1964-10-01

[Stage Direction]
Fourth report of special committee on defence-Mr. Hahn.


Hon. H. J. Robichaud (Minister of Fisheries):: Mr. Speaker, hon. members will recall that when the estimates of the Department of Fisheries were before the house last week I promised that at the conclusion of negotiations which were taking place here in Ottawa among Canada, Japan and the United States for the revision of the north Pacific fisheries convention I might be able to make a statement to the house.
At the opening session of the Ottawa negotiations I expressed the hope on behalf of the Canadian delegation that this third meeting of the parties to the international north Pacific fisheries convention would resolve the remaining differences and would culminate in a successful conclusion of the protracted negotiations. Three weeks of uninterrupted negotiations have brought the parties very close to agreement, but it has not been possible to reconcile all the remaining differences, and the delegations have agreed to a recess in the discussions in order to study and recommend to their respective governments other approaches to the unsolved problems.
We had hoped that final agreement could have been reached for the revision of the existing convention which, of course, continues in force but which may be terminated upon 12 months' notice by one of the parties. At the same time we realize that the problems with which the delegations have been faced are very complex, and that all must be solved before agreeing on a convention which we hope will remain in force for many years. The frank and co-operative attitudes of the delegations have permitted much progress and encourage us to hope that we shall reach agreement at our next meeting.
20220-545J
I should like to give, for the information of the house, a very brief rdsumd of the Canadian position. The salmon runs to our streams are of the very highest importance to the fisheries of Canada's Pacific coast. We believe that through scientific study, strict regulation and positive fish culture methods we have maintained these stocks which would otherwise have disappeared. We believe that the salmon resource can be greatly increased by the application of scientifically based techniques which are now emerging. But this maintenance and increase of the runs require not only that we continue our intensive efforts in research, regulation and culture, but that we also continue, at considerable cost to our economy, the protection of our rivers from other uses which would make them unsuitable for salmon. To justify all these costs of maintaining and, we confidently expect, increasing the salmon resources the benefits must accrue to the Canadian economy.
During the past three weeks much progress has been made toward agreement which would meet our needs in an acceptable manner. It seems that, on the one hand, the basis for the Canadian position is now well understood and is given sympathetic consideration. On the other hand we realize that recognition of our special interests must be contingent on continuation of our special efforts to maintain and increase the salmon stocks and on continued full utilization by our fishery, and that the situation must therefore be subject to review by the commission established by the convention. We have been very close to agreement which would embody these essential points.
The greatest unsolved problem is concerned with conservation measures for those stocks of North American salmon which now are fished on the high seas. Although the problem applies especially to sockeye of Alaska origin, Canada has a potential interest in a solution which could be applied to other stocks fished on the high seas although to a much more minor degree. We are also concerned by the growing scientific evidence that the high seas fishing of salmon stocks which are intensively fished inshore may be wasteful.

North Pacific Treaty
It appears that we are close to agreement on a formula which would be acceptable in so far as the major halibut producing areas are concerned. This formula would recognize the long history of research and regulation by the international Pacific halibut commission on behalf of the governments of Canada and the United States, and the resulting successful restoration and maintenance of the important halibut fishery. We had hoped that similar protection could be extended to other areas where the stocks have been the subject of similar study and regulation and are utilized by our fishermen. This must now be a matter for further discussion.
Regarding herring, we hope that a satisfactory solution can be reached as herring is not of significant importance to Japan.
To conclude, I am satisfied that the Canadian delegation, to whom I am very grateful, has put forward its best efforts to bring about agreement which would provide the greatest measure of protection to those Pacific coast fisheries which are the mainstay of our fishing industry in British Columbia. I am also encouraged by the valuable progress that has been made toward the solution of the remaining differences, and hope that these may finally be reconciled at the next meeting.


Hon. J. A. MacLean (Queens):: Mr. Speaker, no doubt the house listened with interest to the rather lengthy statement of the minister on this very important subject. I regret that it was not quite as reassuring as we might have hoped it would be, because it is obvious that agreement has not been reached as yet on terms under which the north Pacific fisheries treaty could be extended for another lengthy or indefinite period of time. The minister neglected to say how long this recess in negotiations is going to be, but I hope it will not be too lengthy and that negotiations can be recommenced at an early date.
The problem is, of course, that there is a conflict of interest between Japan on the one hand and the United States and Canada on the other, because Japan depends on high seas fisheries and has very few streams which contribute anything to the stocks of salmon which are commercially exploited in the north Pacific. I would hope that the Canadian delegation, as they no doubt did, pointed out to Japan the possibility of Japan developing artificial spawning beds and other means whereby that country itself might make a worth-while contribution to these stocks of
IMr. Robichaud.]
fish, based on methods that have been developed in Canada.
We will look with interest to the reconvening of negotiations on this treaty, and we assume there will be no possibility of any of the parties giving notice that they intend to withdraw. The minister did not specifically say so, but we would hope that these negotiations will be reconvened at an early date and that a satisfactory agreement will eventually be reached.


Mr. Frank Howard (Skeena):: Mr. Speaker, I am sure it will also be recalled that at the time the minister's estimates were before the house we predicted that there would be a postponement or delay in the progress of the discussions and that for a number of reasons, possibly the pending election in the United States, there would not be a desire to announce anything bad arising out of the discussions. I hope we are wrong. I hope our fears will not be borne out when the talks are reconvened, and that the results of the resumed negotiations will be beneficial.
The minister's statement as I heard it was very revealing in that he made no reference whatever to the abstention principle contained in the present treaty. This was the basic point of the treaty negotiated in 1953, namely that Japan would abstain from fishing for certain fish in a certain area of the Pacific ocean. Japan, of course, has objected to this, and it is the main obstacle to the course of orderly discussions that might lead to an agreement. I interpret the minister's failure to make any reference to the abstention principle to mean in effect that perhaps Canada has relaxed what the minister called the firm position of the government in these negotiations, and that if we finally get a treaty we may very well end up with one renegotiated in such a way that the abstention principle is watered down or adulterated or not referred to at all.
As the New Democratic party has consistently pointed out, there is no doubt that we must approach our high seas fisheries from the point of view of international cooperation to conserve those fisheries in order to ensure that fish remain for future generations, and to ensure that exploitation is carried on within limits prescribed by the principles of a scientific approach to conservation itself. It is also a fact that Japan is not the only nation bordering upon the Pacific ocean that fishes in those waters. The Soviet union has an almost rapacious demand for fish products, and in the past few years has expanded tremendously its fishing oper-

ations beyond the area close to their shores where it has traditionally fished.
I would reiterate the vital importance of this matter. To go back to the time before this government were elected to office, they promised that Russia would be drawn into the treaty. It is vitally important to make some approach to the Soviet union to ask that country if they will take part in the next negotiations, even if only in the capacity of an observer. I say this because it is important to have an international agreement among all the nations that are exploiting this particular fishery; and unless Russia does come into the treaty we could very easily see all our efforts toward conservation come to naught because of the expansion of the Soviet union into the high seas salmon fishery.
We shall look forward with great interest to the resumption of these discussions, even though the minister neglected to say when they would be resumed. We hope they will be resumed at an early date and will proceed rapidly to a successful conclusion.


Mr. A. B. Patterson (Fraser Valley):: Mr. Speaker, we hope the length of the negotiations that have been carried on is an indication of the desire of the Canadian delegation to safeguard Canada's vital interests at all costs. I would not like to think it is an indication of failure. I prefer to think of it as showing that the minister and the Canadian delegation are determined to maintain our position and insist on the safeguards we have enjoyed in the past.
So far as the west coast is concerned, this is a matter of tremendous importance. The minister is aware of all the representations that have been made on this matter, and though he made no reference to the abstention principle that is included in the present treaty, I trust that at least the idea of it will be carried out even if it is not stated.
We in this party also regret that the statement has not been more conclusive and definite, but we look forward to the resumption of these talks in the not too distant future in order that these problems may be ironed out and a satisfactory agreement signed.


Mr. Real Caouette (Villeneuve):: Mr. Speaker, we have listened attentively to the remarks of the Minister of Fisheries (Mr. Robichaud) with regard to international agreements between Canada, Japan, the United States, and probably with other countries later on, concerning fisheries in the Pacific.
Labour Conditions
On behalf of our group I hope similar arrangements will be made for the Atlantic so as to assist the fishermen of the eastern provinces and to find international markets for their products, which will enable them to enjoy the advantages our western fishermen are now enjoying or will be enjoying in the near future.
So it is our heartfelt wish that the Minister of Fisheries will look after our eastern fishermen as energetically as he is looking after our western fishermen at the present time.



On the orders of the day:


John Angus MacLean: Mr. Speaker, I should like to ask the Minister of Fisheries whether he is able to say when the negotiations to which he referred will be reconvened, and where.


Hédard-J. Robichaud: I am not in a position to say definitely at this moment when the meeting will be reconvened, but the United States delegation has expressed the hope of its government that the next meeting be held in the United States at a time and place to be determined by the three governments concerned, and I know the three delegations are hoping to meet at the earliest possible date.



PRESENCE IN GALLERY OF NATO SECRETARY GENERAL

Mr. Speaker:: I am sure hon. members will not object if I break into these proceedings in order to point out that we have in the Speaker's gallery a most distinguished visitor in the person of Signor Manlio Brosio, the newly appointed secretary general of the North Atlantic Treaty Organization.


Some hon. Members:: Hear, hear.


Mr. Speaker:: At four o'clock this afternoon in the railway committee room all hon. members who are free to attend are cordially invited to come, meet and hear Signor Brosio speak.



LABOUR CONDITIONS


Hon. A. J. MacEachen (Minister of Labour) moved: for leave to introduce Bill No. C-126, respecting hours of work, minimum wages,

Question of Privilege
annual vacations and holidays with pay in federal works, undertakings and businesses.


Some hon. Members:: Explain.


Allan Joseph MacEachen: The purpose of this bill is to establish a national minimum wage of $1.25 an hour, a standard eight hour day and forty hour week, annual vacations with pay and seven statutory holidays for works under federal jurisdiction. The short title of this bill is Canada Labour Standards Code. It breaks new ground in the field of labour standards not only in Canada but on this continent, I believe.
Motion agreed to and bill read the first time.



PRIVILEGE


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I rise on a question of privilege. I do so entirely on my own responsibility, but I believe that members generally will agree it is a point of privilege and that it concerns all of us as members and that it concerns the house itself.
On April 20 of this year the house, by unanimous decision, adopted certain provisional standing orders and certain guide lines respecting the asking of questions on orders of the day. The immediate result of that decision of the house on April 20 was that for the first few weeks that followed we cut in half the amount of time we had been taking with respect to questions on orders of the day. I think members will agree also that during that period not only did the asking and answering of questions take a shorter period of time, but it was a crisper and better period in every respect.
In recent weeks, however, to put it mildly we have been slipping. I have been keeping my own records, and I have checked with those who keep the official records. We are just about back to where we were before we made the changes on April 20. I have been tempted several times in the last couple of weeks to raise a point of order during the question period because I felt a certain member was abusing the rules by his question or a certain minister was abusing the rules by his answer. However, it really does not help to solve the problem by intervening in that way. I have therefore taken this opportunity to raise this point of privilege.
I suggest that both the house and Your Honour would like us to get back to the

position we achieved immediately after April 20. There is no point in trying to put blame on particular persons. I think in the first place the responsibility and blame rests upon us as members, and that includes all of us. In the second place, I think Your Honour would not mind if I were to say that you have not been clamping down in recent weeks as you were immediately after April 20. You have been reluctant to enforce the rules and the guide lines which the House of Commons placed in your hands. Therefore, on this question of privilege, I believe the house would welcome Your Honour applying more strictly the rules and guide lines we gave you. We would welcome it if they were applied to party leaders and backbenchers alike; we would welcome them being applied to those who ask questions as well as to those who answer them.


Hon. Gordon Churchill (Winnipeg South Centre):: On this question of privilege, which I think is not a question of privilege at all, I should like to say that if each member of this house is to give instructions to the Speaker I would be inclined to suggest that questions of privilege should be valid questions; otherwise they should not be raised.
I do not see in what way this can be interpreted as a question of privilege. Had the rights and privileges of members been interfered with, there might be a question of privilege involved; but all the hon. member has done in this instance is draw attention to what he calls a question of privilege in an attempt to place the house in a strait-jacket, according to his ideas, and restrict the privileges of hon. members to ask questions on the orders of the day. We have that restriction applied on Wednesday of each week and Mr. Speaker has rather carefully followed that rule. On the other days there has been no restriction imposed. It is only the hon. member's own opinion that conditions are less favourable now than they were in the last ten days of April; it is not an opinion shared by other hon. members of this house.
I suggest to you, Mr. Speaker, that if we are to have bogus questions of privilege raised, as this one is, this destroys the effectiveness of the House of Commons. I think people who are raising questions of privilege of this nature should make very sure in advance that they have valid questions of privilege; otherwise I think the hon. member should be interrupted in the course of his remarks, which he has used on this occasion

just to promote an idea that may reside within his mind and that of some of the members of his party, namely that restrictions should be placed on the House of Commons. The restrictions might very well start with the hon. member himself and members of his party.



VETERANS AFFAIRS


[Stage Direction]
On the orders of the day:
Right Hon. J. G. Diefenbaker (Leader of the Opposition):: Mr. Speaker, I would like to ask a question of the Minister of Veterans Affairs based on a widespread demand expressed in correspondence I am receiving from veterans who, because of the rise in living costs and rentals, are asking for a needed and desirable increase in disability pensions and war veterans allowances. Would the minister, for the benefit of the house and also for veterans generally who are asking for this, let the house know whether at this session action will be taken so that those receiving these pensions and allowances may enjoy something of the increase that has come to so many in various positions in the last 17 months?


Hon. Roger Teillel (Minister of Veterans Affairs):: Mr. Speaker, I think at this moment I am not prepared to go any further than I went when I was asked this question a few weeks ago. I can say it is my hope that some time during the course of this month I will be in a position to bring forth recommendations with respect to pensions.


David Réal Caouette: Mr. Speaker, may I ask the hon. minister a supplementary question? Does he know that the veterans of the first world war receive only $48 a month as a pension or allowance, and could he tell us if he is now studying the opportunity or possibility of increasing this pension to at least the present amount of old age security in Canada?


Roger-Joseph Teillet: Mr. Speaker, in reply to the hon. member, I should first like to say that the first world war veterans' pension is not limited to $48 a month. Pensions are based on the degree of disability suffered during military service, and there is no discrimination between the two groups, namely that of the first world war and that of the second. As for allowances, they are based mainly on the financial status of the veterans concerned.
Inquiries of the Ministry
I could add the same answer I gave a moment ago to the hon. Leader of the Opposition (Mr. Diefenbaker), to the effect that this question is now under study and that I hope to be in a position to report on it soon.



THE CANADIAN ECONOMY


[Stage Direction]
On the orders of the day:
Mr. T. C. Douglas (Burnaby-Coquitlam):: Mr. Speaker, may I ask the Prime Minister whether his attention has been drawn to the statement made by the Minister of Industry in a speech yesterday in Montreal, in which he said:
-the Canadian economy is not growing fast enough to provide sufficient employment opportunities for the growing labour force.
In view of this statement by the minister, and in view of the fact that for the second quarter of this year the gross national product, in real terms, has not increased-as a matter of fact, in the non-farming sector it has decreased slightly and at the end of the six months' period of this year the international deficit on non-merchandise account was $518 million, an increase of $86 million over the same period in the previous year-I ask the Prime Minister whether the government intends to bring down any specific legislation to deal with the problem which has been so graphically outlined by the Minister of Industry.


Right Hon. L. B. Pearson (Prime Minister):: There is, of course, a good deal of legislation on the order paper. In so far as the particular question is concerned, I have not had the opportunity or the pleasure of studying the text of my hon. friend's speech. I will be glad to look into it and read the observations which my hon. friend has made, in the context of the rest of the speech.



STEPS TO IMPROVE CONDITIONS IN MARITIMES

[Stage Direction]
On the orders of the day:
['Mr. Speaker, this question was asked yesterday. I can simply say that although I have had an opportunity of seeing a summary of the communique, I have not seen the full text. It seems to be contrary to the spirit of the security council resolution of March 4, and it may be in violation of the treaty of 1961, but I would not want to give a final opinion.']
Mr. Thomas M. Bell (Saint John-Albert):: I have a question for the Minister of Labour. In view of the remarks that were made recently in Halifax by Mr. Dodge of the Canadian Labour Congress to the effect that poverty and destitution down east are twice

Inquiries of the Ministry as serious as in central Canada, and now that the minister is moving with other departmental legislation, can he tell us if there would be any measures that might help correct this situation in the near future?


Allan Joseph MacEachen: When the house has taken action on this particular bill which will make some contribution to the solution of the problem, then we may be in a position to bring forward other measures.


Thomas Miller Bell: Specifically, and in a supplementary way, may I ask the minister whether he or his colleagues have under consideration changes in the method of encouraging industry which has been criticized so much by many organizations such as APEC, and which certainly is not working out in the way it was intended.


Allan Joseph MacEachen: Mr. Speaker, as has been stated by the Minister of Industry, the area development system designation is presently under review with the expectation that changes may be made to make even more effective than it is at the moment.


Mr. H. Russell MacEwan (Pictou):: Mr. Speaker, I have a supplementary question to the one asked by the hon. member for Saint John-Albert. Has the Minister of Labour received a report yet from the Atlantic development board in regard to the unemployment situation in the county of Pictou? Has he referred this matter to the board, on the recommendation several months ago of the New Glasgow and district labour council?


Mr. Speaker:: These are questions for the order paper.



[Stage Direction]
On the orders of the day:
Mr. R. N. Thompson (Red Deer):: Mr. Speaker, my question is to the Secretary of State for External Affairs. In view of the agreement that has been signed by the foreign affairs minister of Cyprus with the government of Russia, and the anti-NATO overtones which have accompanied its reception in Cyprus, can the minister today give us any more information as to the terms of this agreement and what effect it will have on our own relations in Cyprus in the peace keeping operation?


Hon. Paul Martin (Secretary of State for External Affairs):: Mr. Speaker, this question was asked yesterday. I can simply say that although I have had an opportunity of seeing a summary of the communique, I have not seen the full text. It seems to be contrary to the spirit of the security council resolution of March 4, and it may be in violation of the treaty of 1961, but I would not want to give a final opinion.



CANADIAN BROADCASTING CORPORATION


[Stage Direction]
On the orders of the day:
Mr. Gilles Gregoire (Lapointe):: Mr. Speaker, may I direct a question to the right hon. Prime Minister?
Is the Prime Minister aware of an offer that has been made by the Canadian Broadcasting Corporation to the leaders of the smaller parties in the house for some broadcasting time on the television network following the allocation of time of the Liberal and Conservative parties? Does the Prime Minister know that this offer has been withdrawn by the C.B.C. within these last few hours, thus depriving the leaders of the smaller parties of broadcasting time after it had been offered to them?
Does the Prime Minister intend to intervene in this matter?


Lester Bowles Pearson: Of course I am aware of the offer, Mr. Speaker, because it was given to the house last week, I think, by the Secretary of State. I am certainly not aware that the offer has been withdrawn, and I will be glad to look into that matter.


Thomas Clement (Tommy) Douglas: Mr. Speaker, I rise on a question of privilege. In order to be perfectly fair to the C.B.C. I would say that the offer was made and as far as I know was not withdrawn. I understood that the hon. member for Villeneuve had declined to take part, and I notified the C.B.C. yesterday that I would not take part if it were to be restricted to a discussion of the flag question, since this matter has been sent to a committee. Speaking as far as I am concerned personally, to be fair to the C.B.C., the offer was not withdrawn. I for one said I was not prepared to take part in it with

this restriction of the discussion being limited to the flag question.


David Réal Caouette: Mr. Speaker, in relation to the question of privilege raised by the hon. member for Burnaby-Coquitlam, I must inform the house that last week Mr. Taylor of the C.B.C., informed me that a thirty minute period would be granted the three leaders of the third parties, which meant six minutes for each leader once the question had been asked.
Last week I received a telephone call from Mr. Benoit, an official with the French network of the C.B.C., who made me the same offer. And this morning the same Mr. Benoit telephoned my office to tell me that this offer of thirty minutes had been withdrawn.
Mr. Speaker, in my opinion it is absolutely unfair to grant us three only thirty minutes while the Prime Minister and the Leader of the Opposition each got thirty minutes. I told the representative of the C.B.C. that I would accept a period of fifteen minutes, but that I would decidedly not accept a period of only six minutes.


Robert Norman Thompson: A supplementary question, Mr. Speaker. I do not intend to make this a debate, but I think in fairness to the C.B.C. something should be said. I am one who is often most critical of the C.B.C., and I also agree that this offer was not exactly a fair one. On the other hand the C.B.C. did consult me and I would substantiate the remarks of the hon. member for Burnaby-Coquitlam that the offer was set aside because it seemed that any talk on the flag issue was irrelevant at this time.


Gilles Grégoire: A supplementary question, Mr. Speaker.


Mr. Speaker:: Order, please.


Gilles Grégoire: A supplementary question, Mr. Speaker.


Mr. Speaker:: Order. This discussion is out of order. This question is becoming a debate.



QUALITY OF FILM PRODUCED BY INTERVIDEO LIMITED

[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Port Arthur):: Mr. Speaker, I want to ask the Secretary of State a ques-
Inquiries of the Ministry tion regarding the "Mr. Pearson" film produced by Intervideo Limited and Richard Ballentine. Would the minister inquire from the C.B.C. whether the half hour film shown on the C.B.C. last night at 10.30, produced by Intervideo Limited and Richard Ballentine, showed adequate technical competence?


Hon. Maurice Lamontagne (Secretary of State):: I will, Mr. Speaker.



VANCOUVER-POSSIBLE USE OF FORMER R.C.A.F. BASE

[Stage Direction]
On the orders of the day:
Mr. Barry Mather (New Westminster):: have a question I should like to ask the Minister of Northern Affairs and National Resources, notice of which I have given. The question relates to the current discussions between the C.B.C. and the Vancouver parks board as to who is to control the former air force buildings and land at Kitsilano. Is consideration being given to a compromise which could see the C.B.C. occupying the buildings for a period of some years and the parks board becoming heir to the property, in the interests of public recreation, after that time?


Mr. Speaker:: Would the hon. member put this question on the order paper? If I am not mistaken this question has been up several times during the last few weeks.



WATER LEVELS


[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 Northern Affairs and National Resources. Has the minister received any formal objections from any Canadian organizations to the diversion of the waters of the northwestern rivers in Canada, particularly the Yukon, south to the United States or into the great lakes to raise their levels, as proposed by the parliamentary secretary to the Prime Minister at Prince George?


Hon. Arthur Laing (Minister of Northern Affairs and National Resources):: No, Mr. Speaker.



ADMINISTRATION OF JUSTICE


[Stage Direction]
On the orders of the day:
John George Diefenbaker: Mr. Speaker, I should like to ask a question of the Minister of Justice. Is

Inquiries of the Ministry the minister now in a position, after six weeks of delay, to give an answer as to the whereabouts of Hal Banks; and has the minister yet been able to secure information from the immigration authorities of the United States that this elusive gentleman crossed the line and when doing so left his name and address?


Hon. Guy Favreau (Minister of Justice):: Mr. Speaker, I am not yet in a position to give the house a precise answer as to the whereabouts of Mr. Hal Banks, although while I am on my feet I am in a position to answer a question put to me recently by the right hon. gentleman which asked when gross negligence in dealing with Mr. Banks first occurred.
I am now in a very clear position to state positively that if there has been gross negligence it started in 1958, when the Department of Justice asked the R.C.M. Police to investigate in order to determine whether Banks had been employing intimidation or violence in the furtherance of union activities. By the end of 1958 information had been obtained about the Walsh beatings. On February 23, 1959, when there was still time to look into the matter of whether Banks could be deported and deprived of Canadian domicile, there had been sent to the minister of justice a full account of the conspiracy to beat Walsh as related by the principal crown witness at the trial, Richard Greaves. On June 14, 1961 there had been sent to the minister, and therefore to the government, another report which included an account of the Walsh conspiracy of the other principal crown witness, Sheehan.
No action was taken against Banks, notwithstanding that this was a time when evidence relating to the Walsh incident was readily available and evidence relating to other incidents might also have been obtained. This was also the time when firm action might have prevented the deterioration in the situation on the St. Lawrence and great lakes system which culminated in the physical impasse on the St. Lawrence seaway in the summer of 1962, when the Welland canal was blocked as described in the Norris report.
Instead, a royal commission was appointed on July 17, 1962. Without detracting from the value of that inquiry it is a fact that an inquiry was not necessary to bring to light the evidence upon which the recent conviction of Banks depended. Thus, these proceedings could have been commenced five years before they were commenced.


Some hon. Members:: Oh, oh.


John George Diefenbaker: Mr. Speaker, I have allowed the hon. gentleman to answer in a way quite out of keeping with the facts.


Some hon. Members:: Oh, oh.


John George Diefenbaker: May I say at once that what the minister has stated is completely untrue as it related to the refusal of the former government to act. What actually happened was that the pampered pet of Liberalism was not proceeded against, and now the hon. gentleman is endeavouring to exculpate himself for his failure to act.
May I now ask him this question. Is it true that the minister has known for the last several weeks the whereabouts of Banks? I ask that question because Mr. Banks was apparently interviewed on a radio broadcast and stated that he has not been in hiding and that the government has known where he was all the time. I think the very fact he said this indicates the truth of what has actually taken place; that this government charged him with the one offence on which he could not be extradited and then let him go.


Guy Favreau: Mr. Speaker, in all my life as a practising lawyer and since the few months I have been in the government I would never have believed that such an implication would be made and put to me. Whatever is implied in the question is totally false.


John George Diefenbaker: Does the Minister of Justice tell this house that he has no information on the whereabouts of Banks? If he does I accept it. Banks, of course, will be able to tell the story as it is and relate the manner in which the government protected him.


Herbert Wilfred Herridge: supplementary question, Mr. Speaker.


Mr. Speaker:: Surely we have had enough discussion of this matter.


Herbert Wilfred Herridge: Has the minister heard about an unofficial committee meeting of members of all parties of this house in 1956 at which seamen from Banks' union told us of beatings, car burnings and all that sort of thing, and that nothing was done although we tried to get something done?


Mr. Donald Maclnnis (Cape Breton South):: A supplementary question, Mr. Speaker.


Mr. Speaker:: If it is a supplementary question I hope it is going to be a quiet one and of assistance to the Chair.


Malcolm MacInnis: I should like to ask the Minister of Justice, who has concerned himself with detracting from the Norris commission report, whether this now means that in order not to further detract, Mr. McLaughlin is going to be prosecuted.


Guy Favreau: Mr. Speaker, this question has been answered much earlier by way of answers to previous questions referring to exactly the same matter, and I stand by the answers I have given.


Malcolm MacInnis: Mr. Speaker, I have a further supplementary question, and I might point out that this question has not been answered. The minister has definitely concerned himself-


Mr. Speaker:: Order. If the hon. member is entering into an argument with the minister I think I must remind him that it is well established custom in this house that the minister's answer should be accepted in the first instance.


Malcolm MacInnis: Mr. Speaker, in the interests of protecting the Norris commission report, with which the minister is concerned, is he going to activate proceedings against Mr. McLaughlin, as the Norris commission report recommended?


Some hon. Members:: Oh, oh.


Mr. Remi Paul (Berlhier-Maskinonge-De-lanaudiere):: May I ask the Minister of Justice a question? Since Mr. Hal Banks' $25,000 bail was forfeited yesterday, could the Minister of Justice tell us to which department of revenue the proceeds of that forfeiture will be paid? Will it be to the Department of National Revenue or to the Quebec department of revenue?


Guy Favreau: Mr. Speaker, that matter, as I said last week, comes under a rather vague provision of the code stipulating that if the cost of an action is to be borne by a provincial government, the money accruing from the forfeiture is paid to the provincial treasury and vice-versa, if the cost is borne by the crown the money falls into the federal treasury.
Apparently, in a case such as this one, where both parties contributed to the cost of the trial and investigation it is done through 20220-546J
Inquiries of the Ministry negotiation, but to date the matter has not been dealt with.


Mr. Raymond Langlois (Meganlic):: Mr. Speaker, may I ask a supplementary question?
Considering that Mr. Hal Banks has not yet been arrested, will the $25,000 which will be turned over to the public treasury soon contribute to a reduction of the income tax?



HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Mr. P. B. Rynard (Simcoe East):: Mr. Speaker, I should like to address a question to the Minister of Finance, and in his absence to his parliamentary secretary. Would the minister consider instituting immediately a crash program to train more doctors to meet the present emergency, and to explore further the possibility of medical schools operating for a full term of 12 months rather than eight months?


Mr. L. T. Pennell (Parliamentary Secretary to Minister of Finance):: Mr. Speaker, I thank the hon. member for giving notice of this question. It will be brought to the attention of the minister at the earliest possible moment.


Mr. Heward Graffley (Brome-Missisquoi):: Mr. Speaker, I have a supplementary question I should like to address to the Minister of Industry in his capacity of answering to the house in respect of the activities of the scientific secretariat. In view of what the hon. member has just said; in view of the fact that many qualified students are being turned down at our medical schools this fall, and in view of the fact that many people seem to think that research facilities are necessary-


An hon. Member:: Sit down.


Mr. Speaker:: Order, please.


Some hon. Members:: Oh, oh.


Mr. Speaker:: Order. If I understood correctly, this afternoon the house wanted to tighten up the rules. It seems to me that the first step in such tightening up should be taken by the hon. members themselves. I will look after the second step. Will the hon. member please pose his question as quickly as possible.

Inquiries of the Ministry


John George Diefenbaker: Mr. Speaker, when speaking of tightening up the rules, I can only point to the manner in which the Minister of Justice was allowed to depart so far from the rules.


Some hon. Members:: Oh, oh.


William Heward Grafftey: In all seriousness, Mr. Speaker, I should like to say to the Chair that I spent a good amount of time drafting a proper question, and I was very briefly underlining the urgency of my question with some facts. I realize because of the atmosphere in the house this afternoon it is very hard to put across a question that is in order.
I should like to ask the minister, in view of the fact the national institute of health in the United States has seriously cut down its grants to basic medical research in Canada, is the government seriously studying this situation, and does the government intend to increase assistance to basic medical research in Canada in the very near future?


Hon. C. M. Drury (Minister of Industry):: Mr. Speaker, I think the government agencies concerned in this field are seized of the urgency and seriousness of this question. I might, however, point out specifically to the hon. member that the decrease in national health service grants in the current year has been more than offset by grants by the Canadian medical research council.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Mr. D. W. Groos (Victoria, B.C.):: Mr. Speaker, I should like to direct a question to the Minister of National Defence. Is the minister now in a position to name the new stand-by battalion for United Nations duty?


Hon. Paul Hellyer (Minister of National Defence):: Mr. Speaker, it will be recalled that at the time of the establishment of the UN force for Cyprus last March the first battalion of the Royal 22nd regiment was designated as the stand-by battalion for United Nations duties, and in consequence this battalion was sent to Cyprus. With the despatch of the Royal 22nd regiment the first battalion of the Canadian Guards, stationed at Camp Picton, Ontario, was nominated as the standby battalion. With rotation under way in Cyprus this battalion is now replacing the Royal 22nd regiment.
This latest move has resulted in the necessity of naming another stand-by battalion, and

it has been decided that the first battalion of the Queen's Own Rifles of Canada should be designated for this function. The first battalion, Mr. Speaker, is stationed at Victoria, British Columbia.



LA MACAZA, QUE.-TREATMENT OF PEACE DEMONSTRATORS BY R.C.A.F. POLICE

[Stage Direction]
On the orders of the day:
Paul Theodore Hellyer: Mr. Speaker, perhaps I may be allowed to make a brief statement in reply to another question which has been outstanding for some time.
Some days ago the hon. member for Burnaby-Coquitlam, referring to certain allegations made by individuals who had demonstrated outside R.C.A..F. station La Macaza over Labour day week end relating to unnecessary use of force by R.C.A.F. guards in removing them from the roadway at the entrance to the station, asked the Prime Minister if a further investigation would be made into these allegations.
The Prime Minister asked my colleague the Associate Minister of National Defence to look into this matter and report to him on the feasibility of holding such an investigation referred to by the hon. member. As hon. members are aware, in reply to a question asked earlier the associate minister had stated that a report had been received from the commanding officer of the station, and that on the strength of that report he was satisfied that no unnecessary use of force had been employed.
Subsequently the associate minister personally interviewed the commanding officer of R.C.A.F. station La Macaza. He was informed by the commanding officer that strict instructions had been given to all R.C.A.F. personnel that the minimum amount of force should be used to remove demonstrators who were blocking entrance to that station and, as far as he and other officers and and noncommissioned officers were aware, these instructions had been complied with.


An hon. Member:: A very short and crisp answer.


Paul Theodore Hellyer: In order to carry out their stated intention to block traffic moving in and out of the station, members of the demonstration were instructed to sit and lie on the road. When R.C.A.F. guards attempted to carry them to the side of the road they went limp, thus purposely increasing the difficulties faced by the officials of the station. As a result, as was the case in a demonstration

earlier in the year at La Macaza when no complaints of violence were made, individuals had to be forcibly moved to the side of the road, from where they immediately attempted to return.
No complaints were made at the time of the demonstration, nor was there any allegation then of injury sustained by any demonstrator. In fact the various charges of the misuse of force were not made until several days after the demonstration had been completed.


An hon. Member:: Amen.


Mr, Hellyer:: There was no restriction imposed or attempted on anyone taking photographs of the demonstration.
Further, immediately after the demonstration one of the leaders was quoted in the Montreal Gazette of September 10 as saying "There was no trouble at all, a number said goodbye and waved to the guards at the gate, but the guards did not respond".
I might say that the leaders of the demonstrators made it clear that they understood that they were trespassing on government property and that their objective was-


William Heward Grafftey: Why don't you get yourself a precis writer?


Paul Theodore Hellyer: Mr. Speaker, I wonder whether you would ask the hon. member opposite to stop interrupting.


William Heward Grafftey: Mr. Speaker, on a point of order, the house is being subjected to long ministerial statements, and I recommend to the treasury benches that they hire a few precis writers in their departments. Mr. Speaker, what is taking place now is an obvious breach of the rules of this house, and I ask you to bring the minister to order.


Mr. Speaker:: Order. I have listened to the hon. member for Brome-Missisquoi with a great deal of interest and, I hope, patience. The first long statement this afternoon was made in an attempt to answer a very serious charge. This statement this afternoon has been asked for by one member, and though it may be a little long-and I regret the length of some of the statements-the ministers must take their own responsibilities in that regard.


Paul Theodore Hellyer: Mr. Speaker, I regret the length of the statement, but I must say it is much better prepared than the rather imprecise statement made by the hon. member a little earlier.
Inquiries of the Ministry
I might say that the leaders of the demonstrators made it clear that they understood that they were trespassing on government property and that their objective was, in effect, deliberately to provoke an incident by preventing the free movement of vehicles going about their proper business, including the transportation of civilian personnel employed at the station.
It is felt that in the circumstances a further investigation would serve no useful purpose. The Prime Minister, who has personally looked into the whole question, agrees with this view.


Thomas Clement (Tommy) Douglas: A supplementary question, Mr. Speaker. I should like to ask either the Minister of National Defence or the Prime Minister if this is what the government considers an independent investigation, carried on by the Minister of National Defence and the associate minister. It seems to me this is very much like asking a man who is accused of misappropriation of funds to audit the books.


Mr. Speaker:: Order. Would the hon. member make his question short and succinct.


Thomas Clement (Tommy) Douglas: Mr. Speaker, I can assure you that my question will be much shorter than the previous answer by the minister. I should like to ask the minister whether any attempt was made to interview any of the four or five young people whose names were given in the press, particularly Miss Kathy Moses who claims to have been kicked between the legs, and a young lady who claims to have been beaten and dragged by the hair. I want to ask the minister if any attempt was made to interview these people and get all the facts, or is the minister's report based entirely on the report of the officers who were responsible for the conduct of the guards in question?


Paul Theodore Hellyer: Mr. Speaker, we can only base our opinion on the facts we have available. The department has received no complaints from any of the demonstrators, and no claims have been made. I might quote to my hon. friend from a pamphlet issued by this organization entitled "Unique Action at La Macaza" in which it is stated:
On Tuesday at 4.30 p.m. we precipitated a "crisis'' for the military with their obvious policy of "no arrests and no draggings" by splitting into two groups and blocking a secondary entrance which the air force had been using for some important traffic. With the blocking of both entrances the base was genuinely sealed. We had taken a new initiative. Would the military respond, and if so, how?

Inquiries of the Ministry


Thomas Clement (Tommy) Douglas: May I ask the minister a supplementary question. If these young people were breaking the law were any of them arrested? Why were charges not laid against them?


Paul Theodore Hellyer: They were not arrested, Mr. Speaker. On the other hand, if any of them had felt that undue force had been used I would have expected that they would have laid charges and used the due processes of law as laid down by our constitution.


Thomas Clement (Tommy) Douglas: Did the minister use any of the due processes of law?


Paul Theodore Hellyer: Quite so, Mr. Speaker.


Mr. Speaker:: The hon. member for Okanagan Boundary.


Mr. Pugh:: Mr. Speaker, my question has been asked.



CONSIDERATION OF PURCHASE OF U.S. JET AIRCRAFT

[Stage Direction]
On the orders of the day:
Mr. Erik Nielsen (Yukon):: Mr. Speaker, I have a question for the Minister of National Defence. Can the minister inform the house whether the government has considered the purchase of $300 million worth of pure jet all purpose aircraft from the United States and, if not, when a decision will be made in this regard?


Paul Theodore Hellyer: Mr. Speaker, as I indicated to the house a few days ago, we have been studying our requirements for tactical aircraft for some time. A number of studies have been done but as yet no decision has been taken.


Mr. Eric A. Winkler (Grey-Bruce):: A supplementary question, Mr. Speaker. Should the minister and the departmental officials decide to move in the direction of acquisition of this type of aircraft, will the minister see that included in the plans will be an arrangement to have the aircraft manufactured in this country?


Paul Theodore Hellyer: The urgency for making a decision, Mr. Speaker, is directly related to providing a continuing basis for the aeronautical industry of this country. Strictly from the standpoint of the Department of National Defence we could postpone a decision for some time, but in view of the urgency of giving support to the industry we have been giving early consideration to this matter and hope to be able to make a decision soon.


Erik Nielsen: A supplementary question, Mr. Speaker. In view of the news report last evening on television, can the minister state whether the decision of the government is imminent in this regard, having in mind the supplying of further defence contracts to Canadair in Montreal?


Paul Theodore Hellyer: I would not say it was imminent, but I hope a decision can be taken as soon as we can arrive at what we believe to be the right conclusion.



NATIONAL PARKS


[Stage Direction]
On the orders of the day:
Mr. Lloyd R. Crouse (Queens-Lunenburg):: Mr. Speaker, I should like to direct a question to the Minister of Northern Affairs and National Resources. In view of the fact that the Department of Northern Affairs and National Resources is planning to establish a second national park for Nova Scotia in Queens county and the boundaries at present indicated do not include part of the sea coast, will the minister give consideration to adding a section of coast line either in Lunenburg or Queens county so this park will provide a greater attraction for our Nova Scotia tourist industry?


Mr. Speaker:: May I suggest this is a question for the order paper.



WORLD FAIR


[Stage Direction]
On the orders of the day:
Mr. Colin Cameron (Nanaimo-Cowichan-The Islands):: Mr. Speaker, my question is for the Minister of Trade and Commerce and it arises out of a report in the Montreal Star of September 28 of a speech delivered by the minister's parliamentary secretary, who is quoted as having predicted that among the results of the world fair in Montreal will be a 20 per cent increase in the gross national product and a benefit of $200 million to the national treasury. My question to the minister is this. Were these heartwarming if slightly stupifying predictions based on information supplied to the government by its economic advisers, or are they merely part of the Liberal mystique?
Hon. Milchell Sharp (Minister of Trade
and Commerce): Mr. Speaker, my parliamentary secretary did not consult with me

before delivering his speech, but may I say that the most optimistic and encouraging speeches are made by my predecessor in office Hon. George Hees.



TRANSPORTATION


[Stage Direction]
On the orders of the day:
Mr. H. A. Olson (Medicine Hat):: Mr. Speaker, I should like to address a question to the Acting Minister of Transport based on the reply he gave the house to an inquiry I made about the lack of accommodation on C.P.R. passenger trains between Montreal and Vancouver. In reply he said that every day for the last few weeks some accommodation has been available on The Canadian between many points. Could the minister ascertain from the C.P.R. between how many points there has been no accommodation available, and how many requests from the public for reservations have been turned down since the C.P.R. drastically reduced accommodation on The Dominion?


Hon. G. J. Mcllraiih (Acting Minister of Transport):: Mr. Speaker, I will try to get the information.



AGRICULTURE


[Stage Direction]
On the orders of the day:
Raymond Langlois: Mr. Speaker, I should like to put a question to the Minister of Forestry who is responsible for agricultural development.
On September 25, replying to a question of mine concerning the setting up of an agency to deal with feed grain in eastern Canada, the minister said that this matter was being studied by a committee since last fall.
Now here is my question, Mr. Speaker. When does the minister expect this committee to present a report or a release on the creation of an agency to deal with feed grain in eastern Canada? Has he asked the committee on agriculture and colonization to increase the number of its sittings with a view to submitting its report at the earliest possible time, so that this agency might be formed before fall?


Hon. Maurice Sauve (Minister of Forestry):: Yes, Mr. Speaker, I have been in touch with the chairman of the committee who assured
Inquiries of the Ministry me that the sittings would soon be resumed to pursue the discussion of this problem.


Raymond Langlois: Could he also tell us the approximate date when those meetings will end?


Maurice Sauvé: Mr. Speaker, I am told that we should receive the report of the committee before the end of November.



INQUIRIES OF THE MINISTRY

[Stage Direction]
On the orders of the day:
Mr. Gerard Laprise (Chapleau):: Mr. Speaker, may I direct a question to the right hon. Prime Minister?
Would the Prime Minister tell us whether he has looked into the statement made last Tuesday in Vancouver by the executive vice president of the C.L.C., Mr. Jos. Morris, and does he agree with Mr. Morris when the latter asks for "a social service and allowances system which will enable the unemployed to share the wealth of the community and to play an active part in it", so as to face up automation?


Mr. Speaker:: Surely this question, not being pressing and not requiring an immediate answer, should be put on the order paper.


Lester Bowles Pearson: On a point of order, Mr. Speaker, I believe the question concerned a statement appearing in the press that is alleged to have been made by a private citizen. Surely I am not required to comment on all statements made outside the house by private citizens.


Mr. Speaker:: I would say the point taken by the Prime Minister is well taken.


Mr. Gilbert Rondeau (Shefford):: Mr. Speaker, I had intended to direct a question to the Secretary of State, but in his absence I shall ask the parliamentary secretary to the Minister of Trade and Commerce (Mr. Pepin) to reply.
Does the participation of certain Liberal members of this house in the electoral campaign in Quebec constitute another form of that co-operative federalism which the parliamentary secretary to the Minister of Trade and Commerce is supporting?
8626	HOUSE OF
Inquiries of the Ministry


Mr. Speaker:: Order paper.



ARTS, LETTERS AND SCIENCES SUBSIDIES TO CULTURAL CENTRES IN DORCHESTER COUNTY, QUE.

[Stage Direction]
On the orders ol the day:
Mr. Pierre-Andre Boutin (Dorchester):: Mr. Speaker, may I put a question to the Prime Minister?
Could he tell the house whether his government intends to grant subsidies to the many cultural centres promised by the Liberal party in Dorchester county during the current provincial by-election campaign? If so, is the Prime Minister admitting in this way that operation "agriculture" having failed in that county, it is now being replaced by operation "culture"?


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


Gilles Grégoire: Mr. Speaker, on a point of order.
I think this is a very urgent matter as there is going to be an election next Monday, that is, in four days, so that it is clearly too late to put this question on the order paper.
Throughout the county of Dorchester the Liberal party are promising cultural centres for the Dorchester electors. We would like to know whether before Monday, the day of the election, the federal government intend to pay for all these centres connected with the centennial of confederation in the Dorchester municipalities.
That is why an answer must be considered as urgent at this time.


Mr. Speaker:: Order, please. I suggest that the question should be put on the order paper.


Pierre-André Boutin: Mr. Speaker, on a point of order. I must inform you that I intend to raise this question tonight at ten o'clock. [Text]



PRINCE RUPERT. B.C.-INCREASE IN ELEVATOR CAPACITY

[Stage Direction]
On the orders of the day:
Frank Howard: I wonder if I might direct a question to the Minister of


Agriculture, and ask him if he has anything to relate with regard to the grain elevator at Prince Rupert, especially in view of the fact there was virtually a promise made about it on the eve of April Fool's day.


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


Frank Howard: If I may be permitted, I should like to say that Your Honour has consistently permitted me to ask questions precisely in the same way I have just asked this question now, with the exception of the reference to April Fool's day.


Mr. Speaker:: I would simply say to the hon. member that two wrongs do not make a right, and if I have been wrong in the past I am about to correct it now.


Frank Howard: May I be permitted to hope you pursue that course diligently.



EDUCATION


[Stage Direction]
On the orders of the day:
Mr.  R. Gordon L. Fairweather@Royal: wonder if the parliamentary secretary to the Minister of Finance would take notice of this question for an answer as early as possible. Is it a fact, as I have been informed, that university students from Quebec studying, for example, at the University of New Brunswick, are disqualified for student loans for two reasons; one, to be eligible for a loan from the New Brunswick allotment they must have 12 months residence in New Brunswick; two, under the Quebec plan they must attend universities in that province in order to qualify?


Lawrence T. Pennell: I am pleased to accept the hon. member's suggestion.



INDIAN AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. Gene Rheaume (Northwest Territories):: I wonder if the Minister of Citizenship and Immigration can say whether the governments of the Yukon and Northwest Territories will be participating as observers at the forthcoming federal-provincial conference on Indian affairs.


Hon. Rene Tremblay (Minister of Citizenship and Immigration):: Mr. Speaker, no decision has yet been made in this connection, but the hon. member's suggestion will be considered.



LABOUR RELATIONS


[Stage Direction]
On the orders of the day:
Allan Joseph MacEachen: I wonder if I might answer a question asked yesterday by the hon. member for Villeneuve concerning the suspension of stevedores in Montreal. The information I am giving is based on press reports, and it would appear that the Canadian national trade union has been conducting organizing activity among longshoremen on the Montreal waterfront. Two members of local 375 of the international longshoremen's association were assisting the C.N.T.U. and, it is said, sought to enroll other longshoremen. As a result they were suspended from I.L.A. membership and this has affected their employment under the terms of the collective agreement between the employers and the union.
It would appear that the suspensions of the two men were made by the Canadian officers and members of the Montreal local and not by the international union itself. Under the constitution of the organization, suspended members have a right of appeal to the higher officers. Following procedure under the constitution of their organization, they could also have recourse to the Industrial Relations and Disputes Investigation Act and the courts, if it is still felt that their rights have been violated.


David Réal Caouette: Mr. Speaker, I want to ask the Minister of Labour a question following the answers he gave to the questions I asked yesterday.
It is understood that there is a collective agreement between the Montreal stevedores and their employers. The minister now tells us that those two citizens, those two longshoremen, were suspended from their jobs until December 31. What statute of this country, or what legislation under the Department of Labour can stop a longshoreman who is dissatisfied with his own union from working in favour of a different union, whether it be the CSN, as in this case or another?
Inquiries of the Ministry
On the other hand, will those longshoremen be paid unemployment insurance benefits? At this time they are barred from doing so.
Can the minister affirm that the longshoremen will, at least, have the right to receive unemployment insurance benefits, over and above ensuring them the right to affiliate with another union, if they want to do so. After all, we are living in a democratic country where the individual freedom of each citizen should be unreservedly protected.


Allan Joseph MacEachen: Mr. Speaker, I regret having failed to add that I am still awaiting information with respect to the status of these persons under the Unemployment Insurance Act. Just as soon as I receive the information I shall give it to my hon. friend.


Gilles Grégoire: A supplementary question, Mr. Speaker.
Will the minister inquire from the two stevedores who were laid off in order to find out whether the real reason of their suspension does not lie with the Montreal longshoremen's association, where a large group would like to become members of the CSN rather than of the international longshoremen's association? Efforts are being made to keep them from doing so, and that is a violation of the most sacred rights of freedom of union.


Allan Joseph MacEachen: As I stated earlier, Mr. Speaker, if these persons feel their rights have been violated there are certain courses open to them, namely to appeal under their own constitution for further adjudication; and if they wish to seek recourse under the Industrial Relations and Disputes Investigation Act they can make an application under it. They can also seek to have the matter determined in the courts. As can be seen from this, there are a number of methods open to these persons to have the matter determined without any action to be taken by the Department of Labour.


Gilles Grégoire: Is the minister suggesting they should appeal to a higher official of the-


Mr. Speaker:: Order. We have spent a great deal of time on this question and the minister has attempted to give a rather complete answer. I have allowed fuller questions than are usually allowed, in order to give some recognition to the rights of individuals, but
8628	HOUSE OF
Inquiries of the Ministry I do not think we should take any more time of the house on this particular matter. Hon. members should consult the minister privately, or else put their questions on the order paper.


David Réal Caouette: Mr. Speaker, on a point of order. The Minister of Labour made a statement and we are trying to get detailed information. I think we surely have a right to ask the minister to whom these five stevedores must apply for appeal, so as to secure a hearing or submit their grievances.
Should they appeal to officials of the union, to a branch or an agency of the Department of Labour?
We want full particulars on this matter and I suggest that this is where we should ask questions and try to get the accurate details we most earnestly seek.


Mr. Speaker:: I am sure if the hon. member put his questions on the order paper once more he would get a very detailed answer, and he would also save the time of the house.



LABOUR CONDITIONS

[Stage Direction]
D.E.W. LINE-SITUATION RESPECTING LABOUR DISPUTE On the orders of the day:
Allan Joseph MacEachen: In connection with the questions asked concerning the dispute on the D.E.W. line, I am advised by the Winnipeg officer of the department, who was the mediator in this situation, that to his knowledge there was no intimidation practised by anyone to influence the outcome of the dispute. It will be recalled that the parties had agreed on September 22, during their discussions before the entry of the mediator, that there would be no strike, and they proceeded to put this undertaking into writing. I think I should say also that the parties concerned in this dispute were very well aware of their responsibility to keep this vital defence line in operation, and that is why they reached agreement that there would be no strike and that any issues still in dispute at the conclusion of negotiations would be submitted to final and binding arbitration.



FINANCE

[Stage Direction]
NEW TAX POLICIES FOR POTASH FIRMS USING SOLUTION METHOD On the orders of the day:
Mr. K. H. More (Regina Cily):: Mr. Speaker, my question is directed to the Minister of 

Finance, and his parliamentary secretary can take notice of it. On Tuesday morning, 30 miles west of Regina, the $50 million Kalium Chemical plant, the first in the world to successfully use solution mining for recovering potash from great depths, was opened. At a press conference in Regina that morning the premier of Saskatchewan said that "Gordon's tax policies" regarding this new industry are stupid and short sighted. Will this forthright statement of the premier of Saskatchewan prompt the minister to give bold and imaginative consideration to new tax policies to encourage further development in this new field?


Lawrence T. Pennell: Mr. Speaker, the Minister of Finance is not accountable for the short-sightedness of the gentleman to whom the hon. member attributed this statement.



UNEMPLOYMENT INSURANCE


[Stage Direction]
On the orders of the day:
Raymond Langlois: Mr. Speaker, I had intended to put a question to the Minister of Labour earlier, but because of the numerous questions that followed I retired from the field.
Is it the intention of the minister to study soon the Gill commission report on unemployment insurance and on unemployment now prevailing in Canada? This report was presented several months ago.


Allan Joseph MacEachen: As I have stated on several occasions, Mr. Speaker, the recommendations of the Gill committee are under examination, and the situation with respect to action on the report was outlined by the Prime Minister at the opening of the session.


Raymond Langlois: May I ask a supplementary question of the minister and-


Mr. Speaker:: Order, please. I do not see any particular urgency in this question, which has been raised frequently during the last few weeks.


Raymond Langlois: If I may put one short question, it may not be of urgency in one particular region but it is of particular urgency with respect to the unemployment situation across the country. We have had frequent
answers from the minister that the recommendations are under consideration. I would like to ask under consideration by whom?


Allan Joseph MacEachen: The government.


Mr. Speaker:: Orders of the day.


Raymond Langlois: As a supplementary question, isn't the Minister of Labour-


Mr. Speaker:: Order, please. Orders of the day.

The house in committee of supply, Mr. Lamoureux in the chair.



DEPARTMENT OF TRADE AND COMMERCE

[Stage Direction]
General administration-
1. Departmental administration including fees for membership in the international organizations listed in the details of the estimates, $5,180,500.
The Chairman:: Shall vote No. 1 carry?


Hon. Mitchell Sharp (Minister of Trade and Commerce):: Mr. Chairman, the Canadian
economy is now in its fourth year of advance and is moving strongly ahead. The rise in Canada's gross national product this year surpasses even the 6.6 per cent increase of 1963. Employment so far this year is up 4 per cent from the same period a year ago. Despite a more rapid expansion of the labour force, there are fewer people without jobs.
The general advance has been widely diffused throughout all major segments of industry and all geographic regions. Output in secondary manufacturing industries has continued to grow, service trades and construction have been more active and substantial gains are also being realized in resource industries.
Canada's 1963-64 crop year, which ended July 31, was the most successful wheat marketing year in the nation's history. It was a record year for production, exports and income, in each case well above previous highs. It is a year that will be difficult to match.
A number of importing countries have harvested large crops this year. Nevertheless the outlook for wheat exports is favourable. Canadian wheat is ideally suited for blending with the indigenous soft wheats produced in these countries. Agreements concluded with mainland China and several eastern European countries assure a continuing heavy movement to these markets. Forward sales for the current crop year are encouraging. In short, 1964-65 is going to be a good year for exports of wheat.
Internationally, economic conditions remain generally good, with world production

Supply-Trade and Commerce and trade moving steadily higher. Sales of Canadian products have been more than holding their own in international markets. Rising exports have played a major role in Canada's current expansion. For the period 1960 to 1963 Canada's merchandise exports rose by 30 per cent or nearly 10 per cent each year, and so far this year they are up by a spectacular 23 per cent from the same period in 1963. Even exclusive of wheat, exports are up by 17 per cent. Items contributing in a major way to this increase include lumber, pulp and paper, iron ore, base metals, aircraft and automotive products. Especially encouraging is the further growth in a wide assortment of manufactured goods which, as a group, are assuming increasing importance in Canada's export trade. Canadian manufacturers continue to break new ground in terms of both the broader range of products sold and the growing number of markets penetrated. A significant part of this growth in sales of manufactured goods consists of capital equipment sold under long term financing arrangements of one kind or another, either insurance or direct financing by the government under the Export Credits Insurance Corporation. All major foreign markets have absorbed more Canadian products this year. Exports to the United States are up by 11 per cent, to Britain and the rest of the commonwealth by 21 per cent, to the European economic community by 25 per cent, to Japan by 18 per cent.
The encouraging state of Canada's trade at present does not, of course, mean that those concerned with its promotion can now rest comfortably on their oars. There is nothing static about foreign competition for international trade, and in our promotion activities we look to the years ahead. Moreover, prosperity presents its own special challenges. It is, for example, anomalous but true that Canada's economy is perhaps more vulnerable to external imbalance in good times than in bad. I think the comment that was made today on the orders of the day, that there was some adverse change in our current account balance, was simply an indication that we were very prosperous.
This year's accelerated growth in the Canadian economy accompanied by sharply expanded capital expenditure programs has entailed a new upsurge in import demands. So far in 1964 merchandise imports are up by 19 per cent and payments for non-merchandise items are also up sharply. Thus, the virtually unprecedented rise in export earnings this year has scarcely been adequate to meet the
8630	HOUSE OF
Supply-Trade and Commerce rise in foreign payments. Consequently our current account balance, which last year showed the smallest deficit-about $500 million-in the last nine years, has shown no further improvement this year. Figures recently released by the dominion bureau of statistics show a current account deficit of $518 million for the first half of 1964 compared with a deficit of $452 million for the same period last year. A moderate improvement in the merchandise trade balance has been more than offset by higher net payments on non-merchandise items; in other words, the trade surplus has again grown fairly substantially but it has been offset by these invisible items. These developments illustrate how important it is, even in present conditions of mounting prosperity, to push resolutely ahead with programs to extend our productive capabilities on the basis of competitive efficiency and to develop new markets. It is against this background of solid accomplishment but continuous challenge that the department is pursuing its role of helping to pave the way and to stimulate an ever-increasing flow of Canadian products into the markets of the world, wherever they are to be found.
I would now like to say a word about international trade relations. We are in one of those periods of transition where old trading patterns gradually give way to new. No country can afford to ignore the currents or to lag behind in adapting itself to the changes that are taking place. Especially is this so in the case of Canada, where the further development of our trade and the growth of our economy require that we should exploit every opportunity to gain access to wider markets. Better access to the United States and other markets could, in many cases, provide the necessary incentives for longer production runs and increased specialization, which are so necessary to many of our secondary industries. Improved access would also open up possibilities for the development of new products and for the initiation of new export trade.
The intensive phase of GATT trade and tariff bargaining gets under way in November. While there was some lull in the preparatory work in August, meetings of experts are now being resumed in Geneva with the objective of clearing away remaining difficulties in time for the November 16 deadline. On that date the participating countries are scheduled to begin their detailed bargaining behind closed doors.


The Canadian tariffs and trade committee has now pretty well completed its initial task of receiving briefs and conducting consultations with various Canadian interests. The interest shown by the business community has been most encouraging. More than 400 separate briefs have been received by the tariffs and trade committee. The committee has been going non-stop all summer-like parliament- in receiving interested groups which have been asked for hearings. Our delegation, under the chairmanship of Mr. Norman Robertson, will be entering the negotiations in Geneva better briefed on the views and interests of the various Canadian groups than ever before. The tariffs and trade committee here in Ottawa, under the able and experienced leadership of Mr. Hector McKinnon, will be available as may be required to provide a vital and continuing link between our negotiations in Geneva and the Canadian business community. Some of our negotiating team has already left for Geneva for the final preparatory phase of the negotiations. We expect that the full delegation will be on the ground after the end of the year.
I would not try at this stage to predict the duration of these negotiations, or the final outcome. They will be of great importance to the international trading community and we can expect them to be long and difficult. The task ahead and the challenge the negotiations present fully justify the time and effort required. Special efforts will be necessary to ensure a meaningful negotiation in the agricultural sector. Canada's interests in the negotiations are positive and clear. It is through the opening up of markets on the broadest possible basis that our own trade and economic interests can best be served. In the process concessions will be required in return for benefits received. Our participation will be carefully developed in the light of the national interest and the opportunities presented. We shall be striving for maximum Canadian advantage. As I have said on some other occasions, we shall be tough but not reluctant bargainers.
A most important task of the I960's is to reinforce the efforts of the less developed countries to improve the lot of their peoples and to reach the point of self-sustaining growth. The United Nations trade and development conference laid bare the magnitude of the task and the urgency of the demands of the less developed world. The conference also laid the basis for carrying the work forward through new international machinery devoted exclusively to the problems of trade

and economic development. The Kennedy round of negotiations provides an early opportunity to assist the developing countries through better trade access. The major trading nations, including Canada, have agreed that maximum efforts should be made to open up trading opportunities for the developing countries. Special procedures are being worked out to ensure that the interests of the less developed countries are kept fully in mind.
The United Nations general assembly this autumn has the trade problems of the developing countries high on its agenda. The GATT countries will be having a special session this autumn in Geneva-I expect that my deputy minister will be attending as the chairman of GATT-devoted especially to possible changes in the international trading framework designed to take better account of the trade needs of the developing countries. Canada has played, and will continue to play, its full part in these endeavours.
It is no small achievement that during this period of pause, when the leading trading nations have been preparing themselves for further progress in the direction of international trade and economic co-operation, restrictionist pressures have on the whole been resisted by our trading partners. While some problems of access have been encountered, these have been the exception and Canada's exports to the United States, Britain, the European economic community and Japan have all been running at record levels.
Japan has now become Canada's third largest market and the prospects are for even higher import requirements for the years ahead. The pace at which Japan has been opening up its market to import competition may at times give rise to impatience. Nevertheless, Japan has moved a long way in the last several years. Japan herself has had trouble in gaining improved access to markets for its products. Of key importance is that the movement has been in the direction of freeing up trade and not away from international economic co-operation.
We have been doing well in the British market. Canned apples were freed from import controls in June, and very few of the United Kingdom post-war trade restrictions now remain. I am glad to see that my hon. friend who formerly had responsibility in this matter is smiling, because I know from his experience and from my own how many years it has taken to get rid of canned apples.
Supply-Trade and Commerce


Mr. Nowlan:: Hear, hear.


Mitchell William Sharp: We are actively pursuing with the British authorities the question of better access for our fresh apples and pork products.
The department has of course followed developments in the United States with particularly close attention. Certain important sectors of our trade have been the object of protectionist pressures, notably oil and lumber, but restrictive measures have been avoided. We are frankly disappointed that the United States has, so far, not felt able to free up the trade in lead and zinc, particularly during this period when the market has strengthened. Lack of substantial progress in easing the United States restrictions on Canadian cheese is equally disappointing. And we are determined that the objectives of our automotive program should be achieved. It is easy to harp at the United States, and we have our problems. But it is important to keep in mind the extent to which new trade restrictions have been avoided and the great potential which exists for expanded trade and fruitful economic co-operation with our major trading partner, the United States.
In its external trade promotion work, the department is building purposefully upon the foundations established by past projects such as the national export trade promotion conferences, the regional trade promotion meetings, and the various sample shows. Those imaginative projects stimulated greater interest in exporting, identified opportunities and potentialities, and pointed to ways and means of capitalizing on them. They induced a gratifying extra momentum to the export activity of our business community.
Our task is always to service expanding interest in export trade, to exploit gains which have been made, as well as to broaden and diversify the base of our trade in continuing to seek new prospects and to avail ourselves of additional export possibilities as these are discovered. As the pattern of our trade develops, new methods must develop with it. The guiding work principle is "promotion in depth"-intensive, detailed, painstaking effort. In particular, attention is being paid to export development for secondary manufactures. Our export manufacturing base is widening in a most encouraging way. As instances of success at export multiply, more and more businessmen are gaining confidence in their competitive capacity in world markets.

Supply-Trade and Commerce
Whether it be in our dealings with individual firms or with trade associations; in the bent of our trade missions program or the purpose of our trade fairs program; in the establishing of further regional offices within Canada or new trade posts outside our country; in special activity such as our efforts to encourage the export of Canadian consultant engineering services or our work in developing the export of Canadian-made components needed by overseas industries; in selling bulk or packaged foodstuffs and other agriculture or fishery products or in exporting industrial raw materials or manufactured products-in every area we are working intensively and with purpose. Canadian businessmen are responding to the opportunities and to the challenges in a most gratifying way.
The department's aim is to remain flexible, responsive to fresh opportunities. Prospects, trends and potentialities are kept under constant review. We are constantly adapting to new environmental changes, new developments, and we shall continue to do so.
In our efforts at external trade promotion we are co-operating fully with all provincial trade departments and I am glad to say they are reciprocating in like degree. In matters of mutual interest and concern there is sensible exchange of views at the planning stage, practical collaboration in the organizational phase, effective joint effort at time of execution. I am satisfied that much mutual benefit has already accrued. Indeed, when I first met with the ministers and my opposite numbers in the provincial governments I said I thought that this cooperation was a very good example of cooperative federalism. My officials and their opposite numbers in the provinces have developed intimate and effective relationships that augur well for the future.
In that other important sector of our promotion work, tourism, there is every indication that the Canadian tourist industry will achieve another record year in dollars earned from visitors to this country. The tourist bureau is working to a three year development plan designed to bring tourist earnings to a total of a billion dollars in 1967. This will require a very considerable effort and investment. Good progress is being made and I am confident that the imagination and determination being shown will yield results of which we as Canadians can all be proud.
Hon. members will be interested in the program called "Project Hospitality" which

the travel bureau inaugurated through the Canadian tourist association. Project hospitality consists of a series of seminars and local hospitality conferences in every province aimed at the operator or service level. The objective is to raise the standards of reception and service provided to our visitors. Results to date are very encouraging.
Through the annual federal-provincial tourist conference to be held in Ottawa in November and by continual, almost daily, consultation with the provinces and the transportation companies covering all kinds of promotion activities, the travel bureau continues to provide leadership and a means of co-ordinating promotion of travel in Canada both at home and abroad.
As regards Expo '67, good progress has been made and the corporation advises that preparations are on schedule and prospects for foreign and domestic participation most satisfactory. Hon. members have had an opportunity to be briefed on the striking plans which have been developed for federal and provincial participation in this great centennial event.
A number of questions have been raised regarding the relationships between the Department of Trade and Commerce and the new Department of Industry. They were raised particularly on the estimates of the Department of Industry. There is no need for any confusion on this matter. Those relationships are precisely similar to those existing with the departments of agriculture, fisheries, forestry and mines and technical surveys. The prime responsibility for matters affecting export trade and trade promotion rests with the Department of Trade and Commerce. To the extent that the Department of Industry is successful in increasing productivity, improving the competitive strength of Canadan industry and expanding the range and volume of Canadian industrial production, it will develop new fields of opportunity for export trade development. Officials of the two departments are working in the closest collaboration; their efforts are complementary and mutually reinforcing.
As hon. members are aware, I have responsibility as Minister of Trade and Commerce for a number of boards, crown corporations and agencies which report to parliament through me, but which are not part of the department as such. When we come to the votes covering the estimates of these boards and agencies I shall be pleased to comment or to answer any questions. At this stage I

should like to refer briefly to the operations of the dominion bureau of statistics and the national energy board.
Hon. members will be asked to approve a small sum to undertake preliminary work for the quinquennial 1966 census which will again be taken for Canada as a whole as it was in 1956. The questions to be asked for the population will be limited, as was the case in 1956, to some five basic questions- age, sex, marital status, relationship to head of household and whether living on a farm- plus a question on type and tenure of each occupied dwelling. For agriculture, questions will be asked about the number and size of holdings, type of farm, crop acreages, number of livestock and farm machines and limited information on expenditures.
Since I announced our national power policy to the house a year ago, the board has been engaged, directly and in association with other agencies, in various studies bearing on the implementation of that policy. As the house is aware, the board is also responsible for advising the government on the progress of the national oil policy. Earlier this year I expressed the view that average Canadian production of crude and equivalents should reach about 850,000 barrels a day in 1964. It now appears that this level will be very nearly achieved and that the industry will enjoy an increase of the order of 7 per cent over last year or more than 50 per cent above the level of average production in 1960.
The adjustments inherent in any such program require the constant participation by the board in discussions with companies in the industry, but I think the difficulties have so far been met by the industry and the board with a remarkable degree of success, both in terms of the adaptation of the patterns of the industry within Canada, and in terms of orderly development of the markets in the United States for Canadian oil. The process has not been painless and difficulties remain, but the industry is certainly to be congratulated on what it has so far achieved.
In closing my remarks I should like to stress again the need for Canada to respond appropriately to the basic shifts in the world trading environment that is taking place. Canada is a great trading nation. To maintain and improve our prosperity and our standard of living we must consolidate and improve our position as an international trader.
In the months ahead we can expect keener competition at home and abroad in our efforts to maintain and expand markets for primary products and for secondary manufactures.
Supply-Trade and Commerce We should set our sights on meeting this keener competition, and on adjusting our posture and improving our efficiency to take advantage of broader markets. We must remain competitive if we are to maintain and expand our place in the Canadian market and in the markets of the world. I am confident that Canadian industry can and will respond to the new opportunities and new challenges.


Gordon Minto Churchill: May I just ask the minister a question. Would he in concluding his remarks list the various agencies or crown companies for which he has responsibility so that we have them all together in his address?


Mitchell William Sharp: The Canadian wheat board- and this is not an agency but a responsibility, the corporation and labour unions returns act, which we were discussing this morning during the banking and commerce committee meeting, and the returns for which are collected by the bureau of statistics; the Exports Credits Insurance Corporation, the national energy board and the bureau of statistics. I also have responsibility for the Eldorado Mining and Refining Company and Expo '67.


Gordon Minto Churchill: The board of grain commissioners is not included?


Mitchell William Sharp: No, it is not.


Mr. Lambert:: Mr. Chairman, it will be appreciated that it will be rather difficult to comment in detail on the minister's presentation. I am not complaining, but the minister's rate of delivery is rather rapid. I am not a shorthand writer and he has the advantage of a text, which he follows rather closely, copies of which we have not received. I again draw his attention to a request made by members on this side, as well as on all sides of the house, to the effect that if members of the cabinet are presenting statements and do so from a lengthy and involved text, they should exercise the courtesy of providing party leaders or representatives with copies. After all, the reading of a text by a minister in opening a discussion on his estimates is done with the tolerance of the members of the house and the Chair. Otherwise, if we want to follow the rules strictly, the minister would have to make such a statement spontaneously without a text. If you will permit me to digress slightly, Mr. Chairman, I think this is perhaps one area where things could be improved. Either we should accept the fact that a minister is going to make a statement from a text and have
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Supply-Trade and Commerce copies distributed, or the minister should follow the rules and get along without a text.
Be that as it may, I found the minister's statement this afternoon, at least at the beginning, to be rather generalized, and that it painted a picture in rather glowing colours. There was an unfortunate dearth of what one might call hard figures, comparing the progress this year with progress of the past. I should have liked to hear a great deal more detail about what he foresees for the future, and I will deal with that subject more extensively at a later time.
In following the minister's statement I made an attempt to compare it with a speech he delivered to the Canadian Chamber of Commerce annual meeting in Winnipeg on September 28. The two statements were made within a short period of time, and naturally the facts existing on the one occasion cannot be separated from the facts which existed on the other. These facts would not change. Therefore we find a similarity of thought expressed in both statements.
It is interesting to observe that the notes of caution I intend to make this afternoon may be in contrast to what the minister intended in the opening remarks of his statement. What I say is certainly not in the spirit of doom and gloom, which we have observed on the part of his colleagues who were formerly on this side of the house. Though the minister was not here then, I am sure he would blush if he heard or read some of the statements that were made then, in view of some of the things he said in his Winnipeg speech. I should like to quote from that speech, where he said:
The Canadian economy is now in its fourth year of uninterrupted advance and substantial gains are being made this year.
It is too bad the hon. member for Essex East and a few of his fellow gloomsters of the past three years were not in attendance to hear this glowing report in respect of the nature of the economy as it stands today.
The minister has indicated a need for action in certain areas, and I think we should underline these areas. Certainly during the past six or seven years there has been a considerable increase in both exports and imports, but there is a question arising in respect of whether there will be a sufficient increase in exports to more than counterbalance the increase in imports. Is the increase in exports going to be sufficient to even keep pace with the vastly increasing payments on the foreign accounts, which have to be made on the noncommodity side, for interest, dividends and


repayments? We know that from 1946 and 1947 to 1955 and 1956 there was a continuous and fantastic deficit on both the commodity and non-commodity side. There was a surplus on the commodity side I think in 1952, but that is the only exception.
Those deficits in international accounts were made up, so far as we were concerned, and this is what tended to keep the Canadian dollar at an artificially high level for a period of time. The deficits were actually invested in Canada but not necessarily in new investments. A good deal of the deficits were invested in other than new investments and we observed a good deal of purchases in industry made in Canada by foreign interests. These purchases were not all made by United States interests, but by other foreign interests as well. However, the more of this foreign investment there is as the result of a deficit in the international account, the more we must face up to the fact that we are going to have to repay this in some way in the future. Every time we borrow money on the foreign market we must take into account the fact that we are going to have to repay it.
Year by year we see this non-commodity item gaining on us. In fact, the situation is almost similar to a treadmill. This is the price we must pay for the progress that is being made in this country. I am not suggesting this is entirely wrong, but we must realize that this is a price we must be prepared to accept. If we ignore that fact I think we are guilty of very careless thought.
The minister referred to the export of apples from Halifax to the British market. Just as an aside, I should like to point out that I noticed a statement on one of the financial pages of a local daily newspaper which pointed out that the major processor of Ontario apples into apple juice is under British control. Instead of exporting our apples over to Great Britain they have taken over control of this processing industry and process them here.
I should like now to refer again to the speech made by the minister in Winnipeg. I have noted that from 1960 to 1963 exports on the commodity side increased by 30 per cent and that up to this time this year they are-in Winnipeg the minister used the word "whopping".


Mitchell William Sharp: Spectacular.


Norman Platt Lambert: Spectacular. I think we all realize that wheat and wheat products have a good deal to do with this, but there are other things. I hope that later the minister

will be able to put on record the increase in sales of natural gas, because there has been quite a considerable advance. It has not been so much in the case of oil, although there has been good maintenance of that market. I intend to discuss the national oil policy.
With regard to the Kennedy round and GATT I believe my colleague, the hon. member for Digby-Annapolis-Kings, will be taking up that subject later. There are also other aspects of the minister's speech and responsibilities that some of my other colleagues will comment upon. Certainly the operations of Eldorado will come under the scrutiny of the hon. member for Edmonton-Strathcona or I miss my guess.
I have the text here of the minister's speech in Winnipeg, and I think that the minister will agree, as will members generally, that there has been a very healthy development in that the increase in the volume of our exports, both as to quantity and as to price, has been in manufactured goods. I think it would have been necessary for us to pause and look at the situation much more closely if this had not been the case. If the increase were limited to basic or prime products then we would merely say that we were continuing and expanding our career of being hewers of wood and drawers of water.
I suggest to the minister that a good deal of the progress has been the result of the programs of really accentuated trade promotion that took place five or six years ago and extended into 1960 and 1961. I was a little disappointed that the minister, when speaking of trade promotion and trade conferences, did not indicate that there were any plans for a repetition of the very successful conference, confrontation, or whatever you want to call it, of our trade commissioners and members of Canadian industry. This took place on the largest possible scale in 1961 or late 1960. I think it certainly revitalized a whole section of the minister's department. I believe it has led to an entirely different atmosphere and has created a feeling of cooperation which has resulted in a large number of regional trade conferences between men in business and officials of the minister's department. It has led to greater co-operation between the federal Department of Trade and Commerce and the various provincial departments of trade and industry.
I would hope that the minister could announce that before long there is going to be another of these rather large gatherings, because as I participated in that conference
Supply-Trade and Commerce I was able to observe the reaction of businessmen from western Canada, particularly from the province of Alberta, and many of our trade commissioners that this was the dawn of a new day. I do not say that conferences of this kind are necessary every year or every second year, but five years will soon have elapsed and I think another one is now called for.
Competition at the international level today is so acute that if Canada is not only to maintain its position but also to go forward there must be a really active, hard sell. People will not come here to buy. They will not walk in on their own. There must be aggressive selling. People can be brought here but they must be encouraged. I wish to congratulate the Department of Trade and Commerce and the minister for having maintained some of the momentum, but I do not think there has been quite the same momentum and I should like to see it picked up.
In Winnipeg the minister warned that unfortunately there has not been the same rate of progress from 1963 into 1964, that is, the same sort of optimistic upturn in our external accounts. There has been a great deal of capital spending which, as he says, has resulted in a resurgence of import demands. The fine increase on the export side has been matched by an increase in imports. If we leave wheat sales aside the 17 per cent increase on merchandise account is matched by a 17 per cent increase in merchandise imports.
But again I come back to the point that there has also been a very significant increase in the non-merchandise account, and it is the non-merchandise account that is most worrisome and the sector over which we have the least control. In the minister's address I noted the following sentence:
It is not unusual that we should continue to experience a sizeable balance of payments deficit on current account in circumstances of rapid expansion such as now prevail. I have no doubt that a deficit of present proportions can be financed without difficulty.
Right away I ask: But for how long can we continue in this position and what has really been the price of past deficits? This is what concerns me. It may be that in a single year we can finance such a deficit without an undue drain on our foreign exchange holdings, but on the other hand it cannot be said that we can continue to do this. It seems to me that all too often we take the easy way out, like the man who is slowly going bankrupt and pays off his shortfall accounts by merely selling his assets. Eventually he will
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Supply-Trade and Commerce run out of assets and then he comes up against the startling reality that he is bankrupt. This is something we must guard against.
The minister indicated that the aim of his department was to improve and to extend the Canadian industrial structure, and to do this not by restrictive measures but by maintaining a suitable economic climate by the right kind of incentives and by the promotion of exports. Well, I am just wondering. We have noticed that this year, in the second quarter, there has been a levelling off. I am hoping that the minister has been discussing this levelling off with his colleague, the Minister of Finance. Every time there is an upward drive in the cost of production of manufactured goods, the problem of our export trade becomes more difficult.
I would say immediately that one of the restrictive measures involved in so far as export trade is concerned was the imposition of a sales tax on machinery entering into production. I have not at any time been able to see the justification for the imposition of this tax on production machinery when we are trying, with all our might and main, to drive up our exports. I do not know of any other country that has done this. Surely to goodness this is something that I hope the minister will be able to take care of in discussion with his colleague.


Mitchell William Sharp: I wonder if the hon. member, while he is making this point, would discuss the implication of the 43 per cent increase in exports in June, which is during the period to which he has referred?


Norman Platt Lambert: The increases are not looked at month by month because it takes just a mere accident of shipping or certain other things to influence the comparison on a month to month basis. I could perhaps say that the 43 per cent would be accounted for by the hurry to complete the wheat deliveries. There may be a number of factors. If the minister is talking about a 43 per cent increase in June of this year as compared with June of last year, then that is a short space because you can see increases or decreases of perhaps 100 per cent from one day to the next.


Mitchell William Sharp: I was just commenting on the statement the hon. member had made, that during this period there was some slackening of exports. I was pointing out that June was the largest monthly increase we had had in the whole year.


Norman Platt Lambert: I said there had been a sort of levelling off, not a slackening or a drop.


There is a levelling off. I should like to draw to the attention of the minister perhaps some of the conclusions that have been drawn from the reports issued by the dominion bureau of statistics, in so far as the gross national product is concerned and a few other things that perhaps go to counter balance some of the glowing statements the minister made at the beginning. I should like to cite from a commentary made on the situation which appears in this morning's financial press:
A midsummer slump in business activity may have dimmed hopes for a balanced federal government budget this year.
The gross national product showed no advance in volume in the second quarter, a 1 per cent increase in value, to an annual rate of $46 billion, being matched by a 1 per cent rise in prices. The non-farm output of goods and services dropped in volume by about one half of 1 per cent.
The fall in non-farm production, the first since early in 1961, was accompanied by a slackening in consumer demand, a build-up of manufacturing inventories and a 1 per cent decline in corporation profits.
I am not saying we are on the eve of a disaster. However, I want to point out that there are certain things which we cannot ignore, and we must not go around with our heads in the clouds saying that all is well in the best of all possible worlds. There are difficulties.
If I may turn to another aspect of the minister's speech in Winnipeg-and I should like to apologize to the committee for concentrating on this-there was one aspect in which I can support him entirely. This is when he says:
The fact that domestic trade takes place in a more familiar and predictable environment, and therefore with less conspicuous effort, should not be interpreted to impute an inferior role to this part of our commerce. On the contrary, the benefits accruing from the exchange of goods and services are equally real, whether achieved in a national or international framework. Canada's voluminous inter-regional trade flows are, in fact, a key pillar of our economic strength and the relative ease with which this movement occurs in no way detracts from, but rather adds to, its value. We would, I am afraid, become painfully aware of the tremendous contribution of inter-regional trade to our economic life were we to experience a serious disruption to the free flow of goods and services, and productive resources generally, across provincial borders. At a time when larger trading units are emerging throughout the world by way of customs unions and free trade areas, it is doubly important that we fully appreciate the value of our unrestricted domestic trade.
I suggest that it should be one of the primary objectives of this chamber of commerce-
I think of all Canadian businessmen and of all governments, if I may interpolate.

-and of its members to resist the efforts that are sometimes made to hamper the free movement of goods within Canada.
Now, Mr. Chairman, yesterday afternoon I had the oportunity of making a short intervention in the debate, at which time I stressed a similar point. I should like merely to refer hon. members to the remarks I made there and not repeat them. However, I will not back away from them.
Now, may I turn to the national oil policy which was enunciated on February 2, 1961? The minister has told us that production now is about 850,000 barrels a day, and this includes both the domestic market and the export market. At the time the policy was enunciated, if my memory serves me correctly, production was about 630,000 barrels a day. As the minister indicated progress has been made, but not without some difficulty. This was anticipated both by the industry and the government. The attitudes of both were appreciated at the time and it certainly is to the credit of the industry that they have been able to continue this achievement.
The national oil policy was a prediction on a five year basis. We are now approaching the end of 1964, and I should like to hear a good deal more from the minister with regard to oil and gas. The mere fact it is more or less concentrated out in the prairies and in northeastern British Columbia should not detract from its importance. After all, petroleum is the most important mineral in Canada today, in so far as production is concerned. I have here, Mr. Chairman, a publication entitled, "What the mining industry means to Canada", published by the Canadian metal mining association. I received it today. It certainly has some very illuminating statistics at the back, and I commend them to hon. members, showing precisely what the mineral industry means to this country.
It must be remembered that oil and gas are minerals and they form a great part of our mineral production in each year. Now, in 1963, the total mineral production in Canada was valued at $2,976 million. Of this, mineral fuels, which are coal, natural gas, natural gas by-products and crude petroleum made up some $882 million.
It may not be realized that the province of Alberta produces the second largest amount of minerals in the country, on a dollar basis. In fact it produces 21.3 per cent of Canada's mineral production, exceeded only by the province of Ontario which produces 29.4 per cent. I admit this is primarily oil and gas. There is some coal, but when we look at the
Supply-Trade and Commerce production of mineral fuels in western Canada, and what these fuels mean both to our domestic and foreign market then I feel sure the minister will agree that he needs to pay a great deal of attention to them.
The industry has problems. It is operating in a very limited sphere so far as the export of oil is concerned. This is one of the most competitive markets in the world, taking into account both the quantity of world production and the geographical location of our fields in relation to markets in Canada and the United States. I am a lot more confident about the export market for natural gas than I am about oil, because I do not think it will be subject to the same vicissitudes, and I would like an assurance from the minister that a very close watch is being kept on this.
Each time there was a suggestion in the United States press that quotas might be imposed on oil, those now on the ministerial benches used to rise in their places and try to badger the minister's predecessor with respect to the efficacy of the national oil policy. The performance of that policy over the last four years is ample proof it was a wise one. The government of the day followed the wise counsel of the national energy board, and I would like to pay-


Lucien Lamoureux: I regret I have to interrupt the hon. member but his time has expired, unless he is given leave by the committee to go beyond his allotted time. Is that agreed?


Some hon. Members:: Agreed.


Norman Platt Lambert: I appreciate the courtesy of the committee in allowing me a few more minutes so that I may complete my remarks at this stage. Again with regard to oil and gas, may I point out that almost 72 per cent of our national production is produced in Alberta, 21 per cent in Saskatchewan and almost 5 per cent in B.C. We have a tremendous market for this product and there are pressures to sell more. We have approximately 15,000 producing wells which at present are producing at something like 55 per cent of their economic potential, and we also have the beginning of the development of the Athabasca tar sands in northeastern Alberta. These sands are just on the eve of massive development. Within three or four years we shall be seeing enough oil coming down the pipe line from the tar sands to keep one rather large refinery going, and this is only a mere beginning.
I have seen figures which show that the reserves of oil in the oil sands, sufficient for our requirements both in the export and

Private Bills
domestic market, will last 1,040- years, which gives an indication of the vast potential of the area.
I would like to hear the minister comment on the national economic council, which was introduced with a great fanfare in 1963. There was almost indecent haste to replace the national productivity council with it, and I would remind the committee that the national productivity council was doing good work. Its name was changed to the national economic council and the government replaced its membership to a large degree. Since then there has been a great silence from the council so far as real, hard results are concerned. Listening to the devotees of economic planning who now occupy the government benches, we thought we were going to get the formula for the economic development and salvation of the country, but this seems to be the best kept secret of the year because we have heard nothing of any consequence from the national economic council. At least the government has kept very close counsel in this regard.
It is now five o'clock, Mr. Chairman, and I shall conclude my remarks for today, but will continue them on another occasion.


Lucien Lamoureux: Do hon. members of the committee wish me to call it five o'clock?


Some hon. Members:: Five o'clock.


Lucien Lamoureux: It being five o'clock I do now leave the chair so that the house may proceed to the consideration of private members' business as listed on today's order paper, namely notices of motions (papers), private bills and public bills.



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[Stage Direction]
The house resumed from Thursday, September 10, consideration in committee of Bill No. S-27, respecting the Bell Telephone Company of Canada-Mr. Brown-Mr. Lamoureux in the chair.
On clause 1-Number of directors.
Mr. Brown:: Mr. Chairman, I have grave doubts that the amendment before the committee is in order. The bill asks parliament to enlarge the permissible number of directors of the Bell Telephone Company of Canada from 15 to 20. The amendment asks that three directors out of the 20 be appointed by the governor in council, and this is an innovation that goes far beyond the limits of the original act that incorporated the Bell Tele-

phone Company of Canada and is, I submit, far removed from the scope of an amendment.
I would suggest to the hon. member who moved this amendment, which is so far reaching, that he withdraw it. An amendment of this type should not be brought before parliament except after careful thought, and at an appropriate time. It has been hastily drawn to meet this occasion and could have the opposite consequences to those intended. It would I think be chaotic if members of parliament, or retired members of parliament, or those deserving the favour of the governor in council were to be appointed directors of the Bell Telephone Company of Canada. The governor in council is not a body to appoint directors of a company whose shares are owned wholly by its shareholders.
The mover has, I know, good intentions in his amendment; but I doubt that he or his supporters seriously expect the Canadian parliament to pass it. Its passage would undoubtedly lead to the greatest confusion and to ultimate chaos, turning or prolonging directors' meetings into a fruitless waste of time. Every group asking to be granted a charter might be asked later on, if their company had signal success, to provide for the appointment of directors by the governor in council.
In addition-and I need scarcely mention this-this is an infringement of property rights and the liberty of the subject. It is far different from nationalization, and subsequent compensation to owners and shareholders. It is an invasion of that field of legislation reserved to the exclusive jurisdiction of the provinces under our constitution. It permits a wholly unwarranted intervention or intrusion by the governor in council into the private affairs of Her Majesty's subjects.
It is particularly significant that this innovation will affect the Bell Telephone Company of Canada, that most Canadian of all companies and a company which operates one of the most efficient telephonic communications systems in the world. The supporters of the amendment have stated that this type of interference by parliament is common in many countries of western Europe. I believe that France was mentioned as a country where some directors were appointed by the government and where the telephone system is partially owned by the state. I would ask any hon. member whenever he goes to France to endeavour to place a long distance telephone call in that country, a country where



X. 1964

[Stage Direction]
the government appoints a percentage of the directors. I would refer hon. members to the issue of Le Figaro Litteraire for the week of August 27 to September 2, 1964, and to read therein the article by Monsieur Francois Nourricier. It took him more than 27 hours to make an urgent telephone call into Paris from a distance of 50 miles away. Merely reading the story would be a salutary experience for many of us. Do the Canadian people want to risk losing the efficient telephonic communications system that it enjoys at the present time in order to experiment with the fanciful provisions of this amendment? I say not, Mr. Chairman; although I want to add that I respect the mover of this amendment and many of the other speakers.
I would remind hon. members that very shortly the Board of Transport Commissioners for Canada is to review the financial affairs of the Bell Telephone Company of Canada. This is the body that represents the Canadian public in its dealings with the Bell Telephone Company of Canada. Will its functions be aided one iota by a few directors being appointed by the governor in council as a political plum, or honour, if you like, to defeated candidates or even to members of parliament? I would think not. Mr. Chairman, the amendment is unrealistic; it is eccentric and ill-conceived, and will never meet its intended purpose. If it is not wholly out of order, it ought certainly to be defeated in committee.
Barry Mather: Mr. Chairman, I would like to say a few words on this subject. I speak in favour of the amendment which would add public directors to the board of the Bell Telephone Company, and I speak against the original proposal which would add private members to that board. I think it is very timely that we consider that only two weeks ago, as the previous speaker mentioned, the board of transport commissioners virtually called the Bell Telephone Company on the carpet so that it could examine its operations. I think this would be a most untimely period for us to extend the private control of that organization, at least until the board has, as it has announced it will, reviewed the operations of the company.
I need only quote from the statement issued by the board so recently on this subject to explain why many hon. members in different parts of the house are opposed to the extension of the Bell Telephone Company private directors board. I quote from the board's statement:
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The periodic studies made by the board's staff and the information supplied by the companies from time to time showed that there had been certain changes in capital investment, revenues, expenses, debt charges, dividend payments and retained earnings of the companies.
This refers to the Bell Telephone Company and to the B.C. Telephone Company. The statement continues:
It would appear to be in the public interest that the board should hold a review by way of public hearings to consider the capital investment, revenues and expenses, debt charges, dividend payments and retained earnings of the company and the permissive level of the company's earnings and the basis on which such permissive level may be authorized for telephone rate purposes.
The board does not intend to inquire into the propriety of existing rates or any revision thereof that may be requested in consequence of the board's finding which will be reviewed later if necessary.
The other telephone company mentioned in the board's statement is the British Columbia Telephone Company, whose profits have risen by more than 100 per cent since 1958. In the case of the Bell Telephone Company, which would add to its directors under the original motion, the total dividends paid increased about 75 per cent in the seven-year period from 1957 to 1964, or from $35.4 million in 1957 to an estimated $61.4 million this year. In other words, the Bell Telephone Company is making over $1 million a week from supplying privately a service that should be, surely, publicly conducted for use and not expressly for profit. This is the basic reason why we in this party feel that if any addition is made to the board of directors of the Bell Telephone Company, it should be done by the appointment of public directors, especially at this time.


Lucien Lamoureux: Before I recognize the hon. member for Timiskaming I might mention that when the hon. member for Brantford spoke a short while ago he raised a point of order which I had a chance to consider quickly while the hon. member for New Westminster had the floor. Certainly I feel the same way as the hon. member for Brantford, namely that there is some doubt as to the legality of this amendment, which is unique perhaps in some ways. On the other hand, there has been discussion and debate on it and I believe it would be most unfair to hon. members who wish to take part in the debate if I were to rule on the point of order now. I suggest we continue the debate on the amendment now before the committee.


Mr. Peters:: Thank you, Mr. Chairman. The remarks of the mover can be concurred in as far as I am concerned because I think

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this amendment may have been hasty, and is unique. We in Canada are facing problems which should have been discussed years ago. I agree with the hon. member when he says that the Bell Telephone Company of Canada, which serves 400,000 subscribers in Ontario and Quebec, is a worth-while, highly modernized and efficient operation; there is no question about that. We in Canada are very proud of our telephonic communications systems. It is true that in Europe and even in France the situation is such that it would be easier to walk and speak to your party than use the telephone, but I certainly did not say or intend to imply that the telephone communications system in France is operated by government appointed directors, because I do not know whether it is or is not. I do know that many enterprises in France are in that circumstance, but I would not presume to say that their telephone system was.
The board of transport commissioners have, in my opinion, listened to some very odd arguments from the Bell Telephone Company in the past and it is interesting to note they have now decided to review the rates to the subscribers in the province of Ontario and the province of Quebec. The board of transport commissioners should have looked at these rates a long time ago.
A chap came into my office the other day who had been doing considerable work in the field of government investment, and it seems governments have involved themselves in communications systems to a large extent. In a country as large as Canada, interlinked as it is with the United States defence system, it is normal that a large system of communications which is absolutely necessary to any type of defence of our nation would be inter-related with other existing communication systems. In most countries I am sure there is a division between private systems in operation, even the monopoly civilian systems, and national defence operations. Because the Bell Telephone Company respect the government and receive co-operation from the board of transport commissioners, they have been an efficient organization, able to supply services required and are able to provide a large amount of money. They are also in a position to take advantage of Canadian and United States defence contracts.
We do not own our own system or even the trans-Canada telephone system, which itself is a pooling of hundreds of telephone systems throughout the country. In 1962 these contracts to which I have referred-I am talk-
ing here of the public tender contracts, not the type given to the Bell which are of a classified nature-amounted to approximately $6,385,000, and in 1963 to $6,869,000 approximately. For the month of August of this year they amounted to $13,277,000 approximately. So that in the first six months of this year they were more than double of the two previous years. That is a factor which must be taken into consideration.
Great emphasis is placed on the fact that this company is a Canadian company, but I do not think it really exists as a company except in the minds of the shareholders. This company is the American telegraph and telephonic system, I am sure. On paper it may be Canadian owned, but there is the same kind of subsidiary in the United States, Western Electric, and in the north there is Northern Electric, a totally owned subsidiary which manufactures parts.
The province of Quebec is interested in doing something about this question. I saw an official the other day who was talking to me about the legality of the action of the Quebec government in taking over the Bell Telephone Company in that province. It is my opinion that if the Quebec government wants to take over Bell's assets in the province of Quebec, they can be expropriated, provided they do not interfere with the federal charter which allows the company to operate on a national basis and is a link between the government, through the board of transport commissioners, and the public.
I think the Liberals had better look at this matter and not hide their heads in the sand. Somebody has to do something about Bell because the rates are far too high. They are almost double what they are in the three prairie provinces which have, in the main, a rural operation. The operation in Ontario and Quebec is mainly an urban one, and in the northern areas of those two provinces other telephone companies operate, similar to those in western Canada. I think the Liberals had better think twice before they reject this amendment. I think the directors of the Bell Telephone at the present time will be happy to accept this kind of control and direction and allow the government to have some small say in its operation, rather than allow the government of the province of Quebec to take over their assets any time they wish to do so by means of expropriation. Many people have said to me: "Let us expropriate the whole of the Bell Telephone". Let us go further and expropriate all the telephone communications systems in Canada, because they are pretty

vicious monopolies. It is impossible to conduct a conversation with a neighbour in a town, to operate a business in a community or to conduct any ordinary type of business without using the monopoly of the telephone company in any given area. In return for that there is some small measure of control by the board of transport commissioners. The board was not set up to look into telephone communications; they were set up to decide the tariffs of railways. They were not meant to decide whether the subscribers rate in Ottawa is $6.50 or $4.25 in northern Ontario, or $3.90 in the prairie provinces. That is not their function, and having talked to some of these officials I know they are not equipped to handle this problem. The public demands some control, and control along the lines suggested in British Columbia. Perhaps a federal charter should not apply and these companies should be forced to obtain provincial charters. If that were the situation I am sure that British Columbia would, by majority decision, expropriate and nationalize the provincial telephone system. I think that will happen in the province of Quebec earlier than the people concerned with this matter think. There is a great deal of interest in the province of Quebec in this possibility, and I can foresee a move being made towards the expropriation of the telephone systems in that province within the next two or three years.
Mr. Chairman, I want to be entirely fair in this matter and must say that it is not only the Bell Telephone Company that creates difficulty for the province of Quebec. I understand there are more than 150 telephone companies operating at the present time in the province of Quebec. Many of them operate very archaic exchanges, and rural systems badly in need of modernization. I suggest that will only be accomplished as the result of the Bell system being expanded in that province. I do not think a provincial system could accomplish this improvement unless it took over the large urban subscriptions, which would of course have an effect on the Bell Telephone Company.
The Bell Telephone Company vice president came to us several weeks ago in Ottawa and said in respect of this increased board of directors that one of the directors to be appointed would probably be a representative from a university. He said one of the directors would be a man now high in the academic field completely divorced from politics and business, but interested in providing the board of directors with some academic experience. He suggested that another appoint-
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ment might be made from the industrial sector of the country and this appointee would provide information in respect of industrial aspirations in this field of communications.
Mr. Chairman, I had not heard a government member stand up and say, that if three appointments were to be made by the governor in council, they would be defeated political candidates, until the hon. member made that suggestion today. I had not heard a government member before say that these appointments would be political plums handed out on a patronage basis. I take off my hat to that government member. He has been much more honest and courageous than most members in discussing this very touchy and unique part of our political way of life. He says these appointees will be that type of individual.
Mr. Chairman, I do not believe the hon. member is correct in that suggestion. I do not contemplate such a development. I believe the individuals appointed in this way would be of the calibre and type the government has appointed during the last several years to sit on royal commissions. I think they would be exactly of the type suggested by the vice president of the Bell Telephone Company. One might well be appointed from the economic department of one of our universities. Another appointee might well be an outstanding banker from the Canadian banking association. Perhaps some man off the street would be appointed to represent the consumer. Such an individual could perhaps act as an ombudsman on behalf of the ordinary consumer. I am sure such a man would have experienced a disconnection of his service because he did not pay his bill during a time when he was away on holidays. Every member of this committee I am sure has experienced that situation. The telephone system of today has become so automated the companies really have little or no contact with the average subscriber. Perhaps we need an ombudsman in this field.
The government could appoint outstanding people, as both this government and the former government have done in the past. I am very proud of the fact that our governments in the past have seen fit to appoint men of high calibre to royal commissions and other like bodies. The majority of such appointments have not been made on a political basis, and the men appointed have not been unemployed politicians. The contribution which could be made by three outstanding members on the board of directors of the Bell Telephone Company could per-

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haps stave off the nationalization oi the system. While that may not be the normal way of accomplishing this, I think if it were successful it would be an excellent thing.
I am shocked that most government members are opposed to the type of innovation suggested by the amendment. I think it embodies something that should be attempted. If the sponsor of the bill was instructed to oppose this amendment, then I can only believe he was not fully aware of the situation at the outset. Three new directors, to be appointed by the government are required by this company. Unless we receive a satisfactory reception to this suggestion I think we are better off to kill the bill and let the present board struggle on as it has done in the past.
A young university lad, who is very interested in this matter, asked me why the company needed more directors. I was unable to give him an answer because I honestly do not know. If the A.T.T.C. took over the Bell Telephone Company tomorrow-I am not sure it did not take over that company some years ago-I am sure it would demand representation on the board. The latest telephone system taken over by Bell Telephone Company was a small exchange in Newfoundland, and I am sure that company was not important enough in terms of subscribers, in relation to the systems in the provinces of Ontario and Quebec, to warrant the addition of five new directors to the board. I do not think the situation which developed in Kenora in recent days has had the effect of making five additional directors necessary. I have very seldom, if ever, heard of an increase in a board of directors that did not accompany a change in the financial control of the company.
How much is paid to the board of directors? I am sure it does not exceed $50,000. I do not think this company would have any difficulty in paying that extra amount. I understand that something in the neighbourhood of $13 million to $20 million is spent in communications in the field of national defence. That being so, the telephone company does not need individual subscribers. The company is able to profit from communications in respect of restricted fields such as NORAD and the radar systems. This company also provides services in respect of computer operations, telex and other teletype communications systems.
The sponsor of this bill should reconsider his position and his instructions from this company, in refusing to allow the bill to

pass containing the proviso that three of the five members of the board of directors be appointed by the governor in council. This company is desperate. I am sure the sponsor is aware of that fact as I am sure the board of directors is aware of it. It is desperately in need of closer communication with its subscribers. Do you know what the vice president told us, Mr. Chairman? He said: The complaints you make are being investigated and the president of the company has insisted that every complaint come to his attention. Think about that, Mr. Chairman. What is the poor president doing these days other than answering his fan mail from his subscribers? This is not the kind of thing he should be doing. He has a multimillion dollar enterprise to operate and he cannot be listening to the beefs of the subscribers.
The three people who would be appointed as ombudsmen on behalf of the Canadian people could listen to these complaints and I would surmise they would need a very large staff to deal with complaints because you cannot find out anything from the local manager. He really does not know anything. The billing system is based in Montreal. He has no power to make a decision. He does not know what has happened because the computer has not told him. Most of these computers are short on words and long on action. The action is taken long before an explanation can be given and to put a tracer through the computer probably is a very tedious and sterile process when the results are finally returned. When they arrive on the manager's desk I imagine he faces a very confused situation.
If the Liberal government is sincere in saying as they have said in the past that all they want to do is to provide the things the N.D.P. wants to provide but to do so in a more calculated and studious manner after a great deal of thought, they will find that the appointment of ombudsmen to companies that come to parliament for their authorization so that these ombudsmen may make suggestions on behalf of the people of Canada and supervise operations will be a highly acceptable, although novel, method of counteracting the nationalization that will take place in this field if the government fails to act soon. I think that many Quebec members can stand up and say that the taking over of the Quebec section of the Bell Telephone Company has been widely desired in the province of Quebec and is currently under active study by the government of that province. All you have to do is to look at your telephone bill to know why they have been very concerned

about this matter. If the government wants to protect the Bell Telephone Company the action of appointing ombudsmen may provide a safety valve for the subscribers that will be very effective.
In my opinion the governor in council will appoint reasonable, responsible and impartial people to the board of directors to act on behalf of the government of Canada and particularly on behalf of the governor in council and the general public in supervising the operations of the Bell Telephone Company. We must always bear in mind, Mr. Chairman, that this is a national monopoly. We have granted this monopoly to the Bell Telephone Company in a field where even the defence of our nation is involved and one failure might result in a disaster. Let me use an example because we must not be vague about this matter. I had the opportunity-


Lucien Lamoureux: Order. I am sorry to interrupt the hon. member but his time has expired.


Mr. Walker:: May I ask the hon. member a question?


Lucien Lamoureux: With the consent of the committee, because the hon. member's time has expired. Is it agreed?


Some hon. Members:: Agreed.


David James Walker: Is the hon. member suggesting that the government should also have the authority to appoint directors to the other hundreds, as the hon. member stated, of telephone companies in the country?


William Arnold Peters: Mr. Chairman, I would be out of order if I went very far in discussing other telephone and communication companies. This question is very pertinent to the whole argument and the vice president of the company asked me if we were prepared to do this to other companies. I have checked the situation and it would appear that the only time we can take such action is when a company comes before parliament asking for further authorization. If such action were successful in this case I believe that the government would take similar action in the case of all federal companies. We can only do so now in the case of the Bell Telephone Company which has a bill before us, but if this method proves to be satisfactory I see the government asking authorization from parliament to impose the same statutory provision with respect to other companies.


Mr. Fairweather:: Mr. Chairman, I do not agree with the method proposed this after-20220-547
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noon by the hon. member for Timiskaming but I do agree with the objective, and I think that in one of my longer speeches I should say so. I believe this matter could be settled with dispatch if the company would show good, modern social sense and ask the government to nominate three of the 20 directors. They were referred to as ombudsmen but in my view that is not a good term. They could be friends of the public on the board of directors of a company which enjoys a virtual monopoly. I think this would be the better approach.
I am surprised that a great company like Bell has not long since asked the government to nominate three of the 20 directors. This is not a very revolutionary proposal and if Bell would do this it seems to me that this bill would receive more rapid passage through parliament than it is getting. With regard to the last question, I think that any provincially incorporated company, if it has a monopoly, should accept representatives of the government on its board of directors. This is not an unusual thought. Some of these companies are controlled to some extent by public utility boards but it seems to me that there should also be nominees of either provincial or federal governments sitting on their boards as friends of the public. If Bell had displayed a sense of responsibility they would have asked for this and not left it to a committee to make them do it. If they ask for it I have an idea the bill will go through.


Gérard Laprise: Mr. Chairman, I did not intend to speak on this Bill No. S-27 which has already been discussed for several weeks.
The purpose of Bill No. S-27 is to allow the Bell Telephone Company of Canada to increase to 20, from 15, the number of directors which they already have or which they are entitled to appoint. This bill was referred to a committee of the house. It came back and we are now discussing an amendment submitted by the hon. member for Timiskaming (Mr. Peters).
Mr. Chairman, I believe that the Bell Telephone Company gives good service wherever it is in operation, and I am wondering how the services it gives could be improved by increasing the number of its directors. I truly believe that it could improve its services on all its lines throughout Canada, and I know that it is already attempting to improve them. So, I wonder why vague answers are given to questions asked in the committee, or no answers at all are made, when it is wished to increase the number of directors.

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Mr. Chairman, before taking a stand on the amendment now before us there is a point I should like to clear up. On several occasions I asked for the report in French of the committee which considered this bill and once again this afternoon, I was told that there was no French version. On the other hand, for several weeks, the English version has been seen going around, but the French text of this committee report is not available.
Mr. Chairman, I am hard put to study the bill itself or the answers made to the questions. If that report is not presented to us in French, I shall have to move an amendment or a motion to postpone the discussion of the bill until we have the French material we need.
Mr. Chairman, on the amendment before us tonight which was introduced, I think, on September 10, I do not agree with the hon. member for Timiskaming that three of those directors should be appointed by the government.
This amendment is as follows:
The business of the company shall be managed by a board of not less than five nor more than 20 directors, as may from time to time be determined by resolution of the shareholders, and each such director shall be the proprietor of at least ten shares in the capital stock of the company, or such other additional number of shares, not exceeding 40 additional shares, as the shareholders shall by any resolution passed at any annual general meeting, or special general meeting, from time to time determine: and the said board of directors shall be elected and hold office as hereinafter provided; and a majority of the said directors shall be residents of Canada.
Mr. Chairman, in this Bill No. S-27 amendment we have a dose of socialism, a small dose, if you wish, but a dose just the same. I think the government has available legislation giving it power to investigate any Canadian company. There is the Combines Investigation Act enabling the government to take a look at the operations of those companies.
I must admit, however, Mr. Chairman, that this act or these investigations into combines are not too efficient, because they are not always given the priority they should have. The considerable increase in the price of sugar that followed the last general election has not yet been forgotten. We asked for an investigation into combines and we were told that one was under way, that it would take a very long time before we would get its report.
If an effort were made, these inquiries into combines could enlighten us as to the actual situation and we would know whether the company or any other company in

Canada is providing reasonably good service to the Canadian public without obliging them to pay prices that are far too high.
That is why, Mr. Chairman, I am opposed to the amendment as it would enable the government to interfere directly in the company's business or in Canadian institutions.
Mr. Chairman, when the amendment is put to a vote, I shall have to vote against it for the reasons I have just outlined.
I will say no more about this because the debate is now on the amendment only. However, when we come to the various sections of the bill, I shall say what I think of Bill No. S-27.


Mr. Plourde:: Mr. Chairman, I did not intend to participate in the debate, but in view of the various questions raised I want to mention that the discussion which has taken place with respect to Bill No. S-27 proves once more that when private industry -which we favour-becomes a monopoly or a trust, the government must take steps and assert itself.
The amendment now before us concerns the appointment of directors by the government. I am against this proposal for the same reasons my colleague from Chapleau (Mr. Laprise) mentioned a moment ago, since we favour private enterprise.
In my opinion, the Bell Telephone Company operates somewhat like a monopoly. Its rates are too high, especially if compared with those in other provinces.
For instance, in Quebec the monthly rate is $6.46, when the same service is available in Alberta for $3.50. As you can see the Bell Telephone Company really goes too far.
If we had the French version of the proceedings of the committee which considered Bill No. S-27, we would be in a better position to discuss it.
Once more I mention the fact that it is intended to appoint more directors, to whom very high fees will be paid which might entail increased rates.
Mr. Chairman, for all the reasons I mentioned I will vote against the amendment.


Lucien Lamoureux: Is the committee ready for question?


Colin Cameron: I was interested in the statement by the hon. member for Brantford with regard to the French telephone system. I do not recall anyone mentioning the French telephone system. I think if he were to look at the situation in the whole of Europe, he

would find it had very little to do with public or private ownership. It has to do with the lack of subscribers to those systems. It is only in North America that you have these tremendous networks of telephone systems where virtually everyone has a telephone.
Like my colleague from Timiskaming, I was interested in the political plum aspect of the hon. member's discourse, and the rather cynical regard he has for his own government if he assumes they would appoint directors from the ranks of those who usually receive political plums. But, Mr. Chairman, as has been mentioned here, the company has never told us why they want five more directors. I was unable to get this information from the vice president in the course of a long conversation with him. All I got, to be rude about it, was windy nonsense about how they wanted to broaden the base of their directorate; they wanted to bring in people from the various walks of life, the academic and business world. It struck me as rather unconvincing and I am still unable to understand why they come before us for this purpose at this time.
For the life of me I cannot see that the addition of five members is going to make all that difference to them. On the other hand, the proposal made by my colleague, the hon. member for Timiskaming, that three of these should be appointed by the governor general in council, in the light of speeches a few moments ago, appears to have been received as the first sign of creeping socialism that is going to overwhelm the company.
I said when I spoke first, Mr. Chairman, that my, shall I say, more logical mind would have preferred to see an outright move for the nationalization of this company. I make no bones about that at all. It would appear to me to be the only logical course sensible people would follow, but I am well aware that we are not going to get that at the present time. In the meantime we need some measure of control and observation on behalf of the people of Canada.
I suppose the telephone business, more than any other type of business, is one that has been built up by its subscribers. It is a very different business from most large corporations producing goods, or even services. A telephone company is built-and the history of all our telephone companies is proof of this-by the contributions of its subscribers. The origins of most of the telephone companies in North America were extremely modest, with a very modest amount of capital originally invested and the assets of the 20220-5474
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company built up by the contributions of the subscribers-who are actually a captive group, because we cannot take our trade somewhere else if we do not like the telephone company. We have them or we have nothing.
For that reason it seems to me the telephone company is in a peculiar and singular position. It is a necessity for the operation of the modern industrial society. We just could not function without it, and that in itself appears to me to be one overriding reason why the public interest should be protected by the appointment of-and I have more confidence in this government than the hon. member for Brantford-the appointment of responsible people who would undertake their duties seriously, who would realize just why they have been placed in this position and would not consider it merely a plum for a defeated candidate or a reward for party service. Like the hon. member for Timiskaming I think that is a slur on this and previous governments because, while there have been such people appointed, there have also been some very useful appointments of this type.
I notice that there is great concern on the part of some members about the position of shareholders and the rights of shareholders in a telephone company, that they alone should have the right to appoint directors. No one seems to consider the rights of the subscribers or the rights of society as a whole, organized as it is today on a very complex basis and requiring the services of a telephone company in order to operate at all.
My hon. friend from Brantford was citing the horrors of the system in France. I do not know whether the telephone system there is publicly owned or not; I suspect it is but I am not sure. However, right in this country there are publicly owned telephone systems whose operations are in striking contrast to that of this multimillion dollar corporation, the Bell Telephone Company of Canada. In all the prairie provinces we have publicly owned telephone companies which operate in much more difficult and expensive areas as regards telephone service than does the Bell company, and in those provinces you will find just as good service as you get from Bell, and the price is less.
I see the hon. member over there shake his head, but I can tell him I have observed when I have taken up a phone in a city like Regina or Saskatoon that I get through just as quickly as I do when I pick up the phone in Ottawa. I have also observed something else, that when I have to use a pay phone in

Private Bills
the province of Saskatchewan I have to deposit only a nickel in the slot, not a dime. If the hon. member is looking for comparisons between public and private enterprise in this field he should perhaps take that particular situation into consideration.
Seriously, Mr. Chairman, I think it is time that the parliament of Canada recognized the developments in the world today, and realized it is ridiculous to continue regarding a telephone company of the dimensions of the Bell company in the same light as we regard other corporate bodies in this country. There are many that should be regarded in the same light. In fact I recall when I was having this interview with the vice president of the Bell company he was very plaintive and he asked, "Why do you pick on us? Why are we the ones who are to be penalized in this manner?"
It was interesting to note he seemed to think that the presence of publicly appointed directors on the board of directors would be a penalty, and that the company would be penalized by that. I assured him I was not anxious to discriminate in any way, that I would be only too glad to propose the same or even more drastic proposals for other corporations in the country, but it was his company's misforture that they had been the first to pop their heads up and enable us to do a little bit of hair cutting on top of their heads. I assured him when others came up I would be there with my shears to do the same with them.


An hon. Member:: You have got the hon. member for Edmonton West worried.


Colin Cameron: He has already been sheared. Seriously, Mr. Chairman, I would like to impress on Liberal members of the house who make claims, most of them I think quite sincerely and honestly, that their party is trying to keep abreast of developments in the modern world, that it is a flexible, pragmatic party that takes into account recent developments. This is one of the developments of recent years of which the party should be cognizant and taking action about, namely the development in our society of a privately owned organization which grew from very small beginnings and which now embraces not only this particular company but almost the bulk of the population of Canada in the services it renders.
For that reason I suggest the time is long past when this government, if it is going to do more than pay lip service to its claims,

should be prepared to move into this field in the very modest way we are suggesting. If it had any courage I would suggest it move in much more drastically, but I am not going to suggest more than I think it is capable of doing. I believe members of the Liberal party should screw up their courage to take this minor step toward eventual public control of something which is essential to our society, something which should not be left without public control.
Mr. Chairman, may I call it six o'clock.


David James Walker: You are talking out your own amendment.
Progress reported.


Mr. Deputy Speaker:: The hour for the consideration of private members' business has now expired.



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Deputy Speaker:: Pursuant to provisional standing order 3 9A, it is my duty to inform the house that the following questions will be raised at ten o'clock this evening: the hon. member for Danforth (Mr. Scott) automobile parts; the hon. member for Burnaby-Coquitlam (Mr. Douglas), national defence, La Macaza, Quebec.

The hon. member for Dorchester (Mr. Boutin), grants to Quebec cultural centres. [Text]
The house will now resume the business which was interrupted at five o'clock.

The house in committee of supply-Mr. Lamoureux in the chair.
DEPARTMENT OF TRADE AND COMMERCE General administration-
1. Departmental administration including fees for membership in the international organizations listed in the details of the estimates, $5,180,500.
At six o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 8 p.m.
The Deputy Chairman:: Order. House again in committee of supply; estimates of the Department of Trade and Commerce for the fiscal

year ending March 31, 1965. Vote No. 1. Shall vote No. 1 carry?


Mr. Pritlie:: Mr. Chairman, my colleague the hon. member tor Danforth usually speaks for this party on trade matters, but he had a conflict of interest today; he is a member of the flag committee, and I hesitate to say which is the more important task. I shall comment briefly on trade policy and pose some questions to the minister; other members of the party will speak on particular votes of the department.
The hon. member for Edmonton West this afternoon said he would have liked a copy of the minister's statement before the minister read it in the house, so that he might be better prepared to speak on the estimates of the department. I would go a little further than that; I feel that a great deal of information is lacking to opposition members generally when they wish to speak on estimates. We have heard a great deal lately about the need for research assistance for members of parliament, and I think this is shown up very much at a time like this. The only resources we have are our own, and they are limited in some cases. But from reading the departments' reports and keeping files we can amass a certain amount of information on the departments in which we are interested. However, Mr. Chairman, I think the education of M.P.s should go further than that.
Quite a number of years ago I had a short and unsuccessful career in the Department of External Affairs, but there is one thing I do remember from it. When we came to Ottawa as a new group of officers, they did make some effort to educate us. The people from various branches of the government, treasury board, the Department of Trade and Commerce and the Department of National Health and Welfare were brought in to give us lectures. I think we were better people and had a better understanding of the government as a result. No efforts are made in this connection with new members of parliament. I suggest this could be done.
I was reminded of that this afternoon when we received notice that the members of the railway committee and other members interested could meet next week for a meeting on the new railway bill which is coming before the house. I think we could stand a briefing on the operations of a great many departments and we could do our job much better as a result.
Now, Mr. Chairman, I wish to make some comments on trade policy. I understand that setting trade policy for a country like Canada
Supply-Trade and Commerce is difficult at any time. There is only about one thing on which Canadians generally agree with regard to trade policy; that exports are good and we should have more of them. Aside from that there is very little agreement. We have our producers of primary products who are in favour of exports and low tariffs. We have the manufacturers of this country who by and large are tariff protected; they are not too interested in exports-at least, they have not been until quite recently. Also they are not interested in imports at all. In addition to that we have our regional differences. Some parts of the country are much more interested in exports than others, some are interested in low tariffs and others want tariffs to be maintained.
There are very great regional differences, and I think as a general rule the western and Atlantic provinces are export conscious whereas the central provinces are protectionist conscious. These differences which exist in the Canadian business world are reflected, I think, within every party in this house. At the best of times I think it is very difficult to establish a trade policy which satisfies everyone in the country; but at the present time I believe this is particularly difficult because there are so many uncertainties. The whole question of the United Kingdom and its entry into the European common market is uncertain; the election in the United Kingdom might make some difference to the possible outcome of those negotiations, if they resume. The whole question of the Kennedy round within GATT is uncertain. I suggest that the outcome of the elections in the United States might make some difference to those discussions. The United Nations conference on trade and development was inconclusive and I believe will be resumed; but, again, it is hanging in mid air. Therefore, Mr. Chairman, with these uncertainties it is no wonder that no Canadian political party-and I will include my own-has a really coherent trade policy.
Now a word about the Kennedy round. As I understand it, at the present time the various countries are carrying on discussions with the trade groups within their countries to determine which particular items they would like to put forward for tariff reduction. I understand that the government of Canada is carrying on discussions with trade groups in this country at the present time and that they will meet later and sit down to some more bargaining. I think generally most of us want the Kennedy round to be successful. Certainly the Minister of Trade

Supply-Trade and Commerce and Commerce does, and he seems to be placing very great hopes upon these negotiations. If they are successful, I wonder whether the government and its policy-makers are working along the lines that I am going to suggest.
This party has advocated in the past that there should be some kind of trade adjustment act. Presumably If the Kennedy round negotiations are successful and we gain certain concessions in regard to trade with other countries, we will have to make concessions too; and undoubtedly this will affect our manufacturing industries. Some of them may feel hardship. I am wondering whether the policymakers within the government, in the Department of Trade and Commerce or any other department, are making plans for that particular day and have decided what is going to happen to the people who will be affected in the localities which may lose their tariff protection; what may happen to the workers in the industries that may be affected.
It seems to me we should be prepared for that day. If these discussions are successful, we should be prepared for the impact this will have upon Canadian industry. I should think central Canada would be particularly affected. I should like to mention one other point in connection with the Kennedy round: I think they all hope it will be successful, but has the Department of Trade and Commerce given any thought to the consequences if the talks are not successful. I know that the minister would probably prefer not to consider that possibility. However, it does exist. We must take into account for example such questions as the entry into the European common market of Canadian and United States agricultural products. We know there is great resistance in Europe to making concessions in this field. So far as I can determine from my reading, the president of France does not wish the Kennedy round any great success. It seems to me that if he could successfully prevent the type of result the late President Kennedy desired to obtain he would do so, as he prevented British entry into the European common market. It is likely that some of the problems facing the conference will be political as well as economic. As far as that goes, the success of the Kennedy round may be determined by which country has the greatest influence with West Germany-the United States or France. Failure is a possibility for which the minister's planners should be prepared. Are the minister's advisers ready with plans for a Canadian

trade policy if the Kennedy round is not successful? I see the minister nodding his head; perhaps he could say a word about this question later.
I wish to turn now to discuss the resumed conference on the economic development of underdeveloped nations. I was at the United Nations session in 1962 when this question was under discussion. I know the developed countries accepted this conference with great reluctance; it was practically forced on them by the vast majority of the underdeveloped countries represented at the United Nations. I believe the developed countries were overwhelmed by the demands made upon them at that time. I believe there was a feeling that the underdeveloped countries were most unreasonable in their demands. This may have been the case. However, the need is very great. I hope Canada will show considerable sympathy for these countries and do what it can to make the resumed conference a success. This question came to my mind the other day when my hon. friend from New Westminster asked the minister a question about coffee prices under the international coffee agreement. My hon. friend showed some alarm at the increase in coffee prices in Canada and the western world generally. In reply the minister had this to say as reported in Hansard at page 8289, September 22, 1964:
In answer specifically to the question as to whether Canada is satisfied with the operation of the agreement, I would say that this agreement can be improved; and it can be improved, I think, for the benefit of both consumers and producers. I would urge upon my hon. friend who asked this question that it is very much in the interests of all of us, including the consumers of Canada, that there should be reasonable prices for coffee, just as there should be reasonable prices for wheat.
I agree with the minister's sentiments in this regard. One of the problems which underdeveloped countries face is the great fluctuation to which the prices of the commodities they supply are subject. In past years they have often not had sufficient income to carry on the industrial and other types of development desirable. So it is in their interest that commodity prices should remain at a stable and reasonably high level. I cannot argue against that. The same considerations apply in the case of sugar, the price of which has been subject to severe fluctuation in recent years. I suggest to the minister that though there should be stability in the price of commodities supplied by underdeveloped countries the government should consider making some kind of subsidy so that prices do not rise too sharply and cause hardship

to consumers in Canada. I know this is a form of taxation; it is another form of external aid; but it is something which I think is fully justified. I suggest that if the underdeveloped countries generally were to have commodity agreements covering their products it would lead to the stabilization of prices and the elimination of one of the greatest difficulties they face. On the other hand, if the price were so high as to work hardship on Canadian consumers the government should consider providing some relief at home. The two interests could I am sure be balanced.
While we talk a great deal about expanding trade not only with underdeveloped countries but with developed countries which buy a great deal more from Canada than we do from them, there are many inconsistencies in our practices. Japan, though not an underdeveloped country, is a nation which certainly has an unfavourable balance of trade with Canada. Year after year we continue to ask Japan to limit the export of certain commodities to this country particularly in the textile field. Speeches are made by the Minister of Trade and Commerce and by his colleagues advocated more trade with these countries, while at the same time we are asking them to withhold exports to Canada. The question of textiles is an important one. Is any examination being conducted to find out what the future of the Canadian textile industry would be if there were general tariff cuts? There are presumably answers to these questions. If the tariff were cut by a certain amount, then a certain percentage of the industry in Canada would not survive. If the tariff were cut by a further amount, presumably the section which would not survive would be larger. It seems to me that such a study should be conducted because it does not appear reasonable to ask Japan to withhold exports to Canada at a time when that country is increasing her purchases from us. Not only is Japan increasing commodity purchases here but she is putting up a great deal of capital to develop mines so that the minerals she needs may be available to her. Certainly some group should be giving consideration to the impact of Japanese textiles on the textile industry in the future. I do not think there can continue to be too much protection. I think we shall have to accept more textiles from other countries. If it can be determined that there will be a serious effect on the textile industry, the kind of arrangement I mentioned earlier, a trade adjustment arrangement,
Supply-Trade and Commerce should be made so that those who would lose their jobs would be helped during the transition period.
I suspect that our influence at these trade conferences, GATT conferences and United Nations conferences, is not very great. When the European common market on the one hand, and United States on the other hand, are bargaining I think we have to do the best we can. I am not convinced that Canada has a great influence on the outcome of these negotiations.
I gather from the minister's statements that our trade policy is simply to sell as much as we can. I do not know whether this is a sufficient policy or not. I pose the question, and I wonder if there is very much relationship between the internal monetary and fiscal policies of the government and its external trade policy. It seems to me there are inconsistencies at times. Perhaps we have still to determine what our goals are within the country. Perhaps these will emerge through the work of the economic council of Canada. If we knew where the Canadian economy was going we might know better what we want to see in the external trade field. I pose that as a question, Mr. Chairman, because there seems to be no relationship between the two.
Within the context of the trade policy of "try to sell as much as you can",-and that is the only policy I can observe at the moment-I think during the past year the minister and his department have done a good job. They have apparently successfully continued the selling job initiated by a previous minister of trade and commerce. There seems to be a great deal of activity on the part of the trade commissioners branch in promoting the export of both raw materials and manufactured goods. This export has increased, and I presume it will continue to increase in the future. In looking at the estimates and the budgets for those branches connected with trade promotions I note they have been increased.
We are pleased to see that this government has carried on the policy of the previous government, that of selling to all countries regardless of their international policies, and I am sure there have not been too many complaints on the part of the Canadian public or members in this house regarding sales to China, Russia, Poland and Cuba. We have been selling to any country that wishes to buy our goods.
In connection with Cuba, and I know the trade there is not too large, I should like to

Supply-Trade and Commerce pose this question. Since that country has been cut off from United States markets in respect of a number of manufactured goods, is Canada doing everything it can to gain those markets? I notice that Cuba recently purchased a large number of motor buses from the United Kingdom and has also bought manufactured goods from West Germany. Could we in Canada have obtained any of that trade? The general policy of selling to all countries is a good one, but I think it is dictated by necessity. The trade figures for Canada last year were very good, but what would they have been had we not had fortuitous wheat sales to Russia and China?
The department has carried on a vigorous tourist campaign, and I should like to say a word about that and about the Canadian government travel bureau. I understand some efforts have been made to attract Europeans to Canada as tourists, and more recently to interest Japanese in coming here. I think these efforts are very commendable but I am sure the officials of this department realize that tourists from these countries will always represent a very small percentage of our total tourist trade, and that the greater part of our tourist income is derived from United States tourists.
In looking over the department's report, I note that the Canadian government travel bureau has offices in only four cities, New York, Chicago, San Francisco and Los Angeles. This is one field of operations that might well be extended. There should be offices in cities such as Seattle, Portland, Minneapolis, Milwaukee, Boston and many others. Perhaps the tourist bureau could have more than one officer in many of these cities, because the tourist potential is very great in that country of roughly 200 million people. I think the government must do a double job in this respect. It must attract United States tourists here and convince Canadians to take advantage of the tourist attractions in this country. We are losing the tourism balance in favour of the United States.
The final point with which I wish to deal is one the minister referred to this afternoon when he made reference to relations between the Department of Industry and the Department of Trade and Commerce. He indicated that in his view everything was just fine and that there were no problems. Some of us have the uneasy feeling that there may be a duplication of effort. For example I was checking over the commodity branches of the Department of Trade and Commerce and I noticed they have several divisions including a chemi-


cals division, an appliances division, an engineering and equipment division, various other products divisions, a metals division and textiles division.
In looking at information supplied by the Department of Industry I note there is a chemicals branch, a textiles branch and a wooden products branch. Among the tasks of these branches is the supply of market information to the related industries, and import and export analyses. There is a very strong feeling that the Department of Industry has grown very rapidly and that there is a duplication in that department of the efforts of the Department of Trade and Commerce. There are internal branches in both departments having the same name, and both departments supply import and export information.
The Department of Industry has now been in existence for over a year and perhaps there ought to be an independent analysis of its operations, particularly as they relate to the Department of Trade and Commerce, to make sure there is no duplication and that Parkinson's law is not operating within this new department. There is reason to believe that duplication exists between the two departments and I think this should be avoided if at all possible.
Mr. Chairman, I conclude my remarks by summarizing some of the questions I have posed, and in respect of which I should like to hear the minister comment. Has the government any trade policy other than that of, sell as many goods as we can; and what is the relationship between the internal monetary and fiscal policy of the government and its external trade policy? Is the government carrying out studies to relieve the impact upon certain Canadian manufacturing industries if the Kennedy round of discussions is successful, and are they developing policies which can be used in this country if the Kennedy round of discussion is unsuccessful? I realize that these are questions of some magnitude. However, the minister is very competent, has a large department under his responsibility, and I am sure we will receive some answers from him in this regard.


Horace Andrew (Bud) Olson: Mr. Chairman, I think the statement we heard from the Minister of Trade and Commerce this afternoon could properly be referred to as a bouquet of roses. He seems to think everything that has happened in Canada in so far as his department is concerned is good and that everything has been going along very nicely. He seems to think the

increases this year, as compared to those of last year, or in recent years, are satisfactory. He seems to think that they have been so acceptable there is cause for exuberance in respect of the whole Canadian economy.
At the outset I should like to state that the figures supplied by the dominion bureau of statistics, and received from other sources in this country, bear out to a great degree the extreme optimism obvious in the remarks of the minister. He has indicated that our future outlook in respect of wheat sales is excellent, although those sales may not reach the levels we have enjoyed during the past 12 months. He has indicated that there should be no difficulty in selling this year's crop. He has indicated that our export prospects in respect of lumber and iron ore are favourable, and have been carried on at a reasonably high level during the past few months. The minister has indicated there has been a substantial increase in the export of manufactured goods. We are pleased indeed to hear of these things.
When the minister referred to the matter of our balance of payments he did not say very much. I suspect one of the reasons in that regard is that in this area, in spite of the tremendous increases in certain commodities for export, we are experiencing an even more unfavourable trade balance in so far as our current account is concerned.
I am going to deal with this in a few minutes, Mr. Chairman. There are a number of other things I want to say. I certainly cannot cover the entire operations of the Department of Trade and Commerce but my colleague, the hon. member for Chicoutimi, will be dealing with some other aspects later.
The minister also spoke of new trade patterns that are developing in the world, and said that Canadians generally ought to recognize that we have to modernize our thinking with these things in mind. But he simply left it there. He did not say anything about where these trade patterns were developing, whether they have developed to the point where there is a continuity to them, and in what way they are changed from the old traditional patterns. I should like him to elaborate a little more on these patterns.
The minister also referred to the Department of Industry, its growth and responsibility and some of the things it is charged with doing. I think he also suggested that the Department of Industry is primarily concerned with Canada's internal trade, if I may use that term. I believe he also added that the Department of Industry is primarily con-20220-548
Supply-Trade and Commerce cerned with increasing Canada's productivity while his department is more directly concerned with finding markets for products. That would appear to delineate to some extent the responsibilities of the two departments.
The Department of Industry has been in existence for about a year and I have had occasion to make representations to the department on behalf of some of my constituents, and on behalf of some industries in the province of Alberta. I want to say to the Minister of Trade and Commerce that the response by way of action on the part of the Department of Industry as a result of these representations has been less than favourable. In fact, until and unless they begin to show that they are in fact able to do something to promote the expansion of the industrial establishment in Canada we believe that they are not serving any useful purpose at all.
May I say to the Minister of Trade and Commerce that it seems to me that one of the functions of the Department of Industry should be to help Canadian industry to compete with certain imported products, at least in so far as taxation is concerned. The Department of Industry ought to assume the responsibility of seeing that the Department of National Revenue gives at least equal consideration to our own industries in so far as taxes are concerned, as opposed to products being imported from abroad. Some cases have been brought to the attention of the Department of Industry and the Department of National Revenue where there is in fact a much more favourable tax structure for the imported products. I will communicate the names to the department if they would like them although I think they realize that what is involved is bentonite or mud production in Alberta which is very important to the oil industry.
In addition, we have at least one potato dehydrating plant in Alberta that has been shut down for months and months. Repeated appeals have been made to various departments of government, and I might say that the federal government is involved because it is their processing patent, and the fact is, that problems with one of their patents are causing the difficulty. In spite of repeated requests to the federal government they have not shouldered any responsibility in regard to getting this very important plant back into operation by doing something to get around the litigation that is causing it to remain shut.

Supply-Trade and Commerce
The Minister of Trade and Commerce suggested this afternoon that in the new tariff negotiations that are going on in Geneva and generally among many of the countries of the world Canada was going to be a tough but not reluctant bargainer. The minister has not indicated up to now whether or not any agreement has been reached between the participating countries in the GATT negotiations in so far as agricultural products are concerned. On May 11 a release was issued by the Department of Trade and Commerce in which the minister is reported as saying:
When detailed negotiations have already been initiated with respect to wheat and other grains, the general rules and procedures for agricultural negotiations have yet to be worked out.
If they have not yet reached the stage where they know the basis upon which they are going to try to negotiate trading arrangements with respect to agricultural products, I suggest to the Minister of Trade and Commerce that they have got a lot of work to do yet. We remember that only a few months ago France threatened to pull out of the European economic community unless some arrangement with regard to trade in agricultural products within Europe was reached. We also know that there have been repeated indications in press reports from the United States that the biggest problem in the Kennedy round of negotiations was what they were going to do with agricultural products. I think that Canada has got to pursue this matter. Certainly we need to reach some agreement soon and particularly to lay down the ground rules for how we are going to proceed.
There is another thing that disturbs us about Canada's attitude in relation to the GATT negotiations and that is the way we seem to act with respect to our trade with Japan. The minister says that it is going to have to be a case of give and take and that we could not accept the premise of 50 per cent across the board changes and so on. I agree with all that but in our reluctance so far as Japan is concerned we seem to carry it almost to the point of absurdity. In another press release on May 4 this year the minister had this to say:
As was the case for previous multilateral negotiations in the post-war period, the Kennedy round will be taking place within the framework and under the aegis of the GATT. The GATT is a comprehensive multilateral trade agreement embodying contractual rights and obligations and providing detailed rules and procedures for the conduct of commercial policy. The basic principles of the GATT may be summarized as follows:-


I am only going to read one of them.
(b) Prohibition against quantitative import restrictions except in carefully specified circumstances.
That sounds very good until you apply it to Canada's attitude toward Japanese imports. I believe that we are in fact acting in a wrong way toward Japan. We know that we have had a very favourable balance of trade with Japan over the years. We know that we have a large potential market there for more agricultural products, more iron ore, more timber, for almost all of the commodities that are produced in western Canada for export. But, Mr. Chairman, how can we expect to expand these markets unless we are going to buy something in return? Japan is just as correct in her contention that she must sell to Canada to pay for her imports as is the argument we use with the United States. So, I hope there is going to be a change of attitude on the part of the Canadian government in their dealings with Japan so we do not continue this so-called tough policy in so far as quotas and quantitative import restrictions are concerned.
There is one other very serious problem that I think the minister perhaps brushed over a little bit, if I may use that phrase. It is this matter of our balance of payments. When he was in Los Angeles on May 21 of this year, the minister had this to say:
In the past 12 months, Canada's current account deficit has diminished, thanks to increased commodity exports, to a level of about $500 million a year. But this improvement is partly due to a strengthened communist bloc demand for cereals which is unlikely to hold at recent levels; the basic heavy deficit remains. And what concerns us here, the major source of this deficit continues to be Canada's trade with the United States. For while Canada enjoys a current account surplus of some $640 million a year with the world outside North America, our current deficit with the United States runs to nearly $1.2 billion. About half of this deficit comprises net payments of interest and dividends for which no short term reduction is possible; and most of the remainder is a deficit in merchandise trade.
Well, Mr. Chairman, to get some of the exact figures I turned to the dominion bureau of statistics. As I said, I do not want to throw any cold water on the minister's optimism. In so far as our increased activity in international markets is concerned, the latest statistics we have available come from the dominion bureau of statistics and deal with the second quarter of this year. I will not read all these figures but during the period April to June, between the years 1963 and 1964, our current account had a net deficit increase of $175 million with the United

States. In other words it was $346 million for the second quarter of 1963 and up to $521 million for the second quarter of 1964. The problem is, Mr. Chairman, in spite of the minister's optimism, that if we took away the unusually large shipments of wheat and flour to the U.S.S.R., these figures would look alarming. There is no indication at this time there is going to be a repeat order of that magnitude or indeed of any amount from the U.S.S.R. If all of these other things had remained equal, and leaving out that particular order, these figures would be alarming indeed.
So far as we are concerned, Mr. Chairman, we believe that it might not be possible to embark immediately on a policy that would require the United States to set up a trading policy that would give us the opportunity of selling to them as much as we are obliged to buy from them. However, I do not believe the Department of Trade and Commerce or the Department of Finance ought to be satisfied with anything less than the opportunity to sell in the United States sufficient goods and services to pay not only for our commodity imports from the United States but all of the interest, dividends and other commitments as well.
Now, it is all very well to say that we welcome foreign investment. It is all very well to say that this helps develop the country. But what has been happening over the years has been that we have been selling out more and more of our industrial establishment to pay for this. As I said, we believe that we ought to have an understanding with the United States that, on the one hand we be allowed to sell sufficient goods and services to the United States so that we balance, on the other hand, with the interest, dividends and cost of imports so far as Canada is concerned. There is only one conclusion that can come from carrying on the way we have been. If we do not have an opportunity to pay for the investments, whether it is money on loan, an investment in common stock or capital investment, the only other alternative is to sell out the ownership of our industrial establishment. In other words, Mr. Chairman, it seems to me that our aggregate obligations to the United States should be matched by the opportunity to sell the United States raw materials or manufactured goods, because I do not believe any Canadian is very happy over the prospect of selling out our industrial establishment to the tune of several hundreds of millions of dollars each year.
20220-548i
Supply-Trade and Commerce
I want to say a word or two now about this matter of wheat and flour. I join with the minister in his optimism respecting what has happened during the past 12 months. Even at the risk of repeating myself I should like to say I do not want to throw any cold water on the achievements in so far as these markets are concerned. I do not want to take anything away from this very good record. However, I should like to say to the minister the picture is not quite as bright as he indicated, particularly when we consider our position in relation to some other countries. For example, I have before me a publication from the Searle Grain Company Limited, dated June 25, 1964, and it gives an indication of what the United States has been doing during the past few months in so far as the export of grain is concerned. I quote:
For some time now, we may have tended to minimize U.S. competition by suggesting that it largely represented "give-aways" against which we in Canada could not compete. It will be noted that this is no longer true to the same extent. Over-all commercial sales by the U.S.A. this year to date are almost three times what they were during the corresponding period last year, while non-commercial or "special program" sales are only slightly higher, by less than 10 per cent.
Noted particularly should be the gain in U.S. wheat sales to such countries as United Kingdom...
During the period about which I am speaking, between 1963 and 1964, the increase in wheat sales through commercial channels from the United States to the United Kingdom was 495 per cent; to Japan it was up by 115 per cent; to the Netherlands, up 119 per cent: to Belgium, up 373 per cent; to West Germany, up 54 per cent. These are not giveaway programs, Mr. Chairman, these are sales of wheat that are going through commercial channels and for which these countries are paying.
When you look at the figures of United States regular commercial wheat sales they make our own sales of wheat and flour look a little less attractive. Again, I do not want to take anything away from the minister's achievements, but another point is that our over-all figures have not gone up as rapidly as those of the United States. Included in our expanded exports are the deals with the U.S.S.R. which we will not be able to repeat, or that at least apparently we will not be able to repeat.
Therefore, Mr. Chairman, again I voice the anxiety that we in this party have expressed on a number of times in the past. The tremendous sales we made to China and Russia are all very well, but will they take away from our efforts to expand our regular

Supply-Trade and Commerce commercial markets? If all our expansion of wheat sales are channelled into China and Russia and then are suddenly cut off, where does that leave us in relation to other friendly nations with which we should be expanding our wheat sales?
The indications of the past 12 months have shown that other nations are expanding in our traditional markets, and this is something of which many Canadian farmers are not aware. I want to repeat that I am not against the selling of wheat to communist countries, but let us not reduce our efforts to the point where other countries take over our traditional markets.
Our sales of wheat and flour to Japan have increased substantially, but we should look at what some other countries have been doing. I quote again from the Searle Grain Company report, this time from the issue of July 8:
While Canadian spring wheat continues to be the principle ingredient in Japanese bread, U.S. hard winter is gaining wider acceptance, accounting for almost half the total U.S. wheat sales to Japan last year. In 1960, before U.S. promotion began to emphasize hard winters, exports of this wheat type were insignificant.
Here again we see some of the promotional and salesmanship efforts of the United States to gain part of our traditional markets, and I hope we will not relax our efforts to build up these markets.
Turning to the production of flour, I want to compliment the minister and the government for the action they took approximately a year ago when between 29 million and 30 million bushels of the Russian wheat order were delivered in the form of flour. This was one of the greatest boosts the Canadian flour milling industry had since the end of the second world war. A year ago approximately 50 per cent of the Canadian flour milling industry was shut down, and the amount of the wheat order delivered in the form of flour was approximately the same as the total unused capacity of the industry, and its ability to turn it out during that period of time. The industry appreciated that, but at the end of July the order was fulfilled. The milling had all been done and all the ships had been loaded.
Where do you go from here? Mills are again shut down. At this point it is not particularly distressing because some maintenance work had to be carried out in the mills. A lot of back holiday time was due to employees, and I expect some of the mills have been working to restore inventories in Canada to a reasonable level. However, we


need some statement from the minister on future prospects for flour sales.
On a number of occasions the minister has told us he has had meetings with spokesmen for the flour milling industry. Each time we have asked him about these meetings his answer has been the same, that they were discussing the matter and were hoping to announce something soon. So far I have not seen any positive announcement which would indicate there will be any expansion of flour orders.
For years Canada has enjoyed a good flour market in Africa and southeast Asia, but now the United States with its giveaway programs and foreign aid, has moved in and dried up many of Canada's traditional markets for flour. Something ought to be done by our government to convince the United States that the subsidies it is paying for exporting flour, even into commercial markets, are unfair and unjust so far as its large neighbour to the north is concerned. It is difficult for our mills to compete with the United States treasury, and in closing my remarks I would impress upon the minister that we would like some positive statement regarding prospects for the Canadian flour milling industry.
We would also like the minister to make a statement on the government's policy concerning our balance of payments with the United States. It should impress upon the United States authorities that we will not be satisfied unless we are allowed to export in commodity trade to them sufficient goods so that we can pay, not only for our imports from the United States, but also for our other non-commodity obligations.
I have in my hand a copy of the statement made by the minister in the House of Commons on June 17 when he announced the initial price for grain in western Canada. In that statement he said:
I wish to inform the house that initial payments for the basic grades of western wheat, oats and barley delivered during the 1964-65 crop year will be at the same level as the present crop year.
I mention this because the minister is responsible to parliament for the Canadian wheat board, and I ask why it was that not until well in September were many farmers paid for the deliveries they made to their local elevators in August? If the government informed the wheat board on June 17 of what the initial payments were to be, why was it that the board could not authorize the elevator agents to issue the grain payment tickets until September? I know of points
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in western Canada where grain tickets were not released until the first week in September. This means that grain had been hauled to the elevators and was in storage tor five weeks before the elevator agents were authorized to pay for it.
In some cases they accepted advances under the Prairie Grain Advance Payments Act, but to me this was a silly procedure because in the middle of June the government had announced what the price would be. However, that information apparently was not communicated to the agents until September. We do not understand the reason for this. It is something which happened previously and I would like the minister to tell us why it is necessary to hold up these payments.
The minister has painted a very rosy picture of Canada's prosperity and of significant increases in trade with most nations of the world. We hope that some consideration will be given to the problem of balance of payments and to building up some of the traditional markets we rely upon for wheat exports and the export of other commodities, markets such as Japan which is interested in buying increased quantities from us.


Mr. Gauthier:: Mr. Chairman, I would like to address a few comments to the Minister of Trade and Commerce (Mr. Sharp) during consideration of his estimates, but before doing so I am going to read a few liries from the speech he made on September 28 last at the 35th annual congress of the Canadian chamber of commerce in Winnipeg.
I will then draw a comparison between what he said in his speech and the figures he is submitting to the house, as I have noticed that the minister was very enthusiastic when he made his speech and was particularly proud of export figures for the year. We are as pleased as he is, for we can see that he is giving special importance to exports in general and to wheat exports, a subject I shall not deal with here, since the member who spoke before me covered the matter very thoroughly. And it was only proper that he should do so, because the prairie people always know how to defend their special product-wheat-and we cannot hold that against them.
Mr. Chairman, I will quote some paragraphs from the speech which the minister delivered on September 28:
To link the prosperity of Canada with its flourishing exportations has become a platitude. In fact, it is now evident that the increase in the gross national product in 1964 will be higher than the
Supply-Trade and Commerce 7 per cent which it almost reached last year, which shows an increase in the rate of our development.
The increase in our exports greatly contributed to this sustained expansion. For the period 1960 to 1963, Canada's merchandise exports increased by 30 per cent; to date, the exportations in 1964 increased by 23 per cent as compared with 1963.
If the exceptional wheat sales are not taken into account-
This is exactly the point which I want to forget this evening, and the minister does not take it into account, because he speaks about merchandise exports.
-exports are up by 17 per cent.
A little further, the minister says:
However, according to available figures up to this day, this improvement of our external accounts was not maintained this year. The accelerated growth in the Canadian economy accompanied by sharply expanded capital expenditures has entailed a new upsurge in import demands. The merchandise imports-
Mr. Chairman, I draw the attention of the house to these words:
So far in 1964, merchandise imports are up by 17 per cent over 1963, and payments for non-merchandise items are also up sharply.
Mr. Chairman, after reading those few lines, a question naturally comes to my mind. Who derived more benefit from these exports? To whom does the importation of manufactured goods, often made out of our exports of raw materials, cost more?
Even though we boast about being an exporting country, if foreign investors-since foreign capital is used to develop our natural resources-benefit from our exports to an extent of 80 per cent, Canadians must be satisfied with crumbs.
On the other hand, if the increase in our imports is equal to the volume of our exports for 1963-64, as suggested by the minister, and taking into account that Canadians are paying for 80 per cent of those imports, it means that the imbalance between our exports and our imports results in a double loss for the Canadian people in general.
Indeed, as we export mainly raw materials, thus disposing of our natural resources at a dizzy rate, we only guarantee crumbs for our people.
On the other hand, we import at an accelerated rate finished products which could advantageously come out of Canadian factories, thus avoiding the drain on Canadian capital necessary to the upsurge of our economy.
What is the purpose of building our economy by always reinforcing the top in such a way that, one day, the foundations will suddenly collapse?

Supply-Trade and Commerce
Is it not wiser for a responsible businessman to satisfy the customers who are close at hand before trying to get the business of distant communities?
If, after his first ventures, the merchant finds himself with a surplus, it is normal for him to try to expand his operations. The same holds true for our trade relations. To try to make an exception to the general rule is to court deficits and bankruptcy. We are ridden with debts and deficits at present. The worst part of it is that we refuse to admit that we have made a mistake; indeed, so-called brilliant people claim that the countries and provinces which are getting into debt are those which are run by truly able administrators. We must come to our senses and realize that an economy has to be built from the bottom up and not from top to bottom.
At the risk of being at variance with our great socialistically minded economists, I will again state those great principles. Being the bridge between production and consumption, trade must not destroy one to protect the other. On the other hand, if the welfare of the individual is the end product of any economic system, one must get down to the level of the individual to assess the damage caused by an economy which fails to accomplish its purpose because one of its elements, trade, is not directed towards the achievement of the primary goal.
Is our trade not a striking illustration of the famous trade in ivory, which was practiced in African countries, when foreigners destroyed everything on that continent, giving the poor natives but a few pennies while removing all the wealth from their country.
In order to increase exports mostly carried on by foreigners, we are bleeding our country. For instance, in order to increase our pulp and paper exports, we let foreign companies ruin our forests without compelling them to renew them.
, Why not compel those companies to replant a tree, under the pretext that this will give $6 a cord to the lumberjack, while this same cord of wood will net from $140 to $150 to that company to which all possible guarantees have been granted?
I am not opposed to lumber exports, but I believe they should be rational or-so our socialists may better understand-planned.
I say that trade should first serve regional interests, through the creation of manufacturing industries, for the requirements of the district, the province and the country. After
IMr. Gauthier. 1
this first stage foreign countries may benefit from our surpluses.
But, for God's sake, let us stop giving our raw materials at ridiculous prices and import them afterwards as finished products at astronomical prices.
That is the main reason for our adverse trade balance which reached the terrifying amount of $1,500 million in 1959 and which we reduced to $500 million in 1963, by allowing this national suicide of our natural resources.
If we keep that pace, Mr. Chairman, we will be able to pride ourselves of having sold out the wealth of our children.
Fortunately, the minister gives us a gleam of hope in indicating that he shall turn to domestic trade.
In fact if we take a look at page 6 of the report of his conference, we read:
Exports are important, but let us not forget that about four fifths of our national product is disposed of on the domestic market and that a very large share of that percentage is represented by the interprovincial flow of goods and services.
There is at least one story that the minister leaves us as a consolation and I hope wholeheartedly that it will not be merely a consolation but that he will make it a policy.
If the minister really wants to work in the way he indicated in his conference, he must absolutely turn to primary industry. And we shall succeed in that field by developing our domestic trade, the nearest to us and also the most important.
A man is only as free as he is self-supporting. The same applies to a nation. Our trading ideal must be a self-supporting Canada. To hit such a target, there is only one way: the development of our manufacturing industries.
Let us take a look at countries where planning was made from the bottom up, that is where private industry was the ward of the nation: we realize with great pleasure that such countries are not plagued with unemployment.
In Canada, where we have all the opportunities, we are obliged to import too many essential products because of irresponsible governments which were unable or unwilling to help our fellow citizens in their efforts.
That is a very serious failing. And when those governments took pleasure in bombarding the few Canadian industries that had had the courage to establish themselves with every type of tax, to the point of wiping them out, I cannot find words strong enough to qualify their actions.

Today taxes on Canadian industry and Canadian capital remain the public enemy No. 1 of our industrial and commercial development. Canadian capital is now being called up through all the propaganda media -it being added that this is how we can become masters in our own house. These calls make me think of moose hunters who imitate the beast's call the better to get it into range.
You may be sure that as soon as the new capital is on the market the tax inspectors and collectors will be on the watch. And those who are too daring had better watch out.
Do you really believe there is lack of capital in Quebec for instance? I do not. On the contrary, there are still well-lined stockings to be found in Quebec, but they are buried in the ground to avoid taxation. Canadians are not asking for very much in return for allowing the country to take advantage of the millions of dollars that are hidden away. The Minister of National Revenue (Mr. Benson) only has to assure them that they will be granted the same exemptions as those granted foreign capital in their own country.
Do you really believe that Canadian interests are better served by dealing so strictly with Canadian capital? Do you believe you are helping Canadian trade to develop by submitting small and medium industry belonging to Canadians to unbearable fiscal obligations? I believe that so far you have achieved exactly the opposite results.
Eliminate taxes on all Canadian capital for a few years. Grant some tax exemptions not only to the industries which dare to settle in a depressed area, but to any new industry, in order to enable them to survive the difficult first years.
In a few years you will be glad for having permitted new industries to make a new contribution to our trade.
The government is not to be given too much credit for the increase in our raw materials exports, since that increase is the result of a further ransacking of our natural resources to the benefit of foreign countries.
If, after supplying 90 per cent of the domestic market, the government should announce a high percentage of finished products in our exports, then it would deserve our congratulations.
Again, the time of long speeches should be over and the government should take immediate action at the regional level, through efficient and well planned marketing. Guar-
Supply-Trade and Commerce anteed markets is the key to the survival of our industries.
Let us consider agriculture. What made western Canada prosperous as it is today? The marketing of their products. When western farmers did not have those guaranteed markets, they were poorer than our Quebec farmers.
We need markets for our dairy products and their by-products. Markets for all our market-gardening industry, for our apples, honey, maple syrup, potatoes and all our fruits, wild as well as cultivated.
The Minister of Trade and Commerce travels around the world selling wheat, as if wheat is the only thing Canada produces. And when we talk "consumer goods", again we talk about wheat. This one-track-minded-ness must cease; let us start looking upon the whole country as a possible trade zone, and not only upon one area of the country.
They say: We are going to double our efforts with regard to our domestic trade. There has been enough talking; it is high time we started finding the markets the eastern producers have been waiting for.
The minister has told us that he will oppose the economic balkanizing of Canada. I wonder if we have not been doing exactly the contrary for the last 25 years.
Let us first have trade equity within Canada; we can then be proud of a flourishing foreign trade, after having achieved the real goal of any sound economic system, the supplying of the domestic market, for the "better-being" of every individual.


Mr. Oito:: Mr. Chairman, I notice the minister looking my way and I assure him that I will be very brief. I should like to make one or two comments in respect of the remarks of the hon. member for Burnaby-Richmond. I do not see him in the house at this time, but he suggested that it would be a good idea for members of parliament to attend classes and receive lectures from the ministers. This is a novel suggestion in my opinion because I think members of parliament do not generally want to listen to lectures on the part of ministers, but rather deliver lectures to ministers.
Mr. Chairman, I intend to confine my remarks to that very limited item in these estimates in connection with tariffs on automobile parts and the related agreement. If I understand the situation correctly, under a proposed agreement, Canada would allow the import of certain parts made in the United

Supply-Trade and Commerce States, provided Canada could export an equivalent amount of parts. I understand some of the manufacturers of United States automobile parts are not happy about this arrangement and are urging the government not to put tariffs on our exports because that would, in the vernacular, queer the whole deal.
Mr. Chairman, I think the suggestion proposed in respect of this automobile parts agreement represents a very important part of our export policy, and I hope to see this type of thing adopted as trade principle. I certainly urge the minister to do everything possible to keep this agreement in effect.
In view of certain objections on the part of United States automobile parts manufacturers toward this agreement, will it not be possible to include, so far as Canada is concerned, not only car parts but parts for farm tractors, motorcycles and other pieces of machinery of this type? I suggest this machinery all falls within the same or a similar category.
As one hon. member opposite has stated, everything should be done to continue these transactions, because it is possible for this country to maintain a balance of trade, yet not really use to capacity our own resources. One must consider that we sell $1,700 million of aluminum, but that amount actually represents electric power, transportation and other services. Does it mean on the other hand that we can import $1,700 million of automobile and farm machinery parts? The same situation is true in respect of the export of gas and other raw materials, or a combination of them.
We will eventually have to propose to other nations with which we hope to carry on trade that we import no more than we export, or we export as much as we import. I am sure if every nation followed this practice the balance of trade would depend on quality rather than quantity, and the country which could produce an article better and more efficiently would be the country which would have a better import-export balance. I have no doubt at all that here in Canada we could develop an aircraft industry second to none in the world. We have the raw materials, cheap power and the know-how, and there is no reason at all why we should not become the world's most efficient producers of aircraft. This is a product in respect of which there is no transportation costs because an aircraft can be delivered to any place in the world.
Mr. Chairman, I suggest the outcome of the trade situation developing will depend upon

agreements such as the one I have envisaged. As an example, if I manufactured air conditioning equipment, and I might say that I have, and I exported $1,000 worth, I should receive a permit to import $1,000 worth of equipment of the same or a similar category. If I do not use that permit, rather than the government taking the tariff charges as a penalty I should be able to sell the permit on the open market. I might then receive 18 cents, 20 cents, or 30 cents on the dollar, which would help me balance my export-import situation, and would at the same time do something for the tariff position. I suggest the situation would balance out automatically and assist in providing a balance of employment and a balance in terms of supply and demand. We need to have a balance of export and import trade in accordance with skills, man-hours of skills, but not necessarily dollars because dollars are not a true criterion. I said I was going to be brief. I would urge the minister to do whatever he can with American manufacturers and the American government in this very important field, so that we may continue this agreement with the United States and be able to expand it to other categories of products from time to time.


Mr. Irvine:: Mr. Chairman, I should like to say a few words tonight with respect to trade and commerce. I was interested, and I am sure many other hon. members were, in the statement of the minister this afternoon. I am also sure that a great many will be interested in reading Hansard tomorrow in order that they may get the full portent of his complete statement including, of course, some of the statistics he quoted. He delivered his speech very rapidly. There were a number of things I should have liked to write down but that was impossible and I am sure many other members also found it impossible.
However, Mr. Chairman, I believe the first sentence the minister uttered in his report to the house this afternoon proved the falsity of the Liberal campaign charges that the Canadian economy was stagnant. The committee will recall that in March and April of 1963 many such statements were made. One of the Grit slogans of that time was: "Let's get the economy rolling again". But the minister said this afternoon and also in his speech recently at Winnipeg, I believe, that the advance in the economy commenced some four years ago. That would place it in 1960. I should like to compliment the minister on his honesty. I think what he said is

a wonderful tribute to the former minister of trade and commerce and it is also a tribute to the former minister of agriculture.
I should have liked to speak very briefly this evening on a subject which I am afraid might be forbidden. I believe the operation has been transferred from the Department of Trade and Commerce to the Department of Industry. I was going to speak rather briefly on the subject of the plight of the small businessmen and it is unfortunate I will not be able to do so, because they are having great difficulty. I believe this matter now comes under the Department of Industry. I should like to have some clarification on that point because there is so much duplication and it is difficult sometimes for a new member to know exactly what department is responsible for some of these matters. This causes a great deal of confusion particularly in the minds of the newer members.
I should also like to mention at this time that while the minister has been particularly optimistic, which is perhaps a very good thing, there have been many impediments thrown in his path, one in particular which I will mention. I refer, of course, to the 11 per cent tax on production machinery. Naturally this increases prices and when you increase prices there is a tendency toward pricing yourself out of certain markets. But in spite of that we must say that the minister's department has certainly made progress. This is what we are all looking for, of course, because I think most members of the house are first of all Canadians and, second, party supporters.
I should like to say a word or two tonight about the imbalance of our export-import trade. In 1963, for example, our trade with the United States amounted to about $8.41 billion. This represented roughly 62 per cent of our total trade. I am just wondering whether as a trading nation we are on a very sound footing when we do approximately twice as much business with the United States as we do with the rest of the world. In 1963 our purchases from the United States amounted to over $500 million more than the amount of our sales to that country. This is made somewhat more easy to take in view of our favourable trade balance, in some cases very favourable, with such countries as the Soviet union, Japan, China, West Germany and, of course, Great Britain. But I think this is a time when we should be particularly objective in our thinking because sooner or later these countries where we enjoy these more favourable trade balances
Supply-Trade and Commerce are going to demand a greater amount of our import business, and when they do we are not going to be in any position to turn a deaf ear to them if we hope to continue to enjoy the amount of business we do with them at the present time.
The minister referred to certain statistics this afternoon and I hope I have it right, that exports to the United States are up 11 per cent this year and exports to Great Britain are up 21 per cent. Mind you, on the surface this looks pretty good but let us look at the situation from another angle. In the fiscal year ended March 31, 1964 we had an increase of something like 6 per cent, and while this looks good it is not so reasonable when you consider that our general export business increase was something like 11 per cent.
Why do we export mainly only to the larger countries? I think this is something to which we should give a great deal of consideration. Why should we not look a little bit farther into the future? This afternoon we heard about what has happened in the past, but what about tomorrow and next year? What is our policy? What is the matter with our vision? Why is the bulk of our trade done with the United States, Great Britain, France and Germany?


Mitchell William Sharp: Because they are the richest
countries.


John Alfred Irvine: In 1963, for instance, we did twice as much business with France as we did with the entire Middle East. Our sales to Japan were three times our sales to all of Africa. In the whole of South America our sales were less than those to West Germany. What is the matter with our sales efforts? Some years ago I was quite interested in sales work. I had a staff of some 200 salesmen working under me and our market was the entire Dominion of Canada. We used to sit down from time to time, assess the situation, go over the whole area, mark out those areas of the territory that we covered and try to improve our sales efforts in every area.
It is our business to develop trade throughout the entire world and, knowing the Minister of Trade and Commerce as I do, I would imagine that he must be sitting down and assessing the whole picture with a view to a rapid expansion of our trade policies. There used to be an old slogan we referred to in our sales work and I am sure it would come in handy today. We used to say: "First you plan your work and then you work your plan".

Supply-Trade and Commerce
The optimism shown by the minister is a wonderful thing but you cannot allow that to go too far because the next step could possibly be apathy and maybe indifference. At some time we might find ourselves in the position of the proverbial ostrich which placed its head in the sand. I think we should pull our head out and take a very good look around to see what there is in the way of export markets where we could expand.
To take a look at the South American continent, last year we purchased from Brazil approximately $31 million worth of merchandise. However, we only sold them about $29 million worth of goods. Here is a country conveniently located, with a rapidly growing population now of over 75 million people. Surely this is a convenient market that should be explored to the nth degree. I should like to suggest, Mr. Chairman, that the accumulation of all these things could have a profound effect on balancing our budget and also in assisting us in attaining a balance of import-export trade.
There are a couple of questions I should like to leave with the minister, and I am sure he will provide the answers. First I should like to ask, what are the plans for the future? What is to be our trade policy? Second I should like to ask about the budget of Expo '67, which was mentioned in the house this afternoon. We have heard many other names for it, but I rather like this name. I should like to know what is the total cost to date to Canada of the 1967 fair which has been referred to as Expo '67.
I should like an answer to that. There are two more questions I should like to ask in connection with this exposition. What is the anticipated total cost of our 1967 world fair, that is for the entire operation? What disposition will be made of the permanent buildings. These were paid for with the taxpayers' money. What part of that money will be recaptured, and how is it to be decided? I think the public is entitled to the answer.
I should like to place it rather firmly on the record, Mr. Chairman, that I am wholeheartedly in favour of this centennial world fair or Expo '67 as you may wish to name it. I think this is a good location. When we have the Canadian national exhibition in Toronto, it would seem only right that we should have the other exhibition in the largest city in Canada.


Mitchell William Sharp: I wonder if the hon. member-


John Alfred Irvine: If the minister would give me one minute more, I shall be pleased to give him the floor.


Mitchell William Sharp: I do not want the floor, I just wanted to be clear about the question the hon. member asked so I would be able to answer it accurately. Can he tell me what he means by the first question, as to what is the expected total cost? What is the hon. member taking into account? Does he mean the net cost taking into account the revenue, or is he talking about the total investment in the exposition?


John Alfred Irvine: The total cost I had in mind is the total cost of the entire Expo '67, the total budget for the entire fair. I should like to close by saying that I think this is likely one of the finest, if not the finest public relations effort we have ever planned in the interests of this great country of ours.


Mr. Cote (Chicoutimi):: Mr. Chairman, having been engaged in international trade for several years, I am of course still very interested in problems arising out of international exchange of goods and services.
This afternoon, I listened to the Minister of Trade and Commerce (Mr. Sharp) with the same attention as that with which I follow his activities. I think the English proverb "The right man in the right place" applies very well to him. I recognize that he is a great negotiator; I must pay this tribute to him. I should also say that his parliamentary secretary is a great help to him.
Furthermore, I must add that he has the support of a remarkable team of men of great merit, stationed in strategic posts throughout the world, to conduct business on behalf of Canada. I see in the galleries several officials who second his efforts here in Ottawa. As a matter of fact, I remember a few I met in Brazil, for instance, and I could name Mr. Holton, in Sao Paulo, and Mr. Cole, in Brasilia, remarkable polyglots very anxious to expand our trade with South America.
At this stage, I should like to stress the importance for our representatives abroad to speak French and English perfectly, because those are two great international languages understood throughout the world.
It is especially during this trip that I became deeply convinced that the exchange system was definitely defective.
Mention was made over there of operagoes paralelas, parallel operations, that is, goods

exchanged against the mutual acceptance of each currency, according to a predetermined equivalence.
So when I came back it occurred to me to introduce Bill No. C-24, whose purpose was to permit the Bank of Canada to keep in its foreign reserves up to $500 million in unconvertible exchange, in order to greatly increase our external trade.
Then, an hon. member opposite said that to reach that goal, the Bank of Canada would have to sell $500 million of Canadian securities. What a monumental joke. One has to be unaware of banking operations to make such a suggestion.
That is why I should like to quote what Mr. James H. Gallager, of Toronto, wrote to me recently.

The present world monetary system Is not the type of system which promotes prosperity in all nations... All nations should exercise control of credit and currency within their own boundaries. A world monetary system does not require financial contributions from 102 member nations to operate efficiently. All that is required is for a world bank to have currency which would be used and accepted by 102 member nations to make up deficits in trading transactions between nations. Within nations themselves, the central banks of nations can balance potential consumption of goods and services with potential production of goods and services within nations.

In my opinion, this Canadian citizen in Toronto is perfectly right.
I suppose that the minister attended the meeting of the international monetary fund when he went to Japan recently.
Perhaps he had an opportunity to hear Mr. Valery Giscard d'Estaing, the French minister of finance, propose an improvement of the international payments system by the abolition of the gold exchange standard because that is the basic cause preventing the exchange of products between countries.
Incidentally, I should like to point out that Mr. Giscard d'Estaing is recognized as one of the best financial experts in the world. In fact, in its issue of September 25, 1964, Time Magazine published an article praising him highly and stated that because of his financial administration, France had a balanced budget for the first time in 34 years.
Mr. Chairman, we must open our doors to friendly countries, because Canada is a country of abundance, except for the 3,800,000 Canadians living in poverty, and we can trade with all those nations to exchange our agricultural and industrial products, and even our
Supply-Trade and Commerce services. In that regard, I think the Minister of Trade and Commerce should use all his influence to promote a Canadian foreign trade bank, on the model of the United States export-import bank, and of the French bank of foreign trade.
A Canadian foreign bank could look after credit operations concerning the financing of foreign trade, including the documentary credit, because Canada is a trading country and all banking facilities must be made available for the exchange of our products by some institution of the federal government, to which belong the monetary authority and power.
I feel that a serious mistake was made in 1961 when the government allowed chartered banks to acquire the Export Finance Corporation of Canada Limited, a company set up by a special act of parliament in June 1959, and whose main purpose was to help finance exports guaranteed by the Export Credit Insurance Corporation, a state corporation.
Through this finance company banks make further loans (bank or scrip money) which are also guaranteed by the taxes of the Canadian people. This is an abnormal combination because it is not normal that Canadian taxpayers should take all the risks instead of commercial banks.
At this point I should like to say a few words about the textile industry which faces tremendous competition because this industry employs a great number of Canadian workers and must be protected at all costs.
We know that Japan has taken a rather firm stand, but we must always keep in mind that we must protect the industries with a large labour force as it is an essential step to eliminate unemployment.
Mr. Chairman, these are a few suggestions I wanted to make to the government so as to increase our trade, because our economy is too vulnerable, as a result of the concentration of the majority of our exports to a few countries only.


Mr. Scott:: Mr. Chairman, in rising to participate in this debate I first want to say I am very sorry I was not in the chamber this afternoon. I was anxious to hear the comments of the minister, but unfortunately the work of those of us who are on the flag committee is occupying such a large amount of our time that it detracts from the opportunities we have to sit in the chamber and hear some of the proceedings. Therefore not being able to say much about the minister's speech, if I can last for another three or four minutes

Business of the House
on generalities I may have the opportunity to adjourn the debate, then study his speech and comment on it at the next opportunity.
All of us who study this department are impressed by its complexity and by the difficulties an ordinary member experiences in trying to assess a department of this size and to assess the work of the minister. One of the problems we have is a serious lack of a good statistics gathering service. I am of course thinking of the d.b.s. upon which all of us rely. The information we are able to collect is that the statistics gathering agencies of the government are starved for personnel in many areas. We hope this is wrong, but I would be interested in the minister advising the committee on the recruitment requests that have been made by the various agencies of the d.b.s., on how many people they have recruited for additions to their staff, on how many of these have been recommended by the minister and, more importantly, on how many of them have been turned down by treasury board.
It is my understanding that these agencies have requested additional staff in very considerable number, that the minister has concurred in this, but that it has been rejected by the treasury board. If this is so it is a sad state of affairs, because I do not know how the minister and, more importantly, how individual members of parliament will be able to judge some problems if they do not have the necessary statistical information available.
For example, I understand a very small degree of good planning is taking place in some areas and that the government has discontinued real studies on input and output tables with any great degree of regularity. Without this kind of economic research it is hard to know how we can do any real effective planning.
I would like to know the size of the economic research staffs. Again it is my impression they are pretty thin in numbers, and if we are to do a fair amount of planning an increase of some 200 per cent to 300 per cent is necessary in the staffs of many of our research units. If we are going to do effective planning we have to have this help available. Mr. Chairman, may I call it ten o'clock. Progress reported.



BUSINESS OF THE HOUSE

Gordon Minto Churchill: Mr. Speaker, I would like to ask the house leader about the business for tomorrow and an outline of the business for next week.


Guy Favreau: For tomorrow, Mr. Speaker, -and about this I have advised the house leaders-we will first proceed with item No. 70, which is a resolution to refer the matter of the water levels of the great lakes system to the standing committee on mines, forests and waters. I expect, or hope at least, that the discussion on that matter will be relatively short. Then we will take the balance of the estimates of the Department of Mines and Technical Surveys, after which we will proceed with discussing the balance of the estimates of the Department of Citizenship and Immigration. This will be followed by the estimates of the Department of Defence Production, to be followed by the estimates of the Department of Trade and Commerce.
On Monday we will resume debate on the farm machinery bill, after which we will take the resolution on the Crop Insurance Act, which will be followed by second reading of the bill to amend certain acts admin-stered by the Department of Insurance.


Eric Alfred Winkler: Let us do the first three tonight.



SUGGESTED HOLIDAY ON THANKSGIVING DAY.

Guy Favreau: Mr. Speaker, I wonder if the house would agree to revert to motions.


The Acting Speaker (Mr. Batten):: Does the house agree to revert to motions?


Some hon. Members:: Agreed.


Guy Favreau: Mr. Speaker, I wonder if the house would give unanimous consent to not sitting on Thanksgiving day, Monday, October 12?


Robert Gordon Lee Fairweather: What recess have you got in mind?


Gilles Grégoire: Mr. Speaker, our party is not immediately prepared to give its unanimous consent so that the house will not sit on that Monday, because the Minister of Justice (Mr. Favreau) did not tell us why we should not sit on that day.
As we have a lot of work to do, we believe that the population of this country deserves that we work on its behalf and that it would be to its advantage for us to sit on Monday, October 12 next, like on any other day of the week.
That is why we refuse to give unanimous consent.


Eric Alfred Winkler: Mr. Speaker, in speaking to this particular matter, inasmuch as October 12 will be the day of the visit of Her Majesty to the capital, and inasmuch as the Queen is the Queen of Canada, we suggest that the motion the house leader is putting before the house is the only course that should be followed.


Stanley Howard Knowles: Mr. Speaker, we would
favour such an order being made, but perhaps the Minister of Justice (Mr. Favreau) might let this matter stand until tomorrow. I think if we had a meeting of the house leaders on the point we could probably arrive at agreement a little quicker than we can here and now. If my understanding is correct, the minister has not taken it up with any of us, although I think he had the right to assume that we would agree to such a proposal. However, Mr. Speaker, perhaps if we had a meeting we could reach agreement.


Guy Favreau: Mr. Speaker, I am ready to state that it was just sheer enthusiasm or optimism on my part; but I had given notice to the hon. member for Lapointe (Mr. Gregoire).


Gordon Minto Churchill: Let us agree to it right now. That is just obstruction.


Eric Alfred Winkler: Let us have it right now.


The Acting Speaker (Mr. Batten):: Order. Does the house give unanimous consent not to sit on Monday, October 12?


Some hon. Members:: Agreed.


Some hon. Members:: No.


The Acting Speaker (Mr. Batten):: There is no unanimous consent.


Gilles Grégoire: No, Mr. Speaker.


Mr. Alkenbrack:: What is the reason for that?



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
A motion to adjourn the house under provisional standing order 39A deemed to have been moved:

Thomas Clement (Tommy) Douglas: Mr. Speaker, for almost three weeks I have been asking the government to investigate a disturbance which took place at La Macaza,
Proceedings on Adjournment Motion Quebec, on September 9 and 10, at which time it was alleged that there was ill treatment of certain persons who participated in a peace demonstration. This afternoon the Minister of National Defence (Mr. Hellyer) gave the house a report. In my opinion that report was a travesty. In the first place, it was not an independent investigation; it was an investigation based entirely on reports from the minister's officials. I would hardly expect a report to be objective that was made by men who are asked to give their opinion on their own competency or the competency of their subordinates.
The minister endeavoured to dismiss the whole matter by quoting from a press dispatch. If it was the same one that I saw, it was a dispatch of September 10 in the Globe and Mail which said that the demonstrators were pleased with the results and that they considered the whole demonstration a successful action.
If the minister is that good at reading press reports he might also have read some of the other press reports. He might have read the press report of September 16, which gave the account of a Miss Kathleen Moses, a Queen's university student who comes from Niagara Falls, who claims to have been kicked. He might have read the report of Miss Alison Gordon of Edmonton, who said that one of the servicemen at the base who was a friend of hers wrote afterwards apologizing for the rough treatment she was given. He might have read the Globe and Mail of September 17, which quotes Dan Daniels of Montreal, Andre Cardinal of Montreal and Peter Boothroyd of Toronto saying there was beating and brutal treatment of some of those who took part in the demonstration. I do not know whether those statements are accurate or not. I have a letter from a woman in Montreal who participated along with her two daughters, and she said she was thrown in a ditch and so were her two daughters, that servicemen jumped on them, and that she saw people being kicked while they lay on the ground. I do not know whether these statements are accurate but there is one thing I think the house and the country should understand. These were not young roughnecks or juvenile delinquents. In the main they were young people who are pacifists. They came almost directly from the peace camp at Grindstone, Ontario operated by the Society of Friends, or Quakers, and they returned to their camp after the demonstration was over.

Proceedings on Adjournment Motion
I am not a pacifist but I submit that in a democracy every person has a right to be a pacifist and those of us who believe in democracy must preserve the rights of people who do not believe as we do. Voltaire said: "I disagree with what you say but I will defend to the death your right to say it." We must also be prepared to take the same attitude when people take certain action of which we do not approve. If these young people were breaking the law the minister had a clear course of action open to him. He could have had these people arrested and charged with obstructing traffic or disturbing the peace. If found guilty they could have been punished by due process of law, not by policemen, military or otherwise, beating them up. If we are to allow the police to use their judgment as to whether or not persons ought to be abused, we are setting our feet on the slippery path that leads to a police state.
I wrote down what the minister said this afternoon. He said that if any of these young people felt that undue force had been used he would have expected them to lay charges and follow the due process of law as laid down in the constitution. That is the most ridiculous statement I have ever heard from a minister of the crown. How would these young people, university students, set in motion the due process of law? Would they sue the Department of National Defence? Would they obtain a fiat from the Minister of Justice? Where would they get the necessary funds to enable them to prosecute the crown? Surely the minister, and the Prime Minister (Mr. Pearson), to whom I appeal, have the responsibility, when people make charges in the public press that there has been brutal mistreatment by military police, to investigate the matter

and I do not mean by having some army or air force officer look into it; I mean by appointing some impartial person or body to determine whether or not these allegations are true.
I am not anxious that anybody should be punished over this. I am anxious that if these statements are true, action should be taken so that such incidents will not happen again and so that military police or any other police be adequately trained and disciplined in order that they will not use abusive methods. Violence always begets violence, and if the crown acquiesces in the use of violence by any of its servants we are asking for the day when other groups, not pacifists but more unruly groups, will begin to think the same methods can be used by them with


impunity. I hope the government will give us a better answer tonight than the one we got this afternoon and I appeal to the government and to the Prime Minister, when he looks over the record of this debate, to institute an impartial and independent investigation in order that the people of Canada may know that there will be no recurrence of any ill treatment whether by military police or by other police who come under the jurisdiction of the government of Canada.


Mitchell William Sharp: Mr. Speaker, I rise only to say to the house and to the hon. member for Burnaby-Coquitlam (Mr. Douglas), that the Minister of National Defence (Mr. Hellyer) is unavoidably absent this evening, otherwise he would be here to reply to my hon. friend. I shall see that his remarks are brought to the attention of both the minister and the Prime Minister (Mr. Pearson).



ARTS, LETTERS AND SCIENCES-SUBSIDIES TO CULTURAL CENTRES IN DORCHESTER COUNTY, QUE.

Pierre-André Boutin: This afternoon, on the orders of the day, I directed to the right hon. Prime Minister a question which met all the requirements, as it was very important, concise and urgent.
As the Prime Minister refused to answer this afternoon, I have deemed it advisable to discuss the matter this evening.
Since the Prime Minister and his parliamentary secretaries are not here, I would therefore ask the Minister of Citizenship and Immigration to answer my question, since he took part in the election campaign.
My question was as follows:
Can the Prime Minister tell us if his government intends to grant subsidies to the numerous cultural centres which are being promised by the Liberal party in the county of Dorchester during the current by-election campaign, and. if so, does he thereby admit that "operation agriculture" having failed in this county, the situation might be remedied through "operation culture"?
Mr. Speaker, I have been prompted to ask this question by the list of innumerable promises which appears daily in the newspapers aimed at the voters who will choose a representative on October 5 next in the counties of Dorchester, Matane, etc.
Never before have we seen in our province an auction similar to the one now in progress in these counties. The shower of promises, of subsidies is such that the people of Dorchester feel swamped; municipal parks

here, sludge plants there, confederation monument elsewhere, and many more still.
One may wonder if the $100 million the Lesage government borrowed from a Social Credit government, that of British Columbia, just before the election, will not be all squandered on highway projects, asphalt and all kinds of gifts for the Dorchester county alone.
People in the county are no fools since we could hear from electors in various ridings comments such as:	"We are getting
buried under asphalt" or "One may wonder if it would not be better for our representative to die every year".
Obviously these people are right since not a single penny had been spent in four years and within four weeks millions are being poured into the county.
But the most dazzling, the most brilliant and the most subtle of all those promises is to build "cultural centres" in almost every parish of the county of Dorchester. Just think, Mr. Speaker, in an entirely rural environment where 60 per cent of the people live from the land, cultural centres are to be built, not in order to show our farmers how to improve their land and pursue their great calling-no, our people in Dorchester are to become little intellectuals, subtle little minds, in a word, they are to become sophisticated.
Mr. Speaker, the most ridiculous aspect in all this election story, which will never be forgotten, is that some good politicians in Ottawa are going to help those auctioneers.
Indeed, we have seen the hon. member for Matapedia-Matane (Mr. Tremblay) and the hon. member for Iles-de-la-Madeleine (Mr. Sauve) "Mr. ARDA", both federal ministers, go to that riding and speak in favour of the new co-operative federalism, that is the federalism of election promises. We also heard the hon. member for Bellechasse (Mr. Laver-diere) strongly approve the decision to build cultural centres in the county of Dorchester.
Mr. Speaker, as the federal members are all for the building of such cultural centres, the federal government must have given its authorization, or have promised the government of the province of Quebec to subsidize those centres, which are to be centennial projects. As those centres have already been officially announced by the Quebec government in at least two parishes of that county, i.e. in Ste Germaine, for an amount of $100,000, and at St. Prosper for an equal amount, the federal government obviously promised to give those centres to the people.
Proceedings on Adjournment Motion
This is the answer I should like to receive from the Prime Minister. Did the government grant an amount to the Ste Germaine and St. Prosper parishes or is this promise only eyewash on the part of the Lesage government?
In my question I asked of the Prime Minister: "Does he admit that "operation agriculture" having failed, the situation might be remedied through "operation culture"?
Indeed, Mr. Speaker, agriculture is in a state of depression in our area. That is why the Liberal party does not mention the subject during this campaign; they prefer to take farmers for a ride in the clouds instead of dealing with their problems. It is certainly not ARDA which will save them.
Since Mr. Lesage is so much in favour of co-operative federalism, why does he refuse to request the assistance of the federal Minister of Agriculture to help maple sugar and syrup producers in the province of Quebec whose production was a complete failure last spring?
Since Mr. Lesage said he looks after the problems of all the people of Quebec, why did he hide when 20,000 farmers marched on Quebec city?
Those are points the premier of Quebec and the Minister of Citizenship and Immigration should explain to voters instead of encouraging the orgy of promises which takes place during these by-elections.
If Mr. Lesage is serious and sincere when he talks of co-operative federalism, he should ask as soon as possible the federal government to help farmers, instead of hiding, or turning a deaf ear to their requests.
Would the Minister of Citizenship and Immigration answer up to a certain point the questions I just put to him?


Mr. J. B. Stewart (Parliamentary Secretary to Secretary of State):: Mr. Speaker, because of a perhaps all too narrow preoccupation with federal politics and federal policies, I am not directly familiar with the particular local issues important in the provincial byelection now going on in the splendid county of Dorchester. I believe that the Prime Minister was in a somewhat similar position. Moreover, I suspect that when this question first came up this afternoon he and the Speaker concluded that this was a matter primarily within provincial jurisdiction.
Indeed, I am rather surprised to find that this matter is put down for discussion at this hour, and what the hon. gentleman has

Proceedings on Adjournment Motion just said confirms me in my wonderment at its being before us now. Nevertheless, Mr. Speaker, I believe that the hon. gentleman is looking for reassurance, and that I can make him rest easier by telling him that there is a well established tradition that Liberals strive to do those things which they promise to try to do. I am sure that in this instance this tradition will prevail.
But, sir, one aspect of the hon. member's question as he put it this afternoon caused some concern. He asked, hypothetically, if in the county of Dorchester agriculture is to be supplanted by culture. He seemed to imply that Dorchester could not sustain both at the
same time. The problem of eastern agriculture is a difficult one. I do not think I should attempt to give my views on it this evening. But I am sure the hon. member did not wish to imply that there was some sort of contradiction between agriculture and culture. I am sure that, while we may disagree as to what good government is, he would agree with me that under good government both sound agriculture and genuine culture can flourish in his fine county.


Gilles Grégoire: That is not an answer.
Motion agreed to and the house adjourned at 10.22 p.m.

Friday, October 2, 1964