1964-03-24

Mr. Speaker:: I have the honour to inform the house that I have received a communication notifying me that a vacancy has occurred in the representation, namely of Hon. John Richard Garland, member for the electoral district of Nipissing, by decease.
Accordingly I have addressed my warrant to the chief electoral officer for the issue of a new writ of election for the said electoral district.



CONSUMER CREDIT


Mr. J. E. Walker (York Centre) moved:: That the members of the House of Commons on the joint committee of the Senate and House of Commons to inquire into and report upon the problem of consumer credit, approved March 9, 1964, be composed of: Messrs. Bell, Cashin, Chretien, Clancy, Coates, Cote (Longueuil), Crossman, Deachman, Drouin, Greene, Gregoire, Hales, Miss Jewett, Macdonald, Mandziuk, Marcoux, Matte, McCutcheon, Nasserden, Orlikow, Pennell, Ryan, Scott and Vincent.


[Stage Direction]
Motion agreed to.


Mr. Reid Scott (Danforth) moved: for leave to introduce Bill No. C-82, to amend the Criminal Code (human rights and fundamental freedoms preserved).


Some hon. Members:: Explain.


Reid Scott: Mr. Speaker, the purpose of this bill is to create an offence under the Criminal Code whereby, should any persons do any acts which contravene the provisions of the bill of rights, they would be subject to prosecution under the Criminal Code and liable to a sentence of up to 14 years. It is my hope that if we enact this bill the disgraceful events of last week in my own province of Ontario will never be repeated.
Motion agreed to and bill read the first time.



CANADIAN BROADCASTING CORPORATION


[Stage Direction]
On the orders of the day:
Right Hon. J. G. Diefenbaker (Leader of the Opposition):: Mr. Speaker, I would direct a question to the Secretary of State in connection with the matter I raised yesterday in endeavouring to have the house adjourned, namely the showing of a film, a preparation of the C.B.C. entitled "The Open Grave". My understanding is that consideration was given to whether or not it should in fact be shown, regard being had to the tremendous revulsion of feeling across the country. Is the minister in a position to advise what is the state of affairs?


Hon. Maurice Lamonlagne (Secretary of State):: Mr. Speaker, I will be glad to try to answer this question and some others asked yesterday about this matter. As I undertook yesterday in the house, I communicated to the president of the C.B.C. the various views expressed to me by hon. members inside or outside the house. I also told Mr. Ouimet that in so far as I was concerned the decision whether or not the program should be shown was to be made exclusively by the C.B.C., and that I would not exercise any pressure to affect the independent judgment of the management of the corporation.
After consultation with his advisers, Mr. Ouimet communicated with me again a few moments ago to inform me that the management of the C.B.C. had decided to go on with the program as scheduled.
I should like at this stage to recall what the hon. member for Digby-Annapolis-Kings had to say in 1962 on this general matter-


Some hon. Members:: Oh, oh.


Mr. Pigeon:: It was not about the same case.


Maurice Lamontagne: -when he was the minister responsible for the C.B.C. This is what he said, as reported on page 857 of Hansard:
-it has been the policy of this government from the beginning, as it was the policy of the previous government and as I hope it will always be the policy of federal governments, not to interfere with the programming of the C.B.C.
1396	HOUSE OF
Inquiries of the Ministry
The hon. gentleman went on to say:
-if we were to start interfering with the programming of the C.B.C. we would be laying the foundation for either a fascist state or a communist state.


John George Diefenbaker: Mr. Speaker, did the hon. gentleman communicate that information to the Minister without Portfolio in his own cabinet, who gave his views on this subject the other day?


Mr. R. N. Thompson (Red Deer):: Mr. Speaker, my question is directed to the Prime Minister. Is it the intention of the government to take the lead in setting up a special parliamentary committee so that matters relating to the Canadian Broadcasting Corporation and the over-all related welfare of the nation can be properly discussed instead of having them brought up on orders of the day in a piecemeal fashion, as has been the case in connection with the program "The Open Grave"?


Right Hon. L. B. Pearson (Prime Minister):: Mr. Speaker, the question of setting up a committee in some form or other to examine such aspects of the work of the C.B.C. is now under active consideration, and I hope an announcement will be possible very shortly.



LABOUR RELATIONS


[Stage Direction]
On the orders of the day:
Hon. Michael Starr (Ontario):: Mr. Speaker, may I direct a question to the Minister of Labour. Will the minister advise what specific action the United States government and/or the United States department of labour promised the Canadian government they would take to end harassment of Canadian ships in the United States ports when the shipping season commences?


Hon. A. J. MacEachen (Minister of Labour):: Mr. Speaker, I have not been in touch with the United States secretary of labour or the United States labour department in recent days or weeks on this particular subject.


Michael Starr: As a supplementary question, will the minister contact these people in order to get some specific promise, in view of the fact that the shipping season will be starting in another two or three weeks?


Allan Joseph MacEachen: Mr. Speaker, the views of the government have frequently been discussed with the secretary of labour and the labour department of the United States. They realize how necessary co-operation is in controlling the situation on the American docks, and I am sure that within United States law that co-operation will be forthcoming.


Michael Starr: As a further supplementary question, did the United States government at any time make any specific promise on its part to end the harassment of Canadian ships in United States ports on the great lakes?


Allan Joseph MacEachen: I do not understand what is meant by a specific promise. I do know that the United States authorities have assured us of co-operation, and during the last shipping season they indicated their willingness to carry out that co-operation by certain actions taken by the national labour relations board and the department of justice in the courts in Chicago.


Michael Starr: Does the minister feel that whatever action has been taken and this co-operative effort are things that are worth while and that will end the situation?


Allan Joseph MacEachen: Mr. Speaker, as the hon. gentleman knows, this harassment has been of long standing character, and prevailed during his term as minister of labour. It is a problem that is related to interunion activities of the two countries and interunion activities in the United States. Within the limits of United States law I am quite convinced that co-operation will be forthcoming.


Mr. L. P. Antoine Belanger (Charlevoix):: Mr. Speaker, I should like to put a question to the Minister of Labour.
Has the minister received or not a formal assurance from representatives of the U.S. government that the United States will take action to prevent the boycotting of Canadian ships on the great lakes and in American ports following the dismissal of Hal Banks?


Mr. Speaker:: Order. It seems to me that this question was asked yesterday; or if not then, the day before.


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
Mr. T. C. Douglas (Burnaby-Coquitlam):: Mr. Speaker, may I ask the Prime Minister whether he has any report to make regarding the appointment of a mediator in Cyprus, and can he say under what terms of reference the mediator has been appointed? May I also ask the Prime Minister whether he has seen the press report which was carried on the C.B.C. news last night, to the effect that a group of 120 Canadians on a familiarization tour of Cyprus was prevented from entering the town of Limassol by a British

major, who advised the Canadians that the townspeople might think they had arrived in an operational role and would then be disappointed when they left, thus destroying the United Nations peace force image?
I would also like to ask the Prime Minister if this is a breakdown in communications and liaison; and since when has a major in the British army been given the authority to interpret the role of the United Nations force in Cyprus?


Lester Bowles Pearson: On the last point, Mr. Speaker, I would not interpret the reported incident in that way, but when I saw the report of the incident I made inquiries and I am awaiting a report from our people on the spot.
So far as the appointment of a mediator is concerned, it is expected that that appointment will be confirmed within a few hours, if it has not already been formally confirmed. The mediator is a very distinguished representative of Finland who has been minister of trade and commerce, minister of finance and prime minister of that country. In addition he has been the ambassador of Finland in London and has already done important service to the United Nations in Laos. He seems to be eminently qualified for this very difficult and important function, and I understand he will be taking up that function very shortly.
Last evening the Secretary of State for External Affairs discussed the problems regarding the formal authority for the force with the commander of the force, General Gyani, who is in Geneva and who is on his way to Cyprus, if he has not already reached there. It is expected that an announcement will be made regarding this matter very, very shortly.


Thomas Clement (Tommy) Douglas: Mr. Speaker, I agree with the Prime Minister's statement about the excellent qualifications of the mediator who is likely to be appointed, but can the Prime Minister tell us whether we will be able to secure the terms of reference within which he will operate in seeking to bring the parties together?


Lester Bowles Pearson: Yes, Mr. Speaker. I hope to be in a position to make those terms known to the house before we adjourn.


[Stage Direction]
On the orders of the day:
John George Diefenbaker: Mr. Speaker, this is a matter of some urgency to the Jewish communities across our country, and I therefore direct the question to the right hon. Prime Minister. These people are justly aroused over the
Inquiries of the Ministry denial by the U.S.S.R. of the importation of sacramental Passover bread; I think the proper name for it is matzoth. Has the government communicated with the ambassador to the U.S.S.R. to point out the feeling of Canadians that this is most unfair and is in contravention of the charter of the United Nations, which assures freedom of religion?


Lester Bowles Pearson: Mr. Speaker, I was as disturbed as is the right hon. gentleman to hear that it may be difficult again this year for the Jews of the Soviet union to receive unleavened bread for the feast of the Passover. I know how important it is for members of the Jewish faith to have especially prepared bread for this religious festival.
I do not have at my disposal all the facts, nor do I know the situation inside the Soviet union regarding this particular matter, but we are making inquiries. It is not entirely clear whether the Soviet authorities intend to stop gifts of matzoth from abroad. However, we have cabled our ambassador in Moscow asking him to make inquiries, as I have indicated, and to let the Soviet authorities know that this is a matter of great concern to the Jews of Canada and to broad sections of the Canadian public. I appreciate that the holiday season starts at the end of this week and it is therefore a matter of urgency whether anything can be done to improve what appears to be an unhappy situation.


John George Diefenbaker: Mr. Speaker, the information I have-and I am sure the Prime Minister has this too-is that the Soviet authorities are refusing to allow such gifts this year. I believe in one case they refused a shipment from the chief rabbi in London, England. They refused to allow it to land, or announced in advance that it would not be allowed to land. As soon as the Prime Minister has some information on this matter, will he let the house know?


Lester Bowles Pearson: Yes, Mr. Speaker. That is what the ambassador has been instructed to look into.


[Stage Direction]
On the orders of the day:
Mr. Real  Caouslie@Villeneuve: Mr. Speaker, may I direct a question to the Minister of Justice?
Has the minister received representations from individuals, industrial corporations or any province about Quebec's decision to control lumber exports to any Canadian province and, if so, what action does he intend to take?

Inquiries of the Ministry Hon. Guy Favreau (Minister of Justice): Mr. Speaker, I may tell the hon. member that I am having that matter investigated and that I hope to be able to give him an answer before the adjournment of this session.



AUTOMOBILE PARTS


[Stage Direction]
On the orders of the day:
Hon. Mitchell Sharp (Minister of Trade and Commerce):: Mr. Speaker, yesterday the hon. member for Burnaby-Coquitlam asked me three questions relating to the export of automobile parts to China, and I should like to answer them seriatim.
First, he asked if I had received any complaints from Canadian exporters with regard to the refusal of automobile companies in Canada which are subsidiaries of United States automobile manufacturers to supply automotive parts for export to China. As I said yesterday, I was unaware of any complaints but I found that last summer I had received a complaint from one Canadian exporter, whose name I believe was Mr. Grinkus of Gain Import Company Limited, who was unable to obtain a supply of certain types of automotive parts for export to mainland China, stating that the difficulties experienced were attributable to a refusal of subsidiaries in Canada of United States automobile manufacturers to supply parts for export to China.
The second question asked whether this refusal is based upon the declared policy of the United States government. In reply to that I would only say that no information is available on this matter other than that provided at the time by that exporter. Accordingly I have some difficulty in answering the question whether there has been such a refusal on the part of the automobile manufacturers in question and, if so, what their reason may have been.
His third question asked if so, does the minister consider this action to be a violation of Canada's right to exercise control over its own economy? If the parts concerned had been of United States origin, of course no Canadian export permit would have been given for their re-export to mainland China. This is the policy of the Canadian government, and I do not think in any sense it is a violation of Canada's right to control its own economy. This is the exercise of its own right. If the parts were of Canadian origin it is possible, although I have no information other than that provided by the exporter himself, that they might have been available from sources in the market other than the manufacturers which are subsidiaries of United States companies. However, [Mr. Caouette.l
one of the difficulties in answering this question is that we have no information on this other than the word of the exporter himself.
May I add this, Mr. Speaker. As the hon. member may be aware, arrangements were agreed to some years ago between the United States and Canadian governments for consideration to be given by the United States government to an application for a foreign assets control licence by a United States parent company arising out of a transaction which might have been consummated in Canada. In recent years there has been no request from a Canadian automobile manufacturer for our intercession in support of a parent company's application for an F.A.C. licence, and accordingly it may be that the companies have other reasons if they have refused to supply the exporter in question.


Thomas Clement (Tommy) Douglas: Mr. Speaker, may I ask the minister whether he would have his department get in touch with the Canadian automobile manufacturers, particularly Ford, General Motors and Chrysler, to see if it is their stated policy to refuse to sell parts to exporters who are exporting outside the commonwealth. Is this part of their stated policy and, if so, what is the reason for such a policy?


Mitchell William Sharp: Mr. Speaker, I might make inquiries about that, but I would rather have, in order to make a proper inquiry, an order which is to be filled. Because if I contact them and ask them what their policy is they will say, what is the order for? I do not believe it would be in the public interest to give such general answers. I think they only confuse the issue, but if the hon. member has an order that has been refused I shall be happy to investigate.


Thomas Clement (Tommy) Douglas: But the minister received a letter from Mr. Grinkus to which he referred, dated June 27, 1963, stating he had an order for crankshafts and other parts of trucks and cars for export, but it was refused by the United States parent companies of Canadian subsidiaries.


Mitchell William Sharp: My understanding, although I hesitate to speak from memory now, is that the automobile companies did not have actual orders to fill. They were inquiries.


Mr. Stuart A. Fleming (Okanagan-Revel-stoke):: As a supplementary question, are there any Canadian government restrictions on the export sale to mainland China of farm machinery manufactured in Canada but which may include some United States components?


Mitchell William Sharp: I think this question, Mr. Speaker, should be put on the order paper, perhaps with the specific indication of the

article in question, because it does depend on the degree of United States participation in the manufacture.


Stuart A. Fleming: I rise on a question of privilege, Mr. Speaker. This question was on the order paper. It was purported to have been answered yesterday, but the answer was so narrow in its interpretation and so restrictive that it contains no information of use. I would now like what I might call a supplementary answer.


Mitchell William Sharp: I answered this question very carefully. The question put on the order paper was in most general terms, and it was answered in the terms in which it was asked.


Stuart A. Fleming: Mr. Speaker, in order to defend the question which the minister contends was asked in most general terms-


Mr. Speaker:: I am sorry to interrupt the hon. member, but important as the question is, perhaps he could rephrase it and put a new question on the order paper, as time is moving on and this is developing into a debate.


Stuart A. Fleming: The
only thing I can suggest to you, Mr. Speaker, is that if this is the answer to the second portion of my question, which refers to farm machinery including United States components, the answer I got-


Mr. Speaker:: Order, please. This illustrates the difficulty. The hon. member for Winnipeg South Centre.


Stuart A. Fleming: Are
you afraid of it over there?


Hon. Gordon Churchill (Winnipeg South Centre):: Mr. Speaker, I regret that I have to rise now on a question of privilege. I have just read the question and I draw Your Honour's attention to it. The second part of the question was:
Are there any restrictions on Canadian manufactured farm machinery including American components?
And the answer given was:
Answered by 1.
-which simply says-
An export permit is required to export goods to any country included in the area control list, which includes mainland China.
This afternoon the minister gave a different answer to a question which was similar to the second part of the question previously put on the order paper. If we cannot rely on the answers given by the ministers, then where are we? We have to have clear, precise and accurate answers; otherwise there is
Inquiries of the Ministry no use in asking oral questions or putting questions on the order paper.



REPORTED U.K. PROPOSALS RESPECTING PREFERENTIAL TARIFFS

[Stage Direction]
On the orders of the day:
Mr. Real Caouelle (Villeneuve):: Mr. Speaker, my question is directed to the Minister of Trade and Commerce.
Can the minister tell the house what stand the members of the Canadian delegation are taking with regard to the British proposals to abolish preferential tariffs? For instance, is Canada ready to grant developing countries the same privileges as Great Britain with regard to the preferential tariff?


Mitchell William Sharp: Mr. Speaker, I assume the hon. gentleman is referring to the United Nations conference which is just under way and at which my colleague the Secretary of State for External Affairs is the Canadian delegate. There is a proposal before the conference for a new system of preferences in favour of the underdeveloped countries by the industrialized world. This proposal is under discussion, and I think we should wait for a report from the Canadian delegate before replying to that question.



COMPLETION OF TRANSLATION OF BEAUCHESNE

[Stage Direction]
On the orders of the day:
Mr. Gilles Gregoire (Lapoinle):: Mr. Speaker, may I put a question to the Prime Minister?
Is the Prime Minister aware that the French translation of Beauchesne's Parliamentary Rules and Forms is finished and, if so, is it true that he intends to offer it as an Easter gift to French speaking members who are up against parliamentary procedure?


Lester Bowles Pearson: Mr. Speaker, I was not aware, and I am grateful to my hon. friend for informing me of the fact, that the translation has been completed. If it is completed I hope we can make the French version available to members at once. I will look into the matter immediately.



DIVISION BELLS IN WEST BLOCK


[Stage Direction]
On the orders of the day:
Mr. Charles J. M. Willoughby (Kamloops):: Mr. Speaker, I would like to ask the Minister of Public Works if he would please undertake
1400	HOUSE OF
Inquiries of the Ministry to see that the division bells in the west block are corrected, because they are absolutely silent all the time. We do not hear those bells in any case.
Hon. J. P. Deschatelets (Minister of Public
Works): I shall do this with pleasure, Mr. Speaker, because a few days ago I nearly missed a vote myself.


Mr. Barry Mather (New Westminster):: Mr. Speaker, I have a question which I would like to direct to the Minister of Justice in his capacity as the house leader.


Mr. Speaker:: Order. Surely the question of the bells is not that urgent.


Barry Mather: Mr. Speaker, I would like to ask the Minister of Justice, in his capacity as house leader, whether the fact that the chamber clock overlooking the cabinet benches is running one hour fast today is symbolic of the government's realization that it is later than they think?



ROYAL VISIT


[Stage Direction]
On the orders of the day:
Mr. Harold E. Winch (Vancouver East):: Mr. Speaker, I desire to direct a question to the Prime Minister. I do so as a socialist but also one not ashamed upon occasion and under certain circumstances to be a monarchist. I desire to ask the Prime Minister if his attention has been drawn to the following statement which appeared in the March 23 issue of the Montreal newspaper Le Devoir:
The army of liberation of Quebec has "ordered" yesterday the Queen not to present herself on Quebec territory.. ."unless she is aspiring at being the first British sovereign to die on the Quebec earth".
Although similar questions have been asked before, I ask this question because in spite of all the security measures taken in the United States, a fanatic killed the president. In Canada we do not want a fanatic of any kind killing the Queen of Canada and the commonwealth. In view of these continued threats I ask the Prime Minister what special attention is being given to the matter of whether or not the Queen should come to Canada, particularly to Quebec, and what protection will be afforded her in view of all these threats.


Lester Bowles Pearson: Mr. Speaker, my attention has not been drawn to this statement, which I consider to be a very vicious one representing only a very small minority of the people of Quebec.


Gordon Minto Churchill: It does not take many.


An hon. Member:: Only one.


Lester Bowles Pearson: I am quite aware that a very small minority, indeed a minority of one, can do a lot of damage. There have been tragic examples of this fact. But I can assure my hon. friend and the house that when Her Majesty comes to Canada she will receive every security protection that is possible, and I am sure her visit will be both a happy and a safe one.


Mr. Arnold Peters (Timiskaming):: In view of the fact that more harm than good may come from the Queen's visit, does the government not think it might be advisable to postpone the visit this year?


Lester Bowles Pearson: I think it would be shameful to surrender to this kind of minority and vicious propaganda.


Some hon. Members:: Hear, hear.


Thomas Clement (Tommy) Douglas: While I agree with the Prime Minister's statement, I would like to ask the Minister of Justice what steps are being taken by the Royal Canadian Mounted Police to apprehend the people who are making such statements as well as the persons responsible for the recent theft of arms from a number of armouries.


David Réal Caouette: Mr. Speaker, I rise on a question of privilege in regard to statements pertaining to the Queen's forthcoming visit which were made a short while ago and which, in my opinion, reflect on all hon. members from Quebec. I should like to say to the house that the people of Quebec are just as civilized as anybody else and that the Queen will be as welcome in our province as anywhere else in Canada. She will be greeted cordially.
If there are fanatics in Quebec, the other provinces have their share of them also. Why must some people constantly attack our province with regard to the forthcoming visit of the Queen of Canada.



PENSIONS


[Stage Direction]
On the orders of the day:
Mr. Eric A. Winkler (Grey-Bruce):: Will
the Prime Minister inform the house whether Premier Lesage has presented a pension plan for adoption in the province of Quebec which is deemed by the government to be equal to the Canada pension plan?


Lester Bowles Pearson: I cannot very well answer that question on orders of the day and make a comparison of

the two pension plans, one provincial and one national. We will be discussing these matters next week.


Eric Alfred Winkler: Is the Prime Minister aware of the fact that this is the criterion which is outlined in the present bill? I think the house has a right to know.


Lester Bowles Pearson: Yes, I am quite aware of that important fact, Mr. Speaker.


Hon. George C. Nowlan (Digby-Annapolis-Kings):: May I ask a supplementary question. Can the Prime Minister advise the house if the government has approved a proposed Quebec bill as being equivalent to the pension bill which is now before this house?


Lester Bowles Pearson: No, Mr. Speaker, we have not approved a bill. Indeed, it would be quite improper for us to approve it.


John George Diefenbaker: Has one been submitted to the government, or are they just proceeding on a nebulous uncertainty?


Lester Bowles Pearson: No, we are not proceeding on a nebulous and uncertain hypothesis. The text of the bill has not yet been submitted to the federal authorities.


Mr. Mandziuk:: Would the Prime Minister care to comment on the point of allowing or disallowing such a Quebec pension scheme?


Lester Bowles Pearson: I am surprised that any hon. member of this house would suggest that the government should disallow a Quebec pension bill.


Louis-Joseph Pigeon: Mr. Speaker, may I ask the Minister of Justice a supplementary question?
Could the minister tell the house whether, according to the Canadian constitution, the provinces, including Quebec, have the right, the same as the federal government, to establish a pension fund?


Hon. Guy Favreau (Minister of Justice):: Mr. Speaker, in my opinion just reading the bill will clearly indicate the government's view on that point.


Louis-Joseph Pigeon: On a point of order, Mr. Speaker. I asked the Minister of Justice a very specific question, namely whether the provinces have the same right as the federal government to set up a universal pension plan?


Mr. Gilbert Rondeau (Shefford):: Mr. Speaker, I should like to direct a question to the Prime Minister. Could he tell us whether
Inquiries of the Ministry he is supporting the hon. member for Drum-mond-Arthabaska (Mr. Pepin) when he makes the following statement:
A health insurance plan is more important than a retirement fund plan for the province of Quebec.


Lester Bowles Pearson: I do not think I am called upon to answer that question, endorsing a statement made by a private member in his private capacity.



UNITED NATIONS


[Stage Direction]
On the orders of the day:
Hon. Paul Mariineau (Ponliac-Temisca-mingue):: I have a question for the Prime Minister. Did the Prime Minister's statement of yesterday concerning the refusal of certain nations to share the costs of peace keeping operations take into consideration the compromise plan brought forth by Britain and the United States to avoid an otherwise serious struggle within the United Nations?


Lester Bowles Pearson: Yes, Mr. Speaker; if some arrangements can be made by which those members in default will pay up at least part of their deficit before the date in question, the action that was suggested by me yesterday as being required under article 19 of the charter would not be necessary.



DOMINION-PROVINCIAL RELATIONS SUGGESTED ESTABLISHMENT OF SECRETARIAT

[Stage Direction]
On the orders of the day:
Mr. Heward Grafftey (Brome-Missisquoi):: I have a question for the Prime Minister. Will the federal government make any specific, and I underline the word "specific", suggestions or proposals at the forthcoming federal-provincial conference for the establishment of a secretariat or similar body for federal-provincial affairs?


Lester Bowles Pearson: We had a most useful discussion on this subject at last November's meeting and that discussion will be continued at the forthcoming meeting. Perhaps out of it will come agreement on how best to maintain liaison between conferences.



CANADIAN NATIONAL RAILWAYS


[Stage Direction]
On the orders of the day:
Mr. Alexandre Cyr (Gaspe):: Mr. Speaker, I should like to direct a question to the

Inquiries of the Ministry Minister of Transport. Could he tell the house whether he has a definite compensating program, in view of the cancellation of plans to go ahead with the construction of a railway line between Ste. Anne des Monts and Matane?


Mr. Vincent:: A change of government. [Text]


Hon. J. W. Pickersgill (Minister of Transport):: While there is not yet a definite and final program to replace the railway which parliament provided for and which the government decided would not serve the transportation needs and other economic interests of the northern part of the Gaspe as well as other means of transport, the government has entered into discussion concerning arrangements to make a substantial contribution to the provincial highway in order to speed up the completion of a modern heavy duty highway. My colleague the Minister of Public Works, my colleague the Minister of Citizenship and Immigration and I met the minister of roads of Quebec the other day in this connection.
The government is also giving consideration to harbour improvements and to improvements in air facilities which we believe will serve this region better than the proposed railway.


John George Diefenbaker: I would ask the hon. minister this. Is it within the authority of the government, without having an act passed by parliament to repeal an existing statute, to refuse to carry out the terms of a statute which has been passed by parliament? I should like to know the hon. gentleman's views on this, because he is quite a constitutional expert.


John Whitney Pickersgill: I would certainly not be nearly as competent to answer that question as would the right hon. gentleman. However, he is asking me for a legal opinion, and it is contrary to the rules for any minister to give a legal opinion in the house. I would be interested to hear any views which the right hon. gentleman has on the subject.


John George Diefenbaker: I am not giving the hon. gentleman my views, but may I say this. I think it constitutes an affront to parliament for a minister of the government to say "We do not intend to follow a statute which was passed by parliament for the simple reason that we have another plan".


Mr. Erik Nielsen (Yukon):: A supplementary question with respect to the minister's remarks concerning air policy and the implication that it is being tackled on a piecemeal basis. Will the hon. gentleman assure the house that he 
will consult with national aviation organizations before establishing a national air policy in this country?


John Whitney Pickersgill: I do not see that this is much of a supplementary question. However, I can tell the hon. member that I have already
discussed this matter with a great many of the national organizations concerned with air transport in this country.


Erik Nielsen: On a question of privilege-


Some hon. Members:: Oh, oh.


Mr. Speaker:: Order. I think we have pursued that subject far enough. This is developing into an argument between two hon. members, and surely we have better things to do.


Erik Nielsen: On a question of privilege, the minister has smuggled into his reply a reference to the legitimacy of my question. My supplementary question was perfectly proper, because it was the minister himself who raised the question of air policy, not me.


John Whitney Pickersgill: Since the hon. member has chosen to make this a question of privilege, let me say I did not mention air policy at all in my answer to my hon. friend from Gaspe. I said that consideration was being given to providing certain air facilities in one particular region, and that obviously is not air policy.


Mr. E. Nasserden (Roslhern):: Mr. Speaker, I have a question for the Minister of Transport. In view of the minister's remarks today, regarding assistance for highway construction, do his remarks indicate it is government policy to provide additional assistance to highway construction anywhere in Canada?


John Whitney Pickersgill: Mr. Speaker, I do not think that would be a correct inference to draw from my statement.



HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question to the Prime Minister. Would the right hon. gentleman care to confirm in this house the view which he is reported to have expressed yesterday when he addressed a conference on mental health. In particular, is the government considering including treatment for mental illness within the terms of the Hospital Insurance and Diagnostic Services Act? Could the Prime Minister say, at the same time, whether a similar course might be followed with respect to treatment for tuberculosis?

Inquiries of the Ministry


Lester Bowles Pearson: Perhaps I should send the hon. gentleman a text of what I said. As will be seen from the text, I said that this aspect of the matter was under consideration and would be under consideration next week, in connection with certain shared cost programs, at the federal-provincial conference.



COMPOSITION OF COMMITTEE TO STUDY HARMFUL EFFECTS OF DRUGS

[Stage Direction]
On the orders of the day:
Hon. Judy V. LaMarsh (Minister of National Healih and Welfare):: Mr. Speaker, on March 12 the hon. member for Simcoe East asked me a question regarding the establishment and composition of a committee my department was setting up to investigate the drugs parnate, parstelin and parstelin S2.
I am happy to report that I am now able to give the house a further reply. A committee has been set up consisting of the following: Dr. K. I. Melville, professor of pharmacology, McGill University; Dr. K. J. R. Wightman, professor of medicine, University of Toronto; Dr. T. L. Sourkes, associate professor of biochemistry, Allan memorial institute, McGill University; Dr. D. R. Gunn, director of chemical research, Ontario hospital, New Toronto, and Dr. H. B. Durost, director of medical services, Verdun Protestant hospital.
The first meeting of this committee is scheduled for April 6 and another for April 27. We expect that they will submit a report of their findings very shortly thereafter.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. Raymond Langlois (Megantic):: Mr. Speaker, I should like to put a question to the Minister of Labour. What steps does the minister intend to take in order to ensure an equitable income to the 600 employees of the Asbestos Corporation and the Johnson's Company Limited of Thetford Mines and Black Lake that have just been merged, a fact which will involve the dismissal of 600 employees in the very near future?


Allan Joseph MacEachen: I will ask the national employment service to assist the displaced employees in any way in which its services can be useful.


Raymond Langlois: Mr. Speaker, I should like to direct a question to the Minister of Industry and Minister of Defence Production.
In view of the fact that 600 men have been laid off by mining companies at Thetford Mines and Black Lake, is it the intention of the minister to create secondary industries in that district so as to provide employment for the largest possible number of people and to boost the local economy since the district is already considered as a designated area?


Mr. Speaker:: That question should be put on the order paper.


Hon. C. M. Drury (Minister of Industry):: Mr. Speaker, I was rising to answer the question which is to be put on the order paper.


Raymond Langlois: Mr. Speaker, I believe the minister is referring to the answer to my question, and since he is ready to answer it perhaps you would allow him to do so.


Charles Mills (Bud) Drury: Mr. Speaker, I share your view that it would be more proper to put it on the order paper.



REQUEST FOR EXTENSION OF WINTER WORKS PROGRAM

[Stage Direction]
On the orders of the day:
Mr. Lucien Plourde (Quebec West):: Mr. Speaker, I wish to direct a question to the Minister of Labour.
Is the Minister of Labour aware of the fact that certain municipalities hiring workers under the winter works legislation are paying them with vouchers good only for groceries?


Allan Joseph MacEachen: No, Mr. Speaker.


Louis-Joseph Pigeon: Mr. Speaker, may I direct a supplementary question to the Minister of Labour?
Since several cities in Canada, including Joliette, will not be able, for lack of time, to complete all their winter work projects, does the minister propose to extend the winter work period beyond April 30.


Allan Joseph MacEachen: No, Mr. Speaker.

Inquiries of the Ministry [Translation]


Gilles Grégoire: Mr. Speaker, I would like to put a supplementary question to the Minister of Labour. Does he intend to extend the winter work period in areas handicapped by climatic conditions which, in view of that fact, are discriminated against compared to areas enjoying a more temperate climate which can carry out their winter work programs within the prescribed period?


Allan Joseph MacEachen: No, Mr. Speaker. [Translation]


Gilles Grégoire: Mr. Speaker, I would like to ask a supplementary question-


Mr. Speaker:: Order, please. I have grave doubt that the question of the hon. member for Lapointe was in order. It seems to me this question has been asked several times during the present session.


Gilles Grégoire: In that case, I shall ask a supplementary question which will be in order.
Does the Minister of Labour intend to investigate that matter and seek an appropriate solution to promote or, at least, in order to balance out the winter work program benefits in the regions of Canada with a more severe climate which, as a result, have the highest level of unemployment?


Allan Joseph MacEachen: Mr. Speaker, I will ask the officers of the department to investigate the operation of the program to ascertain whether in any area it has placed any municipality in a disadvantageous position. After that investigation we shall be glad to consider this question.



D.E.W. LINE  ENFORCEMENT OF DECISION RESPECTING BARGAINING AGENT

[Stage Direction]
On the orders of the day:
Allan Joseph MacEachen: Mr. Speaker, may I answer a question asked yesterday by the hon. member for Northwest Territories with respect to the status of the international brotherhood of electrical workers as bargaining agent for the Federal Electric Company.
The facts are that last November this union was certified for a group of employees. Later the following month the Federal Electric Company moved to quash the certification of the Canada labour relations board. However, I understand that yesterday the judgment of the court of Queen's bench of Manitoba on this matter was handed down and that the status of the bargaining agent has not been


affected in any way. In the absence of any unforeseen development, the way would now appear open for collective bargaining between the company and the certified bargaining agent.


Mr. Gene Rheaume (Northwest Territories):: A supplementary question, Mr. Speaker. Yesterday the minister promised to inquire whether or not an agreement had been signed between the governments of Canada and the United States suspending the rights of these men. I wonder whether the minister was able to look into that point.


Allan Joseph MacEachen: Mr. Speaker, I have asked for information. There has been no evidence to support that particular point, but the investigation is continuing and if there is any evidence I will bring it to the attention of the house.



MINES AND TECHNICAL SURVEYS


[Stage Direction]
On the orders of the day:
Stuart A. Fleming: My question is for the Minister of Mines and Technical Surveys. Is the government at present considering the establishment of an astronomical research institute to include the construction of a 150-inch optical telescope for location in south central British Columbia?


Hon. W. M. Benidickson (Minister of Mines and Technical Surveys):: The government is considering the matter of a telescope of this quality, but as to the location an announcement will be made in due course, if and when an expenditure is approved for it.



SOCIAL INSURANCE


[Stage Direction]
On the orders of the day:
Mr. A. D. Hales (Wellington South):: My
question is directed to the Minister of Labour. It has to do with the question I asked him on Friday last concerning the distribution of application cards for social insurance numbers. At that time I asked under whose authority these cards were being distributed.


Allan Joseph MacEachen: Yes, I have an answer for the hon. member. The application cards for social insurance numbers are being distributed by the unemployment insurance commission under the authority contained in the Unemployment Insurance Act and its regulations.


Alfred Dryden Hales: Could the minister advise the house why these cards do not carry the words "Issued under the instructions of the Minister of Labour"? There is nothing on them to that effect.


Allan Joseph MacEachen: The authority of the Unemployment Insurance Act is the basis of this action. In view of the relationship between the Minister of Labour and the commission under the law, I think it would be improper to have the minister's name applied in that way when the authority of the commission can be used.


Alfred Dryden Hales: Is the unemployment insurance commission not responsible to the Minister of Labour?


Allan Joseph MacEachen: Mr. Speaker, this is another legal question in a sense, but it is a fact that the unemployment insurance commission is a commission and occupies an entirely different status than the officials of the Department of Labour.


Reid Scott: A supplementary question, Mr. Speaker. In connection with these social insurance applications, is the minister aware that the form of application in requiring men to disclose the maiden names of their mothers, requires them to indicate whether they were born out of wedlock, which seems to be visiting the sins of the parents upon the children. I wonder whether the minister would look into this aspect of the questionnaire.



SHIPPING


[Stage Direction]
On the orders of the day:
Mr. P. B. Rynard (Simcoe East):: Mr. Speaker, I would like to draw your attention to the fact that the official opposition seems to be running an hour ahead of the government. I would like to ask a question based on the following report:
Rapidly declining water levels in Georgian bay and lake Huron can put a serious crimp on the economic lives of-
-towns in that area:
-unless remedial measures are undertaken in the not too distant future.
The three foot drop that has taken place in the level of the bay during the last three and a half years is a source of no little concern to shipping interests which employ a goodly number of men in each of the three communities.
My question, addressed to the Minister of Public Works, is what has the federal government done in the investigation of this matter, and what does it propose to do to offset these falling water levels which seriously threaten 20220-89J
Inquiries of the Ministry the incomes of hundreds of people who are in tourist and commercial businesses in that area.


Mr. Speaker:: That is a very interesting, important and pressing question. Nevertheless I do not think it is reasonable to expect the minister to give a short, concise answer at this time. Perhaps the hon. member would put his question on the order paper.


Philip Bernard Rynard: Mr. Speaker, I just want to draw your attention to the fact that this question was asked some time ago.


Gordon Minto Churchill: And not answered.


Mr. P. V. Noble (Grey North):: Mr. Speaker,
I have a question for the Minister of Public Works. If low water levels create a hazardous situation in any harbour on the great lakes, will the minister give the house his assurance that he will give the problem his immediate remedial attention?


Hon. J. P. Deschatelets (Minister of Public Works):: Mr. Speaker, I do not follow very well the point the hon. member has in mind, but I am going to look into this matter.



AIR TRANSPORT


[Stage Direction]
On the orders of the day:
Mr. H. A. Olson (Medicine Hat):: Mr. Speaker, I would like to ask the Minister of Transport whether the report and the recommendations of the air transport board, arising out of their hearings in Regina respecting the southern prairie air run, have been filed; and if so, when can we expect a decision in this respect? I draw to the attention of the minister that this service was discontinued on January 11 and there has been no air service since then.


John Whitney Pickersgill: Mr. Speaker, to the best of my knowledge, unless the report has been received very recently, it has not yet been made. But I will make inquiries of the air transport board as to when it is likely to be-available.


Eugène (Gene) Rhéaume: A supplementary question Mr. Speaker. Can the Minister of Transport inform the house when he is likely to announce a regional air carrier policy for Canada?


John Whitney Pickersgill: When the government has made a decision as to what the policy is to be.

Inquiries of the Ministry VETERANS AFFAIRS



INTRODUCTION THIS SESSION OF AMENDMENTS TO CHARTER

[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, I wish to address a question to the Minister of Veterans Affairs. Is the government giving consideration to introducing any time this session amendments to veterans legislation that comprises the veterans charter?


Hon. Roger Teillet (Minister of Veterans Affairs):: Mr. Speaker, as I think I indicated a while ago, while the studies are going on it is extremely unlikely that we will be ready to do this before the end of this session; depending, again, upon when this comes about. I am speaking here of before midsummer.



CANADIAN CENTENNIAL


[Stage Direction]
On the orders of the day:
Clément Vincent: Mr. Speaker, I should like to direct a question to the Secretary of State.
Has the minister inquired into clauses 15 and 16 of the regulations established under the federal-provincial agreement concerning the implementation in the province of Quebec of projects to commemorate the centennial of confederation in Canada, and, if so, could he tell us if his government is in favour of contracts being awarded by the provinces without tenders being called, since the grants are of $500,000 or thereabouts?


Mr. Speaker:: May I suggest that this is a question for the order paper, as it requires a detailed answer.


Mr. Vincenf:: No, Mr. Speaker, not a detailed answer; just yes or no.


Mr. Speaker:: In that case it is asking for a legal interpretation, which I do not think arises at this time. Will you put the question on the order paper?


Clément Vincent: It is a policy question.


Louis-Joseph Pigeon: It is a very important matter.


Clément Vincent: It is a question of privilege.


Mr. Speaker:: It is certainly a political question at least, but I think after three interruptions by now the minister has the point.


Clément Vincent: May I ask another question, Mr. Speaker.

Could the minister tell us what is the difference between public tenders and a call for tenders which goes to three contractors?


Mr. Speaker:: The hon. member for Beauce-


Mr. Perron:: Mr. Speaker, I-


Clément Vincent: Mr. Speaker, I have another question for the minister. Is the government in favour of the regulations established following the agreement concluded between Ottawa and the province of Quebec?


Mr. Speaker:: Order, please. The Chair has recognized the hon. member for Beauce.



FINANCE


[Stage Direction]
On the orders of the day:
Gérard Perron: Mr. Speaker, I should like to direct a question to the Prime Minister.
Is he or is anyone of his department aware of the fact that the group of financiers who intend to set up a bank in western Canada have already started selling shares to the general public although the incorporation of the company has not been secured, a fact which could involve losses should this incorporation be refused by the government?


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



TRANSPORT


[Stage Direction]
On the orders of the day:
J. Nicholas (Nick) Mandziuk: Mr. Speaker, may I direct my question to the Minister of Transport and ask him whether Mr. Ross Thatcher, the provincial Liberal leader in Saskatchewan, quoted him correctly when he said that the government plans to set up a railway rationalization fund to take care of and subsidize rail lines or branches of rail lines which are not profitable. If he has been quoted correctly, will this then apply to all lines or just to some particular lines?


John Whitney Pickersgill: Mr. Speaker, I have not seen any purported quotation of me by Mr. Ross Thatcher. If the hon. gentleman wants to send me something I will look at it, but it seems to me we should recall that it is contrary to the rules of the house to ask questions on orders of the day about newspaper reports and their truth.


J. Nicholas (Nick) Mandziuk: Then may I ask the minister whether it is the plan of the government to set up a rationalization fund to subsidize non-paying branch lines?


John Whitney Pickersgill: It is the plan of the government to introduce legislation similar to that of which notice was given by my hon. friend the President of the Privy Council last December, and the hon. gentleman is as well able to read that notice as 1 am.


J. Nicholas (Nick) Mandziuk: A further supplementary question. Has the minister made that promise by telephone to Mr. Ross Thatcher, as quoted in the Manitoba Co-Operator of March 19?


Mr. Speaker:: Order, please.



INQUIRY OF THE MINISTRY

[Stage Direction]
On the orders of the day:
Mr. W. H. Jorgenson (Provencher):: Mr. Speaker, my question is directed to the Prime Minister and is based on a statement made today by the Minister of Forestry to the British Columbia lumber manufacturers association. In his statement the minister stated that the ARDA program is going to operate independently of agricultural control. My question is, is this further evidence of the attempt by this government to isolate the Minister of Agriculture out in the left field and precipitate-


Some hon. Members:: Oh, oh.


Mr. Speaker:: Order. That is not a proper question.



COLUMBIA RIVER


[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: Mr. Speaker, I am sorry to interrupt the Prime Minister but I promised three ladies that I would ask this question. It relates to a most unusual practice that seems to have developed since the present government got into office. Would the Prime Minister inform the house why officials of his office and of the office of the Secretary of State for External Affairs, when replying to letters written to the Prime Minister and the Secretary of State for External Affairs from persons criticizing them on their Columbia river treaty policy, return those letters to the persons concerned?


Lester Bowles Pearson: I shall certainly have to look into that rather original question, Mr. Speaker.
24, 1964	1407
Inquiries of the Ministry NORTHERN AFFAIRS



ADMINISTRATION OF ESKIMO AFFAIRS, QUEBEC- CONSULTATIVE COMMISSION

[Stage Direction]
On the orders of the day:
Erik Nielsen: Mr. Speaker, I have a question for the Minister of Northern Affairs and National Resources which will be as devoid of political connotations as have been the answers given by the treasury benches this afternoon. Has the consultative commission, which on March 4 the minister said would be set up by the governments of Canada and Quebec with regard to the take-over of the Eskimos in Quebec by that province, yet been set up? If it has, what is the membership of that commission?


Hon. Arthur Laing (Minister of Northern Affairs and National Resources):: Mr. Speaker, my non-political answer to the first part is no, and I think the second part is answered by the answer to the first.


Louis-Joseph Pigeon: Mr. Speaker, I should like to direct a question to the Minister of Northern Affairs and National Resources.


Charles James McNeil Willoughby: Mr. Speaker, may I direct a question to the Minister of Public Works-


Some hon. Members:: Oh, oh.


Mr. Speaker:: Order, please. Hon. members must realize it is twenty minutes to four o'clock. The hon. member for Joliette-L'Ass omption - Monte aim.


Louis-Joseph Pigeon: Could he tell the house whether, according to a statement made by Father Steinmann, an Ungava missionary, and a report published in this morning's issue of Le Devoir, Ottawa is trying to impose on the Eskimos in new Quebec a quick assimilation which, in the opinion of Father Steinmann, would be a true genicide?


Arthur Laing: Well, Mr. Speaker, if I understood the hon. member's question correctly, and I think I did, there are a number of assumptions in the question, and I believe the article is purely speculative. I shall have an opportunity to read it and if a statement is warranted I shall make it to the house.



ADMINISTRATION OF JUSTICE


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

The Budget-Mr. Martineau -tion to the Minister of Justice. In view of the fact that John Wasylenchuk, who was extradited under his predecessor, goes on trial for his life today in Seattle, may I ask the minister if he is satisfied that everything possible has been done to make sure that he gets a fair trial?


Guy Favreau: Mr. Speaker, in answer to this question I must say that as far as the Department of Justice and the government are concerned, everything has been done to satisfy us in this respect.



THE BUDGET


[Stage Direction]
The house resumed, from Monday, March 23, consideration of the motion of Hon. Walter L. Gordon (Minister of Finance), that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Nowlan.
Paul Raymond Martineau: Mr. Speaker, in the few minutes still at my disposal before I conclude my remarks, I should like to make some observations concerning federal-provincial relations.
The vague allegations by the minister on that matter leave us puzzled. As a matter of fact, it is enough to wonder whether the government is not preparing a new centralizing offensive which will certainly come to light at the opening of the conference on March 31 next.
The doings of the Minister of Finance (Mr. Gordon) in rushing through the budget, only a few weeks before that conference, are bound to give rise to most serious doubts. We wonder why such haste to introduce a budget which is much more noteworthy by its omissions than by its contents.
It seems that even the date chosen for the introduction of the budget speech is an affront to the provinces. Yet, at last November's conference, the attitude of the provinces was clearly set out and could be resumed as follows:
1.	Systematic objection to any federal action which in fact curtails the field of provincial jurisdiction.
2.	Absolute opposition to any unilateral federal action which is bound to upset provincial priorities, particularly in the case of area development.
3.	Since economic problems seldom come under exclusive federal jurisdiction, the provinces should be consulted every time decisions are taken which might affect their economy.


4.	Participation in one way or another, through permanent federal-provincial agencies set up for that purpose, in the determination of any federal policy likely to affect the provinces.
Mr. Speaker, such is the very clear position which was proposed not only by the government of the province of Quebec, but by the governments of several other provinces. As a matter of fact, if we refer to the press release which was issued after that conference, it seems indeed that the federal government had agreed on those view points, because it states that a thorough consultation must take place about the measures it is deemed advisable to pass and, for that purpose, it suggests the setting up of a system which will make possible such close and permanent consultation and will make sure that all governments will have all the required authority to assume their respective responsibilities.
So that the words co-operative federalism will not be mere window dressing to cover a fool's agreement, I direct the following questions to the Minister of Finance:
Why have not the necessary provisions been passed yet to implement those objectives?
Why were not steps taken to make it easier for the provinces who so desire to withdraw from joint programs, and why are new joint programs being developed?
In view of the provisions of the budget itself, will it be possible to make new fiscal arrangements that will meet the demands of the provinces?
Why did not the Minister of Finance consult his provincial colleagues before preparing his budget?
And, finally, what positive provisions have been taken, or are going to be taken by the government to carry out the various suggestions and recommendations not only from this side of the house, but from all its corners, tending to establish a sound federalism, and more particularly the following suggestions:
The immediate establishment of an adequate permanent federal-provincial secretariat, which might group in its set-up all the various agencies for federal-provincial consultation.
The setting up of a constitutional Senate committee, as was suggested the other day by the hon. member for Three Rivers (Mr. Balcer).
The repatriation of our constitution and its adjustment to modern needs, which would, again, answer the exigencies of a sound federalism.

The setting up of a constitutional court, which as a last resort would decide any possible disputes between the provinces and the federal government, as well as all constitutional differences.
And, lastly, which is perhaps a new suggestion, the establishment by the House of Commons of a standing committee responsible for matters which, perhaps, more particularly affect the province of Quebec.
Mr. Speaker, until we get satisfactory answers from the Minister of Finance, I respectfully submit that it is useless to speak of co-operation, of co-operative federalism, and that our confederation system will never run smoothly.
In closing, I must say that budget does not look like a real budget to me, but just a provisional one, drawn up hastily and which brings no real solution to current problems. Mr. Speaker, finally, I suggest that the minister, now that he has had a little time to think about those questions and the opportunity to hear the views of the members of this house, get down to work earnestly and come up with a real budget-let him call it supplementary or whatever he likes-in order to fill once and for all the painful gaps left by his first abortive attempt.


Mr. Gerard Girouard (Labelle):: Mr. Speaker, I should like first of all to congratulate the Minister of Finance (Mr. Gordon) for the Easter tints he has given his budget. The sentence which impressed me the most in the budget, the one he read most enthusiastically and most emphatically is the following:
All hon. members can take satisfaction from the improvement that has been occurring in economic conditions in Canada and from the optimism with which we can view the immediate future.
Mr. Speaker, we could piously add Alleluia, and all the Easter spirit would be there.
On the other hand, there are other parts of his speech that are a little more in accordance with Passiontide. In certain parts of his speech, the Minister of Finance reminded us of a son who, having pitifully failed an exam, is telling his father about his results. The father is quite sad, but suddenly in a cheerful tone he says to his son: "I congratulate you because at least I am sure that you did not cheat."
Evidently the Minister of Finance did not cheat when he prepared this budget. He admitted it himself, he did not ask the advice of any expert, he did not annoy anyone, and what he presented was pure traditionalism.
However, I wish to say to the Minister of Finance that I was in a somewhat nostalgic mood when I heard him read his budget this year. Last year he came like an eager zealot who had undertaken the conquest of the
The Budget-Mr. Girouard powerful capitalists. I must admit that he had succeeded in stirring up their wrath and that he must have been sorry.
The 1963 budget was perhaps a political disaster for the Liberal party, but for the Minister of Finance himself, it was a sign of greatness. I had a higher opinion of the Minister of Finance in difficulty than I do now when I see him entirely satisfied with the insignificant budget he has just introduced.
Mr. Speaker, the 1963 budget had made few people happy, but it had at least called for sympathy and friendliness. It was good to see a minister reveal himself as an idealist, since he was not young maybe, but new to public office. I know that at the time, he won the admiration of many young members of his party. The minister now introduces a budget which shows that he no longer wants to break new ground. But there is still in him a strain of candour that borders on naivete. "Let us rejoice", he says, but he goes on: "Unemployment is still too high, and in the Atlantic provinces and eastern Quebec it is much too high". He admits it and I recognize that he is frank, but he goes on to say, and this is terrific:
At the beginning of this year the seasonally adjusted figure for unemployment in Canada was just below 5 per cent. However, according to our best current estimates, the figure for British Columbia, again on a seasonally adjusted basis, was just above 4 per cent. For the prairies it was around 2 per cent. In Ontario it had fallen to about 3 per cent, but in Quebec, where the increase in the labour force had been quite exceptional, it was probably about 6 per cent. For the Atlantic region, the figure while falling, was probably still as high as 8 per cent.
I should like to call the attention of the house to the various degrees of assurance used by the Minister of Finance when introducing his statistics. In British Columbia the Minister of Finance is certain, he gives the assurance thataccording to our best current estimates, again on a seasonally adjusted basisunemployment was just above 4 per cent. For the prairies, he is also sure that unemployment is around 2 per cent. In Ontario, he also says flatly that unemployment has fallen to about 3 per cent. But in Quebec the minister is no longer quite sure- neither in the maritime provinces. First he says thatthe increase in the labour force has been quite exceptional.
He does not say how this is done, but it is very unusual. However, it seems that the unemployment rate is 6 to 8 per cent. The minister certainly knows that the percentage has decreased in the maritime provinces, and that it is now 8 per cent. That is about it.
Nevertheless, I would like to ask the minister to explain why these statistics are

The Budget-Mr. Girouard unreliable. Is it not the same experts who compile statistics throughout the country? I would like especially to point out to him and to the government that even though experts are not the same, provinces are, areas are, as are also the workers who have been unemployed for six years.
That is not all, Mr. Speaker. The Minister of Finance went on:
The wide diversity of these figures and the prospect for the current year suggest that broad, general attacks on unemployment will be less useful now-
That beats everything, Mr. Speaker. Reference is made to broad general attacks on unemployment, while I am given to understand that in Quebec province there is 6 per cent unemployment, and 8 per cent in the maritimes.
The minister continued:
Accordingly, our plans and policies are increasingly designed to meet the special needs of areas of the country or groups of the population confronted with special difficulties and problems.
There you are. The Minister of Finance has settled the problem. Unemployment is decreasing in western Canada and they say it is because of the far reaching operation by the government. But if unemployment is decreasing in western Canada, it is because of a far reaching operation, but not an operation by the government. It is because of a far reaching operation by Russia, China and other European countries who simply launched the operation "we want bread".
One might think that the government deserves to be commended for having lent a friendly ear to that request? Not at all, Mr. Speaker, because the sale of wheat to communist countries and to European countries was an initiative of the Conservative party.
Indeed, when such action was taken last year, it was among the cries and objections of those who want to take all the credit for it today.
Therefore, I wonder what has become of the "large scale operation of the Liberal party." The Liberal party was to launch a far reaching operation, and what was done actually about it? During the last election it faced a Conservative party which offered wheat sales, vast trade outlets, a winter works scheme, and public works to help the municipalities, new and easier facilities from the Central Mortgage and Housing Corporation, and ARDA. In spite of all these measures, things did not work out the way the Canadian public wanted, people wished to change their government.
Now, let us see what the Liberal party has given Canada since it took over. We had the winter works program, and the first action


the government took in this field was to cut the winter works period. Yet, how many promises had been made with regard to this matter. Each hon. member rose, at one time or another, to ask whether there was no possibility of extending the winter works period. I also rose in the house to ask the minister whether there was any possibility of extending the winter works period in some districts, but I was told that nothing could be done. It is certainly not in the field of winter works that I can note far reaching policies.
Now, what has been the government's policy concerning grants to underdeveloped areas? Much publicity has been made on this subject of underdeveloped areas. Grants were increased by 10 per cent to help them. This did not work either. Why? Because when the municipalities do not even have enough money to buy materials, what use have they for the money offered by Ottawa to pay wages?
There was also this situation-in my own constituency more particularly-on which I want again to call the attention of the house. Four parishes had considerable public works to be done, and they wanted at least to take advantage of this assistance granted by the federal government to underdeveloped areas. Again I wrote to the minister, saying: there are only four parishes in my constituency which do not benefit from the assistance the government grants to underdeveloped areas; would it not be possible to allow these four parishes to benefit from that governmental assistance? Do you know what reply I got? It makes me laugh. I was told: "These four parishes are indeed in your constituency, but they do not come under the same unemployment insurance office. To grant them the same advantages would occasion administrative problems." This is exactly what the Minister of Finance was saying last year.
So, even when I examine the government's assistance program to underdeveloped areas,
I	see nothing of that famous far reaching operation. But I am going to give the government more chances. I shall take a close look at some other of its objectives.
Is it in the building industry that we had a far reaching operation by the government? Well, the government surely did something in the building field. It levied a tax on materials and today they boast that construction was very high this winter. But I hope they will not have the effrontery to pretend that if construction improved, it was because of the new tax on building materials.
If construction was active this winter, it is because people decided to take advantage of the 4 per cent tax before it is raised to 8 or
II	per cent. Mr. Speaker, when this tax on

building materials reaches its maximum level, the government will no longer believe it was a far reaching operation.
Where was it felt that far reaching operation was supposed to provide full employment? Again, the Liberal party was duty bound to promote full employment because specific pledges had been made in this respect, and that is why the Conservative party was defeated at the last federal election. The Liberal party had made all kinds of pledges in this connection but today what have we got: complete failure. Well, I know that the Liberal party had great undertakings in some fields. But I want to tell them that in this day and age, Canadians are very much interested in our foreign affairs, but they are also very much interested in the problems related to defence, especially the citizens in my riding, where a base has been built in La Macaza which is the finest monument to our subjection to the United States. Canadians are also interested in bilingualism and biculturalism, especially in the province of Quebec where, for once, fire defeated ashes. But if Canadians are that interested in all those accomplishments of the Liberal party, it is as long as they can sit at night, with a full stomach, before their television sets to read their newspapers.
Mr. Speaker, the Minister of Finance tells us there are 6 per cent of unemployed in the province of Quebec. This figure can represent as much as 100,000 heads of families which have inadequate housing, clothing and food. However, as I have said, the minister in this atmosphere of well-being continues to talk about "the optimism with which we can view the immediate future".
Now, if one considers the unemployment problem, one realizes that the large scale operations in this field by the government since the Liberal party came into office, are highly questionable.
Let us consider the farming situation. I would not like the Minister of Finance to forget that farmers are also in the Easter season. I would not like to do like the former member for Bellechasse who, every time he rose, said he spoke on the part of the 92,000 farmers in eastern Canada whose income is below $1200 a year. I would not like to repeat that to no avail, but the situation is serious. I certainly should like to know what the government has achieved in the way of large-scale operations to assist eastern farmers.
In my constituency, as well as in the province as a whole, only one farm out of three can keep on operating at the present time and, if it can manage to do so, it is because the head of the family goes off by himself to find a job somewhere else. And if at any time he should be unlucky enough to lose that job, 20220-90
The Budget-Mr. Girouard well, on top of that, he is not even entitled to unemployment insurance benefits, because then he is told: "You are a farmer". Where then is that wonderful large scale operation the Liberal party was supposed to carry out to promote eastern agriculture?
I could quote statistics and give examples, but that would not change the situation a bit, for I am convinced that each and every one of us is familiar with the problems of our eastern farmers. They are so well acquainted with them that they should have found a solution during the last election campaign.
It had been said that the member for Matapedia-Matane (Mr. Tremblay) would be the next minister of agriculture for eastern Canada. It seemed serious enough, because the hon. member had announced it himself. But later, when a member of the opposition-
I think it was the member for Joliette-L'As-somption-Montcalm (Mr. Pigeon)-pressed the government to say when the minister of agriculture would be appointed, the member for Lotbiniere rose to his feet and cockily said: "One minister of agriculture will not be sufficient, we want two departments". And now, the member for Matapedia-Matane has become a specialist in railroads which remain unbuilt. But we have no department nor minister of agriculture for eastern Canada.
I see no mention of large scale projects put forward by the government for the benefit of eastern farmers. Who will take the matter in hand then, I ask you?
The other day, the hon. member for Nicolet-Yamaska (Mr. Vincent) gave me dreadful examples showing why the Department of Agriculture in Ottawa is completely unaware of the problems of Quebec farmers. Since the government likes so much to set up commissions and to advertise widely its accomplishments, I think it would be time to launch an investigation on farm problems in eastern Canada.
A great number of my constituents, including many farmers, ask me what I might possibly do for them in Ottawa. I was able to do little if anything for them. The case of one of my electors has been of particular interest to me. His name is Mr. St. Pierre, he lives in my riding and he came to see me one day to talk about a farm loan application he had made. The agronomists had looked over his land and they had advised him to apply for a loan, telling him that he had a very good chance to get it as he met all the requirements. But Mr. St. Pierre did not get his farm loan.
This may be of interest to the house, although I do not want to establish any relation between the two things but the inspector who looked over Mr. St. Pierre's land
1412	HOUSE OF
The Budget-Mr. Girouard was the brother-in-law of the Liberal candidate I defeated. And Mr. St. Pierre was one of my supporters. I do not want necessarily to establish any relations between these two facts. However, I submit that if the government wanted to set up a royal commission on that matter it would get very interesting information.
Once again, Mr. Speaker, I ask the government who will act for the eastern farmers in future, and in what way?
But, Mr. Speaker, it might be that unemployment and agriculture are not such important problems for the government. We note how successful it has been in other fields. And the minister continues:
The deficit in our current account balance of payments with other countries is still too large but it is smaller than it has been since 1954.
Mr. Speaker, should we then congratulate the Liberal party which laughed at the Conservative party, saying that the dollar was worth only 92.5 cents. Today, the government seems to say: It is thanks to us if the trade balance righted itself.
Come now. It is a well known fact that the improvement in the trade balance is due to the action taken by the former minister of trade and commerce, Mr. George Hees.
On what does the Liberal party deserve to be commended? Perhaps in connection with federal-provincial relations, according to the statement made by the minister when he said:
But now the public expects so much from both levels of government that they often appear to be in competition with one another.
I often wonder whether it is the public who expects everything from both levels of government or if it is not rather the federal politicians who find it very profitable to take advantage of the public during an election campaign.
I appreciate that the provinces have needs in the fields of education, assistance to the municipalities and social legislation, but when the people have requests to make along those lines, they address themselves to the proper authorities.
However, during election campaigns, politicians profess their willingness to help the people. It looks good to promise scholarships and municipal loans because it brings votes. Yet, it is the public which must bear the burden of the uneven distribution of revenues between the two levels of government.
The burden is so unevenly distributed today that we are now in the midst of a constitutional chaos.
To get out of it, two alternatives seem possible: either we break resolutely through the constitutional walls, or go under them. 

The latter alternative is what the Secretary of State calls co-operative federalism. But if the government is able to pay out $10 to every student across the country, if it is able to set up a municipal loans fund, if the government goes into provincial fields, where is he going to get all the money? From the provinces, it is as simple as that.
I am wondering if it would not be much simpler for the Minister of Finance to abide by the constitution and allow the provinces themselves to collect these $10 and to distribute them.
If the federal parties have not enough promises left, may I suggest a few to them. In the field of external affairs, the federal politicians could travel about and promise peace, they might even promise the appointment of an ambassador to the Vatican. As far as defence is concerned, they could travel about and promise disarmament, and to do so, I give them my permission to demolish the Bomarcs stored in my riding; this would create jobs for the unemployed. In the postal field, they could promise a well-organized rural service and in the municipalities, a more efficient home delivery service.
There you have the best promises a federal party could make and that would be much better than tampering with the constitution.
I would not care to swim against the current all the time, but there is one idea I should like to put forth concerning what is constitutionally legal in all those federal-provincial agreements. We have reached the point where provincial premiers meet and decide to amend the constitution. Now, that is something which belongs to the people and which only the people can amend.
All members of the house should ponder over the fact that it is not up to a province to amend the constitution, but to a whole people, and that the normal way to proceed in such a case is to hold a referendum.
Since the constitution must be amended, let us do it as soon as possible. Let us repatriate it and amend it. Many suggestions will be made and some minorities will fear that, in so doing, the majority will gain the upper hand. There are several possible solutions in that respect, but even if the latter is adopted, it must be remembered that to carry out such a project, the provinces must get together and give their unanimous consent, otherwise each province could appeal to the supreme court. However, it would be possible to protect the rights of individuals.
Mr. Speaker, I shall summarize my remarks by calling four or five points to the attention of the government.
Things have not started rolling as far as unemployment is concerned; must we have

confidence in the government? The condition of agriculture is still unsatisfactory but, there again, must we trust the government? The national defence situation is not as it should be; must we have confidence in the government in that respect and also as concerns biculturalism?
That is the only thing we do, trust the government. We have been placing our trust in the government for a year now and we are expected to go on doing so.
I can assure you of one thing. The more we trust the government and the longer it takes to act, all the harsher will Canadians be towards the Liberals when they go to the polls. It will not be able to say that it has gone through a difficult period. But if the Liberal party cannot accomplish miracles, let it stop pretending that it can work miracles.
I hope that during the few years it has left it will mend its ways and do more than it has done since we have been sitting here.


Hon. Walter L. Gordon (Minister of Finance):: Mr. Speaker, before speaking about the amendment that is before the house I should like to say something about the economic measures that were taken by the government last spring and summer and the economic policies that have been followed since that time; about the economic objectives enunciated in the budget speech, and about the present economic outlook in Canada. First of all let me review the economic policies and the economic measures that have been introduced by the government, and their effects so far.
The first one to which I should like to refer -and they are not in any particular order- is the $500 winter house building bonus program. The purpose of this measure was to even out to some extent the seasonal peaks and valleys in employment in the house building industry; to provide more jobs, in other words, during the winter months. Mr. Speaker, hon. members of the house may remember that this program was ridiculed last spring as a gimmick, but the measure has proved to be eminently successful. As an example, housing starts in the months of December, 1962 and January, 1963 were 12,009; for December, 1963 and January, 1964 housing starts were 24,191, or more than double the number of the year before.


Some hon. Members:: Hear, hear.


Walter Lockhart Gordon: One of this country's prominent home builders, Mr. Noel Zeldin, the president of Consolidated Building Corporation, has gone on record as approving of the $500 bonus program. He is also on record as saying that the sales tax, about which some 20220-90i
The Budget-Mr. Gordon hon. members have become so exercised, is not nearly as onerous as might be suggested. He is quoted in the Montreal Star of March 7 as saying:
If the government feels that the revenue is needed, then the building industry must accept it and learn to live with it. We must be prepared to provide this contribution which, in the final analysis, rebounds and benefits all Canadians.
He went on to say:
-the truth of the tax matter, I feel, is that it will not affect the sale of private homes to any appreciable extent.
This man, Mr. Zeldin, is the president of a company that at the moment is building an apartment project in Victoria, a housing development in Vancouver, six housing developments and two apartment projects in Toronto, and three more housing developments in Montreal. He said, in regard to the $500 bonus for winter home building that this has all but taken the cycle or seasonal aspect out of this phase of the construction business. In other words-and I quote Mr. Zeldin-"it has been a roaring success".


Some hon. Members:: Oh, oh.


Walter Lockhart Gordon: Some people in the building business have complained that there may be some falling off in the spring, and this is quite true. It was the object of the exercise to transfer work to the winter months. I can assure all hon. members of the house that this program will be continued next winter.
The second measure, Mr. Speaker, to which I wish to refer is the accelerated rates of capital cost allowances for Canadian owned companies and companies with a degree of Canadian ownership. Unquestionably this policy has proved to be a powerful incentive and is responsible in part for the substantial increase forecast recently for private capital investment in 1964. Hon. members will recall that the forecasts made for 1964, excluding housing, show an increase of 7.7 per cent over last year, and if housing is included the figure is 8.6 per cent. This stimulus through these increased capital costs allowances will continue through 1964 and the first half of 1965.
The third program I should like to mention is the automobile incentive program. This is also proving to be a success. We have all read in the press of the plans of the various automobile companies to expand their facilities in Canada, plans which will provide more jobs a year or two from now and more jobs in the meantime on the construction phase of the expansion.
Fourth, I refer to the extended provisions for technical and vocational training. As my colleague the Minister of Labour (Mr. Mac-Eachen) indicated to the house on February
1414	HOUSE OF
The Budget-Mr. Gordon 24, the new measures taken to strengthen our technical and vocational training program have had excellent results. There has been an increased enrolment in schools and in training programs, a decline in the number of school drop-outs and a downward swing in unemployment. The government believes that it is of vital importance to upgrade the skills and training of the Canadian labour force so as to equip our young people especially for the kind of jobs which will be available in the future.
To digress for a moment, Mr. Speaker, I should like to mention the measures proposed in the budget this year to help people improve their skills and training. The first one is the extension of family allowances to students of 16 and 17 who remain in school. I suspect that other hon. members have received enthusiastic comments about this particular program as I have in the last 10 days, and that they will agree with me that it has been very well received across the country.


Eric Alfred Winkler: It is the best thing in the budget.


John George Diefenbaker: You voted against it on February 27.


Walter Lockhart Gordon: And I expect you are going to vote against it tonight, if you will give me a chance to finish my remarks.


Michael Starr: Do not get all riled up; you are doing very well so far.


Walter Lockhart Gordon: The second point in this general connection which helps people to improve their skills and which is provided for in the budget is the provision that tuition fees of part-time students may be deducted from taxable income; and the third is the proposal that loans on an interest-free basis should be made to university students. I think that we on this side of the house feel very pleased and satisfied that we were in a position to bring in these three measures which will do something for the younger people of this country.
The fifth measure I wish to mention is the incentives provided last year to stimulate activity in areas of slower growth. This is another policy that was ridiculed by the opposition when it was first announced, perhaps because it was new and untried in Canada. About 150 inquiries respecting possible projects for designated areas have so far been handled by the area development agency. Of these, 34 companies have formally indicated that they will go ahead with projects to be located in 14 of the 35 designated areas. They involve a capital investment of over $73.5 million and are expected to provide some 5,000 new jobs. The indications are that the Minister of Industry (Mr. Drury) will 

shortly be asked to certify new projects representing another $100 million or so . in capital investment.
The extension of the tax concession in designated areas to April 1, 1967 has been greeted with enthusiasm. If I may, I should like to quote a letter which I received from Mr. W. N. Hall, president of Dominion Tar and Chemical Company Limited whose head office is in Montreal. He says:
I should like to express my thanks and congratulations to you on the inclusion in the budget of an extension of the tax concessions in designated areas to April 1, 1967.
My thanks are on account of the fact that I believe the concessions will be most helpful in allowing this company to do some things which otherwise would not be possible, and my congratulations are because I am sure this extension will bring needed industry to a number of areas which would not get industry on a normal taxation basis.
The sixth measure to which I wish to refer is the creation of the municipal development and loan board. There are 107 loans to date under this program amounting to $42.5 million, the largest of which so far is a loan of $29 million to metropolitan Toronto. I expect most applications under this act will be made this year, 1964, although the effects of increased employment resulting from them will continue until March 1966. As hon. members will recall, when the bill leading to the Municipal Development and Loan Act was being debated it was made clear that it was an intermediate program, or that its effects would be for the intermediate period. Most municipalities had already established their capital budgets for the calendar year 1963 and it was thought unlikely that many of them would be able to take advantage of these additional credit facilities during the 1963 year. We are now finding that municipalities are beginning to take advantage of the credit made available under the act for 1964.
The seventh measure to which I would like to refer is the Atlantic development board. Projects approved to date include, first, a power development at Mactaquac, New Brunswick, amounting to some $20 million. Another $20 million is being spent on the power development at bay d'Espoir in Newfoundland-I believe that is the correct way to pronounce the word in Newfoundland, if not in some other parts of Canada. Third, assistance is being provided for basic facilities for the fishing industry at Georgetown, Prince Edward Island; and the fourth project so far is assistance for basic facilities, again for the fisheries, at Canso, Nova Scotia. I personally am delighted that this measure to improve the basic economic structure of the Atlantic area is taking hold. The Atlantic development fund is the outcome of a recommendation made in the fall of 1956 by a royal

commission of which I had the honour to be chairman. It has taken a long time, some people might think too long, to act on the recommendations of that commission, but we are now beginning to get somewhere. If it results in an improvement in economic conditions in the Atlantic area I am sure all members of the house and all people in the country will be more than pleased.
The eighth point I would like to make is in connection with the monetary policy that has been pursued and the spread between interest rates in Canada and the United States. During 1963 the operations of the Bank of Canada were directed towards encouraging credit conditions in a way which would help to strengthen and sustain the expansion of the Canadian economy.
Interest rates in the United States rose moderately during the course of 1963, and I think that the real phenomenon is that the spread between United States and Canadian rates narrowed appreciably. There seems to be general agreement with the monetary policy that has been followed, and it is one of the reasons why the Canadian economy has been expanding.
These various policies and measures are paying off. They are working well and they will continue to work well. All of them have contributed directly to the improvement in our economic picture.
Before leaving this subject I should like to say a word, more or less in parenthesis, about the older workers program. This program was not expected to be the final answer to the employment problem of older workers, and for that reason it was introduced on an experimental basis. The program was designed to assist employers during the period an eligible older worker was given the training and work experience necessary for his continued employment.
In some cases difficulty was experienced in finding workers to fill approved job vacancies, because the types of work offered were not attractive to many of the workers who were suitable for referral to the particular employers concerned. In other cases there was some shortage of eligible older workers who could meet the specifications of the job openings. But up to the end of February 1964 there were 1,986 applications from employers submitted to the national employment service offices. Of this number 1,333 had been approved, and by the end of February 936 eligible older workers had been placed in jobs.
There was a considerable increase in both applications and placements under the program during the month of February. Inquiries also increased in volume, indicating that further increases might be expected in March, the last month of the hiring period.
The Budget

Mr. Gordon The other day the hon. member for Digby-Annapolis-Kings (Mr. Nowlan) referred to the number of older workers placed in jobs up to the end of January, and he compared this figure with the cost of an advertising program to inform people of the older workers scheme that had just been started about that time.
He rather ridiculed the cost of the advertising in relation to the number of people who had been placed in jobs prior to the insertion of the advertisements, in other words, prior to the time most people knew the older workers program was in existence. In reply I would just like to say that the advertising program seems to have been effective. To the extent that this program has been and is being successful, it means the re-establishment as useful members of society of men who had been forgotten, men who had been made to feel they were not needed in our modern age. To the extent we are able to do something about this in one way or another it seems to me we are moving in the right direction. I have said something about the various economic policies and measures which have had considerable to do with the improvement in conditions in Canada in the last eight or ten months. I should now like to say a few words about the economic objectives of the government as set out in the budget speech. The first of these is the maintenance of high levels of employment.
Employment in February, 1964, was 272,000 higher than it was a year ago, the biggest increase in many, many years. Unemployment in February, 1964, was 78,000 lower than it was in the same month in the previous year.
Unemployment, as a percentage of the working force, reached its peak in 1961, and has been falling since that time.
The averages by the calendar years over the last decade have been as follows, and I think the trend is of interest: In 1954 the average was 4.6 per cent; in 1955 it was 4.4 per cent; in 1956 it was 3.4 per cent; in 1957 it was 4.6 per cent; in 1958 it was 7.1 per cent; in 1959 it was 6.0 per cent; in 1960 it was 7.0 per cent; in 1961 it was 7.2 per cent; in 1962 it was 5.9 per cent, and in 1963 it was 5.5 per cent.
The more recent improvement is greater than the yearly averages indicate. The following monthly figures show this on a seasonally adjusted basis. In July, 1963, unemployment was 5.9 per cent of the working force on a seasonally adjusted basis. In August it was 5.4 per cent. In September and October it was 5.3 per cent. In November it was 5.1 per cent, and in December, 1963, and to January, 1964, it was 4.9 per cent. In February of this year it was 4.7 per cent.
1416	HOUSE OF
The Budget-Mr. Gordon
I am perfectly prepared to agree with the hon. member who spoke a few minutes ago that these rates are still far too high. I am not satisfied with the situation where unemployment in Canada is at a seasonally adjusted rate of 4.7 per cent. I am sure all other hon. members of the house are not satisfied either, but at least the curve is moving downwards and we can take some satisfaction from that. We must make sure in our policies and programs that we keep the curve moving downward in the months and years ahead.


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


Walter Lockhart Gordon: Certainly.


J.-H.-Théogène Ricard: Could the minister tell us how many thousands are unemployed now?


Walter Lockhart Gordon: I may be out a few, but my recollection is that there were 467,000 in February, 78,000 less than in February, 1963.


J.-H.-Théogène Ricard: Still over 400,000.


Walter Lockhart Gordon: The second objective is to encourage and maintain a high level of economic growth. The rate of growth in 1963 excluding farm production, which we all know was abnormally high in that year, was about 6 per cent. The estimated growth for the coming year, again leaving out farm production because nobody can tell what kind of crop we are going to have, is about 64 per cent. We are expecting an increase.


An hon. Member:: Juggling.


Walter Lockhart Gordon: No juggling; just planning. The third objective is an expansion of international trade and a reduction in the deficit on current account. The deficit on our current account with other countries was $521 million in 1963, again too high but the lowest since 1954. This country must do everything possible to push our exports so that the deficit in our current account transactions will be brought down to a reasonable balance.
In this connection and because it is vitally necessary to push our exports, perhaps I may be permitted to refer to a policy change that was announced last summer to permit the export of hydroelectric power, provided there are proper safeguards for domestic consumers in the future. As a result of this new policy approach it was possible to move on the Columbia river development which unquestionably will be of tremendous value and benefit not only to the people of British Columbia but to the people of Canada as a whole. Second, the government is working with the government of Manitoba in examining the power potential of the Nelson river to see if


it can be developed at a cost which will permit very large and substantial exports either to the United States or possibly, depending on the circumstances, to Ontario. If the Ontario hydro commission should become really interested in this development on the Nelson it might take some of its future power requirements from that source and as a result reduce the need for imported coal for thermal plants. This would have the same effect as increased exports in so far as the current account deficit is concerned. Finally, there is the great potential development on the Hamilton river about which I should like to say a word or two in a minute.
The fourth objective of economic policy is to maintain reasonable stability in prices and the value of our currency. There has been a lot of comment, quite exaggerated comment if I may say so, about price stability in recent months. I might perhaps give a few comparisons of the changes in the consumer price indices in Canada and other countries between December, 1962, and December, 1963. In the United States consumer prices increased by
1.7	per cent during that 12 month period and in Canada the increase was exactly the same,
1.7	per cent. In the United Kingdom it was
1.8 per cent, in Sweden it was 2.7 per cent, in Germany 3.7 per cent and the same in Switzerland, in France it was 5.7 per cent, in Japan 5.8 per cent, in Italy it was 7.1 per cent. So on the basis of that kind of comparison we have not been doing badly in Canada.
On the matter of economic objectives there was one other point mentioned in the budget speech which is partly economic and partly political. I refer to the fact that Canada probably has the most open economy of any country in the world. This is to our best advantage. It is in our best interests, and as far as the government is concerned this will be continued. But as I said in the budget speech, there should be "full participation by Canadians in the management and direction of all aspects of our own affairs". I suspect it will not have gone unnoticed that in the budget speech this year I repeated what I said last June about the government's views and objectives concerning foreign owned Canadian subsidiary companies.
A word now, Mr. Speaker, about the economic outlook in Canada. I have already referred to the forecast of growth for 1964, to the fact that unemployment is down and employment up, to the fact that unemployment is now a regional rather than a national problem and is concentrated mainly-I referred to this in the budget speech-in eastern Quebec and the Atlantic provinces.
Apart from the incentives offered to industry to establish new manufacturing and processing plants in areas of slow growth, a

policy which I am very hopeful will bear a great deal of fruit in the next few months, the best thing that could happen from the standpoint of more jobs in eastern Canada would be an early decision to go ahead with the $600 million to $700 million development of the Hamilton falls power project. I would urge all parties concerned with this great enterprise as seriously as I can to work out their differences, if any, and to get ahead with this vitally important project.
The other day the hon. member for Nanai-mo-Cowichan-The Islands (Mr. Cameron) suggested that some people had referred to my latest effort as a Tory budget. I must say I winced when I heard that epithet. I have been called a lot of things in my day, not a few of them since I became Minister of Finance, but I cannot remember ever before being called a Tory. The fact is, Mr. Speaker, that the powerful stimulants to expansion introduced last year, the effects of which are now beginning to be felt, will continue to be felt, as I have said. Apart from this, and in the kind of economic conditions I have outlined, what other fiscal and economic policies are called for at this time?
It is quite true that there are those who advocate massive tax cuts in order to keep up with the Americans. I cannot accept this as the right prescription in present circumstances, and when I say that I mean the circumstances of mid-March, 1964. If at some later date the forward surge in the economy should show signs of faltering, that would be another matter. But there are no such signs on the horizon now.
Many hon. members have made useful contributions to the debate, although for the most part they seem to have more or less cancelled one another out. I should like to mention two things that were said, the first by the hon. member for Springfield (Mr. Slogan). He suggested that in order to give vitality to this country we need the vision of 1957. My recollection of the vision, or nightmare, depending on how you like to refer to it, is that it was followed by high average unemployment-in 1958 of 7.1 per cent; in 1959 of 6 percent; in 1960 of 7 per cent and in 1961 of 7.2 per cent. It was followed also by two exchange crises. During that period the whole Canadian economy was in the doldrums.
We now have falling unemployment-


Mr. Maclnnis:: May I ask the minister a question?


Walter Lockhart Gordon: Yes.


Donald MacInnis: The minister has given us the figures up to 1962; would he now tell us what he said about the devaluation of the Canadian dollar in 1962?
The Budget-Mr. Gordon


Walter Lockhart Gordon: I think I was probably the first person to raise publicly the question of devaluation of the Canadian dollar in January, 1960 or it might have been February, 1960, at a meeting of the Ontario labour congress in Niagara Falls.


Donald MacInnis: Will the minister permit one more question?


Walter Lockhart Gordon: Perhaps the hon. member would make his own speech or ask me questions at the end of mine. I should like to continue.


Donald MacInnis: There is one question which I should like to ask the minister.


Mr. Deputy Speaker:: Order, please; if the minister will allow a question, it is his privilege. On the other hand, he has the floor and it is up to him.


Walter Lockhart Gordon: I will be glad to answer one more.


Donald MacInnis: Did not the minister take credit for being the first to call to the attention of the Canadian people the fact that devaluation of the Canadian dollar would bring chaos to the economy of this country? I have that in writing, and it has been recorded in Hansard.


Walter Lockhart Gordon: No, Mr. Speaker.


Donald MacInnis: You are on record as saying so.


Mr. Muir (Lisgar):: This is a good time to change the subject.


Walter Lockhart Gordon: I am grateful for all advice that I get from unexpected places. I am short of consultants these days, and I am glad to find substitutes right here in the house.
We now have falling unemployment, the lowest levels since 1957, and an expanding economy. The people in my riding who now have jobs find the change to their liking, vision or no vision. They say they like this situation better than having nightmares.
The second point to which I wanted to refer was made by the hon. member for Pontiac-Temiscamingue (Mr. Martineau) who yesterday criticized the government for not cutting taxes. I wonder how he reconciles these remarks with the amendment put forward by his party criticizing the government for not balancing the budget? I am curious also to know how he reconciles his views on tax cuts with those of his colleague the hon. member for Digby-Annapolis-Kings (Mr. Nowlan) and the former minister of trade and commerce, Mr. McCutcheon, who sits in another place. These two gentlemen expressed their views at the recent Tory convention. I would be curious to know who speaks for the Conservatives on fiscal policy, whether it

Private Bills
is the hon. member for Pontiac-Temisca- Bill No. S-8, respecting the General Acci-mingue or the hon. member for Digby- dent Assurance Company of Canada-Mr. Annapolis-Kings.	Wahn.


Paul Raymond Martineau: We both do.


Walter Lockhart Gordon: They both do, Mr. Speaker. This may make it clear to some, but I find it a little confusing when they take opposite positions on this subject within a short time of each other.
The amendment we will be voting on tonight reads as follows:
This house regrets that the government has failed to take any effective action to control increasing expenditures and its failure so to do, despite increased taxation imposed at the last session, has resulted ill a substantial deficit.
I suggest to hon. gentlemen opposite that those who live in glass houses should not throw stones. It seems to me that they have had-


J.-H.-Théogène Ricard: Stop right now.


Walter Lockhart Gordon: -some experience with deficits. I cannot accept all the advice I get from the opposite side.
I may point out also that the deficit for the next year has been reduced by 33J per cent. I might point out that some items of expenditures will be increased next year, as they are in all years. Perhaps when hon. members think about this, they might like to know what items will account for most of the increases. There will be about $34 million extra spent on family allowances; about $58 million increase in payments to the provinces; $50 million more in debt charges; $35 million increase in the amount payable for hospital insurance; $25 million more for external aid. The cost of the trans-Canada highway program next year is expected to be increased by $10 million, and $18 million will be spent in connection with the Canadian corporation for the 1967 world exhibition.
I might point out also that in the current year which ends March 31, almost 60 per cent of the federal government's total expenditures is for such things as old age security, hospital insurance, family allowances and other social security benefits, as well as vocational training and grants to the provinces and municipalities.
May I call it five o'clock, Mr. Speaker?


Mr. Deputy Speaker:: It being five o'clock, the house will now proceed to the consideration of private members' business, namely private bills and public bills.



PRIVATE BILLS


[Stage Direction]
Bill No. S-9, respecting Scottish Canadian Assurance Corporation-Mr. Wahn.


[Stage Direction]
On the order:
Second reading of Bill No. C-3, an act to amend the Bankruptcy Act (wage earners' assignments) - Mr. Orlikow.
Stanley Howard Knowles: Mr. Speaker, before I request that this order stand, I wonder if I could ask the Solicitor General if arrangements might be made some time soon to refer the subject matter of the various bills that are to go to the consumer credit committee to that committee? I am not asking that it be done today, because we have to pick out which ones are to be dealt with in that way. This is the reason we keep asking that some of these bills stand.


Hon. J. Watson MacNaughi (Solicitor General):: In reply to the hon. member for Winnipeg North Centre I wish to state that in a day or two we shall go over these bills and the subject matter of any having anything to do with consumer credit will be referred to that committee for further study.



CRIMINAL CODE


Reid Scott: the second reading of Bill No. C-12, to amend the Criminal Code (capital punishment).
He said: The purpose of this bill, second reading of which I am now moving, is to amend the Criminal Code so as to abolish hanging as a penalty for the crime of murder.
Hon. members will notice that I have deliberately not touched upon the subject of treason because for the purpose of discussion this afternoon I wanted to try to limit the debate to the question of hanging as a penalty for the crime of murder. This is a subject upon which debate has raged back and forth for many years. People on either side of the controversy have, I think, held their views with sincerity and conviction and I suppose that no matter what happens to this bill the subject will always be one of which there will be deep differences of opinion among the population.
Those who read Hansard will have observed that the last great debate on this subject took place in 1961 when several days were devoted to a discussion of the matter. I think anyone reading the report is bound to be impressed by the fact that these debates

are probably among the finest to be found in the pages of Hansard. The question we really have to decide this afternoon is, it seems to me, a fairly simple one, namely is hanging an effective deterrent to murder or is there another deterrent which is just as effective and not so drastic? In my few remarks I hope to be able to demonstrate to the house that the penalty of capital punishment cannot be justified upon logical grounds and certainly not on moral grounds, and that there are other deterrents which are just as effective, though less drastic. I should like to divide my argument into two parts. First, I should like to examine briefly the case in favour of retaining capital punishment and, second, to discuss the arguments put forward in favour of its abolition.
The only real argument of substance which is advanced in favour of retaining capital punishment is based upon what is called the theory of deterrence. This is the theory that potential murderers will stop to consider the consequence of their action; that they realize that if apprehended and convicted they will be hanged, and that this will deter them from committing murder. An examination of the evidence in jurisdictions where capital punishment has been abolished in no way supports this theory.
Hon. members will be interested to hear of some of the countries which have abolished capital punishment and the years in which they decided to do so: Holland, 1860; Denmark, 1892; Norway, 1876; Sweden, 1919; and West Germany. There are a host of European and Scandinavian countries which abolished the death penalty before 1900. But in these five particular cases where the penalty has been out of use for about a hundred years it is interesting to compare the murder rate with that of Canada. The latest statistics indicate that the murder rate in Canada is about 1.2 per 100,000. In Holland, the rate is .04; in Norway, it is .05; in Sweden, .08; in Denmark, 1.00 and in West Germany, 1.2. These are, for the most part, jurisdictions where the death penalty has been abolished for about 100 years and in every case except one the murder rate is lower than it is in Canada, while in the remaining case it is no worse.
The figures in the United States are of some assistance. In six states of the United States which have abolished the death penalty, the figures for 1958 indicate that the murder rate was 1.83 per 100,000. In the 42 states which retained it, the murder rate was 7.04. Again, the available statistics indicate that capital punishment has no deterrent value at all. In New Zealand, between 1946 and 1950 when the death penalty was not in existence, the murder rate was 6.7 per 100,000. In 1956,
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when it was reintroduced, the murder rate rose to 8.7. Hon. members can examine any jurisdiction they please. They can take any group of 40 or 50 countries representing both industrial' and rural societies, both developed and underdeveloped nations, or having different levels of education, and still any evidence which is available will indicate that the incidence of murder bears no relationship at all to the existence or non-existence of the penalty of capital punishment.
In any event, the death penalty is very rarely invoked. In the United States, where there are 7,000 murders every year, only some 50 murderers are executed. What is the deterrent value of a penalty which is so rarely invoked? Again, the death penalty is highly discriminatory in its nature. Those most likely to die are the poor, members of minority groups, the unintelligent and the friendless. The warden at Sing Sing who accompanied 149 men to the death chamber reported that in every case they were men who had no money. More than half of all those executed in the United States are Negroes.
The death penalty does not even begin to deal with the vast majority of murders classified as family murders-cases where a wife murders her husband, or the husband murders his wife, or one of them murders the children. The amendment to the Criminal Code introduced in 1961 tried to deal with the subject and it seems to me it is time for us to go all the way and abolish the death penalty completely.
The only real advocates of capital punishment are the police, who claim it is a deterrent to planned murders. In this regard, the death penalty certainly did not prevent the most infamous planned murder of our generation-the murder of President Kennedy. This was a murder carefully planned in advance and there is no evidence that there was any deterrent value at all in the fact that the state of Texas retains the death penalty.
In 1962, Ronald Turpin and Arthur Lucas were hanged in my own city of Toronto. The next night, in the shadow of the jail, a man was stabbed to death. As I have said, all the evidence indicates that the death penalty as a deterrent to murder is completely ineffective. Some have argued that it provides protection for the police. If this were so, there might be some reason for retaining it. The only comprehensive study made in this regard was conducted by the University of Pennsylvania. The chiefs of police of some 10,000 towns reported on cases of murder in which the victims were police officers, and an analysis showed no difference whatever between the positions of states which had

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retained the death penalty and states which had abolished it. Some police officers here claim that the existence of the death penalty for murder keeps criminals from moving into their jurisdictions. It seems to me that this contention cannot stand up, because if criminals in the United States wish to move into jurisdictions where there is no death penalty, they have six states of their own from which to choose. Others contend that the loved ones and relatives of a murdered person suffer and that the dependants of the murderer, the people left by him, should therefore suffer, too.
But surely, Mr. Speaker, the care and attention to be devoted to the families of those who are murdered can be better handled through compensation funds and other measures which could easily be devised. The final argument-and it may have some merit-is that public opinion is not prepared to support the abolition of capital punishment. In this regard it is significant that over the years the number of people in Canada who are in favour of retaining the death penalty is steadily declining. I believe the latest figures, taken in 1962, showed that only 47 per cent were still in favour of retaining it. Also it seems to me that in the area of social reforms it is highly necessary that our governments not just follow public opinion but lead it; that our governments should give leadership in areas of reform, rather than wait until a majority of the population want something and then turn around and agree with them.
I think the most important statement in this regard was made by Sir Ernest Gowers who served as chairman of the royal commission in the United Kingdom in 1949. He said as follows:
Before serving on the royal commission I, like most other people, had given no great thought to this problem. If I had been asked for my opinion, I should probably have said that I was in favour of the death penalty, and disposed to regard abolitionists as people whose hearts were bigger than their heads. Four years of close study on the subject gradually dispelled that feeling. In the end I became convinced that the abolitionists were right in their conclusions-and that so far from the sentimental approach leading into their camp and the rational one into that of the supporters, it was the other way about.
So I suggest that when one examines any of the arguments in favour of the retaining of capital punishment, they cannot stand up on any logical grounds.
My time is limited, Mr. Speaker, and I want to pass very quickly to the arguments in favour of abolition. The first argument, of course, in favour of abolishing the death penalty is that all arguments in favour of retaining it do not stand up unless we are prepared to admit that the real motive is revenge; and if that is the case, we have not
IMr. Scott.]
really progressed very far from the day when our ancestors dressed in leopard skins and chased each other around with clubs. The other argument against retaining capital punishment, of course, is the impossibility of rectifying a mistake, because the dead cannot come back to life. I know there are safeguards in our jurisprudence

we are all aware of them-but our jurisprudence is administered by human beings, not by calculating machines, and mistakes do occur and there are cases of innocent people being convicted. I have in my hands a book by Judge Jerome Frank in which he outlines some 36 cases of innocent people who were convicted. In the case of those who were executed, the interest in their case dies when they are executed because there is nobody to be released in any event. I spoke last session of the Coffin case. I do not intend to repeat here the arguments I advanced at that time, except to say that if ever there was a case that called for the abolition of capital punishment, it was the case of Wilbur Coffin. We shall await with great interest the deliberations of and the result and report of the royal commission.
Also, Mr. Speaker, capital punishment rules out any hope of rehabilitation of the criminal. Recent studies that have been conducted in forensic psychiatry have indicated that in many cases rehabilitation can take place. There is an interesting study of a young convict in Chicago who was convicted of murder and sentenced to death and whose execution was postponed for eight years. At the end of the eight years the governor of the state commuted his sentence to life imprisonment because this man had been completely rehabilitated. It was stated that to take his life would not be punishment but would only be retribution. As I have said, Mr. Speaker, capital punishment rules out any hope of rehabilitation. Life imprisonment, where it has been tried and where statistical evidence is available, has proven to be just as effective a deterrent as hanging in cases of murder.
It has been said by some that this has not been a particularly distinguished parliament. We have been subject to a great deal of criticism, some justified and some unjustified; but it seems to me that in this bill we have a chance to take a great step forward; to take action that would be heard around the world should we decide to take a forward and progressive step and abolish capital punishment.
Mr. Speaker, my time is running out and I do not really have an opportunity to go into the final problem of capital punishment, which is the whole question of morals and ethics; to what extent the state has the right to take a human life, under any circumstances. Every time we have a hanging in Canada, this country

undergoes a sort of crisis of conscience, where a man waits to die and the whole nation debates whether or not he shall die; and it usually resolves into a tug-of-war between the primitive passion of revenge and the civilized idea of compassion. We kill, I think, largely from revenge. I think we kill because we fear, not because we think these people are beyond rehabilitation. I think we kill in the blind and futile hope that others will not repeat the crime. I think we do it because we do not yet understand that murder has its roots in the ills of our society, poverty and ignorance, lack of opportunity and all the other ills with which we try to deal in this parliament. I think we do it because as yet we do not really respect human life.
The ministry of justice in Belgium-where their last execution was 100 years ago-put it this way:
The lesson has been learned that the best means of inculcating respect for human life is to refrain from taking it even in the name of the law.
I wonder to what extent a society that takes human life can invest its citizens with respect for human life. These, as I say, are arguments that would take a great deal of time to develop; they are matters of conscience. However, I hope that some day we shall have a chance to deal with them in this chamber. In summation, Mr. Speaker, I merely want to reaffirm that the arguments of the deterrent effect, protection of the police, etc., are not borne out by any available statistics that I can find; that the case in favour of the abolition of capital punishment has never been refuted on anything but opinion evidence; that as far as I can see, and on all the evidence, life imprisonment, where it has been tried, has exercised the necessary degree of effective deterrence.
Therefore in conclusion I merely wish again to reaffirm my position. It seems to me that the abolition of capital punishment is in many ways a plea that we put our backs to the past and try to turn our faces to the future. I think we are trying to establish a regard for human life that does not exist at the present time. I think we are trying, essentially, to argue for a time when reasons of revenge and hatred do not dictate our decisions, and for a time when we can learn .somehow through reason, judgment and understanding that all life is worth saving and that compassion is the highest attribute * of our society.


Mr. Robert Temple (Hastings South):: Mr. Speaker, since the earliest days of civilization men have been concerned with capital punishment and its effects on the aggrieved
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person or persons, the criminal and the community as a whole. Today I become one of those who have given some thought to capital punishment and its social effects. Crime or criminology has only recently become a science of which we know much, or rather have studied as such.
In the days when Babylon was at the height of its prominence the generally recognized and accepted law was that in all criminal matters the maxim of "an eye for an eye and a tooth for a tooth" should prevail. Today such a rudimentary concept fills us, or should fill us, with alarm and yet as history, and supposedly civilization, advanced we find that this old maxim "an eye for an eye and a tooth for a tooth" has not only remained but has become worse. The Romans punished parricide by sewing the condemned in a sack with a dog, a cock, a viper and an ape and casting all into the sea or river. In eighth century England all laws made distinction between different classes of men, not only between slaves and free men but between different classes of free men, and all laws assumed that the family bore a share of responsibility for the wrongs done by its members and was entitled to some compensation for wrongs suffered by kinsmen.
In plain English the effect of the eighth century Anglo-Saxon procedure is this. A man accused of assaulting a fellow citizen needed the good opinion of the village to get off. If he had it, he would not be convicted; but if he committed his crime against the lord of the manor, then he only got off if he had sufficient testimony from the other local land owners. If the accused person persisted in his protestations of innocence and did not have the good opinion of his fellows, he had to submit to ordeal. The ordinary ordeals were by water or fire-a hot iron weighing one pound had to be carried, or the arm plunged up to the wrist in boiling water. For a threefold ordeal the weight of the iron was three pounds, or the arm had to be put in up to the elbow. The hand was then bound and sealed up and kept bound for three days. If, after three days, the hand showed raw flesh the man was guilty. If the hand healed he was innocent.
These ordeals were accepted by eighth century England. It is reported a great number of convictions were obtained, almost as many convictions perhaps as would have been the case under the proposed bill no. 99 in the Ontario legislature, whereby accused people would be denied legal counsel, habeas corpus would be removed, Magna Carta done away with, and people put in jail for days on end and kept there if they failed to answer

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questions. It has been said that this bill no. 99 would apply only to selected persons, but I hate to think who the selected persons might be. I do not know whether they would have been Liberals first of all or who they might have been, but being a little bit selective is a dangerous thing, like a little bit of something else which I am sure the hon. member for Edmonton West (Mr. Lambert) is thinking about now.


Mr. Lambert:: What about west coast
Japanese?


Anthony Robert Temple: Fortunately bill no. 99 was K.O'd. in the second round. Cassius Clay, the world heavyweight champion, took seven rounds to win the championship, but it just goes to show that many a Cassius has feet of clay-and here I am referring to the proposed bill no. 99.
Then 900 years later in the 17th century in England we might logically suppose that men were much more enlightened than their forebears of the eighth century. Yet we find that in 1650 an act was passed in England punishing adultery with death, and this savage penalty was actually inflicted in two or three cases. After that even puritan juries refused to convict and the law was set aside as unworkable. This was rather remarkable, in that history shows us that it usually take a long time for legislatures to change a criminal law which is not supported, nay is even despised, by the majority of the people.
People in the seventeenth century or in the eighth century were no less intelligent than people of the twentieth century. Rather, the power of traditional thought was very effective in keeping men's minds closed to the facts which were not in accordance with traditions. Previous to the time of William Harvey, whose work was done early in the seventeenth century, the ablest and most intelligent persons had no proper concept of the circulation of the blood. They believed the arteries were filled with air. Harvey's findings gained very little headway during his lifetime and were contradicted most strenuously by scientific men. This was due again in a large part to that tradition of thought of which I have spoken.
It is not my intention to be maudlin in describing the various tortures and punishments inflicted in England, but I feel that we must look at these punishments in order to grasp the change in men's thinking. Of course, when I say men I mean both sexes, and it may be that a large credit for the reforms that have been made are due to the influence and innate gentleness of the female sex.
In 1530 an act was passed in England which prescribed boiling alive for certain convicted persons. Burning alive was another penalty

for a certain number of crimes and lasted until 1790, only 174 years ago. From 1525 until 1550 it is said 72,000 executions were performed in England. Nevertheless crime increased and during the eighteenth century the criminal code of England contained 240 different capital offences. At the dawn of the last century death was a penalty for such misdemeanours as unlawfully killing, hunting or stealing deer, unlawfully killing or netting fish out of any pond, cutting down or destroying someone else's trees, sending threatening letters; and, of course, thefts of over five shillings from a shop or over 40 shillings from a private house were also punishable by death.
From time to time men have protested against these outrages. One such person was Cesare di Beccaria, a Milanese nobleman whose book "Crimes and Punishment" published in 1764 denounced torture and established a basis for a scientific treatment of criminology. This book was a tremendous sensation among enlightened people all over Europe. However, Beccaria was denounced by his critics-and they were many-as a fanatic, an impostor, a fool, a madman, and was charged with having sought to endanger governments and seduce the public; while torture was upheld by these critics as a benefit and a mercy to a criminal by purging him in his death of falsehood.
Due to the efforts of such men as Beccaria, we have in Canada at the present time but three offences punishable by death. They are treason, murder and piracy with violence. However, let us look at and study carefully the death penalty. It can be attacked on several grounds. I propose to deal with it on the grounds that it fulfils no useful function and that it will be remembered by future generations with a sense of loathing and incredulity. The argument is put forth that fear of the death penalty is a major deterring influence on the crime of murder. Yet in those countries and states which have abolished the death penalty for murder there has been no increase in the crime. My hon. friend from Danforth (Mr. Scott) gave a very learned discourse a few moments ago in this house on this very matter. Neither has there been a lessening of this particular crime. The only logical conclusion at which we can arrive is that fear of the death penalty is no effective deterrent.
It is also argued that it prevents the repetition of the same crime by the same person. I shall quote the late Warden Lewis E. Lawes of Sing Sing prison. These extracts from his book "Life and Death in Sing Sing".
The argument that capital punishment is necessary for elimination of murder is faulty: It must

not be forgotten that the death penalty has been tried before on a colossal scale, judged and found wanting.
The further assumption that the murderer is a dangerous criminal from whom society must be protected by hanging or capital punishment is flatly disproved by the figures which show that 90 per cent of the men and women convicted for murder had no previous felony record whatsoever.
Finally Warden Lawes asks this question:
Is it necessary to kill a murderer? It is surely not a deterrent example to perform an act furtively. If the state really believes that execution is necessary to deter others, it should execute openly and unashamed. Does not this furtiveness carry the suggestive thought that the spectacle of legalized killing by the state breeds on the part of the unthinking mass a hardened outlook towards murder which is harmful rather than effective as a deterrent?
It may very well be that my thoughts and feelings toward capital punishment are not shared by the majority of Canadians who approve of capital punishment and believe it is right. That a thing is widely believed is no guarantee of its truth. For a much longer time than the present view has prevailed, it was universally believed that the sun moved around the earth; the whole world believed in the existence of witches, and up until the time of Columbus the prevalent belief was that the world was flat. Therefore the fact that belief in the desirability of capital punishment is both widespread and of long standing is not by itself a guarantee that it is the true solution. We have seen that savage punishments have neither reformed the criminal class nor acted as a deterrent for the future.
There was something which was brought to my attention yesterday that might be of interest to this house. It was a decision of the Supreme Court of Canada which voted on a split decision, if I may put it that way, that an accused person from Quebec, who had been condemned to death at his original trial and who subsequently had his execution sentence set aside by the court of appeal of the province of Quebec which ordered a new trial, be now executed, and that the decision of the Quebec appeal court be set aside. This was by a majority decision of six to three in the Supreme Court of Canada.
I submit that when there is, for whatever reason, anything less than a unanimous vote in a court of appeal or in the Supreme Court of Canada on a matter affecting a man's life, that man should not be executed and instead should at least be sentenced to life imprisonment. I ask the government to take note of this in any amendments that may be proposed to the Criminal Code.
I believe that the legislation enacted some three years ago was a step in the right direction, providing for two classes of murder, capital and non-capital. We have had three
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years experience of that legislation and, so far as it goes, it has worked very well. However, I would ask that the government study this very carefully over the next year or two in the hope that it will then say there will not be two classes of murder, that there will be only non-capital murder, and that the penalty will be life imprisonment, as suggested in this very excellent bill presented by the hon. member for Danforth (Mr. Scott).


Mr. Guy Marcoux (Quebec-Montmorency):: Mr. Speaker, although I am not a lawyer or a legislator, I am nevertheless interested in this matter and I should like to say, to begin on a humourous note, that capital punishment should be abolished, at least in the case of bills presented during the hour for the consideration of private members' business, thus permitting us to adopt some of them once in a while.
I suggest we proceed most cautiously regarding abolishment of capital punishment and that we consider seriously every reason invoked in favour of it.
I agree that capital punishment may not be the deterrent we think it is, that it does not constitute a protection for police officers and that it cannot become an instrument of revenge against an individual. I admit that we must provide some social reforms, one of which would be the abolition of capital punishment.
Besides when it has become an accomplished fact, there will still be cases where, for the public safety-and not necessarily that of the policemen since it is their job just as it is the firemen's job to put our fires, even at the risk of getting burned-we will have to find more adequate means of protecting the people.
I still recall that famous case to which I have often referred here-and you could even say that I am obsessed by the idea- that of Dion who was sentenced to several years in the penitentiary and while the judge recommended that he should not be allowed to leave it for reasons which are still unknown, in spite of the numerous questions directed to the Minister of Justice, Dion managed to be released legally through the parole board. Once free, he lost no time in committing murders.
That is what I have in mind when I say that the law must still be made to protect the people. If someone is sentenced to jail for life, there is nothing to prevent him, after ten, 20 or 25 years of perfectly good behaviour, from being paroled, returning to live in society and committing another murder.
It is claimed that we have no right to deprive somebody of his life. But, before a

Criminal Code
murderer is sentenced to death, would it not be more logical to give an accurate definition of a real murderer, a killer capable of committing a premeditated murder, and a sick person suffering from mental illness. In my opinion, mentally unbalanced people should not be given a death sentence. They should be treated, or at least some kind of treatment should be tried in their case. On the other hand, life sentences are not given those who are capable of deliberately committing a premeditated murder, in order to enable our laws, not to satisfy any desire for revenge, but to ensure the protection of our people who can always expect to see that individual come out again.
As a deterrent, it has been alleged that a life sentence is similar to a death sentence, except that, in the latter case, the individual will never have any chance of returning to society.
Mistrials have also been mentioned, but they are certainly not a result of death sentences, but rather of loop-holes in our laws. Now, I think that legal means should be taken in order to avoid any possible mistakes. But there is definitely no relationship between capital punishment and mistrials.
In those very few cases, those convicted as a result of a mistrial, as the hon. member for Hastings South (Mr. Temple) pointed out, should be convicted only on complete unanimity. I maintain that when both lawyers and psychiatrists are unanimous in finding someone guilty of premeditated murder, with full knowledge of the facts, capital punishment should be maintained in order to protect the people.
Earlier, the hon. member for Hastings South said that many things have changed since the early days when it was said: "an eye for an eye and a tooth for a tooth". In that respect we know-and I recall it especially since it is Holy Week.-that when our Saviour came among us, He said: from now on, it will not be "an eye for an eye or a tooth for a tooth" but "whosoever smite thee on thy right cheek, turn to him the other also" which means that we have to forgive one another and live by charity and love only. He said that we must forgive often, that we must forgive seventy times seven, meaning that we must always forgive one another. But, just the same-He even let himself be sentenced to death following a charge, a political trial, in short for various reasons which, in our opinion, did not warrant the death penalty. But he accepted that fate to show that, in future, capital punishment could be contemplated in some cases; otherwise, I feel He would have refused it himself.

Before ending my remarks, I would like to add that the hon. member for Hastings South says that something is not necessarily true because most people accept it. We have been saying that for a long time too, we have been saying that the present economic system is not good but, in spite of that, everyone still thinks that it cannot be changed. It is still a good argument.
We favour the abolishment of the death penalty, but until it can be established without any possible doubt that an accused was not entirely sound of mind or that he had not fully premeditated his murder, I feel we must leave in the criminal code a provision to protect the public against true criminals.


David Réal Caouette: Mr. Speaker, the question raised in Bill C-12 with respect to capital punishment is certainly a much debated one throughout Canada.
Some people claim that capital punishment must be maintained and others state that it should be abolished.
Moreover, if we consider section 75, paragraph 1 of this bill, we see that there is not much change as compared to what existed previously.
I quote:
(1)	Everyone commits piracy who does any act that, by the law of nations, is piracy.
Now, what is suggested in Bill C-12 is exactly the same thing as in this paragraph 1.
But it is paragraph (2) that this bill would change, and paragraph (2) read previously as follows:
(2)	Everyone who commits piracy while in or out of Canada is guilty of an indictable offence and is liable to imprisonment for life, but if while committing or attempting to commit piracy he murders or attempts to murder another person or does any act that is likely to endanger the life of another person he shall be sentenced to death.
Now, the new section, paragraph (2) says:
Everyone who commits piracy while in or out of Canada is guilty of an indictable offence and is liable to imprisonment for life.
In the explanatory notes, this is specified:
The purpose of this bill is to provide that hereafter a person shall not, except in certain cases of treason, be sentenced in Canada to suffer death for murder but that such a person shall hereafter be liable to imprisonment for life.
Now, what does Bill C-12 mean by:
"except in certain cases of treason"?
For instance, is it not treason for an individual to disguise as Santa Claus and kill two policemen in the very centre of the city of Montreal at noontime? Is it not treason to deprive children of their father and a wife of her husband? In the case of sure premeditation-because the bandit is then ready

for any eventuality-is it not treason of the Canadian community where this individual may live?
The first part of the explanatory notes reads as follows:
The 1960-61 act to be repealed has the effect of dividing murder into two kinds, capital and non-capital; and of providing death as punishment for capital murder and imprisonment for life in the case of non-capital murder.
Mr. Speaker, when it is clearly established that the murderer knew full well the seriousness of his act, I feel that he should pay with his own life for the one he has taken.
On the other hand, miscarriages of justice have been known to happen. For instance, an investigation is going on at present in the province of Quebec concerning a well-publicized case, that of Wilbert Coffin who was executed in 1956, after two or three trials and after three years of detention in jail.
And today they are trying to find reasons to exonerate or rather rehabilitate the memory of Wilbert Coffin.
Mr. Speaker, I think that the Coffin case was not clear in 1956, and many jurists readily admit it. There was no conclusive evidence that he was the murderer of the three American tourists in the Gaspe peninsula. This was not, in my opinion, a capital murder, and I feel the criminal code should be amended so as to prevent such a miscarriage of justice.
It may be that Coffin was guilty, but then maybe he was not. In such cases, the accused should be given the benefit of the doubt and not be sentenced to death. I feel that the majority of Canadians would welcome such an amendment to the Criminal Code.
But, Mr. Speaker, throughout the country, there are criminals who do not hesitate to fire on policemen, on fathers and mothers of families, on taxi drivers to steal money from them.
These days we hear more and more about hold ups. As a matter of fact, it was even said that there had been a hold up every minute in the city of Montreal recently during almost a whole night. Those are the hold ups that are reported. What about those which are not?
I feel that there must be a way to improve the situation, and it is not by reducing sentences that we will prevent people from stealing or engaging in hold ups or having the nerve, the audacity to kill anyone they find in their way.
Mr. Speaker, the hon. member for Hastings South (Mr. Temple) pointed out to the house a short while ago that we no longer live in the middle ages or in ancient or primitive times.
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But, even if we are living in modern times, we must be cautious and know where we are going before proposing the abolishment of a punishment which in certain cases certainly proves to be the best.
When we see people die in such a way, even friends in certain cases, I can assure you this makes one think twice about the advisability of abolishing capital punishment.
Mr. Speaker, this bill and other similar ones have been introduced here for a number of sessions. Life sentence has been suggested rather than capital punishment. To deprive someone of freedom for a lifetime, I wonder whether it is more Christian and more modern than to punish him according to what he deserves, according to the seriousness of the act he committed.
We consider only whether a murder is capital or non-capital to determine exactly if capital punishment should be maintained or not. I feel that capital punishment should be maintained for capital murders. In addition, as suggested earlier by the hon. member for Hastings South, legal proceedings should be more thorough so as to establish exactly the seriousness of the offence committed.


Mr. Hubert Badanai (Fori William):: Mr. Speaker, the hon. member for Danforth (Mr. Scott) is to be commended for bringing this important matter to the attention of parliament again. The reason I have risen to speak in this debate is that I have taken part in previous discussions of this subject, notably on the several successive bills which were presented and moved in the house between 1958 and 1962 by the former member for York-Scarborough, Mr. Frank McGee. I spoke on those occasions and I propose to speak now in support of the principle of abolition of capital punishment. After each occasion in the past when I expressed my views against capital punishment I received letters from my constituents and others both for and against the retention of the death sentence, with the number favouring abolition on the increase over previous years.
Undoubtedly, the general feeling swaying toward abolition had the effect of influencing the previous government in the introduction of Bill No. C-92 in May of 1961, the passing of which had the effect of dividing murder into capital and non-capital categories. I think this was a step in the right direction.
The Globe and Mail devoted an editorial to commenting on the passage of Bill No. C-92 in 1961, and concluded with these words:
The new amendment will reduce the number of cases in which the government is required to exact the extreme penalty or to interfere with the law,

Criminal Code
but they do not answer the moral question: Should society kill any man, whatever his or her crime?
This issue, however, is still between two schools of thought, one thirsting after justice in a mood of vengeance and the other urging the practice of Christian charity and the rehabilitation of criminals. Mr. Kirkpatrick, an executive director of the John Howard Society for Ontario, speaking on deterrence, had this to say:
The belief behind deterrent punishment is that behaviour can be controlled by fear; therefore, the argument goes, severe treatment of a criminal is effective in two directions at once: It deters the criminal himself from committing another crime and, by the example of his punishment, it deters others from wrongdoing.
Notable figures in the religious life of this country have gone on record as being in favour of abolition, Still others have expressed opinions to the contrary, holding to the belief that fear of the death sentence is a restraining force against murder. Personally, I share the views of those who believe that there is no valid guarantee that the fear of punishment by death is a definite deterrent.
Consider the proportion of murders committed in circumstances of sudden passion which are not deterred by threat of consequences and consider also crime such as robberies, from which murder might result, which are deliberately planned to avoid detection. Consider also the risk of executing an innocent person.
May I cite as an example the case of a man by the name of Evans, who was hanged in London for the murder of his wife and child in 1949. Five years later a man by the name of Christie, who lived in an apartment in the same house as Evans, was arrested and convicted of having murdered several women including Mrs. Evans, for whose murder her husband was hanged five years before. Consider the case now under investigation known as the Coffin case in the province of Quebec. There are others that could be cited.
The debates on capital punishment during 1959, 1960 and 1961 revealed the tremendous interest in this subject which the whole country shared. It was a practical demonstration of the feelings of the people on the matter which were, for the most part, still divided. Those who still favour the retention of the death penalty for crimes involving murder believe that death is the only effective deterrent against murder. While I respect the views of those who hold the opinion that the death sentence is a restraining force against murder, the experience of nations,

including the United States to the south of us, is such that it does not bear out this contention.
The hon. member for Danforth (Mr. Scott) mentioned some of the nations that have abolished capital punishment. I could add Belgium to that list, which abolished capital punishment in 1863; Luxembourg in 1822; Portugal in 1867; the Netherlands in 1870 and Italy in 1890. The death penalty was restored in Italy during the fascist regime but was abolished again in 1948. The northern states south of the border might also be included, and this is not a complete list by any means.
I should like now, Mr. Speaker, to read an extract from the report of the royal commission on capital punishment in Great Britain in 1949. At page 53 of the report the commission said:
Capital punishment has obviously failed as a deterrent when murder is committed. We can number its failures. But we cannot number its successes. No one can ever know how many people have refrained from murder because of the fear of being hanged. For that we have to rely on indirect and inconclusive evidence. We have been told that the first thing a murderer says when he is arrested is often, "shall I be hanged" or, "I did it and I am ready to swing for it" or something of that kind. What is the inference to be drawn from this? Clearly not that the death penalty is an effective deterrent, for he has not been deterred; nor that he consciously considered the risk of the death penalty and accepted it; still less that the death penalty was not so effective a deterrent as some other punishment might have been. The true inference seems to us to be that there is a strong association between murder and the death penalty in the popular imagination.
I see that the time is getting short, but I should like to say that I do not propose that the government should bring in a bill to a divided parliament, on a subject about which there is divided opinion in the country. I am in favour of letting this question come to a free vote eventually, and letting every member vote according to the dictates of his or her conscience.


Some hon. Members:: Question, question.


Hubert Badanai: The retention or the abolition of capital punishment is not a subject of government policy or party line. This is an emotional subject, Mr. Speaker, and one of religious conviction, overriding any and all political considerations.
I believe it is six o'clock.


The Acting Speaker (Mr. Batten):: It being six o'clock, the hour for the consideration of private members' business has expired.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 8 p.m.


[Stage Direction]
The house resumed consideration of the motion of Hon. Walter L. Gordon (Minister of Finance), that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Nowlan.
Walter Lockhart Gordon: I am sure I speak for all hon. members when I express our grateful thanks to the hon. member for Assiniboia (Mr. Watson) for supplying us with this souvenir, as he puts it, or symbol, of Saskatchewan. I think we are all pleased, too, that it is no longer necessary to dispose of the great product of the farms of Saskatchewan in this somewhat retail maner, and to think that nowadays this sort of stuff is being shipped in large quantities to people all over the world who need it very badly.


An hon. Member:: This sort of stuff?


Stanley Howard Knowles: What grade is it?


Walter Lockhart Gordon: With great respect to the hon. member for Winnipeg North Centre (Mr. Knowles) who is an expert in many things, I made some inquiries as to the grade of this product a minute ago from someone who really knows, and he said is was either grade two or grade one. It could be grade one, but he thought it was grade two.
Just before five o'clock I said that almost 60 per cent of the total expenditures of the federal government for the current year, that is the year ending March 31, 1964, is on such things as old age security, hospital insurance, family alowances and other social security benefits, debt charges and such items as vocational training and grants to the municipalities and to the provinces. I should like to remind hon. members in a little more detail of the breakdown of federal government expenditure for the year ending March 31, 1964. Old age security payments will amount to $809 million or 11 per cent of all estimated government expenditure for the current year. Hospital insurance, family allowances and other social security benefits amount to $1,152 million or 15 per cent of the total. Veterans benefits come to $266 million, or 3 per cent of the total, and public debt charges for the current year to $991 million, or 13 per cent; vocational training and grants to universities account for $165 million, or 2 per cent; grants to provinces and municipalities, including payments in connection with the trans-Canada highway, to $332 million, or 4 per cent
The Budget-Mr. Gordon of the total, and other grants, contributions and subsidies account for $770 million or 10 per cent, making a total in this particular category of items of $4,485 millions which accounts for 58 per cent of the total expenditure.
Expenditure on defence amounts to $1,699 million, or 22 per cent, accounting together with the items just mentioned for 80 per cent of the total. Capital expenditure stands at $225 million, or 3 per cent of the total and the cost of administration, operation and maintenance, including transportation, research and other government services, amounts to $1,292 million or 17 per cent of the total, the total being $7,701 million.
It will be noted that 58 per cent of the total expenditure this year is devoted to-social security benefits and the other items I have mentioned. If defence expenditures are added, we get a total of almost exactly 80 per cent of all government expenditure for 1963-64. This leaves a balance of about $1,500 million, or 20 per cent of the total, to cover capital expenditure and the administration, operation and maintenance of government services including, as I have said, transportation, research and all other government services.
I suggest that those who advocate a reduction in expenditure should say what they have in mind. We hear a lot from certain editorial writers about the desirability of balanced budgets. At the same time, the same people-and I might include the hon. member for Pontiac-Temiscamingue (Mr. Mar-tineau) among them-usually advocate tax cuts. Should one ask them how the federal budget can be balanced if taxation revenues are reduced, they usually say, somewhat airily, that the proper thing to do is to reduce expenditure. Then they stop. Very few of these people are prepared to state which expenditures they would like to see reduced.
The New Democratic party did this in its subamendment. Members in that group said they would cut defence expenditure. I ask: Is this what the Conservative party has in mind? Or would hon. gentlemen opposite have us cut down social security or veterans benefits? One hon. member opposite said something about "wasting all this money". Let them state clearly just what they would do, or what they would have us do.


William Heward Grafftey: You said you were going to do it.


Walter Lockhart Gordon: The other day, Mr. Speaker, the Conservatives moved an amendment to the throne speech criticizing the government for not extending family allowances. As the hon. member for Medicine Hat (Mr. Olson)

The Budget-Mr. Diefenbaker pointed out on March 19, it enough hon. members had voted for that amendment, the government would have been defeated, and this would have made certain that there would have been no extension of family allowances at least until after another general election.


Some hon. Members:: Oh, oh.


Michael Starr: This is a powerful speech.


Walter Lockhart Gordon: You really cannot have it both ways. I might say, Mr. Speaker, another general election which, we are led to believe, the great majority of Canadians do not want.


William Heward Grafftey: Did they want the last one?


Eric Alfred Winkler: Who forced the last one?


Walter Lockhart Gordon: I suggest, Mr. Speaker, that if enough hon. members vote for the amendment now before us, it will have the same effect; the government will be defeated, if enough hon. members vote for this amendment-


Some hon. Members:: Hear, hear.


Walter Lockhart Gordon: -and the government's proposal to extend family allowances for 16 and 17 year olds who remain in school will also be defeated.


Some hon. Members:: Oh, oh.


Walter Lockhart Gordon: Let us make no mistake about this.


Gordon Minto Churchill: Social Credit are getting nervous.


Walter Lockhart Gordon: The Conservative amendment is a vote against the budget; therefore it is a vote against extending family allowances.


Some hon. Members:: Oh, oh.


Mr. Crouse:: Same old bunch.


An hon. Member:: Who wrote that for you?


Walter Lockhart Gordon: I hope that all hon. members will consider this very carefully before the vote tonight.


Michael Starr: What a childish speech.


John George Diefenbaker: Mr. Speaker, I do not think I have ever known the Minister of Finance (Mr. Gordon) to be in more humorous vein than he has been this evening and this afternoon. Under normal circumstances the hon. member for Queens would have spoken. That was the arrangement. It was only when the Minister of Finance chose to make some references to the Leader of the Opposition that I felt constrained to say a few things that otherwise might have been left unsaid.
What I intend to do, as far as I can, is cover the various matters that the minister dealt with in his second budget speech. We

are getting used to this, Mr. Speaker. Last year we had the budget; then we had the revised version; then we had the revision of the revision. I felt sure, when he rose today, while I could see nothing in the budget he presented that would require him again to retreat, he must have found something that would enable the government to maintain that record of fiscal irresponsibility they have shown since taking office.


Some hon. Members:: Hear, hear.


John George Diefenbaker: As I listened to the delivery of the budget only a few days ago I was reminded of those immortal words of the Prime Minister (Mr. Pearson) delivered on April 23 last, when he pledged Canadians in the following words:
A time to excite the daring, to test the strong and to give new promise to the timid.


An hon. Member:: He was talking about the Minister of Agriculture (Mr. Hays).


John George Diefenbaker: That was almost ten months ago. During the supper hour I naturally gathered together a few notes, and I found that the Minister of Finance on February 14 gave the country as a whole an insight into the budget that he was going to produce. I find this report in the Windsor daily Star, in an article by Mr. Maurice Jefferies:
As he was entering the cabinet meeting Thursday the finance minister was asked to comment on this week's Ontario budget. All he would say was that he was working on his own budget.
Then this appears in quotations:
"And it will please everybody".
That was a couple of months ago. What of this budget? Well, Mr. Speaker, it indicates a government that has run out of ideas and programs.


An hon. Member:: They never had any.


John George Diefenbaker: They have not been the same since the 60 days of decision. Then they ran so fast and in so many directions that they have been out of steam ever since. It has been one of the most unusual revelations these last few months to watch a government that was so full of promise during the election campaign. The first budget produced by the minister was a failure, and that was explained on the ground that it was the work of amateurs and self-constituted experimenters. The second budget is a failure, although it now is the product of the hon. gentleman himself. I think of "As You Like It" and a line from that play:
An ill-favoured thing, sir, but mine own.
It has been an amazing performance. The Globe and Mail of Toronto said last week

the first budget produced by the hon. gentleman was a farce verging on tragedy. The second has been tragedy verging on farce. I intend to deal with this budget in some detail along the lines indicated by the hon. gentleman. Last June he rushed in and produced a document of which he has heard much, and which for the first time today he defended. He defended that budget as having produced results in the economy; and if the results were produced as a result of the action of the government, then I would understand that he would naturally be boasting. But I have the record here-not the record of partisanship exhibited again today by the hon. gentleman, but the record of the report of the Bank of Canada, as well as the white paper that was issued prior to the budget being produced. It is with that I intend to deal particularly. Where are the promises of yesteryear?


An hon. Member:: Gone with the wind.


John George Diefenbaker: Where are the 10,000 university scholarships? They are on the way, says the parliamentary secretary. Well, they have been on the way for a long while. In default thereof loans have been made available to the student body of Canada, provided those loans are acceptable to the provinces when they meet in the dominion-provincial conference. Indeed, the ministers themselves are uncertain in that regard. I need only refer to the fact that a few days ago the minister of whatever-it-is-


George Clyde Nowlan: Forestry.


John George Diefenbaker: Yes, the Minister of
Forestry. Mr. Speaker, I just cannot keep up with their peregrinations. He made a statement on this subject, and I would be very interested in having the Prime Minister (Mr. Pearson) indicate whether the uncertainty prevailing between ministers is an example of cabinet solidarity. This is what the Minister of Forestry (Mr. Sauve) said, as reported in Le Devoir:
During a discussion on biculturalism he clearly made it understood that the federal loan fund for students encountered strong opposition because the provinces had nothing to do in the determination of that priority.
"How can you do something for somebody when you don't even know if he wishes that you do it for him?''
There is some solid philosophy which could only have come out of the woods. The report continues:
Someone having suggested that it is only due to sentimentality that loans to students are objected to, Mr. Sauve answered back "But where was the consultation in all this?"
That is one of the things they boast of, Mr. Speaker. The other thing which the minister
The Budget-Mr. Diefenbaker boasted of today was that the government was going to bring into effect family allowances for those between 16 and 18 years of age. On February 25 last the hon. member for St. Hyacinthe-Bagot (Mr. Ricard) moved a motion in that connection, and what happened? Every one of them on the government side voted against it. They said it was wrong, that they were not going to support it. And what has happened in the intervening two or three weeks? That indicates what an opposition can do to convince a government of the error of their ways.
Now, Mr. Speaker, what does this budget mean? What items are there in it other than the ones to which I have referred? As a matter of fact the situation is this, that we have a minister who a few months ago said that what we require in ministers of finance is flexibility. Flexibility may be a great thing. There was certainly a wide degree of flexibility between the first and second budgets. Tremendous and vast changes have taken place during the intervening period. The defiant minister of last June has become the suppliant minister of the last few minutes when, as he turned to his friends in Social Credit, he said:	"Don't vote against us",
knowing in advance their answer-"with you, aye, ready", regardless of what the government does. He called upon them for assistance.
Last year he started out against the currents of orthodox financing and produced a mixture of confusion and frustration. He tried to jump over a chasm in two jumps, and he is now trying to jump back again to solid ground. You cannot say, however, that this is a government which imitates the United States, because he made very clear this afternoon that though they might cut taxes down there that would not be done here. He asked how we could cut taxes. They can be cut if expenditures are cut, but this government has increased expenditures far and above previous years.
What about their policies, Mr. Speaker? I simply want to clear up a few matters this evening. What is there in this budget for the average taxpayer? Simply $390 million more in taxation because of the budget last year. What is there for business? He quoted this afternoon from one man, but I should like him to quote the letters that condemned him. For every one which he quoted this afternoon there would have been multitudes to the contrary, and I can imagine the search which he made in order to find one in his favour. There is nothing in the budget for the wage earner, nothing for labour and nothing for the economy. What kind of a budget is this? This is a phenomenon budget. This is a budget which cannot be explained

The Budget-Mr. Diefenbaker in logic. This is a budget that simply produces the kind of speech made this afternoon -a defensive speech-because the minister was well aware that what had been produced would in no way benefit the economy.
I intend to refer to the various measures Which we brought in, to show

*


Some hon. Members:: Oh, oh.


John George Diefenbaker: Mr. Speaker, this simply underlines what has been said before, that hon. members over there have not read the Bank of Canada report and the white paper, otherwise they would not be indulging in interruptions at this time. This is a budget full of weird uncertainties. Its diversity cannot be explained by human reason or logic. As I say, it is a phenomenon budget, and I should like to deal with it in some detail. As he pictured its wonders this afternoon, with all his arguments and wealth of statistics, I could only think what a medicine man he would have made as he placed before the house and the country the benefits of those measures which we placed on the statute books, adopting them as his own. I can only think of "Old Doc Gordon's miraculous economic elixir," which he has endeavoured to make palatable to the Canadian people.
Now, Mr. Speaker, let us find out where these things of yesteryear are. He did not speak of the Canada development board. Where has that gone?


An hon. Member:: Under the rug.


John George Diefenbaker: Under the rug? Far deeper than that. This was going to be the salvation of the nation. I remember last year when he came to the house and said-I will not say with arrogance; I would call it naivete -that he was going to bring in a Canada development plan involving hundreds of millions of dollars to buy back Canada. Now he is doing everything he can to sell Canada, trying once more to sell the shares of this nation. That is why he has backtracked on taxes and given notice of the reduction from 20 per cent to 15 per cent. Where is the grandeur of that policy of last year? In respect of the 30 per cent tax which he imposed, he said that starting from that day this was going to be a tax imposed on foreigners who purchased assets of Canadian corporations in Canada. When he brought it in he said that this was going to be the greatest thing which had ever been produced. I have it in my copy of "Troubled Canada" that this was the policy of the Liberal party; that this was the policy which he sold to the leader of the Liberal party and to others.
Three days later he suspended it, and the following day he completely removed it and

we have not heard of it since. Where are the promises of "Troubled Canada"? I would imagine that that book would enjoy quite a large sale because all one has to do is read it to find out how far its author has wised up since he became a member of parliament.
He has turned away from the views he expressed in that book. He has pitched out his pet theories and espoused those things which, when the Liberal party was in opposition, it attacked as economic heresy. The Liberals attacked devaluation. They said it was wrong. They pictured 'Canada as bankrupt. They said never before had there been anything like it, but what do they do today? After having condemned, ridiculed-yes,, libelled-now they say, "I thought of it first." That was the explanation today.
I say to the Minister of Finance that he deliberately deceived the Canadian people in
1962	and 1963. He knew what he was saying, and every one of those members opposite knew what they were saying was false, but they placed before the Canadian people the idea that Canada was bankrupt.
We said devaluation would expand the exports of the country, and it did. We said devaluation would bring about the greatest tourist traffic in Canada's history, and it has. We said devaluation would assure the reduction of imports into Canada and thereby assure our Canadian manufacturers of greater opportunities, with more jobs for those who worked for them, and it has.
These are the things we stood for. What did the Minister of Finance say? I quote from him exactly what he said. I hear this was one of his statements:
There is going to be a nosedive in the dollar.
At another time he contended that the dollar was not worth 92J cents. In January, 1963, this miracle worker, this man who speaks today with the authority of experience in what he produced last year, forecast an economic slump. That was in January
1963	after Canada's gross national product had increased by 8 per cent in 1962. This person, for political purposes, falsified the facts.
The other day he pointed out-and he repeated it this afternoon-that Canada's economy had started to rise in 1961 and had continued to rise ever since. But what did he say in January 1963? I quote:
Most analysts agree that the slowdown has already started.


Some hon. Members:: Shame.


John George Diefenbaker: I say to the minister, you falsified the facts and you know it.


Walter Lockhart Gordon: Mr. Speaker, I accuse the Leader of the Opposition of falsifying the facts now, and ask him to withdraw that statement.


John George Diefenbaker: When this miracle man is faced with the facts and quotations from his own speeches all he can say with that childish attitude is, "You too."


Walter Lockhart Gordon: On a point of order-


John George Diefenbaker: 1 have got the floor.


Walter Lockhart Gordon: On a point of order-


Some hon. Members:: Oh, oh.


John George Diefenbaker: I say to the minister-


Walter Lockhart Gordon: On a point of privilege, Mr. Speaker.


Mr. Speaker:: Order. The Minister of Finance on a point of privilege.


Walter Lockhart Gordon: I have asked the Leader of the Opposition to withdraw a false statement.


John George Diefenbaker: Mr. Speaker, I quoted from what the minister said. Is the report false? I am quoting from the kind of thing that we faced in two campaigns.


Mr. Speaker:: I can say with deliberate modesty that the speeches this evening are very interesting. However, the use of the word "falsify" is pretty strong language. Sometimes it could be considered descriptive. Sometimes it could impute motives, and I take it-in fact I understand that the Leader of the Opposition is not imputing a personal motive.


John George Diefenbaker: It could not be more correct. I am simply saying that the statements made in the campaign were falsified.


Some hon. Members:: Hear, hear.


Walter Lockhart Gordon: Mr. Speaker-


Some hon. Members:: Sit down.


Walter Lockhart Gordon: Mr. Speaker, I have asked that the Leader of the Opposition should be instructed to withdraw these remarks.


Mr. Speaker:: It has been brought to my attention, although I was quite able to hear myself, that both the Leader of the Opposition and the Minister of Finance have been using these words "false" and "falsifying", and once more I say that although the word "falsify" is rough and strong, provided there is no imputation of motive that the Minister of Finance deliberately and personally falsified and misled either persons or the country, yet I would caution the right hon. Leader of the Opposition to change the word.


John George Diefenbaker: Mr. Speaker, Winston Churchill was once asked to withdraw a
The Budget-Mr. Diefenbaker statement when he spoke of what had taken place in the house, which I am not doing-I am telling what took place on the outside- and he said, "if terminological inexactitude is parliamentary I certainly substitute it with the greatest of pleasure."
Now, sir, I shall deal particularly with some of the remarks made by the hon. gentleman today. It was an interesting speech he delivered. He spoke with pride of the degree of prosperity in the economy. Then with that modesty which characterizes him at all times he said: Here I am; I brought this about. I intend to quote from documents that he himself produced, not from the three tinker-ers of last year. I intend to quote from the white paper for the things that they criticized us about, which were heresy when we were in office and which today have become orthodoxy.
What have they done? What have they produced? I listened today with interest to ascertain what had been brought about. What policies have they inaugurated? What brought about the rising economy in this country such as we predicted would happen? I am going to quote from these two documents which are entirely free of any suggestion of partisanship. I mentioned devaluation a moment ago; I also referred to the import surcharges and to wheat sales, each and every one of them our policies. The hon. member for Assiniboia (Mr. Watson) produced a package of wheat and I can only say when I think of some of the statements made by hon. gentlemen opposite that it is too bad he was not here earlier so that they would have been able to see what wheat was like. They said there was nothing more dangerous than selling wheat to communist countries. They said: This is a terrible thing; this is something we would never countenance. Devaluation? Never under any circumstances. Let me point out that as far as devaluation is concerned the following appears on page 8 of the Bank of Canada report:
One development that has contributed a great deal to the Canadian economy's performance in recent years has been the improvement in Canada's international competitive position. This was greatly strengthened by the decline in the foreign exchange value of the Canadian dollar in 1960-62-
I refer now to page 47 of the white paper, and I quote this as an answer to the so-called arguments advanced today by the minister as he delivered what seemed to me to be his swan song. On page 47 the white paper says:
The trend of imports in the current upswing has been affected by a number of factors, including the devaluation of the Canadian dollar, the temporary import surcharges, the pattern of demand, and changes in the structure of the Canadian

The Budget-Mr. Diefenbaker economy. Following the imposition ol the temporary import surcharges in June, 1962, substantial reductions occur in the value and volume of imports.
What does the governor of the Bank of Canada say in this regard? As found on page 39 of his report he says:
The measures taken in the middle of 1962 to deal with the foreign exchange emergency resulted in a sharp reduction in the current account deficit-
I am simply putting these quotations on the record without observation. They need no interpretation. Again, the minister boasted today of the improvement in the payments position. What brought about the improvement in the payments position? At page 8 of the Bank of Canada report the facts are revealed in these words:
More than half of this improvement can be attributed to the unusual wheat and flour sales to the Soviet union.
I say that if it had not been for the former government selling wheat to communist nations, wheat would never have been sold to the U.S.S.R. With that naivete characteristic of the minister-


Some hon. Members:: Oh, oh.


John George Diefenbaker: I hope "naivete" is not going to jar the sensibilities of the people opposite who interrupt. The minister said we had a crisis in foreign exchange. Does he forget that the Liberal government had a crisis in foreign exchange in 1947? Does he forget that? Has he forgotten that he had one last July which he concealed from the Canadian people until it was revealed in the Bank of Canada report? He did not talk about these things today. How was the last potential crisis, the one that the government concealed from parliament, met? The Bank of Canada report says on page 6:
The announcement in mid-September of exceptionally large export sales of wheat and flour to the Soviet union dispelled immediate concern about the possibility of renewed foreign exchange difficulties for Canada-
I emphasize the word "immediate". In other words, we are not out of the woods yet. The concern is dispelled, provided there is an inflow of investment capital into Canada, and I intend to deal with that. I have already referred to devaluation and I do not want to put any more quotations on the record. I simply say that the Liberals went across Canada and they deceived the people, and I emphasize the word "deceived". Just read the record. I am not talking about them deceiving now; they have become paragons of all perfection and I would be the last to say anything in this house to indicate that they would have that characteristic today. But they told

the Canadian people that devaluation was dangerous. What does the Bank of Canada report say on page 51?
-the devaluation of the Canadian dollar improved the competitive position of Canadian industry.
Sir, it is difficult to understand why a political party would have endeavoured to undermine the Canadian economy by statements which have subsequently been proven to be untrue by the very fact that what they condemned they now adhere to.
What about the next step? What about American investment? There the tinkerers really worked. Do you recall how they said we were anti-American? They said we brought about a dialogue. Oh, it has been a wonderful change that has taken place. We go to Washington and we find out what the situation is there. We have the solution now for these problems. Then after having the Hyannis Port meeting the very first thing that happens is that the Minister of Finance proceeds to place before parliament a 30 per cent tax in order to interfere with the movement of capital between our country and the United States. He had to withdraw it. Then he added 5 per cent to the withholding tax, and what happened? The serious financial position in Canada today is only controlled to a reasonable degree by the fact that sales of wheat to communist countries have taken place. In the present budget there is a watered down version. What happened when the policies of the amateur economists who write books were carried into effect? What happened? The Bank of Canada report says that the rate of inflows, that is of United States capital, fell sharply after mid-year.
Page 52 of this report reads in part as follows:
These Inflows which exceeded $1,300 million in 1956 and 1957, were reduced to $584 million in 1963.
What do we find? The inflow for the first three months was some $140 million; for the next three months, $390 million and for the third three months, that is the period from July to September, it fell to $98 million. We have not had a report as yet for the last three months, although computations show that the amount coming into Canada instead of being $390 million is down to about $65 million. Why did the minister not tell us something about that this afternoon? What is he going to do about it? There is no answer at all. I had to refer to these matters, sir, because of the fact the hon. gentleman attributed the advance in our economy to the actions of this government and refused to admit that these policies which today receive a eulogy

in the Bank of Canada report, and also in the white paper, were policies introduced by us.
Then, the minister mentioned the tremendous benefits that had flowed from action taken to provide jobs. Let me say this: In 1961 and 1962 we predicted that, as a result of our actions in connection with unemployment, there would be a continuing reduction in the number of unemployed, and that statement was correct. Today he paid tribute to himself and to the government for making possible the technological training of our people in Canada by means of the vocational training scheme. This scheme was introduced by the hon. member for Ontario (Mr. Starr) when he was minister of labour. Today, they say that it was their policy that brought this change about. The total expenditure to date, according to the latest figures I have, for vocational schools is $330 million of which the former administration expended $315 million and the present administration $15 million.
I could go on and set out in detail the promises that were made by the present government and the reliance that they place upon legislation that we put on the statute books and which they ridiculed and loaded with contumely. Let me read now from a dominion bureau of statistics report of March 10 in connection with the balance of payments situation. This answers the Minister of Finance (Mr. Gordon) completely, and the arguments he made this afternoon. I quote:
Among leading factors in the economic background influencing the balance of payments were rising economic activity in North America and in major markets abroad such as the United Kingdom, Japan and some countries of western Europe. Along with this combination of strong influences was an apparent improvement in the competitive position of Canadian industry.
There are a couple of lines there, but I do not mind reading it all.
The devaluation of the Canadian dollar in 1962 together with tendencies to rising relative prices and costs in manufacturing countries abroad, has contributed to these changes.
Who extended export credits? The government of which I had the honour to be the head did this. Who made available-


George Clyde Nowlan: Doubled, trebled and quadrupled.


John George Diefenbaker: Yes, doubled, trebled and quadrupled as the hon. member says. I admire the conservative attitude of the hon. member for Digby-Annapolis-Kings (Mr. Nowlan). They said we were selling for credit to our enemies and taking cash from our friends for wheat. Well, we provided credits.
The Budget-Mr. Diefenbaker
The next thing is industrial policies. We introduced policies to encourage in Canada, by incentive but not by domination, the extension of industry within our country.
What about defence sharing? Under our government defence sharing mounted greatly in Canada for the first time since 1953 and, for the first time, we had a reasonable share of defence expenditures from the United States. Then, the report says that the temporary import surcharges which were still in effect in the early months of 1963 have also contributed to the change.
Now, sir, I have had to point these things out. I do not like to go over the record like this, but the hon. gentleman insisted that it should be done. What about the present situation? What is going to be done in order to ensure that Canada shall receive her reasonable share of United States investment? I can only point out what the white paper says, and that is that uncertainty continued to prevail in Canadian financial markets. There was virtually no Canadian borrowing in the United States from mid-July until the present time. Why was this? It resulted from the fact these people over there undermined confidence in Canada, and showed foreign investors that they could no longer rely on the integrity of Canadian promises.
I should like also to point out a reference I made earlier, and I would not do this if I had not been dragged into the debate. The Minister of Finance made a statement that we had a financial crisis. I ask him why he has not explained the situation in Canada. Why did he not explain what took place last July and August when they had a similarly threatening situation which was met temporarily by the fact that wheat sales to Russia provided foreign exchange? As I listened today to the hon. gentleman reveal what the present government has done, I noted one of the things he particularly underlined was what had been done to employ men and women over 45 years of age. All I can say in that connection is that the total number is 1,000. There are more than 12,000 over 65, and we do not know how many there are between 45 and 65. The cost was fabulous-that is, the cost of advertising. This is another example of the wasteful attitude of this government in spending hundreds of thousands of dollars on advertising in politically friendly advertising companies.
I am going to turn to the next phase. What about dominion-provincial relations? I see the genial Minister of Justice (Mr. Fa-vreau) here. If I had time I should like to analyse the speech he made last evening. There is one thing you can say about him, and that is he is consistent. It was a great

The Budget-Mr. Diefenbaker speech, according to the reports, but it did not get down to any particular. He predicted that a divorce was possible between the provincial Liberal party and the federal Liberal party in the province of Quebec. At least, there would be a parliamentary separation, but there was nothing to indicate what the attitude of the government was going to be on dominion-provincial relations.
This budget offers no hope to the provinces. Where are the items in this budget which will place flesh and blood on the bones of promise? They have set up the skeleton. They said they were going to help out the provinces. What do they intend to do? What is the plan? As a matter of fact I think the present budget, together with the fact that the minister went no further today than he did, indicates that this government, contrary to its pledged word, intends to do nothing other than play around with the question of joint programs. It does not intend to carry out its promise that the provinces will be enabled to have the necessary moneys with which to discharge their responsibilities. In the terms of the present budget I see a calculated and callous affront to the provinces.
I turn, now, to another subject-the attitude taken in connection with the Eskimos. I want to refer to that. The Eskimos are our responsibility under the law and under the constitution. I believe the minister of northern affairs (Mr. Laing) feels very keenly on this subject. But some of the other ministers in the cabinet seem to regard the Eskimo as tradable, as expendable. To carry out the present policy of disposing of them in the absence of a constitutional amendment would not only be unjust and unfair but would make a travesty of the constitution of this country. We do not intend to have the Eskimos, these people who are our responsibility, bartered as chattels or sublet for the sake of political expediency. I do not enter into provincial matters, but I say this: These Eskimos will not be placed in Mr. Levesque's hands just because Mr. Levesque wants them there. More will be said of this, because we in this country have a responsibility towards these people and, again, I emphasize that they cannot be removed from the jurisdiction under whose authority they are constitutionally placed merely by a simple agreement made between the federal government and a provincial government.
I heard nothing in the speech today about that banner with the device "Canadianization of Industry". Canadianization; we heard so much about that. It was in the book. It was also in the report. I will say this to the minister-that the report was one which showed a great deal of work applied to a very large problem. But nothing was said about this

Canadianization today. Nothing. Just uncertainty. I ask the minister in connection with Canadianization: Why did he evacuate the Canada development plan? Why did he desert that great principle? Who interfered? Who made it impossible for the hon. gentleman to carry it out? He had the vim. He had the vision of which he spoke. It turned out to be a nightmare. What happened to the Canada development corporation?
He pictured today what was going to happen

the development of the Columbia; the development of the Nelson river. All I can tell the hon. gentleman in this connection is that he was a little wrong in his history this afternoon when he said it was only under the present government that arrangements had been made to ship outside Canada power surplus to our needs. We brought that into effect in 1962. Yet, this afternoon, in a characteristic manner, an attempt was made to appropriate to the party opposite a policy which hon. members sitting over there criticized in the years from 1957 to 1961.
What about the Nelson river? We set up a full investigation into the potentialities of that development and, having arrived at an alteration in our policy with regard to the export of power, there are hopes that it will be proceeded with. Mention was made of the great potential in Labrador and I join with the hon. minister in expressing the hope that this development will be proceeded with at the earliest possible moment to the end that we shall be producing this power in Canada which, a few years hence, may not be as important as it is today if the cost of atomic energy becomes reasonably close to that of power produced by water.
What about the magazine situation? Canadianization? The resolutions are on the order paper; I may not refer to them now. But I must say there are many people in Canada today whose opinion is changing in this regard. They are asking themselves this question-whether or not Time and Reader's Digest should be absolved from the general legislative enactment respecting United States magazines and other foreign magazines which are brought into Canada particularly for advertising purposes.
Within the last few days an editorial has appeared in the Montreal Star which is of interest in this connection. It points out this:
These two magazines now dump their product into Canada after a manner and in a fashion which would not be tolerated by any government which seeks to prevent unfair competition from foreign producers If it was china or tinware, if it was boots and shoes, if it was shirtwaists or any other form of textiles, the government would have moved in, horse, foot and artillery, to stop the imports. But these two magazines import into this country their whole editorial content, collected at a cost greatly exceeding the budget available

to any Canadian magazine, and use it as the bait to attract advertising which might otherwise be available to a genuine Canadian magazine.
The article goes on to ask what the hon. members who represent Montreal constituencies are doing about this. What of the hon. member for St. Lawrence-St. George (Mr. Turner)? What about the Minister of Industry (Mr. Drury)? Why has none of these men made any move to help the Canadian magazines? It goes on:
Mr. Drury, it may be noted, is very pleased with a scheme which he presented to the House of Commons to increase the Canadian content of the motorcar produced in Canada. He appears to be wholly uninterested in the Canadian magazine, a somewhat curious performance-
I say, Mr. Speaker, that more and more people are asking today, as they look at these magazines, why they should be placed in an exempted position. Views in this regard are not frozen. They could be changed with changing conditions. I simply point out that nothing has been done by this government which in any way indicates that the great policy of Canadianization will go far enough to ensure that Canadians will have the opportunity within their own land to have their own magazines, unchallenged by unjust competition from outside this country.
I simply throw that out, Mr. Speaker, and add that those views more and more are being expressed as Canadians realize the import of some things that are taking place within this nation.
Mr. Speaker, I am asking support for our amendment. The minister has asked, "How could you bring about a reduction in taxes, with a large deficit?" President Johnson of the United States has given lead in this regard; he has given the lead by reducing unnecessary expenditures. We, in 1962, cut off some $200 million.


George Clyde Nowlan: More than $200 million.


John George Diefenbaker: More than $200 million. I was always conservative in that regard. I know how difficult it is. I do not like to point out the Minister of Public Works (Mr. Deschatelets) or anyone else, but the Minister of Public Works might be all for it in some other department; even the Minister of Trade and Commerce (Mr. Sharp), or the Secretary of State for External Affairs (Mr. Martin), with the tremendous expansion in the expenditures for foreign affairs-


An hon. Member:: And telephone bills.


John George Diefenbaker: -and all these other things. In the United States, instead of raising members' salaries, congress turned it down; they said, "We are not going to increase our salaries so long as we have taxation at its present level". What about 20220-91
The Budget-Mr. Latulippe Canada? Under this government everybody is getting an increase; fabulous increases are being granted. I think of the co-ordinator; I think that is the title of Mr. Kent. He brings together all these jarring elements; he brings about order out of chaos, and agreement in a cabinet that cannot agree. That is his job; he is worth $25,000 a year. But he has not done very well at it. They have been raising salaries all along the line, and the minister said that taxation in Canada is lower than that in the United States. I just want to say to him that he is the only one who has that view. Every responsible financial person in Canada has said, "What kind of blinkers was the minister wearing when he made that statement?" Our taxation today is higher than in the United States; it has increased, since this government came into power, by $390 million a year.
This afternoon the minister said, "Oh, the sales tax did not have any influence. We have the largest expenditures for investment in the first three months of this year". All I have to point out in that connection is that the Canadian Federation of Agriculture says the 11 per cent sales tax should be removed from production machinery used in agriculture. Every business across Canada has said that it should be removed, and that one of the major reasons for the increase in the last three months is the fact that they have been stockpiling against the increase from 4 per cent to 8 per cent and ultimately to 11 per cent. The minister produces the testimony of one man who said, in effect, "Great is Diana of the Ephesians".
Mr. Speaker, they said they would cut expenditures. What they have done is increase expenditures to a point far and beyond those ever before in effect in peacetime, except possibly during the Korean war. These are the people who were saying last year and the year before, "Just give us the opportunity and we will show you what we will do". They have, and the Canadian people today have no confidence in the government sitting opposite.


Mr. Henri Laiulippe (Compion-Fronfenac):: Mr. Speaker, at the outset of my remarks, I should like to say that we disapprove the Conservative amendment because it is negative in every respect.
During their term of office, the Conservatives themselves did nothing but increase taxes and accumulate budget deficits.
The two old parties are in the same old boat. The more things change, the more they remain the same. Neither party had the

The Budget-Mr. Latulippe courage to go to the very root of the present trouble by changing the old system for a new one adapted to the year 1964.
In the process of adjusting themselves to modernization, progress, science and reforms, the two old parties prefer submissiveness to freedom from the financial dictatorship which smothers and strangles the people. That is why we refuse to support the amendment.
Neither party has found a solution to the present problems of debts, taxes, budget deficits and rises in the cost of living index which cause even more serious stagnation in Canada.
Our democratic system and our financial system are no longer compatible. Instead of living in a democracy, we have a genuine dictatorship which prevents the young, the aged, women and men from leading a life of their own choice. As I say, we are truly living under a dictatorship which exercises its control through hunger.
The present system indebted Canada to the tune of $75 million at the time of confederation. Today, after 96 years of labour and development, the national debt totals $25 billion.
The public debt is made up of money which is non-existent, which has never been issued and which the government has pledged itself to reimburse; the financier creates the money and lends it, but on the promise that all that money, which he has never earned, will be reimbursed to him with interest.
The banker alone creates modern money; he does not make capital, but he asks to be paid, besides the capital, interest which he does not make and which nobody makes. As money does not grow by itself, the swelling claimed ends up in the public debt. That is why the public debt is rising.
Our economy is infected. This method of creating money and lending it with interest right away is the most effective invention which was ever inspired by Satan in a human brain so as to bring havoc to the economy, scuttle the Ten Commandments, sow dissension and hate, change man into wolf towards his brothers and make him the slave of money.
It is the opening of the race for money, for the dollar, to avoid being the one who falls, even if it involves causing the fall of others. Money has become the motivation, the end of everything; instead of producing wheat to feed, clothes to clothe, shoes to shod, houses to house, we do all that to raise more money than was invested. It is a must. The financier is there watching, claiming the dollar he brought into the world and demanding a return, this thing that we must take from our neighbour since it has not been put beside the dollar lent. And so, the economic life

which has become horrible, hard, implacable and cruel, according to the words used by the Pope himself. How can we talk of charity, of unselfishness, of compassion when an unrelenting rule is hung over our heads which compels us, unless we want to starve with our family, to play the game to extract from our country more dollars than have been issued?
To claim interest on the new dollar, to issue in this way taxing money every time the development of the country requires an increase in money, that is equivalent to accepting a thief in the economy of the country, thanks to the progress and the development of the country; that is why progress hardens the life it should relieve. It is a mortgaged and, often, a foreclosed progress.
Everybody's life revolves around the dollar. The fertility imposed on money by the manufacturer of dollars kills the fertility of talent, of genius, of development itself. As for the government, it is known that all its activities are determined by the presence or the absence of dollars.
There is a technique to create money in this way and put it into circulation for the benefit of all, without doing any wrong to anybody: it is the Social Credit technique. It is money to the service of man instead of man to the service of money. No inflation and no deflation, but a balance between services. It is a philosophy quite different from the present scarce money banking philosophy.
Through an autonomous procedure, balance would be established and maintained, because it is the responsible power itself which would control the means to increase the active money supply, as it would also control the means to put in on a sounder basis as required.
How many unnecessary hardships were forced upon the world for the past 25 years because the last war was not financed with other interest-free money or money issued without interest.
The situation in Canada is a striking one. Our federal debt was $2,574,531,033 in 1919, while today, the gross debt is $24,799,139,867 and the net debt $13,919,769,972. On the other hand, since 1914, we paid $14,869,164,125 in interests only, which is more than the whole net debt at this time. This means that, if all interest charges had been eliminated, Canada would practically be without debts.
We are told time and again that it is impossible for the government to borrow money without having to pay interest. Now, who is above the government to lay down what it should do?
There are 265 members sitting in Ottawa, but, except among the members of the Social Credit party, not a single voice was raised

to mention these things and to conclude that, work demands money, and money requires borrowing, and if you want to borrow, you have to incur debts, which means that in order to develop this country, the public debt must increase in proportion. That is what the federal, provincial and municipal governments, the school boards and individuals are doing now.
Hon. members of the government, like your predecessors, you are gallantly fighting and struggling but you do not dare change the rules. You prefer to fold your hands and piously ask Canadians to make sacrifices by increasing direct and indirect taxes, by raising general taxation and therefore the cost of living. Rather than show disrespect to the bookkeepers, the Minister of Finance (Mr. Gordon) prefers to follow that course. To balance two columns in a book is much more important than the life of 2,900,000 heads of families, who have to support 12,400,000 persons, on small single people's salaries. To tighten the consumer's belt throughout the country in the presence of goods which accumulate, go bad or are destroyed, that is one of the administrative virtues of the present government.
Science and progress teach people to set their eyes on realities. Now, this diabolic system does not satisfy young people, their aspirations or their ideals; they do not want to live in unemployment, to rob Peter to allow Paul to exist, even if this alleged liberty confers the right to cast a vote into the electoral urn.
If men are equal before God, they must be equal before the law and have an equal opportunity to earn their living. Brotherhood is a splendid ideal, but only in natural groups such as the family or the native land.
Our Canadian ancestors did not fight in order that their sons loaf about the streets in the cities, living the life of stowaways, not knowing, when they are 20 years old or 30 years old, what to do with their arms and their heads. Did they want us to be servants for foreigners coming here, on a call from us, with the pound sterling or the United States dollar, to enrol Canadians and harness them to their service, exploiting Canadian natural resources to the advantage of London or New York money makers?
The logic of the present system, we find it in mortgages on land won from the forest, in man-made legislation which guarantees that money will draw its salary even if towns and school boards have to be put in trusteeship, private individuals in bankruptcy and farmers out on the road.
When ratepayers pay taxes, they are handing over to the government some well-earned 20220-91^
The Budget-Mr. Latulippe money. Why could they not get in return, the same as the banker, an interest bearing bond?
Where is the logic in all that? With taxes being parallel, loans being possible for the rich, taxes being compulsory for everyone and people being taxed so that interest may be paid to lenders, what happens is that taxes, instead of contributing to a better distribution of wealth, contribute to a higher concentration of wealth.
The purpose of taxation, factor of privation, is to reduce the purchasing power of the public by giving the taxpayer, in exchange for his taxes, a corresponding liability which will have to be paid, since that liability bears interests. If the banker's stroke of the pen deserves interests, the sweat of the worker also deserves interests.
It would be less expensive for the government than the army of employees assigned to the collection of those taxes and the control of that collection. In that way, taxes would operate as interest bearing bonds, and the government would be relieved of a heavy and expensive bureaucracy. But considerations relating to a plan will throw more light on the flagrant injustice of our present financial system by which our governments breathe, act and swear.
Before this dying monster of hypocrisy, covered with debts like purulent and incurable sores, reeking of squalid selfishness, which cannot even be honestly protected by its guardians, what is there to take its place? Collapse into chaos and anarchy while being engulfed in an exasperated destitution?
Mr. Speaker, in conclusion, I am asking the Minister of Finance to tell us, if he can, where we are going, if we are going nowhere, what is wrong and what solution, if any, he has to offer.
I do not hesitate to tell him, supported by most Canadians, that the financial machinery in Canada is out of order and obsolete. The Canadian forests do not refuse to provide Canadians with lumber. The great rivers with their torrential waters are not dried up. It is not the manufacturers, nor the men who refuse to work; it is not the farmers who refuse to produce goods; it is not the land that refuses to yield crops; but all that will go to ruin if everything continues to be dependant on the old heartless financial machinery.
We need a financial machinery beneficial instead of detrimental to the Canadian people, a machinery making money in keeping with progress instead of making debts, a machinery likely to increase the purchasing power instead of decreasing it through heavier taxes which are a burden for everybody. We need a new economy, not an economy of hardship,
1438	HOUSE OF
The Budget-Mr. Latulippe but an economy distributing wealth. We must find as many new sources of money as are needed to distribute wealth among everybody.
Canadian finance at the service of Canadians; the wealth of Canada for Canadian families, all families; that is the true meaning of an economy at the service of the human being.
The Prime Minister (Mr. Pearson) said in his speech, at the beginning of the session, that the number of unemployed has decreased and that, on the other hand, labour income was much higher in 1963 than in 1962; that the number of jobs had increased tremendously and that the unemployment level in December, taking into account seasonal adjustments, was 5 per cent lower than it had been for many years. He also said that Canadians had made tremendous economic progress in 1963.
I will say to the Prime Minister, in reply, that Canada has never known an increase in social welfare comparable to that of 1963.
In fact, that department's estimates for 1962-63 amounted to $1,099,742,250 whereas in 1963-64 they were only $1,204,910,550, that is an increase of $105,168,300 for the last year. And for 1964-65, the estimates show an even larger increase.
The Prime Minister was careful not to say that the drop in unemployment had not kept pace with the increase in economic activity. In general, the unemployed totalled 7.2 per cent of the active population in 1961, 6 per cent in 1962 and an average of 5 per cent in 1963; and in mid-January this year, there were 466,000 unemployed, that is 7 per cent of the labour force.
However, unemployment is not the same throughout the country. In Quebec, for instance, 9 per cent of the workers are unemployed and, in the maritimes, 12.6 per cent of the labour force are out of work.
It is truly alarming to live under an economic system where at the national level one person out of 15 is unemployed and where one tenth of all Quebec workers and one eighth of the labour population of the maritimes are out of work.
It is our contention that the government has never really tackled the cause of unemployment and of the slow rate of economic growth in Canada. It has just skimmed the problem without ever finding its true causes.
I am convinced that the problem is mainly one of production. We have unemployed workers, idle industries and undeveloped resources. Our first problem is that a large number of Canadians are unable to buy the goods which our economy has produced or could produce.


I will say to the government's face that it is a crime to allow human beings to live under such conditions, when there is an abundance of goods to meet the needs of all classes of society.
Each man, each woman who does not eat enough and, who suffers from cold, each family which is poorly housed, is a living accusation against you, who belong to the old parties, and against the dishonest system that you try to protect with all your might. The day may be not too far off when you will be compelled to take your responsibilities.
The Creditistes are aware of their responsibilities and they fight to provide each individual with his share of progress and knowledge that has been passed on and accumulated from generation to generation, while the old parties have sold our national heritage and the fruit of the labours of generations to strangers. They have even relinquished the control of money and credit in favour of private interests. That is the reason why the people are dispossessed; it is the result of the economic disorder which we experience at the present time.
This is also the exact reason why we do not have a flag yet, since we are economically deprived of the fruits of passed generations. Our government parted with its sovereignty; when one is not master in one's own home, it is rather embarrassing to adopt a flag. That is probably why Liberals have been talking of a flag for 22 years and never adopted one. But we are playing upon people's feelings at each election with St. Jean Baptiste speeches, just like the master speech which the Prime Minister delivered last February 20.
I am quite pleased to say to my hon. friends of the old parties that people are now sufficiently informed not to believe in those speeches any longer but to believe in facts and in results.
The citizens of Canada realize that the old-line parties have seen to it that the people remained unaware of public affairs, of political and economic affairs and of financial affairs. People have been led to believe that democracy is the right to vote accompanied by the right to speak, the right to listen, the right to cheer, even when they are given a raw deal, the sacred right, for the people, to select once every four or five years those whose duty it will be to search through their pockets and put them to sleep.
People are on the verge of having enough of war policies, credit restrictions, austerity programs, excess taxes, money interests which annoy them and take everything away from them, surveys, forms, dictatorship, slavery.
Mr. Speaker, people want us to try and establish in this world a social order in which

man will be able to live decently so that he may reach his full development.


Mr. Speaker:: Order; it being 9.45 p.m. it is my duty, pursuant to section 5 of standing order 58, to interrupt these proceedings and put forthwith the amendment to the house.


Mr. Chretien:: Mr. Speaker, I was paired. Had I voted, I would have voted against the amendment.


[Stage Direction]
It being five minutes after ten o'clock the house adjourned, without question put.
[Stage Direction]
Wednesday, March 25, 1964