue to benefit in the months and years to come. I can only assume from this that hon. members in all parts of 20220-523
Alleged Failure to Meet National Problems the house will agree with me when I say that the economic policies introduced by the government in the spring and summer of 1963 have been vindicated by events.


Some hon. Members:: Oh, oh.


John George Diefenbaker: What were those policies which have been vindicated?


Walter Lockhart Gordon: I am afraid my right hon. friend has not been listening to me. As was pointed out a few minutes ago, I have been talking too long. I was urged not to go on any longer than I need because all hon. members are anxious to get on with the business of the country, so while I still have some more to say about the progress of the Canadian economy I will save it for another time.
Motion agreed to and the house went into committee, Mr. Lamoureux in the chair.
The estimates of the following departments were first taken up and entered for consideration.
DEPARTMENT OF DEFENCE PRODUCTION Emergency measures organization-
20. Administration and operation, $2,600,000.



DEPARTMENT OF FINANCE

[Stage Direction]
1. Departmental administration including administration of the Farm Improvement Loans Act, the Veterans Business and Professional Loans Act, the Fisheries Improvement Loans Act, the Prairie Grain Producers Interim Financing Act, the Prairie Grain Loans Act, the Small Businesses Loans Act, the salaries and expenses of the inspector general of banks office, and grants as detailed in the estimates, $2,710,400.

[Stage Direction]
1. Administration including the office of the superintendent of bankruptcy, grants and contributions as detailed in the estimates, gratuities to the widows and other dependants of judges who die while in office and authority to make recoverable advances for the administration of justice on behalf of the governments of the Northwest Territories and the Yukon Territory, $2,109,600.

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

[Stage Direction]
1. General administration, operation and maintenance including authority, notwithstanding the Financial Administration Act, to spend revenue received during the year from firms and individuals requiring special services, $44,388,500.

[Stage Direction]
1. Maintenance and operation of the Prime Minister's residence, $32,500.
8260	HOUSE OF
Corporations and Labour Unions Act

[Stage Direction]
1. Departmental administration including fees for membership in the international organizations listed in the details of the estimates, $5,180,500.
DEPARTMENT OF VETERANS AFFAIRS 1. Departmental administration, $6,491,400.
Proceedings reported.


Mitchell William Sharp: the second reading of Bill No. S-35, to amend the Corporations and Labour Unions Returns Act.
He said: Mr. Speaker, the Corporations and Labour Unions Returns Act was passed in April 1962 and became effective January 1, 1963. The legislation provides for the reporting of financial and other statistics relating to the affairs of corporations and labour unions carrying on activities in Canada. The purpose of the act was described at the time of its introduction to produce certain statistical information on the operation of the economy, the extent of foreign control, and effects of this control. In the course of the debate on this legislation in April 1962, the minister informed the House of Commons that the present form of the legislation was to some extent experimental, that there was a recognition of the importance of good relations with suppliers of data and that amendments to the legislation would be introduced in the light of experience. The amendments that are now before the house carry forward these assurances. The amendments, which affect mainly that portion of the act applying to corporations are designed first, to eliminate a substantial burden to some 30,000 large and medium-sized corporations who at present have to provide virtually the same financial information to the dominion statistician and the Department of National Revenue, and second, to eliminate duplication by these two separate government bodies, that is the dominion statistician and the Department of National Revenue, by establishing an integrated collection and tabulation procedure.
As will be recalled, the information on corporations collected under the Corporations and Labour Unions Returns Act is separated into two clearly defined classes. The first class includes information on directors and share ownership and is available to the public. This 

class of information would remain unchanged, except that the amendment will facilitate the reporting of information on the distribution of outstanding share capital by permitting this information to be reported as of any specified date within three months before the end of the fiscal year rather than at the end of the fiscal year only. Corporations frequently prepare this information for their own purposes as of dates prior to the fiscal year-end and this amendment is intended to allow a single tabulation by the company to meet the requirements of the act as well as of the corporation. This information is available to the public, and will continue to be available.
The second class of information reported under the act relates to financial statements and certain specified payments to non-residents. This financial information is confidential and is available for government use only. The remainder of the amending legislation applies to this class of information.
As previously indicated, the financial statements required by the Corporations and Labour Unions Returns Act are virtually identical with those submitted to the Department of National Revenue for corporation income tax purposes. Shortly after the act was proclaimed it was provided by regulation that a copy of the latter statement, as filed with income tax, could be filed with the dominion statistician as compliance with this portion of the act. This provision, while it helped respondent companies, did not fully satisfy them and suggestions were received from many firms that a single financial statement, the one received by the income tax authorities, should be used instead. To accomplish this, two changes are proposed in the present amendment. One of the amendments is designed to provide for the same certification arrangements under the Corporations and Labour Unions Returns Act as under the Income Tax Act. The other is designed to provide that corporations have complied with the requirements of the act, as far as financial statements are concerned, by submitting financial statements to the Department of National Revenue for taxation purposes. Other information now required under the Corporations and Labour Unions Returns Act-payments to non-residents and the information on directors and share ownership-would be submitted through the Department of National Revenue at the same time.
The amending legislation envisages also a single tabulation operation to meet the needs of both the dominion bureau of statistics and the Department of National Revenue after

financial returns are submitted to Ottawa. The Department of National Revenue now examines, punches and tabulates information on about 28,000 companies for its own purposes and in order to publish the annual volume known as "Taxation Statistics". The staff of the dominion statistician is required to do the same under the Corporations and Labour Unions Returns Act for about 30,000 companies, most of which are the same companies. An integrated operation has obvious advantages. The resulting combined data, as contemplated by this legislation, will be prepared on a single consistent basis, avoiding a degree of confusion which it would otherwise be difficult, perhaps impossible, to avoid. In addition to an annual report as required by the legislation, the dominion statistician would assume from the Department of National Revenue responsibility for preparation and publication of the corporation portion of the annual report, to which I have referred, "Taxation Statistics". This integrated program is made possible by giving the dominion statistician access to national revenue corporation tax returns, and this is one of the main purposes of the act.
Access by the dominion statistician to these tax returns calls for special measures to preserve the same sort of secrecy of corporation tax returns as now exists. This involves repealing that section of the Corporations and Labour Unions Returns Act which now gives officials of government departments access to financial statements under certain specified circumstances. The question naturally arises as to whether this is a serious loss. It appears to the government that the advantages of this arrangement considerably outweigh its disadvantages. In fact, during the one and a half years that the legislation has been in effect access to individual corporation records has not been necessary, and need by government for information has been satisfied by summary tabulations. It may be that access to individual company statements might be useful at some future time, but against this must be weighed the annual reporting cost and inconvenience to some 30,000 reporting corporations. Experience suggests, moreover, that less burdensome procedures could be used to meet these needs, and if members be used to meet these needs, and if members of the house would like some further information about this when the bill is before the committee I will be very happy to suggest what those alternative procedures might be.
I should state, in conclusion, that the amending legislation has been developed after 20220-523J
Corporations and Labour Unions Act careful study by the Department of National Revenue and the dominion bureau of statistics in consultation with other interested government departments. The present burden of duplicate reporting had given rise to many complaints and to suggestions from the business community that the returns required under the Corporations and Labour Unions Returns Act and under the Income Tax Act should in some way be consolidated. As I have already indicated, the proposed amending legislation will eliminate a burden to business, eliminate duplication in government departments, facilitate more effective processing of corporation financial statistics, and free resources to produce more comprehensive and detailed statistical studies and analyses which, in line with the purposes of the act, will throw added light on the operations of vital areas of the economy. Furthermore, these amendments do not in any way impair the information on directors and share ownership made available to the public under this legislation through the Secretary of State.


Mr. Aiken:: Mr. Speaker, may I ask the minister a question? Under this particular amendment to the act will the dominion statistician now have access to returns of all corporations and not just those which formerly had to file returns, and is this a relaxation of the original intention of exempting certain corporations and labour unions from filing these returns? If I read the bill correctly, while certain returns are not now required to be made by certain companies, this bill now authorizes the dominion statistician to look at any income tax return of any company without limitation.


Mitchell William Sharp: Yes, that is right, Mr. Speaker. It does that. It still preserves their secrecy, but it gives the dominion statistician access to more and better information than would be available under the corporation returns act. As I said in the course of my remarks, the dominion statistician will be taking over from the Department of National Revenue certain functions in connection with analysis and publication of statistics in summary form.


Mr. Smith:: May I ask the minister a further question? He said that many corporations had objected to the duplication of returns and had asked for simplification, but I wonder how many corporations or organizations representing business corporations have suggested that the dominion statistician be provided with access to their income tax returns?
8262	HOUSE OF
Corporations and Labour Unions Act Did that suggestion come from any business organization?


Mitchell William Sharp: Not so far as I am aware, Mr. Speaker.


Marcel Joseph Aimé Lambert: Mr. Speaker, this bill appears to be very innocuous, but I should like to point out to the house that its implications are far greater than the minister has led us to believe. I think that the last two questions put by the hon. member for Parry Sound-Muskoka (Mr. Aiken) and the hon. member for Simcoe North (Mr. Smith) have pointed this up. In any event, I agree there was a fundamental departure with the introduction of this legislation in 1962, and I think at that time there were certain people who, frankly, were a little dubious about it and had reservations.
The legislation was effective from January 1, 1963 and already we have certain amendments being put forward on the basis of the introduction of a bill in the other place. With regard to the first class of information required under part A concerning shareholdings and so on, I dare say there are some advantages in having a degree of flexibility so that the shareholdings shall not be those listed on the last day of the fiscal period. The question of whether the period should be three months, 60 days or only one month is a matter for decision, and perhaps on the basis of experience a period of three months was found to be more flexible. I have no further reservations with regard to that point except that I think a period of three months does allow for certain changes to take place which might otherwise be shown in the intervening period.
However it is with regard to the second class of information to which the minister has referred that I part company with him. We are being asked this afternoon to underwrite what is really administrative convenience. There is an inviolate principle of confidentiality with regard to income tax returns. We know that in other sectors it takes an order of the court to bring about the production of an income tax return. Corporations, like individuals, are entitled by law and by tradition to confidentiality of their income tax returns.
The information that is sought in part B is the same fiscal information which the company is required to file under certain safeguards of secrecy. The minister said it is virtually the same information supplied in the income tax return, but it is not the same information. In that regard I should like to


have the minister define just how "virtually the same" it may be. What is the degree of similarity between the return filed with the Minister of National Revenue and that required to be filed with the dominion statistician?
I can understand quite readily that a corporation may be prepared to file a second copy of its income tax return with the dominion statistician voluntarily and may signify its willingness to do so, but for the law to say that its income tax return shall be the equivalent to the return required to be filed under part B and that the dominion statistician shall have the right to enter into the records of the Minister of National Revenue with regard to corporations and extract the required information from those returns is another thing. In addition, not only is the dominion statistician to be authorized to examine the income tax return for the information now required under part B, but this amendment will authorize the dominion statistician to examine any and all information, relevant and otherwise, filed by a taxpayer. My colleagues point out that I may have created a little confusion. I mean a corporate taxpayer, because after all we are not talking about individuals here.
But why is this being done? The minister indicates that the purpose is to introduce an integrated operation and that the dominion statistician will now take over the preparation of the annual statement of statistics compiled by the Minister of National Revenue and which is prepared by his officials in summary form. Any taxpayer knows that the information on which it is based is absolutely inviolate so far as secrecy is concerned. We are being asked to authorize another individual or officers under his jurisdiction to enter into the Department of National Revenue.
Already we find a great reluctance among the general public to answer questions with regard to the census because they fear that another government department may have access to this information and may create some difficulties. This reluctance on the part of the individual often leads either to a refusal or to difficulties with the census taker. If for the purpose of integrating operations under the act under consideration at the present time, the Corporations and Labour Unions Returns Act, and the Income Tax Act we are going to allow the dominion statistician to have access to corporate income tax returns, then I say this is more than the thin edge of the wedge. If today it is the dominion

statistician, tomorrow it may be another individual in the government service. I cannot see why-I have great reservations about this-for reasons of administrative convenience, we are extending or derogating from the principle of the confidentiality of income tax returns.
I wonder why it is found that so many concerns have expressed objection to the filing of this information; yet they do. They object also to supplying statistics for the Unemployment Insurance Act or the Statistics Act. This is another return for the government. Parliament has decided that this information dealing with the degree of foreign control of corporations and other related matters should be available. It is information which would otherwise have to be obtained by examining income tax returns. The previous administration, I think, respected the principle of the confidentiality of income tax returns. In my opinion they acted rightly. If a corporation, however, wishes to give a copy to the dominion statistician for the purposes of the Corporations and Labour Unions Returns Act, that is its own decision. It waives the secrecy of its own return. However, these amendments take away the secrecy of these returns, although they do clothe the accessibility with a certain degree of secrecy.
These amendments, Mr. Speaker, go beyond what was indicated by the minister's presentation. It is not only the return that is to be filed with the Minister of National Revenue which would be deemed to be a statement filed for the purposes of the Corporations and Labour Unions Returns Act, but it gives access to further documents and further information. In other words, under the proposed amendment the dominion statistician can wade through, willy-nilly as he desires, all sorts of returns and information filed by a corporate taxpayer. I do not believe this is right, and I am opposed to this sort of thing.
I think myself that if we are going to have acceptance of the continuation of a principle of confidentiality of income tax returns, it should be extended to the corporation as well as the individual. Why should it be respected for an individual and not a corporation? There are many men in business on their own who are quite as successful and earn just as much as, if not more than many corporations. However, nothing is being asked of them; their returns are to be left alone. Under these proposed amendments we create two categories of taxpayer in so far as the secrecy of returns is concerned. I do not believe that
Corporations and Labour Unions Act is right. A man in business on his own, who may be very successful, should be in the same position as a corporate taxpayer; or vice-versa, the corporation should be in the same position as the individual in so far as the inviolability of the tax return is concerned.
I myself am not satisfied with the explanation of the minister. I must say that I would much prefer to hear a clearer and more detailed reason as to why this rather extraordinary step is being taken. I can see that it will be a nice, neat package, or it would appear to be so, from an administrative point of view. But where do we stop administrative convenience at the expense of the rights of individuals, be they persons or corporations? I am quite anxious to hear the minister reply to these few remarks. I think any further remarks I have to make will be made at a later stage in the debate, depending on the decision of the house with respect to these amendments.


Stanley Howard Knowles: Mr. Speaker, I had hoped-


An hon. Member:: Six o'clock.


Stanley Howard Knowles: I am getting lots of advice that it is six o'clock, and it is, Mr. Speaker.


Mr. Deputy Speaker:: Is it the desire that I call it six o'clock?


Some hon. Members:: Agreed.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 8 p.m.
Stanley Howard Knowles: Mr. Speaker, there are three things I want to say about this bill, second reading of which is now before the house. It is always risky for a speaker to say in advance how many things he wishes to say because he may think up other things as he goes along. However, to begin with there are three things I want to say.
First, I am disappointed that the Minister of Trade and Commerce (Mr. Sharp) in introducing this legislation did not give us something in the nature of a report on the act which it is proposed to amend. I think he should have told us whether it has been found to be worth while. I think he should have told us what its purposes are and whether or not those purposes are being realized. In fact I think he should have posed
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Corporations and Labour Unions Act for us the question whether or not the Corporations and Labour Unions Returns Act should be continued at all. I shall return to that point later, but for the moment that is the first heading I have in mind this evening.
The second observation I want to make is that unless the minister can persuade me otherwise it looks as though the amendments proposed in Bill No. S-35 are discriminatory-in favour of corporations as against trade unions. Perhaps I should develop that point right now. The main purpose of these proposed amendments, as I understand it from the remarks of the minister and from reading the bill, is to simplify the task which corporations face in completing and compiling the returns called for under the Corporations and Labour Unions Returns Act. The main way in which this simplification is to be achieved is by permitting corporations which make returns under the Income Tax Act to be excused from making similar or comparable returns under the Corporations and Labour Unions Returns Act. This looks very innocent on the face of it, but what it does is to bring the kind of information which corporations are required to file under the Corporations and Labour Unions Returns Act within the secrecy provisions of the Income Tax Act.
There is no suggestion anywhere in this amending legislation that the same privilege is to be accorded to the trade union movement. Rather, the whole amending bill deals with corporations and, as I see it, it allows them a cloak of secrecy with regard to this information which they do not now possess. That, it seems to me, is contrary to the whole spirit of the original act as it was brought in by the previous government. After all, the whole purpose of that act was to bring to light certain things which were of concern to the previous government. That is being forgotten and there is an element of discrimination in what the government now proposes as a remedy. I do not know whether "remedy" is the word. It is a concession to firms which have found it awkward or onerous to supply this kind of information.
The third comment I wanted to make is that I cannot weep any tears with the hon. member for Edmonton West (Mr. Lambert) because there may be some invasion of the inviolable secrecy of the Income Tax Act as far as the corporations are concerned. This of course to the hon. member for Edmonton West, and no doubt to hie friends, amounts to invading the holy of holies. As hon. mem-


bers know, many years ago I did in fact introduce a bill to amend the Income Tax Act so as to remove the veil of secrecy from corporate income tax returns when information filed in that way was sought in either of the houses of parliament. So I do not think the Minister of Trade and Commerce need pay too much attention to the criticism which has been made of this legislation by the hon. member for Edmonton West and which, no doubt, will be made by other members of the Conservative party if they speak on second reading of this bill.
As a matter of fact-and this comes under at least two of the headings I have in mind tonight-I am surprised that the hon. member for Edmonton West, who belonged to the party which was in power when this legislation was brought in, should wish to clamp down a veil of secrecy. After all, the whole purpose of this legislation was to find out what the story was with respect to the influence of foreign entities, either corporations or trade unions, in the economic life of this country. I hear the hon. member for Simcoe North (Mr. Smith) telling me quietly that I have misinterpreted what the hon. member for Edmonton West had to say. If I have done so I will be glad to correct what I have said. But the concern which the hon. member for Edmonton West is showing for the secrecy provisions of the Income Tax Act is a concern which somehow gets shown with particular feeling when corporations are involved.


Gordon Harvey Aiken: Does this not apply to the unions, too?


Stanley Howard Knowles: I assume that my hon. friend from Parry Sound-Muskoka must have come into the chamber since eight o'clock.


Gordon Harvey Aiken: Yes.


Stanley Howard Knowles: That gives me the right to disregard the rules against repetition and point out to him that the amending bill being brought in by the Minister of Trade and Commerce permits corporations under this act to file their information under the Income Tax Act instead of under the Corporations and Labour Unions Returns Act, and therefore to take advantage of the stricter secrecy provisions of the Income Tax Act. But that right is not accorded to trade unions. I suggest, Mr. Speaker, that is an element of discrimination that should not be introduced.
May I go back, however, to the first point I made and say to the Minister of Trade and Commerce that I hope when he takes advan-

tage of the opportunity that will be his to close the debate on second reading he will tell us something about this act. After all, he was not here when it was passed, but I do not think his party, in opposition at that time, was very enthusiastic about it. Surely the minister must have some idea as to whether it is worth having on the statute books; as to whether it is worth all the trouble to which it puts both corporations and trade unions, in order to get this information. I agree with the minister that it is good to have information. I may point out, Mr. Speaker, that when the Canadian Labour Congress spoke against the enactment of this legislation even before it was proposed, it made clear that it was in favour of the collection of all information necessary for the efficient running of our economy. But 1 suggest that the purpose of this legislation was more than just an academic interest in the collecting of information. Indeed there was at least in part a malicious intent in the legislation.
I think we should be told by the minister who is responsible for the branch of government that is administering this act whether anything of use has come to light during the time this information has been collected. I believe we should be told whether anything has been proven by the collecting of this information. The minister told us-and other figures that we have substantiate it-that some
29,000	or 30,000 corporations are filing returns. He told us that at the present time both the dominion statistician and the Department of National Revenue are punching cards to compile all this information. In addition to that we know that about 100 international unions and about 50 national unions are filing the same information and that all this information has to be punched, compiled, computed and tabulated.
We are for information being obtained. We think we should have all that is necessary. But is this information necessary? Is it providing anything? Is it being helpful? Let me put it another way, Mr. Speaker: is any information being obtained as a result of this legislation and all the work that goes into carrying it out that is not obtained in other ways? On the side of the corporations, is not all the information that is obtained under this act obtained either through the operations of the Income Tax Act or through the publishing by corporations, under the requirements of the Companies Act and other legislation, of their annual financial statements?
Corporations and Labour Unions Act
I ask the same question with regard to trade unions, both international and national. Is not all the information that is obtained by the operation of this act made public already by the annual statements that international and national unions publish in connection with their conventions, which they hold freely and openly throughout this country?
I come back to the position taken by the Canadian Labour Congress when this legislation was first brought in. The congress, through its officers, appeared before the government of the day on February 2, 1961, and noted that the speech from the throne that had just been given disclosed that there would be legislation introduced along the lines of the Corporations and Labour Unions Returns Act. The congress at that point said that of course it would have to wait to see the legislation before it would make detailed comment; but it did say this, which I think still holds-and I am reading from the brief of the Canadian Labour Congress to the government of the day on February 2, 1961:
We would like to comment, however, that there are important distinctions to be made in the matter of disclosures as between business and labour organizations. As you are undoubtedly aware, to a very large extent the financial and other affairs of foreign-owned subsidiaries in Canada remain very much matters known only to the foreign headquarters of these subsidiaries. Such subsidiaries, while physically located in Canada, may be so controlled from abroad and so manipulated as to operate contrary to rather than in the Canadian interest. It is obviously desirable, therefore, that the veil of secrecy which surrounds their operations should be removed and that the people of this country should know at least as much about these subsidiaries as they are able to learn about Canadian-owned public corporations.
It might be argued that the legislation as it was put upon the statute books in part at least met that desire. If it did, that is being detracted from now by the opportunities corporations will have to file their returns in such a way that they will be under a strict veil and cloak of secrecy. Let me read another paragraph from this 1961 brief of the Canadian Labour Congress:
For international trade unions, the case is somewhat different and we are inclined to take exception to the coupling together of business and labour organizations since to our mind they cannot be so readily equated. But the record will indicate that there is far less secrecy about the operation of international unions in Canada than is the case with international corporations. The constitutions of our unions are open to scrutiny to anyone who cares to examine them. Almost all unions nowadays publish detailed financial statements in a way which makes them available to the public as well

Corporations and Labour Unions Act as to their own members. Union conventions are held openly. In fact, there is no institution in Canada today which has been so minutely scrutinized in recent years as the trade unions, and the public's ability to do so rests largely on the fact that there is little or no secrecy attached to union activities. We are therefore not likely to upset readily any legislation which will interfere with the internal affairs of the trade unions by making mandatory what is already done voluntarily, or by imposing rules and regulations for the conduct of trade union affairs which more properly should be done by the unions themselves. The century-long record of the trade union movement in Canada does not warrant any legislative interference.
It might be said that this was the view of the Canadian Labour Congress when all it had was warning in the speech from the throne that this legislation was coming. It might be said that body should have waited until the bill had come to light. I draw the attention of hon. members to the fact that after the bill had been introduced and passed, and during the time when it had not yet been proclaimed, the Canadian Labour Congress appeared again before the former government -this was on December 11, 1962-and had this to say about the very legislation which then had been passed and which we are now being asked to amend:
We have on two previous occasions referred to the Corporations and Labour Unions Returns Act. We have expressed strong criticism of it. We have challenged it on grounds of principle as well as for technical reasons.
A fresh examination of this legislation has served amply to confirm the feelings we already had. We are persuaded that the act, to the extent that it affects trade unions, will Impose on them unnecessary and onerous burdens in the matter of reporting a variety of kinds of information. This will be a hardship for smaller unions in particular but may seriously impede the legitimate activities of all unions. A great deal of paper work will be involved and it is altogether possible that unions will find it necessary to make constitutional and other procedural changes in order to satisfy the requirements of the act. In addition, the ambiguity or lack of clarity of some of the provisions gives us further cause for apprehension.
That was the view of the Canadian Labour Congress about this legislation after it had been passed. That was part of the brief presented to the former Conservative government on December 11, 1962. In the very next paragraph there is a sentence in which the congress urged the government of that day not to proclaim that legislation. That request that it be not proclaimed was made on December 11, 1962, and the response of the former government was that it was proclaimed effective January 1, 1963. In any case it was the view of the Canadian Labour Congress that this legislation as far as trade unions are concerned was not necessary, and that any infor-

mation required from trade unions was readily available. Nothing is being done in this amending bill to make the situation less onerous for trade unions; as far as corporations are concerned it is being made less onerous, and as part of the bargain they are also given the means whereby the information supplied can come under the veil of secrecy which obtains under the Income Tax Act.
Therefore, Mr. Speaker, it seems to me that instead of the casual introduction of these technical amendments which the minister gave us he should have told us quite frankly whether in his view as a Liberal cabinet minister this legislation is necessary at all, and I hope that at the end of the debate on second reading he will tell us what he failed to tell us at the start of the debate.


Heber Edgar Smith: Mr. Speaker, sitting as close to the hon. member for Winnipeg North Centre (Mr. Knowles) as do the hon. member for Edmonton West (Mr. Lambert) and I, it is hard to understand how the hon. member for Winnipeg North Centre could have so completely misheard what my colleague was saying this afternoon. Our objection to the extension of the powers of the dominion statistician to inspect the income tax returns of companies is not that it protects the companies concerned; it is that it puts into the hands of the dominion statistician unnecessary information which could be misused. Beyond that, it could also inhibit the operations of this particular act. If a company voluntarily submits the information to the dominion statistician, as it would do to the income tax authorities, then that is all right. Our objection to these amendments is that they will not make the operation of this act more efficient.
It seems to me that the explanation given by the minister this afternoon was rather casual and slight. I am not even sure that he had his heart in it, because at a certain stage of his explanation he rather tried to suggest that this bill was merely an extension of Conservative legislation. I am sure that if he was proud of it he would not have made that concession. Actually that is not so: This bill is not an extension of our legislation.
I think that before this debate closes we should have a considerably fuller explanation of the amendments than we have had. For example I would want the term "virtually identical" explained. I think we should have a complete explanation of what is required by the dominion statistician and what is required under the Income Tax Act. I am wondering whether the amendments are not being made

an excuse rather than filling a need. The minister says that many corporations have objected to filing these returns. Most people in varying degrees object to making returns to the government. Every time one makes out another form he says: "What the so-and-so am I doing?" I am wondering whether that is the kind of objection to which the minister refers and whether the people interested in extending bureaucratic control have not seized on this rather general objection to specifically widen bureaucracy in the government.
The hon. member for Winnipeg North Centre says that this legislation is loaded in favour of permitting the companies to become more secretive, thus rendering this particular legislation less effective. I do not think that is the purpose, but if it is we should know about it. We should also know whether or not the corporations, through their organizations, are in favour of it. We have heard nothing from the minister about what the various tax associations and other business organizations feel. Perhaps rather than dealing with the matter now this bill could be referred to our banking and commerce committee, and if these organizations wanted to make representations the opportunity would then be given them. We could also hear representations in a general way from the Canadian Labour Congress and other labour organizations.
It seems that the more one looks at this the greater are its implications. I think it would be dangerous just to slip this legislation through as routine, having been blandly assured that it is merely an extension of former legislation. I feel that rather than an extension of former legislation it is changing the course of that legislation, the purpose of which was to make public certain matters. Under the amendments those matters which were to be made public are perhaps going to be made secret.


Douglas Mason Fisher: Mr. Speaker, I should like to review the original course of this bill. I think it is worth noting that when it was introduced by the then minister of justice, Hon. Davie Fulton, it was portrayed as being a rather hardy jewel which was being placed on the Conservative party crown of nationalism. The bill was brought in in 1962 after considerable delay, and at that time those of us who were in the house were somewhat surprised at the attitude of the official opposition, who put up as their main speaker and critic the hon. member for Hull (Mr. Caron). He gave the 20220-524
Corporations and Labour Unions Act house no indication that the official opposition was against the purpose of the bill but he did make some criticisms about specifics. Surprisingly enough the bill was debated for quite a long time, I think a total of about four days, and things became rather bitter between the minister as proponent and members of the opposition, including my colleague from the constituency of Skeena (Mr. Howard).
I have two points I want to make. First of all, the Conservatives presented this legislation as one of the most important pieces of legislation leading to the development of Canadian nationalism, particularly where corporations and trade unions were concerned. The official opposition's attitude was not critical, but it was never really explained whether that party was for it, was enthusiastic, or whatever the case was. However, I think it is fair to say that a certain amount of cynicism about the bill and the intentions of the government of that day was expressed by Liberal spokesmen, particularly the hon. member for Bonavista-Twillingate (Mr. Pickersgill).
Just to reinforce the emotion with which the bill was presented I should like to read a paragraph from Mr. Fulton's presentation, as reported at page 2396 of Hansard for April 2, 1962. He said:
This is an extremely important bill, and it forms an integral part of the government's national policy.
Those words "national policy" are fateful words, as the Minister of Trade and Commerce (Mr. Sharp) will acknowledge. Mr. Fulton went on:
Canadians are becoming increasingly aware of their nationhood and of the importance of developing to the full the cultural, social and economic resources of this country. This bill is directly related to the efforts the government has been making in such fields as the domiciling of our constitution in Canada, and also to the numerous steps the government has already taken, and is taking, to encourage the development of the nation's resources, their control by Canadians and their use primarily for the benefit of Canada.
In other words, this bill originally had a very noble purpose, I suppose part of the psychology was that by including all corporations above a certain level of revenue it would make them-particularly the ones that were foreign subsidiaries controlled from the United States-self-conscious about their Canadian operations, realizing that the government was looking at their shareholdings and the profits that were being taken out. This may have been a very good thing, but we do not know. Is it working? The minister gives
8268	HOUSE OF
Corporations and Labour Unions Act no indication at all that it has been useful in this regard.
One other point that was made in connection with the act, and I take this also from Mr. Fulton's statement, was referred to when he said in conclusion:
I should like to conclude with a few remarks as as to the policy of the bill. In the first place, as I have already stated, it is in a sense a first step. Second, it is designed to enable the government to understand the operations of the Canadian economy, an economy which admittedly owes much and will continue to owe much to foreign investment. However, no nation which calls itself sovereign can be careless of the extent of results of foreign control of vital segments of its economy. It is essential that we should at least understand careless of the extent or results of foreign control so that we may be able sensibly to determine the policies which should be followed in order to direct our own affairs as Canadians in the kind of world in which we live.
Again this was a very charming closing to the introductory speech to the bill.
The minister does not give us any indication at all that this act is working in this regard. All we really know or have is a report that was filed in answer to a question asked by the hon. member for Bow River (Mr. Woolliams), which indicates that all the international and most Canadian unions have reported, and that some 20,000 odd corporations have also filed reports. I must say that I am delighted to know that that many corporations have complied with this act, because we heard Louis Lesage, the fellow who administers the Companies Act in another place, reveal something the other day that some of us found out a few years ago in so far as the Companies Act is concerned, and that is that the reports that are required by that act are being ignored by thousands and thousands of Canadian corporations.
This brings me to another point in relation to this bill, and again I am going to stress the fact that we have been given undertakings in this house-by the previous government I will agree-to the effect that the whole Companies Act was to be revised after interdepartmental discussion and after many meetings with provincial representatives so that, as Canadian chartered accountants and other business organizations wanted, we would join in having a common, rational and balanced company law throughout Canada. We have amendments coming from the other place at the present time to the Companies Act. At the time the original proposer of this bill proposed it, he suggested that this had been considered-that is, a change in the Companies Act to get this particular information-but it was felt that since the federal Companies 

Act did not sufficiently cover the corporations that needed to be considered, this could not be done at that time. I suggest if we are going to have a complete rewriting of the Companies Act, with standardization across the country, this is exactly the kind of thing that should be codified in co-operation with the provinces, so as to obtain this kind of information. That is why I wondered about these piecemeal small amendments at this time.
At the time of the original proposal the proposer said that the question had been considered of obtaining the information from the Department of National Revenue rather than having this report sent to the dominion statistician, but it was felt since the government was willing by this act to accept merely a copy of what was going to the Department of National Revenue, and since copying is very easy for corporate organizations-necessitating the use of Xerox machine-there was no real inconvenience, and the information could be largely identical, but it would go to the dominion bureau of statistics.
In the other place the dominion statistician suggested there is a great deal of duplication in terms of statistical analysis in this area. He pointed out that in respect of the taxation statistics that are published by the Department of National Revenue each year there is a duplication, and it is all punched out. This is not my understanding of the kind of information that was being sought. I cannot find any taxation statistics in Canada that give any real indication or understanding of the extent of foreign shareholdings in Canadian corporations. I cannot get from that information any indication as to the trends of shareholding or the amount of profit going to the parent organizations. Most of this kind of information I will admit should perhaps not be coming to me or any other individual, because this information probably is collected under clause 4(b) of the act.
However, I want to know whether the government really is getting and analysing this information. If we are merely by this amendment pawning off the right of the dominion statistician to look at the files or information collated by the Department of National Revenue, that is not good enough because the Department of National Revenue does not analyse this information from the point of view of the original purposes of this act.
This government is on record, largely through its Minister of Finance (Mr. Gordon), of being extremely vigilant. We remember the budget of 1963 and how terribly vigilant

the government was in repatriating Canadian ownership back into the Canadian financial community. Most of us can remember those provisions in the minister's budget of which he was so proud this afternoon, but which were wiped out very early. Why were they wiped out? I suggest they were wiped out because there was such an objection raised in respect of the changes that were going to affect United States ownership the government had to retreat. So far as I am aware the Minister of Finance has not retreated from his belief that one of the prime problems that faces the federal government of Canada is finding a method of obtaining a greater share in Canadian ownership, and finding out what we can do to reverse the trend.
One of the little games the Liberal spokesmen played when the Conservatives were in power was for them to point out that there was a trend toward greater United States ownership of Canadian resources, despite Conservative policy designed to put a stop to this and bring Canadian ownership back into the picture. I suppose we can now play that game and suggest that there is no indication at all that the Liberals have been able to stop this trend. Certainly the Minister of Finance backed down from his original approach to the matter. There has been a clear indication through the Minister of Finance that this government is as concerned as the previous one and in the same way, as indicated in those submissions put forward by E. Davie Fulton when he first presented the bill. That is why it is so hard to understand -unless the Minister of Trade and Commerce does not wish to put himself under the same blanket-why he would in a sense almost sneak in with these amendments. We have never had any real indication that the party now in government stands behind the original policy and purpose of this bill. We are no nearer to such an understanding, and that is why I agree with the hon. member for Winnipeg North Centre when he says that this is something we deserve to know. We also deserve to know whether the shifting of information from the repository or files, if you want, of the dominion bureau of statistics, to the Department of National Revenue is really going to be satisfactory, and I must tell the minister that if he reads the evidence given before the committee of the other place by the dominion statistician I am sure he will find it is not an adequate explanation. It seemed to me as though the worthy gentle-20220-524i
Corporations and Labour Unions Act men were in a hurry to get on with it, and they did not bother to probe or ask questions.
It also raises another point which bothered me when the original bill came before the house. Why is it that the Senate gets the privilege of examining this legislation in committee and we do not? I cannot understand this. Maybe the idea is that since this piece of legislation relates to corporations and since the Senate is the old folks home for corporate directors it should be their particular prerogative and we "ickies" and "stupes" over here can really be bypassed. I do not think that is quite good enough. I should like to suggest that we should have a look at this bill in committee, inasmuch as a committee of the other place has had an opportunity to look at it.
I really do not feel that these amendments are of tremendous significance although they do have this significance. The bill is an indication that officialdom at least has lost its enthusiasm for cracking down and securing and using the information that was really intended to be sought. That is the first point. The second thing that is quite obvious is that the government is not enthusiastic about the bill as a whole, and I would assume that the legislation is going to waste away.
There are a couple of informational questions I should like to put to the minister. Will he let us see the forms that have been used in order to gather information under this act, or at the very least will he give us the notation in the Gazette where these forms were printed and published? The second thing I should like him to provide for me, and I hope for other members of the house, is the report that we were promised would follow from this legislation. I still have not seen it. Maybe I have missed it in my checking of sources. But I always understood that after the act had been operating for some time a thorough report would be presented together with an analysis of all the information that had been gathered. It was not going to be any really serious or consequential report because that would be ridiculous if you have 2,000 corporations reporting, but we certainly assumed that the information would be analysed, particularly with regard to trade unions.
For example, we have had Hal Banks and the S.I.U. on our minds for at least 15 or 16 months. The S.I.U. is an international union and I assume it has reported under this act. Maybe the Minister of Labour (Mr. MacEachen) can tell us. For example was any useful information with regard to Mr. Hal

Corporations and Labour Unions Act Banks' salary, his expense accounts and other reputed incomes revealed?
The point is that we have not been given the significance of the results that have been obtained under this act. Basically the purpose was to gather interesting statistics which I suppose were to give a psychological push to opening up information about Canadian ownership, perhaps to give both Canadian unions with international connections and Canadian companies under foreign domination or ownership an inkling that there was a trend or tide in affairs that must lead to greater Canadian participation in ownership, a declaration of our rights, if you will, in these two fields.
I feel that the minister has been completely inadequate in commenting on this legislation. We were not looking for a major speech, but at the very least he should have given us a succinct account. Perhaps he is all burnt out after his efforts over the week end. I must congratulate him on coming back to the house after his defeat with such a smile. I also see the hon. member for Renfrew South (Mr. Greene) over there. I think the minister could have done better than this.


Thomas Clement (Tommy) Douglas: He could have done better away.


Douglas Mason Fisher: Perhaps he could have done better in Toronto. I think he could have done better with his introduction of the bill. The last point I want to make in connection with this matter has been touched on by the hon. member for Winnipeg North Centre (Mr. Knowles). At the time the original legislation was introduced he was an interested onlooker because of his association with the labour movement. I happen to be one of the members who was in the house at the time and I had the very distinct impression that one of the reasons why we got this rather odd coupling of corporations and trade unions sponsored by the minister of justice of that time, and with the results to come to the dominion bureau of statistics, instead of trade unions being under the Department of Labour and corporations being under the Department of Finance or the Secretary of State, was that the government of the day felt that it would be the best way to get the thing through. If the corporation people kicked it could be pointed out that their rivals were getting it in the neck too, and vice-versa. Actually I think this was rather a successful ploy, if you will, because there was a tendency for corporations to

welcome information coming from trade unions and vice-versa.
I think the minister takes pride in being a reasonable man and a tidy administrator. I suggest he should give us his opinion whether he thinks the present act, even with these amendments made to it, is a tidy one. Is there not something rather silly about having trade unions reporting in this particular way and corporations reporting in this particular way, under the one act? It is not tidy and it is not sensible except in terms of some form of anti-Americanism. I do not see why a statute which will require statistical work and research should be set up on such an awkward basis.
There are all kinds of wiping away clauses in the bill. The railways do not have to report under this legislation. Why? Because they come under the Railway Act. Radio and television stations do not have to report because they come under such and such an act. I have a complaint about American ownership in Canadian broadcasting. I have a complaint about American ownership in the Canadian Pacific Railway. We do not know to what extent that exists. But if the purpose of the bill is to provide a continuing analysis of American ownership and control of corporations and trade unions, then I say let us bring all corporate organizations within its scope instead of having them split up and reporting under a whole host of acts. We are not really getting the information, so I suggest that in the interest of tidying things up and having proper administration you should put trade unions under the industrial relations act, or some of the other acts that come under the Minister of Labour, if you want this information from them; and if you need this information from corporations let us bring the reporting of all companies together, no matter what their operations may be, so that we can have a statistical analysis.
I put it to the minister that there is a television station for which his friend from Essex East used to be counsel-perhaps he still is-which everybody knows is 90 per cent owned by Americans. I assume that the statistics for that company are not covered by this act. How are we going to get a picture of the trend? The minister tells us that all he needs are summaries and that summaries will do the job. Obviously the summaries are incomplete. They must be incomplete because so many companies are not covered under the act, but under other legislation.

I suggest to the minister that he might even consider withdrawing the bill and tidying up the whole matter by some larger piece of legislation that would bring all information of this kind together, with corporations probably under the Department of Finance or reporting to some agency thereof and trade unions reporting to the Department of Labour. I have been carried away by my memories of the previous debate and have probably spoken too long, but I hope I have contributed, if not to the enlightenment of the minister, to the enlightenment of a few of my colleagues who may have forgotten the presentation that was made when the act was originally introduced.


Gordon Harvey Aiken: A reasonably comprehensive review of the legislation which is being amended has been given by several hon. members in this debate. However I believe the heart of the bill before us and of the amendment itself is contained in one clause, that is clause 4-I do not intend to deal with the various clauses-which adds section 14A to the act. In my view, Mr. Speaker, the addition of this one clause completely alters the whole purpose, intent and direction of this information act.
The original act, Mr. Speaker, as has been pointed out, was introduced in order to obtain certain information concerning non-resident corporations carrying on business in Canada, labour unions with head offices outside of Canada, and so on. This information was believed to be necessary in order to obtain a broad picture of the operations of these non-resident companies, as well as resident companies and labour unions in Canada. The act, as passed in 1962, was very carefully drafted so that it would constitute no invasion of the privacy of income tax returns or other forms. Careful provision was made to ensure that no return should be made except to the dominion statistician and that that return should only have non-secret information in it, the type of information to which competitors, governments and others would be entitled in the normal course of business.
The present bill rearranges the whole purpose of the carefully designed original act because clause 4 will now permit an individual from the dominion statistician's office to go to the income tax office and examine the income tax return of any corporation in Canada under the guise of obtaining certain information. I believe this is a principle that has never been put forward before. I believe it is a breach of the confidentiality of income
Corporations and Labour Unions Act tax returns. In fact, what the government is saying in introducing this amendment is this: We are going to save you a little bit of trouble in filing those other returns; you will not have to file those special returns under the Corporations and Labour Unions Returns Act. We are going to examine your income tax return and take out of it what we want. This I believe, is the basis of the amendment. The whole principle is wrong and I am going to cast my vote against it unless there is some proposition made to refer this bill to a committee for amendment before it is given second reading.
I think that the principle in clause 4 is basically wrong. I could not possibly vote for it. Some people, like the hon. member for Port Arthur (Mr. Fisher), may say that as soon as you mention corporation the members of the Conservative party jump to their defence. This is more serious than that, because it constitutes what is known as the thin edge of the wedge with regard to income tax returns. I should like, for example, to indicate what the passage of this amendment could do. Clause 14 permits the dominion statistician or any official described in subsection 4 of section 14 to inspect and have access to any return filed or made on behalf of any corporation pursuant to the Income Tax Act.
Now, you may say the information will not get beyond the dominion statistician's office or that the dominion statistician will not take any more information than he really needs. There is nothing in this act however to prevent that happening. This is particularly so in view of clause 14, subsection 5 of the original act which authorizes any official of the dominion statistician's office to obtain this information and to communicate it, (a) to another such person, that is a person such as himself or, (b), to allow any other person to inspect or have access to any statement or any writing containing any privileged information given under this act. These are the people who may give out any of this information. In effect therefore any corporation that has filed an income tax return is legally liable to have someone from the dominion statistician's office go and examine the income tax return, take out whatever the dominion statistician feels he needs for the purposes of this act, and he can then pass it on to any other person to whom he is inclined to give it.
This is carrying it too far. One of the things that has built up confidence in the administration of taxation measures in this country is the fact that the Department of National
8272	HOUSE OF COMMONS
Corporations and Labour Unions Act Revenue refuses to give out information contained in tax returns about the private affairs of a company which would be useful to its competitors or would be useful even to the crown in the right of the minister of justice on a criminal charge. The public in general, therefore, has extreme confidence in the confidentiality of their returns. These returns are filed accurately, or at least as accurately as one can hope, without any fear that someone is going to extract information from a return and make it public.
You may say that this is all done in a nice, accounting sort of way, that it is drawn up in tables and no company could be identified or picked out even if the dominion statistician wants to take more information than was originally allowed under this act. However there are many fields of endeavour in which a limited number of companies are engaged. This is just like the voting in some of our remote areas in which perhaps only one person votes. Certainly the secrecy of that particular vote is gone. Moreover if only three people vote and they all vote one way the secrecy of the vote is gone.
The situation is similar here. There must be many fields of business and manufacturing in this country in which there are limited numbers of people involved, and any return which showed more information than was strictly necessary could surely be traced back and be used in the manner I have mentioned. These are the things that are serious.
Moreover, this is a breach of the principles set out in the Income Tax Act where a penalty is provided for any person giving out confidential information to people who are not entitled to receive it. I presume that in addition such a person would be liable to dismissal. I should like to read from section 133 of the Income Tax Act which states, in relation to such communications:
Every person who while employed in the service of Her Majesty has communicated or allowed to be communicated to a person not legally entitled thereto any information obtained under this act-
And so on. I stress the words "not legally entitled thereto" because if we pass these amendments the dominion statistician, any officials employed by him or any person to whom the dominion statistician chooses to give this information in the line of duty would be legally entitled to it under section 14 of the act we now have under consideration. In other words, under the guise of making this information easier to provide by the companies concerned we are relaxing the secrecy provisions beyond anything intended in the In-

come Tax Act and we are not preserving the confidentiality which in Canada we have always been led to expect would attach to income tax returns.
As I said a moment ago, I do not think we have given sufficient consideration to the effect of clause 14. The provisions of the rest of the bill do not appear to be dangerous or damaging. Alternative ways of making the returns are provided. The requirement with regard to signatories has been altered, and so on. All this is inconsequential. But clause 14 does, I believe, constitute a serious invasion of privacy and a relaxation of the secrecy provisions of the Income Tax Act far beyond what was intended. For these reasons I believe the act should be given further consideration and that we should receive much fuller explanation before it is passed as presented. I know that a number of my friends are prepared to speak on this and that they will give the measure all kinds of consideration. As far as I am concerned, though, I will have to vote against it if the motion comes to a vote.


Mr. Terry Nugent (Edmonton-Strathcona):: This seemingly innocuous measure presented to us by the government is not, in my opinion, nearly as innocuous as it would appear from the remarks of the minister who introduced it. I think the hon. member for Port Arthur (Mr. Fisher) echoed a feeling which must be widespread in the house when he said there had not been sufficient explanation of this desire for change in the method of obtaining information.
The first question which occurs to me is: Do we still want the information which the government desired to acquire when this act was passed in 1962. I should also like to know whether we got that information or not. Has any use been made of it? Was that information of any help to the government in formulating its present policies? I think it is a good idea for us to recall that there was a good deal of debate in the house when this legislation was first considered. Many arguments were advanced to show why this information could not be obtained from ordinary income tax returns. Some of the dangers of such a course were pointed out, and I do not think the government has answered the valid arguments, which at that time were accepted substantially by everyone, in favour of this special method of getting certain information which the government desired to have from these companies.
At that time there was perhaps more immediate concern about the domination of Canadian companies by United States enter-

prises. We were perhaps more urgently aware of balance of payments difficulties. Certain union questions were also more pressing and urgent than they are today. But I would feel much happier if the government would now take a stand and tell us why they want to change this bill which was passed in 1962. Possibly the government will tell us that they are no longer worried about United States domination of Canadian companies. Has the situation changed to such an extent that Canadians are now putting up the degree of finance we should all like to see? Has the percentage of foreign ownership and control of our companies declined to such an extent that this is no longer a question which need make us uneasy?
I do not think any member of this house would deny that the underlying reason for bringing in this legislation was concern over the degree of foreign ownership and control of Canadian companies. There was a feeling among members of the government, shared throughout the country, that the excessive domination of our companies by firms abroad was not healthy for Canada. There had been instances of Canadian companies owned by United States companies showing little enthusiasm for taking up opportunities to export to communist dominated nations. Again, certain Canadian companies in a position to compete in markets overseas were being held up because their parent companies preferred to see United States firms dominating exports to those areas. But today we have not heard one word from the government that this situation has changed in any respect.
No one argues that merely getting this information will cure a situation of the kind I have outlined. But the essence of the reason for passing this act in 1962 was that before these problems could be adequately dealt with and before the public could exercise proper judgment as to the seriousness of the situation, complete information had to be acquired. It was argued, successfully, that in order to acquire this information specific targets had to be set out and specific questions answered so as to provide details which would bear little relation to those given in the income tax returns normally filed by these companies. I think the government owes the house an explanation why this principle has been abandoned. What is this sense of well being, this sense of security, which has brought about a change in the government's attitude? Does the government no longer care whether our companies are under foreign control, or is the situation no longer what it was two
Corporations and Labour Unions Act or three years ago? Is there some dark reason behind this change? Has the government been approached by representatives of foreign dominated companies who say: "This is too embarrassing. If you want our continued good will you must let us off the hook"?
I suggest these proposed amendments do constitute a fundamental change in philosophy. This being so, the government should be prepared to tell us why it has changed its attitude. What has disappeared from the picture? Why is the question of foreign control no longer of interest? I think the government should also tell us something about the way in which this act has worked during the last two years, roughly.
Is it a situation where certain people charged with the statistical compilation of this information, those people who received these returns and were supposed to put them in a form that would be useful to the government and to the public, have failed to put the information in this form? Was there any lack of enthusiasm in some of these departments to compile this sort of information? Has it just been allowed to sit and gather dust, as is usually the case with so much information collected by the government? If it has been adequately handled, and if the respective civil servants in those departments have had put into their hands the type of information that the government thought necessary in 1962, what can the government now tell us with regard to what has been revealed by that information? What does it amount to? What is the position of foreign control and foreign domination now? What are the long term trends in this respect? Is there any substantial increase in investment by Canadian workers and shareholders?
Next, Mr. Speaker, if that information has been correlated and put into the form in which it was envisaged it would be used, what help has it been? Has it had any influence on government thinking? Has it had any influence on the methods this government might be working on to induce Canadians to invest more in Canadian companies? I submit, Mr. Speaker, that these are very simple questions and deserve answers. Certainly the hon. member for Port Arthur revealed the lack of knowledge that lay behind his own bewilderment with regard to this legislation. If we are going to make a change that is so fundamental, with regard to a question decided only two years ago by this whole house, and which was accepted as sensible and necessary at that time, what are the logical reasons for making that change?
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Corporations and Labour Unions Act Surely this is not too much to ask the minister.
I do not want to go over the ground covered by some other hon. members, but I thought the hon. member for Simcoe North (Mr. Smith) had a good point when he asked, why not send it to a committee? That suggestion was echoed by the hon. member for Port Arthur. The Senate thought it necessary. If I am correct in my assertion that this is really a very fundamental change in policy, it might not hurt at all if the banking and commerce committee of this house took a long, searching look at it. Perhaps the explanation the minister would like to give, or the information revealed by those statistics already filed, is so complicated and of such a nature that it is impracticable for the minister to attempt at this time to give us a breakdown which we can examine. Perhaps it has not been refined enough that it can be presented in any simple manner to this house. Certainly if that is the case I think this is the sort of function for which a committee of this house is designed. That is exactly what the committee can do. Present that information to the committee, let them study it, refine it and see whether it has been helpful. I suggest that any change now of what was thought so logical, when there is no evidence presented that it has been unsuccessful or unnecessary, warrants an explanation being given to the house. There has not even been a suggestion by the minister that it is not still needed. The present action is substantiated by no logical argument that I can think of.
Certainly if you are going to test a method and see whether it works, you have to present some evidence if you want to change it. You must show that you have tried it, that you have tested it, and you must put forward some evidence that it does not work. Perhaps the method of collecting the information that was originally envisaged in this act is the best. If it is not, this house, or at least a committee of the house, has a right to look into the matter before we are asked to change that method. We have the right to look at the efforts that were made to compile this information, to assess it, and to look at the results achieved to see what has been accomplished. I suggest to the minister that until that old method-I say "old", although it is only two years old-can by any of these time tested methods be proven to be wrong, he has no logical reason for asking us to change it now.


I listened to the hon. member for Simcoe North and his suggestion that this is an extension of the powers of looking at income tax returns. I think it is more than that. There was a distinction under the old method which will not apply now. This only applied to large corporations with assets of $500,000 or so, which were required to make these special returns. However, Mr. Speaker, unless I have overlooked something, the income tax department will now have the right to look at the returns of all companies.
Since, in the absence of words from the minister to the contrary, we can imagine that the people in the bureau of vital statistics who are going to look at these returns are going to be looking for the same things, I imagine there will be pressure from that bureau on the income tax branch to amend the income tax return form so that it will give more complete information. I do not think this is exaggeration in any sense. It is going to subject more companies, smaller companies, to the searching glance of the statisticians; but it will also cause pressure to be brought to bear on the income tax department to amend their returns in a manner that will satisfy the needs of the bureau of statistics and the government for further information.
My memory may be faulty, but it seems to me these were exactly the arguments we used in 1962-that since the purposes were not the same, and since there was really a very narrow purpose behind the returns required, we would be most unwise to upset the income tax department, their method of reporting and their need for secrecy, by mixing in the special request of the government for special statistics affecting the general health of the nation in regard to the question of foreign domination and control. I for one will be very happy if the minister can show that my memory is very faulty in this regard, or if he can reveal sufficient evidence to show this house that the method of collecting information which we set up only two years ago has fallen down completely, or that the government has fallen down completely in the various departments in making use of this information, or that conditions in the country are such that any information on foreign ownership, control and domination of Canadian companies is no longer of concern. I hope that if the minister's reply on this matter is necessarily a long and involved one, he will take the easy course of sending it to a committee, where we will be prepared to examine it at leisure and with an open mind, hoping to be convinced.


Gordon Harvey Aiken: Mr. Speaker, perhaps I might be permitted to rise on a question of privilege in order to make a correction. This should be done at this point. In my remarks, when referring to the information which might be given by the dominion statistician to "any other person", I took these words from subsection 5 of section 14 of the present act. I overlooked the fact that if the bill is passed this subsection is to be repealed. Therefore, Mr. Speaker, to that extent the assertion that the information could be given out to any other person was incorrect. This does not change my view, but I carried the point a little too far.


Eldon Mattison Woolliams: Mr. Speaker, in speaking to this bill to amend the Corporations and Labour Unions Returns Act I think I can be brief. I was impressed by the last speaker, the hon. member for Edmonton-Strathcona (Mr. Nugent) and also by the hon. member for Port Arthur (Mr. Fisher) both of whom suggested that this bill be referred to the standing committee on banking and commerce, a committee of parliament. Perhaps the question being asked by most speakers is, why the amendment at all? I do not think the minister has clarified why there should be an amendment. It is obvious that the minister does not want one: It is the officials-I have always felt this- who are behind the minister, whether he be a Conservative minister or a Liberal minister, who are not satisfied with the material they are getting either from labour unions or corporations. Therefore they want the act amended so they can get this information they are looking for.
The second point which impresses me, a point referred to by one of the speakers, is that when we open up the gate to a department, in this case the Department of National Revenue, we are opening up a new field of law-and a very dangerous field of law, when we go into income tax returns. Because the minister has not explained to the house why he requires this particular fork to be put into the act to dig up the proper information, and because he has not explained why he needs to go into a new field and enable another department to go into income tax returns-which is, I suggest, a very dangerous trend, the end of which we will never know -I am myself unhappy about this bill.
All who have spoken so far have agreed that in order to find out who has control of our labour unions or corporations this information should be provided; there is no argument
Corporations and Labour Unions Act there. I need only refer to what was said by the hon. member for Port Arthur regarding the S.I.U.; we know the kind of control which was held in that case. I suppose I could also name corporations on the other side of the fence which would be just as interesting factually as was the S.I.U. Therefore I am going to move-and I said I would be short- on those two counts, and because I have been impressed by what these hon. members have said, seconded by the hon. member for Parry Sound-Muskoka (Mr. Aiken):
That the bill be not now read a second time but that the contents thereof be referred to the standing committee on banking and commerce.


Allan Joseph MacEachen: Mr. Speaker, I wish to raise a point of order on this amendment. I understand that on second reading of a bill it is inadmissible to move that a bill itself go to a standing committee. The wording of the amendment obviously means that it is the bill itself that is to be sent to the committee because it refers to the "contents" of the bill. The standard form for moving such an amendment is to refer the subject matter, which is entirely different. I suggest that this amendment is not in order.


Mr. Deputy Speaker:: Do other hon. members wish to speak to the point of order raised by the Minister of Labour?


Gordon Harvey Aiken: I have just one point, Mr. Speaker. I think this is the form in which a good many private members' bills have been sent to committee during private members' hours. Unless there is a difference in the form of the amendment it is certainly the same intent, and this form has been used many times in this session.


Mr. Deputy Speaker:: If there are no other contributions to the discussion on the point of order, may I say I appreciate the point raised by the Minister of Labour (Mr. MacEachen). He states that referring the contents of a bill to a committee is different from referring the subject matter of a bill to a committee. This, to my mind, is perhaps technical more than anything else. Perhaps the hon. member who put the motion might be allowed by the house to amend the wording of his amendment so as to read:
That this bill be not now read a second time but that the subject matter thereof be referred to the standing committee on banking and commerce.
Is that agreed?


Some hon. Members:: Agreed.


Mitchell William Sharp: Mr. Speaker, may I speak to
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Corporations and Labour Unions Act this motion and in the course of my remarks answer some of the questions raised on the bill, which might induce the house to permit it to receive second reading. As was said by the hon. member for Port Arthur (Mr. Fisher), this bill was introduced with considerable fanfare by the previous government. The hon. member quoted from the speech of the former minister of justice, the Hon. Davie Fulton, in which some, what I now consider rather extravagant claims were made about what might be accomplished pursuant to this legislation. However, to answer the questions raised by the hon. member and by a number of other hon. members it is my view that this is very useful legislation. I think that what was claimed for it was extravagant, but I feel it would still be useful to continue to have the act on the statute books and to continue to gather the information authorized by the act. In any event, the claims which were made must have been extravagant because one can do very little with the information itself. If we are going to deal with the substance of this matter we must do so by policy rather than by the gathering of information.
May I now say that I did not give a report on what had happened under this bill, and the reason is very simple and really relates to the purpose of the amendments. We had very great difficulty in gathering this information for the year 1962. There was unfamiliarity with the act itself, which is understandable, and it took-


Eldon Mattison Woolliams: I wonder whether the minister would mind a question at this point. I do not say this in any critical way, but I was advised by lawyers in the city of Calgary that the forms for the gathering of this information never reached the corporations. When they applied to the various offices to obtain the forms, they were not ready or prepared and the corporations could not fill them out. I wrote to the minister's department, or to one department about this, but that was one of the main reasons why that information was not forthcoming.


Mitchell William Sharp: Mr. Speaker, all I can say in reply to that is that I was asked during the last session of parliament whether all the corporations had at that time made out the returns they were required to make. I said that they had been asked to make a return for which the forms were submitted, but that at that time quite a number of corporations were in arrears. It may be that at the beginning the forms were not available as quickly


as they might have been, and I think that is understandable. This act was a new act, and so on. But in the end when the forms were available there was considerable difficulty in getting them completed. However I am happy to say that we now have all the returns in for the fiscal year ending in 1962, which was the first report required by the act. In addition, most returns have been received from corporations and unions for the fiscal period ending 1963, and many have been received for the period ending 1964, so we are making progress. The statistical material received from corporations and labour unions is currently being processed and it is expected that the first report under this legislation will be available for parliament before the end of the current calendar year.
The first report will provide information concerning the extent of non-resident ownership in Canadian companies in respect of assets, equity, sales and profits, and in addition the magnitude and detail of payments to non-residents by corporations in Canada for business services, and to international headquarters of unions operating in Canada in respect of dues and assessment on Canadian members will be made available.
The reason I could not give a report on what had happened under the act was simply that we are in the process of tabulating and analysing the first returns. Otherwise I would have been in a position to say, this is what we have learned as a result of the operation of the act.
I come now to the point about confidentiality of information. The first question asked of me by the hon. member Edmonton West (Mr. Lambert) related to the similarity that exists between information required during this act and information required under the Income Tax Act. During the supper hour I obtained from my officials a copy of the corporation income tax return, and I asked them to indicate on that return the items which we now asked for and obtained under the act, to which I shall refer in short form as COLUR, because that is what it is known as around the bureau of statistics. It is the corporations and labour unions return. The dominion statistician now obtains the same information as is tabled on the corporation income tax return in respect of any foreign items of allocation of taxable income to provinces or other jurisdictions in which permanent establishments were maintained, calculation of federal taxes payable, and calculation of provincial taxes payable' information on continuity of all reserves in-

eluding provisions for doubtful debts, charitable donations, interest, rents, royalties and other similar things, including provincial taxes. That information is not strictly required for the purpose of the act that is now under discussion, but we do obtain all the information about the income of the corporation and its reconciliation of net income with all the accompanying financial statements. In fact, we obtain all the vital information now about the financial positions of every corporation that has to report under this act.


Eldon Mattison Woolliams: May I ask the minister a simple question? I put this to the hon. minister. If that is correct, why do you still want to amend the act? You must want to do so because you are not getting the proper information or because you do not want to have a duplication of information going to two different departments.


Mitchell William Sharp: I think the hon. member has finally seen the point. As I said in my opening statement, many corporations suggested to us when we asked for information under this act that they had already filed the information with the Department of National Revenue, and wanted to know why we needed the information again.
In answer to a question put to me at the end of my opening statement I did say that no corporation had specifically said it would like the dominion statistician to have access to the income tax returns, but on checking with my officials I am told that while that was not true, many of the corporations had indicated by implication that they would like that to happen because they had already filed this information and did not want to have to file it again.
I should like to make this point quite clear. Under this act in respect of corporations that have filed returns, the dominion statistician now obtains all the essential information available in the income tax return. That information is required by an act that was approved by this house a couple of years ago. There is nothing new in this legislation. The whole purpose of the amendments is to simplify the administration, and that only.
There is one other point I am surprised some hon. members have not emphasized to a greater degree, and that is that the information now obtained under this act is available to anyone in government. However, when this amendment is approved the distribution of that information will be restricted. It is now available to the dominion
Corporations and Labour Unions Act statistician only for the purpose of analysis. That is the main point of this legislation; that is the purpose and that is what happens.


Marcel Joseph Aimé Lambert: What about all the other thousands of corporations not now required to report under COLURA, as you wish to call it, but whose records will now be examined as a result of this proposed amendment?


Mitchell William Sharp: That is a point, Mr. Speaker; but the penalties for disclosure of any information of that kind are just as serious if the disclosure is made by the dominion statistician or his employees as they would be if the disclosure was made by the Department of National Revenue. At the present time the dominion statistician obtains this information from the larger corporations, and he and his employees are under threat of penalty if they reveal any of that information. This legislation does enable him to get other information at the same time he obtains the information in respect of these specific corporations, so that his statistical analysis is somewhat more complete, but there is no right on the part of the dominion statistician to reveal that information to anyone, not even to someone in government service outside the bureau of statistics.


Douglas Mason Fisher: I should like to ask the minister one question, Mr. Speaker. When the minister was speaking to the Couchichirjg conference by radio he emphasized the point that it was very difficult for anyone, including members of parliament, particularly members of the opposition, to be in touch with this information, but I assume the dominion statistician is going to be in possession of this information which is covered under clause 4, subclause (b), and that it is going to be available to the government. Is that not true?


Mitchell William Sharp: That information is not going to be available except in analysis form. It is not going to a be availaible to people in the government. They will not be able to look at particular returns of particular corporations.


Douglas Mason Fisher: Mr. Speaker, I do not wish to go into detail, but the present subsection says:
Any official or authorized person may. for any purpose relating to the determination of policy in connection with the formulation of any law of Canada or the ascertainment of any matter necessarily incidental thereto,
(a) communicate or allow to be communicated-
I do not see anything in the amendment that substantially changes that right.
The other point I wished to touch upon in relation to this legislation relates to the indi-
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Corporations and Labour Unions Act cation given by the minister about this statistical information. I should like to know whether as a result of the changes in practice this legislation will cover those companies that are now exempted by this schedule. The minister knows that the schedule exempts small loan companies. What will happen in respect of Household Finance Corporation, and I could name several others? I assume that if the idea is to ascertain trends, it is important that all corporations be included, and that has not been clearly stated by the minister. I assume that if the dominion statistician has access to the files he is going to go into the records filed with the Department of National Revenue, and they embrace all corporations, wiping out the previous exemptions covered by the schedule.


Mitchell William Sharp: Mr. Speaker, may I first correct the hon. member, as the hon. member for Parry Sound-Muskoka corrected himself. Under clause 3 the amending bill removes subsection 5 of section 14 which the hon. member has just read.


Douglas Mason Fisher: Then why bother to have the act?


Mitchell William Sharp: The purpose of the act is to obtain information about the extent of foreign ownership and its importance, and this is fully maintained by these amendments. Indeed, the first part of the act which is not amended at all, section A returns which are set our more particularly if you will look at the act, is not altered in any respect except for some filing dates. With regard to part B or section B, returns which relate to financial information, the only change is that the information is now obtained from income tax returns as far as corporations are concerned. That is the only change, except to restrict the access of government officials to the individual returns. That is why I made so little of this bill. It is a very simple amendment designed only to simplify administration.


Gordon Harvey Aiken: I wonder whether I might ask the minister a question along the same lines. Has the minister information as to how large a percentage of the corporations which file income tax returns are required to file the special return? I think this is the essence of the question also raised by the hon. member for Port Arthur. How many additional corporations are brought under the operation of this act?


Mitchell William Sharp: Mr. Speaker, if we do go into committee of the whole I will have my 

officials in front of me and these questions can be answered there or in any other committee.


Eldon Mattison Woolliams: I do not want to interrupt the minister but I should like him to answer one other question. If we were to withdraw our amendment this might expedite the matter and save the bill-we are not trying to block it-and in that event would the minister undertake to send the bill to a committee so that witnesses can be called and so that the information members have asked for can be supplied and the questions they have raised can be answered in the standing committee? If he would agree to do that I think the mover and seconder of the amendment would agree to withdraw it, because if we could get the bill before a committee we would be satisfied.


Mitchell William Sharp: I would be very happy to do that. I had thought that perhaps it would have served the purposes of the house better if that examination had taken place with the first report under this act available. But if hon. members feel they would like to examine these amendments more carefully and to have witnesses called I would certainly have no objection. I would be very happy to comply with the hon. gentleman's suggestion, and instead of going into committee of the whole move that we should refer the bill to the standing committee on banking and commerce.


Gordon Harvey Aiken: Mr. Speaker, as the seconder of the amendment I am prepared to withdraw it but I still cannot change my position on the bill. I will have to vote against it. I should like this understood.


Terence James (Terry) Nugent: Mr. Speaker, I was about to ask the minister a question but if we are speaking to the amendment I should like to say something. However, in view of the interventions by hon. members I am not sure if the minister still has the floor.


Mr. Deputy Speaker:: Order. I believe the minister has concluded his remarks and my understanding is that the hon. member for Edmonton-Strathcona is now speaking to the amendment.


Terence James (Terry) Nugent: Then instead of just asking a question-


Guy Favreau: On a point of order, Mr. Speaker, I understand that the hon. member for Bow River is asking for leave to withdraw his amendment and I wonder whether

you would ask if he has the consent of the house.


Mr. Deputy Speaker:: Has the hon. member for Bow River unanimous consent of the house to withdraw his amendment?


Eldon Mattison Woolliams: Before that is put I want to make sure I understood the minister correctly. My understanding is that the bill will go to the standing committee on banking and commerce.


Mitchell William Sharp: I have no objection at all and I will be happy to so move.


Guy Favreau: After second reading.


Mr. Deputy Speaker:: Has the hon. member for Bow River unanimous consent of the house to withdraw the amendment?


Some hon. Members:: Agreed.
Amendment (Mr. Woolliams) withdrawn.


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


Gordon Harvey Aiken: I want it recorded as being on division.


Mr. Deputy Speaker:: On division.


[Stage Direction]
Motion agreed to, bill read the second time on division and referred to the standing committee on banking and commerce.


Guy Favreau: the second reading of Bill No. C-121, to provide for the extension of credit to farm machinery syndicates.


Mr. H. W. Danforih (Kent, Ont.):: Mr. Speaker, with regard to the introduction of this bill-does the parliamentary secretary wish to speak at this time?


Mr. Deputy Speaker:: The parliamentary secretary to the Minister of Agriculture.


Mr. B. S. Beer (Parliamentary Secretary to Minister of Agriculture):: Mr. Speaker, in the absence of the minister, who is out of the country on government business, I wish to make a statement on second reading of this bill. The minister appreciated the constructive criticism and remarks of members of the house, the concern they expressed with regard to the bill and the interest they have taken in it. I ask the indulgence of the house to permit me to stick to my script because
Farm Machinery
I wish to be rather precise, since I am speaking for the minister.
A number of questions were asked concerning the proposals which would be contained in the bill and how this proposed credit program would operate. An examination of the bill itself will provide the answer to most of these questions.
The government has been concerned, and hon. members have indicated their concern, about the cost to Canadian farmers of owning and operating farm machinery. As an indication of the size of this problem I should like to point out that at the time of the 1961 census the value of farm machinery on farms in Canada amounted to more than $2J billion. During 1963 the cost to Canadian farmers for owning and operating their machinery amounted to about $541 million and more than half of these costs were represented by the cost of ownership, including depreciation and interest on investment. When we consider ways of increasing the farmer's income I am sure we are all thinking of his net income. Anything which we can do to reduce the farmer's operating costs is in effect a move to improve his income.
As the minister indicated in his remarks at the resolution stage, the co-operative use of farm machinery is already practised among Canadian farmers by sharing in the ownership of individual machines or by having work done on a custom basis.
Two factors have made more extensive cooperative use of machinery difficult. The first has been the need for the determination and establishment of a simple and workable basis for the organization of co-operative groups of farmers. The second has been the lack of adequate credit facilities to enable such groups to operate. The purpose of this bill is to assist in overcoming these two problems and, in this manner, to encourage joint ownership by groups of farmers of these types of machinery and equipment, the use of which may be shared in order to reduce the overhead costs of each farmer.
For this reason, the bill proposes to set up what has been termed syndicates. The syndicates in effect will be groups of three or more persons engaged in farming who have entered into a form of partnership agreement with one another to undertake the joint purchase and use of farm machinery. The bill is designed to assist those whose principal occupation is farming. However, because of location and other factors, it may be very much to the advantage of some full-time farmers to include in their syndicate neigh-

Farm Machinery
hours who are farming but also engaged in other pursuits. The bill provides for this kind of co-operation, but to assure that full time farmers are the chief beneficiaries at least the majority of members of any syndicate must be persons whose main occupation is farming.
There has been some question of the choice of the word "syndicate" to identify these groups. A syndicate by definition means a combination of persons formed for the promotion of an enterprise. There are, of course, other terms which might have been used, and in fact were considered. Some speakers have suggested the word "co-operative". This word was considered, but there is now legislation in practically every province for the formal incorporation of co-operatives, and we did not think it wise to use a term which might seem to conflict with provincial jurisdiction.
The word "syndicate" is an appropriate one to define a combination of persons formed to promote an enterprise or for the acquisition of articles. In fact the use of the word "syndicates" for this purpose is by no means new in Canada. In the early days of the west the term "syndicate" was widely used to describe groups of farmers who joined together for the purchase of machinery.
Several members pointed out, quite properly, that some items of farm machinery lend themselves to joint ownership and use, but there are other items which a farmer has to own himself if he is to be sure of having them available when he needs them most.
There will be authority in the bill to define farm machinery by regulation. We thought it best to do it in this way because we are entering into a completely new venture in which we will have to profit by experience, and in which some changes may be required as we gain experience. The intention, however, would be to define farm machinery very broadly, so that the bill might apply to any item of machinery which a farmer might use in the development or operation of his farm, and leave it to the groups as they are organized to decide the items which they feel could profitably be owned and used jointly.
The bill proposes loans up to 80 per cent of the cost to the syndicate of the machinery which they buy. The remaining 20 per cent of the cost, spread between the various members of the syndicate, will allow individuals to become members with a relatively small initial contribution. The maximum amount

of loans to any one syndicate would be $15,000 per member, but not to exceed $100,000. These amounts should be sufficient to allow syndicates to share in the purchase of a considerable amount of equipment, including those specialized items of high capital cost which are available for use but which are too expensive for farmers to purchase on an individual basis.
The initial organization of the syndicates is most important for their future success. Farmers wishing to organize to take advantage of the provisions of this bill will require some assistance and guidance in their initial planning. The minister is proposing that the responsibility for the administration of the measure be assigned to the Farm Credit Corporation so that we may make use of the facilities which they have already established across the county and the experience they have gained in administering farm credit.
It is proposed also to make the program self-supporting. One of the principal items of cost will be the initial establishing of the syndicate, the study of its proposal, and the approval of the loan. This is provided for by a service charge of 1 per cent of the amount of the loan. The cost of administering the loan, once it is made, will be provided for in the interest rates which will be fixed from time to time by the corporation with the approval of the governor in council.
Mr. Speaker, there is quite a bit of chattering in the house. I had hoped that this bill would commend itself to the members sufficiently that they may wish to listen to the statement.
In this connection, I should like to point out that since these loans will be for terms not exceeding seven years, the cost of the money to the corporation will be less than the cost of money it borrows for the making of long term loans under the Farm Credit Act. I am informed that within recent years the cost of money borrowed for periods of less than ten years has been about half of 1 per cent less than the cost of money borrowed for periods of up to 20 years.
Since this is a new type of program there will undoubtedly be problems to overcome in its initial operation. The hon. member for Qu'Appelle (Mr. Hamilton) has mentioned in particular the difficulties which may arise when several farmers endeavour to share the use of one particular machine. In drafting the provisions of the bill, and planning for its administration, consideration has been given

to the ways in which these problems can be lessened.
The first essential factor, of course, is the compatibility of the members one with another, and since syndicates will be formed on the initiative of individual farmers who choose their own partners to participate with them I have no doubt that farmers will find partners with whom they can work amicably. Further, in the setting up of the syndicate there will be predetermined arrangements designed to settle in advance some of the problems which may later arise. There will first be some general provisions applicable to all syndicates, including such items as provisions for adding members, for reduction in membership, for the procedure in the event of death or insolvency of a member, and for the voluntary dissolution of the syndicate. There will also be provisions for such items as the appointment of a secretary, the maintenance of proper books of account, and so on.
Farmers forming syndicates will also be required to make arrangements in advance concerning their individual shares and responsibilities with respect to payment of capital maintenance and operating costs, and the responsibilities for operation, repair, maintenance and storage of the machines. They will need to agree concerning the priority of the right to use the machine in the event that two members wish to use it at the same time. By agreeing on this type of thing in advance many of the difficulties of co-operative use will be overcome.
It is appreciated that the provisions of this bill do not apply equally well to all types of machinery and equipment. Syndicates formed to purchase harvesting equipment, for example, where the time at which the farmer has the machine available is of vital importance, will probably contain a relatively limited number of members. It will be important to ensure when the syndicate is being formed that the machinery being purchased has ample capacity to meet the requirements of all the members within the season of use. However, in dealing with such machinery as that used for land clearing, land levelling, drainage, etc., it may be possible to form syndicates with larger numbers of farmers because the time of use of the equipment is not such a vital factor.
I might point out also that a farmer who obtains assistance under this bill would still retain his eligibility for loans under the Farm Improvement Loans Act for equipment he wishes to purchase on his own, as well as for livestock, building improvements, etc.
Farm Machinery
Hon. members may wish to have some information with respect to this type of operation elsewhere. Syndicates of the type proposed in this bill were started as a pilot project in the United Kingdom in 1955 and developed slowly during the first few years. By 1962, 293 syndicates had been formed. However, as a result of the program's successful operations it has expanded rapidly since that time. In 1963 there were 341 syndicates and by August of this year, 596 syndicates had been formed. Farmers who are members of syndicates who were interviewed concerning their operations indicate that disagreements among syndicate members are rare. They indicated, for example, that the problem of three small farmers deciding upon the order in which a machine should be used by each was not very different from that of a large farmer deciding upon the order in which he would use a machine in his own fields, and the problem was usually resolved after consideration of the same factors as those which influence the decision of the larger farmer. It is interesting to note, also, that some of these syndicates have found it advantageous to share their labour resources as well as their machinery.
It has been suggested that this legislation will be of more value to large operators. On the contrary I believe the advantages of cooperative use are far more significant to the small operator. It may be a perfectly economic proposition for a large farmer to own equipment large and efficient enough to do all his work, while such a proposal might be beyond the means of the small farmer. The opportunity provided to a syndicate to acquire machinery, with an initial payment of 20 per cent of the cost spread among three, four or five members will make it possible for small farmers with limited capital resources to share in the ownership of efficient machinery for operating their land with low individual investment and overhead.
As I have already indicated, this bill is a new departure to meet a new and expanding need for credit and co-operation among farmers. It is designed to assist them to reduce their machinery costs. It proposes a fund of $25 million to meet the initial demand. I have no doubt that after the act is in full operation experience will indicate some changes and modifications and perhaps the need for a larger fund. In this event, amendments will be introduced to make such improvements. But I believe we have in this present bill all the fundamentals of a practical program which will offer very real assistance to Canadian
8282	HOUSE OF
Business of the House
farmers in controlling an important part of their costs and increasing their efficiency. I believe that farmers themselves will quickly recognize the advantages of this program.



BUSINESS OF THE HOUSE

Mr. Flemming (Vicloria-Carlelon):: May I
ask the leader of the house what will be the business tomorrow?


Guy Favreau: We shall first carry on with the debate on second reading of Bill No. C-121 to provide for the extension of credit to farm machinery syndicates. When we are through

with the committee stage, we shall proceed with item No. 49 on the order paper and continue the debate on the resolution stage of the bill to amend the Crop Insurance Act. That will be followed by item No. 7 on the order paper, the resolution preceding the measure to amend the Merchant Seamen Compensation Act. This will be followed by the continuation of the committee stage of Bill No. C-72 to provide for the establishment of electoral boundaries commissions.


[Stage Direction]
It being eight minutes after ten o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Tuesday, September 22, 1984