1965-06-15

[Stage Direction]
Mr. John R. Malheson (Leeds) presented the first report of the Standing Committee on External Affairs, and asked for unanimous consent to move that the report be concurred in.
Mr. Gilles Gregoire (Lapointe):: Mr. Speaker, for a special reason, and since another committee is also supposed to submit a report, we should like to have the two-day notice as required by standing orders, so that the report may be studied in forty-eight hours.


Mr. Deputy Speaker:: Since there is not unanimous consent the motion may not be moved at this point.

Allow me to suggest to the hon. member for Lapointe that it might be preferable for him to raise his objection normally, that is before the Speaker reads the motion to the house.


Gilles Grégoire: Mr. Speaker, if I recall correctly, yesterday I attempted to raise my objection before you read the motion but, at that time, you called me to order; you pointed out that I could not raise it because you had not read the motion. That is what I did today.

[Note: Text of the foregoing report appears in today's Votes and Proceedings.I



BROADCASTING


Hon. Maurice Lamontagne (Secreiary of State):: Mr. Speaker, I would like to make a statement to the House on the subject of colour television. Hon. Members know that this is a matter of growing importance and concern to Canadians in view of the rapid
development of colour transmissions in the United States.
There is now clear evidence that an important part of the combined total output of the three largest American broadcasting networks will henceforth be in colour, and the rapid rise of colour set acquisitions in the United States indicates that a definite shift has taken place in that country from black and white to colour television.
Better than 50 per cent of Canadian homes with television sets are within reach of direct television signals from the United States, so that a situation is rapidly developing in Canada not unlike that of 1951-52, just prior to the commencement of Canadian television, when a large audience developed in Canada for direct American television broadcasts.
The Government has asked the Committee on Broadcasting to examine this matter and report on the situation. I reported to the House last week that the conclusions of the Committee on Broadcasting, because of the complexities of the study, cannot be available until late in the summer. I regret this, but I repeat that the subject matter of the study is indeed important and complex so that the delays were perhaps to be expected. However, the Government now finds it necessary to make a clear statement on colour television in advance of the Broadcast Committee report.
There are several reasons for this. First, it is necessary to give guidance to the Canadian electronics industry and to the broadcasters in Canada on the technical standards which will be adopted. Second, it is necessary to announce a firm commencement date for colour television in Canada so the telecommunications and broadcasting industries can work together on their plans. Third, it is necessary to authorize the Canadian Broadcasting Corporation to instal colour television equipment in the facilities which will be made available for the various countries participating in Expo '67.
The advice given to the Government by the broadcasters and the electronics industry is that up to 18 months notice must be given in advance of the commencement of colour television service so the complex engineering work and the various facilities installations can be completed.
2408	COMMONS DEBATES	June 15, 1965
Colour Television Service
The Government has decided that the transmission of colour programs from Expo in 1967 is a necessity since three or four other countries have already indicated their intention and desire to make such colour transmissions, notably the United States, Japan, Great Britain and possibly France. There may be others also since many other countries seem now to be planning for colour television within the next two years.
If there is to be a colour television service in Canada on April 1, 1967 it will be seen that the time for decision is upon us. Both the Canadian Broadcasting Corporation and the private broadcasters must be given the same advance notice and permission to proceed.
We are advised by the Committee on Broadcasting that they will recommend the commencement of colour television in Canada in 1967. They will also recommend proceeding with caution, since the implementation of colour will be a costly addition to the broadcasting budget in Canada, but that it is inevitable because of the United States colour programs.
It will, of course, be necessary for the Government to consider the cost factor very carefully, and to ensure that higher priorities, such as the extension of broadcast coverage and the necessity for improved Canadian programming, are not lost sight of.
In conclusion therefore, Mr. Speaker, I am announcing the intention of the Government, through my colleague the Minister of Transport, to prescribe the colour television standards to be applied in Canada. I am announcing also the willingness of the Government to permit the immediate application by broadcasters, under the Radio Act, for licenses for colour transmissions to commence not earlier than January 1, 1967. Finally, I am announcing the intention of the Government to authorize the C.B.C. to proceed with the necessary contractual arrangement for the installation of colour television equipment at Expo' 67 and, since the C.B.C. national English and French networks must carry these signals, the preparation of the necessary alterations to the transmitters and network facilities of the C.B.C. for this purpose. These arrangements are, of course, subject to the approval of further funds by Parliament for this purpose.
The further plans of the C.B.C. for colour should await the Broadcasting Committee report, and as I have already stated the Government will study carefully the whole

question of broadcasting priorities before making further recommendations to the House.
Eight Hon. J. G. Diefenbaker (Leader of the Opposition): I think in this case the Government has adopted a most unusual way of making a decision in respect of something of paramount importance to Canada and Canadians. We have endeavoured over and over again to bring together the House committee on broadcasting to discuss this and other matters connected with broadcasting, but without success. In every case when the need for expanding the present facilities in those areas which are now denied television has been pointed out the answer has been that nothing can be done in that connection until the Fowler Committee reports. On several occasions the hon. Member for Churchill has brought before the Government the question of the areas he represents, only to be met by a stone wall,-with statements that no action can be taken until the advisory committee makes its report.
Now suddenly the Government finds itself announcing policy with regard to broadcasting and, in particular, with regard to colour broadcasting, because of Expo '67. It is most laudable to have all the facilities available. After all we are to have a $10 million broadcasting building, and there has to be something to broadcast from the exhibition. This, apparently, is a step taken to justify the expenditure of the $10 million which, to my way of thinking, was a completely unnecessary and wasteful expenditure. I think the time has come to look into the expenditures of Expo '67 in so far as federal responsibility is concerned.
To return to the question of colour television, certainly this is a step all of us have looked forward to, but the manner in which the Government has gone about it indicates the haphazard thinking of those who sit opposite. A few weeks ago nothing could be done until the committee had reported. Now the committee has been communicated with to find out what its recommendation will be before they make it. Did you ever hear of a proposition like that? Why can we not find out what are the other recommendations the committee intends to make? Why the unearthly haste in this regard? Necessary as colour broadcasting is in the light of the advances which are taking place, the explanation given by the Minister simply indicates that this is another step in the way of Canada's policy being determined by what is necessary for Expo '67.
June 15, 1965	COMMONS
It seems to me strange to anticipate what the committee will do in advance of the report, when all over this country there are areas that are without ordinary television, and when advances in new colour television technology and broadcasting are apparently taking place in the United States. This is just another example of the kind of evasion this Government adopts toward the Parliament of Canada.
We have asked for the House committee on broadcasting to he convened, hut we have been met by arrogant indifference and cavalier disregard for the rights of Parliament, the explanation being simply that the Government cannot do this because it has set up a group of individuals outside of Parliament and must wait for their recommendations. We now are asked to accept this kind of policy placed before us haphazardly with complete disregard for the rights of Parliament.
I welcome any action that may be taken in respect of colour television in Canada, but at the same time I say that the manner of going about this indicates the uncertainty with which this Government faces the problems of the nation.


Mr. D. M. Fisher (Pori Arthur):: Mr. Speaker, the Leader of the Official Opposition might have mentioned another point about the Committee on Broadcasting which I think is even more bizarre, and that is that one of the key members of that trio is the Minster's own Deputy Minister. We have the very odd situation now of a committee recommending policy to the Government, one of whose members is the Minister's main adviser. This is certainly one of the most intriguing approaches to Government policy matters that I have encountered.
I mention this point because it just seems stupid that such major decisions affecting expenditures by the Canadian Broadcasting Corporation on such a scale are revealed to us in this way without any preliminaries at all. I wonder what kind of a committee this Committee on Broadcasting really is, in view of the fact that it has been unable to produce a report up to this time. What will be the situation if the report is projected into the future and we only have a partial tip-off?
I think it is time we knew just what duties the three members of the Broadcasting Committee are carrying out in addition to their committee work. Is Mr. Fowler still doing a considerable amount of work for the Canadian Pulp and Paper Association? Is
DEBATES	2409
Colour Television Service Mr. Lalonde still active in his legal practice, for instance, in connection with the Royal Commission on Pilotage? Is Mr. Steele, the Deputy Minister, still trying to carry a full load of departmental duties? It seems to me these are questions that need to be answered.
The Minister, I suppose anticipating a certain amount of criticism, did drag in two points that are objectionable in connection with this plan. He mentioned that the policy on the extension of television services is still incomplete. The Government has been asked about this for several years, and the C.B.C. gave a figure of $20 million in respect of the capital investment necessary to complete this program. In the meantime we are to get all this fancy stuff for Expo '67. We also have that wonderful radio station in Toronto broadcasting in French to no one or almost no one. We have also been told about the future plans for expansion all across the country-


Some hon. Members:: Shame.


Douglas Mason Fisher: My hon. friends cry "Shame". I have no objection to broadcasting of this kind, but I think there should be an audience before these expenditures are made.
The point I really want to make in relation to this announcement is that the Minister has opened up almost a Pandora's box of expenditures by the C.B.C. in preparation, yet we have not even received an undertaking from the Minister that the estimates of the Canadian Broadcasting Corporation will be placed before the committee at an early date. It just seems to me that the whole approach reflects inadequate planning.
The last point I want to make is that there is no question in my mind but that the introduction of colour television in this country will be popular. In this sense I welcome the announcement of the date and also the idea of our manufacturers being able to enter into the production of sets knowing a market is ahead of them. This will enable them to bring down the cost of such sets, which at the present time is very high.
Having said that, it certainly does not excuse the way the Committee on Broadcasting has been allowed to dawdle along in view of the carte blanche which has been given the C.B.C, in terms of expenditures on which we have no check or projection. All we have is this interesting announcement.


Mr. R. N. Thompson (Red Deer):: Mr. Speaker, I do not think anyone is going to object to the prospect of having colour television in Canada. After all, countries like
2410	COMMONS
Colour Television Service Japan have had several colour television networks for a number of years. We at least ought to be moving into this area by the time of our centennial. Therefore we approve the announcement from that standpoint.
However, I must join with those who have already spoken in criticizing the method by which this decision has been made. Surely the announcement is extremely unusual. How is it that other important matters involving broadcasting must wait until the Fowler Commission report is in, yet this particular aspect of broadcasting can move ahead without any question at all?
Another very important matter in this regard is this. How is it that we in this House are committed to the expenditure of millions of dollars to bring about colour television without even having had the privilege of considering the subject in committee? Therefore we must join in the protests which have been made in view of the fact that apparently this is not the normal procedure. I ask what is the reason behind this action.
Another interesting thing is that only yesterday it was announced by the C.B.C. that there would be a director of overseas and foreign relations. I would ask what that means. Does it mean we are going to step up our program of foreign broadcasting? Does it mean we will use some of the excellent programs which are available? Does it means still more expenditure without consultation with this House through a committee on broadcasting? Surely this whole matter should have been referred to a committee on broadcasting if it could not wait until the Fowler Commission report was presented. I think there are real grounds for protest in the strongest way of this very unusual action which has been announced today.


Gilles Grégoire: Mr. Speaker,
I would be the last to criticize the statement made by the Secretary of State (Mr. Lamontagne) to the effect that Canada will at long last have colour television. On the contrary, notwithstanding the manner in which he made that statement, I believe that he deserves congratulations. This is an era of progress, and in the field of television as well as in other areas Canada should join modern times and have colour television. That is why I am happy to congratulate the Secretary of State for the announcement he just made today, and I hope that this will be an unprecedented success.

DEBATES	June 15, 1965
Mr. Speaker, the few words which the right hon. Leader of the Opposition (Mr. Diefen-baker) said on this matter rather annoyed me. I would point out that when the Leader of the Opposition speaks, his voice seems to falter and we cannot very well understand what he says. Perhaps the microphones need adjustment or his voice may be weakening but, in any case, we can hardly hear him. On the other hand, I have noticed one thing: the Leader of the Opposition never misses an opportunity of speaking against the 1967 Worlds Fair because it is being held in the province of Quebec; he never misses an opportunity of voicing his anti-Quebec feelings.


Mr. Diefenbaker:: Mr. Speaker, there is no need for the hon. gentleman to prove his lack of a brain after making a statement like that It is entirely false and he knows it.


Mr. Deputy Speaker:: The hon. member for Lapointe knows that at this stage of the proceedings he must confine his remarks to the substance of the Secretary of State's announcement on motions.


Gilles Grégoire: Mr. Speaker, I would like to confine myself within the limits allowed the Leader of the Opposition. He deemed it advisable to criticize this decision because it favoured Expo '67. Now, I fail to see why the Leader of the Opposition takes this opportunity to criticize Expo '67. Should he not try to help make Expo '67 an outstanding success instead of provoking anti-Quebec feelings? We are shocked by such an attitude.
I heard the hon. member for Port Arthur (Mr. Fisher) say that the Toronto French language radio station was broadcasting for no one. However, in the Quebec City area, there are fewer English Canadians than there are French Canadians in the city of Toronto and we have no objections-


Mr. Deputy Speaker:: Order. I would ask the hon. member for Lapointe to limit his remarks to the substance of the announcement made by the Secretary of State.
He is not allowed at this time to deal with the Leader of the Opposition's comments. He must limit his remarks to the announcement made by the minister himself.


Gilles Grégoire: Mr. Speaker, I am going over exactly the same course allowed hon. members who spoke before me. The French language radio station in Toronto was mentioned. About that matter I wish to say that
June 15. 1965

if there are English language radio stations in the province of Quebec, we are happy-


Some hon. Members:: Order.


Gilles Grégoire: I fail to see why anyone should attack the French language radio station in Toronto as the hon. member for Port Arthur just did. It is words like these which create unfriendliness between the two nations.


Mr. Deputy Speaker:: Once more I invite the hon. member for Lapointe not to wander away from the substance of the Secretary of State's statement.


Gilles Grégoire: Mr. Speaker, I did not intend to labour the point, but everyone knows that all the hon. member for Port Arthur knows about French Canada is Maurice Richard and Lili St.-Cyr.


Some hon. Members:: Order.


Gilles Grégoire: In any event, I feel that both he and the Leader of the Opposition would make a fine pair of anti-French-Canadians.


Some hon. Members:: Order.


Gilles Grégoire: To bring my remarks to a close, I-


Mr. Deputy Speaker:: Again, I ask the hon. member for Lapointe to take under consideration the suggestion made to him by the Chair to the effect that at this time he must limit his remarks to the announcement made by the Secretary of State.


Gilles Grégoire: Very well, Mr. Speaker, I should like to point out to the Secretary of State that even if we support-


Mr. Churchill:: Mr. Speaker, on a point of order, you have now called the hon. Member for Lapointe to order on three occasions. Surely he should not be permitted to continue his remarks.


Gilles Grégoire: Mr. Speaker, I wonder
whether the Conservatives have become atonic or have lost their voices, but we did not hear one word of what he said.
In any case-


Some hon. Members:: Order, order.


Gilles Grégoire: -nothing hurts like the truth.
I should like to point out to the Secretary of State that we are in favour of colour T.V., but that many communities and places are still without any T.V. service.
Criminal Code
I think that the C.B.C. should appear before a committee of the house, because several good suggestions could be made by the representatives of the public for the benefit of French speaking and English speaking Canadians.
Mr. Speaker, in my opinion advantage should not always be taken of these announcements in connection with the C.B.C. on broadcasting to display nationalistic or anti-nationalistic feelings, as has been done today.
On the contrary we hope for a better understanding with regard to the C.B.C. so that future generations may be relieved, in Canada, of people such as the leader of the opposition and the hon. member for Port Arthur.



On the orders of the day:


Hon. J. A. MacLean (Queens):: I should like to address a question to the Secretary of State in the light of the announcement he made on motions. Can the Secretary of State advise us what estimate the Fowler Commission has made as to the cost to Canada of colour television? Could he give the House some indication of the total cost and the capital expenditure which would have to be voted by Parliament in order to provide this additional service? I would appreciate it, too, if the Minister would give us a rough estimate of the cost of a colour T.V. set as compared with the cost of an ordinary set capable of receiving only in black and white.


Maurice Lamontagne: I have been advised that the total capital cost of what I have announced will be about $15 million. As to the cost of colour television sets, I have no information to give the hon. gentleman.



CRIMINAL CODE


Mr. W. B. Nesbitt (Oxford) moved: for leave to introduce Bill No. C-117, to amend the Criminal Code (group defamatory libel).


Some hon. Members:: Explain.


Wallace Bickford (Wally) Nesbitt: Mr. Speaker, this bill seeks to expand the criminal libel sections of the Criminal Code to include hate literature, which is sometimes referred to as group defamatory libel. It would make it an offence

June 15, 1965
Inquiries of the Ministry for any group to be held up to hatred, contempt or ridicule because of racial, religious or national background. In addition it would give the officer trying such a case discretion to send an accused for mental observation for 30 days if that presiding officer should see fit to do so. I might add that evidence to the effect that many people who disseminate hate literature are to some degree mentally unstable was given by a number of expert witnesses before the External Affairs Committee last year.
I realize that there are difficulties and dangers involved in introducing legislation of this kind, and that we should only proceed with extreme caution to change the law in this regard. However, I think this bill will provide a vehicle for discussion of this subject so that Parliament may decide whether the law as it stands should in fact be changed.
Motion agreed to and bill read the first time.



DOMINION-PROVINCIAL RELATIONS QUEBEC-ADDRESS TO HER MAJESTY RESPECTING PROVINCIAL CONSTITUTION

[Stage Direction]
On the orders of the day:
John George Diefenbaker: Mr. Speaker, is the Secretary of State for External Affairs as Acting Prime Minister in a position to advise whether the Government of Canada, the Prime Minister or any other minister has received a message from the Legislative Council of the Province of Quebec in connection with a resolution passed by that body, calling upon the Federal Government to adopt an attitude of strict neutrality with regard to passing on to Her Majesty the Queen the address or resolution that was passed by the Legislative Assembly? Is the Minister in a position to advise whether the Legislative Council's address, which according to the information I have was deposited with the Lieutenant Governor of Quebec on the 11th of this month, has been transmitted to the Governor General? Would the Minister also say whether it is in order for the Legislative Council to pass on its objections and its resolution in that regard to the Prime Minister of the United Kingdom as the adviser to Her Majesty in the United Kingdom?


Hon. Paul Martin (Acting Prime Minister):: Mr. Speaker, as my right hon. friend knows, the channel of communication in such matters would be from one government to another. If one body having legislative authority in a

province takes a position involving a matter such as is purported in the telegram to which my right hon. friend refers, the communication to the Government of Canada would have to come through the proper channel, which in this instance must be the Government of the Province of Quebec. I believe that a communication of the kind my right hon. friend mentions has come in. I have not had an opportunity to give it the attention I will give it, but it will have to be perused in the light of what I believe to be the proper channel of communication.


John George Diefenbaker: Mr. Speaker, may I ask the hon. gentleman this question. Does he say that under the British North America Act the Legislative Assembly of the Province of Quebec, without the co-operation and joinder of the Legislative Council, can suggest amendments to the constitution? He said a moment ago that any body having legislative authority would forward its recommendations through the medium of the Lieutenant Governor to the Governor General. Did he by that statement indicate that the Government takes the stand that one of the three component parts of the Legislature of Quebec, namely the Legislative Council, could join with the Queen and the Legislative Assembly could be circumvented under section 71, is it, of the British North America Act?


Paul Joseph James Martin: I think my hon. friend meant to refer to section 71 of the British North America Act. I do not believe anything I said warranted the conclusion which has been put to me by way of this additional question. I simply repeat that the proper channel of communication is between Government and Government, and in this instance not between one legislative body in the Province to the Federal Government, any more than it would be appropriate for one of the Houses of this Parliament to bypass the executive in seeking to establish communication with the Crown.


John George Diefenbaker: Since the hon. gentleman has referred to one of the Houses of Parliament circumventing the constitution, does he suggest that if a resolution were passed by the House of Commons and the regular communication to the Queen is through the Government of Canada, the Senate could be circumvented in an action to abolish, change or alter the constitution?


Paul Joseph James Martin: Again I must say to my right hon. friend that I do not believe
June 15, 1965

my second response warranted the hypothetical interpretation which has just been made.



AGRICULTURE


[Stage Direction]
On the orders of the day:
Mr. T. C. Douglas (Burnaby-Coquillam):: May I direct a question to the Minister of Agriculture, and ask him if he has received any request from the Government of British Columbia for assistance to the fruit growers of the Okanagan Valley and the Fraser Valley, in view of the fact that many of their fruit trees were winter killed. Has he received any such request, and is he taking any action on it?


Hon. Harry W. Hays (Minister of Agriculture):: We answered this question last week, Mr. Speaker. We have received some inquiries from British Columbia, and at the present time the Government is considering them.


Thomas Clement (Tommy) Douglas: May I ask a brief supplementary question. Under what programs has such assistance been requested by the Government of British Columbia?


Harry William Hays: There have been a number of suggestions made. I discussed some of the problems with the British Columbia Minister of Agriculture. If there were any call for some changes in legislation, this would be government policy and would be announced in the usual way.


Mr. D. V. Pugh (Okanagan Boundary):: May
I ask a supplementary question. I understand from the Minister's answer today that there is nothing further to the answer he gave me the other day, that the Province of British Columbia itself has not made a special request to this Government. Will the Minister then tell the House immediately when he does get such a request from the Government of British Columbia?


Harry William Hays: Of course in speaking with the Minister of Agriculture from British Columbia I did state that the Federal Government did have programs that would take care of a situation like this, such as our crop insurance program under which the Federal Government puts up 20 per cent of the insurance premium in so far as the farmer is concerned, and the Federal Government pays half the administration costs.
Inquiries of the Ministry


David Vaughan Pugh: The Minister is not suggesting now that the disaster this year could be cured by legislation to establish crop insurance which would be retroactive. Is that not so?


Mr. Deputy Speaker:: Order, please; this is a question asking for a legal opinion.



QUEBEC-ASSISTANCE TO FARMERS

[Stage Direction]
On the orders of the day:
Hon. Theogene Ricard (Sainl-Hyacinthe-Bagot):: Mr. Speaker, I should like to direct a question to the Minister of Agriculture.
Could he tell the house whether he has received from the government of the province of Quebec a request for assistance to farmers of the Saint Hyacinthe area, where the crops were greatly damaged following an invasion of caterpillars?


Harry William Hays: No, Mr. Speaker.


Mr. Marcel Lessard (Lac Saint-Jean):: Mr. Speaker, I would like to direct a question to the Minister of Agriculture.
Since the people of British Columbia are interested in the havoc wrought upon Western agriculture, and since I have previously brought up a similar question with regard to agriculture in the Saguenay-Lac Saint-Jean district, has the Minister read the representations and the brief submitted by the UCC of Saguenay-Lac Saint-Jean, pointing up the sad experience of last year and requesting the assistance of the Department of Agriculture?
Second, has the Minister of Agriculture received any correspondence from the premier of the Province of Quebec in that respect? [English]


Harry William Hays: I realize the situation is very serious, but I have not received a letter from the Premier of Quebec.



CONSIDERATION OF REPORTS OF WHEAT BOARD AND GRAIN COMMISSION

[Stage Direction]
On the orders of the day:
Mr. J. H. Horner (Acadia):: In the absence of the Minister of Trade and Commerce I wish to address my question to the Minister of Agriculture. Is it the intention of the Government to refer to the committee on agriculture the annual reports of the Wheat

June 15, 1965
Inquiries of the Ministry Board and the Board of Grain Commissioners, in view of the fact that the world price for wheat has fallen by 20 cents a bushel and Australia has no wheat for sale, which leaves Canada as the only large country with wheat for sale to communist countries-


Mr. Deputy Speaker:: Order, please. The question gives information rather than seeking it.



DEFENCE PRODUCTION


[Stage Direction]
On the orders of the day:
Robert Norman Thompson: My question is directed to either the Minister of Justice or the Minister of Industry, because I am not sure to which Minister the question should be directed. It refers to the fact that four or five weeks ago some 150 tons of strategic cobalt concentrate were stolen. We have asked repeatedly for information as to who stole this cobalt and where it was taken. Perhaps the Minister could answer today as to what countries are in a position to make use of this strategic material, to which countries it is expected this cobalt has been exported.


Hon. C. M. Drury (Minister of Industry):: think the cobalt which has been reported stolen was the property of the Crown and administered by the Department of Defence Production. I will undertake to supply answers tomorrow to the questions asked by the hon. Member. I do not have at my fingertips the possible countries that might use cobalt.


Mr. Donald Maclnnis (Cape Breton South):: I understood the Minister of Industry to say the cobalt was reported to have been stolen. Is the Minister not aware whether or not it was stolen?


Charles Mills (Bud) Drury: Yes, Mr. Speaker, I am aware.



ROYAL CANADIAN MOUNTED POLICE


[Stage Direction]
On the orders of the day:
Mr. Robert Beaule (Quebec East):: Mr. Speaker, I should like to put a question to the Minister of Justice.
Has the minister requested that an investigation be made in order to find out who put a bomb on the doorstep of the R.C.M.P. building in Quebec?


Hon. Guy Favreau (Minister of Justice):: Mr. Speaker, this matter is now being investigated.


Jean Robert Beaulé: Mr. Speaker, may I ask a supplementary question? Does the minister intend to pay tribute to the Quebec municipal police constable who helped dismantle this bomb, in order to prove to the people that Quebec police constables use their heads more often than clubs?



NATIONAL CAPITAL


[Stage Direction]
On the orders of the day:
Hon. Leon Balcer (Three Rivers):: I have a question for the Acting Prime Minister. Has the Government approached the Premiers of Quebec and Ontario with a view to discussing the possibility of making the Ottawa-Hull area a federal district? Is it the intention of the Government to have this matter included in the agenda of the next Federal-Provincial conference?


Mr. Deputy Speaker:: May I suggest that this is a question for the Order Paper.



FORESTRY


[Stage Direction]
On the orders of the day:
Hon. Michael Starr (Ontario):: In view of the fact that the Minister of Forestry has claimed so many times that he was misquoted in reports in newspapers, will he clarify the report that has just appeared to the effect a definite decision has been made now to move the forestry laboratory from King, Ontario, to Sault Ste. Marie, Ontario?


Hon. Maurice Sauve (Minister of Forestry):: I gave that answer to the House of Commons on June 10, Mr. Speaker.


Michael Starr: Mr. Speaker, I rise on a question of privilege. The Minister of Forestry just said in answer to me that he answered the question on June 10. His answer on that occasion to the question asked by the hon. Member for Port Arthur will be found at page 2198 of Hansard, when he said:
There is no change in the announcement made on February 18.
February 18 was not in this session of Parliament. If the Minister of Forestry con-
June 15. 1965

tinues to evade questions in the way he has been doing, then I think something should be done to make him give direct answers to direct questions.


Maurice Sauvé: Mr. Speaker, there was a debate on that subject last night, and it the hon. Member had read Hansard this morning he would have learned what was meant by that answer. In fact I was referring to the announcement of the Department of Forestry, public information section, dated February 18, when it was announced that the regional headquarters for Ontario would be established at Sault Ste. Marie.


Michael Starr: My question was specific on this point of privilege. I asked the Minister whether the report in a newspaper was correct. All he had to do was say yes or no, instead of being evasive as he is.



CANADIAN BROADCASTING CORPORATION


[Stage Direction]
On the orders of the day:
Mr. Robert Simpson (Churchill):: I have a question for the Acting Prime Minister. In view of the announcement made today concerning the advent of colour television, and in view of the fact that the Canadian Broadcasting Corporation has publicly announced that if Parliament would provide a special grant for the extension of television network facilities this work could be done very quickly instead of the contemplated time of ten years, will the Government now take steps to provide this special grant so the people now not served by the Canadian Broadcasting Corporation network can be served as quickly as possible?


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


Mr. Gerard Laprise (Chapleau):: Thank you very much, Mr. Speaker. I should like to direct a question to the Secretary of State.
In regard to television, would he give the Chibougamau and Chapais areas the same consideration he is giving colour television in Canada?


Mr. Deputy Speaker:: That is a question for the order paper.
Inquiries of the Ministry



HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I hope the Minister of National Health and Welfare will not mind if I put this question to the Acting Prime Minister. In view of the fact that the Government has found it possible in June of 1965 to announce colour television for Canada in 1967, will the Government consider announcing, before the end of the summer, that we will have medicare in Canada in 1967?


Mr. Deputy Speaker:: Order, please.


Stanley Howard Knowles: On a question of privilege, Mr. Speaker, another question of privilege got in between my question and the Minister's answer.


Hon. Paul  Marlin@Acting Prime Minister: Mr. Speaker, we will of course be glad to consider it.


Stanley Howard Knowles: At ten o'clock, one of these nights.



FINANCE


[Stage Direction]
On the orders of the day:
Mr. H. A. Olson (Medicine Hat):: Mr. Speaker, I would like to address a question to the Minister of Finance and ask if he is aware that there has been a rather large scale attempt from outside Canada to manipulate the Canadian stock market. Further, if he is aware of this I would like to know whether any action is being taken to bring those responsible to justice, because I understand some of these phony orders were executed on the floor of the stock market.


Hon. Walter L. Gordon (Minister of Finance):: Mr. Speaker, I am sure this allegation is far fetched and extremely exaggerated, and I would not put any credence in it.



NATIONAL PARKS


[Stage Direction]
On the orders of the day:
Mr. Eldon M. Woolliams (Bow River):: Mr. Speaker, my question is directed to the Min-

June 15, 1965
Inquiries of the Ministry ister of Northern Affairs and National Resources, but first I would like to congratulate him on getting back from Siberia.


Some hon. Members:: Hear, hear.


Eldon Mattison Woolliams: My question is in connection with the tourist trade which helps correct the imbalance of trade between Canada and the United States, and is in reference to the leases of property owners, people who serve a million tourists a year. Is the Minister now prepared to make a statement to the House, because this matter affects hundreds of business people in national parks who will have to renew their leases. I have had dozens of complaints in this regard, and I want to ask what is the policy at the present time.


Mr. Deputy Speaker:: Order. The hon. Member is asking what is the policy of the Government, and I assure this is not the time for an announcement of policy.


Eldon Mattison Woolliams: Maybe I can put the question so it will be in order, like my hon. friend from another constituency. Is the Minister prepared to renew the leases of businessmen who are serving the tourist trade I mentioned in my previous questions?


Hon. Arthur Laing (Minister of Northern Affairs and National Resources):: Mr. Speaker, the situation on leases in our national parks is absolutely normal. There is no difference today in respect of such leases. If the hon. Member has a specific case he might mention it to me, and we will look into it at once.


Mr. Lambert:: Does the Minister mean to say there have been no changes?


Eldon Mattison Woolliams: I put it to the Minister that I have written to him and set out some definite cases, and I have been waiting for a reply for over a month.



ADMINISTRATION OF JUSTICE


[Stage Direction]
On the orders of the day:
Mr. Reid Scott (Danforth):: Mr. Speaker, I want to ask the Minister of Justice a question which I put to his Parliamentary Secretary yesterday, reminding him that on February 23 he told the House he would try to make an announcement on the Government's policy with regard to parole prior to the date on which the House votes on capital punishment. Has he enunciated a new policy, or does he still expect to make the announcement prior to that important vote?


Guy Favreau: Mr. Speaker, I considered this matter after my Parliamentary Secretary referred the question to me. In reconsidering the question in the light of the fact that the matter of capital punishment is to be submitted to the House to be decided by a free vote, I think it would be more proper for me not to make any assumption as to what that vote eventually will be, so as not to prejudice the question in any way. But for the information of the House I may recall that some months ago the Government amended the parole regulations to provide that in the case of a person whose death sentence has been commuted to life imprisonment, he may not be paroled except after study of his case and leave being given by the Government.


John George Diefenbaker: Mr. Speaker, with the uncertainty that prevails as to what the House may do in a free vote on the matter of the abolition of capital punishment, may I ask the Minister if it is the intention of the Government, until the vote takes place, to withhold any executions that are ordered or directed? I think that is the course that is generally followed when a matter of this nature is to be brought before Parliament. I am simply asking for information.


Guy Favreau: Mr. Speaker, I think this question has already been answered in the House. The announcement which has already been made is to the effect that pending any change in the law, or any confirmation of the law as it presently stands, each case as it comes up will be considered on its own merits.


John George Diefenbaker: That being so, Mr. Speaker, will the Minister not bring on this matter as soon as possible? It seems to me that the necessity for action to be taken by Parliament is of paramount importance, because if Parliament is going to act and abolish capital punishment, those who are today waiting sentence should not be subject to the ordinary rules that have been applicable in the past.


Guy Favreau: Mr. Speaker, it is the intention of the Government to allow the House to debate this extremely important matter as early as possible.


Mr. Orlikow:: Mr. Speaker-


Guy Favreau: I am proud to announce that the information booklet which is now prepared has been approved in draft form by the
June 15, 1965



representatives of the various opposition parties, at least on the question of whether it is sufficiently unbiased and properly balanced. The translation is being completed and printing has already commenced. Therefore I think the House Leaders will soon be in a position to get together and discuss the matter.


David Orlikow: Mr. Speaker-


Mr. Deputy Speaker:: The hon. Member for Chapleau.


David Orlikow: On a supplementary-


Mr. Deputy Speaker:: Order. May I suggest to hon. Members, in view of the fact that we are operating under a new rule which limits questions to 30 minutes, we should try as much as possible to limit supplementaries. In view of this I would like to recognize the hon. Member for Chapleau.


David Orlikow: On a point of order, Mr. Speaker, I asked the Minister a question yesterday which he said he would answer today.


Mr. Deputy Speaker:: Perhaps the hon. Member will have an opportunity to ask it again before the 30 minutes expire.


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
Marcel Joseph Aimé Lambert: On
Friday last I directed a question to the Secretary of State for External Affairs with regard to reported basic shifts in NATO policy. The Minister was good enough to say he would take the question as notice. I wonder whether he is now able to clarify the position.


Hon. Paul  Marlin@Secretary of State for External Affairs: I hope to be in a position to answer the question either tomorrow or the next day.


[Stage Direction]
On the orders of the day:
Mr. Arnold Webster (Vancouver-Kingsway):: My question is directed to the Acting Prime Minister. Is it true, as stated in an editorial in the Vancouver Sun, that though the Federal-Provincial Conference to be held in July is expected to last for a week, Premier Bennett of British Columbia has intimated that he and his Ministers plan to attend for
Inquiries of the Ministry one day and a half only because of more important commitments at home.


Paul Joseph James Martin: I shall have to review the files and find out what are the intentions of my friend the Premier of British Columbia.



FREIGHT RATES


[Stage Direction]
On the orders of the day:
Mr. H. Russell MacEwan (Pictou):: I have a question for the Minister of Transport. I want to ask him whether he can give the House any idea when the Government will make a decision on the request of Canada's two major railway companies for $142 million to meet rising wage costs.


Hon. J. W. Pickersgill (Minister of Transport):: As soon as possible, Sir.



TELEVISION


[Stage Direction]
On the orders of the day:
Mr. Jack A. Irvine (London):: I have a question to direct to the Minister of Transport. Is it the intention of the Government to control C.A.T.V. or cable transmission through amendments to the Interpretation Act, as proposed in Bill S-15 which was given first reading in the other place on June 3?


John Whitney Pickersgill: No, Sir.


Mr. A. D. Hales (Wellington South):: Can
the Minister say whether changes in this regard will be made before the Fowler Commission report is handed down?


John Whitney Pickersgill: I would think it extremely unlikely.



AGRICULTURE


[Stage Direction]
On the orders of the day:
Mr. Clement Vincent (Nicolel-Yamaska):: Mr. Speaker, I have a supplementary question for the Minister of Forestry.
Could he tell the house, in all sincerity and without resorting to devious means, whether his department proposes to make a recommendation concerning feed grain?

June 15>
1965
Inquiries of the Ministry


Maurice Sauvé: This was announced in the speech from the throne, Mr. Speaker.


Clément Vincent: Mr. Speaker, I have a supplementary question in this connection. Could the Minister say whether at this time the status quo, the first hypothesis of action stated by the Minister, is already the real policy of the government, as seemed to be the case in the last two years?


Mr. Deputy Speaker:: Order.



ROYAL CANADIAN MOUNTED POLICE


[Stage Direction]
On the orders of the day:
David Orlikow: should like to ask the Minister of Justice whether he is now in a position to answer the question I asked him yesterday regarding allegations of R.C.M.P. participation in wire tapping operations.


Guy Favreau: Yesterday 1 undertook to complete my answer to the question put to me by the hon. Member for Winnipeg North having reference to the Commissioner of the R.C.M.P. being quoted in the Telegram recently as saying that the R.C.M.P. teaches its staff methods of electronic intrusion techniques.
I have been assured by the Commissioner that this was mentioned not in relation to the use or intended use of such methods and devices by R.C.M.P. members, but exclusively in relation to the knowledge which members of the R.C.M.P. must have of modern techniques used by professional criminals or by agents involved in subversive activities so they may be better able to counteract them.
It is normal and even essential that those who are to be charged with the responsibility for maintaining order and assuring security be placed in a position to cope with the modern devices and systems, including electronic intrusion techniques, which might be used by criminals or others to offend against the order and security of the state.


Mr. Erik Nielsen (Yukon):: Can the Minister of Justice inform the House whether the Government is in possession of or owns any electronic eavesdropping devices, and whether they are in fact in use?


Guy Favreau: Mr. Speaker, I have already answered this question twice in the house lately.


Mr. Deputy Speaker:: Order. I regret to advise the House that the thirty minutes available for questions has expired.


Gilles Grégoire: Mr. Speaker, I rise on a question of privilege.


Mr. Deputy Speaker:: Is the hon. member rising on a question of privilege related to the present discussion? Otherwise, under the new rules, the hon. member must notify the Chair.


Gilles Grégoire: Mr. Speaker, this is a question of privilege arising from something which happened in the house since the beginning of this sitting, but which does not result from another question-


Mr. Deputy Speaker:: Under the new rules, the hon. member for Lapointe cannot raise a question of privilege without notice.



WAYS AND MEANS

[Stage Direction]
The House in Committee of Ways and Means, Mr. Lamoureux in the Chair.

[Stage Direction]
Resolved, that it is expedient to introduce a measure to amend the Income Tax Act and related provisions of the Federal-Provincial Fiscal Arrangements Act and to provide among other things:
1.	That for the 1966 and subsequent taxation years the income tax payable by an individual be reduced by an amount equal to the lesser of 10 per cent of basic tax or $600 and for the 1965 taxation year by an amount equal to the lesser of 5 per cent of basic tax or $300.
2.	That for the 1965 and subsequent taxation years a taxpayer may deduct in computing his taxable income an amount for the support of a person who was his niece or nephew and who during the year resided in Canada, was wholly dependant upon him for support, and was
(a)	under 21 years of age,
(b)	21 years of age or over and dependant by reason of mental or physical infirmity, or
(c)	21 years of age or over and in full time attendance at a school or university,
if
(d)	the mother of the niece or nephew was divorced or separated and not in receipt of alimony or similar payments, or
(e)	the father of the niece or nephew was deceased or mentally or physically infirm,
not exceeding $300 if the person was a child qualified for family allowance and $550 if he was not so qualified.
3.	That for the 1965 and subsequent taxation years a taxpayer may deduct in computing his taxable income an amount not exceeding $550
June 15, 1965
[Stage Direction]
expended by him during the year for the support of a person who was his aunt or uncle and who during the year resided in Canada and was dependant upon him for support by reason of mental or physical infirmity.
4.	That for the 1970 and subsequent taxation years the additional exemption of $500 now allowed to a taxpayer who has attained the age of 65 years be allowed only if the taxpayer has attained the age of 70 years and that for the taxation years 1966 to 1969 inclusive a taxpayer who has attained the age of 65 years but has not attained the age of 70 years be allowed the additional exemption of $500 only if he did not receive a pension under the Old Age Security Act in respect of any month in that year.
5.	That for the 1965 and subsequent taxation years a taxpayer who deducts in computing his income from an office or employment
(a)	annual dues to maintain membership in a trade union or to maintain membership in an association of public servants,
(b)	annual dues retained from his remuneration pursuant to the provisions of a collective agreement and paid to a trade union or association, or
(e) annual professional membership dues the payment of which was necessary to maintain a professional status recognized by statute, shall not by reason of such deduction be ineligible to deduct the standard deduction of $100 described in paragraph (ca) of subsection (1) of section 27 of the Act.
6.	That for the 1966 and subsequent taxation years a person, the spouse of such person residing with him and previously resident in Canada, or any dependant child of such person, shall be deemed to have been resident in Canada throughout a taxation year if such person was at any time in the year performing services in a country other than Canada under a prescribed international development assistance program of the Government of Canada, and was resident in Canada during a part of the year preceding the commencement of such services.
7.	That for the 1966 and subsequent taxation years a contribution made by a person under the Canada Pension Plan or under a provincial pension plan as defined in section 3 of the Canada Pension Plan may be deducted in computing the income of such person.
8.	That for the 1965 and subsequent taxation years the limitation on the amount related to earned income that a taxpayer may deduct as a premium under a registered retirement savings plan be increased from 10 per cent of earned income to 20 per cent of earned income.
9.	That for the 1965 and subsequent taxation years such part of any amount that would otherwise be included in computing income of a taxpayer as a retiring allowance be deductible if it is paid in the year, or within 60 days after the end of the year, as a contribution to a registered pension fund or plan, as a premium under a retirement savings plan, or to a trustee under a deferred profit sharing plan.
10.	That there may be deducted in computing the income of a taxpayer an amount in respect of an outlay or expense made by the taxpayer in the 1965 and subsequent taxation years
(a)	to a person with whom the taxpayer is dealing at arms length and who is the lessee of property owned by the taxpayer, to obtain the cancellation of a lease on such property,
Income Tax Act
(b)	for landscaping property used by the taxpayer for the purpose of gaining or producing income,
(c)	for clearing land or laying tile drainage for the purpose of carrying on a farming business,
(d)	as or on account of the cost of making representations to a government, municipality or other public authority in connection with a business carried on by the taxpayer, including representations for the purpose of obtaining a licence, permit, franchise or trademark,
(e)	as or on account of the cost incurred in investigating the suitability of a site for a building or other structure planned by the taxpayer for use in connection with a business carried on by him.
11.	That for the 1965 and subsequent taxation years a corporation shall be deemed to be resident in Canada throughout a taxation year if
(a)	it was incorporated in Canada before April 27, 1965 and was resident in Canada in its taxation year that included April 26, 1965 or in any subsequent on taxation year, or
(b)	it was incorporated in Canada after April 26, 1965.
12.	That with respect to payments received by a taxpayer after April 26, 1965, other than a payment made upon the death of an employee, the amount that a taxpayer may elect to have taxed under section 36 of the Act shall not exceed
(a)	in the case of a single payment
(i)	out of or pursuant to a superannuation or pension fund or plan, or
(ii)	pursuant to deferred profit sharing plan, or
(ill) pursuant to an employee's profit sharing
plan,
$1,500 times the number of years during which the employee, in respect of whom the payment was made, was a member of the plan, or
(b)	in the case of
(i)	a single payment upon retirement of an employee in recognition of long service, or
(ii)	a payment or payments made by an employer to an employee or former employee upon or after retirement in respect of loss of office or employment
$1,000 times the number of years during which the employee, in respect of whom the payment was made, was an employee of the employer who made the payment.
13.	That for taxation years commencing after April 26, 1965, a trust or estate (other than a trust or estate arising on death) that has income from a business carried on by it in Canada may not deduct in computing its income an amount paid or payable to a beneficiary who is
(a)	a non-resident of Canada,
(b)	a non-resident-owned investment corporation, or
(c)	another trust or estate resident in Canada, unless that other trust or estate
(i)	arose on a death, or
(ii)	has been since April 26, 1965 a beneficiary of the trust or estate paying the amount and the trust or estate paying the amount has been carrying on the business since April 26, 1965,
and any amount paid or payable out of the income for the year of the first-mentioned trust or estate will continue to be included in the income of its beneficiary notwithstanding the fact that the first-mentioned trust or estate was not entitled to deduct the amount in computing its income.
14.	That for the 1965 and subsequent taxation years the amount of income derived from a new mine that a corporation may exclude in computing its income shall be confined to income from the operation of the mine by the corporation.
[Stage Direction]
June 15, 1965
Income Tax Act
15.	That where a joint exploration corporation acquires after April 26, 1965 a right, licence or privilege to explore for, drill for or take petroleum, natural gas or other related hydrocarbons, the cost of the right, licence or privilege may not be renounced to a shareholder corporation.
16.	That for the 1965 and subsequent taxation years an amount that a taxpayer may exclude from his income because it is consideration for a mining property acquired as the result of his effort as a prospector, or as the result of efforts of a prospector who was employed or financially assisted by him, shall not include a share of profits, a royalty or a payment based on production.
17.	That the Minister of National Revenue with the approval of the Governor in Council may on behalf of the Government of Canada enter into an agreement with the government of a province, under which one government undertakes to transfer to the other, in respect of income tax paid by an individual from whom deductions were made at source as though he were resident in a place other than the province in which he was resident on the last day of the year, a part of the amount deducted or withheld under section 47 of the Act or a similar provision of a provincial income tax act.
18.	That in order to give effect to the provisions of paragraph 1 without reducing the amount of equalization payments to any province a consequential amendment be made to the Federal-Provincial Fiscal Arrangements Act to adjust the fractions set out therein in the definition of "standard individual income tax" used in the computation of equalization payments.
19.	That a new section be added to the Act concerning expenditures of a taxpayer for advertising space in a non-Canadian newspaper or periodical having effect substantially as follows:
"12A (1) In computing income, no deduction shall be made in respect of an otherwise deductible outlay or expenses of a taxpayer for advertising space in an issue of a non-Canadian newspaper or periodical dated after December 31, 1965 for an advertisement directed primarily to a market in Canada.
(2)	An issue or edition of an issue of any newspaper or periodical that is edited in whole or in part in Canada and printed and published in Canada and that was not on April 26,1965 a Canadian newspaper or periodical shall be deemed, for the purposes of subsection (1), not to be an issue of a non-Canadian newspaper or periodical if
(a)	through the period of twelve months ending April 26, 1965 issues or editions of issues of that publication were being edited in whole or in part in Canada and printed and published in Canada at the usual intervals for issues of that publication and have since that date continued to be so edited, printed and published without interruption except for a reason other than the cessation of the business of publishing that publication: and
(b)	in the case of a periodical, the periodical is similar, in content and in respect of the class of readers to whom it is directed, to the issues or editions of that periodical that were throughout the period of twelve months ending April 26, 1965 being edited in whole or in part in Canada and printed and published in Canada.
(3)	Subsection (1) does not apply with respect to an advertisement in a special issue or edition of a newspaper that is edited in whole or in part and printed and published outside Canada if such special issue or edition is devoted to features or news related primarily to Canada and the pub-

lishers thereof publish such an issue or edition not more frequently than twice a year.
(4)	Subsection (1) does not apply with respect to an advertisement in
(a)	a catalogue, or
(b)	any publication the principal function of which is the encouragement, promotion or development of the fine arts, letters, scholarship or religion.
(5)	In this section,
(a)	'Canadian issue' means,
(i)	in relation to a newspaper, an issue, including a special issue,
(A)	the type of which, other than the type for advertisements or features, is set in Canada,
(B)	the whole of which, exclusive of any comics supplement, is printed in Canada,
(C)	that is edited in Canada by individuals resident in Canada, and
(D)	that is published in Canada, and
(ii)	in relation to a periodical, an issue, including a special issue,
(A)	the type of which, other than the type for advertisement, is set in Canada,
(B)	that is printed in Canada,
(C)	that is edited in Canada by individuals resident in Canada, and
(D)	that is published in Canada,
but does not include an issue of a periodical
(E)	that is produced or published under a license granted by a person who produces or publishes issues of a periodical that are printed, edited or published outside Canada, or
(F)	the contents of which, excluding advertisements, are substantially the same as the contents of an issue of a periodical, or the contents of one or more issues of one or more periodicals, that was or were printed, edited or published outside Canada,
(b)	'Canadian newspaper or periodical' means a newspaper or periodical the right to produce and publish issues of which belongs to or is vested in
(i)	a Canadian citizen,
(ii)	a partnership of which at least 3 of the members are Canadian citizens and in which interests representing in value at least 2 of the total value of the partnership property are owned by Canadian citizens,
(iii)	an association or society of which at least 3 of the members are Canadian citizens,
(iv)	Her Majesty in right of Canada or a province, or a municipality in Canada, or
(v)	a corporation
(A)	that is incorporated under the laws of Canada or a province,
(B)	of which the chairman or other presiding officer and at least 3 of the directors or other similar officers are Canadian citizens, and
(C)	of which, if it is a corporation having share capital, at least 2 of the shares having full voting rights under all circumstances, and shares representing in the aggregate at least 2 of the paid-up capital, are owned by Canadian citizens or by corporations other than corporations controlled directly or indirectly by citizens or subjects of a country other than Canada; and
(c)	'issue of a non-Canadian newspaper or periodical' means an issue that is not a Canadian issue of a Canadian newspaper or periodical."
Mr. Cameron (Nanaimo-Cowichan-The Islands):: Last night I was in the midst of a surgical operation, and although I see the
June 15, 1965

patient is engaged in another consultation at the moment I will proceed with it.
[DOT] (3:40 p.m.)
Last month, you may recall, the Minister of Finance, after having disingenuously as I described it as kindly as possible, reiterated a misapprehension which he had at first including some astronomical figure which flowed from it in respect of my amendment- I may say that he did so twice in the space of five minutes-finally made what on the surface might be considered a legitimate objection to the amendment. However, when I pointed out that I thought anyone reading it with the slightest intelligent appreciation would take for granted that such amendment as I presented, would be accompanied of necessity by what are usually known as "catch provisions", the Minister proceeded to chide me for sloppy compilation of my amendment and suggested I had either been very careless or sloppy or had been deliberately trying to slip something over.
This charge of sloppy draftsmanship or, what is even worse, a rather sloppy approach to this question strikes me as being rather interesting, because this is the Minister who told us on April 26, 1965, when he was introducing an amendment to ensure that contributions to the Canada Pension Plan and the Quebec pension plan would be fully deductible in calculating taxable income-I am sorry the Minister finds it necessary to leave but I will not allow his absence to inhibit me in what I have to say, as I am sure you, Sir, will convey my comments to him.


Mr. Pennell:: Mr. Chairman, I should just like to assure the hon. Member that the Minister will return very shortly.


Colin Cameron: If what I suggested was the Minister's purpose, then it seems to me this particular budget resolution he presented on April 26 is a masterpiece of sloppy draftsmanship. Certainly those individuals in the lower income brackets will receive compensation for their contributions to pension plans, but only just enough to pay for those contributions. They would have to reach an income of some $6,800 before they could draw more in tax abatements than they pay in pension plan contributions. Let us take as an example a taxpayer with an income of $10,000, $15,000 or $20,000, or one who has reached the limit of his tax abatement of $600. In the wisdom of the Government and Parliament only individuals with incomes between $600 and $5,000 are subject to contri-
Income Tax Act
butions to the pension plan. What happens if a taxpayer has an income which is high enough to enable him to collect the maximum of $600 in the way of tax abatement? We find that he is to be given a bonus of either $520.80 or $441.60 per year, depending upon whether he is employed or self employed, is paying the whole contribution or only the employer's portion. That individual will receive this extra bonus in order that the lower income groups may be fully compensated for their payments to the pension plan. If that is not an example of sloppy draftsmanship I do not know what is.
Surely, Mr. Chairman, our Minister of Finance and his advisers are not so incompetent that they had to arrange matters so that those individuals in the upper income brackets would receive bonuses to the extent I have mentioned in order that individuals in lower income brackets may be assured that they will have their pension plan payments covered by tax rebates. I suspect that this was done because it was the easiest thing to do. I suspect it was done because it was much easier to pluck the 10 per cent figure out of the air and spread it all across the board than to revise the income tax structure.
What the Minister proposes-that is, to ensure that those individuals in the lower income bracket will have their pension plan payments covered or compensated for by the income tax rebate-is good, but I think it ill becomes the Minister of Finance to chide me for carelessness in the drafting of an amendment which is obviously a very short and simple submission to the House, without an elaborate explanation of the revisions that would be required in respect of income brackets above the level proposed, in view of the fact that he has produced legislation of this sort which will have the result of paying bonuses to people in an income bracket sufficiently high to enable them to receive the total $600 rebate. The bonuses payable will be, as I have said, $520.80 or $441.60, and are designed to ensure that individuals in the lower income brackets will be compensated. That to my mind is careless and lazy drafting, in respect of which the Minister should be severely criticized and reprimanded.
There is another matter covered by this budget resolution to which I should like to direct some comments, and I refer to that portion which deals with advertising in newspapers. I think all of us will have some sympathy with the Minister in his attempts to

June 15, 1965
Income Tax Act
encourage the development and expansion of Canadian publications, and I presume that is the purpose of this legislation. I assume that he is attempting to offset the very large extent to which foreign advertisement now influences the Canadian reader. But I am wondering whether the Minister has thought of the possible consequence of his attempt to curb advertising by Canadian advertisers in foreign newspapers and periodicals. Has it occurred to him that the result may well be not to increase advertising by Canadian advertisers in Canadian publications but possibly merely to divert this advertising to United States television and radio stations.
I suggest that in my Province there is a striking example of this at the present time. The television station at Bellingham serves to a great extent the large Vancouver metropolitan market rather than the United States centre. At the present time many Canadian advertisers take advantage of the services provided by the television station at Bellingham, and I think this sort of thing is likely to be the result of the Minister's very worthy attempts to safeguard the position of Canadian publishers of Canadian newspapers.
This brings me to another aspect of the problem, Mr. Chairman, and I hope you will be lenient with me because although it is not actually covered in these resolutions, it is related to them. The purpose of the Minister's resolution seems to be to protect and encourage the development of Canadian publications. If that is so then I think we must consider the position of these phony Canadian editions of United States publications. I have in mind two in particular, Time magazine and Reader's Digest, both of which in addition to being United States publications masquerading as Canadian publications are intrinsically vicious elements in our public media in Canada. Time magazine is tendentious, to say the least. Reader's Digest is composed, as everyone knows, of planted articles, which is the very lowest type of journalism. These two publishing firms have been allowed to set up in Canada so-called Canadian editions, which I understand are printed in Canada but the entire editorial content of which comes from New York, across the line. These two magazines come here, of course, for one purpose or one principal purpose, which is to take advantage of the very generous postal regulations in Canada with regard to periodicals.
[DOT] (3:50 p.m.)
I suggest to the Minister of Finance that if he is really concerned with protecting

Canadian publications and promoting their development he should take appropriate steps to redefine in very careful terms what constitutes a Canadian publication, in such a way as to exclude these extremely dubious publications which now masquerade as Canadian periodicals. I imagine this would entail some regulations under the Post Office Act. It might even entail some tariff revisions to keep out the editorial matter coming from New York; I am not sure of that. But I am sure the Minister, his colleagues and his staff could work out something which would prevent Time magazine and Reader's Digest from shamelessly taking advantage of the very generous provisions which we make in Canada regarding postage for periodicals.
I have always regretted, Mr. Chairman, that the provisions of the O'Leary Commission report in this regard were not carried out. I think it is idle for the Minister of Finance to imagine that he is doing anything substantial to protect our Canadian identity and to protect the position of Canadian periodicals merely by bringing in this amendment to the taxation act. It will penalize Canadian advertisers who advertise in United States publications, advertising which, according to the text of the resolution, is primarily designed for the Canadian market.
Incidentally, Mr. Chairman, this brings to mind another point. I am not quite clear how the Minister is going to decide where this advertising is directed. How is he going to determine whether it is directed to the citizens of Toronto or the citizens of Buffalo? Obviously the appeal will be made to both groups in the same manner. I suspect that this will become almost a dead letter. On the other hand, if the Minister and his colleagues will pluck up their courage and deal with these two very powerful publications and see that they are no longer allowed to masquerade as Canadian publications, then for the first time in all his commendable patriotic endeavours to protect the Canadian economy and Canadian identity he will have done something toward this end, instead of just going through the motions.


John George Diefenbaker: Mr. Chairman, I intend to confine myself to that portion of the resolution dealing with publications, and to look into the reason for and the genesis of this legislation, which in my opinion is a serious first step along the road to control of the press in Canada.
I realize there are many who feel that action should be taken to protect what is
June 15, 1965

called the Canadian identity. However, as one views this legislation one can only conclude that it has been put together most haphazardly, and that it will not achieve the purposes for which it is ostensibly intended. Indeed, an argument has just been made by the hon. Member who has just taken his seat to the effect that if it is brought into effect it can only mean that radio and television stations across the line which enjoy a tremendous influence in the border areas of our country, will become the main advertising media, and that advertising which would normally go to Canadians will join the exodus to the United States.
On the face of it I think this is dangerous legislation, dangerous in the degree to which it places in the hands of a government the power to control. A great deal of thought control has been practised by this Government during the past two years. One has but to listen to some of the broadcasts that take place and read some of the articles in the press to come to the conclusion that they have all the appearance of having been directed by the Government. Indeed, when matters which cause controversy arise in this House one can always be sure that the following day among the broadcasts over the C.B.C. will be those of commentators who explain away matters which are subject to criticism. I know it is only a coincidence, but when coincidence appears to be the regular course the ultimate conclusion is that there are other explanations than mere chance. So I say at once that in so far as this legislation is concerned it constitutes a major interference with basic principles which are inherent in the concept of freedom of the press.
This is a Government that is afraid of United States investment. This is a Government representing a party which two or three years ago was criticizing the Government of that day for being anti-American. Within a period of over two years the course taken by this Government has been antiAmerican, indeed to such an extent that it has become anti-Canadian. The Government is afraid of American investment, but it was not afraid to provide $50 million a year to the great United States automobile companies on the basis of the recent parts agreement.
Do I exaggerate the meaning of this legislation if it is implemented? Did the Canadian daily newspaper publishers talk foolishness and nonsense on May 4? This is foolishness and nonsense on the part of the Minister of Finance, the Prime Minister and possibly the Minister of Justice. The Daily Newspaper 22620-155
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Publishers Association said this proposal "is a fundamental violation of long established press freedom".
[DOT] (4:00 p.m.)
Several of those who made that statement have been avowed supporters of the Government of the day. They asked the Government to drop this legislation. I ask them now, on behalf of Her Majesty's Loyal Opposition, to drop it. This legislation is dangerous. It may not seem dangerous to those who would like to control the thinking of the people of the country, but this legislation places newspapers in all parts of Canada in a position where a first step has been taken to throttle freedom of expression. Again I point out the Daily Newspaper Publishers Association said the measure involves a fundamental violation of long established press freedom in Canada.
When I speak on behalf of the freedom of the press, may I say no one has had that freedom used against him to a greater extent than I have during the past several years. Yet, having had that experience, I assert that the maintenance of freedom of the press as more important than anything else toward the assurance of freedom within the country. That does not interest the Minister of Finance. He has ideas. He has had ideas during the last two or three years which, to use a colloquial expression, were the most cockeyed ever presented in Parliament.


Mr. Graffley:: One disaster after another.


John George Diefenbaker: He has had to withdraw most of them. He proposes and finally the Government as a whole disposes by dropping his most hoped for endeavours. The resolution said the publishers wished to record "our serious protest" against the budget proposal. It went on to say:
To employ in any degree or manner a tax restraint or incentive on advertising as a means of regulating the press of this country, or its ownership, is a fundamental violation of long established press freedom in Canada.
Who supported that? Were they political opponents, or were they people who understand freedom and its preservation? Among them were Mr. R. A. Graybiel, of the Windsor Star, Basil Dean of the Edmonton Journal, Aurele Gratton of Le Droit of Ottawa and R. S. Malone of F.P. Publications Limited. Mr. Graybiel reported that they had a good reception from the Prime Minister. It is not a good reception that is being asked; it is an end to this threatened legislation. This is what we want to achieve.

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I am referring now to a Canadian Press dispatch in the Montreal Gazette of May 5, Mr. Graybiel was asked about the Minister's statement in the House that those opposing the proposed legislation should put forth alternatives, and in reply he said that the executive of their association "had not been empowered by its 103 member papers to make such proposals".
Alternatives are not needed. When a Government introduces a resolution such as this, which cannot but have the effect of hobbling freedom, alternatives are not needed. There is only one alternative to this legislation, and that is to withdraw it and get rid of it. The Minister will grow in importance in this country by taking such action. He will not be spoiling the record of the Government. It has the greatest long distance record of running away from its proposals and throwing them overboard of any government in history. Why spoil that record by adhering to something so questionable as this proposal?
I do not often read from editorials, but I intend to make a couple of references. The Toronto Globe and Mail had an editorial entitled "Useless-And Worse". I think the Globe and Mail is one of the admirers of the Minister of Finance.


Walter Lockhart Gordon: Ha, ha.


John George Diefenbaker: I do not know what the Minister is laughing at. I have always thought the Globe and Mail held him in the highest regard.


Walter Lockhart Gordon: Mr. Chairman, I wonder whether the right hon. gentleman would allow me to comment that about the only thing we have in common is that neither of us is admired by the Globe and Mail.


John George Diefenbaker: I am always willing to hear from the hon. gentleman, but at the moment he is the Government. He represents the Government. The description "useless and worse" did not refer to him or the Government but to the proposal, although it could have been used in the wider sense had it been desired to do so. I refer now to the Fredericton Gleaner.


Walter Lockhart Gordon: Ha, ha.


John George Diefenbaker: The Minister of Finance laughs just as he laughed when we criticized his ideas in the 1963 budget, which he had to throw overboard.


Howard Russell MacEwan: He is laughing because it is a Maritime paper.


John George Diefenbaker: The Fredericton Gleaner says:
Another flaw has become apparent in the Government's budget proposal to refuse income tax credits for advertising. ..It is now rumoured that proposal may be a violation of the General Agreement on Tariffs and Trade to which Canada is a signatory.
Then it goes on to say how dangerous this legislation is. The Winnipeg Free Press had an editorial headed "Swelling Protests". They ask why the Minister did this. Why this solicitude for the newspapers? They did not ask for it. You know, Mr. Chairman, there are so many things that have been asked for, such as fairness for our old age pensioners, such as a new sense of responsibility toward the superannuated civil servants. These things have been asked for but the Government has not given them. This is something that has not been asked for by the newspapers of Canada. With reference to the resolution of the Canadian Daily Newspaper Publishers Association the Winnipeg Free Press had this to say:
The resolution also noted that, historically government influence on press freedom through taxation techniques "went on far longer and more insidiously in Great Britain than did direct censorship of news."
What that has to do with, of course, is the fact that in 1712 a stamp tax was imposed on newspapers at the rate of a penny a sheet, and by 1815 it had risen to fourpence a copy. The purpose was to restrain the abuses arising from the publication of blasphemous and seditious libels. But the action was dangerous; it interfered with freedom, and finally the tax was abolished in the 1850's. The proposal now before us brings back legislation that was abolished over 100 years ago in the United Kingdom as dangerous. The Free Press went on to say with regard to these controls:
They could lay open the way for some future and less scrupulous government to use them as a method of punishing or bestowing favours on Canadian newspapers.
The Free Press also had an editorial headed "Unwanted Protection" in which it said in part:
Whether by design or through sheer clumsiness, what the Minister proposes would give this and all future governments the power to Interfere with the right of all Canadians to read what they choose.
Nobody would say it was sheer clumsiness by this Government. The Winnipeg Free Press says that this measure strikes at the freedom of newspapers. It says also that the object, which is laudable enough, is to ensure that
June 15. 1965

essential communications media remain in the hands of Canadian citizens. The article goes on to point out the grave dangers to which these moves will lead.
[DOT] (4:10 p.m.)
I should quote from one of the greatest Canadians of our time, even though today he is living in the United Kingdom. I refer to Lord Thomson, Roy Thomson, a man whose life has been, for the most part, the embodiment of the Alger story, a man who in the operation of his vast empire of newspapers and periodicals has, as a Canadian, extended the field of public information to a degree never before known. He says this:
It Is in violation of the universal declaration of human rights of the United Nations, where Article 19 specifies that everyone has the right to freedom of information and expression, a right which includes freedom to hold opinions without interference and to seek, receive and impart information and ideas through any media.
The purpose is to prevent foreign corporations from actively controlling or directing Canadian thinking. Well, what about Time magazine? Read Time magazine week by week. As the hon. gentleman who preceded me said, it masquerades as Canadian but it has only four or six pages of Canadian news in the Canadian edition. Canadian? Read the articles, and read the degree to which, week by week, Time magazine views Canadian problems from the point of view of the Government of the day. Is the Government fearful of the control of Canadian thinking by another country? On the occasion when I visited Commonwealth countries, Mr. Chairman, I found one item in Time magazine during that entire trip which had to do with Canada, and it was in miscellany. Canada gets less attention than does a republic with a population of 300,000.
Then there is Reader's Digest, which established itself here. We should remember that these two magazines have 40 per cent of Canadian magazine advertising. It is a tremendous power to be used, if used to control Canadian thinking.
Well, from where did this all come? It did not come from the O'Leary report. The O'Leary report said nothing about newspapers. It dealt with two magazines and that is all. There was nothing about newspapers. What is wrong with advertising? What is the basis upon which this legislation has been introduced? Are we to have a mentally controlled electorate, determined in its decisions by the fear of what the Government can do? One of the vital needs of democracy is a free 22620-1551
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press to keep the public fully informed with impartiality. The performance of this function, which is indispensable to freedom, requires that the freedom of the press be maintained. I am concerned with the philosophy of the bureaucrats behind this legislation. Eight of them sit over there, former top bureaucrats, and they like to cut through things. It is their viewpoint, I am sure, which in large measure is represented by the thinking behind this legislation.
I intend to quote from one of the leaders of Liberalism today, Mr. Tom Kent. Mr. Kent is a bureaucrat today who looks after the so-called war on poverty, the war on the poor. He is above Parliament. He enjoys a position of power about which even he had to smile when he was on private television and was asked questions by young men and women. He is the father of this. Sometimes it is difficult to find the putative father of some of these ideas that spring up from time to time, but not in this case. He was in Kingston in July, 1960. I have here a copy of his speech, which was one of the longest in history, 66 pages. Most people just measured it, but I read it. I want to set out these views which represent the philosophy of this individual today as he directs the policies that should be followed. His thesis is that Government direction of economic behaviour is necessary in order to expand social security, the redistribution of wealth.
Now, all of us believe in social security. How far did that gentleman go at the meeting to which I have referred? I think it is well to quote some of the expressions used, even though quotation is sometimes very tiring. I now read from page 61:
The business expenditures that are of great fiscal interest are those on advertising and merchandising generally. This is the major respect in which, because of the imperfection of competition and the distortion induced by taxation, the "hidden hand" is not working. The magnetism of the market is not inducing business as a whole to find its profit, as in theory it does, in what the community wants. Business is engaged now in a gigantic effort to tell the community what to want.
[DOT] (4:20 p.m.)
That is his philosophy. He does not like advertising. It is not the kind of thing that should be done. Businesses should not develop and expand through advertising. It is bad for the people to consider buying what they think they would like to have. What we should have is a control over advertising so that people will only be able to buy that which the bureaucrats feel is good for them

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to purchase. If you think I overstate it I shall read on:
Business is engaged now in a gigantic effort to tell the community what to want. In the process it wastes talent: it gives every possible encouragement to wage demands, excessive personal indebtedness, and inflationary forces generally, and by stimulating unimportant wants it increases the reluctance of people to satisfy their far more important collective wants, for schools and the rest.
Socialism at its worst never equalled Kent at his best. No wonder they sometimes say that the Government is composed of socialists in a hurry. Let me read on:
I am not, of course, saying that all advertising is undesirable.
Isn't that a frank admission; not all advertising, just the kind of advertising that the bureaucrats think would be good for us. Let me read on:
I am saying that we have a tiger by the tail.
I don't quite follow that, but I presume if I took the time I could understand it.
Or, to vary the analogy, we have got our economy into a state of distorted incentives that makes us feel compelled to run faster and faster in order to stand still.
He has got something there, Mr. Chairman. That is what this Government has been doing, running faster and faster in order to stand still.
The individual business, of course, cannot do anything about this; it cannot contract out of the race while others are in it. The only profitable course is generally to try to do more and better advertising.
Then he goes on to say this:
In principle, there is no reason why advertising should not be taxed, like liquor or gasoline or thousands of other more useful things. But since in effect Government at present subsidizes most advertising to the tune of a half, through its allowance for tax purposes, the better first approach probably is to refuse to allow advertising, and perhaps other merchandising expenditures, for tax purposes.
Socialism at its worst never espoused a philosophy like that. Where would private enterprise be if it had not been for advertising? How would expansion within our country take place if the philosophy of Mr. Kent- apparently now that of the Government- were carried into effect? Then he says:
This would be, of course, a considerable upheaval.
The Minister laughs because he has read all this nonsense. He knows it all by heart and he really does not have to listen. Mr. Kent says:
It might well be approached in stages-
They are not going to abolish advertising all at once.

-in the first year adding back, say 25 per cent of advertising expenditures to a corporation's profits for tax purposes, 50 per cent the next year, and so on. That would give an opportunity for adjustment, not only to the advertisers but also to the newspapers, radio and television. I do not think, incidentally, that the lessening of their dependence on advertising would in the end do anything but good for the media of communication-
I would like to know how the media of communication could exist if they did not have advertising, but apparently I am misinformed in that connection. Then he says:
-Though for their sake-
That is for the sake of the newspapers that are denied advertising.
-it would require some offsetting tariff on the advertising content of foreign publications entering Canada-not as a discrimination, but in order to prevent inequality.
This is where the paternity is established. We are being asked to carry out the policies of the 1960 conference, and apparently this has an appeal for the Minister of Finance and the Government. Mr. Kent says in effect that if we got rid of advertising by these gradual reductions, 25 per cent in the first year and 50 per cent the next year, there would be a considerable upheaval, but he says it will not be a panacea.
This advertising proposal is not, of course, put forward as a panacea. I am not claiming it as something that will fix up our tax problems once and for all.
Then with becoming modesty he says:
I am not pretending to complete certainty that it is the right thing to do, though I am quite sure that it would yield very great benefits, and I will take a lot of persuading that there are comparable disadvantages which at all offset the benefits. However, my only basic purpose is to use it as an illustration of the approach to taxation that we should take-
Then he says this:
If, for example, we did reduce advertising-
I hope the Minister absorbs this because he can learn how he can increase taxes and make us feel good about it.
If, for example, we did reduce advertising, it would thereby become easier also to raise existing taxes on consumption-liquor revenues, gas tax, vehicle licences, real property taxes, and general sales tax. Our provincial premiers could better have their day.
What a philosophy. First he says to the people, you shall not advertise. They will have that much more money available, by being protected against being induced to purchase what, in the bureaucrats' opinion, is not good for them. They will have that
June 15, 1965

much more money available to pay taxes, including the sales tax. Then he says this:
Having mentioned property taxes, which so closely affect the most poverty stricken of our three levels of government, I would say that here increases seem very reasonable. While a general capital gains tax has many undesirable features, and certainly is not to be preferred to increased taxation of inheritance, there is a very great deal to be said for a specific tax on increments in property values, which are the consequence mostly of public decisions.
There is a compendium of economic direction by the man who has been set apart and anointed as the person who has the solution for Canada's problems. In the course of this very interesting monologue he said this:
In effect advertising is an expenditure that aims at higher consumption rather than increased efficiency.
Direct advertising expenditures in the United States last year were over $11 billion. They have doubled in nine years. This leads to waste, the waste of scientific ability in research that produces nothing but entirely trivial modifications of products for the sake of sales gimmicks.
[DOT] (4:30 p.m.)
Apparently this is the philosphy of the Government, because Mr. Kent has been raised to the position of director and controller of the war on the poor. Mr. Kent then went on to say this:
If one had to express the greatest inefficiency of our economic system in a sentence, it could well be that too much of our brain power is devoted to selling soap and too little to creative effort in science, in thought, in the public service. If I were Mr. Khrushchev it would be this above all that would give me confidence that my system was going to work.
He adds this:
It is the proper role of Government to step in and alter the incentives: simply to leave advertising less attractive and then leave every business to run its own affairs-
Apparently that is the idea. That principle was advocated last night by the Minister in the course of his remarks when he said "We do not intend to interfere with freedom; this is actually being done for the good of Canadians". Mr. Chairman, all through the ages those who would direct and control are always activated by the highest purposes, filled with a surplus of idealism. And having those qualities they do not want mankind to be deprived of the benefit of their views.
There are many other quotations which I might put on record. I do not intend to do so at the moment. I say, first of all, that these principles which are being applied are not those of the O'Leary Commission; they are based upon something entirely different,
Income Tax Act
the philosophy of social security to which I have just referred.
The freedom of the press in a society of free men depends upon commercial freedom of the press, freedom from direct or indirect Government subsidies or other forms of control. The irony of the present situation is that the Government purports to assist the press by making it impossible for outside competitors to compete. The fact is that these budgetary proposals will bring about a degree of Government control not known in this country, and not known in any country today which has inherited the British tradition of freedom.
I sum up by saying to the Government in the strongest possible terms, withdraw this measure. In 1964 the Government did withdraw, and various Members of the Liberal party sitting opposite today were quoted as being entirely opposed to what was then being considered. I suggest that today those same people should speak out in the strongest possible language against a course of action which, will inevitably lead, to a degree of control over the press which cannot and ought not to be countenanced by Parliament.
Over the years I have spoken on behalf of freedom. When I argued for a Bill of Rights, those sitting opposite said such a bill would have no purpose and no effectiveness. The law books say otherwise. Indeed, only yesterday it was announced in the press that it was expected the United Kingdom would shortly be bringing in a Bill of Rights modelled on the Canadian Bill of Rights.


Some hon. Members:: Hear, hear.


John George Diefenbaker: As one who believes in freedom, as do hon. Members in all parts of this House, I make an appeal to the Government. Throw this legislation overboard. Remove it. Throw this bill out. Withdraw it, now. Every invasion of freedom during the years has been made by people who were filled with enthusiasm for worthy objectives but who had not thought the matter through. Every invasion of freedom, begun as a pathway, has become a highway. It is because of this that I hope the Minister, having already displayed on so many occasions a capacity for withdrawing from what was not proper or appropriate, will act so as to gain the admiration of Canadians generally as well as that of the press which believes in freedom- as he believes in freedom-and as do the people of Canada as a whole.


Horace Andrew (Bud) Olson: I do not intend to deal with all the clauses in this income tax resolution be-

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fore us. Some of my colleagues will deal with particular sections of it.
I may say at the outset that we in this party are extremely disappointed at some of the omissions from this list of amendments to the Income Tax Act. We had hoped, and I think with some justification, that there would have been provision in the budget for adjusting corporation income tax as related to privately owned power corporations so that a measure of justice might be given to power users right across the country. We know that power producers which are Crown corporations or which are provincially owned are not subject to corporation income tax. Their cost of operation is therefore substantially lower and the saving is passed on to the consumer.
We noted that shortly after the Minister's budget speech had been delivered Premier Smallwood of Newfoundland had something to say about this serious omission. I am not sure whether the Minister has information about the intention of the Federal Government which has not yet been made known to this House. But he did say in effect-I do not have his actual words before me-that the budget speech was not the occasion on which to make an announcement on this subject.
I questioned the validity of that statement at the time because it seemed to me that the budget speech was a most appropriate occasion for the Minister to make an announcement dealing with corporation income tax in this particular field. Anyway, the Minister has told us on several occasions that no basic or significant changes in the Income Tax Act or the tax structure generally are intended until the commission which is studying all aspects of this matter has reported.
This report will perhaps be ready for the Minister of Finance and his officials before the next budget is prepared. We certainly hope the hon. gentleman will be able to make an announcement at that time correcting the injustice to which I have referred. I believe that three provinces only-Newfoundland, Alberta and one of the Maritime provinces; Nova Scotia, I believe-are affected by this situation. All the other power companies have been taken over by the provincial governments concerned. We certainly hope it is not the policy of the Federal Government to impose its corporation taxes in such a way as to force provincial governments to take over privately owned power generating corporations. That is what they did for British

Columbia, and we hope this will not be the situation in the future.
[DOT] (4:40 p.m.)
We also hope that if Premier Smallwood knows something about the intentions of the Federal Government which has not as yet been revealed to this House, the people of Alberta, for example, will not have to wait for the development of the Newfoundland-Labrador project in order to obtain the kind of justice to which they are entitled. We wonder whether the Federal Government is going to withdraw this tax in time for Brinco to go ahead with the enormous power development on the Churchill River at Churchill Falls, because it seems to us that this would be an important inducement to accelerate action in respect of this very large and important power development project.
I should now like to deal with paragraph 10, which in effect says that the cost of landscaping of property by a taxpayer for the purpose of gaining income may be deducted from income for the purposes of determining taxable income. It also states that the cost of clearing land by taxpayers for the purpose of gaining or producing income shall be deductible. I have asked the Minister of Finance on at least one occasion whether land levelling for irrigation purposes will be covered by the provision in respect of either landscaping or clearing of land for drainage; that is, laying drainage tile. So far he has not given a clear answer to that question. I certainly hope he makes this clear, because in the irrigation districts of Canada-I am speaking now particularly of southern Alberta-the cost of land levelling is a major expense in the operation of farms.
What is more important, Mr. Chairman, is that proper land levelling in these irrigation districts increases the potential production in some cases by more than 100 per cent. That is possible because of the even distribution of water. What is also important is that the cost of spreading water across lands that are properly levelled is substantially less than in respect of undulating surfaces. This is a legitimate cost of production in these areas which up to this time has not been allowed as an expense against income.
What is even worse is that there is no capital cost allowance for land; therefore even the actual cost of levelling cannot be included in any category in respect of which depreciation can be claimed. No depreciation is allowed in respect of land. If the cost of land levelling is to be allowed within the
June 15, 1965

provisions of this resolution-and I note that that is the case, as indicated by the Minister nodding his head-this is a correction of an injustice that has been in existence for many years.
Perhaps I should also point out that the hon. Member for Kootenay West has been an advocate on behalf of irrigation farmers for many years, and I am sure he is very pleased to note that these costs will be covered by these amendments to the Income Tax Act.
Subparagraph (d) of paragraph 10 states that a taxpayer may deduct from his income the cost of making representations to Governments, municipal or others, and public authorities in connection with a business carried on by a taxpayer, including the cost of representations for the purpose of obtaining a licence, permit, franchise, trade mark and so on. There are some very legitimate cases in respect of which the costs of representations to various levels of Government in order to obtain permits, licences and so on should be allowed, but I envisage some dangers or abuses particularly if the Government accepts any or all of the so-called costs of representation. It seems to me that this particular provision should be entitled "the lawyers' amendments", because surely it will be counsel and other advisers who will benefit most by this provision which will allow legal fees and other payments to be deducted in calculating taxable income. I hope there will be the same sort of discretion used in respect of these allowable deductions for representations that is used in respect of the cost of entertaining and that sort of thing.
I also envisage the possibility of abuse particularly in respect of-


Mr. Cowan:: You would be blind if you could not see that.


Horace Andrew (Bud) Olson: I am sorry, I did not hear the
interjection.


Ralph Bronson Cowan: You would be blind if you could not see that possibility.


Horace Andrew (Bud) Olson: Mr. Chairman, what the hon. Member for York-Humber has said is quite true. One would be blind if he could not see the possibility of abuse, yet there is some justification for these costs being deductible. However, I hope that when these costs are presented as deductions there will be safeguards provided in such a way that there will not be serious or severe abuse.
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Mr. Chairman, there are a number of other points in respect of these resolutions we wish to deal with, and other Members of this party will do so at a later stage. We intend to wait until the bill is introduced before we carry out any detailed examination.


Mr. Oito:: Mr. Chairman, I intend to confine my remarks about this resolution to that portion which deals with periodicals. I do not intend to deal with this provision in that great material sphere, but rather to come down to earth.
I was very surprised to hear the right hon. Leader of the Opposition present his views so strongly in opposition to this resolution, considering the statement which appeared on the editorial page of the Toronto Globe and Mail of May 27, 1965, under the heading "The author protests". The paragraph to which I have reference reads as follows:
The irony, of course, is that Mr. Diefenbaker is the author of the principle which Mr. Pearson would translate into law. It was Mr. Diefenbaker who, after considering the report of the O'Leary Royal Commission on Publications decided that the Government should attempt to control magazines by telling magazine advertisers where they should spend their money.
I know for a fact also that it was the hon. gentleman's suggestion that Time magazine and Reader's Digest should be exempted from this type of legislation. For those reasons I was very amazed to hear him protest so strongly.
Getting down to brass tacks, if I may use that expression, the problem is not a complicated one but a rather simple one.
[DOT] (4:50 p.m.)
As you know, Mr. Chairman, there are two types of periodicals. There are the consumer magazines and the business magazines. There are Canadian consumer magazines like Maclean's, Saturday Night and Star Weekly; and United States magazines such as Saturday Evening Post, Time, Reader's Digest and so on. These Canadian magazines are the ones in trouble, specifically Maclean's, Saturday Night and Star Weekly. These three magazines are in deep financial trouble. Two of them, Maclean's and Star Weekly, have other problems, but I shall come to this point later in order to indicate how this legislation will assist these magazines to stay in business.
Many Canadians are not aware what are the business publications. For example, there is a new magazine called the Executive, and I am sure the Minister will know it. It is the sort of magazine which is printed on very expensive paper and usually read within the

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confines of the Rideau Club or the Albany Club.


Walter Lockhart Gordon: Is that a crack at me?


Steven Otto: Not at all. This is a problem magazine. In fact most of the Canadian business publications are problem magazines. We also have trade journals. In most trades or callings there are a number of publications, but in the trade magazines no effort need be spent to induce the public to read the ads. Everyone reads the ads and no one reads the editorials. In consumer magazines everybody reads the editorials and nobody reads the ads.
Now, the main problem is this. The three specific magazines to which I referred, the consumer magazines, cannot make any profit, which is why they are in trouble.


An hon. Member:: Because of competition.


Steven Otto: Not because of competition, as an hon. Member says; it is because of unfair competition. To get down to the truth of the matter, this unfair competition comes from two magazines at the present time. Time and Reader's Digest. Time magazine is a completely independent United States magazine which stands foursquare against two things, political partisanship and the Democratic party. Reader's Digest has been called the poor man's "Paradise Lost". These two magazines have their printing costs borne in the United States, and their periodicals overflow into the Canadian market and enable them to undersell advertising which would normally go to Canadian magazines and periodicals.
I will not say much about Time and Reader's Digest; as I have said, the right hon. gentleman opposite has indicated that these two should be exempt. This is a fait accompli, in that they are already exempt; but it is not our fault that the right hon. gentleman pinpointed these two magazines for exemption. However, I wish to point out how this legislation will be of assistance to other magazines.
Along this line of thought I should like to refresh the minds of hon. Members in regard to trade publications. Maclean's is published only because its owners publish trade magazines which are profitable, and it is the profits from these trade magazines which keep Maclean's going. Even at the present time a very greedy eye is cast on these profitable Canadian trade magazines by United States concerns. I could name one, but I think most of us know which it is. They would like noth-
	j
ing better than to grab hold of this wonderful, profitable trade and business magazine market.
I am not saying for one moment that if we help these magazines to continue in business everything will be all right within a number of years. The fact is that the magazines themselves will have to improve and find new formats and new ideas. Canadian magazines will not be able to save their souls through this legislation. But when you consider that in the United States the advertising dollar is moving into the printed page, into the printing media, and that magazines in the United States, through efforts on their own behalf, have been able to pull themselves up by their own shoelaces and are now out of the red into the black, I dare say that the same situation will apply in Canada given time. But it will not apply if Canadian consumer magazines go into bankruptcy or cannot remain in existence while waiting out this time. I have the greatest confidence that the editors and publishers of our periodicals will exercise every effort, with the assistance they are given, to stay in business, and I think they will.


Gilles Grégoire: Mr. Chairman, may I point out that we do not have a quorum. There are not 20 Members in the Chamber. If you will take a count you will see we do not have
20	present. Therefore I move we do now adjourn.


The Deputy Chairman:: Order. I shall ask the Clerk to count the Committee. I understand there are 21 Members present. Therefore I declare a quorum to be present. The hon. Member for York East.


Steven Otto: Thank you, Mr. Chairman.


Gilles Grégoire: Mr. Chairman, there are only
21	because some Members came in during the time of the count.


Herman Maxwell Batten: Order. According to the rules of this Chamber, when the House is being counted Members are permitted to enter or to leave.


Steven Otto: Mr. Chairman, I know the hon. Member who just asked for a count is anxious to get away, but I will not detain him much longer.
There is another problem facing our periodicals, and it is not a United States or a foreign problem but a Canadian problem. I should like to illustrate some of the difficulties our magazines get into. We note that our weekend magazines are not only surviving but are
June 15, 1965



making a great deal of money through a completely new method of distribution. I am not saying that all magazines will have to adopt it, but given enough time they will be able to do so. But unless this legislation is implemented, more and more United States-owned magazines will adopt the same principle now being used by the two magazines I have mentioned, and will eventually be able to undercut the advertising dollar. In that event our Canadian magazines will be unable to continue.
There is one other matter I should like to raise. At the present time some of the parent companies in the United States advertise Canadian companies and Canadian goods in United States magazines which overflow into Canada. Although this cannot be termed Canadian money directly, indirectly it is because these parent companies in some cases charge their Canadian subsidiaries for a portion of the advertising dollar. I think the terms of this resolution rectify this position, and incentive will be given to permit some of the advertising dollar to stay in Canada.
If I thought for one moment that Canadian periodicals had no chance to survive I would not support this legislation, but I am sure they do have a chance. It is well recorded that the magazine is coming back into its own. I feel confident that Canadian magazines will do everything they can to devise publications which are readable and sell advertising; they just need a little bit of time. This legislation will provide the time. It will allow Canadian magazines to remain in Canadian hands and to survive the period they have been going through. As our population increases we will then be able to have not only three or four Canadian magazines, but quite a few more. The fact is that in proportion our population is increasing more rapidly than that of the United States and the number of Canadian readers is also increasing more rapidly. I honestly and sincerely believe that the Canadian periodical industry will survive, largely due to this legislation.
[DOT] (5:00 p.m.)


John (Jack) Henry Horner: Mr. Chairman, in rising to speak on the income tax resolution in Committee of Ways and Means may I first of all say that the defence put forward with regard to the newspaper control legislation is at best the weakest that could have been offered and represents a very poor defence of the Government's intention to show favouritism toward two wealthy United States magazines which, as was said earlier, are masquerincome Tax Act
ading as Canadian by publishing Canadian editions.
There are a number of things that concern me about the income tax resolution in particular. When the Minister brought down his budget he announced a number of proposed changes that cannot be found in the resolution, and may not be in the bill when it comes before the House. Actually we are all well aware of the fact that the budget gives notice of the Government's intentions and the bills that follow carry out the intentions announced in the budget.
The budget White Paper said that we are now in the fourth year of an expanding economy which started in 1961. I might add that with the devaluation of the Canadian dollar and the huge grain sales to Communist countries the expansion of our economy has continued. However, in the budget the Minister said that he feels the economy needs further stimulation and he has $250 to $275 million to pour back into the economy, or perhaps I should say that he proposes to take that much less from the economy through taxation. He suggested in the budget and in his outline of this resolution that the best way to do this is by an income tax reduction of 10 per cent. As the hon. Member for Edmonton West pointed out, this was perhaps the best political way to make a reduction in taxation, but it was a very poor way from the point of view of stimulating the economy of the country. The Minister could have turned to many other avenues if he really believed that the country needed further stimulation at this time.
Certainly it is a fact that the cost of farm loans has been increased tremendously. I wonder whether the Minister considered making any changes in the Estate Tax Act. This would have permitted more money to be poured back into the economy than will be provided by this paltry 10 per cent reduction in income tax, which does not apply to large incomes. Land prices have tripled in the last five years and to some extent this has been brought about by the easing of credit for the purchase of land. This has caused estate taxes to become out of proportion with the real value of estates now subject to taxation, or that will be in the future. Certainly such a move would have resulted in a greater amount of money being poured back into the economy than is represented by the amount of $250 million to $275 million, because this amount is being spread so thinly that it will provide very little stimulus to the economy of the country.

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As was suggested by the Minister in his speech yesterday, he could have reduced the sales tax on production machinery. In reviewing the budget speech one sees that the Minister pointed out there that in the past few years costs of production in Canada have risen to a greater extent than in the United States. In what position does this place Canada? In a very poor competitive position in relation to our greatest competitor. We import more from the United States than any other country and we export more to the United States than to any other country. Therefore we should take careful note of the relationship between the cost of production in Canada and the cost of production in the United States.
The Minister admits that costs of production have increased greatly in Canada and are greater than in the United States. Therefore it is obvious that one of the costs he should have removed in this resolution is the 11 per cent sales tax on production machinery. But no, he did not do so. Such a move would not get him too many votes if an election were called. He felt that a 10 per cent reduction in personal income tax would be the best move for this purpose. He felt that a reduction of $250 million spread across the country would affect more people, and this was his greatest concern. I think he has made a great error in this regard. He may be stimulating the Liberal party by this 10 per cent income tax reduction, but certainly he is not stimulating the Canadian economy. One could add that perhaps that was his intention in any event.
I do not want to deal with some of the provisions in the resolution at this time, but I should like to refer to paragraph 10. As a rule, changes proposed in budgets are for the purpose of directing the economy and, as we always hope, improving it. Sometimes they also plug loopholes. It would appear that paragraph 10 of the resolution is opening up something rather than plugging a loophole. In subparagraph (a) of paragraph 10 the words "to a person with whom the taxpayer is dealing at arms length" are used. As suggested by other speakers, anybody who has any dealings with a lawyer soon learns that the term "arms length" is one that makes for a great deal of debate. What is dealing at arms length, and what is not, is always questionable. Subparagraph (a) is in these words:
(a) to a person with whom the taxpayer is dealing at arms length and who is the lessee of property owned by the taxpayer, to obtain the cancellation of a lease on such property.

In other words, the purpose is to provide an income tax exemption, but the whole clause hinges on the phrase "at arms length" and, as is often said, it certainly opens up a can of worms. Certainly it opens up the avenue to many a loophole.
The second subparagraph is no better. It provides an exemption for an outlay or expense for landscaping property used by the taxpayer for the purpose of gaining or producing income. There is nothing at all to stop a person from doing an expensive landscaping job on a home he is now leasing, claiming the cost as an expense and then moving into the home the following year or two years later.
It seems odd that the Minister went out of his way either in the last budget or the one before to prevent businessmen from claiming what he said were unnecessary business expenses, and yet he is now taking this action. I know he put a ceiling on expensive cars. He said that businessmen do not have to buy expensive cars and that anything over $5,000 would not be allowed as an exemption. Then he went on to say that businessmen's travelling expenses and so on would be looked at very closely by the Income Tax Department. Now, in this budget, he is saying that you cannot buy an expensive car, but you will be allowed to do a tremendous job of landscaping if you wish. Really, all we are doing is plugging loop-holes one year and opening new ones the next.
[DOT] (5:10 p.m.)
Paragraph (c) is so poorly worded that it is not clear. It refers to the clearing of land or the laying of tile drainage for the purpose of carrying on a farming business. This will be considered for exemption. You immediately wonder if this includes the levelling of land. What is the farmer going to clear the land from-bush, rocks, or is it merely rough terrain? The hon. Member for Medicine Hat thought he saw the Minister nod his head in agreement when the hon. Member suggested it might include the levelling of land for irrigation purposes. One would certainly hope so. Why is it not set out in the paragraph? Why is there a reference to the laying of tile drainage? Why would not the construction of a drainage ditch be every bit as good? Certainly this is another method of improving farmland and thereby enabling the farmer to increase his income.
Then, in discussing changes in the Income Tax Act which might benefit the agriculture industry, one recalls that in the budget speech
June 15. 1965

the Minister suggested further income tax changes might be made to benefit that industry. He said, as reported on page 436 of Hansard:
X am also proposing some changes in capital cost allowances to help farmers who are facing difficulty in marketing com and other grain crops in areas where there is a shortage of grain storage facilities.
The Minister goes on to suggest that under this plan provisions will be incorporated in the regulations of the Income Tax Act. I say to you, Mr. Chairman, why are these provisions not spelled out in the bill? I believe that Government by regulation really defeats democracy. No one sees the regulations until they are passed. No one sees the regulations until they are in effect or until he comes up against them. Then people ask why someone did not suggest changes in these regulations. I am firmly convinced that government by regulation opens up an avenue around democracy and I, for one, do not like it.
In the same budget speech the Minister goes on to suggest another avenue which will be opened up around democracy. He states, and I quote:
An important tax concession will also be provided to encourage industry to take new steps to prevent the waste products from their operations polluting our streams and lakes. This will take the form of an amendment to the Income Tax Regulations to permit capital expenditures made until the end of 1966 by businesses primarily for the purpose of preventing water pollution to be deducted at the rate of 50 per cent.
Here again we have changes announced to the Income Tax Act, but little more will be seen of them, as I understand the procedures in the House. They will be implemented in the form of regulations and be completely lost to the House and to the people until they come face to face with them.
Returning to the provision concerning grain storage, we note that new grain storage facilities constructed during the period May 1, 1965 to December 31, 1966, will be covered. In other words, a little over a year and a half will be given for the construction of these grain storage facilities. The Minister goes on in his budget speech to suggest that after the construction of these facilities is completed on December 31, 1966, a period of four years will be given for write-off purposes in so far as income tax is concerned. Last week end the Alberta Wheat Pool opened a new grain elevator in my constituency. Since the building was opened after May 1, 1965, I wonder how the regulations will be applied to that grain elevator?
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The Minister suggested, as will be seen from page 436 of Hansard, that grain storage facilities may be built by individual farmers or taxable co-operatives. In other words, the wheat pools could take advantage of this provision. Surely, the Minister should give us some idea-he has not as yet-as to when the regulations will be applied. If a building were constructed after May 1, 1965 but not completely paid for, would the regulation apply to the whole of the cost of the building, or only to that portion which had been paid? Surely we should have some opportunity to debate this provision and perhaps enlighten the Minister and the department concerning the best possible regulations to facilitate the grain industry in both the corn belt of Eastern Canada and the wheat growing areas of the Prairies.
The Minister referred to "grain storage facilities". The question immediately comes to mind, what is going to be classified as "grain storage facilities"? Do we mean an elevator, a feed mill or some temporary building? A building may only store grain for a matter of a month, six months or a year, but the primary purpose of an elevator alongside a mill may not be considered, under these regulations, to be permanent grain storage facilities. I wonder if the Minister or his department have considered the possibility of such conditions arising? Surely, we should be given, before we pass this resolution, some idea of what the changes in the Income Tax Act will be. Surely, we should be given some further light with regard to the proposed provisions in the budget which could prove to be helpful to the farmers of Western Canada, as well as Eastern Canada. This is especially true in the light of the plans that are out for rail line abandonment, which may or may not be proceeded with this year or next year. It may be that companies in Western Canada would be well advised to make a drastic move and rebuild a great part of their grain storage facilities during this period of 16 or 18 months. I do not know.
Surely, one could judge the possibilities better if the Minister gave the details of the proposal in the resolution now before us. Surely if this means government by regulation it defeats, to a large extent, proper representations on given subjects such as this. As I said, in effect this is an avenue around democracy and I do not approve of it. I hope that later in this debate the Minister will deal more explicitly with these matters.

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Paragraph 10(d) covers:
[DOT] (5 .20 p.m.)
-the cost of making representations to a government, municipality or other public authority in connection with a business carried on by the taxpayer, including representations for the purpose of obtaining a licence, permit, franchise or trade mark.
One wonders again whether the Minister is plugging a loophole or opening one. In previous budgets he attempted to plug loopholes respecting travel costs and expense accounts generally.
The same generalization would apply to paragraph 10(e). One could travel to any part of the country ostensibly to purchase a farm or a building site, and include a holiday in the trip. Under this provision it would be up to the Income Tax Department to rule on the nature of the trip. It will be at the discretion of the department, and this is placing more power in the hands of the bureaucrats. Subparagraph (c), as the Minister said, covers drainage, ditching, etc., so there should be no difficulty there, but grain storage facilities should be included in that subparagraph.
In the world in which we live it is not a fight against capitalism or communism. It is the fight of democracy against bureaucracy, and these regulations are putting more power into the hands of the bureaucrats.
The hon. Member for Prince Albert has dealt adequately with paragraph 10. One wonders where the Government and the Minister are going when on the one hand they espouse free trade without tariffs, yet under the Bank Act and the income tax resolutions they espouse Canadianism. This is economic nationalism and the danger is retaliation by other countries. That has always been the problem in the past, and we have seen an example of it in recent legislation passed by the United States. The Liberal Party should not advocate economic nationalism to the point where it will eventually bring about a detrimental effect on the economy of Canada.


Mr, Fisher:: Mr. Chairman, I want to confine my remarks to paragraph 19, and I want to take my time approaching it. The matter is complicated. I suppose one should begin by congratulating the Minister for gaining some courage from last year. Last year the resolutions affecting periodicals were in the name of the Prime Minister, possibly because the Minister did not find himself able to accept the resolutions as they were. I do not know whether to compliment or insult him for the change of face he seems to have made, al-
[Mr. Homer (Acadia) .1
though one must admit there is a change from the resolutions of last year.
I assume the Minister was not anxious to put his name to the resolutions last year because in effect they were to Canadianize both Time and Reader's Digest. We all know there has been a considerable lobby on this issue, and almost all Members have been approached. I have had assurances from quite a number of Liberal Members that they will never put themselves in the position of supporting or voting for a measure that would Canadianize Reader's Digest and Time magazine and we hope at least once, and probably twice during this debate, to give them an opportunity to express themselves.


Mr. Moreau:: Can we assume the hon. Member is going to devise some way to split the magazine and newspaper parts of the resolution?


Douglas Mason Fisher: The hon. Member is talking about a technical difficulty that is a very real one. The word bastard, aside from its reference to birth, is also used in legal and typographical terminology, and I think we have to call this a proper bastard of a paragraph.
[DOT] (5:30 p.m.)
I would have welcomed more candour on the Minister's part last night in his definition of the measures which are being taken here to protect Canadian newspapers against getting into the ownership of non-Canadians. I thought at that time he had a very good opportunity to give us his own estimate of the reasons why he and his Government had decided to Canadianize Time and Reader's Digest. He could have made a good case for not Canadianizing Time and Readers Digest. The Minister talked last night about being consistent with the policy of the previous Government. Since when has he been proud of being consistent with the policy of the previous Government? Since when has he vaunted such consistency as being the mark of good legislation? I suggest he could have taken the other stand, namely that it was the legislation of the previous Government which ended the original legislation which Time and Reader's Digest were howling about. Then, struck by the disasters which were occurring to Canadian publications as a result of its action denying the Liberal administration's restrictions on these two publications, the Conservative Government appointed the O'Leary Commission. It seems that both the previous Government and this Government got more than they bargained
June 15, 1965

for because gentlemen like Mr. O'Leary and Mr. Johnson favoured a Canadianism which has some parallel, I suggest, with the kind of Canadianism of which the present Minister is at times accused.
So the Minister tells us that this legislation is consistent with the legislation which the previous administration intended to bring forward. But it is not consistent with the stand taken by the Liberal Government prior to 1957 which recognized the particular problem created by Time and Reader's Digest. Nor is it consistent with the views of the Royal Commission itself, and I hold it is not consistent with the views of Members in all parts of this House, including a number of Liberal Members.
I should like to talk about the aspects of this which concern the periodicals before looking at the newspaper field.


Maurice John Moreau: The hon. Member is not suggesting he is consistent?


Douglas Mason Fisher: I heard an interjection from over there by that chap who was befrazzled by what happened to his constituency today, and I will excuse him.
In the main, Mr. Zimmerman of Reader's Digest led the lobby in the periodical field for Reader's Digest and Time. Time has been a little cuter and less interested in a popular approach than Reader's Digest. Time would much prefer direct contact with Cabinet Ministers, particularly with Ministers like the Minister of Industry, who has a relationship through his constituency with the operation of these magazines. To give Mr. Zimmerman credit, I think he is the handsomest and most affable lobbyist I have encountered, with one of the best illustrative and prose presentations I have encountered. On the other hand, the main lobby against Time and Reader's Digest and for Canadianism in the periodical field has been the people who sponsor Weekend Magazine, Mr. Farrell and Mr. Walker of the Montreal Star and the Family Herald Weekly Star.
There are one or two points which could be made about these two lobbying groups. One is that of all the periodical publications in Canada, Weekend Magazine is in the best health. That is quite apparent to the present day, so one can hardly accuse Weekend Magazine of trying to advance its own self-interest-though Mr. Zimmerman makes a good effort at doing so-since it already has such a solid market across the country. As a matter of fact, it has such a good market
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through so many papers that its success is one of the main reasons, at least in my opinion, why the Toronto Star Weekly has suffered a decline in circulation from one million to less than 700,000 copies. So this particular anti-Time, anti-Reader's Digest group, while having a self-interest, has not such a degree of self-interest that its arguments do not extend to all other Canadian publications, including Liberty and Maclean's magazines.
The real oddball in the lobby field was the role of Maclean-Hunter publications. I suppose other hon. Members have encountered them. One month you are lobbied, and the next month you telephone Maclean-Hunter and you cannot even get an idea what their policy is. I have come to this conclusion: Maclean-Hunter accepted one of Mr. Zimmerman's arguments that the proper thing to do was to reach some stability in the magazine field-"let us stop fighting with each other and organize a magazine bureau to make advertising in magazines more popular, supplement each other's co-operative efforts and wrest back revenue from television, radio."


Maurice John Moreau: Is Saturday Night included in that argument?


Douglas Mason Fisher: Yes, Saturday Night is included in that argument. There is one other factor. It seems to me that since the really profitable business of their operation is in the trade field, Maclean-Hunter began to get very frightened about the prospect of McGraw-Hill, the most powerful and the most able of the United States trade publishers, moving into Toronto. There were rumours they had taken a lease on certain land in the Toronto area and were planning to get into this field.
Magic to find, there is a provision in this legislation which will prevent United States trade publications coming in from now on. It looks to me as though Maclean-Hunter were prepared to keep quiet about Time and Reader's Digest because the trade publication threat from the United States had been blocked. And I think they were suborned to a minor degree by Mr. Zimmerman's arguments that in co-operation lies a golden future. But the reality of the situation at the present time is that Reader's Digest and Time are still with us and, I suggest, they are not Canadian publications.
I recognize the kind of pressure they can apply. I have a paper mill in my constituency which produces the paper for Time and

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Reader's Digest. It was almost like magic how suddenly the management and workers there, including the unions, began to fire in correspondence to me demanding that Time and Reader's Digest be left alone as good Canadian publications consuming good Canadian paper-particularly that manufactured in the constituency of Port Arthur.


Maurice John Moreau: Surely the hon. Member is not suggesting that the union was seduced, too?


Douglas Mason Fisher: I am suggesting that where dollars and cents are concerned it is easy to lose sight of one's national ideals. I am firmly convinced the loss in terms of the paper market would, in time, be filled by Canadian publications if Time and Reader's Digest were put in their proper places.


An hon. Member:: You had better worry about your own seduction.


Douglas Mason Fisher: There are more ladies on the other side of the House than we have over here.
The point which needs to be made as we look ahead to the future is that by this legislation Time and Reader's Digest are set up for the foreseeable future in such a fashion that their main editorial content can continue to be drawn, in the main, from outside the country. I think anyone with any sense would agree, on looking at these United States publications, that this content is not produced in Canada in the main. I feel very strongly that this legislation should specifically wipe out parts of 12A(2). Later on we will attempt to move an amendment which will do this, although my colleagues and I are finding it difficult to draft. We intend to move an amendment which will specifically point to Time and Reader's Digest and classify them as non-Canadian publications under the intent of this resolution. At the very least, when this amendment is moved we should receive from the Minister a thorough explanation of his conversion from a Canadian nationalist, the author of Troubled Canada, the projector of the Canada Development Corporation, the architect of the Canada Student Loans Plan and the author of Let's Buy Back Canada, to a man who believes that Reader's Digest and Time magazine are really Canadian publications. I think we are at least entitled to that explanation.
[DOT] (5:40 p.m.)
I should now like to touch upon the newspaper aspect of this resolution. I have been very interested in this because I happen to

know quite well the publisher of the Toronto Telegram, John Bassett, and a few other publishers with whom I have had some contact. One of the things that intrigues me is the argument advanced by a few publishers that this provision that no presently Canadian-owned newspaper shall be sold to or allowed to get into the hands of a foreign corporation is a threat to the freedom of the press. I cannot for the life of me see that there is any threat in this regard to the freedom of the press.
I do understand why Lord Thomson is raising a bit of a fuss, because his feelings have been hurt as a result of what happened to him in relation to Canadian citizenship. After receiving the "lordship", which he sought for so long, because of the regulations of our Government he had, in a sense, to dissociate himself from Canadian citizenship.
I find Lord Thomson the most attractive newspaper publisher I have ever encountered. Whenever I have gone to see him he has taken out his books and shown me how much money he is making in his various operations, and he has done so with such delight that I can understand why universities such as the University of New Brunswick and the Newfoundland Memorial University fight for the right to have him as a chancellor or donor.
This is a man who has gone from a start up in Timmins-I always felt he should be Lord Porcupine of Timmins-to those great places of the world, to the point where he often merits a full page of coverage as the greatest press lord of all in such august periodicals as the New York Times and New York Tribune.


Marcel Joseph Aimé Lambert: Do not be jealous.


Douglas Mason Fisher: The hon. Member suggests that I should not be jealous. Let me assure him and other Members in this House that I genuinely find Lord Thomson to be one of the most interesting and pleasant persons I have ever encountered because he is so excited and pleased at being so successful. I think it is wonderful that a man can go from being a defeated Conservative candidate in the east end of Toronto to a lord in the House of Lords in England consorting with the great and mighty, visiting Russia on even terms with the heads of state.
Lord Thomson has a world-wide operation, and naturally he has the kind of holding company argument and the typical attitude of the businessman of large scope who does not want national boundaries to get in his way. Lord
June 15. 1965

Thomson looks upon newspaper publishing primarily as a business. You will remember what he said in England. He wanted to set up a Labour newspaper, if that was possible, not because he was Labour in his attitude but because he thought there was a market for that kind of newspaper, and it did not bother him to be the owner of a Labour or Socialistic newspaper, because the main thing was to have the ownership and advertising revenue.
This kind of publisher is a rarity, I grant you, not particularly caring what axe he is going to grind in his newspaper as a whole; but this attitude also reveals how little nationalism, particularly from a Canadian point of view, we are likely to get from Lord Thomson; and that is a worth-while revelation. It seems to me that his objections are a perfect example of the international operator, rather than a Canadian citizen.
I sometimes feel that when Mr. Bassett complains, it is because his conscience is bothering him in connection with his television operation. I do not know whether he was forced to, but he certainly did go to United States organizations to borrow capital in order to keep the television operation going. My point in respect of the publishers' objection is that if foreign ownership, as a principle, which many of us including the Minister of Finance and Members of this party advocate, is wrong because it strikes at the future of our nation and our national ethos, then this also applies to banks and to almost any field, primarily and essentially to the field of communications, through which an influence can be brought to bear on the culture, attitude and philosophy of the people.
Anyone who argues that this resolution, in so far as it applies to newspapers, should not be introduced, has to accept the fact that if it does not now, it is only a question of time until the kind of rationalization of capital that exists in Northern America and in the western world will lead to the accumulation of a Canadian chain of newspapers by an outside organization. Some of you are entitled to ask: Would that be bad? If I could get the publisher of the New York Times to come up here I think he might be a preferable owner to Lord Thomson, in terms of the kind of newspaper we would have. However, the whole point is, in essence, what are we going to get in terms of ownership; and that would not be Canadian ownership.
If it is vital to have a C.B.C., then it is vital to have Canadian publications owned by
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Canadians, wherever possible, and I support the proposition very strongly that this legislation, which will restrict the sale of Canadian newspapers in future to foreigners, is an excellent bit of legislation. I cannot see how it is going to affect the freedom of the press. It will affect the freedom of publishers, and the freedom of the publisher to dispose of his goods by selling to a foreigner.
One must recognize that this could cost the present Canadian publisher a lot of money. It is quite conceivable that the greatest capital resources of Chicago or New York, or organizations from those areas would be able to come and offer more for the Toronto Globe and Mail or the Montreal Star than any Canadian group; but even in that regard there is no way that one can look at this situation and envisage how, even if the largest of Canadian newspaper operations came up for sale-I suppose the largest of all operations is the Southam operation- it would be beyond the resources of a group of Canadians; and I am sure there would be purchasers.
The final point I want to make in connection with this whole matter is in the form of an appeal to the Government and to the Minister, on this question of Time and Reader's Digest, that we have a free vote. Perhaps it is too much to ask of or too tough on Government supporters to have them stand up and go against this whole question of Time and Reader's Digest, without something more than a tacit understanding that they are encouraged to do so by the Minister and the Government. I know that to take this approach would be a most unusual course for the Minister to follow.
[DOT] (5:50 p.m.)
I know it is unusual to advocate it, but it does seem to me that through lobbying over recent months we have had a very thorough discussion of this matter, and the issue of Time and Reader's Digest should be settled on the basis of Canadian nationalism and the way it is looked at in the future. I would suggest that the fairest way to get a vote, one which we will be prepared to accept, is to have a free vote, so that we can see on which side of the question Members of the House line up, and whether Time and Reader's Digest are to be naturalized, corporate Canadian citizens from now and forever more.


Mr. Munro:: Mr. Chairman, I should like to speak briefly regarding this particular item in the resolution. Many of us in this party have felt very strongly for some time about

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this legislation. I think it would he reasonable to say that the Minister deserves the congratulations of many of us in this House, including many hon. gentlemen opposite who have expressed some feelings in this regard in the past, despite the speech made by their leader today. He deserves our congratulations because we have been talking about legislation of this general nature and with this general theme for five or six years at least. It has been actively discussed, yet nothing has been done.
I might point out that nothing was done by the previous Government. Now something is going to be done, and for that reason I think this is a gigantic step in the direction of preserving the Canadian identity in this media, certainly of our newspapers and to a great extent our periodicals, and as such it should win the commendation of a great many Members in this House.
I should like to refer to some of the arguments made by the Leader of the Opposition today. He seemed to centre his attack upon the legislation on the basis that it was a limitation of the freedom of the press; that it was an inroad into that sacred right which we in this country have always maintained, namely that the press should be free and independent. I too was completely mystified by this approach of the Leader of the Opposition when one considers that it was the O'Leary Commission, a Commission constituted by his own Government, which made findings which were certainly very close to the precise recommendation which has been made by the Minister today and to establish this fact I intend to quote a few paragraphs from the report of the O'Leary Commission.
I am also surprised at what must be considered tantamount to a rather hypocritical stance on this question, when one considers that the right hon. gentleman himself proposed legislation of an almost identical nature in the field of periodicals, providing for similar exemptions of Time and Reader's Digest. If it can be argued that legislation of this nature is a limitation of the freedom of the press, then it is a limitation on the freedom of the press irrespective of whether Canadian periodicals or Canadian newspapers are involved. The right hon. gentleman when he was leader of the Government, and those who supported him who are present today, espoused the principle which is inherent in this legislation both in respect to periodicals and magazines. I think it is very difficult for any of them to evade that charge.
[Mr. Munro.l
Getting back to the attack made on this legislation on the basis that it limits freedom of press, in this regard I think I should refer to the report of the O'Leary Commission which deals at considerable length with this question. At page 7 of the report, the first paragraph, the following appears under the heading of "The Need for Self-Sufficiency":
That guarantee, we are convinced is vital.
That is, the need for self-sufficiency.
For while Canada and the United States may have the same basic cultures, they each at the same time have domestic and other tasks and problems-political, social and economic-which differ widely. Canada's particular responsibilities, her government, her constitutional structure, her ideals and aspirations, her memories and milestones, even her discords, are facts in her existence which cannot be approached understanding^ or usefully by communications media owned or controlled in another country, even though that country be friendly.
I emphasize that the O'Leary Commission refers to "communications media"-generalizing here-owned or controlled in another country, even though that country be friendly. The report goes on to refer to media, and surely no one would argue that newspapers are not part of the communications media. The report states:
Only a truly Canadian printing press, one with the "feel" of Canada and directly responsible to Canada, can give us the critical analysis, the informed discourse and dialogue which are indispensable in a sovereign society.
In view of this it is difficult for me to understand how the Leader of the Opposition and hon. gentlemen opposite can state that the O'Leary Commission did not recommend Canadian ownership of our daily newspapers. I do not know how anything could be more unequivocal in this regard than the paragraph to which I have just referred contained in the report of the Commission itself.
Again we see what I think is an unfortunate and tragic contradiction in policy between the former Conservative government and the speech of the Leader of the Opposition today. Here we have two basic contradictions. The right hon. gentleman attacks the legislation because of the exemption of Time and Reader's Digest, yet he provided these exemptions in his own legislation. He also attacks the principle of the legislation because it is a limitation on freedom; yet he evolved that very principle when he himself brought in legislation with respect to periodicals. He now denies the main, central theme of the report of the O'Leary Commission, a Commission set up, as I say, by his Government and which reported to his Gov-
June 15, 1965	COMMONS
emment. So that the Leader of the Opposition is clearly wrong when he states that the O'Leary Commission did not recommend Canadian ownership of our daily newspapers.
Another, more disturbing facet of the speech of the right hon. gentleman is that it seems to be contrary to the impression he himself created throughout the country. In 1957 and 1958 he was supposed to be a leader who was going to preserve our Canadian identity. He was the one who espoused the cause of Canadian nationalism. He was the one who accused the former Liberal Government of that day of being too pro-American and not sufficiently concerned with the protection of Canadian rights. Yet in this speech he goes against the very grain of that position with which he has always endeavoured to identify himself; Canadian identity. In his speech he has denied the necessity for the protection of our Canadian newspapers as far as Canadian ownership is concerned.


Marcel Joseph Aimé Lambert: Six o'clock.


John Carr Munro: This makes me realize the inconsistencies in the views of the Leader of the Opposition set out in a recent book which was written.


Lucien Lamoureux: Order. It being six o'clock it is my duty to leave the Chair so that the House may proceed with the consideration of private Members' business.


PROCEEDINGS ON ADJOURNMENT MOTION
Mr. Deputy Speaker:: Order. It is my duty pursuant to provisional Standing Order 39A to inform the House that the questions to be raised at ten o'clock this day are as follows: 1. The hon. Member for Winnipeg North- health and welfare, treatment by doctor of narcotics addict; 2. the hon. Member for Danforth-administration of justice-review of Criminal Code provisions respecting bail; 3. the hon. Member for Winnipeg North Centre-health and welfare-medicare-request for announcement of plan.
[DOT] (6:00 p.m.)
It being six o'clock the House will now proceed to the consideration of private Members' business as listed on today's order paper, namely, private bills, public bills.
DEBATES	2439
Private Bills PRIVATE BILLS


Marcel Joseph Aimé Lambert: the second reading of Bill No. S-9, to incorporate Principal Life Insurance Company of Canada.

He said: Mr. Speaker, the object of Bill S-9 is to incorporate Principal Life Insurance Company of Canada.
The bill originated in the Senate, where it was passed on May 27, after the Banking and Commerce Committee of the Senate had heard witnesses and studied the measure.
I must say, Mr. Speaker, that this proposal to incorporate Principal Life Insurance Company of Canada implements a petition from a group of men from the business and financial community of the City of Edmonton, known as the Collective Group.

The petitioners, Mr. Speaker, as indicated in clause 1 of the bill, are a group of Edmonton businessmen well experienced in the field of finance, retirement and savings plans and insurance. Their experience in this field extends back to 1954. The fact that they are coming to the Parliament of Canada for the incorporation of this insurance company, which will form part of the group known as the collective group, is additional evidence of the very buoyant and burgeoning economy of western Canada. I must say that this is the case not only in the Province of Alberta but also in British Columbia, and there are indications that it applies to other parts of Canada.
If we look at the financial history and economic development of our neighbours to the south, we will see that the corresponding region of their country did not really go forward until they had a nucleus or network of their own financial institutions. I think the progress in Canada is a clear indication of the necessity not only for financial institutions based in Central Canada but also for those operating in western Canada on a branch plan basis. In this regard I might indicate that in the last session of the Provincial Legislature of Alberta seven life and trust companies were incorporated for operation in that province. However, the matter in hand, the incorporation of Principal Life Insurance Company of Canada, comes to the other place and to this House because this company intends, although it wishes to

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Private Bills
operate primarily in its first years in Western Canada, to operate throughout the country and even on an international plane.
From the examination of insurance legislation in the past we know that the Government of Canada is tightening up its requirements with regard to capitalization and surplus. The Federal requirement is $500,000 of capital and $500,000 of surplus. In Alberta the requirement is somewhat less but it will be brought up to $750,000 in total by the end of the year. Under Bill S-9 this company is to be incorporated with a capitalization of $1 million, and may I say that no appeal to the public will be made for the sale of its stock.
I invite approval of the bill on second reading and then examination in detail before the Committee on Finance, Trade and Economic Affairs of those witnesses that the committee may wish to examine. The capital requirement for this company is not going to be sought from the public. Already the collective group has set aside $1 million from its reserves for the capitalization of this company.
To deal with the history of the collective group briefly, Mr. Speaker, may I say that during the early years of the operations of the company the collective group expects to concentrate its efforts on the development of Principal Life Insurance Company of Canada in the western provinces. Eventually it is hoped that the company will do business throughout the whole of the country. It already has within its own network 36 offices in Canada and two in the United States, the collective group having had certain companies organized and approved under the appropriate law in the United States. It also has the necessary personnel.
Let us look at some features of this group. First of all, what is the management team? This group, in operation for about 11 years, has shown itself to be quite a successful one. Its assets have increased more than 2,400 per cent since 1956 and in fact they amount to some $56 million according to its 1964 balance sheet. In eight years the number of holders of the group's investment contracts has risen from 4,700 to more than 63,000. The group has its own selling, administrative and investment divisions. So far as the selling of insurance is concerned, this is done through its direct sales force operating out of its various regional offices. May I say that this group was the first to introduce a massive computer into western Canada. It was the first to bring

in an I.B.M. system 360 computer. It has a staff of 400.
I do not want to appear to be boasting, but this particular group has also been operating under the Canadian and British Insurance Companies Act for over 11 years. Therefore they have full knowledge of the insurance and trust business and of portfolio administration. Of its 75 head office employees, 31 are university graduates and all of the senior personnel in the accounting department are chartered accountants.
May I say that I heartily endorse the organization of this company. The petitioners are listed in clause 1 of the bill. They are Donald M. Cormie, a practising barrister and head of this financial group, Ralph Perrin Forster, a man of long experience in financial areas, V. R. Stewart, a member of the management group, John W. Kennedy, a solicitor, Kenneth Marlin, a business executive, and Lynn A. Patrick, a solicitor and active counsel for the Principal Life Insurance Company.
[DOT] (6:10 pjn.)
It is instructive to note what this group has done in so far as the generation of savings is concerned as compared with other life insurance companies. The savings generated in the Province of Alberta by the collective group in 1964 amounted to $7,379,000. Now, the Sun Life was next with some $5,958,000; Prudential, $3,296,000; Manufacturers Life $3,077,000; Great West Life $2,487,000; Confederation Life had something like $1,336,000. Some Members may say that this represents a lot of money going into life insurance within the Province. However, it is a matter of statistical record that notwithstanding the fact we have a lot of insurance companies in Canada, and more are being incorporated, only 25 per cent of the population of Canada is covered by life insurance. There is, therefore, a great market in Canada for life insurance, for the accumulation of savings and for the placement or investment of those savings funds in the development of Western Canada.
I am sure hon. Members from Western Canada will share my view that moneys made available are then invested by Western Canadian businessmen who are aware of conditions there. I would say the same thing of the Maritime Provinces, British Columbia and the Central Provinces. I do not believe it is necessary to say that Boards of Directors concentrated in Toronto and Montreal necessarily have the best appreciation of the investment opportunities in other parts of the country. Therefore, Mr. Speaker, I invite all
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Private Bills
hon. Members to give second reading to this bill so that it may go to committee and we can examine witnesses there.


Horace Andrew (Bud) Olson: Mr. Speaker, I rise to give wholehearted support to the request of the hon. Member for Edmonton West (Mr. Lambert) that this bill be referred to the committee on Finance, Trade and Economic Affairs. I should like also to give full support to his statement that the economies of Alberta and British Columbia are buoyant and that it is the natural outgrowth of these expanding and buoyant economies that financial institutions of this kind come into existence. It is a fact also that financial institutions of this kind and other types assist in further expanding the economies of these areas.
I find it rather strange, however, that it is only on rare occasions we can get the hon. Member for Edmonton West and other Progressive Conservative Members to pay this kind of tribute to the Provinces of Alberta and British Columbia. Usually they have some very severe criticisms of these two Provinces. Sometimes I suspect this is mostly because there are Social Credit Governments in both of them. Nevertheless the fact is that the economies of these two Provinces have expanded faster during the past few years than those of any other part of Canada. It is natural that financial institutions should desire and attempt to set up there. We know it may be only a coincidence, but we think there has been some deliberate action and that it is because of these Social Credit Governments out there that the tremendous expansion has taken place.
We hope that there is not going to be some kind of Federal action that will inhibit this expansion. I have received a telegram today from the City of Medicine Hat which had prospects for some new industries establishing there. However, as a result of the designated or so-called development areas announced by the Federal Government, some of these industries are taking a second look at it, especially in view of the inducements and incentives offered by the Federal Government in this other legislation. I know that this might not be the right place to advance this kind of argument. However, I do feel strongly that we do not wish to have discriminatory legislation that will result in having misplaced industries. Surely it is not the purpose of the Federal Government to penalize those areas that have been expanding, and actually hold them back by legislation that makes it difficult for an industry to establish in these fast growing parts of Canada.
I do not want to say more about it, except that we welcome the opportunity to support this kind of financial institution. We hope there will be a change in the attitude of the Government so that we can have the Bank of British Columbia established in Western Canada for the purpose of assisting the expansion of the economy out there as well. We hope that there will be some change of attitude so that this expansion can be helped rather than hindered at this particular time.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the Standing Committee on Finance, Trade and Economic Affairs.
[Stage Direction]
The House resumed from Tuesday, June 1, consideration of the motion of Mrs. Konantz for the second reading of Bill No. C-99, to incorporate Bank of Western Canada, and on the proposed amendment thereto of Mr. Laprise.
Mr. Jack Davis (Parliamentary Secretary to Prime Minister):: The few remarks which I have to make tonight are my own and stated as a private Member. I want to say a few words about our banking system. I want to advocate the incorporation of more banks in Canada. More specifically, I want to advocate the incorporation of banks such as the Laurentide Bank and the Bank of Western Canada which we are discussing today. For these reasons, I am opposed to the amendment presented to the House which would affect the incorporation of the Bank of Western Canada by giving the bill a six months hoist. I am opposed to that. I believe that we should deal with this matter. I am referring to the incorporation of the Bank of Western Canada by sending the bill to the appropriate committee of this House in order that it may be considered on its merits. I hope this will happen, too, in respect of the Laurentide Bank.
Now, in approaching this matter of banking, I should like to explain my own position clearly. I should like to say, quite forthrightly, and I think this is agreed to by many other Members in this House, that I am a Canadian first and I am a British Columbian second. I am sure all hon. Members would put the nation before their Province in all cases. This is one of the main reasons I am opposed to the incorporation of banks which are owned by Provinces. It is for this reason

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I draw a distinction between privately owned banks such as the Laurentide Bank and the Bank of Western Canada and the proposed Bank of British Columbia which, in this instance at least, would be partially controlled by the Government of British Columbia.
[DOT] (6:20 p.m.)
I believe as a second principle we should have less government rather than more government. Whenever we have a choice we should have one level of government involved in the regulation of an activity, rather than several levels of government. For this reason I believe that as money and banking are specifically reserved, under the B.N.A. Act, to the Government of Canada, no attempt should be made to bring the provinces into the business of banking.
The B.N.A. Act is quite clear on this matter. Section 91 reads as follows:
-the exclusive Legislative Authority of the Parliament of Canada extends to all matters coming within the Classes of Subjects next hereinafter enumerated; that is to say-
15.	Banking, Incorporation of Banks, and the Issue of Paper Money.
16.	Savings Banks.
It goes on further to say:
Any Matter coming within any of the Classes of Subjects enumerated in this Section shall not be deemed to come within the Class of Matters of a local or private Nature comprised in the Enumeration of the Classes of the Subjects by this Act assigned exclusively to the Legislatures of the Provinces.
In other words, banking, the incorporation of banks, the issuance of paper money and savings banks are matters under the jurisdiction of the nation.
I am sure no Canadian would really want to see different coloured dollar bills in our provinces. In other words, to have a nation we must have one monetary system, and to have an effective monetary system we should have one central bank and chartered banks run by private enterprise which are clearly subject to the laws of Canada. To me that is an effective banking system.
Several hon. Members have referred to the prosperity of Western Canada. B.C. is very prosperous, and so is Alberta, but I do not attribute this entirely to the provincial governments. I attribute it partly to the genius of the people who live there and to the great resources of that part of Canada. In fact, I think the natural advantages of Western Canada far outweigh the natural advantages of the rest of Canada and this is one reason why now, and on into the future, Western Canada will be more prosperous than the

rest of the nation. I do not attribute this to any government, and certainly not to any individual political party.
I wish to refer briefly to what the Minister of Finance (Mr. Gordon) had to say in respect to the incorporation of banks. He underlined the fact that the B.N.A. Act clearly assigns to this Parliament exclusive jurisdiction over banking and the incorporation of banks, and he went on to say:
Even a limited ownership of shares of a bank by another government, whether it be a foreign government or a provincial government, could place such a government in a special position of power or influence in relation to that bank.
Such a situation might lead to differences of opinion between this government and another government, and to confusion over who exercises authority in regard to the bank.
This is crucial, and this authority must be clearly identified. It must be clearly identified as the national authority.
The principal argument used by the province of British Columbia is that provinces have control over property and civil rights; that shares in any enterprise are property, and hence a province can have control over bank shares, and can properly buy a controlling interest in a bank.
I suggest that provincial governments do not have all the powers of a private individual. Also their concern is with property and civil rights within a province, and not extending beyond the province. Certainly banking, in the manner that the bank of B.C. would be incorporated, does extend beyond one province, in this case from B.C. to other provinces, and beyond our Canadian provinces to other countries in the world. In other words, it extends into an area which is clearly one of federal jurisdiction.
I believe we need more banks. Certainly the Porter Royal Commission indicates this. We need more competition in respect to the lending of money. This will drive interest rates down and make money readily available. In the 1880's we had 30 to 40 banks. Today we have eight. We have five which are entirely national, two confined to Quebec but operating under federal law, and one which has branches in Montreal, Toronto and Vancouver.
We need more banks in the West. We also need bank headquarters in the West because of our economic prospects and because of the growing financial power of Western Canada. The government of B.C. made a very interesting submission to the other place. It indicated that today the economy of B.C. alone is greater than that of the Atlantic region. Our
June 15, 1965

population is comparable. The turnover in respect of money is substantially greater. Some of the figures are illuminating. For example, labour income in B.C. is 55 per cent greater than that of all the Atlantic provinces combined. Cheques cashed are nearly two and a half times as great as in the Atlantic region.
If one thinks not merely of B.C. but also of the Prairies having an economy half again as large as that of B.C., he knows we are dealing not only with a growing region but a very important one in economic terms. In population terms it challenges Quebec, and in economic terms it is comparable to Ontario. It is the most rapidly growing and most vital part of Canada, and needs not only more branch offices but bank headquarters as well.
The government of B.C. is fond of indicating that the Bank of America, the biggest bank in the world, has its headquarters in California. It does not, however, say that the Bank of America is owned or was initiated by the State of California. It is a private bank operating under the laws of the United States and is part of the U.S. federal reserve system. It is totally responsible to the laws of our neighbouring nation to the south. It is not akin to a provincial bank. It is not a state bank; it is a privately owned bank.
Numerous other reasons are given by the government of B.C. as to why there should be a Bank of B.C. Our friends in the Credi-tiste party are blocking the incorporation of other private banks in order to bring the Bank of B.C. forward but, if they will allow me, I will destroy the remaining arguments advanced for a provincial Bank of B.C. One argument is that it would assist in making Vancouver a centre of Canadian finance. If the Laurentide Bank were incorporated it would help us to attain that objective.
Another argument they advance is that a chartered bank must succeed. Since when have chartered banks in Canada not succeeded? We have not had a significant bank failure, nothing like the failures in the United States, even in the depression years of the 1930's.
A third argument is that the bank should be concerned primarily with B.C. I suggest that all banking institutions are concerned about making money, are concerned about investing in going concerns in whatever part of Canada they do business. Therefore that qualification would certainly be met by banks like the Laurentide Bank and the Bank of Western Canada.
Private Bills
They also argue that bank shares should have a relatively stable market value. Most of our Canadian bank shares, because of the solvency of our banks under a very fine banking system, have that stability.
[DOT] (6:30 p.m.)
They also suggest that the provincial government can be of practical assistance to a bank. I suggest that the Government of British Columbia will be putting its surplus funds, tax revenues and income from other sources into the Bank of British Columbia exclusively.
Finally, the problem of professional management would be met. Canada's chartered and other banks have been very well managed and I suggest the Bank of British Columbia would be recruiting most of its management from the staff of the chartered banks. Therefore this argument of a lack of professional management falls to the ground.
I should like to refer briefly to the nature of the directorate of the proposed Bank of British Columbia. The gentleman proposed as president is Mr. Einar Gunderson, senior partner of the accounting firm of Gunderson, Stokes, Walton & Company. He is among other things chief fund-raiser for the Social Credit Party in the Province of British Columbia. He is also the executive vice president and a director of the Pacific Great Eastern Railway, a British Columbia socialistic enterprise. He is executive director of the British Columbia Hydro and Power Authority, another Government-owned agency. And he is a member of the British Columbia Ferry Authority. He is one of the principal confidants, if not the closest personal friend, of the Premier of British Columbia. The claim that this would not be a politically influenced bank falls to the ground because of the personalities involved, certainly that of Mr. Gunderson. This is the man who recently stated that, for more than a decade he had been raising money for the Social Credit party's election campaigns purposes. He has been raising it in the name of the British Columbia Free Enterprise Education Fund. Mr. Gunderson is, of course, an officer of a number of socialistic enterprises and some of these have been socialized within a relatively short period of time. He personally played a major role in bringing them under Government ownership.
Now I should like to consider the scale and scope of the proposed bank. This Bank of British Columbia would have a capitalization of $100 million, that is to say, of the same order of magnitude as the Toronto-Dominion Bank. In order to be profitable it will have to attract

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Private Bills
all of the savings of all individuals, all firms and all institutions in the province, besides those of all the Crown corporations-and then some. Were it to confine its activities exclusively to British Columbia there would be no room left for any private bank whatever. It would have the effect of driving free enterprise out of all banking in British Columbia, driven out by the man who is proposed as President of this Bank, the person who has been soliciting contributions in the name of the British Columbia Free Enterprise Education Fund. In my view, those who have been contributing to this fund have actually been contributing to the downfall of private enterprise in several important areas, one of the most significant of them being commercial banking in Canada.
What would happen if Quebec were to decide to follow this example, as is entirely likely? Eventually we might have as many as ten provinces taking an equity interest in chartered banks whose policies they would influence or control. Private enterprise would be wiped off the map in Canada in this field. The Bank of Canada would remain the agent of the Federal Government but it would have to deal with ten separate provincial banks. We could not look forward to a continuance of informal discussions held once a month or more frequently between the central bank and the various chartered banks. Instead we would be committed to a series of Federal-Provincial Conferences bearing on monetary policy. Imagine what might happen if inflation began to get under way and the Federal Government decided to pursue a tight money policy. The Province of British Columbia might resist such a policy as being against the interests of many of the people in that province. So there would be a dillying and dallying between two different levels of Government. Federal-Provincial conferences perform a useful function but I doubt whether they could be effective in managing the monetary policy of this country. I can imagine the Premier of British Columbia saying, for instance: I will go along a little distance with this tight money policy if you will turn over your offshore mineral rights to the province; instead of bringing this issue before the courts we shall have it out around the table during this so-called conference on monetary policy.
What view would other countries take of this monetary Balkanization of Canada? England has one of the most successful banking systems in the world. It has a national bank and a number of private banks subject to the

law of the United Kingdom. A Labour Government was in power in the United Kingdom for a number of years but it did not see fit to permit the Balkanization of its banking system. I suggest to Members of the New Democratic Party that their endorsement of the Bank of British Columbia renders their ideas for planning on a national basis nonsensical.


Mr. Deputy Speaker:: Order. I have to interrupt the hon. Member, whose time has expired, unless he has unanimous consent to continue.


Some hon. Members:: Agreed.


John (Jack) Davis: This is important. The New Democratic Party wants to plan our way of life more effectively. It says the Government should move into more areas of economic activity. I can think of no activity more essential to economic planning than the formulation of monetary policy, and I cannot imagine that a national Government headed by the hon. Member for Burnaby-Coquitlam (Mr. Douglas) would look with favour on ten provincial premiers coming to the bargaining table, each with a particular banking policy, each with ideas as to whether there should be tight money or easy money, ideas as to how credit should be advanced, and so on.
As one who endorses the free enterprise system I firmly believe we need a monetary policy with only one set of rules and only one level of Government involved. This Parliament should establish the ground rules upon which banks should operate right across the country-a system flexible enough to meet all our needs as they arise. This would give mobility to industry and develop the economy to an increasing extent for the benefit of all Canadians. National unity alone requires that the setting up of provincial banks should not be entertained by this Parliament and that this proposal to establish a Bank of British Columbia should, in particular, be rebuffed. On the other hand, private banks, including the Bank of Western Canada, should be incorporated in order to make our present system more flexible and more effective.
[DOT] (6:40 p.m.)


Horace Andrew (Bud) Olson: Mr. Speaker, does the hon. Member think the proposed Bank of British Columbia operating under the Federal Bank Act would be either contrary or detrimental to the national interest?


John (Jack) Davis: The short answer to that question is, I think it would be detrimental to the national interest.
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Private Bills


An hon. Member:: Why?


John (Jack) Davis: A longer answer to the question is that there are certain latitudes permitted to chartered banks, observing the law in its strictest form, and within those latitudes, if all chartered banks owned by provinces were to throw their weight one way, it would make it very difficult to put any particular policy into effect.


Horace Andrew (Bud) Olson: I have a supplementary question. Is that true of the present shareholders of banks? Are they able to frustrate federal policy by exercising the power they have as a result of the shares they own at the present time?


John (Jack) Davis: I suggest that there is a great variety of interests among the shareholders of our different banks and that this variey of interests reflects the national interest to a considerable extent, and that to the extent it does not reflect national interest it allows the will of the majority to prevail.


John (Jack) Henry Horner: Mr. Speaker, I have been very interested in listening to the speech of the hon. Member for Coast-Capi-lano. I am sure he has assisted the Social Crediters and the Creditistes in their marathon talk-out of any proposed bank charter.
The hon. Member's speech dealt with a great many things other than the application for charter of the Bank of Western Canada, in respect of which some of us are particularly interested. The hon. Member complained that the control of the British Columbia Bank might lie in the hands of a few, and that its power might be directed in certain ways at the whim of a political party or of a few individuals.
The hon. Member never once tried to defend the application for charter of the Western Canada Bank.


An hon. Member:: Yes he did.


John (Jack) Henry Horner: Someone suggested that he did. I read the remarks made by the mover of this bill, and she at no time, in moving first or second reading, refuted some of the charges made before the Banking and Commerce Committee of the Senate of 1964. I intend to refer to those hearings in greater detail later on.
If the hon. Member for Coast-Capilano has no objection to the granting of a charter for the Bank of Western Canada I do not understand why he objects so strenuously at this time. Let us be very clear at this time that a very few powerful people will have control
of the proposed bank, and that those people are not people resident in Western Canada. That being the case, what is the difference in respect of the application for the charter of the Bank of British Columbia?
When the Premier of the Province of British Columbia appeared before the Senate Committee, and I have the report of that committee in my hands, although I will not have time to read the relative portions, he stated he would be agreeable to reducing his interest to 5 per cent or 10 per cent. In view of that fact what is the difference in the attitude taken by the Government in respect of these applications for charters?
As a result of a rigid cross-examination by a member of the other place the information was revealed that 49 per cent of the stock of the proposed Bank of Western Canada, at least under the terms that existed in respect of the application last year, would be held by three people. We have now heard an ardent spokesman for the Government say that it would be a terrible crime to give a charter to a bank, only a fraction of the shares of which would be held by the Premier of the Provincial Government, who wishes to develop these vast resources of his Province and who takes it upon himself as a responsibility to develop those resources for the benefit of the people of that Province. On the other hand, we hear the same spokesman and other Members of his party avidly supporting an application for a charter of a bank which supposedly wishes to develop Western Canada but which in fact will benefit very few more than three individuals. After listening to the speech of the hon. Member I am afraid that the hon. Member has more than convinced me, and perhaps this is the first time, that the sponsors of the Bank of British Columbia should expect, as a right, to receive a charter.
The hon. Member for Coast-Capilano has not convinced me that the charter requested by the bill now before us should be granted, and I shall point out in the time available to me why I am not convinced. Perhaps at some stage the mover and those people who ardently speak in favour of this bill will present some sound arguments for this application for a charter, rather than spend their time condemning another application.
The mover of the bill pointed out, as recorded at page 1260 of Hansard, that the capitalization of the new bank is to be increased and that 4,720 certificate holders are from western Provinces, whereas 830 are

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from outside that area. Let us compare that picture with the picture shown in respect of the application for a charter now before us as presented during the last session to the Banking and Commerce Committee of the other place.
At page 58 of the proceedings of that committee the witness, Mr. Stevens, who appeared on behalf of the applicants, is recorded as having stated that the total number of shareholders would be 6,099 and of that number only 233 were not residents of the Western Provinces. That would indicate to me that the number of shareholders does not necessarily designate where the control lies. In the present application there are fewer shareholders, but a greater number of them who are resident in areas other than Western Canada. Of the proposed 6,099 shareholders only 233 are from outside of Western Canada; but what control would those 233 shareholders have? That is the point of interest to us. It is my feeling that they would have the greater control, and this is supported by the evidence of Mr. Stevens as reported at page 59 of the same proceedings of that committee, which met on May 6, 1964.
At page 60 of the proceedings, in reply to a question, Mr. Stevens stated that the group of companies involved are The Wellington Finance Corporation, Limited, Canadian Finance & Investments Ltd., and York Trust and Savings Corporation. After rigorous examination it was discovered that the York Trust Company would hold 33,000 shares, that the Canadian Finance Company would hold $2,250,000, or 150,000 shares of the proposed capitalization, and that the Wellington Finance Corporation would hold $3,750,000 or 433,000 shares of the capitalization. In other words 43 per cent of the capital of that proposed bank would be held by those three companies, and that is only part of the picture.
Under the proposed Bank Act no individual, person or party shall own more than 10 per cent of the shares of any proposed chartered bank. I believe that the holding of a bank charter is a right of Canadians generally and that this Government or Parliament should not interfere with that right. I believe that the base of any bank charter should be spread as broadly as possible, rather than being narrowly confined as would be the case in respect of this application for a charter for the Bank of Western Canada.
Mr. Speaker, nothing has led me to believe that there is any great change in this

application from that which was presented earlier. I do not suggest there are not any changes, because obviously there have been some, but let me attempt to show that it does not matter where the shares are, but that what is important is where the capital and voting rights lie. Forty three per cent of the capital of the new bank is to be held by three companies, as indicated by the evidence given before the Banking and Commerce Committee of the other place on May 6, 1964, as recorded at page 60 of the proceedings of that committee.
[DOT] (6:50 p.m.)
Further we find that British International owns 40 per cent of York Trust, and that it has voting power to the extent of 28.9 per cent in Canadian Finance. It also has 36.6 per cent holding interest in Wellington. There seemed to be some doubt about the figure in the questioning; one of the examiners thought it was 48 per cent but the witness said it was 36.6 per cent. That appears at page 61 of the committee proceedings. So 36.6 is the minimum holding. It appears that 43 per cent of the capital of the new bank would be held by these three companies; and one of them holds practically a controlling interest in all three.
A little further on in the proceedings we discover that British International Finance of Canada is controlled, as admitted by Mr. Stevens, by Mr. Stevens and his family and Mr. W. E. N. Bell. As reported at page 62 of the report he says:
I would like to emphasize the indirect nature of that, though. For example, X would have a 49 per cent interest in one company-
There are three other shareholders, but it is not fair to suggest that a 49 per cent interest does not in fact control a company. Certainly we are not naive enough to believe that anyone with a 49 per cent holding in a company does not, in effect, control it.
I do not want to read extensively from the proceedings, but as reported at page 63 Mr. Stevens quite frankly admits:
To save any misunderstanding there-I am trying to be correct in my statement-I will say that the next largest holder would be William J. Mollard. He appears in the prospectus. I am trying to be correct as to whether myself plus Bell plus Mollard control-those three certainly control.
Senator McCutcheon: Then I think the answer to my question follows from that, that you and Mr. Mollard and Mr. Bell are in a position to sell the control of British International Finance-
He points out that the three people who control British International Finance would be, in effect, the three people who are the
June 15, 1965



principal shareholders of the controlling interest in the new bank applying for a charter. He also pointed out under examination that these three people could quite conceivably sell their shares to other persons or to another person, so that you could have a controlling interest in this proposed Western Canada Bank in the hands of one company.
I must say I have been looking for something to set my fears at rest. I looked for something from the mover when she moved second reading of the bill and from the ardent spokesman who favoured so vehemently the Western Canada Bank, rather than the bank sponsored by the Province of British Columbia. But I heard and saw little to set my fears at rest. However, I notice that the capitalization of the proposed bank is now larger than it was last session. I may be of a suspicious nature, Mr. Speaker, but three men went before the other place in the last session of Parliament and asked for a charter. There are only eight charters in Canada. These three individuals want the ninth. Therefore, why should we in this Parliament not suspect that they would come back in this session masquerading under the name of the Western Canada Bank? There was quite a few years ago a Western Canada Bank. As the hon. Member for Coast-Capi-lano (Mr. Davis) said in his speech, he did not believe for one moment that chartered banks ever lose money, and I would agree with him on that. But for some reason or other they do sell and they do amalgamate. I do not think for one moment, when the old Bank of Western Canada, so named, eventually amalgamated with the Standard Bank and the Standard Bank amalgamated with the Bank of Commerce, that in any one of those transactions the parties or persons concerned lost a nickel. Therefore I think it is the duty of Members of Parliament and those in the other place very carefully to examine the application for this charter, and whether or not the charter will be placed into the controlling hands of a few. They should investigate whether or not these people intend to carry out the declared operations of this proposed bank.


John (Jack) Davis: Could I ask the hon. Member a question. The hon. Member in his speech has been asking for information throughout. Surely the best way to get information is to put this bill before a committee of the House and summon witnesses. He himself can attend and ask all the questions he likes and get the facts. Why do we not proceed in this manner?
Income Tax Act


John (Jack) Henry Horner: I have no doubt whatever that this bill will get before the committee, but I have some doubt whether I would be on the committee because the proposed Government changes have narrowed down our committees system to a dangerous point. Therefore I think it only fair that the questions in my mind today should be put on paper for those who sponsor the bank to read, and so witnesses coming before the committee at a later date can bring the answers and set my fears at rest. Whether or not I am on the committee I will read the evidence given before the committee; and I firmly believe that if the hon. Member who just interrupted me was avidly concerned about and interested in getting this bill through Parliament this evening, then he had no business running wild during his time, taking five extra minutes, condemning another bank instead of speaking in support of the promotion of this bank. He now suggests that because 1 have asked a number of questions I am talking out the bill. I suppose that is what he tried to suggest by his polite little question to me. I must inform you, Mr. Speaker, and through you, him, and the mover of the bill, that I have many more questions yet and I am not through.


Mr. Deputy Speaker:: Order. I must inform the hon. Member that it is seven o'clock and that the time allocated for private Members' business has now expired. The House will now resume the business interrupted at six o'clock.



[Stage Direction]
The House in Committee of Ways and Means, Mr. Lamoureux in the Chair.

[Stage Direction]
Resolved, that it is expedient to introduce a measure to amend the Income Tax Act and related provisions of the Federal-Provincial Fiscal Arrangements Act and to provide among other things:
1.	That for the 1966 and subsequent taxation years the income tax payable by an individual be reduced by an amount equal to the lesser of 10 per cent of basic tax or $600 and for the 1965 taxation year by an amount equal to the lesser of 5 per cent of basic tax or $300.
2.	That for the 1965 and subsequent taxation years a taxpayer may deduct in computing his taxable income an amount for the support of a person who was his niece or nephew and who during the year resided in Canada, was wholly dependant upon him for support, and was
(a)	under 21 years of age,
(b)	21 years of age or over and dependant by reason of mental or physical infirmity, or
(c)	21 years of age or over and in full-time attendance at a school or university,
if
[Stage Direction]
June 15, 1965
Income Tax Act
(d)	the mother of the niece or nephew was divorced or separated and not in receipt of alimony or similar payments, or
(e)	the father of the niece or nephew was deceased or mentally or physically infirm,
not exceeding $300 if the person was a child qualified for family allowance and $550 if he was not so qualified.
3.	That for the 1965 and subsequent taxation years a taxpayer may deduct in computing his taxable income an amount not exceeding $550 expended by him during the year for the support of a person who was his aunt or uncle and who during the year resided in Canada and was dependant upon him for support by reason of mental or physical infirmity.
4.	That for the 1970 and subsequent taxation years the additional exemption of $500 now allowed to a taxpayer who has attained the age of 65 years be allowed only if the taxpayer has attained the age of 70 years and that for the taxation years 1966 to 1969 inclusive a taxpayer who has attained the age of 65 years but has not attained the age of 70 years be allowed the additional exemption of $500 only if he did not receive a pension under the Old Age Security Act in respect of any month in that year.
5.	That for the 1965 and subsequent taxation years a taxpayer who deducts in computing his income from an office or employment
(a)	annual dues to maintain membership in a trade union or to maintain membership in an association of public servants,
(b)	annual dues retained from his remuneration pursuant to the provisions of a collective agreement and paid to a trade union or association, or
(c)	annual professional membership dues the payment of which was necessary to maintain a professional status recognized by statute,
shall not by reason of such deduction be ineligible to deduct the standard deduction of $100 described in paragraph (ca) subsection (1) of section 27 of the Act.
6.	That for the 1966 and subsequent taxation years a person, the spouse of such person residing with him and previously resident in Canada, or any dependant child of such person, shall be deemed to have been resident in Canada throughout a taxation year if such person was at any time in the year performing services in a country other than Canada under a prescribed international development assistance program of the Government of Canada, and was resident in Canada during a part of the year preceding the commencement of such services.
7.	That for the 1966 and subsequent taxation years a contribution made by a person under the Canada Pension Plan or under a provincial pension plan as defined in section 3 of the Canada Pension Plan may be deducted in computing the income of such person.
8.	That for the 1965 and subsequent taxation years the limitation on the amount related to earned income that a taxpayer may deduct as a premium under a registered retirement savings plan be increased from 10 per cent of earned income to 20 per cent of earned income.
9.	That for the 1965 and subsequent taxation years such part of any amount that would otherwise be included in computing income of a taxpayer as a retiring allowance be deductible if it is paid in the year, or within 60 days after the end of the year, as a contribution to a registered pension fund or plan, as a premium under a retirement savings

plan, or to a trustee under a deferred profit sharing plan.
10.	That there may be deducted in computing the income of a taxpayer an amount in respect of an outlay or expense made by the taxpayer in the 1965 and subsequent taxation years
(a)	to a person with whom the taxpayer is dealing at arms length and who is the lessee of property owned by the taxpayer, to obtain the cancellation of a lease on such property,
(b)	for landscaping property used by the taxpayer for the purpose of gaining or producing income,
(c)	for clearing land or laying tile drainage for the purpose of carrying on a farming business,
(d)	as or on account of the cost of making representations to a government, municipality or other public authority in connection with a business carried on by the taxpayer, including representations for the purpose of obtaining a licence, permit, franchise or trademark,
(e)	as or on account of the cost incurred in investigating the suitability of a site for a building or other structure planned by the taxpayer for use in connection with a business carried on by him.
11.	That for the 1965 and subsequent taxation years a corporation shall be deemed to be resident in Canada throughout a taxation year if
(a)	it was incorporated in Canada before April 27, 1965 and was resident in Canada in its taxation year that included April 26, 1965 or in any subsequent on taxation year, or
(b)	it was incorporated in Canada after April 26, 1965.
12.	That with respect to payments received by a taxpayer after April 26, 1965, other than a payment made upon the death of an employee, the amount that a taxpayer may elect to have taxed under section 36 of the Act shall not exceed
(a)	in the case of a single payment
(i)	out of or pursuant to a superannuation or pension fund or plan, or
(ii)	pursuant to deferred profit sharing plan, or
(iii)	pursuant to an employee's profit sharing plan,
$1,500 times the number of years during which the employee, in respect of whom the payment was made, was a member of the plan, or
(b)	in the case of
(i)	a single payment upon retirement of an employee in recognition of long service, or
(ii)	a payment or payments made by an employer to an employee or former employee upon or after retirement in respect of loss of office or employment
$1,000 times the number of years during which the employee, in respect of whom the payment was made, was an employee of the employer who made the payment.
13.	That for taxation years commencing after April 26, 1965, a trust or estate (other than a trust or estate arising on death) that has income from a business carried on by it in Canada may not deduct in computing its income an amount paid or payable to a beneficiary who is
(a)	a non-resident of Canada,
(b)	a non-resident-owned investment corporation, or
(c)	another trust or estate resident in Canada, unless that other trust or estate
(i)	arose on a death, or
(ii)	has been since April 26, 1965 a beneficiary of the trust or estate paying the amount and the trust or estate paying the amount has been carrying on the business since April 26, 1965,
and any amount paid or payable out of the income for the year of the first-mentioned trust or estate
June 15, 1965
[Stage Direction]
will continue to be included in the income of its beneficiary notwithstanding the fact that the first-mentioned trust or estate was not entitled to deduct the amount in computing its income.
14.	That for the 1965 and subsequent taxation years the amount of income derived from a new mine that a corporation may exclude in computing its income shall be confined to income from the operation of the mine by the corporation.
15.	That where a joint exploration corporation acquires after April 26, 1965 a right, licence or privilege to explore for, drill for or take petroleum, natural gas or other related hydrocarbons, the cost of the right, licence or privilege may not be renounced to a shareholder corporation.
16.	That for the 1965 and subsequent taxation years an amount that a taxpayer may exclude from his income because it is consideration for a mining property acquired as the result of his efforts as a prospector, or as the result of efforts of a prospector who was employed or financially assisted by him, shall not include a share of profits, a royalty or a payment based on production.
17.	That the Minister of National Revenue with the approval of the Governor in Council may on behalf of the Government of Canada enter into an agreement with the government of a province, under which one government undertakes to transfer to the other, in respect of income tax paid by an individual from whom deductions were made at source as though he were resident in a place other than the province in which he was resident on the last day of the year, a part of the amount deducted or withheld under section 47 of the Act or a similar provision of a provincial income tax act.
18.	That in order to give effect to the provisions of paragraph 1 without reducing the amount of equalization payments to any province a consequential amendment be made to the Federal-Provincial Fiscal Arrangements Act to adjust the fractions set out therein in the definition of "standard individual income tax" used in the computation of equalization payments.
19.	That a new section be added to the Act concerning expenditures of a taxpayer for advertising space in a non-Canadian newspaper or periodical having effect substantially as follows:
"12A (1) In computing income, no deduction shall be made in respect of an otherwise deductible outlay or expense of a taxpayer for advertising space in an issue of a non-Canadian newspaper or periodical dated after December 31, 1965 for an advertisement directed primarily to a market in Canada.
(2)	An issue or edition of an issue of any newspaper or periodical that is edited in whole or in part in Canada and printed and published in Canada and that was not on April 26, 1965 a Canadian newspaper or periodical shall be deemed, for the purposes of subsection (1), not to be an issue of a non-Canadian newspaper or periodical if
(a)	through the period of twelve months ending April 26, 1965 issues or editions of issues of that publication were being edited in whole or in part in Canada and printed and published in Canada at the usual intervals for issues of that publication and have since that date continued to be so edited, printed and published without interruption except for a reason other than the cessation of the business of publishing that publication; and
(b)	in the case of a periodical, the periodical is similar, in content and in respect of the class of readers to whom it is directed, to the issues or editions of that periodical that were throughout
22620-156|
Income Tax Act
the period of twelve months ending April 26, 1965 being edited in whole or in part in Canada and printed and published in Canada.
(3)	Subsection (1) does not apply with respect to an advertisement in a special issue or edition of a newspaper that is edited in whole or in part and printed and published outside Canada if such special issue or edition is devoted to features or news related primarily to Canada and the publishers thereof publish such an issue or edition not more frequently than twice a year.
(4)	Subsection (1) does not apply with respect to an advertisement in
(a)	a catalogue, or
(b)	any publication the principal function of which is the encouragement, promotion or development of the fine arts, letters, scholarship or religion.
(5)	In this section,
(a)	'Canadian issue' means,
(i)	in relation to a newspaper, an issue, including a special issue,
(A)	the type of which, other than the type for advertisements or features, is set in Canada,
(B)	the whole of which, exclusive of any comics supplement, is printed in Canada,
(C)	that is edited in Canada by individuals resident in Canada, and
(D)	that is published in Canada, and
(ii)	in relation to a periodical, an issue, including a special issue,
(A)	the type of which, other than the type for advertisements, is set in Canada,
(B)	that is printed in Canada,
(C)	that is edited in Canada by individuals resident in Canada, and
(D)	that is published in Canada,
but does not include an issue of a periodical
(E)	that is produced or published under a license granted by a person who produces or publishes issues of a periodical that are printed, edited or published outside Canada, or
(F)	the contents of which, excluding advertisements, are substantially the same as the contents of an issue of a periodical, or the contents of one or more issues of one or more periodicals, that was or were printed, edited or published outside Canada.
(b)	'Canadian newspaper or periodical' means a newspaper or periodical the right to produce and publish issues of which belongs to or is vested in
(i)	a Canadian citizen,
(ii)	a partnership of which at least 5 of the members are Canadian citizens and in which interests representing in value at least 3 of the total value of the partnership property are owned by Canadian citizens,
(iii)	an association or society of which at least 3 of the members are Canadian citizens,
(iv)	Her Majesty in right of Canada or a province, or a municipality in Canada, or
(v)	a corporation
(A)	that is incorporated under the laws of Canada or a province,
(B)	of which the chairman or other presiding officer and at least 3 of the directors or other similar officers are Canadian citizens, and
(C)	of which, if it is a corporation having share capital, at least 3 of the shares having full voting rights under all circumstances, and shares representing in the aggregate at least 3 of the paid-up capital, are owned by Canadian citizens or bycorporations other than corporations controlled
[Stage Direction]
June 15. 1965
Income Tax Act
directly or indirectly by citizens or subjects of a country other than Canada; and
(c)	'issue of a non-Canadian newspaper or periodical' means an issue that is not a Canadian issue of a Canadian newspaper or periodical."
[DOT] (7:00 p.m.)
John Carr Munro: Mr. Chairman, prior to private Members' hour I was referring to the speech made by the Leader of the Opposition in which he indicated that this proposal involved some limitation of the freedom of the press. I was quoting from the O'Leary Commission report, a Commission which I would reiterate was set up during the administration of the right hon. gentleman, reporting to the Government of that day. As reported at the bottom of page 7 the Commission has this to say about the freedom of expression argument:
In our society, freedom of expression-and therefore of the organs of expression-is so firmly established as to require overwhelming justification of anything that might be construed as interference by the State. So sacred indeed is the freedom of expression-or freedom of the press, which is but a function of all freedoms-so essential is it to our way of life that its protection benefits from every doubt of State measures which concern it.
This Commission was not established to devise means of curtailing the freedom of expression, nor to fashion means to in any way limit press freedom. It has not conceived it to be its function to restrict opinion in any way. But this is not to say that venerable and sanctified cliches about "press freedom", shouted at the Commission through so many of its hearings, should deter it from a sincere accomplishment of its instructions and much less from an honest discharge of its duties to arrive at conclusions and make recommendations, whether or not they entail legislation. There is need to remember that freedom of the press is not an end in itself, but only a function of general intellectual freedom; to remember that no right includes a privilege to injure the society granting it; to understand that a great constitutional doctrine cannot be reduced to a mere business convenience, and that the press is but a Fourth Estate- not a whole community.
Leaving out a few lines, the report continues:
At the same time, however, it has viewed with distaste the sight of fundamental principles of democracy being sent to act as decoys in the interest of commerce.
I think that this amply demonstrates the point made by the Minister of Finance in his introductory remarks last evening when he stated that this proposal was in no way a limitation of the press, that it in no way was directed at any curtailment of the dissemination of information, but rather all that it did in effect was to limit the sale of newspapers by their owners to interested Canadian purchasers rather than to foreign or non-resident purchasers. In other words, it is a limitation

in the business area but it has nothing whatsoever to do with the dissemination of information or editorial policy or the position taken by newspapers so far as the free expression of ideas is concerned. As was also indicated by the hon. Member for Port Arthur, I cannot for the life of me see any validity in the argument that the proposal limits or is an invasion in the area of freedom of the press.
I should like to deal a little further with the O'Leary Commission report. An interesting thing is that the O'Leary Commission not only recommends the imposition of limitations on the periodical press in order to preserve their Canadian identity but even goes further and suggests that in the future we may have to think in terms of other legisla-ion of this type, though still not dealing in the area of dissemination of information, still not dealing in the area of editorial policy or the encouragement of conflict of opinion but, if you like, dealing in the business area, in the area of physical ownership. On page 8 of the report there is the heading "The National Interest", and this is the justification given by the Commission for the type of limitations which are proposed in this legislation. The justification is the national interest. In this regard the Commission said:
There is, after all, practically nothing a government can do without impinging upon the rights and privileges of some so that they may harmonize with those of others with which they may conflict. The constant redefinition of rights and privileges is the continuing task of government. That this process is difficult, there is no doubt. However, even in a matter as sacred as the freedom of expression limitations have been applied in the past: no publication has the right to libel.
There is one inherent limitation.
It is not inconceivable that new limitations may be necessary in the future, seeing that with the increased importance and mounting power of mass communications, there must be a corresponding gain in the power and importance of the relatively few people who control the media, and, therefore, a decrease in certain rights of other individuals in the community.
I take that as an indication by the O'Leary Commission of their concern over the degree of concentration of ownership in the whole mass media field. I take it as an indication of concern that has been expressed not only by the O'Leary Commission but by many others, because the degree of concentration of ownership in the mass media field, not only newspapers, has grown to an alarming extent in Canada. I suggest that in this particular paragraph the Commission foresees that maybe a somewhat similar type of development will have to occur in Canada, as took
June 15, 1965

place in England with the establishment of the Shawcross Commission, to go into the whole area of mass ownership in the media field because, as the O'Leary Commission has stated, "there must be a corresponding gain in the power and importance of the relatively few people who control the media and, therefore, a decrease in certain rights of other individuals in the community".
It has always been recognized as a fundamental function of any government in a free society that it must protect the rights of the individual, and if this concentration of ownership should occur to the degree that it diminishes the rights of the individual we can perhaps foresee legislation in this field also. So the principle of national interest is there. Our country and other countries in our democratic society have recognized that there is a fundamental duty to protect the individual against concentrations of power and to protect the national interest against foreign influences.
This is the justification for this legislation. This is the justification advanced by the Commission which formed the basis of the legislation as it was first introduced by the former Government. Therefore, for the former Prime Minister to indicate in the House today an attitude in direct conflict with and diametrically opposed to a bill his own government had on the order paper based on the recommendations of his own Commission is, to me, simply incomprehensible.
I think this also points out another interesting development in the political evolution of the ideas of the Leader of the Opposition. Professor George Grant has recently written a book entitled Lament for A Nation. There has been some discussion of this book in Canada. In it he has identified the Leader of the Opposition as a great nationalist, as one who was opposed to the power complex and pressure groups in Canada, as one who advocated that the Canadian identity must be preserved. It must be disillusioning indeed to his champion, Professor George Grant, who extolled the Leader of the Opposition to such heights, that now the Leader of the Opposition should today criticize and indicate his lack of support for this type of legislation. I think it would be interesting to refer to one portion of the book. As found on pages 16 and 17, Professor Grant states:
[DOT] (7:10 p.m.)
There is something naive about Diefenbaker's attacks on Toronto and Montreal business in the 1963 election, particularly in the light of the economic policies his government had pursued from
Income Tax Act
1958 to 1962. It is not surprising that the only literate and established voice on the side of Diefen-baker in the election of 1963 was Senator Grattan O'Leary, who was himself caught in the trap of romantic nationalism. Senator O'Leary also was a supporter of both nationalism and capitalism. He could presumably combine the two because he thought the leaders of Canadian capitalism after 1940 were still nationalists. There seems less excuse for such nonsense from the publisher of a great eastern newspaper than from a western lawyer. It is, nevertheless, startling that the western lawyer could still believe capitalists were nationalists after a term as Prime Minister. In short, Diefenbaker did not understand the economic implications of Canadian nationalism; he could not appraise the class structure realistically, and therefore he could not formulate the economic policies that were necessary if nationalism was to be more than rhetoric and romance. Even after his defeat, he does not seem to have learnt these lessons. As Leader of the Opposition, he attacked the measures, put forward by Walter Gordon to limit the control of this country by American capital.
Here we have it from this author, a great defender of Mr. Diefenbaker and his administration indicating his disillusionment with the inconsistencies and contradictions in the positions and postures taken by the Leader of the Opposition with regard to the policies advocated by the Minister of Finance last year and within the first year of our taking office. Again, we have an illustration of the Leader of the Opposition opposing such policies here today. It becomes somewhat of a tragedy that Canadians have learned to look to the Leader of the Opposition as the personification of the champion of preservation of the Canadian identity, and yet today we have opposition to legislation that I would suggest goes to the very heart of any real effort to preserve any type of Canadian identity at all.
Surely, Mr. Chairman, we must concede that in the ownership of newspapers we have a very essential element of the whole mass media field. When we concede that we have the whole field of the mass media involved, then we are talking about one of the fundamental areas of ownership in our whole way of life. If we should allow the mass media to fall under the control of non-residents or foreigners, we would have no semblance of independence or sovereignty left. This would surely erode the very foundations of any aspiration toward any type of Canadian independence or Canadian sovereignty. As I say, it is just beyond my powers of understanding when we are talking about the mass media here, when we are talking about legislation designed to preserve Canadian ownership in the mass media field, when we acknowledge that the mass media is one of the essential

June 15, 1965
Income Tax Act
elements In forming a national identity, and when we are proposing the legislation which is so necessary to preserve that identity, that the Leader of the Opposition seems to have given up any hope of plans for the preservation of the independence and sovereignty of this country.
I noticed another thing in the position taken by the Leader of the Opposition, which was disturbing. I refer to the fact that no alternative policies were advanced. I find it impossible to believe that the Leader of the Opposition or any other Member of this House could complacently sit back and watch one of our newspapers like the Globe and Mail, the Toronto Star or the Montreal Star fall into the hands of non-residents. I do not believe that any Member of this House could accept that type of development with peace of mind. It would be bound to cause considerable pain. It would be bound to cause considerable aggravation to every Canadian because he would realize this was a further example of the encroachment of foreign ownership and control of our country. This would be an area in which the dissemination of ideas would be involved, and not just physical assets.
If the Leader of the Opposition is just opposed to the method of implementing this proposal and is not opposed to the over-all aim of the legislation, one would have thought that the party opposite would have advanced some alternative proposal by means of which the purpose of this legislation could be accomplished. No such proposal was advanced. In fact, this has been the position of all of the critics of the present policy. They admit that the Federal Government has no other legal means by which its aim could be accomplished. They realize that under the British North America Act we do not have the power to legislate with regard to the ownership of property. Perhaps this is the reason no alternative proposal was brought forward.
Surely a party that has gone on record from 1958 to 1962 as being most concerned with this problem could find an alternative, otherwise it is sheer irresponsibility to oppose this proposal. They must certainly accept the challenge of coming up with some other adequate means of accomplishing the same end, or support the Government on this particular piece of legislation before us tonight. If they do not do so, then they are guilty of the greatest contradiction, the greatest reversal of policy I have ever heard in this House during the short time I have been here.
I should like to refer to one or two other matters. One suggestion I have heard ad-

vanced in some quarters as an alternative means has been some type of subsidy arrangement advanced by the Federal Government to these periodicals. I am referring now to periodicals rather than newspapers. This would be a means of preserving the Canadian periodical and preventing it from disappearing as a result of this unfair competition to which so much reference has been made today. Anyone who advocates that type of arrangement certainly would be flying in the face of those who indicate concern about the limitation on the freedom of the press, interference with the press by Government.
I have yet to hear anyone indicate that in a subsidy arrangement there is not an intangible influence by the Government upon the periodical involved. Perhaps this is the reason we do not hear the subsidy argument advanced in this House. I think we must look back and accept the fact this legislation is inevitable. We must look back to our own Royal Commission and the conclusions to which it has come. We must look back to what almost happened to the Globe and Mail, when a non-resident investor submitted a bid and undoubtedly if his bid had been higher the Globe and Mail, which holds itself out as being Canada's only national newspaper, would have fallen into the hands of nonresidents. Developments such as these undoubtedly prevailed upon the minds of the Government and the Minister of Finance when introducing this legislation. Developments such as this injected a degree of urgency.
[DOT] (7:20 p.m.)
In conclusion I would like to reiterate the point that this legislation is consistent with the type of legislation we have in other areas respecting mass media and the communications field. It is consistent with the limitations involved in the radio field to preserve Canadian ownership. It is consistent with the limitations involved in the television field to preserve Canadian ownership. None of us heard any criticism from any opposition party when those controls were imposed and in fact the origin of such limitations goes back many years. No one heard any such criticism about limitation of freedom when only periodicals were involved. We just began to hear it when newspapers were included.
This legislation is in the national interest. It is not a limitation on expression. It is not a limitation on freedom of the press. It is consistent with other legislation dealing with the mass media field. If we desire any sem-
June 15, 1965

blance of preserving Canadian identity in the important field of mass media it is in the national interest that this Chamber should approve this measure.


Mr. Clancy:: The hon. Member has just made a statement that no one opposed the C.B.C. I can refer him to many pages in Hansard showing there was a lot of opposition at the time that was introduced.


John Carr Munro: I do not know whether the hon. gentleman who has just spoken is aware that the C.B.C. was originated and set up under a Conservative government.


Gordon Drummond Clancy: That is right, but you made a statement that nobody in the House of Commons opposed it. Read your Hansard and you will see a great many people did.


J.-H.-Théogène Ricard: Mr. Chairman, we have just listened to the second part of the band concert accompanying the introduction of this resolution. Last night the Minister of Finance (Mr. Gordon) told a rather sad story in glowing terms when he dealt with the question of income tax. Tonight the parliamentary secretary to the Minister of National Health and Welfare, another member of the band, tried to convince us that this measure was worth its weight in gold.
This resolution gives me, once again, the opportunity to emphasize the viewpoint of the low wage Canadian. As a matter of fact, if I have decided to say a few words on this resolution, it is because the Canadian wage-earner is taxed more than ever before in the history of Canada. On the other hand, besides being taxed as he has never been before, he has to cope with the cost of living which has never been as high since Confederation.
That is why, Mr. Chairman, I will try once again at this time to make representations on behalf of the small wage earner.
Nowadays, heads of families in the low income bracket are up against all kinds of difficulties; they cannot make both ends meet and every year their situation gets worse. Even if the Minister of Finance, as I said a few moments ago, announced in glowing terms a 10 per cent reduction, we find, after closer examination, that many people will not benefit by this reduction. One cannot help but think that this government has only one objective in mind: to assist people in the higher income brackets as much as possible and those in the lower income brackets as little as possible. This is not the first time, Mr. Income Tax Act
Chairman, I have risen in this house in an attempt to convince the Minister of making changes with regard to personal exemptions. The Minister would have accomplished his duty and done something for the small wage earner had he announced an increase in personal exemptions and deductions for dependants.
I should like to say once more to the Minister that, in these days, it would only be fair and reasonable for single persons to have personal exemptions of at least $1,500, while the exemption for married people should be increased to $3,000 from $2,000. In regard to dependants eligible for family allowances the exemption should be $350 at least, instead of $300. As for dependants over 16 years of age who are not in receipt of family allowances, the head of the family should be able to claim an exemption of $600 instead of $550.
A few moments ago, when I listened to the parliamentary secretary to the Minister of National Health and Welfare (Mr. Munro), I was under the impression that he intended to convince us that absolutely nothing had been done to help employees in the lower brackets before this government took office.
For his information, I will point out that when we assumed power in 1957, or at least at the beginning of 1958, we raised the personal income tax exemptions for dependants so that all large families could benefit further from deductions. I believe we thus set an example which could be followed by this government. During electoral campaigns, the Liberals are lavish with their promises; once in power, they should live up to those promises. I know that I would be out of order if I proposed the removal of the 11 per cent tax which has largely contributed to increase the living costs. I shall therefore abstain from pursuing the subject.
There is another field where the minister could do something to help those who really need help. This involves increasing immediately the old age pension from $75 to $100 monthly for all Canadian citizens age 65 or over.
When the minister dealt with this question some time ago, he announced that pensioners would receive $75 at age 65, but they will have to wait at least four years more. Mr. Chairman, you know that when one reaches the age of 65, one has much less years to live than one has lived. Therefore, chances are that even though the minister's promise may be attractive for our older citizens, the latter will not, in the final analysis, be able to

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take advantage of the generosity shown by the minister when he announced this change in old age pensions.
Now that the Minister is in his seat, I should like to ask him once again to take my suggestions into consideration, so that something be done for those who are truly in need. It is not to those who earn a salary of $15,000 and more that a $600 exemption should be granted, but rather to those who need it the most, the small wage earners whose family responsibilities are greater and more onerous. I will not speak further. I simply urge the Minister to bring his immediate attention to those who need it most. [DOT] (7:30 p.m.)


Mr. Barnett:: I should like first of all to make a brief reference to the general subject which was dealt with a short time ago by the Parliamentary Secretary to the Minister of National Health and Welfare and earlier by my hon. friend from Port Arthur. I will make no attempt to join the Parliamentary Secretary in psychoanalyzing, as it were, the position taken by the Leader of the Opposition but I should like to say something in connection with the questions raised by the hon. Member for Port Arthur-I noticed that the Parliamentary Secretary carefully skirted around them in the course of his remarks about the freedom of the press. I am referring to the proposal which will allow certain editions of Time magazine and Reader's Digest to continue as wholly Canadian publications.
My hon. friend made the suggestion-and I think it is a reasonable one-that this is a question which should be submitted to a free vote by Members of the House of Commons. Despite the fact that this has been brought forward as a budgetary proposal because of the mechanics involved, I do not believe this is really a budgetary matter. I think the Minister of Finance would agree that this is not primarily designed to affect the balance of ways and means; it is a matter which concerns our outlook as Canadians on our culture and its development, and the provision which should be made for the dissemination of such things. While I have made no particular effort to discuss this matter with private Members on the other side of the House I strongly suspect a great many of them are not happy about the present proposal. Indeed, I would be very surprised if the Minister of Finance himself were very happy with this situation. The remarks made by the hon. Member for Port Arthur this

afternoon remind me of a situation in which I found myself a number of years ago when a proposal dealing with this subject was brought forward by a former Minister of Finance, Mr. Walter Harris. As one of the Members of this House representing the then four parties in the Chamber I was invited to take part in a panel discussion in a posh Laurentian resort before a convention of advertising executives. I found myself in the unusual position of being the only person there prepared to support the position taken by the Minister of Finance of that day. The representative of the Liberal party in our group came from a Montreal constituency, I believe. When he rose to speak he announced that this was one of the occasions when he would be bound to disagree with the Government he normally supported. If an arrangement could be made to have a free vote I suspect that a good many of the Government's present supporters might indicate they were not happy with this perpetuation of what is, to me, an unhappy situation. We are not dealing with the true facts of the situation when we regard magazines which are, basically, produced in another country as being Canadian.
I do not believe anyone here would suggest there should be any limitation on the flow of publications into Canada from other countries. I think all of us are in favour of a free exchange of ideas in the international field. But we have a responsibility in this Parliament to deal with a situation where certain publications are able to bring out publications masquerading as Canadian though in reality they are not.
[DOT] (7:40 p.m.)
Reference was made in the budget proposals of the Minister of Finance to the matter of providing the opportunity for considering as an expense, if I understand it rightly, expenditures that are made to eliminate or prevent water pollution. This proposal has not been spelled out in any great detail and I suppose this may have been because the Minister regards it as one of the incidental features of his budget. However, as far as I am concerned, I consider this to be one of the more significant suggestions the Minister has made.
I do not know whether or not this will be an effective way of encouraging the reduction of the pollution of our rivers, lakes and other waters, but if this proposal is to be brought forward, which will allow expenditures for the reduction of water pollution as deductible expense, I should like to sug-
June 15, 1965

gest to the Minister that when he brings this proposal forward in its final form consideration be given also to including similar expenditures as taxable expenses in the field of the reduction of air pollution. I feel these two subjects are closely linked. Protection in respect of the purity of our air is equally as important as protection in respect of the purity of our water. I should like to put forward the plea that these things be placed in the same category.
Perhaps I can attempt briefly to indicate why, among other reasons, I have a particular interest in bringing this matter forward. To illustrate my point I should like to quote from some remarks attributed to Dr. Donald Anderson of the University of British Columbia Medical Faculty, who was reported last January as having said that in the Alberni Valley area, where I live, five times as many people suffer from respiratory diseases than anywhere else in British Columbia. This comes about partly because of the particular climatic condition which prevails and partly because we have a very large industry based upon our forestry products.
This matter of air pollution has been of continuing and increasing concern to some 25,000 people who live in this valley, as it has been of increasing concern to people who live in many other parts of this continent, including such places as Vancouver and of course, across the line in the City of Los Angeles, in respect of which we hear a great deal about their notorious smog.
This matter is one about which there is still some uncertainty, and one which requires in my view a good deal of further research. I am glad to say that in a very modest way the Department of National Health and Welfare has made a grant to assist a research team operating within British Columbia to make a comparative study of this particular situation where there is this high level of respiratory disease, and to attempt to determine just how far and in what way these diseases are a result of the industrial effluence which pours out into the air.
Pressure continues to be made on industry to make greater expenditures to eliminate the pollution which even though it may not be as injurious to health as many medical authorities fear, nevertheless, remains a very unpleasant situation with which one must live. In this connection I should like to quote briefly from some remarks made by the Secretary of the Interior of the United States on this subject which appeared in an article published in Pulp and Paper of March 15, 22620-157
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1965. The Secretary of the Interior was referring to the continuous flood of complaints he receives about the subject of air pollution.
Mr. Udall is reported as having said:
The stock argument that these conditions are part of the "price which must be paid for progress" will not be tolerated much longer. The avalanche of protest does not come from fanatics and crackpots -it comes from solid, informed members of the community who are not demanding the impossible. Their mounting impatience is caused by justifiable belief that too little is being done to achieve the possible.
Following that argument advanced by Secretary Udall, I believe what he has said certainly applies in this country. If the Minister of Finance is going to take budgetary measures to encourage industrialists to reduce the level of water pollution certainly it is equally important that those measures be applied in respect of air pollution.
Dr. G. H. Bonham, who is the medical director of an area health unit in the Vancouver Island region, from which I come, has been making some study of these matters and has made some public comment in this regard. He refers to the lack of proper bylaws to control pollution, but he states, and I am referring to a newspaper report which appeared in the Victoria Daily Times of November 16, 1963:
-that industries could not be entirely blamed for not using odour and smoke control measures when "the public complacently accepts the smell of money."
He added that good control equipment was not prohibitively expensive

In another report of the same speech by Dr. Bonham, which was carried in the Nanaimo daily Free Press, he is reported as having said:
We are not in complete ignorance as to how to achieve this control. Ask the Swedes!
They employ chemists from the B.C. Research Council (a tax-supported body) to advise them on both the installation and operation of smoke and odour control equipment.
Lack of knowledge is thus not the only limiting factor.
I have sat in at meetings where management of industry has complained about the high cost of increasing the level of pollution elimination, and it on those grounds that under the circumstances, if the Minister is going to move into the field of encouraging expenditure in respect of water pollution, I ask as well that he include also encouragement toward the increasing of elimination of pollution of Canadian air.
[DOT] (7:50 p.m.)
While I am on my feet I should like to make reference to one other matter, and this is a

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subject which has become a hardy perennial, as far as I am concerned. In fact, I believe I have raised this question in respect of every budget since I have been a Member of this House. I refer to what I consider to be a basic inequity in the Income Tax Act in respect of people whose incomes are derived from salary and wages. I raised this matter during the discussion on the last budget. The Minister of Finance may recall that support came from quite a number of Members in the House for an amendment to the Income Tax Act which would meet this problem which is faced by workers who, because of the nature of their employment, have to work and live for part of the time away from their normal place of domicile.
I must say, Mr. Chairman, as I listened to the remarks of my colleague from Nanaimo-Cowichan-The Islands regarding the cavalier way in which the Minister apparently went about the preparation of this budget and said "Well, I guess we can afford a little tax reduction so we will make it 10 per cent across the board, and that is that", that I could not help but agree with him that the Minister could have much more carefully considered the nature of any tax reductions that he was going to make. When he introduced his first budget I know he was criticized rather severely in some quarters of the House for having had too much help in its preparation. In this case I think he has gone to the other extreme and has had no help in the preparation of this budget. He has simply said that he will throw out the sop of tax reductions and this is the simplest way of doing it, because it will save any headaches which might be involved in studying how to approach the matter.
I listened to the Minister last night, and if I heard him correctly at that time he made some remark to the effect that he felt that if there was going to be an income tax cut it should be done in a manner which would apply equally to all Canadians in all parts of Canada. I could very well take those remarks as a text for my argument in respect to section 5 (a) of the Income Tax Act. I have attempted to be helpful to the Minister several times in proposing amendments, and if he does need any further help at this time I could refer him to Bill No. C-42, which is on the order paper in the name of my colleague the hon. Member for Skeena. As a matter of fact I think I should say that the hon. Member for Skeena and I are, in effect, co-authors of this particular bill, and if I 
would not be in breach of the Criminal Code I might admit that we had tossed a coin to see whether this bill would go on the order paper in his name or mine. This bill sets forth what, in our view, would be a suitable amendment to the Income Tax Act, the kind of amendment which, as I mentioned to the Minister last year, I felt I was on the verge of persuading the former Minister of Finance, Walter Harris, to introduce in the session prior to the time when he ceased to be a Member of this House.
Without arguing this point any further, Mr. Chairman, I should like to place on the record of this discussion the exact proposal that I should like to see adopted, and I hope that the Minister, in the light of the very sound advice offered to him by the hon. Member for Nanaimo-Cowichan-The Islands, will reconsider the ill-considered proposal he has made for passing on something by way of an income tax reduction. I should like to see section 5 of the Income Tax Act amended by adding after subsection (2) the following subsection:
(3) Notwithstanding subsection (1), in computing the income of a taxpayer for a taxation year from an office or employment, there shall not be included
(a)	expenses necessarily incurred by him for board and lodging by reason of his employment at a distance from the place where he maintains a self-contained domestic establishment:
(b)	expenses incurred by him for transportation between his ordinary place of residence and his place of employment where, by reason of distance, he is required to live away from home to perform the duties of his employment; or
(c)	expenses incurred by him for depreciation and replacement of tools and special equipment or clothing which are necessarily required by him in the performance of the duties of his employment.
If I may say so, Mr. Chairman, a proposal of this kind, which the Minister is well aware has been suggested by, among others, the Canadian Labour Congress in a number of its briefs to the Federal Government, would be a much better measure in the interests of the working people of Canada than the proposal which the Minister has inserted into his budget income tax resolution, I would guess as a sort of afterthought which will allow the deduction of trade union and professional society dues over and above the minimum $100 deduction. This, I suppose, is a gesture. It really does not amount to very much, but the proposal to amend section 5 of the Income Tax Act for which I have been arguing for so many years would be much more in accordance with the principle of equitable application of an income tax levy on the working people of Canada.
June 15, 1965

245?


Gilles Grégoire: Mr. Chairman, I had no intention of taking part in this debate, but since I read the speech delivered last night by the Minister of Finance CMr. Gordon), when he ventured to talk about Social Credit, I just have to say a few words about that speech which will be famous from now on.
First of all, I must say that faced with a statement such as this one, full of sophisms and dialectic errors and hardly scientific, one wonders what is the best way to answer it. Should one try to explain to the Minister of Finance such a subject, or use a humorous tone, as he did, to answer the speech he delivered yesterday?
I noticed a very great resemblance between the speech-


Walter Lockhart Gordon: Mr. Chairman, on a point of order, I think my hon. friend is talking about an entirely different bill, with which we were dealing yesterday.


Herman Maxwell Batten: I think the point of order is well taken. The hon. Member for Lapointe is referring to a different debate and I would suggest to him that he confine his remarks to the resolution which is before the Committee.


Gilles Grégoire: Mr. Chairman, I did not intend to speak about the bill, but only about the speech which was delivered by the hon. Minister of Finance, which is not at all the same subject.
I notice that the hon. Minister is once more deviating from his dialectical tactics and that he is attempting to put forward spurious arguments. That is why I do not intend to talk about the bill we were considering yesterday, but I would like to take advantage of this proposed resolution on the amendments to the Income Tax Act, which is a constituent and integral part of our economic system, to talk about the same economic matters with which the Minister dealt yesterday in this house. I believe that I may do so under the circumstances and that I am not straying from the subject matter.
Mr. Chairman, I see that the Minister of Finance, in the famous speech he delivered yesterday, used the same tactics as the hon. member for St. Jean-Iberville-Napierville (Mr. Dupuis) used during the last federal election, tEnglish]


Herman Maxwell Batten: I must remind the hon. Member for Lapointe that we have before
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us a single resolution, and his remarks must fall within the terms of that resolution.
[DOT] (8:00 p.m.)


Gilles Grégoire: Mr. Chairman, a while ago, I heard another member talk about water pollution. In my opinion, that had no more to do with the item now before us than a few comments I was about to make on a mere speech made by the Minister of Finance. That is why I am surprised to see that, even before I started, you called me to order. I feel that my remarks will apply perfectly to the resolution we are now discussing.
As I was saying, the Minister of Finance used the same arguments used during the 1983 election campaign by the hon. member for St. Jean-Iberville-Napierville, who always referred to inflation when talking about Social Credit.
The Minister of Finance, once again, spoke of inflation. He brought up the same arguments that the hon. member for St. Jean-Iber-ville-Napierville used. But in the resolution now under consideration, there is something which we find much more interesting: the personal income tax is to be reduced by an amount equal to 10 per cent of the basic tax.
Well, Mr. Chairman, in the speech made by the Minister of Finance, I read this sentence which is directly related to what I have just said.
I would now like to comment as briefly as possible on the matter of the interest on the public debt and see if it represents such a burden or a loss of purchasing power, as claimed by some hon. members.
The minister added:
It is true that the interest on the public debt represents an expenditure for the government.


Walter Lockhart Gordon: On a point of order, Mr. Chairman, with great respect may I say that I think the House has given the hon. Member for Lapointe many opportunities to expound his theories. It seems to me we have rules that some of us try to live up to and that the same rules should apply to the hon. Member. There is nothing in the resolution before the House that has anything to do with anything that the hon. Member has said so far. With great respect, Mr. Chairman, I would hope you would keep him in order.


Gilles Grégoire: On the point of order, Mr. Chairman, I should like to point out that the Minister of Finance seems annoyed, because we are challenging one of his speeches.

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I would also point out that he took advantage of the fact that he was the last speaker yesterday, to conclude the debate, when nobody could answer him. I say that when a Minister of Finance speaks when he knows that nobody can answer as he did yesterday, shows that he is afraid to put his ideas forward.


Herman Maxwell Batten: Order. I should like to point out to the hon. Member for Lapointe again that he is referring to a speech made during a separate debate. I do not think there is anything in the terms of the resolution before the House that provides him with an opportunity to make any reply. Again I must ask the hon. Member to co-operate with the Chair and to confine the remarks he is making so they can be included within the limits of the resolution before the Committee.


Gilles Grégoire: Mr. Chairman, I submit to your ruling, but I still think the Minister of Finance is wary of discussion and that he only ventures into a discussion when he is sure nobody can answer him back. It shows a lack of courage of one's own convictions.


Herman Maxwell Batten: Order. Three times I have asked the hon. Member to confine himself to the terms of the resolution. I wish he would do so now.


Gilles Grégoire: Mr. Chairman, I shall abide by your ruling. I know that the Minister of Finance is much relieved because he is afraid of discussion.
Under section 1 of the resolution under consideration and which I quoted earlier, the income tax is reduced by an amount equal to the lesser of 10 per cent of basic tax or $600.
For the low wage earners-but we know that the Minister of Finance is not interested in them

this will mean practically no reduction at all, because it only adds up-and the Minister of Finance gave us the figures himself-to a few dollars for those earning less than $4,000 or $4,500. This 10 per cent reduction will represent a fairly large amount only for those who are in receipt of higher salaries, that is, those who the Minister of Finance has to protect in the house at the expense of the common people, the low income groups. The Minister of Finance agrees to advocate their theory since

he defends them so well and reduces their tax by 10 per cent, a cut which does not apply to the small wage earners.
In my opinion, paragraph 1 of this resolution should be changed and an income tax exemption should be granted mainly to those with inadequate salaries. For instance, we have been suggesting for a long time-and this would not cause the inflation about which the Minister of Finance talks through his hat-to raise the basic tax exemptions to $1,500 for single people and $3,000 for married people. That would at least enable small wage earners to keep the little they have instead of giving it back to the Minister of Finance to allow him to repay the interest on the public debt.
I agree with the Minister of Finance that the interest on the public debt does not impoverish the little man-that is what he said in his speech yesterday. But it remains that out of the income tax collected on the salaries of small and big earners alike, $1.1 billion is used to pay the interest on the national debt.
The Minister of Finance is ready to fight for such a system. As for us, Mr. Chairman, we submit that tax exemptions should be raised to $3,000 for married people and $1,500 for single people.
Mr. Chairman, those are the only remarks I wanted to make at this stage of the resolution.
I would have liked-as I said earlier-to talk a little about the heretical views of the Minister of Finance on the monetary system. Although he knows nothing about the present monetary system, he prefers not to hear the truth and to hold discussions during which he is the only one to speak so that his remarks go unchallenged. Therefore, I leave him to his ignorance.


Mr. Flemming (Vicioria-Carleton):: Mr. Chairman, I wish to take advantage of the opportunity presented by this resolution to bring to the attention of the Minister an omission which I feel he will be glad to correct at the earliest possible moment. In the Minister's budget speech and under the heading of "Accelerated Capital Cost Allowance" he makes reference, as found on page 436 of Hansard, very properly, I think, to the fact that he wishes to make some special allowance for facilities for the storage of grain. He takes note of the fact that storage facilities are needed for corn production in parts of Ontario, refers to changes in har-
June 15, 1965

vesting techniques and goes on to say that transportation and grain handling facilities should go hand in hand.
[DOT] (8:10 p.m.)
Now, the matter I want to bring to the attention of the Minister relates to the question of storage facilities for root crops. This is of particular importance to the constituency which I have the honour to represent since part of western New Brunswick, particularly the counties of Victoria and Carleton, are large potato growing areas. In this day when chemical fertilizers are used substantially, the crop per acre is very large. This brings to mind the fact that the planting of the crop and then the harvesting of it is a major operation. The marketing of the crop cannot be carried out unless there are adequate storage facilities. Obviously in the autumn of the year a full year's production has to be harvested and these potatoes must be taken care of for the full year in order that they may be marketed in an orderly fashion. They have to be protected from the frost during the winter and from excessive heat in the spring and early summer, so there will always be a supply of potatoes available for the market.


Lucien Lamoureux: Order, please; I regret that I have to interrupt the hon. Member at this moment, but the Chair would like to have a little more quiet in the committee. There are conversations on both sides of the curtain which make it difficult for the Chair to follow the hon. Member.


Hugh John Flemming: Thank you, Mr. Chairman. I hope hon. Members take due notice of your admonition.
The point I was trying to bring to the attention of the Minister was the need for including in these income tax regulations the same sort of consideration for refrigerated storages for the potato crop of New Brunswick as is envisaged for the grain growing parts of Ontario and Western Canada. I believe this question of orderly marketing is most important. The matter of the potato crop itself is very important to that part of New Brunswick which I represent. It is necessary, if people are to be able to conduct orderly marketing, to have access to markets not only in Canada but also in the United States and South American countries. This question of refrigerated storage then becomes most important.
It is with these facts in mind, Mr. Chairman, that I make these brief remarks. I request the Minister to take notice of these facts when he finally brings his bill before
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the House. I hope he will make provision for accelerated depreciation facilities for the storage of the potato crop and root crops in general, and I hope this problem will be recognized and dealt with in a satisfactory way.


Mr. Mackasey:: Mr. Chairman, in keeping with the new rules of the House and the desire for Members to be brief, I certainly do not intend to talk at any great length this evening. My participation in the debate at the moment is motivated primarily by the subject to which the hon. Member for Port Arthur referred, namely, the proposed legislation on periodicals. I was intrigued by the number of speakers participating in this debate who have expressed the opinion that probably the Minister of Finance was unhappy at having to sponsor the proposed legislation on periodicals. I feel this is a tribute to the Minister because I think it is realized, and this probably prompted these observations, that the Minister of Finance has shown a degree of Canadianism that most of us feel is important at this crucial time in the history of Canada.
I believe it is no secret to most Members of this House that the Minister of Finance certainly comes from a background with which I am not too familiar. I believe that by my standards, and the standards of my community, the Minister is amongst those privileged Canadians who are not necessarily waiting for the next pay cheque. Because he is a typical example of big business in so far as success is concerned, I think his concern about the Canadian identity is much more refreshing. Certainly some of the legislation proposed by the Minister was hardly the type of legislation that would necessarily endear him to the closely knit financial community with which he was so closely associated before he became a Member of the House of Commons. I agree with those who sense that the Minister is not too happy with the proposed legislation.
I cannot help but remember my participation in the debate just a year ago. At that time the hon. Member for Edmonton West reminded me that probably I would eat some of the words I uttered at that time. I shall refer in a minute or two to those words. I believe one of the tragedies of Canada, as we approach our centennial, has been our inability to act and believe as Canadians. I believe that we owe much to the Province of Quebec and French speaking Canadians. They cannot take the lazy way out as we English

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speaking Canadians do, when we rely heavily on the periodicals, publications and television programs from our friends to the south. French speaking Canada has had to foster, support and cultivate its own mediums of culture. When we English speaking Canadians cease to fear French Canadian domination in their own province, we will all benefit from the fact that in Quebec we have some distinction from the culture of the rest of America.
There are four fields of communication, Mr. Chairman, radio, television, newspapers and periodicals which have a very definite bearing on the cultural future of Canada and perhaps of Canada as a nation. A year ago, I did express an opinion in the House which I am glad to repeat, and which can be found at page 2122 of Hansard. I said at the time that I felt very strongly that Reader's Digest and Time magazine were American publications, have always been American publications and fully intend to remain American publications. I went on to say that it was my strong view that so far as the editorial content of a magazine was concerned, the nationality of the people who wrote the editorial should be the criterion of whether or not the magazine was Canadian or American.
[DOT] (8:20 p.m.)
In the year that has elapsed I have not changed my opinion. Reader's Digest and Time magazine are American periodicals. I have not changed my desire to help promote those magazines we consider to be Canadian. Where I have differed over the year is whether or not the legislation proposed a year ago by the Minister of Finance (Mr. Gordon) would do anything for our Canadian magazines. Like all hon. Members I have been subjected to the lobbyists of Reader's Digest, Mr. Zimmerman and Mr. Gundy of Time magazine; but nobody, including the hon. Member for Port Arthur (Mr. Fisher) has yet convinced me that any advertising revenue released by the expulsion of Time and Reader's Digest would flow into what we call Canadian magazines.
This is the essence of my doubt a year later. If somebody could get up tonight and convince me that the elimination of Time and Reader's Digest from the Canadian scene would automatically ensure the future of Maclean's, and other Canadian magazines, I would be the first to vote for this legislation; but somehow I am afraid the problems of Canadian periodicals run a little deeper than

legislation to force advertising revenue into the pockets of those magazines.
A lot of us are dissatisfied with this whole thing, but I agree with that section pertaining to newspapers. By no stretch of the imagination can the proposed legislation be interpreted as an impediment to freedom of speech or communication. We must have a free and unfettered Canadian press to write our editorials, to criticize the Government, to bring justice to the fore, to discuss the question of Viet Nam and many other contentious problems where there is dissidence and differences of opinion. There is a danger in having our newspaper editorials dictated to us from friendly sources outside our nation.
If Canada in the next century is to emerge as a nation we must in many ways depend on the strength of our communications in the mass media field. If I am dissatisfied with the proposed legislation it is because it does nothing, absolutely nothing, to divert advertising dollars from those radio and television stations that permeate the perimeter of Canada just below our border in Buffalo, Plattsburg, and similar places. What is good for the goose is good for the gander, and if we are going to attack this thing in the proper manner then it is time we take a closer look at television and radio.
It is a welcome sign that the Minister's proposed legislation will at least eliminate certain abuses. After so many years of bickering Reader's Digest and Time are entitled to be told once and for all where they stand. While I am not particularly concerned for either Reader's Digest or Time as a corporation I am concerned for the employees who work for them, who worry about the future, who would like to know what the future is, if anything, who would like to know whether they are wasting their time away or whether they are living on borrowed time.
By our Canadian standards of fair play we owe some explanation or decision to these people, these employees and other people affected by the industry, so that they may know where they stand. If we intend to run Reader's Digest and Time out of the country, then let us do so, but let us not leave them in a state of abeyance so that their employees and people affected indirectly suffer unpleasantly about their economic future.
In conclusion I would like to reiterate my admiration for the Minister of Finance for being willing to sponsor not only this type of legislation, imperfect as I think it is, but for his willingness to push the Canada Development Corporation, and his willingness
June 15, 1965

to try to establish a Canadian identity in our business. It is refreshing, as I mentioned earlier; and each time the Minister of Finance takes a step in this direction he arouses the animosity of those who were, not his playmates but certainly his business associates for many years. I think the Minister of Finance meets the criteria of a good Canadian, but I think the time has come for us to stop living in the mistaken belief that the simple expediency of punishing Reader's Digest and Time will automatically alleviate the problems of Canadian publications.


Mr. Patterson:: When the Minister made his introductory remarks he said the Government was awaiting the report of the Committee on Taxation before making any substantial changes in the tax structure. For years Members of this party have advocated a thorough revision of the whole tax structure, which at present has got to the stage that it is almost impossible to analyse it and find out just what is involved. As time goes on, rather than being simplified it becomes more complex and confusing. When the tax committee makes its report I hope it will make definite recommendations which the Minister will be prepared to implement in order to relieve the tax burden on the Canadian people.
At page 10 of the Report of the Royal Commission on Banking and Commerce we find these words:
We also believe that Canadians want the basic freedom to arrange their financial transactions with a minimum of interference, and have approached our task in this light.
This is a very significant statement because, with the passage of time, Canadians are finding it much more difficult to arrange their own financial transactions. The Government is moving in in every conceivable way, until it seems the taxpayer is hemmed in on every side. The handling of his financial transactions is taken out of his own hands by the Government, under the implied idea that the Government can handle a person's financial transactions better than he can himself.
When this commission reports I hope it will make substantial recommendations with a view to alleviating the burden on the Canadian people as a whole.
[DOT] (8:30 p.m.)
I would like to refer briefly to the 10 per cent tax cut which has been played up as something significant to the economy. It may be an indication that the Government is
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reversing its position and is moving toward a reduction of taxes. If it is establishing a trend, I think it is worth while, but if this is not the case I do not think it is significant in the over-all picture, bearing in mind that no tax relief is being given to those in the low income brackets. I believe there are other ways in which the Minister could have cut taxes-ways which would have been of greater benefit to the Canadian people. For instance, I believe many Members of this House thought a higher basic exemption would have contributed more than this 10 per cent reduction.
Some time ago the newspapers published an insinuation that we in the Social Credit Party had voted against the raising of the basic exemption for income tax purposes. I wish to state clearly and definitely tonight that the Social Credit Members in this House did nothing of the kind. There was a want of confidence motion brought before this Chamber criticizing the Government for not increasing the basic exemption. It is true we voted against that motion. There was nothing positive about it. Had it carried we would still not have had higher basic exemptions. We therefore took the position that it was not worthy of support. But we have consistently supported the principle that there should be higher basic exemptions. When the figure of $1,000 was established many years ago in respect of a single person it was based on the assumption that in order to secure the necessities of life a basic exemption of $1,000 was required. If this were true so many years ago, how much more true is it that a much higher sum is required today when we are faced with constant increases in the cost of living and a decline in the purchasing power of the dollar.
There are two or three other changes I should like to have seen made in this resolution. I should have liked these proposals to have included a provision that all property taxes be deductible for income tax purposes. I read an article some time ago to the effect that the Progressive Conservative Party intended to make this one of the planks in its election platform. We are not surprised. It would not be the first time that they have taken planks out of our platform and used them. This is something we have advocated for a number of years. In fact I have a document here which was put out a long time ago by the Social Credit Association of Canada and on page 16 we read: "Full property taxes should be an allowable deduction for income tax purposes".

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Income Tax Act
I have an article here from the Ottawa Citizen of May 20, 1965. I will read part of it. It says:
A resolution asking for some relief from personal income tax for homeowners was approved Wednesday by the Canadian Federation of Mayors and Municipalities.
The mayors agreed at their annual meeting that the money paid out in municipal taxes should not be subject to further taxation and should be a deductible item on the income tax form.
Once again I am happy that Social Credit is right in line with popular proposals. I believe the Minister of Finance should take cognizance of this recommendation and have it included in the resolution, and in the bill which is to follow.
I do not expect it will have any practical result but I believe it does not hurt to reiterate some of these things. If the Minister of Finance wanted to find a way of helping the economy he could have done so by rescinding the legislation with regard to the taxes on building materials and production machinery. The Minister has insisted down through the months that this action was necessary and justified, but I suggest that in the over-all picture the rescinding of these taxes would have provided a tremendous boost to the economy.
Clause 10 of the resolution has to do with income tax allowances in respect of clearing land or laying tile drainage for the purpose of carrying on a farm business. This is a commendable provision. Possibly it will have a decided impact on the economy of various communities, especially in areas where it is necessary to do a great deal of land clearing and levelling in order to make farming profitable. We express appreciation to the Minister for this proposal at least.
I do not intend to take any further time dealing with this measure but we trust that the day is not too distant when the Minister of Finance, basing his considerations on the report of the Royal Commission, will work out some way of bringing to the people of Canada adequate and effective relief from the burden of taxation which is now becoming intolerable.


Mr. Herridge:: First, may I say that while we differ from the Minister strongly on certain questions relating to taxation, all of us in this group look upon him as one of the nicest men who ever undertook legally to pick a Canadian pocket.
We presume this is a stopgap budget, a mark-time budget, as it were. As the Minister has mentioned, the Government is await-

ing a report from the Royal Commission on Taxation. I hope that when we get this report it will provide an opportunity for us to lay a sound and equitable tax base in Canada. Positions with regard to Federal and Provincial taxation are changing. I do hope that as a result of this report the Provinces and the Federal Government will have an opportunity to develop a logical tax structure in which fields of taxation and responsibility are clearly defined.
[DOT] (8:40 p.m.)
There is great concern among many people of this country about United States ownership and control of our resources and our industries, as well as concern about borrowings from the United States particularly by municipalities for the development of social projects in Canada. In that connection I should like to read an extract from a pamphlet sent to me by some students in Montreal. It is entitled "Identity". I have talked with a number of students in universities throughout this country and I have been very pleased to discover that there are large and increasing numbers of young people who are interested in the type of society we are developing under the present circumstances.
I feel that the following statement is rather good:
Again, if we desire an equalitarian society in Canada then we must have ownership and control of our economy. It is simply impossible to create a country with full medicare, full pensions, free education for everyone, full employment with a high degree of cultural leisure life, while the wealth we create fills the coffers of another country and our resources are utilized for that country's benefit.
In that connection all of us in this group wish the Minister every success in all he undertakes to restore Canadian ownership in those fields I mentioned previously.
It is my intention now to make a few observations in respect of exemptions. From my own personal experience I believe there are some valid reasons for suggesting that the exemption of expenses in respect of travellers and others entertaining in connection with business is sometimes overdone. I have actually been present when commercial travellers have phoned to points 100 miles from where they were taking orders, who in turn put in expenses as though they had travelled to the point to get the order in question. More attention should be paid in respect of these business expenses.
Recently I was in Montreal and received information to the effect that there are golf clubs there with membership fees of $5,000
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1365

per year. I was told by one of the members that the membership fee is deductible for income tax purposes because this was considered as a form of entertainment for customers and clients. This is another aspect of this question of deductible expenses that should be looked into very carefully.
One other matter I wish to mention, which has irritated me considerably because I am strongly opposed to this form of exemption, is the matter of exemptions allowed to the organization known as the Moral Re-Armament organization. I know that when I talk about this subject I tread on the toes of some very sincere and honest people, but I have gone into this question very thoroughly and I know of what I speak. I may say that I was told once by a former member of the Cabinet that in his opinion he considered this a most sinister organization.
This organization receives very large exemptions on the grounds that it is a religious and charitable organization. It carries on very expensive advertising in daily newspapers in Canada. It publishes books, and has other large expenses of a similar nature. When I asked a question in this vein I was told by the Minister that the reason for these exemptions was based on the fact that this organization is considered to be a religious, charitable body. Anyone who examines the records in the Companies Branch of the Department of Secretary of State will find some very interesting information-information that caused a Cabinet minister some years ago to say that he agreed with my standpoint in this regard, because in his opinion this was a very sinister organization, organized to promote the cold war. I think if the Minister looks into this matter he will find that the largest contributions to this organization are made by large segments of industry interested in defence production. This is a matter that should be investigated.
I do not intend to say anything more in this regard at this time, except that I hope these remarks will be considered by the Minister. Various trade unions in my constituency, members of political organizations to which I belong and members of other organizations, have asked me to bring this matter to the attention of the House under the appropriate item, and that is what I have done at this time, because they object to this Moral Re-Armament organization receiving large exemptions on the ground that it is a religious or charitable group. The activities of this organization warrant a much more thorough and complete investigation than has
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been undertaken by the Minister of National Revenue or any official of the Government to date. This investigation should also relate to the source of this organization's funds and the purposes for which they are used. I am sure that anyone who knows the truth about this organization must realize that it is not a religious organization in the accepted sense of the word, and I would ask the Minister to inform us as to the basis on which it receives these large exemptions as being a charitable organization.
While we do allow exemptions to businesses, as I have mentioned, I think in many cases this involves an abuse. We allow exemptions to organizations such as the Moral Re-Armament group while at the same time we do not allow legitimate travelling expenses of individuals like many who live in my constituency, who have to travel 30 miles every day to their places of employment. I urge the Minister to give some consideration in this regard. Some consideration should be given to the living expenses of individuals who must maintain two homes because they are employed at logging and mining camps. There are no exemptions allowed under the existing system of taxation for these extra expenses. I think circumstances of this kind warrant further consideration by the Minister.
Having made these very mild criticisms I should now like to refer to paragraph 10 of the resolution. Subparagraph (b) of this paragraph relates to landscaping of property used by the taxpayer for the purpose of gaining or producing income. I think that is a pretty wide provision and, while as a Socialist I would expect all good capitalists of any size to be able to pay for this landscaping themselves, because of my love for beauty in all its forms, whether natural or otherwise, I would agree with this exemption with a certain amount of reservation.
Subparagraph (c) reads:
for clearing land or laying tile drainage for the purpose of carrying on a farming business,
I must say that I was very pleased indeed that the Minister included that exemption in his budget resolution. For 15 years I have risen in this House and argued that the farmer who brought land into production by clearing, by draining or by irrigation should be allowed the same exemption allowed to the owners of mines, or gas or oil wells. I am very pleased indeed that the Minister has included this exemption, and I know that the agricultural organizations in my constituency as well as the Canadian Federation of Agri-

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culture, the Farmers Union and all those interested in developing agriculture and increasing production, will welcome this exemption, which is actually only the granting ol that justice to the agricultural industry which has been denied for so many years.
I should now like to refer to subclause (d) which reads-
-as or on account of the cost of making representations to a government, municipality or other public authority in connection with a business carried on by the taxpayer, including representations for the purpose of obtaining a licence, permit, franchise, or trade mark,
I support this exemption in principle, but I envisage the risk, if it is not carefully policed, that there will be abuses. I think individuals who come here as delegates representing various organizations should be allowed to deduct their legitimate expenses. In respect to those who incur expenses in making representation, I should like the Minister to inform me whether it would be possible for a Member of Parliament who is a lawyer, to make representations to the Government on behalf of a client, the charges for which would be exempted as income of that client under the provisions of this subsection. I am going to make a speech on this question a little later on a much broader scale. But while the principle that it will benefit agricultural organizations, trade unions, business organizations and others with a legitimate expense incurred in presenting their views to the Government is correct, there is the possibility of this principle being abused, if it is not carefully policed. Knowing that others wish to say a few words on this resolution I will bring my remarks to an end at this point, but I may take an opportunity at a later date to add a few brief words.
[DOT] (8:50 pjn.)


Mr. More:: Mr. Chairman, in entering this debate it is not my purpose to hold up a decision on these resolutions, nor to repeat anything which has already been said. However, the last speaker raised a point about a certain organization, which I felt should not be allowed to go on the record unchallenged. I do not belong to this organization, nor do I hold any particular brief for it. I am referring to the remarks made by the last speaker about Moral Re-Armament.
He made certain allegations which would seem to disclose to this committee that in some way he obtained information from the Department of National Revenue about the source of income of this organization. As I
[Mr. Herridge.l
understand the Act the Department is not at liberty to disclose anyone's personal business in connection with donations that he may make, or that any company may make which are legitimate within the laws of the land. I challenge the hon. Member to produce evidence that what he stated-namely, that this organization is supported by munitions manufacturers and others-is indeed the fact.
Although I said, Mr. Chairman, that I was not connected in any way with this organization, I have had the opportunity to visit abroad various symposiums they have held and to meet and discuss problems with people from many countries of the world who have attended them. Although they still remain an enigma to me in many respects, and although for certain reasons I cannot directly join or support them, I still came away from these symposiums which I was privileged to attend with the feeling that this meeting together, and the influence the meetings had on the peoples from newly emerging countries, and others, were for the good.
I know that the hon. Member for Kootenay West and other Members of his group think that everyone should lie down and let Communism have full sway in this world; that it is not right to stand up and protect those things in which you believe. They say that we are the culprits in the cold war and that the other side is completely free from any blame. I do not accept this. The attack which the hon. Member just made on Moral Re-Armament, which I suggest is made without evidence, is similar to attacks which his group has been making on the Royal Canadian Mounted Police. Therefore I use this opportunity to bring this matter up, because I have not had a chance before to refer to these continuing attacks upon an organization which is without peer in the world. It is an organization which is almost completely unblemished. These attacks are bad for the country, and certainly do not help the morale of those in the organization, and their ability to do the job needed to be done in this country. In these attacks which are continually made, only one side of the story is given, and I am surprised that the Government and those responsible on that side of the House have not more vigorously refuted these allegations and stood up for this great organization.
Having said that, I want to refer to what I think is an omission in the resolutions now before the committee. Many exemptions are
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made and, for certain groups of people, have been enlarged in some respects. I believe the Minister and former Ministers have had representations from a group of people who are not what I would call large wage earners in our society. This group of people are engaged in an industry which gives very little scope for individuals with their qualifications to operate, which means they cannot classify themselves as businessmen and make the deductions which a private business operation is able to make. I am referring to the mechanics who work in the motor trades.
The fact is that most of the qualified mechanics who work in the motor trades are hired at an hourly wage. To meet the requirements of the job they are required to provide their own tools. In this day of modern automobiles these tools have become very sophisticated and expensive. Sometimes they become broken and sometimes lost. Yet these people are denied by the Government in our tax structure any consideration by way of deductions either for replacement of tools or depreciation, and I think this is a real oversight. I should like the Minister to confirm that these people have made representations to him in this regard.
I recall that not long ago the logging industry received some consideration in respect of power tools used on the job. If this is the case, then I would suggest that these mechanics, who work in a very competitive market and who do not, in my estimation, receive too large a wage for the knowledge and skills they have to acquire, should also receive consideration. I say to the Minister that if it is too late to do anything about it now, I would appreciate some assurance that these people will receive consideration the next time around.


Douglas Mason Fisher: Mr. Chairman, as someone on the Opposition side may I say I appreciate the work which has been carried on by the Whip or his assistant on the Government side in arranging for a substantial number of Government Members to be in the Chamber since eight o'clock. Before I move an amendment I want to refer to one item in the resolution which has already been touched on by my colleague from Kootenay West, and that is paragraph 10 (d) which relates to the cost of making representations to the government being a deductible expense.
I think it is about time we had some kind of legislation relating to lobbies and the cost of lobbying. I think the Minister should tell us whether it is envisaged that a group like Dominion Brewers, who maintain an
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office here and present reports at various times to the Government in connection with their operations, would qualify under this particular item. As I think everyone knows, lobbying on the federal scene is proliferating. I am not one of those who think it is something terrible, but it does seem to me that this particular item opens up all kinds of opportunities for underwriting the cost of lobbying. Therefore I think the Minister could tell us more about what is envisaged in paragraph 10 (d).
In connection with the Minister's remarks on budget night I want to draw his attention to a point which he made when he brought in the question of newspapers. He intended, or someone in the Government intended, to review the postal subsidy which, in effect, Time and Reader's Digest receive. All of us remember that last session the Postmaster General, the present Minister of Citizenship and Immigration, brought in a resolution to change the postal rate structure. As I remember that particular resolution it was not brought to fruition. A number of Members were against it, and one of the reasons was that which the Minister touched on, namely that we have no real idea of the scope and future prospects of the postal subsidy which certain publications in Canada have at the present time.
[DOT] (9:00 p.m.)
Since the Minister went to the trouble to refer to this in introducing the particular part of the legislation dealing with newspapers and periodicals, I think he or the Postmaster General is required by rules of fairness to tell us more of what is in the Government's mind. What does the Post Office Department know? I know the hon. Member for York-Humber was planning to speak on this matter, and he is one of the Canadian authorities on the question of postal subsidies and postal rates for newspapers and periodicals. From previous presentations he has made, I remember it is very clear that American periodicals coming into this country and the Canadian editions of Time and Reader's Digest have an effective subsidy that is not balanced in any effective way by any similar right that Canadian publications enjoy in the United States, because of a difference in the scale and the extent of publishing.
It seems to me it is not quite fair of the Minister of Finance to suggest that there may be some kind of adjustment here, when he is bringing in this resolution, that effectively naturalizes Time and Reader's Digest. I intend to move an amendment right after

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reading a letter I have received from the Weekend, Magazine group, the group I referred to before as the main group lobbying against Time and Reader's Digest having Canadian status. I received this letter on May 4, 1965. It is signed by Mr. Mark Farrell, managing director of Weekend Magazine. He says in his letter:
For the first time, we are close in this country to an effective answer to the problems of Canadian publications. The policy on Canadian ownership announced in the budget speech is a sensible solution to what is obviously a sensitive problem.
Why, then, does the Government destroy the logic of its position by making an exception of Time and Reader's Digest? We might as well attempt to fight an outbreak of typhoid fever by making an exception of Typhoid Mary.
By granting these two foreign magazines special privileges the Government has cut the heart out of its own periodical policy. The facts about Time and Reader's Digest are well known. Both are American owned and American controlled. Both serve not Canadian interests but American interests. Neither in the true sense of the world, is published in this country; they are only manufactured here. Both are dumping operations. Both have a minimum of Canadian investment.
Not only are they unfair and ruinous competition, but they cost Canada millions of dollars each year. We pay them between one and one and a half million dollars in postal subsidies each year. We bonus them to the tune of more than $200,000 by exemptions from sales tax. We give them lower postal rates than many Canadian publications. We hand them, and propose to continue doing so forever, wholly unearned profits adjustable at will by their parents in New York.
Why? Justice certainly has nothing to do with it. The presence in a community of a social wrong has never justified its continued existence: Freedom of the press is not involved. Time and the Digest would be as free to circulate in this country as every other foreign magazine.
Whatever the reason, it is time we faced up to it. If a pair of foreign magazines can claw a place for themselves in this country in defiance of our own interests, we might as well give up. But why should we allow them to do so? As a Member of Parliament, the solution lies in your hands.
He is appealing to Members of Parliament. I am going to move an amendment to strike out all of subsection 2 in the proposed new section 12A found in paragraph 19 of the resolution. I move:
That the resolution be amended by deleting therefrom subsection 2 of the proposed new section 12A of the Income Tax Act as set out in paragraph 19 of the said resolution.
Before you put the amendment, Mr. Chairman, I should like to anticipate the objection that this amendment will disturb the balance of Ways and Means. Neither I nor the Minister of Finance can really give the answer or comment on that point. What the amendment does is to remove effectively the provision which gives an exemption to Time and Reader's Digest. I am quite prepared to ac-

knowledge that it may affect the two foreign owned newspapers to which the Minister referred either in his budget speech or last night, and it may affect a paper in the constituency of the hon. Member for Red Deer, the Red Deer Advocate. But I suggest that if the amendment is put and accepted by the House it will be very simple for the Government to make an adjustment to subsection 5, dealing with the definition of what is a Canadian issue and a Canadian newspaper or periodical in order to take account of this particular point. In other words, Mr. Chairman, this amendment deletes that part of the resolution which effectively naturalizes or Cana-dianizes Time and Reader's Digest for all time. I think the amendment should appeal to many supporters of the Government who I know have been concerned about this matter just as we must assume the Minister of Finance was last year.


Lucien Lamoureux: Before the Chair puts the amendment proposed by the hon. Member for Port Arthur, I should say I have given this matter some thought for a few minutes and, as the hon. Member for Port Arthur himself pointed out, there is serious doubt whether the amendment is acceptable from a procedural standpoint. Perhaps hon. Members might like to offer comments on this particular point for the guidance of the Chair.


Walter Lockhart Gordon: Mr. Chairman, speaking personally, while I am not unsympathetic to the general objectives put forward by the hon. Member for Port Arthur on this occasion, I do think that to accept it would create a precedent which simply could not be accepted by any Government. As you intimated, Mr. Chairman, the hon. Member for Port Arthur himself has in effect made it quite clear that this amendment is out of order.


Douglas Mason Fisher: Oh, no, Mr. Chairman. My point was that I did not know-


Some hon. Members:: Order.


Douglas Mason Fisher: I am speaking to a point of order.


Lucien Lamoureux: Order. Do I take it that the hon. Member is rising on a point of order?


Walter Lockhart Gordon: As I said, Mr. Chairman-


Lucien Lamoureux: Order please. I do not want to deprive the hon. Member for Port Arthur of the right to raise a point of order, if this is what he wants to do now.
[DOT] (9:10 p.m.)


Douglas Mason Fisher: No, I will let it go, I just objected to that interpretation of my remarks.
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Walter Lockhart Gordon: Well, I will repeat it. As I interpreted the hon. Member's remarks, and as I think the Chair certainly indicated he did, there seemed to be at least a suspicion in the mind of the hon. Member that his amendment was out of order. I may be challenged on this, but I have noticed in this House that some of those who pride themselves on their knowledge of the rules are the ones who are inclined to break the rules most often.


Reid Scott: Thank you, Mr. School Teacher.


Walter Lockhart Gordon: I would suggest, Mr. Chairman, that this amendment is out of order because if it is interpreted narrowly, at least it does suggest that a Member of the Opposition can move an amendment which, in effect, would raise taxes or have the effect of raising tax revenues. As the hon. Member from Port Arthur suggested, the amendment certainly does raise the question of the balance of Ways and Means. His earlier suggestion that there should be a free vote on this budget proposal is quite unacceptable.


Mr. Winch:: Caucus rule.


Walter Lockhart Gordon: This is a proposal which the Government has put forward after considerable thought, and the Government-


Reid Scott: Tell us your true views.


Walter Lockhart Gordon: -will stand by it. To do otherwise would leave any government in any parliament in an impossible position. No one would know where anybody stood on anything.


Lucien Lamoureux: Order, please; is the Minister arguing the merits of the question now or the point of order?


Gilles Grégoire: You should respect the rules, too, you know.


Walter Lockhart Gordon: I do not know them as well as you do.
I think perhaps I have made it clear that this amendment is obviously out of order. If my hon. friend feels strongly about it, I suggest that when the resolution comes up for decision he will have an opportunity to vote against it. So far as the Government is concerned, the Government will stand or fall on the resolution before the House.


Douglas Mason Fisher: In speaking to the point of order, I want to make it clear that the point I was raising with regard to the question of whether or not the amendment disturbs the balance of Ways and Means is something to
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which I cannot give an answer, and neither can the Minister of Finance. This is simply a deletion. I should like to put it to you that if all we can do in terms of amending a resolution of this kind is to vote against a particular clause of a resolution, then we have not any function at all. If you cannot go so far as to delete something you consider obnoxious, then we have no function.
There is more to this particular item, Mr. Chairman, than the question of taxation, and the Minister is very much aware of it. This is a way of naturalizing something by a taxation mask or device.


Lucien Lamoureux: Is the hon. Member arguing the point of order?


Douglas Mason Fisher: Yes, Mr. Chairman, I am arguing against the interpretation advanced by the Minister of Finance in his comments on the point of order. He said that, in a sense, I had expressed doubt about the procedural legality of this move.
There is one other point I want to mention. The Minister made a personal aside. I should like to make the point to him that it is the hon. Member for Winnipeg North Centre who takes pride in being the procedural expert, and we take pride in that too. I do not know to what other hon. Member he was referring. I never claimed to be any procedural expert.


Mr. Muir (Lisgar):: You have none over there, either.


Douglas Mason Fisher: It seems to me the point of order you must decide, Mr. Chairman, is not whether or not this amendment affects taxation revenue, whether up or down. It seems to me that cannot be determined by trying to interpret the effect of this deletion. I am arguing, Mr. Chairman, that you have to make up your mind as to whether a Member of the Opposition or any Member of the House has a right to make deletions from proposals or resolutions that come before us. I am not convinced by the arguments put forward by the Minister. I hope if you are going to decide you cannot put this particular amendment, that at least you will secure from someone on the Government side some argument a little more convincing than the one given to us by the Minister of Finance.


Stanley Howard Knowles: Mr. Chairman, may I say just a few words on the point of order? I freely admit that it is a difficult situation in which the Committee of Ways and Means

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finds itself when we have a one-shot resolution with 18 or 20 parts. I also recognize the argument that private Members cannot move amendments that alter the balance of Ways and Means or appear to impose taxation. However, I should like to point out two things, and one has already been suggested, namely that we do not know whether or not the amendment will alter the balance of Ways and Means.
The other point I should like to make is that in this resolution, in paragraph 19, we have something put before us in rather unusual form. Usually income tax resolutions suggest in general language what is to be put in the actual amendments to the statutes. However, in this case there is set out in paragraph 19, not a general statement, but the precise wording that it is proposed to put in the bill that will be brought before us when this resolution passes. When we get to the bill itself, and in particular when we get into committee on the bill, we will be in a different situation. We will then have the individual clauses before us. At this point we have one resolution with 19 paragraphs. Because of a ruling that was made back in 1948, we are not allowed to vote on the individual paragraphs. When we get into Committee of the Whole on the bill itself, we will be entitled to vote on the individual sections as they come before us. If this section 12A is going to be written into the Income Tax Act as a clause in the bill, then we will be able to vote on that question by itself. As a matter of fact, when that clause is before us it is my view we will be able to move an amendment to delete any part of that clause. It strikes me it does not make sense to say at this stage that we cannot vote against a portion of what the Minister has placed before the Chamber, but that in Committee of the Whole, after second reading of the bill, we will be able to vote against a portion of what the Minister will place before us at that time. For this reason I suggest Your Honour ought to look more closely at the amendment.
[DOT] (9:20 p.m.)
The hon. Member for Port Arthur has not moved any alternative. He has not proposed any form of words of his own. What he has proposed is a means whereby we can vote for a deletion of something the Minister has proposed, something we will be able to do later on when in Committee of the Whole on the bill, and I think we ought to have the same right now just by the rule of common sense.


Paul Joseph James Martin: Mr. Chairman, I am sure Your Honour is familiar with citation 263 (2) to which my hon. friend who has just spoken has not made any reference. It reads:
"The principle that the sanction of the Crown must be given to every grant of money drawn from the public revenue, applies equally to the taxation levied to provide that revenue. No motion can therefore be made to impose a tax, save by a Minister of the Crown-
This we all agree.
-unless such tax be in substitution, by way of equivalent, for taxation at that moment submitted to the consideration of Parliament;-
I should think this is the governing factor.
-nor can the amount of a tax proposed on behalf of the Crown be augmented, nor any alteration made in the area of imposition.
I suggest we are all familiar with attempts that have been made from time to time to eliminate a particular form of taxation. In the debate last Parliament, when an attempt was made to eliminate the excise tax on particular commodities, it was held to be outside the capacity of anyone but a Minister of the Crown to move such a motion. This clearly is a proposal for an alteration of a tax made in the area of imposition. For this reason I would submit to you, as has my colleague, the Minister of Finance, that this proposal is not within the capacity or authority of any Member to make.


Lucien Lamoureux: Order. The Chair wants to express its appreciation and gratitude to hon. Members, particularly to the Secretary of State for External Affairs, for their learned contributions to the point of order raised by the Minister of Finance. In the opinion of the Chair the amendment of the hon. Member for Port Arthur, if adopted, would have the effect of increasing the burden of taxation on certain taxpayers who otherwise would be entitled to certain deductions for income tax purposes.
I believe it is well known to hon. Members that when an amendment proposes to set aside a measure designed to provide relief, that amendment in effect imposes a tax and should not be accepted by the Chair. Citation 265 (1) of Beauchesne is relevant:
No Member other than a Minister of the Crown may introduce a Bill for the reduction of duties.
In the interpretation of the Chair this would be the effect of the amendment moved by the hon. Member for Port Arthur if it were accepted by the committee. The citation further reads:

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The Government must take full responsibility for the taxation levied to provide the revenue.
I also refer the hon. Member to citation 269:
No augmentation of a tax or duty asked by the Crown can be proposed to the committee, nor tax imposed, save upon the motion of a Minister of the Crown-
I am not unaware of the difficulties raised by the hon. Member for Winnipeg North Centre but I feel it is the duty of the Chair to be bound by the relevant citations, which in this case are 269 and 265(1) of Beauchesne. In the circumstances, with regret I cannot accept the amendment moved by the hon. Member for Port Arthur.


Douglas Mason Fisher: I am not going to argue with your ruling, Mr. Chairman, but I am going to make the point that there is something fundamentally underhanded and sneaky about the way this particular matter has been introduced into this question, because every Member knows that this is not a question of taxation. This has nothing to do with taxes.


Some hon. Members:: Order.


Douglas Mason Fisher: This has to do with a fundamental matter in connection with two particular periodicals, something that spreads far beyond taxation. Hon. Members are shouting order. I do not know why they feel they have to substitute for you as a Chairman, but if they feel there is a point of order let them get up and say so.


Lucien Lamoureux: Order please. I submit to the hon. Member that there is a point of order, that the Chair has given its interpretation of the amendment moved by the hon. Member and has ruled in the light of this interpretation. I would suggest to the hon. Member that he knows the ruling cannot be discussed.


Douglas Mason Fisher: I accept the ruling, but these remarks are for the benefit of the Minister of Finance, who was so kind as to tell us he was generally sympathetic, personally, with the intention that I may have had in mind in moving that particular amendment.
I am speaking generally now on something that has bothered a great many people in this country, and that happens to be the persuasive influence and the views of these two particular publications within this country, and their influence upon two successive governments. This is a very bothersome matter. I think most Members who feel the way I do, do not have any particular antagonism
Income Tax Act
toward Time and Reader's Digest as such, as magazines. In fact I would probably be one of the first to buy Time or Reader's Digest -Time at least-as an American edition coming into the country, such as the Saturday Review of Literature, Newsweek and magazines like that.
But this is a bogus situation. These are bogus Canadian magazines, and supporters of the Minister and the Government need to realize that what they are doing by supporting this resolution is Canadianizing bogus Canadian organizations. The point that Members who support the Government should consider, if they vote for this particular resolution, and particularly if they vote for this section of it when it is embodied in the bill, is that when they vote it will be for something introduced by a Minister of Finance who did not have the courage to come clear and clean and spell out Time and Reader's Digest.
This is a complicated resolution. It takes almost two pages in Votes and Proceedings to circle around the particular point of Time and Reader's Digest and to cover the rather simple point in connection with Canadian newspapers.
I hope other hon. Members feel what the hon. Member for Red Deer has felt, a sense of outrage that this Government and this Minister, after all the parading about Canadian nationalism, after all the talk they have given to us about being free, should stoop to this.


Some hon. Members:: Hear, hear.


Douglas Mason Fisher: I wonder whether Members realize how easy it is to get sick of a Government that has a Prime Minister going around talking about the new politics, that has a Minister like the Minister of Forestry going around telling everybody to clean up, to get with the new times, to get with the new politics. I wonder whether hon. Members realize how easy it is to get sick of a Government which has a Minister of Finance setting forth policies in his budget speech and in his introduction to the Canada Development Corporation, about Canadianism and Canadian nationalism, and then see the Government come up with a device, a measure like this.
Cabinet Ministers will not even lay it out clear in the open. They are sneaking it through without even mentioning the names.
I think it is only right and proper that I, and other Members who feel strongly about this, should make the point, and make it

June 15, 1965
Income Tax Act
good and clear, particularly to those supporters of the Government who, in my mind at least, had given us hope that there was a real, genuine, pervasive Canadian nationalism on that side of the House.
[DOT] (9:30 p.m.)


Walter Lockhart Gordon: After listening to those rather ill-tempered and intemperate remarks by one of the most intemperate Members of this House-


Some hon. Members:: Oh, oh.


Walter Lockhart Gordon: I do not know where the hon. Member was last night but I should like to remind him that I mentioned Time and Reader's Digest by name two or three times in the statement I made on this particular clause of the resolution. I am not used to being called cowardly and I do not accept it from the hon. Member for Port Arthur.


Some hon. Members:: Hear, hear.


Walter Lockhart Gordon: While we are indulging in personalities I may say I resent very keenly the scurrilous remarks which the hon. Member made about the Prime Minister of this country-


Some hon. Members:: Hear, hear.


Walter Lockhart Gordon: -and which he feels free to indulge in in his other occupation as a so-called columnist.


Some hon. Members:: Oh, oh.


Douglas Mason Fisher: That is a great answer.


Thomas Clement (Tommy) Douglas: That dealt with the question all right.


Gilles Grégoire: A bad argument.


Lucien Lamoureux: May we have order in the Committee?


Marcel Joseph Aimé Lambert: I am afraid the Minister of Finance may have been carried away during what I might call his somewhat childish protest, if I may be kind. When it comes to addressing a lesson to the hon. Member for Port Arthur and others regarding their comments on the conduct of the Prime Minister perhaps he would take aside his colleague the Minister of Public Works and remind him of his past sins in this regard. We remember bitterly certain remarks by that hon. gentleman-


Lucien Lamoureux: Order. May I remind the hon. Member for Edmonton West, the Minister of Finance and the hon. Member for Port Arthur that it may be advisable now to

abandon personal allusions and return to the subject before the Committee.


Marcel Joseph Aimé Lambert: Sometimes when things have been said with apparent freedom they may be commented upon. I was commenting upon some of the words of the Minister of Finance. In these circumstances the Chair is sometimes placed in a little difficulty but we hope that good sense comes back.
As far as the resolution itself is concerned there are certain features in it which we are prepared to accept. There are others which we are not prepared to accept. It is one of the rules of this House that when an omnibus resolution of this nature is placed before us covering the whole panorama of taxation amendments it has to be accepted or rejected as a whole, though some features are acceptable and others are not acceptable.
I will make my stand on paragraph 1 known at the appropriate time where it appears in its own context. With respect to paragraph 19, of course I object to it. Therefore it is my intention to vote against the resolution. I am not in these circumstances to be considered as objecting to paragraph 1.


Some hon. Members:: Question.


Lucien Lamoureux: Is the committee ready for the question?


Stanley Howard Knowles: I think there is some misunderstanding about what you are asking, Mr. Chairman. Are you suggesting that the debate is over on the resolution, or that the discussion on the first paragraph is over?


Lucien Lamoureux: The request of the Chair was to ascertain whether the committee wanted to vote on the resolution. If the committee is ready to vote on the whole resolution at this time the question will be put.


Stanley Howard Knowles: I understood a certain amount of general discussion would be allowed and that there would then be an opportunity to discuss the separate paragraphs even though a vote would not be permitted on those paragraphs. I wanted to say something on paragraph 5. I will say it now if necessary, but I would rather do it in orderly fashion as we get down to the paragraphs.


Some hon. Members:: No.


Lucien Lamoureux: If it is the wish to discuss each paragraph separately that could be done as it has been done before.


Mr. Canielon:: I have some remarks to make along the lines of those made by the hon. Member for Regina City. They have to do
June 15, 1965

with mechanics and the fact that no depreciation allowance is made to them with respect to the tools they own. This is a most unfair situation because the shops in which they work are allowed depreciation in respect of the tools used in those shops. We know that shop foremen are allowed depreciation in respect of the tools they own. Yet ordinary auto mechanics are not allowed to set depreciation against their income tax, though the tools they own may be worth between $700 and $1,000. Obviously they wear out and at present there is no way of recovering the loss. I would direct this matter to the attention of the Minister of Finance.


Mr. Winkler:: I should like to say a few
words about the first paragraph concerning the income tax exemption currently being considered and made to apply as of July 1. The Government has suggested to the people of Canada that it is greatly concerned about poverty, and anticipates declaring a so-called war on poverty.
Well, in actual fact, judging from the way this legislation goes, this appears to be a war on the poor. It is obvious that those with high incomes will receive the greatest benefit while those in the lower income brackets will be discriminated against. Considering the inflationary trends which are apparent within the country today I say that the war on poverty is working in reverse, as is apparent from paragraph 1.
[DOT] (9:40 p.m.)
Let us now consider paragraph No. 4 regarding the cancellation of the $500 tax exemption for individuals at age 65. This is another way of taking money away from those people at a time when they need it most, leaving them in a fixed income tax bracket, regardless of whether the extra income is derived from a private pension, an industrial pension or a professional pension to which the individual taxpayer had contributed.
The point I am making in this regard is, of course, an obvious one. At the same time the Government speaks of a war on poverty, by these provisions it is proposing a $600 per year benefit to individuals earning higher salaries and disregarding those people in lower income brackets. They are attempting to remove the tax exemption of $500 in respect of people age 65 and over. This will be a serious blow to those people, particularly in times of inflation, and there is an apparent trend of this kind. I think there is something wrong in the attitude of the Government in their projection of this measure, particularly
Income Tax Act
when one considers that they have refused on a number of occasions a request by Members of the Opposition to have old age security increased to $100 at age 65.
When we think of the Government giving this money to people in the higher income tax brackets and disallowing it to people at age 65, and when we think of the 11 per cent sales tax imposed on building materials, we are led to believe that the people of this country are being hoodwinked in regard to taxation. I am afraid that the Members of this party will find themselves in the position of having to vote against this measure because of these irregularities in Government policy.


Maurice John Moreau: Mr. Chairman, would the hon. Member care to inform the House how much the $100 pension at age 65 would cost, and how he would propose to raise that amount?


Eric Alfred Winkler: We have gone over that ground already. I do not know what the attendance record of the hon. Member is, but had he been around often enough and listened carefully enough to the amendments put forward at the time we were discussing the Canada Pension Plan he would know precisely what I am referring to. I do not intend to go back over that debate again. He knows perfectly well that this could have been done without any increase in taxes. By putting forward the view he has now expressed I am sure that he is limiting his opportunities for re-election in his small riding.


Maurice John Moreau: At least I have a riding.


Eric Alfred Winkler: It seems that the Grits always look after their own in some way or other, and it is always the Tories who suffer when the Grits are in power.


An hon. Member:: That is pretty small talk.


Eric Alfred Winkler: That may be so, but the hon. Member for Scarborough knows very well that a Liberal is a Liberal, and that if his constituents are smart and listen to what I say his chances will be much slimmer the next time round.
Let me say in conclusion that if the Government could tell us in common sense terms that they are doing something really substantial in the war on poverty through the measure now before us, we would support it, but because we can see nothing but conflict and Liberal politics involved, we on this side of the House will have to vote against the measure.


Douglas Mason Fisher: I should like to ask the Minister whether he could give us some more information than he has given about the

June 15, 1965
Income Tax Act
amendment to the income tax regulations, in so far as pollution is concerned, that he hinted would be forthcoming. Would he also answer the question raised by the hon. Member for Comox-Alberni about air pollution, particularly in respect of the pulp and paper industry. Will there be something in the bill that will be forthcoming in this regard and, if not, what kind of information are we going to get as to the actual change in the income tax regulations that will be presented.


Walter Lockhart Gordon: Mr. Chairman, I said in the budget speech that faster write-offs would be allowed for people who spent money on antipollution projects. This will be dealt with in the regulations to the Income Tax Act but not in this resolution or in the bill which follows it. I am sure when the regulations have been worked out in detail-first of all they will be published in the Canada Gazette -that my colleague the Minister of National Kevenue will give the appropriate explanation. In my humble opinion this is not the time for such an explanation.


Douglas Mason Fisher: I am wondering to which item now before us the changes in the regulations would relate, and if that-


Walter Lockhart Gordon: They do not relate to any of the items.


Douglas Mason Fisher: Mr. Chairman, will you call the items because I intend to attempt to bring this subject before the committee in relation to item No. 10.


Marcel Joseph Aimé Lambert: Mr. Chairman, the hon. Member for Acadia referred to these matters relating to the regulations before the dinner hour, and to fast appreciation on farm grain storage facilities, and increased depreciation in respect of pollution projects. I should like to know why it was decided to do this by regulation rather than by direct provisions within the Act.


Walter Lockhart Gordon: Mr. Chairman, I am delighted to answer that question. Everything related to capital cost allowances, including different rates of write-offs, are provided for in the regulations and not in the Act as special items.


Ralph Bronson Cowan: Mr. Chairman, in rising at this time to speak on the resolution I wish to direct my remarks particularly to clause 12A, which is that part of the resolution having to do with the newspaper and periodical industry. In commenting on this subject I should like to emphasize that this has been my life, and if I should be rejected in any
CMr. Fisher.j
future election I shall return to this business, about which I believe I know something. The hon. Member for Port Arthur was kind when he suggested that I was an authority in this field and I thank him for that reference, but let me say that I would not make that suggestion.
The question relating to Time magazine and Reader's Digest in this country is something which has received a great deal of attention, particularly since the O'Leary report was presented in 1961. However there are other facets of the game which should be considered before precipitate action is taken whereby naturalization is granted to these two magazines which have been established in this country, at least in the case of Time magazine, for about three years, particularly when one considers that it takes five years residence in Canada for a human being to become naturalized.
The interesting thing about foreign ownership of Canadian periodicals is this. I subscribe to at least ten foreign-owned magazines printed in Great Britain and the United States of America. I read the New Republic, of the United States, as well as the New Statesman and Nation of Great Britain regularly. I subscribe to United States periodicals, British publications, and to one French paper, and I have done so for many years. Is there something the matter with my reading a foreign-owned periodical when it comes into the country openly, when anyone can read it and know its contents?
[DOT] (9:50 p.m.)
It is stated that it would be bad for Canadian newspapers to be owned by foreigners. I am not going to argue the point one way or the other. But no matter who owns the paper, does not the reader of the periodical make his own judgment as to the ideas being advanced in the periodical? I have read magazines which have been published in Germany on technical aspects of the printing trade, and I think no less of them because they are owned and printed by a firm in Germany than I would of the finest printing trade publications printed in Canada or the United States of America. The fact that a publication may be foreign-owned is certainly nothing to be held against the publication, unless one is so weak-minded that he cannot form a conclusion of his own. The idea that you should not be able to read a newspaper printed in Canada which is owned by foreign interests runs counter to the fact that you can buy books printed in
June 15, 1965

Great Britain, printed in the United States, printed in Germany, printed in Australia, bring them into Canada and read them. Or are we soon to have laws which say that you cannot read books in Canada unless they have been printed in Canada? I hope we are not living in a hot-house economy in this held.
To grant naturalization to two United States-owned periodicals such as Time and Reader's Digest will be a body blow to the Canadian consumer magazine industry. At the present time those two magazines are taking from the advertising agencies and the few direct advertisers who are left, something over 54 per cent of the total amount spent on advertising in consumer magazines.
I am of an age that I can recall Canadian magazines which are no longer in business but have gone the way of all flesh, due to competition. I can remember the Canadian Courier. I remember when Saturday Night was a weekly publication. I remember when Maclean's magazine was a weekly publication. I can remember when the Montreal Standard was a great and strong publication under Lord Atholstan. Today the Montreal Standard is perpetuated in the form of Weekend, which is a gravure supplement appearing in a large number of Canadian newspapers. It is making a handsome profit on its present operation but has had to change its entire format to remain in business.
I can remember when Canadian Homes and Gardens was a separate magazine but could not meet the competition of those that the hon. Member for Port Arthur called bastard editions, if I may quote him; and if he is out of order we can both be ruled out of order. Now Canadian Homes and Gardens is a gravure supplement with the Southam chain. It is a pretty fine publication today, but it is not an independent magazine.
This question of allowing these bogus Canadian papers to continue on with the blessing of the Government has to be faced. Are we going to have a Canadian magazine industry, or are we going to have bogus publications dominating the field? The O'Leary Commission recommended that Time and Reader's Digest be taxed in a certain manner, one which would discourage advertisers from patronizing them. Senator O'Leary, who is a very much respected man in the publishing world, knows the business. At the time of the report he was President-Publisher of one of our great Canadian daily newspapers and familiar with the problems of publishing in this country. This is shown by
Income Tax Act
the fact that the owners of the periodical of which he was President-Publisher and chief shareholder found it advisable to sell the publication to a much stronger organization, F. P. Publications, who are turning out the paper today.
I do not know whether or not the Members of this House favour individual ownership of newspapers as compared with chain ownership. I personally favour individual ownership. But the competition which is arising in the magazine and publishing industry in this country is such that it almost appears that no one can stand on his own feet, even in the daily newspaper field in Canada unless he has chain support.
Reference has been made during this discussion to the Thomson chain. I have a brother working for the Thomson chain. Reference was made to the McGraw-Hill trade publications. I have a brother, now a naturalized United States citizen, who has been working for McGraw-Hill publications in New York since his graduation from the University of Toronto in 1948. Reference was made to the Toronto Star Weekly by some speakers today. I have a third brother who works for the Toronto Star Weekly.


Mr. Cyr:: Keeping it in the family.


Ralph Bronson Cowan: I believe that with the connections I have in the publishing field I know all the facets of it viewed from any side. In answer to the hon. Member for Gaspe I might say that I even have a daughter who is at present working for the Toronto Star.
With regard to Time and Reader's Digest this is a problem which is faced by no other nation on earth. The United States of America is a nation whose people speak the English language, read the English language and are educated in the English language. In Canada there are 19 million people whose predominant language is English. The largest portion of the population reads English and the largest portion of magazines read are published in English. It is possible for publishers in the United States to try to invade the Canadian publishing market by issuing these bogus editions and soliciting advertising in Canada which is the lifeblood of the magazines. This is done, as far as the United States is concerned, in a foreign country. You do not run into a situation where publishers in France publish editions in Spain, or where publishers in Denmark publish editions in Germany, or where publishers in Sweden publish editions in Russia, because the editorial content of the French publication is in

June 15, 1965
Business of the House
a different language from that spoken in Spain, and so on. But here on the North American continent there is a publishing enigma which is not faced by any other two countries in the world, and so I believe a separate direct method of treatment is required to handle such a situation.
To allow the United States publications to come into Canada and solicit advertising without let or hindrance is a serious matter to Canadian publishers. We talk of the "brain drain" from Canada to the United States. I believe there are a large number of well educated and very capable people continuously emigrating to the United States, and I should like to illustrate how the term "brain drain" originated.


Lucien Lamoureux: Order. It being ten o'clock, shall I rise, report progress, and request leave to sit again later this day, or at the next sitting of the House?


Some hon. Members:: Agreed.
Progress reported.



BUSINESS OF THE HOUSE

Mr. McNaughl:: Mr. Speaker, tomorrow we will continue the budget resolution. If they should be concluded we will then take up item No. 10 on today's order paper, resuming the debate on the motion of the Minister of Justice to set up a joint committee on penitentiaries, followed by item No. 21, the resolution preceding the Fisheries Improvement Loans Act, and item No. 22, the resolution preceding a bill to provide for the construction of the Canadian National Railways line at Froomfield spur near Sarnia. Then if we have time we will consider Supplementary Estimates A, relating to the Department of Labour, payments under the winter housebuilding incentive program. These estimates were tabled on May 18.
[DOT] (10:00 p.m.)


Michael Starr: That is a longer program than the Prime Minister announced.


Marcel Joseph Aimé Lambert: On a point of information, Mr. Speaker, in what order will the budget resolutions be called? Will the Customs Act resolution or the Customs Tariff resolutions be first?


John Watson MacNaught: The Customs Act will be first.


Marcel Joseph Aimé Lambert: And then the Customs Tariff resolutions?


John Watson MacNaught: I am informed that is correct.



PROCEEDINGS ON ADJOURNMENT MOTION

[Stage Direction]
A motion to adjourn the House under Provisional Standing Order 39A deemed to have been moved.

David Orlikow: Mr. Speaker, I wish tonight to raise the question of the treatment of narcotic addicts by doctors. I do so as the result of a report that appeared in a Toronto newspaper last week that a doctor in Etobicoke was being harassed by the chief of the Federal Narcotics Control Division of the Department of National Health and Welfare. An article in the Toronto Star of June 4 quotes the doctor as alleging that the chief of the Narcotics Control Division "is trying to interfere with anyone who treats narcotic addicts because he is afraid that we may show his department up".
The doctor referred to the fact that he has been treating a narcotics addict who has spent most of the last 20 years in jail for illegal possession of narcotics as well as for theft, in order that this addict may get the narcotics he required at a cost of about $100 a day. The doctor's statement has been confirmed in a letter to the Minister of National Health and Welfare (Miss LaMarsh) from the director of the Anglican Correctional Chaplaincy for the Diocese of Toronto, the Reverend S. G. West.
According to the doctor, this patient, one of a number whom the doctor has been treating, has been able to stay out of trouble to stay out of jail and to refrain from theft since he has been treated by him. The director of the Narcotics Control Division of the Department of National Health and Welfare has written to the doctor as follows:
The Department of Health and Welfare has no desire to interfere with medicine in the treatment of drug addiction so long as it is within the concept of good medical practice.
The Government and the Department talk frequently in another context about not interfering in the doctor-patient relationship, but there we have a classic example of Canadian practice in that the treatment for drug addiction is being decided, not by the doctor, not by the medical profession but in fact by the Government, by the enforcement officers of the Department along with representatives of the Royal Canadian Mounted Police.
June 15, 1965

This question was discussed in a recent issue of the Canadian Medical Association Journal and it was stated that it would be better and safer on the whole for doctors to stay away completely from treating addicts. What we are faced with in Canada is a policy which we do not admit exists because we have adopted the very pleasant and safe habit of ignoring all problems. The policy is that if you do not talk about these problems and sweep them under the rug people will be convinced they do not exist.
We have been following the same policy as the United States for the last 50 years in trying to deal with the problem of drug addiction. We have declared drug addiction to be a crime. We have followed the policy of believing that the crime can be eliminated or at least controlled by being ever harder, ever tougher on drug addicts, by watching them by keeping them under the closest surveillance by methods which can only be described as being part of a police state.
It is not my intention to discuss that aspect tonight. We can put the methods on the record on another occasion. This policy has been as complete a failure in Canada as has been a similar policy in the United States, in so far as reducing the number of addicts is concerned. Now, the medical profession, and this doctor in Etobicoke so far as I can find out, have been attempting to experiment with methods which have been used so successfully in Great Britain for a number of years. These methods have been described and explained in Canada by people in recent years, one of whom was Lady Franklin. I am suggesting to the Minister and to the department that they stop working so closely with the Royal Canadian Mounted Police and stop following the police mentality and police methods. They should give the doctors a chance. They should give an opportunity to a few doctors in Canada who have not been harassed, who have not been browbeaten and who are not afraid to try this treatment. They should be given a chance to use medical methods of treatment. They should be given a year or two, whatever is required, so that they would be able to treat these persons as successfully as they have been treated in Great Britain. Then, we may well evolve a policy which may work, in contradistinction to the methods which we have used up until now and which have been a complete failure.
Proceedings on Adjournment Motion


John Carr Munro: Mr. Speaker, after the hon. Member raised this point I referred him to the position taken by the Department with respect to this Etobicoke doctor, and to the Department's feeling that any inference they were interfering with the right of a practitioner to carry on his practice was resented by them. They point out that, in the first place, the narcotics legislation was brought directly in line with the comparable British legislation as regards the right of a doctor to treat narcotics addicts and utilize narcotic drugs in such treatment. The hon. Member has just referred to the British system.
The department has been prepared to give full support to any doctor who undertakes the usually thankless task of treating drug addicts. At no time has the department sought to interfere with the doctor's efforts in this difficult area. The department added that the purpose of treatment in any medical sense is to lead to the reduction of an addict's daily drug requirements and eventually to his ability to abstain completely from reliance on drugs. They do not regard substantial increases in daily requirements as constituting treatment in any medical sense.
I suppose what drew the matter to the attention of the department in the present case was the substantial increases in the quantities of narcotics purchased by the doctor in question. He was asked for an explanation, as is provided under the authority of the legislation. When the explanation was given it became apparent that the daily requirements of the addicts under treatment were progressively increasing over a given period. In the case of one at least, the increase was six times the amount he was being given initially. This was drawn to the attention of the physician, with the suggestion that if he co-operated along the lines recommended by the Canadian Medical Association, there would be no further need to correspond, nor would any further difficulty occur. It is my understanding that the physician has agreed to do so. The physician himself has indicated that he will follow the suggestion of the Deputy Minister, Dr. Cameron and that he will work with these patients through the Alcoholism and Drug Addiction Research Foundation of Ontario. He is most happy to comply with that suggestion.
June 15, 1965
2476	COMMONS
Proceedings on Adjournment Motion
[DOT] (10:10 p.m.)



ADMINISTRATION OF JUSTICE-REVIEW OF CRIMINAL CODE PROVISIONS RESPECTING BAIL

Reid Scott: Mr. Speaker,
I rise tonight to voice a plea for the very large number of Canadians who are grossly discriminated against and unjustifiably imprisoned when they are charged with offences and not permitted bail.
Last September 17 our Minister of Justice told me that he was preparing a review of the Criminal Code and that among the items under review would be the question of bail for those in custody. The other day, on June 14, I had thought that after nine months that would have been a sufficiently long time for him to have given birth to some new ideas in this field, and I questioned him about it. But in response to my question he informed me that the whole matter was now to be relinquished and assigned to the special committee.
My indignation was prompted by a series of articles by Martin Friedland, appearing in the Globe and Mail, in which he points out the very disturbing relationships between custody pending trial, and the outcome of the case, and the determination of the guilt, and the sentence imposed. For example he points out that 41 per cent of those in custody at trial were sent to jail as opposed to only 13 per cent of those released on bail. Some 79 per cent of those in custody received sentences of one month or more, while only 24 per cent of those allowed bail received such sentences. I have not time to go into the article more fully, but the point is that great injustice exists in Canada with respect to the whole question of bail.
When we raised this nine months ago with our Minister of Justice we thought we had a Minister of Justice who was going to take this matter seriously, who was going to speak out for the people for whom there is no voice, who was going to give some protection to these people for whom there is no one to speak. But we are fast learning that in our Minister of Justice we have a person who is long on promises and very short on performance.
He has had nine months in which to conduct his survey, to think about the rights of these accused people for whom there is no one to speak. He is the man to whom we look for guidance and leadership for these people, and from whom we have got nothing except this last promise, that the whole thing is to be
[Mr. Munro.l

swept under the rug and referred to this committee of experts.
I would have thought that at least out of some sense of humanity and justice he would have brought in some interim regulations which could be amended at a later date, but but that has not happened. These are our fellow citizens who are suffering this unjust discrimination. No doubt the Minister's apologist, the Parliamentary Secretary, will get up and fluff the whole thing off, just as the Minister has done himself.


Mr. D. S. Macdonald (Parliamentary Secretary to Minister of Justice):: Mr. Speaker, first I should welcome the hon. Member for Danforth back to the House. He and I had an assignment here last night on the question of parole but unfortunately he did not make it. perhaps because of the traumatic experience he has been going through as a result of the Ontario redistribution.
The hon. Member has said he is fast learning in this matter. Unfortunately he does not appear to have learned fast enough from his law school training and professional experience that the particular application of bail is a matter subject to provincial jurisdiction. Also, if he had read more closely the articles by Professor Friedland in the Globe and Mail he would have found that Professor Friedland's objection was not mainly on the question of the state of the law, but on its application; that he had pointed out that something like 94 per cent of accused in Toronto were being required to post bail rather than being made the subject of summonses, and that this latter procedure now provided in the code, was not being used by the provincial authorities, and more particularly by the police authorities in the City of Toronto.
As long ago as last January I had the opportunity of discussing with Professor Friedland the study on which he was engaged. I have arranged with him to get advance proofs of his study on bail in the Toronto area. I have also made arrangements for him to come down and talk to the officials of the Department of Justice on this important question. As Professor Friedland has pointed out, and as the hon. Member could find out if he read up on the subject with a little care, instead of trying to make a cheap political speech on this matter, the great problem is not with regard to the existing provisions of the Criminal Code or other related Federal statutes in this area, but it is with regard to
June 15, 1965	COMMONS DEBATES	2477
their application and enforcement by the provincial authorities.
I do not think anything useful can be added by the choirboy from Brome-Missisquoi. In this regard I would point out to the hon. Member that he might read with care Professor Friedland's study when it comes out-[DOT]


Mr, Graffiey:: What a pompous ass!


Mr. Deputy Speaker:: I would point out to the hon. Member for Brome-Missisquoi that the Parliamentary Secretary has the floor.


William Heward Grafftey: Such pomposity I have never heard.


Donald Stovel Macdonald: Only when the hon. Member for Brome-Missisquoi is speaking.


William Heward Grafftey: All the wit in the world.


Thomas Clement (Tommy) Douglas: You can leave, now. You have made your three minute speech.


An hon. Member:: Come back tomorrow at ten o'clock.



HEALTH AND WELFARE-INQUIRY AS TO NATIONAL MEDICARE PROGRAM

Stanley Howard Knowles: Mr. Speaker, I put a question on medicare to the Acting Prime Minister this afternoon. When the answer struck me as being not very satisfactory I suggested that it be posted for one of these overtime periods.
My question was prompted by the interesting announcement made this day, June 15, 1965, that we are going to have colour television in Canada in 1967. This was not only an interesting announcement; I am sure it will be very popular across the country. But it occurred to me immediately that if it is possible for the Government in 1965 to announce colour television some 21 months later it ought to be possible after all the years which have been spent studying the question of health insurance or medicare to make a similar announcement with respect to the intentions of the Government of Canada on this very important subject.
My question is a very simple one, a very narrow one. I did not enter into the whole subject of health insurance and I do not intend to do so tonight. It was this: Is it not possible for the Government some time this summer to make a clear announcement that it is intended to have medicare established in Canada by 1967, which happens to be our centennial year?
The Acting Prime Minister said my question would be given consideration. If by that
Proceedings on Adjournment Motion he meant that within the next few weeks the Government would consider the possibility of making an announcement parallel to the one which was made today, we in this corner of the House would be delighted. We are aware of the many years during which this matter has been under study, the many promises which have been made and all the election campaigns which have been conducted on this issue. Some of us are conscious of the reports which have been given us on this question-the voluminous report of a committee during the war years, for example. Then there was the Marsh report and the Green Books at the time of the Federal-Provincial Conference in 1945. There was the announcement made when we got hospital insurance that medicare, or health insurance as it was called then, was on the way. In the meantime many developments have taken place across the country. There is wide interest in the subject. Some of the provinces are now moving in a way which seems to some of us to be inadequate to meet the situation in accordance with recommendations of the kind made in the Hall report. We think it is a disservice to the people of Canada that this matter should be put off repeatedly.
The Liberals like to boast of the social legislation they have brought in during the years in which they have been in power. I suggest this is a piece of social legislation which should be put on our statute books. I ask the Government to subject itself to the discipline of making a statement as to its target date for medicare. I do not ask for a statement about the Government's interest in medicare and all it has done in the last 15 or 25 years. I simply ask that it give consideration to telling us before this House leaves for its summer recess, or, in the event that there is no recess, before this summer is over, that 1967 is the target year and that in 1967 we will get medicare. If this decision is put off again, year after year, we may have to wait a few more decades. We have waited 46 years already since the first promise of 1919. Surely that is long enough.
[DOT] (10:20 p.m.)
Television itself came in only a decade or so ago, yet now we receive an announcement that within 18 or 20 months we can expect to have colour television. I think the Government ought to accept the responsibility for making up its mind that the next social advance to be made, and this would be appropriate for the centennial year, will
June 15. 1965

Proceedings on Adjournment Motion be a Canadian medicare plan. I would ask the Government to consider seriously the making of an announcement before this House rises for a summer recess, or before the summer is over, in the event we do not have a recess, that it has decided definitely that we will have medicare in Canada by 1967.


John Carr Munro: Mr. Speaker, the Speech from the Throne is in effect a Government announcement, or at least that is its purpose. In that speech it was stated:
My government believes that public policy should be directed to improving the quality of health services and to ensuring that all Canadians can obtain needed health care, irrespective of their ability to pay. Accordingly my government will at an early date meet with the governments of the provinces in order to discuss with them the way in which federal and provincial action can most effectively contribute to programs that will provide health services to Canadians on a comprehensive basis.
As the hon. Member for Winnipeg North Centre already knows, a Dominion-Provincial Conference is to be held on June 19, and medicare is one of the items on that agenda. The Government has set out the principles it advocates in respect of medicare, and that it should be designed on a universal basis irrespective of the ability to pay. That is certainly an essential element of the recommendation contained in the Hall Commission report. The hon. Member also knows that the establishment of any medicare program requires the co-operation of the provinces, in view of the fact they have paramount jurisdiction in this field. Before any commitment as to a precise date can be made, discussions with the provincial authorities obtaining their feelings on the matter will have to take place. For those reasons it is impossible to predict the precise date of the adoption of a medicare plan.
The hon. Member suggests that such a plan should be put into effect by 1967. If we can obtain the agreement of the provinces so that the whole plan can be worked out in detail, with the implementation of certain of the Hall Commission recommendations, perhaps it can be implemented before that date. Surely the time factor must depend on successful conferences with the provinces, for the reasons I have suggested.
Motion agreed to and the House adjourned at 10.23 p.m.

Wednesday, June 16, 1965