1966-07-05

COMMITTEES OF THE HOUSE


[Stage Direction]
Mr. Patrick T. Asselin (Richmond-Wolfe)
presented the second report of the standing committee on standing orders.

[Stage Direction]
Mr. Joseph Macaluso (Hamilton West) presented the ninth report of the standing committee on transport and communications and moved that the report be concurred in.
Mr. Speaker:: Order, please. I understand that there is no recommendation from the committee which would require the concurrence of the house at this time.



PENITENTIARIES-FIRST REPORT OF SPECIAL JOINT COMMITTEE

[Stage Direction]
Mr. Ian Watson (Chateauguay-Huntingdon-Laprairie) presented the first report of the special joint committee on penitentiaries, and moved that the report be concurred in.
Mr. Speaker:: The hon. member will have to submit a motion in writing to the Chair.
[Note: Text of the foregoing reports appears in today's Votes and Proceedings.]



HEALTH AND WELFARE


Hon. A. J. MacEachen (Minister of National Health and Welfare):: Mr. Speaker, with the consent of the house I should like to table the correspondence requested by the hon. member for Kamloops.


Mr. Speaker:: Is this agreed?


Some hon. Members:: Agreed.
[DOT] (2:40 pm.)



INTERPRETATION ACT


Hon. Lucien Cardin (Minister of Justice) moved: the first reading of Bill No. S-9 (from the Senate) to revise and consolidate the Interpretation Act and amendments thereto, and to effect certain consequential amendments to the Canada Evidence Act and the Bills of Exchange Act.
Motion agreed to and bill read the first time.



CANADA LABOUR (SAFETY) CODE PROVISION FOR EMPLOYMENT SAFETY IN FEDERAL WORKS

Allan Joseph MacEachen: the first reading of Bill No. S-35 (from the Senate) respecting the prevention of employment injury in federal works, undertakings and businesses.
Motion agreed to and bill read the first time.



LABOUR RELATIONS


[Stage Direction]
On the orders of the day:
Right Hon. J. G. Diefenbaker (Leader of the Opposition):: My question is addressed to the Prime Minister. Did he receive a telegram from the solicitors of the International Longshoremen's Association regarding the settlement to which he was a party? Can the Prime Minister also tell me whether he has heard from Mr. Claude Jodoin complaining that Bill C-215 amounts to compulsory arbitration, and that it had been made very clear to the members of this union at the time the settlement was finally agreed upon that nothing in the nature of the legislation now on the order paper would be brought into effect in any way?
What is the Prime Minister's answer to the allegations that are made in the telegram that in his office and in his presence the Minister of Labour raised the question of final and binding arbitration-
July 5, 1966

Inquiries of the Ministry


Mr. Speaker:: Order, please. It seems to me the question is rather lengthy. It should be condensed if possible.


John George Diefenbaker: It is a very long telegram, Mr. Speaker, and I was reading three
lines from it.


Mr. Speaker:: The right hon. Leader of the
Opposition knows, of course, that he cannot read the telegram as part of his question.


John George Diefenbaker: The telegram continues as follows:
The Hon. Nicholson raised the question of final and binding arbitration and again President Jodoin strenuously opposed final and binding arbitration being part of any settlement...
What has the Prime Minister to say in this regard, and is it the intention of the government to proceed with this bill before the summer adjournment?


Right Hon. L. B. Pearson (Prime Minister):: I have received the telegram to which my right hon. friend has referred, and I have replied to it. The Minister of Labour has replied to it at greater length, and has challenged and denied some of the facts alleged in the telegram. There will be ample opportunity to discuss the matter when the bill is introduced and proceeded with, as it will be.


John George Diefenbaker: Will that take place before the adjournment?


Lester Bowles Pearson: Yes, Mr. Speaker, before the
adjournment.


Mr. David Lewis (York South):: I should like to address a question to the Prime Minister, related to one asked earlier by the Leader of the Opposition. Would the Prime Minister give consideration to tabling (1) a copy of the memorandum of settlement between the shipping federation and the longshoremen's association of the St. Lawrence ports, and (2) all letters, copies of letters and telegrams sent or received by him and the Minister of Labour to or from the unions and their solicitors?
Sone hon. Members: Order paper.


David Lewis: I ask this now because I understand that Bill C-125 will be coming before this house shortly, and I think it would be helpful if these documents were available.


Lester Bowles Pearson: I will be glad to give consideration to the tabling of all the relevant documents.



VANCOUVER-POSSIBLE TROUBLE FOLLOWING IMPRISONMENT OF UNION OFFICERS

[Stage Direction]
On the orders of the day:
['Mr. Speaker, the Prime Minister answered that question yesterday. The fact is that we discussed the matter recently with the representatives of the United States.']
David Lewis: I have a question which I intended to put to the Minister of Labour. I sent him notice, but in his absence perhaps I might ask it of the Solicitor General. In view of the possibility of serious difficulty on the Vancouver waterfront arising out of the imprisonment of ten officers of the longshoremen's union on the west coast, has the government given consideration to the possibility of the governor in council taking action by way of a remission or a pardon in this case so the imprisoned longshoremen may be released from jail shortly, thus avoiding future difficulties?


Hon. L. T. Pennell (Solicitor General):: propose to take the question as notice so I will have an opportunity of discussing the matter fully with the Minister of Labour on his return tomorrow.



[Stage Direction]
On the orders of the day:
Mr. Real Caouette (Villeneuve):: Mr. Speaker, I wish to put a question to the hon. Secretary of State for External Affairs. In view of the fact that he keeps posted on the developments in Viet Nam, can the Minister tell us if the government has officially protested against the bombing of Hanoi and Haiphong, and if bombing of those two cities is now being pursued?


Hon. Paul  Marlin@Secretary of Slate for External Affairs: Mr. Speaker, the Prime Minister answered that question yesterday. The fact is that we discussed the matter recently with the representatives of the United States.



HEALTH AND WELFARE


[Stage Direction]
On the orders of the day:
Hon. Theogene Ricard (Saini-Hyacinihe-Bagot):: Mr. Speaker, I should like to direct a question to the Prime Minister. In view of the reservations expressed by the premier of Quebec, Mr. Johnson, on the federal medicare plan, is the Prime Minister in a position to tell the house whether he has exchanged views with the premier of Quebec on this matter?
July 5, 1966	COMMONS


Lester Bowles Pearson: Not on this particular matter, Mr. Speaker, to my knowledge, although I will check as soon as I get back to the office.


J.-H.-Théogène Ricard: A supplementary question, Mr. Speaker. Will the views expressed by the premier of Quebec result in a change of plans on the part of the federal government and prevent the bringing down of this resolution before the adjournment?


Lester Bowles Pearson: Mr. Speaker, we expect to proceed with this piece of legislation.



AGRICULTURE


[Stage Direction]
On the orders of the day:
Hon. Michael Starr (Ontario):: I wish to address a question to the Minister of Agriculture. In view of the fact that his announced policy of paying $4 per hundredweight on manufacturing milk has caused serious injustice to dairy farmers, would he be prepared now to announce a revision of that policy to make the payment $4 f.o.b. the farm?


Hon. J. J. Greene (Minister of Agriculture):: Mr. Speaker, the government's policy as announced in this house quite clearly stated, and I emphasize the exact words, "the support level will provide an average net return of $4 per hundred pounds of manufacturing milk testing 3.5 per cent butterfat content, basis f.o.b. the factory."


Mr. Grafffey:: Yes, f.o.b. the factory.


John James Greene: F.o.b. the factory; that was my announcement in this house at the time the policy was announced. I was very careful also to point out, if hon. members would read Hansard before asking questions-


Some hon. Members:: Oh, oh.


John James Greene: I was very careful to point out also that the federal government did not have the authority to fix prices within the provinces, and that price fixing would be a provincial matter or a matter for producer organizations within provinces. All this information is contained specifically in the words in which I made the statement in this house at the time the program was announced.
DEBATES	7185
Inquiries of the Ministry


Michael Starr: May I ask a supplementary question. In view of the fact that the implementation of this policy has caused injustice to dairy farmers, will the minister revise it?


Some hon. Members:: Oh, oh.


Michael Starr: Will the minister consider revising-


Mr. Speaker:: Order, please. The hon. member cannot include an allegation as part of his question.


Michael Starr: Would the minister now consider revising the policy so this $4 per hundredweight on manufacturing milk would be f.o.b. farm instead of factory?


John James Greene: Mr. Speaker, as I made clear in my statement there is no constitutional way in which we can fix the price f.o.b. the farm. Naturally, costs of transportation as between one farmer and another vary. I do not think the hon. member would suggest that the cost of transportation to a farmer who has to truck his milk 20 or 25 miles is not greater than the cost to the fellow who fives right next door to the factory. Therefore the actual fixing of price under the constitution is a provincial matter.
I understand that there are some difficulties with respect to transportation and transportation costs which have been raised by the manufacturers. This is a matter which is purely within provincial authority. In fixing the price of the milk through milk marketing boards, transportation costs can be considered. While I am very anxious, as I know all hon. members of the house and others are, to do everything I can for the farmers-


Michael Starr: Mr. Speaker, on a point of order, I wonder whether instead of the minister making a speech the Chair would ask him to be concise and to answer the question that was posed to him.


John George Diefenbaker: Mr. Speaker, so we will get right down to it, does the minister say that constitutionally, while he can fix the price to be paid for fluid milk at the factory at $4, he cannot fix it at $4 on the farm? Is that what he tells us?


An hon. Member:: That is what he said.


John James Greene: Mr. Speaker, I know the right hon. gentleman is far more familiar with the
July 5, 1966

Inquiries of the Ministry constitution than I, but the government's policy was stated quite clearly, as follows; that it-


Some hon. Members:: Oh, oh.


Mr. Speaker:: Order, please.


Mr. Eric A. Winkler (Grey-Bruce):: Mr. Speaker, inasmuch as there is not another commodity on the Canadian market which bears transportation costs, in part or in whole, of this sort, would the minister say that he will now change his milk policy so as to make for a more equitable distribution of payments to the farmers?


John James Greene: Mr. Speaker, I think in making a 40 per cent increase in a three year period we have effected an increase which is larger than the increase relating to any other commodity. I think the federal government's policy in this regard is most adequate, and I believe the farm organizations have so expressed themselves.
I hope that in conjunction with provincial organizations we can evolve a policy which will be satisfactory both to the manufacturer and to the farmer, and we are working toward that end every day.


Eric Alfred Winkler: Mr. Speaker, one further supplementary question. I should like to ask the minister to whom is his policy satisfactory, himself or the farmer?


Mr. Speaker:: Order, please.


J.-H.-Théogène Ricard: Mr. Speaker, I should like to ask the Minister of Agriculture whether he figures that $3.15 is satisfactory to the farmers.


Mr. Speaker:: Order, please.


Mr. Roxburgh:: It is better than $2.85.


Hon. Alvin Hamilion (Qu'Appelle):: Mr. Speaker, a supplementary question to the Minister of Agriculture. In view of the fact that there are constitutional limits as to what the federal government can do, and in view of the fact that there is a new government in Quebec, would he now invite to Ottawa the ministers of agriculture of these two central provinces, which must co-operate to make this milk policy work, so as to work out with the help of two co-operative provinces a method which is constitutionally sound and which will make it possible to give the farmers what was promised?


John James Greene: Mr. Speaker, prior to the formulation of the policy I was in communication with the ministers of the various provinces, and I think I can say we worked together in harmony in arriving at this policy. In view of the teething problems respecting the program that my hon. friend refers to, including transportation costs, I am pleased to let him know that I have teed up a meeting with the provincial ministers of Quebec and Ontario for Thursday morning.


David Réal Caouette: Mr. Speaker, I wish to put a supplementary question to the Minister of Agriculture.
When the minister informed the house of the government dairy policy he gave a clear and precise impression, throughout Canada, to all farmers, that from now on-


Mr. Speaker:: Order. The hon. member must, at this time, put a question.


David Réal Caouette: -all farmers would receive $4 per hundredweight.
Today, the minister tells us that, due to transportation, the $4 is not paid to farmers. Can the minister take some action so that farmers may get $4 per hundredweight for milk? That is what we want to know.


Mr. Speaker:: This question is a repetition of another one which has already been put several times this afternoon.


Mr. H. A. Moore (Weiaskiwin):: My question is directed to the Minister of Agriculture. Will the minister meet with the minister of agriculture for Alberta to discuss means of remedying the situation in which Alberta dairymen are receiving $2.81J cents per hundredweight for milk sold as cream, a price which includes the 75 cents subsidy, and they are receiving for milk sold as manufacturing milk-


Mr. Speaker:: Order. I suggest to the hon member that though the first part of his question was in order it was becoming a little too involved. Perhaps he will allow the minister an opportunity to answer the first part of his question now.


John James Greene: Well, I have not had any request from the province of Alberta for any meeting. I know of no provincial action to fix the price, as the province is able to do. If the
July 5, 1966	COMMONS
provincial minister wishes to meet with me at any time I shall be only too happy to meet him.


Harry Andrew Moore: Is the minister aware that this price does not include hauling charges and that $3.44 is the maximum for milk shipped to manufacturing plants?


Mr. Speaker:: Order. The second part of the question is argumentative.


Mr. Arnold Peters (Timiskaming):: Would the minister give consideration to setting a stabilization figure of $4 under the Agricultural Stabilization Act? If this were done the constitutional difficulty outlined would not develop.


John James Greene: The present policy involves a support program which will enable the payment of $3.25 at the factory. Powder, butter, casein and all the other products are supported by the stabilization board to enable the payment of $3.25 which in Ontario is fixed by the province at that level.
This means that the farmer gets $3.25 plus the 75 cents paid by the federal government, plus the 10 per cent export subsidy. So actually the farmer will get $4.10, and this is a stabilization board policy which enables the payment of $3.25 f.o.b. the factory. However, if the provinces do not see fit to take action to protect that $3.25, it is a matter for them. I hope our negotiations will persuade the provincial governments to take adequate action in conjunction with ourselves to ensure a return of $4.


Michael Starr: A supplementary question to the minister. How can he reconcile the present situation in which farmers receive only $3.10 or $3.15 per hundredweight with his statement of March 23 to the effect that this policy-


Mr. Speaker:: Order, please. I suggest to the hon. member that his question is not a proper one at this time.


Michael Starr: Well, I rise on a point of order so as to clarify the situation. I think the minister misled the house at that time.


Some hon. Members:: Oh.


Mr. Speaker:: Order. The hon. member
should make it clear whether he is making a charge against the minister. If he is rising on a point of order he should state exactly what his point is, and the Chair will have a chance to rule on it.
DEBATES	7187
Inquiries of the Ministry


Michael Starr: My point is that the minister made a statement on March 23, as reported at page 3401 of Hansard, that this policy would ensure a price of $4 a hundredweight to, Canadian milk producers. This has not been the case, and I believe the minister has misled the country and the farmers of this, country.


Mr. Speaker:: Order. This is not a proper point of order. It is an argument along the lines of the one on which we have been, engaged for the past few minutes. I do not accept the question.


Mr. Gilles Gregoire (Lapointe):: Mr. Speaker, my question is directed to the Minister of Agriculture. In view of the fact that he stated a while ago that he will meet with the Quebec minister of agriculture next Thursday about this price of $4 per hundreweight for milk, could the minister take with him, on that occasion, a copy of the Debates for March 23, 1966, when, as recorded on page 3043, the-present Quebec minister of agriculture stated here in this house that $4 per hundredweight should be the minimum price for farmers?



TELEVISION


[Stage Direction]
On the orders of the day:
Mr. J. B. Stewart (Parliamentary Secretary to Minister of Public Works):: Mr. Speaker, this question is for the Minister of Transport. Now that the white paper on broadcasting has been tabled the Minister of Transport will not be surprised by this question. Will the minister not recognize the concern of many regions of the country, including the eastern and northern parts of Nova Scotia, and announce whether the freeze on the establishment of alternative television service will be lifted soon?


Hon. J. W. Pickersgill (Minister of Transport):: Mr. Speaker, the freeze is lifted as of now except for the four places-I think it is four-mentioned specifically in the white paper that are to be reserved to the C.B.C. I am sure all hon. members who are interested will be glad to know this.


Mr. H. Russell MacEwan (Pictou):: A supplementary question, Mr. Speaker. Now that the minister has answered the previous question I wonder if he would not again speak to.
7188	COMMONS
Inquiries of the Ministry the Secretary of State and ask her to table the order for return, with respect to television service for the county of Pictou, passed by this house on April 6.


John Whitney Pickersgill: I am sure the Secretary of State would find the hon. gentleman's request just as seductive as mine.


Mr. L. M. Brand (Saskatoon):: Mr. Speaker,
I have a supplementary question for the Minister of Transport regarding the freeze not being lifted in the four areas mentioned in the white paper on broadcasting. I would ask him whether this means that C.B.C. stations will not be built in those areas, as it says in the white paper.


John Whitney Pickersgill: Evidently I did not make
myself clear, and I think it is very desirable that I should try to do so. The white paper indicates-I am speaking from memory-that Saskatoon, Victoria, Sudbury and the Saint John-Fredericton area are being reserved-the alternate is being reserved-for the Canadian Broadcasting Corporation. What my announcement meant was that in the case of the Department of Transport any other application from any other place for alternate service would be received in the ordinary way and transmitted to the Board of Broadcast Governors for such consideration as they might choose to give it.


Mr. Cantelon:: Does this mean that the C.B.C. would immediately proceed to put stations into those areas?


John Whitney Pickersgill: That, I think, is a matter which would not come within the responsibilities for which I answer to parliament. I will direct the question to the Secretary of State.


Mr. Joseph Macaluso (Hamilton West):: [DOT]have another question for the Minister of Transport. Does the government or the Department of Transport intend to continue to issue licences to cable television companies in the light of the CATV report in the white paper on broadcasting tabled in this house yesterday?


John Whitney Pickersgill: It is the intention of the government to continue in exactly the same way as we are now proceeding with CATV licences until such time as parliament amends the legislation, if it chooses to do so, in accordance with the recommendations in the white paper. So, for the time being, and contrary to some reports made yesterday, there will be no change whatsoever.
fMr. MacEwan.]
DEBATES	July 5. 1986



SHIPBUILDING


[Stage Direction]
On the orders of the day:
Mr. Thomas M. Bell (Saint John-Alberi):: My question is for the Minister of Finance, Mr. Speaker. Was the shipbuilding industry consulted with respect to Bill C-216, as promised? If not, will full opportunity be given to these important segments of our industry to make their representations with respect to this bill, part of which repeals the Canadian Vessel Construction Assistance Act, which will have such a serious effect on that industry?


Hon. Mitchell Sharp (Minister of Finance):: Mr. Speaker, the bill that has been introduced does not change anything of substance with respect to the act that will be repealed, because its provisions will be incorporated into the Income Tax Act. I also have received many representations from the industry, and in order to make sure there is an opportunity for consultation I am giving sympathetic consideration to the request that the sections of the bill the hon. member has referred to should be deferred.


Mr. T. S. Barnett (Comox-Alberni):: Mr. Speaker, I should like to direct a question to the Minister of Finance arising out of an answer he gave a few minutes ago to the hon. member for Saint John-Albert. I should like to ask him whether I understood him correctly to say that the proposed repeal of the Canadian Vessel Construction Assistance Act is not in any way to modify or reduce the benefits that certain taxpayers now enjoy, but that none the less he was going to withdraw certain sections from the proposed income tax bill until after the recess?


Mr. Speaker:: Order, please. I do not think the question as asked now is acceptable. The hon. member is posing an argument. He is asking whether he understood the minister correctly. I do not think the question as posed can be asked.


Thomas Speakman Barnett: May I assure you, Mr. Speaker, that I have no intention of being argumentative. However, some strong representations have been made on this matter, and I should like to understand what the minister is going to do. Could I ask whether he is going to withdraw all the sections in the
July 5. 1966	COMMONS
proposed income tax amending bill, Bill C-216 until after the recess so he can reach an understanding on the question of repeal of the Canadian Vessel Construction Assistance Act.


Mitchell William Sharp: Mr. Speaker, in reply to the
original question I said I was giving consideration to the request to withdraw from the income tax bills those sections relating to the Canadian Vessel Construction Assistance Act.
I did not say they would be withdrawn, because before I do that I would like to look at the technical questions involved when the bill is called.


Thomas Miller Bell: Can we take it that if the minister does not decide to make a deferment there will be an opportunity for the industry to be heard before the matter comes forward?


Mitchell William Sharp: That is a hypothetical question.
I hope it does not arise.



WHEAT-INQUIRY AS TO TWO PRICE SYSTEM

[Stage Direction]
On the orders of the day:
Mr. E. Nasserden (Rosihern):: Mr. Speaker, yesterday I directed a question to the Minister of Agriculture in regard to the government's plans with respect to a two price system for wheat. I did not hear his reply at that time, but it was as follows, and I quote from page 7127 of Hansard:
If government policy is made in this regard it will be announced in the normal manner.
I now ask the Minister of Agriculture whether this means that the government is planning to renege on its widely publicized election promise with respect to a two price system-


Mr. Speaker:: Order, please. This question is argumentative and cannot be received in that form.


Edward Nasserden: Then I should like to direct another question to the Prime Minister. In view of the rising cost of production of grain, has the government under consideration a policy which would enhance the return to producers?


Mr. Speaker:: Order, this question is of a very general nature and I suggest to the hon. member that it ought not to be asked now.


Edward Nasserden: It is also a very urgent question. As we know, there have been a
DEBATES	7189
Inquiries of the Ministry number of labour disputes in this country, settlement of which has meant a 30 per cent increase in labour costs. The prices of many of the items needed by farmers have been going up, and I think it is fair to ask the minister whether some consideration is being given to the farmers of this country.


Mr. Speaker:: Order, please.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Mr. L. R. Sherman (Winnipeg South):: have a question for the Minister of National Defence. Can the minister dispel the report, widely circulated in Manitoba, that all contracts are being terminated at the joint air training base at Rivers, that military personnel are being moved out and that the base is to be closed?


Hon. Paul Hellyer (Minister of National Defence):: This is just speculation. No decision
whatsoever has been taken in this regard.


Mr. Nicholas Mandziuk (Marquette):: I
should like to follow this up. Will the minister tell us whether such action is being considered?


An hon. Member:: That is what he said.


J. Nicholas (Nick) Mandziuk: Is the department planning to close this base?


Paul Theodore Hellyer: Well, hypothetically, as far as the base consolidation program is concerned, all permutations are being considered. It would therefore be true to say that any base in the whole system was being considered in the light of its future usefulness. Beyond that I cannot go, because no decision has been taken in reference to Rivers or any other base in the area.



SCIENCE COUNCIL OF CANADA


[Stage Direction]
On the orders of the day:
Mr. Lloyd R. Crouse (Queens-Lunenburg):: have a question to address to the Prime Minister. In view of the fact that none of the 29 men recently appointed to the Science Council of Canada has any association with the aquatic sciences, will the right hon. gentleman reconsider these appointments and
July 5, 1966

Inquiries of the Ministry make the necessary changes in the council so the problems of our fishing industry and specifically those related to our aquatic resources can be examined and studied by someone with knowledge of this subject?


Mr. Speaker:: Order. I suggest the hon. member place this question on the order paper.


Lloyd Roseville Crouse: On a point of order, Mr. Speaker, a series of underwater acoustics studies is to be undertaken this month by Canadian and United States scientists off Cape North, Nova Scotia. Several agencies are co-operating to instal equipment for this project which is centred at a Canadian National telecommunications site. These include the naval research establishment, the United States navy, Canadian Army signals-


Mr. Speaker:: Order. I wonder whether the hon. member would state his point of order.


Lloyd Roseville Crouse: In view of the fact these people are investigating underwater acoustics in cold water in this area, and since their findings could be of great interest to the science council if there were someone on the council who could appraise them, I think this suggestion should be given consideration.


Mr. Speaker:: The hon. member has made
very effective representations by means of his point of order. I can only hope, with him, that they will be taken into account.



INQUIRY OF THE MINISTRY

[Stage Direction]
On the orders of the day:
Mr. Robert McCleave (Halifax):: Mr. Speaker, my question is for the Prime Minister. Has the Prime Minister or anyone on his behalf written to any assistant deputy ministers or others in the top levels of the civil service to inquire whether they would move to Quebec for a while to perfect their bilingualism?


Mr. Speaker:: Order. This question is not so urgent that it could not be placed on the order paper.



IMMIGRATION


[Stage Direction]
On the orders of the day:
Hon. Jean Marchand (Minister of Citizenship and Immigration):: Mr. Speaker, on June 20 and 21 the hon. member for

Okanagan-Revelstoke inquired about a young Japanese girl, Masako Endo, who was ordered deported at Vancouver airport two weeks ago while seeking to visit Canada.
I have deferred making a statement on this case until all of the facts were known and the immigration appeal board had reached a decision on her appeal against the deportation order. The immigration appeal board has heard the girl's appeal, and while they have dismissed it they have recommended that she be permitted to carry on with her visit in Canada. We agree entirely with this decision.


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
Right Hon. J. G. Diefenbaker (Leader of
the Opposition): Mr. Speaker, I should like to-direct a question to the Secretary of State for External Affairs regarding the situation in Rhodesia. Now that the Prime Minister of the United Kingdom has announced the temporary suspension of Britain's search for a Rhodesian compromise, has the government of Canada agreed that any compromise settlement which is finalized must be acceptable to-all Rhodesians as well as internationally acceptable to foreign nations?
Hon. Paul Martin (Secretary of State for External Affairs):: Mr. Speaker, I did not hear what my hon. friend said at the beginning. I will take this question as notice.


John George Diefenbaker: Mr. Speaker, I do not want to go over it again. I simply ask the minister this: What is the present position in respect of the suspension of the talks between the British government and Rhodesia; and is the government of Canada in agreement that any final settlement must be acceptable not only to all Rhodesians but internationally as well?


Paul Joseph James Martin: Mr. Speaker, I had not understood the first part of the question. The talks have not been suspended. There have been two series of talks, one in London and a second one in Salisbury. A third round of talks is now under way in Salisbury. I hope those talks will determine whether there is a basis for negotiation-a negotiation, however, which as the British Prime Minister said must be without commitment.
July 5, 1966


John George Diefenbaker: The minister says the talks have not been suspended. Does he realize that at Westminster today the Prime Minister of the United Kingdom said they had been suspended until later this month so as to give each side time to reflect. Is the minister now in a position to answer the question? Does the Canadian government agree and is it acceptable to the Canadian government that on a Commonwealth matter such as this not only must there be the consent of all the inhabitants of Rhodesia, but such a settlement must be internationally acceptable?


Paul Joseph James Martin: Mr. Speaker, in so far as these talks are concerned the problem involves primarily the government of Britain and the illegal regime represented by the spokesmen for Rhodesia. Canada is not bound in any way by the conclusions of those talks. The arrangement thus far is one between the colonial power and the dependent regime. When we know what the conclusions are we will be in a position to ascertain whether they do involve independent members of the Commonwealth. Until we know the result of those talks it is not possible to make any reply to the last part of my right hon. friend's question.



PUBLIC SERVICE


[Stage Direction]
On the orders of the day:
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I should like to direct a question to the Minister of National Revenue. In view of the fact that last week announcements were made concerning salary revisions for the administrative support category in group B, can the minister say when the corresponding announcement will be made concerning the administrative category in the same group?


Hon. E. J. Benson (Minister of National Revenue):: Mr. Speaker, the administrative category was held up due to the reclassification which is taking place. Such reclassification is being carried out by the Civil Service Commission, and we have urged the commission to proceed with this with all haste in order that we might consider this matter.


Robert Jardine McCleave: Mr. Speaker, I have a supplementary question. I

Inquiries of the Ministry should like to ask the Minister of National Revenue whether he is in a position to reply to my question of last week concerning the red circling of employees in the Department of National Defence?


Edgar John Benson: Mr. Speaker, I will answer this question tomorrow.



COMMONWEALTH RELATIONS


[Stage Direction]
On the orders of the day:
Mr. Max Saltsman (Waterloo South):: Mr. Speaker, I should like to direct a question to the Secretary of State for External Affairs. Has he given consideration to the recommendation of the association of Atlantic universities for the establishment of a permanent Canadian-West Indies committee by the governments of Canada and the Commonwealth Caribbean countries?


Mr. Speaker:: Order. I suggest that the hon. member's question should be placed on the order paper.



AGRICULTURE


[Stage Direction]
On the orders of the day:
David Réal Caouette: Mr. Speaker, I wish to direct a question to the Minister of Forestry.
Since the election of a new provincial government in Quebec, has the minister been in touch with the provincial authorities in the fields of agriculture or lands and forests to ensure the continuation of the ARDA program in order to help the growth of the underdeveloped areas of Quebec?


Hon. Maurice Sauve (Minisier of Forestry):: Yes, Mr. Speaker.


David Réal Caouette: Mr. Speaker, has the minister any statement to make to the house, so that we might know where we stand with these authorities?


Mr. Speaker:: I must point out to the hon. member that it is not the time to make statements in the house.

July 5, 196R
Canada Assistance Plan INCOME TAX



REDUCTION OF CLAIMS FOR CHARITABLE DONATIONS

[Stage Direction]
On the orders of the day:
Mr. Roland Godin (Portneuf):: Mr. Speaker, I wish to direct a question to the Minister of Finance.
Could the minister tell us why the receipts for charitable donations which are enclosed with the income tax returns from honest citizens, whether they be for $200, $300 or $400, are now all reduced by half?


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



VETERANS AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. Robert Stanbury (York-Scarborough):: Mr. Speaker, I have a question for the Minister of Veterans Affairs, but perhaps in his absence I may be allowed to direct it to the acting minister. Has the government concluded an agreement with the province of Ontario regarding the sale of Sunnybrook hospital to the University of Toronto? If so, can the minister assure the house that veterans will have permanent priority in respect of admittance to this hospital?


Hon. Leo Cadieux (Acting Minister of Veterans Affairs):: I will take this question as notice, Mr. Speaker.



CANADA ASSISTANCE PLAN


[Stage Direction]
The house resumed, from Monday, July 4, consideration of the motion of Mr. Mac-Fachen for the second reading of Bill No. C-207, to authorize the making of contributions by Canada toward the cost of programs for the provision of assistance and welfare services to and in respect of persons in need.
Mr. J. E. Pascoe (Moose Jaw-Lake Centre):: Mr. Speaker, when the house rose last night I was commenting about repeated statements of previous speakers from our party regarding the need to provide our senior citizens with higher old age pensions to offset at least partially the effects of the ever increasing cost of living.

I stated that in moving for a $100 a month old age security pension the members of the Progressive Conservative party are not advocating something new to that party. An old age security pension of $100 a month was a plank in our platform during the 1965 election campaign. I referred to this campaign commitment during meetings with senior citizens of my riding, and that is why I now speak on their behalf.
Last night I stated that it should be the duty of each of us in this house to express his or her views on the need for higher pensions for senior citizens who are trying to live on the present old age security payment of $75 per month. The hon. member for Waterloo North agreed that our senior citizens are entitled to fair treatment, and stated specifically last night that pensions provided at this time under the Old Age Security Act are insufficient.
The hon. member for Brantford stated that he had been advocating changes in the Old Age Security Act for the benefit of senior citizens without the requirement of a means test, and I should like to quote his exact words as they are recorded at page 7095 of Hansard for June 30. He was referring to previous speakers when he said:
I believe the debate indicated that they had a feeling which is shared all over this house that the means test or even the needs test, which is an improvement over the means test, should not be used with regard to the senior citizens of Canada.
I am sure many other members on the government side would express the same opinion if they should take advantage of the opportunity of speaking during this debate. I heard the hon. member for Essex South express views along this line during a radio interview, and perhaps he will put these same views on Hansard.
The records in Hansard to date show clearly that we in the Progressive Conservative party have been pressing for a $100 a month pension since this session commenced on January 18. The records also show that the Liberals with Social Credit support have consistently voted against any pension increase. I mention these facts to emphasize the concern of the members of this party for our senior citizens. We believe they should be treated in a more fair manner. Members of the N.D.P. have attempted to take credit for what we in this party have tried to do in respect of this matter, but this party's record in this regard will stand comparison with the record of any other party.
July 5, 1966

Let me point out that the record of the former C.C.F. government of Saskatchewan does not indicate that that party was above criticism in its treatment of senior citizens. I recall hearing complaints about a strict means test being applied before supplementary payments to old age pensioners were allowed, and those payments in many cases only amounted to a niggardly $2 per month. I am sorry the hon. member for Burnaby-Coquitlam is not in the house at this time to hear these remarks, because he was the leader of that party and the premier of Saskatchewan at that time.
I am speaking in support of a pension increase because I promised to do so in replies I made to many senior citizens in my riding who have written me personal letters or forwarded petitions regarding an increase. I could have brought a whole sheaf of petitions from my file, but I have only brought one or two which I intend to use as examples.
The petition I have in my hand is from the National Pensioners and Senior Citizens Federation and is written over the name of Mr. Nathan W. Medd, president, who lives in Saskatoon, Saskatchewan. I shall not read the resolution, but I wish to point out that the National Pensioners and Senior Citizens Federation reaffirmed their request that the federal government increase the old age security pension to $100 per month.
I know personally many of the people who have written about pension increases as well as many of those who have signed petitions, and I know their needs. I am sure the Prime Minister and the Minister of National Health and Welfare have received similar letters and petitions because I have received copies of some that were sent to those gentlemen. Surely I need not point out to the Prime Minister or the Minister of National Health and Welfare that public opinion has been aroused regarding the need for more consideration for those individuals who helped build our country but who have now passed the income earning stage.
[DOT] (3:30 p.m.)
There are reports that the minister will announce some form of income increase to those in their later years who can prove need. It will be interesting to learn just how far our demands of the past few days have induced the government to alter or add to the legislation before us. I join with other speakers in protesting against what the government wishes to call a needs test but which is actually only another name for a means test.
Canada Assistance Plan Under such a system, as the hon. member for Queens commented, not only must one be poor but one must prove to some official of the state that one is poor.
I have here a petition from the National Pensioners and Senior Citizens Federation which contains the comment: "By changing the word 'means' to 'need' is just eyewash." I have another petition from the Senior Women's Committee for Pension Increase which says: "Senior citizens and families won't tolerate humiliating needs test."
If the government is not moving to increase the old age pension to $100, for which we are pressing, we hope that the means test or the needs test will be removed from Bill C-207. It will be interesting to hear from the Minister of National Health and Welfare in this regard.


Mr. W. B. Nesbitt (Oxford):: Mr. Speaker, I do not wish to take up much of the time of the house on this matter. However, there are two points I should like to bring to the minister's attention which I do not think have been brought to his attention so far in this debate. Before I do so, however, I should like to reiterate the plea made by most members on this side of the house that the minister persuade his colleagues to reconsider this question and provide $100 a month without a means test to the old people of this country who will not benefit under the Canada Pension Plan right away.
The other two items I wish to bring to the minister's attention are these. When regulations are made in connection with this legislation after it eventually passes the house, I hope that particular attention will be paid to the section referring to disabled persons and the disabled persons allowance. This matter has been raised by me many times in the house and by hon. members in various parties, particularly the hon. member for Simcoe North (Mr. Smith). I refer to the existing regulations with respect to the disabled persons allowance.
At the present time a person wishing to receive the disabled persons allowance practically has to have both arms and both legs off. This works a great hardship on many people. I am sure every hon. member in the house has dealt with this problem many times. I suggest to the minister again, and I hope this time he pays some attention to my suggestion, that he persuade his colleagues that employability should be the criterion whether a person should receive the disabled persons

July 5, 1966
Canada Assistance Plan allowance. If people are so disabled and ill that they cannot work for a period of time, let us say six months, they should receive the disabled persons allowance for as long as they are unable to work. If at some time in the future they are able to work, of course the allowance should be discontinued.
At the present time the regulations require that a person be totally and permanently disabled to receive the allowance. Most doctors, probably because they think they will never be in this shape themselves, will not sign a certificate saying that a person is permanently disabled if there is one chance in a million of his getting better. This regulation has worked great hardship on all kinds of people in this country. I hope the government will see that it is changed when the new regulations are promulgated under the act or arrangements are made with the provinces.
The last item I bring to the minister's attention is the question of mothers allowance. Under this legislation the federal government proposes to help pay mothers allowance. I hope that when this measure comes into effect the minister will make certain that some of the regulations that exist in some parts of Canada in this regard are removed. The fact is that if a husband deserts his wife and children the mothers allowance cannot be paid, no matter how much it may be needed by the family, as long as the husband can be found within a certain period of time. If the husband disappears permanently and cannot be found, the wife receives the mothers allowance in respect of her children, but if the husband turns up just once in Timbuktu or somewhere else and is found for just one day the allowance is cut off no matter how practically impossible it is for the mother to receive any assistance from such husband. This is a ridiculous situation. I hope that the minister, when arrangements are made with the provinces or regulations are drawn up under this legislation, will see that this iniquitous situation no longer exists.


Mr.   J.-A. Mongrain@Trois-Rivieres: Mr. Speaker, I have no intention of extending the debate and I am not responsible for its extension until this afternoon, because I had made up my mind not to practise any obstruction against the government regarding the legislation now before us and entitled "Canada Assistance Plan."
The fact remains, nevertheless, that so many things have been said and so many stands

have been taken that I can hardly allow the debate to end without saying a few words to explain my position. At the beginning of the session, when the opposition introduced a non-confidence motion against the government with regard to a $100 increase in the monthly pension, I then voted with the government, because 1 realized it was merely a non-confidence motion which, had it been passed by the house, would probably not have settled the problem of older people. It would simply have embarrassed the government perhaps to the extent of bringing about another election. But at any rate, it would have delayed the passage of this social assistance measure promised by the present government at the time. Along with many others I waited with some anxiety to study the provisions of the bill to be introduced and designed to help needy Canadians.
We now have before us this piece of legislation under the form of Bill No. C-207. I am not suggesting that this bill is perfect, because I know of no party and of no government which have ever passed perfect bills in this house, but I say it is nevertheless a noteworthy effort of good will in spite of the inadequacies of the bill. Following this lengthy discussion which has lasted at least a week, and thanks to the numerous suggestions constructive or otherwise, which have been made, the government will certainly be able to improve this piece of legislation.
I, for one, am satisfied, Mr. Speaker, to see that the government respects the constitutional authority of provinces in the field of assistance to the needy, since it intends to support the provinces in the proportions mentioned in the bill. This is quite satisfactory.
I am satisfied to see that the government not only wishes to help the aged, our senior citizens, the old folks, those who are no longer young, but that it also wants, according to the bill, to help those who are in need in all areas, the unemployed, the disabled, the widows, the needy of all kinds.
I think that those who have been saying for a week that there is nothing in the bill, nothing good, that the bill means nothing, are not being fair. We must understand, Mr. Speaker, that this bill, even though it is not perfect, offers something; it is certainly an improvement on what existed before, and we should at least, instead of dragging on the debate interminably, all say together: Well, let us give that at least to the needy for the time being; let us give it to them as soon as possible, and afterwards, we shall consider improving the situation, which is not perfect.
July 5, 1966

It is sure that if we accepted the suggestion to give immediately $100 a month to the elderly people this would not settle the problem, because there are many elderly people who need more than $100. This bill provides for some medical care, some related aid which would mean to them more than $100 a month. At any rate, is it really fair to give $100 to those who do not need it and then refuse $125, $130 to those in need? We should wonder about that.
The point that we should consider, Mr. Speaker, and about which the opposition has better justification, is the objection to a needs test. Experience proves that these tests are usually made by incompetent persons, who lack tactfulness and the necessary circumspection; they often take the form of an inquisition, which is humiliating for the needy, who have a legitimate self-respect, and in many cases have to go through certain methods of inquiry which are vexatious and unacceptable.
* (3:40 p.m.)
The main recommendation, I believe, that should be made to the government about this bill is that those who are called upon to come into contact with the needy, the elderly people, widows, unemployed, etc., should follow training courses to learn tactfulness and warmth which should characterize all the actions of social service workers, which is charity or philanthropy in certain cases, but which, in the present case, is a service due to all taxpayers.
A great number of these taxpayers have already paid taxes on considerable amounts to guarantee the efficient application of such acts to the needy, and they are entitled to be treated with due respect. I should like to stress that point Mr. Speaker, and in this respect I endorse the criticism of the opposition. The methods of investigation should certainly be improved upon, as should the methods of all who are in contact with the needy in order to eliminate red tape, police investigations, receipts and all kinds of things that add to the hardship of those unfortunates for whom life has not been overly generous.
Now the fact remains, at least in my province, that the program will be administered by the province. If my province were to decide to pay $100 per month to the elderly persons, to the old people, I cannot see what objection the federal government would have; if my province were to decide to pay $125 per month, I do not believe the federal government would object. So I say that the bill,
Canada Assistance Plan although it may not seem as generous as the members of the opposition, or most of them, claim, it is opening the door in a generous way.
It was urged since the beginning of the debate that the act should be made to apply uniformly, Mr. Speaker. I hardly think the needy can be taken care of in a uniform manner in Canada, because the needs are not the same. At this point I repeat what I said a while ago: to give $100 or $150 to an elderly person who does not need it is too much; yet giving $125 to a senior citizen who needs $150' is too little.
The opposition, Mr. Speaker, claimed that it was not resorting to what the Americans call a filibuster. The claim was made sometimes with a tongue-in-the-cheek attitude. Sitting in this far corner as an independent, Mr. Speaker, the impression I get is that several members have taken the opportunity of this debate for some electioneering, and that is the impression that is gathered here. All sides of the house claimed not to be playing politics, I think. But I feel there has been too much politicking going on, while the contrary was being claimed, at the expense of the old people and of the needy. I do not think this is proper. I do not say that to blame all those who took part in the debate, but simply because I have enough respect for my colleagues to know that they are all aware of their responsibilities toward the Canadian people and particularly toward this least favoured class of Canadians. I say that to appeal precisely to their conscience as Canadians. Even if they have temporarily stilled it to satisfy certain electoral interests, the debate nevertheless should not be prolonged in this tone; on the contrary,we should remember that the poor are waiting for a bill.
The present bill may not be perfect, but it nevertheless represents something. Even if it is not perfect, let us pass it as soon as possible and try to pass others to remedy the situation within as short a time as possible. We will pass other bills sooner if we do not prolong debates in the house indefinitely.
Mr. Speaker, it is easy to use subjects such as this one to criticize the government. It is always easy, as a member of the opposition and as an independent member, to tell the government that it does not do enough: $100 is not enough, $125 is not enough. As an independent member I know that I will have nothing to administer tomorrow and no responsibility with regard to the national
719S

July 5, 1966
Canada Assistance Plan [DOT]budget, and I could very well tell the government that it should give old people $200, and then find people in my riding who would say that I am generous towards them. But this generosity would entail no responsibility. One should keep a sense of proportion and administrative responsibility.
It would be easy for me in my position to criticize all those who opposed the bill and say that they only did so for electoral purposes. I think too many did that; but I believe there are many left who were aware *of the needs of the poor and I think the government would be wise to hear the demands of those who made objective, positive and realistic representations.
Let us say to ourselves, for the time being, Mr. Speaker, and I believe it is the fairest way to put it-and you must admit I listened to everybody before rising to speak-that the bill as introduced by the government is a very elaborate one, representing a considerable improvement, compared with the present situation.
Countless poverty-stricken or underprivileged people in this country are waiting for those benefits. Let us put a stop to our endless debates, let us pass it as fast as possible and, if it is not perfect, we shall press the government to introduce further measures in order to improve the situation.
The government must remember that in the final analysis the stumbling block of all those measures intended to assist the underprivileged, the needy, is the manner in which the bounties of the nation are distributed among them, the way investigations are made; those are the things that should certainly be improved, humanized and made less vexatious.
Personally, although I know my province simply wants to be given back 100 per cent of the revenue sources and to administer freely [DOT]all those programs, although I hope there will [DOT]eventually be an agreement between my province and the federal government to that effect, I say that for the time being, things being what they are, this is a good and thoroughly acceptable bill and, for my part, I intend to support it by every possible means.


Edward Nasserden: It is with some sense of humility, Mr. Speaker, that I take part in this debate.


Some hon. Members:: Oh, oh.


Edward Nasserden: As I look at this bill and recall the election campaign I am reminded of the references to the war on poverty. I say to the minister that if this bill is to be the answer in that regard, then it falls short of the need that exists in our country today. Perhaps it will partially meet some of the problems, and the bringing together of the various welfare programs will make for greater efficiency of operation.
In so far as the old age pension is concerned, I recall that not only was the figure of $105 mentioned but also $125. There were some enthusiastic members of the party opposite who referred to the Canada Pension Plan during the election campaign and stated that the over-all effect would be to give the aged in our country something like $270 per month. This is something that should be borne in mind at this time when this measure is under consideration. All of this may have some element of politics within it.
The second factor that faces our elderly people today is the fact that the cost of living has increased as it has never increased before in the history of our country. They are faced with higher costs for lodging, milk, bread, clothing and almost everything they buy. These factors are the important ones in so far as parliament is concerned when it comes to the consideration of the welfare of these people who have gone through the pioneering era of our country. When you consider that there has been an 8 per cent increase in the cost of living during the last six months you find this puts an altogether different complexion on the adequacy of $75 per month.
I am surprised, sir, that this minister, representing a government whose leader has been stated to be a man who cares, should have been so slow to meet the needs of our senior citizens, so reluctant to bring forward tangible evidence of their good faith in the light of their promises during the recent election campaign.


The Acting Speaker (Mr. Rinfret):: Order. May I remind hon. members that if the minister speaks now he will close the debate.


Allan Joseph MacEachen: Mr. Speaker, in rising to wind up the debate on second reading of Bill No. C-207 I wish, first of all, to remind the house of the enthusiastic response which the resolution preceding this bill received from hon. members. This enthusiastic support of the legislation took place at a time when the principle of tjbe bill and the provisions of
Canada Assistance Plan the bill were being considered on their inherent value by hon. gentlemen opposite. This attitude continued until the hon. member for Winnipeg North Centre (Mr. Knowles) intervened with an amendment which was ruled out of order and about which I shall say more in the course of my remarks.
The hon. member for Simcoe East (Mr. Rynard) described the Canada Assistance Plan in the following words:	"The plan
before us is a good plan." The hon. member for Grey-Bruce (Mr. Winkler) stated that this proposal is a reasonably wise one and the sooner it is put into operation the better because it will be of benefit to the recipients. The hon. member for Portage-Neepawa (Mr. Enns), whose words in this debate have more significance than those of any other hon. member because of his experience in this particular field, made this statement:
-as a statement of intent, this resolution will commend itself readily to members of the house and all Canadians. . . . This measure can be an exciting, revolutionary step, perhaps the most revolutionary among the whole group of public welfare acts . . . The Canada Assistance Plan, if utilized responsibly and generously across Canada, will mean a long stride toward goals which welfare agencies have coveted for Canadian families.
The hon. member for Brandon-Souris (Mr. Dinsdale) says that this measure is an attempt to fill the gaps that have been left by existing plans. The hon. member for Saskatoon (Mr. Brand) states:
I sincerely hope . . . that the idea will be to provide rehabilitation if at all possible as the prime concern of this proposed plan, because I think it is so much more important to human dignity to give people the opportunity to fend for themselves and to provide for themselves.
Finally, the hon. member for Saint-Hyacin-the-Bagot (Mr. Ricard) described it as a brilliant statement of intentions. Even in the pre-amendment phase, the pre-political phase of this debate, the hon. member for Winnipeg North Centre told the house that it was most encouraging to learn there had been a wide measure of federal-provincial co-operation, which was very much to be commended, and that the federal government was prepared to share financially in a number of programs in which to this point there had been no federal-provincial participation. He said that when we weld together these programs and have federal-provincial co-operation, federal-provincial participation, the better it will be for all concerned. The hon. member for Winnipeg North Centre stated, "I welcome that progress .

July 5. 1966
Canada Assistance Plan
This measure might well draw these comments from hon. members opposite in the pre-amendment phase of the debate because the measure, on its merits and because of its provisions, deserves separate treatment and separate decision of the house. The Canada Assistance Plan, as has already been stated, will provide a basis for co-ordinating all public assistance programs in Canada. It will, over a period of time, replace existing categorical programs and enable federal and provincial governments to provide assistance to needy persons regardless of the cause of need. The plan will provide federal sharing for the first time in mothers' allowance programs covering 200,000 needy mothers with dependent children, and make it possible for these mothers and their children to receive assistance on the basis of need and on the basis of the family budget. Hardly a word was said in the debate with respect to this aspect of the Canada Assistance Plan.
[DOT] (4:00 p.m.)
The plan will provide federal support for the strengthening of the administration of, and the welfare services related to, social assistance programs. If the plan did not have the capacity to improve administration and to provide proper and qualified welfare services, then some of the comments made by members opposite would have validity.
The plan provides for federal aid for buttressing child and youth welfare agencies. For example, in the field of child and youth services, 50,000 children in the care of child welfare authorities in Canada will receive assistance under this plan.
In addition, Mr. Speaker, all the recipients of public assistance will for the first time have their health care costs met on this basis. There is no federal ceiling on the benefits under the new program, and the federal government stands ready to share with the provinces, on the basis of need, not only in the new categories or new groups which I have already mentioned but also in the improvement of the level of benefits now being paid to the recipients of old age assistance numbering 85,000, the blind numbering 8,000 and the disabled numbering 55,000.
Several hon. gentlemen opposite referred to the severe medical tests under the disability act. Through the Canada Assistance Plan any person who is disabled for any reason by disablement of any kind and to any extent will be able to be assisted without having to meet the severity of the medical test which has been so widely condemned by hon. members opposite.

The new cost to the federal treasury in this year will be $85 million. The total federal outlays in this fiscal year, 1966-67, will be $250 million and the total commitment by federal and provincial governments will be $500 million, affecting one million people who are to be covered under this program. In terms of the size of the expenditure involved and from the number of Canadians to be assisted, this program is to be a very substantial program indeed.
It has been suggested that the Canada Assistance Plan is only a tidying-up operation. It is true, as the hon. member for Perth (Mr. Monteith) pointed out, that it will bring together existing programs, we hope and give them a comprehensive foundation. But it is more than that. It attempts successfully to deal with the causes and effects of poverty.
The hon. member for Simcoe East (Mr. Rynard) pointed out the necessity for breaking the dependency cycle of families who, from one generation to another, are dependent on public welfare. You can dish out, Mr. Speaker, as much money as you like but this in itself will not break the dependency cycle; more than that is needed. The recipients of public assistance must be given a real chance to get off welfare, to break the dependency cycle, and because the Canada Assistance Plan lays the foundation to do this it is an important milestone in the history of public welfare in Canada.
The preventive and rehabilitative aspect of the Canada Assistance Plan is its positive aspect, and this has hardly been mentioned in this debate which has gone on for so many days. Hardly a mention has been made of the welfare services that will be available to recipients of public assistance, including counselling and training of various kinds, to help to solve these difficult personal problems that keep people on welfare.
Hardly a mention has been made of the work activity projects that will be supported under this plan, giving the opportunity to disadvantaged persons to resume gainful em-orientation, or to those who are handicapped ployment on the labour market through re-to be able to do something to become part of the productive population in Canada.
There has been hardly a mention in this long debate of the possibility under the Canada Assistance Plan of reaching agreements with the provinces by which the Indian population of Canada will be given an opportunity, in so far as welfare is concerned, to be treated as other Canadian citizens.
July 5, 1966

Understandably, hon. members have spoken a great deal about the needs test and the means test, and only one who has listened to every speech, as I have done, can appreciate the extent of the contradictory assessments made by hon. members of these two concepts.
Yesterday the hon. member for Cumberland (Mr. Coates) said that there was no difference between a needs test and a means test and he roundly condemned them both. On two occasions the hon. member for Danforth (Mr. Scott) repeated the same claim and condemned both concepts as being unworthy of any place in a public assistance program.


Eric Alfred Winkler: Would the minister permit a question? Does he know that one of his own supporters made a similar statement on Sunday in a nation-wide broadcast?


Allan Joseph MacEachen: No, Mr. Speaker, I was not aware of that particular occurrence. However, the hon. member for Portage-Neepawa (Mr. Enns), for example, extolled the needs test over the means test, saying that it provides all those things which contribute to the social usefulness of the citizen, and these are included in definitions of need.
The hon. member for Brandon-Souris (Mr. Dinsdale), who knows something about this field from personal experience, made this comment, as reported at page 6423 of Hansard for June 14:
My hon. friends in the N.D.P. seem to take great exception to this phrase a needs test, and are apparently equating it with a means test, which deals entirely with financial criteria.
He went on to say:
-the needs test is an attempt to deal with total needs ... of the person requiring this sort of assistance but also the cultural, psychological and even the spiritual needs.
Even I, Mr. Speaker, as the minister introducing the Canada Assistance Plan did not make that claim for the bill.
Then in the pre-amendment phase of the debate, the phase when the provisions of the bill were being discussed on their merits, the hon. member for Winnipeg North Centre made this comment, as reported at page 6414 of Hansard for June 14:
Sometimes people wonder whether a change of name makes for any real difference, but in the field of social work it does make a difference. A needs test is more humane and more realistic than a means test ... to move from a means test to a more advanced approach, namely the needs test.
Canada Assistance Plan [DOT] (4:10 p.m.)
So these are the words used to describe the needs test by the hon. member for Winnipeg North Centre: "A more advanced approach; more humane and more realistic."
There was a day in this house, Mr. Speaker, when hon. members heard supporters of the New Democratic Party asking and beseeching the government of the day to apply the needs test to the public assistance program of this country. I refer to the point of view expressed by the hon. member for Kootenay West (Mr. Herridge) who in this house quoted with approval a statement by the Canadian Welfare Council, advocating a program of social security in Canada based on need rather than means. The Canadian Welfare Council urged that categorical programs such as blind and disabled pensions and old age assistance be put on the same basis as unemployment assistance which used the needs test criteria. These are the words proclaimed by the hon. member for Kootenay West. "We in this group say amen to that statement of principle."


Stanley Howard Knowles: Is that your way of filling a spiritual need?


Allan Joseph MacEachen: Indeed, the first member of the New Democratic Party to be elected to this house advocated very early in his stay in the house that programs using the concept of need ought to be applied in Canada. So it is no wonder that those of us who have been working on the development of the Canada Assistance Plan felt that there was a broad basis of support for this concept in every political party, in every part of the house, judging by the statements made in this debate and earlier.
The fact is that the concept of the needs test has been either misunderstood or distorted in the debate. Naturally it is the objective of our other programs, of which we have a variety in Canada, including the Canada Pension Plan, and unemployment insurance, to reduce the area of dependency on public assistance. We are attempting to do that and will continue to do that, but there will be a need for a sound, humane program of public assistance in Canada if we are really serious about dealing with the causes and effects of poverty in this country.
The hon. member for York South (Mr. Lewis) in the most serious speech given from his group said that there were no standards in the Canada Assistance Plan. Well, that is

July 5, 1966
Canada Assistance Plan wrong because the bill itself provides that the basic requirements of recipients, including food, clothing, shelter, fuel, utilities, household supplies and personal requirements, must be met under the operation of this plan. Provinces must agree, under the agreement to be signed, to meet these basic requirements of individuals and provide them with adequate assistance to meet their needs. That is the standard.


David Lewis: Would the minister permit a question? I read, of course, the items which the minister has just stated. But would he indicate what standards are to be applied to those items? What are the standards of need that the provinces are to apply to those items which obviously make up anyone's living?


Allan Joseph MacEachen: Mr. Speaker, the standard is that through agreements the provinces will sign with the federal government the basic requirements of persons in need, including the items which I have mentioned, must be met in an adequate manner. That is the standard.


Mr. Cameron (Nanaimo-Cowichan-The Islands):: Would the minister define the word "adequate"?


Allan Joseph MacEachen: I had hoped to deal with that point a little later. The provinces will agree to meet these basic requirements. That is the first standard. There is also a further standard, namely, that no residence requirements will be required in the administration of this program in any province. Finally, any person will be able through an appeal machinery, something that has not been provided hitherto, to ensure that his proper rights will be met under this proposal.
The hon. member for York South said-and this was repeated by almost every other speaker after the amendment was moved -that the needs test was inhuman, inquisitorial and degrading. "It is humiliating; it will bring the public to their knees." Those were the words used by the hon. member for Burnaby-Coquitlam (Mr. Douglas). "It will bring the public to their knees". Imagine these words from a provincial premier who for 18 years administered means test programs in his own province-


Some hon. Members:: Hear, hear.


Allan Joseph MacEachen: -who later structured his own public assistance programs during his tenure of office and failed to eliminate the 
means test, who, according to my investigations, never made a request to any federal-provincial conference asking that the means test be removed from these programs which he as the head of that government administered. Yet in this debate when he is discussing this bill he calls the means test an affront to human dignity, humiliating, degrading, and says it will bring the population of Canada to their knees. No wonder at times people on this side of the house use the word "hypocrisy".


Some hon. Members:: Hear, hear.


Stanley Howard Knowles: Would the hon. minister permit a question?


Some hon. Members:: Oh, oh.


Allan Joseph MacEachen: Mr. Speaker-


Stanley Howard Knowles: Would the hon. minister permit a question?


Some hon. Members:: Oh, oh.


Allan Joseph MacEachen: -much has been said in the debate-


Stanley Howard Knowles: Would the hon. minister permit a question?


Allan Joseph MacEachen: -about the indignities of the means test.


An hon. Member:: Does the shoe fit, Stan?


Allan Joseph MacEachen: It was pictured by some hon. members as-


Stanley Howard Knowles: Would the hon. minister permit a question?


The Acting Speaker (Mr. Rinfret):: The hon. member for Winnipeg North Centre on a question.


Stanley Howard Knowles: In view of the references the minister has made to the administration of Saskatchewan by the present member for Burnaby-Coquitlam, can the minister tell me whether at any time the hon. member for Burnaby-Coquitlam introduced in Saskatchewan a means or a needs test in any area where there was not already one in existence?


Some hon. Members:: Oh, oh.


Michael Starr: He condoned it.


Allan Joseph MacEachen: I believe I stated, Mr. Speaker, that he introduced a means test in legislation when he could have brought in legislation on his own volition without a means test and had the liberty to do so.
July 5/ 1966


Stanley Howard Knowles: The minister has not answered my question.


An hon. Member:: Sit down.


Stanley Howard Knowles: I asked whether the hon. member for Burnaby-Coquitlam introduced a means test in any area where one did not exist, as the minister is doing in the old age pension area?


An hon. Member:: Sit down.


Allan Joseph MacEachen: Well, Mr. Speaker, I am arguing this particular point and I am referring to the stand taken by the hon. member for Burnaby-Coquitlam who spoke with such indignation and evangelical fervor in condemning the minister and the government for bringing the Canadian public to their knees. I am reminding the house to judge those comments on the basis of the same hon. gentleman's performance in administering these programs when he was premier of a province.


Michael Starr: For 17 years.
[DOT] (4:20 p.m.)


Allan Joseph MacEachen: This is my only point. The
idea has been put forward in this debate that the needs test is some sort of bargaining contest between the recipient of public welfare or public assistance and the welfare worker. I agree that in the past this attitude toward public assistance may have prevailed. But I am satisfied that with the improvement in the administration of welfare, and the provision of more trained and qualified staff, this attitude will go by the board under the Canada Assistance Plan.
I was somewhat amazed that certain members in this house who portray themselves as great humanitarians, suggesting that if they had administrative control over this plan they would apply it humanely, should intimate that all ten provincial administrations, no matter what their political stripe, were made up of inhuman Scrooges who would bring the public to their knees in the administration of this plan. I do not agree with that at all. I believe there is in every provincial administration a sentiment as strong as it is in this house in favour of assisting these disadvantaged groups which are to be helped by the Canada Assistance Plan.
A typical situation arises from the use of budget standards normally set out in provincial regulations based on budget studies. These studies indicate amounts necessary for
Canada Assistance Plan the various items of food, clothing, hospital supplies and personal needs of people who require assistance. The amounts in those tables are generally schedules derived from budget studies, a method which the hon. member for York South described yesterday as being sensible. The amounts derived from these studies are granted automatically. Frequently they are combined in a single item granted automatically. Additional amounts can be and have been paid to cover such important variables as shelter, fuel, utilities and special needs.
There are many examples in Canada of the needs test being administered efficiently with a minimum of detailed interrogation or investigation while achieving its central purpose of meeting the real needs of the individuals and families affected in addition to providing the necessary supporting welfare services-and this is even more important under the new regime and dispensation-which will rehabilitate these families and individuals and help them remove themselves from a state of dependency.
May I turn now to the unfolding parliamentary situation with regard to the Canada Assistance Plan? During the debate on the resolution stage of this legislation I had occasion to compliment hon. members on the constructive and non-partisan comments and suggestions they had made about this proposed measure. I regret, though I do not complain about it, that this commendable attitude has not been in evidence on second reading, all the more so because tactics of partisan sniping and procedural sabotage have been introduced into the debate by a section of the house which has come to regard itself as the custodian and repository of all that is good in parliament.


Some hon. Members:: Oh, oh.


Allan Joseph MacEachen: During the debate on the resolution the hon. member for Winnipeg North Centre described this plan as humane, realistic and advanced. He welcomed the progress which is being made. However, the hon. member appears to have undergone some mental or temperamental metamorphosis during the period between the debate on the resolution and second reading.
Suddenly the legislation has become a retrograde step and the humane and realistic proposal to pay benefits on the basis of need has become something involving merely a change of name, the same old means test dressed up a bit. That was the change which

July 5, 1966
Canada Assistance Plan took place between the resolution stage and the second reading. By Tuesday last the hon. member's metamorphosis had proceeded to a point at which he could rise in the house and resort to a procedural device in an attempt to kill the Canada Assistance Plan.


Some hon. Members:: Oh.


Allan Joseph MacEachen: The hon. member has tried-


Stanley Howard Knowles: I rise on a point of order. There is a rule in this house that one cannot impute motives. One has to take an hon. member at his word when he makes a statement. I made it clear that it was not, and never has been, my purpose to kill the Canada Assistance Plan.


Some hon. Members:: Oh.


Stanley Howard Knowles: I made it clear in a statement stronger than the minister has made that there are parts of the measure which are good and which I welcome. For him to criticize my amendment as an attempt to kill the Canada Assistance Plan is a distortion unworthy of the hon. gentleman.


Allan Joseph MacEachen: As I anticipated, the hon. member is continuing to disguise this effort under a cloud of pontifical verbiage. He has been in the house long enough and is sufficiently an expert on the procedure of parliament to know that no one moves an amendment on second reading, particularly an amendment of the kind he sponsored, without it having the express and calculated effect, if carried, of killing the legislation before the house.


Some hon. Members:: Hear, hear.


Allan Joseph MacEachen: If the hon. member says he did not intend to do it, that was not what I had in mind. If his effort had succeeded the bill would have been killed. That would inevitably have been the result. And the records of this house would show that he and his group-I was about to say "deliberately" but I will say "unwittingly"-sought to exterminate a measure which has been supported by all ten provinces, by the Canadian Welfare Council and by the Canadian Labour Congress as constituting a major advance in the field of social welfare.


Some hon. Members:: Hear, hear.


Allan Joseph MacEachen: The hon. member purports to like the legislation while at the same time he recoils at the prospect of its passage. The IMr. MacEachen.]
measure is a good one, but he undertook a procedural program which, if successful, would have killed the Canada Assistance Plan. Mr. Speaker, if that amendment had been ruled in order and had been carried, the Canada Assistance Plan would be dead.


Some hon. Members:: Shame.


Stanley Howard Knowles: On a point of order, Mr. Speaker, I should like to comment on the substance of what the minister has said but I shall not attempt to do so. Is it in order that this discussion should continue with respect to the point of order on which the Chair ruled on June 29.


Mr. Speaker:: I think the point is well taken. I am sure the minister would wish to return to the consideration of the bill which is now before the house.


An hon. Member:: Can't take it.
[DOT] (4:30 p.m.)


Allan Joseph MacEachen: Mr. Speaker, I accept your ruling. I will turn merely to one other point made by the hon. member for Winnipeg North Centre when he referred to a statement which I had used in introducing the second reading of the bill. I had referred to a quotation from the memorandum of the Canadian Labour Congress to the government. He pointed out that I had used a paragraph and had failed to complete the record because there was something else there. I should like to explain the situation. I was introducing the second reading of the Canada Assistance Plan, not the Old Age Security Act. The reference to which my hon. friend referred and which he accused me of failing to include was a reference to the Old Age Security Act. I repeat what I stated on that occasion as a statement from the memorandum to the government from the Canadian Labour Congress with regard to the Canada Assistance Plan:
We welcome the advent of the Canada Assistance Plan. We consider it to be an improvement over the categorical assistance programs now in effect. We agree that the change from a means to a needs-tested benefit, however subtle the difference may seem, will provide greater opportunities to provide an adequate benefit to those who will require assistance. We commend you for your decision to share with the provinces in the costs of allowances for needy mothers and medical care for the indigent, as well as the cost of improving administrative standards and of strengthening those rehabilitative services which will help to restore social assistance beneficiaries to a position where they are selfsupporting.
July 5, 1966

As my hon. friend points out, if it is a matter of substance I failed to mention the suggestion that there be a sliding scale of benefit in the Canada Assistance Plan. With that qualification the statement which I have read is a true and accurate reflection of the measure by the Canadian Labour Congress which the hon. member for York South (Mr. Lewis) described as a measure having little or no social thinking in it.
These are some of the points I wished to make in the course of the debate as I listened to the debate unfold. For a moment before my time expires I should like to pay some attention to my friend the right hon. Leader of the Opposition (Mr. Diefenbaker). The right hon. Leader of the Opposition had a great deal to say about the position the government has taken on this old age proposition. He accused us of adamantly ignoring the issue until recent days and asked why the sudden solicitude, why the newly cultivated interest on the part of the government and the minister in the old age pensioners of Canada.
Well, Mr. Speaker, the achievements of this government in helping the aged have already been placed on the record. The increase in the flat rate pension, the lowering of the eligibility age to 65 by 1970, the Canada Pension Plan, the measures embodied in the bill now before the house as well as our medicare proposals all have and will have a profound impact on the sense of security of our senior citizens. I suggest that this is a record of interest and concern for the pensioners of Canada which compares favourably with that of any previous government including the government headed by my right hon. friend. I should also like to tell him that his charge that there was an over-night change of heart by this government was unconvincing.
I should like to remind the right hon. gentleman that as far back as March 2 at a public speech in Regina, copies of which have been circulated, I pointed out quite clearly and unequivocally the need for additional assistance-


Mr. Speaker:: Order, please. I have to interrupt the hon. minister because his time has expired.


Some hon. Members:: Finish.


Mr. Speaker:: Has the minister the consent of the house to continue?


Some hon. Members:: Agreed.
7203
Canada Assistance Plan


Allan Joseph MacEachen: Mr. Speaker, I thank hon. members for their agreement. I have been waiting for it since last Wednesday.


David Lewis: We are all waiting for an announcement.


Allan Joseph MacEachen: I was reminding the right hon. Leader of the Opposition that in March at Regina I pointed out quite clearly and unequivocally the need for additional assistance for older Canadians covered only in part or not at all by the Canada Pension Plan. 1 should like to quote from that speech merely to put it on the record. I stated as follows:
These people will still be eligible for the flat-rate $75 a month universal pension but clearly this is not enough, or will not be enough, for many of them to live adequately and decently. What is the most practical and effective form of income maintenance for such older persons?
I then went on to examine some of the suggested approaches to this problem and said that various proposals were being examined by my department. I would note that in my statement on the adjournment motion on June 7, page 6123 of Hansard, I reiterated this government's intention to provide additional support for pensioners who are not able to take full advantage of the Canada Pension Plan. I was discussing this matter I believe in reply to a question raised by the hon. member for Winnipeg North Centre. I stated as follows:
I want to tell my hon. friend that this in a sense is the key problem in rounding out or adding to the support for the senior citizens-
I was referring to those senior citizens who will not benefit fully from the Canada Pension Plan. I went on to say:
Since I have taken over this job I have certainly been grappling with the most effective plan that can meet the problems and the needs of this particular body of people, and this plan-
To which I was referring and with which I was grappling on June 6.
-will be appropriately integrated with the Canada Pension Plan and the Canada Assistance Plan.
So I wonder how anyone can properly say there has been an over-night or sudden solicitude or change in interest.
[DOT] (4:40 p.m.)
Again, on June 14 during the adjournment debate I stated that the interest of the government in this problem will be demonstrated as we develop further programs of support for Canada's older citizens. All the statements had to do with the question of providing a

July 5, 1966
Canada Assistance Plan further program of additional support for Canada's old age pensioners. To any ordinary mind, uncluttered with partisan driftwood, they spell out quite clearly that the government is prepared to accept its responsibility in this field and to do something more for these people who are and will be primarily dependent on the flat rate $75 per month payment. Indeed, Mr. Speaker, I had in mind earlier in this debate to respond to invitations made by the hon. member for Comox-Alberni (Mr. Barnett) and the hon. member for Grey-Bruce (Mr. Winkler) to make a statement in this regard. But in the light of developments since then, and because of the importance which I attach to the Canada Assistance Plan, I consider it at this moment my duty and responsibility to seek a clear decision on this bill and its provisions aside and apart from any other consideration.


Some hon. Members:: Hear, hear.


Allan Joseph MacEachen: There are other considerations to which I have been referring and they are important but, as I say, I believe it to be my duty as the minister responsible for developing this bill to seek a clear decision on this legislation and its provisions. All who participated in developing this plan, including provincial governments and welfare authorities, are entitled to have it judged on its own merits. They are entitled to have it accepted or rejected on its own merits rather than by bringing in, no matter how important, any other subject as a basis for removing that opportunity of deciding on the merits of this bill.
It is true that the positive and constructive features of the Canada Assistance Plan have been buried in a long avalanche of vindictiveness and distortion. No person would disagree with that analysis of what has happened. I suggest that this legislation is in fact a realistic and serious attempt to meet the needs in this country of disadvantaged groups including the blind, the disabled, the unemployed, the aged and mothers of dependent children.
I feel beyond any doubt, Mr. Speaker, that this measure before us will bring new hope and the prospects of a more rewarding life to a considerable number of people in this country. This is a view that is shared by governments of all political complexions in this country and by those who are concerned with and involved in the problems of social welfare. I want to know whether this house shares this view, and that is why the Canada

Assistance Plan must be dealt with on its own two feet. To paraphrase the memorable words of the Leader of the Opposition, you ask where we stand, I want to know where you stand.


Some hon. Members:: Hear, hear.


Allan Joseph MacEachen: The Canada Assistance Plan deserves to be given its own distinct treatment and to have each of its features judged on its own merits in order to have its beneficiaries, numbering a million people, treated as free citizens entitled to separate consideration by this house, along with other deserving persons including senior citizens.
I do not dispute the high-mindedness of hon. members' purposes or the sincerity of their motives. It is not for me to question the accuracy of their claims, but it is certainly open to me to point out the varying routes by which they come to these sometimes opposite self-assessments, and especially their assessments of this bill.
The hon. member for Winnipeg North Centre welcomes the removal of the means test provided for by this program while the hon. member for Danforth throws up both hands in horror. The hon. member for Portage-Neepawa holds out high hopes for the plan while his esteemed leader labels it a "charade of hypocrisy". The hon. member for Greenwood (Mr. Brewin) is prepared to accept, sight unseen and sound unheard, the constitutional tenets of his party's Quebec leader while the hon. members for Van-couver-Kingsway (Mrs. Maclnnis) and York South (Mr. Lewis) are almost embarrassingly enthusiastic in their espousals of what I am sure would be heretical nonsense to the N.D.P. co-leader in Quebec.


Some hon. Members:: Hear, hear.


Allan Joseph MacEachen: What this house is now
considering is the Canada Assistance Plan, a measure which has received the endorsation of Canada's ten provincial governments, of the Canadian Labour Congress and the country's leading social welfare organizations. An amendment having to do with old age pensions was ruled out of order earlier in this debate on the ground that it was irrelevant. It is not unfair to suggest that most of the subsequent debate falls in the same category. The Canada Assistance Plan must stand on its own feet. It must be judged on its own merits and members must now make their decision solely on the individual provisions of this legislation and not on issues which lie outside the scope and jurisdiction of this bill.
July 5, 1966

Canada Assistance Plan
The old age pension question is another, Mr. Knowles: -a clearer and more ringing distinct issue, and I can assure hon. members endorsation of this bill than he had uttered that it will be dealt with in another and more himself. But there are some things the minis-appropriate context and, I would add with ter has said to which attention should be equal assurance, within a very short time.	drawn.


Some hon. Members:: Hear, hear.


Mr. Speaker:: Is the house ready for the question?


Some hon. Members:: Question.


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


Some hon. Members:: Agreed.
And more than five members having risen:


Mr. Speaker:: Order, please. The motion has been carried.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Batten in the chair.
The Chairman:: Order. House in committee of the whole on Bill C-207, to authorize the making of contributions by Canada toward the cost of programs for the provision of assistance and welfare services to and in respect of persons in need.
On clause 2-Definitions.


Stanley Howard Knowles: Mr. Chairman, clause 2 has in it a good many definitions and in fact covers the whole range of Bill C-207. I should like, therefore, in my first words on this clause to say that I am delighted that the House of Commons has supported Bill C-207 unanimously. It appears that there was not a single "nay" anywhere so that it was not even possible for the government to force a recorded vote. I want to say to the Minister of National Health and Welfare, despite the things he just said in the speech he made on second reading, that I still think the Canada Assistance Plan with respect to what it does .s a good piece of legislation.
[DOT] (4:50 p.m.)


Some hon. Members:: Oh, oh.


Stanley Howard Knowles: I said so very clearly when we were debating the matter at the resolution stage. I said so with equal clarity when we were on second reading.


Some hon. Members:: Order.


Stanley Howard Knowles: As a matter of fact, the Minister of National Health and Welfare Eound in statements that I made on second reading-


William Heward Grafftey: Order.


William Heward Grafftey: Not at committee stage.


Stanley Howard Knowles: Mr. Chairman, my hon.
friends are shouting "order". The whole legislation is before us and my hon. friends might as well save their breath as to shouts of "order" at this point. We are in committee of the whole and what is relevant to clause 2 is now before us. Clause 2 contains all the definitions that relate to the Canada Assistance Plan. The whole of this piece of legislation is in effect before us in the very wording of clause 2. It includes, amongst other things, a reference to the needs test.
I want to say to the Minister of National Health and Welfare that even though he was waxing eloquent in his rhetorical flight he should not have distorted what I said about the needs test. I said it clearly on two occasions. I said that the needs test is an improvement on the means test. I said I was glad to see that where we now have means testing we are making the forward step of moving to needs testing. When I made very clear my approval of the needs test as better than a means test where there is now a means test, it did not mean that I approve of a needs test being established where there is not now a test of any kind. My complaint with regard to Bill C-207, and it is right here in clause 2 of the bill now before us, is that a needs test is being introduced for persons in the old age security bracket. These people are having a needs test put on where they now do not have a means test or any test whatsoever. It is about this that we complain. It is against this that most of the speeches on this side in the last few days have been directed.
I remind the Minister of National Health and Welfare that when I spoke the second time on this question I asked him to be fair and not to misquote what I said on a previous occasion. But he chose to misquote it and interpret my approval of a needs test as better than a means test as meaning that I accept a needs test any place at all. I say again so that anyone other than the minister, I am sure, can understand it, that where we now have a means test it is good to have an improvement and have the needs test put in its place. But it is still a retrograde step, for which this parliament should hang its head in

July 5, 1966
Canada Assistance Plan shame, that in the terms of clause 2 of this bill we are introducing a test in an area where we now do not have one.
The parliament of Canada in 1951 took one of the most advanced steps it has ever taken in the field of social legislation by passing an act that removed the means test for persons 70 years of age and over. Only a few months ago the parliament of Canada extended this progressive step by making provision for the means test to be removed year by year right down to the age of 65. It was a good step when we took it in 1951. It was a good step when we took it last year. But what the minister is asking parliament to do now is to take the retrograde step of putting a needs test in where there is no test of any kind at the present time.
My statement, the statements of my colleagues and the statements of members in other parties that this is a retrograde step, that this is an affront to the dignity of our senior citizens, is one that stands up in light of the speech the minister has made. He has invited us to argue this point and I hope we can yet persuade him that whatever the parliament of Canada proposes to do for our older people should be done without a means test or a needs test of any kind.
Clause 2, as I say, covers all the various definitions including that of need, and it includes the word "age", making it clear that at the moment this is what the government of Canada is proposing to do for our aged people, namely, give them only the benefits that are in this bill. Therefore it seemed to me that it was not only appropriate for members of the House of Commons to argue that something better should be done for our senior citizens than was provided in this legislation, but I think it was appropriate for the minister to tell us on several occasions that if we would just let the debate on second reading end he would respond to those suggestions and tell us what the government was going to do for senior citizens. Not only did he tell us that in the house, not only was this his answer and the Prime Minister's answer when we asked for a statement on motions, but in ways this government has the information was leaked out that if only the debate on second reading would come to an end the minister would make a statement telling us the government's intentions with respect to the recipients of old age security.
But now the minister, having finished his statement, decides to get on his high horse and he says he is not going to give us this

information at the present time. I submit that the Minister of National Health and Welfare misled the house and misled the country by telling us that this statement was going to be made when he concluded the debate on second reading and then standing up this afternoon and refusing to make that statement.
I told the minister when we were at the resolution stage that it struck me the reason he was not telling us then what was going to be done for the senior citizens was that he was ashamed of it. I suggest that the same reason probably applies now, that he is not prepared to tell us what the government proposes to do later at some time for the recipients of old age security because he knows it will not stand up to the standards that have been established during the course of this debate. He knows it will not stand up to what the Canadian people expect.
I have been in this house a little bit longer than he has. I am a little bit older, and I can tell him-


Herman Maxwell Batten: Order. I must say to the hon. member for Winnipeg North Centre that the Chair is having some difficulty in relating the remarks he is now making to clause 2 of the bill.


Stanley Howard Knowles: Mr. Chairman, if you look at clause 2 (g) on page 3 of the bill you will find a definition of "person in need". It is a lengthy one and I do not think I need read it all, but it includes the various reasons on the basis of which persons may receive assistance under this act, and one of them is age. I suggest, Mr. Chairman, that age is definitely before us as one of the matters with which this piece of legislation is supposedly dealing. I suggest that the minister was perfectly in order in telling us that he was going to deal with this question when we got to the end of the debate on second reading, but that he has in fact misled the house and the country by giving us that impression and now refusing to make the statement.
[DOT] (5:00 p.m.)


Allan Joseph MacEachen: I wish to rise on a point of order, Mr. Chairman. Will the hon. gentleman produce any quotations of a statement that I made to the effect that I would make a statement at the end of the second reading along the lines he suggested? Will he show it to me?


Stanley Howard Knowles: It will take me time to find the references in Hansard and to quote them to the minister.


Some hon. Members:: Oh, oh.
July S, 1966

Canada Assistance Plan


Stanley Howard Knowles: Hon. members on the opposite side should keep calm. There is plenty of time. One can speak as often as he wishes at this stage of debate and I will have time to look up the references in Hansard. My memory is quite clear in this regard. The minister said that if we would allow debate on second reading of the bill to come to a conclusion he would make a statement at that time.
On one occasion a few days ago both the Leader of the Opposition and I asked the Prime Minister whether the government, either through the Prime Minister or through the Minister of National Health and Welfare, would not make, on motions or on orders of the day, a statement on what the government was going to do with regard to old age security recipients. The Prime Minister answered by saying that the proper place for the minister to make such a statement was in closing the debate on second reading of the bill on the Canada Assistance Plan.
One of my colleagues has handed me a newspaper article headed "Aged Wait As Debate Drives On", a story by Fraser Kelly of the Ottawa Bureau of the Toronto Telegram, similar to many other stories I read.


An hon. Member:: This is another filibuster.


Stanley Howard Knowles: The plan was that when debate on second reading ended the minister would make a statement. In the statement he has just made he admitted that we were expecting it but he said that since he gave that undertaking he had made the decision that a vote should be taken on the Canada Assistance Plan with respect to the welfare matters it covers and therefore the making of a statement on old age security should wait. The minister can explain it any way he wishes but at a later stage in the debate I will bring before the committee the exact quotations from Hansard in regard to his previous undertaking.
I wish to say to the minister that there will be keen disappointment across Canada tonight, and the bushels of mail I have received in the last few days will be multiplied as a result of the publicity which the minister has given me today. There will be bitter disappointment at the fact that whatever the government had in mind the minis-er decided not to give it to us. All of this talk that we were preventing him from making a statement because the debate went on for three and a half days, which was called a filibuster, is really ridiculous. It has turned out to be nothing but a sham.


Some hon. Members:: Carried.


Stanley Howard Knowles: Some of my colleagues have shown me the references in Hansard. I will read them the next time I rise to speak. I will come back in a moment to what the minister calls the pre-political part of my speech. He can use such adjectives if he wants to but he is inviting a rather heated debate at this point.
I wish to say again, Mr. Chairman, that I think the Liberal government is making a serious and tragic mistake on every count by refusing, at this time and concurrently with this legislation, to deal with the problem of the income of our old age security recipients. It is the kind of mistake which the Liberals have been making throughout the years. They made it by taking so long in presenting old age legislation in the first place and in responding to the requests for an increase. They made it by refusing for so many years to remove the means test, and they made a tremendous mistake in 1957 when they provided a $6 increase. They are making it again when the country wishes to do the right thing by our elderly people who are in financial difficulties, when the country wishes the pension to be increased to $100 a month across the board without a means test, by not even telling us what are their plans after having led the whole country to believe that this would take place. Why are so many members of the press gallery present this afternoon? Are they here to listen to the minister's attack on me?


An hon. Member:: No, to listen to you.


Stanley Howard Knowles: They are here because they hoped to hear the statement which the minister was going to make. I suggest to you, Mr. Chairman, that not only will the senior citizens who are affected by this plan be bitterly disappointed but so will all the people of this country because Canadians as a whole are concerned about the plight of the elderly.
Despite the words that have gone back and forth across the chamber this afternoon I wish to say again, as I said at the resolution stage and on second reading, that I think what this legislation does, apart from the things it fails to do, is good. I welcome the proposal that federal money should be allocated to some of these welfare needs. I welcome the proposal that the federal government should support welfare services as well as assistance payments, mothers' allowances, child welfare, Indian welfare, work projects and so on.

July 5. 1966
Canada Assistance Plan
I suggest to the minister that he is a little off base when he tries to have it both ways. He quoted the hon. member for Portage-Neepawa, myself and perhaps some others as pointing out the good aspects of this legislation, as we did, and then he said that hardly a word was said about the good features of this legislation.
Which way does the minister want it? The fact is there are good features in it and many hon. members both in the opposition and on the government side have said so. I hope, however, that even though we recognize the forward step being taken we can have an objective discussion in committee of the whole to ascertain exactly to what extent we are moving in these various fields.
As I said, clause 2 includes definitions of the various fields which will be covered, such as day care, homemaker services, mothers' allowances, child welfare, adoption services and so on. The minister made a great play about the amount of money that will be put into this plan by the federal government during the first year. He has told us a good many times that it adds up to a sum of $85 million. Whether we consider it under this clause or under some other clause, I hope the minister will be prepared to discuss with us in some detail how this money will be allocated and what the various sections of this program will get in terms of actual dollars. Either the minister can inform us of this or his parliamentary secretary can because, being a member of the committee on health and welfare, she knows that a good deal of this information has been given to us in that committee. Under normal circumstances I would take the position that information given to us in the committee is sufficient but the minister has made such boastful claims about this legislation here in this forum that it seems to me the country should get the whole picture.
I will quote the figures which we were given when we get to another clause of the bill and I will only say at this time that these figures show that the $85 million is broken down into about six or seven different categories. For example, when we wanted to know how much of this money will go to help the provinces pay extra benefits to old age security recipients we found there was no such category but there was a category called "program improvements" with an amount of $15 million for all program improvements. That makes it pretty clear that not much of that sum will go to old age security recipients.
In speaking about the welfare aspect of the program let me say that one of the strong points-and the minister made much of it this afternoon-is that the aim of this legislation is to try to get people free of dependency. He quoted the hon. member for Simcoe East who spoke about the desirability of such action, and we all agree with him. The minister said that this legislation proposes to give people a chance to rise above welfare and he said that the Canada Assistance Plan lays a foundation to make this possible. At that point hon. members on the Liberal side of the house loudly applauded.
[DOT] (5:10 p.m.)
In the committee on health and welfare we tried to find out how much of this $85 million, which after all is not very great in total, is going toward the provision of additional services, that is, services as distinct from assistance payments, services to help people get on their own, services to rehabilitate and so on. We could not get an exact figure, but by adding together the various figures we were given by the officials we built the total up to $14 million or $15 million a year. I just do not see that amount, good though its provision is in principle, doing much of a job along the lines the minister has proposed.
I recognize and will assert that in principle it is good for the federal government to get into the business of providing more money for welfare services. I think it is especially good that there is some kind of understanding among the 11 governments of this country, the federal government and the ten provincial governments, to work together in this field.
However, Mr. Chairman, when an offer has been made to the provinces to pay 50 per cent of all the extra money over the base period that the provinces will spend on welfare services, when there has been this agreement and the provinces indicate to the government that the extent or their total calls on this part of the fund for the first year is going to be only $14 million or $15 million, it strikes me that the selling job has not been as good as it might have been. This morning in the committee on health and welfare I quoted a report from one of today's newspapers to the effect that certain services would be available to municipalities in the province of Ontario for example, on a much more favourable basis than has been the case thus far. However, it was open to question whether or

July S, 1966

not the municipalities would avail themselves of these services. This is something, under the heading of what is good in the bill, that I want the minister to be prepared to discuss in full when we reach that clause. I cannot forget what the measure does not do for old age security recipients, but I also want to discuss what the measure does not do in terms of what the minister says it is good for. I suggest we should have a down-to-earth, realistic discussion of this aspect.
So, Mr. Chairman, I think perhaps I have said enough at this point on clause 2. I will accept the minister's challenge to read back to him at a later point undertakings he made which I submit he has not kept by not giving a statement on old age security. I say to him, in light of the fact this bill is supposed to do something to meet the needs of our senior citizens, that the position he took in the last sentence of his speech is a bitter disappointment.
I have, as all hon. members have, during the past few days received a tremendous amount of mail from senior citizens. I brought some of the letters with me thinking I might read from them but I will leave that to a later stage. There is one from which I should like to quote a bit.


An hon. Member:: Oh, no.


Stanley Howard Knowles: My hon. friend says, "Oh, no". Perhaps he would enjoy this letter since it comes from Hamilton. Is there anybody here from Hamilton? I read:
Dear Sir:
So they think you are making a play for headlines (and so you are) and all us old people are behind you. God bless you and your followers; the best of luck to you.
I also received a telegram from Winnipeg which reads as follows:
As I said before, may I again recommend that you continue to explore all possible avenues in an effort to immediately raise old age pensions to $100 per month without means tests.
After a few sentences we find this:
Canada Assistance Plan operated through provinces with means test with various interpretations placed on them is not a satisfactory alternative, to which many Canadian citizens will testify.
I regret to say that I do not know the actual sender of this telegram but he signs himself, "Concerned Liberal Citizen".


An hon. Member:: You don't mean he trusts you?


Stanley Howard Knowles: Would hon. members like me to read them all? Far more interesting than
Canada Assistance Plan the letters I am quoting, Mr. Chairman, would be the letters they are receiving on the government side of the house. As a matter of fact, I think that is what stung the minister into making his statement. I know what the people are writing to me, so I know what they must be saying to the government.
I want to repeat the position I have taken on two previous occasions, and the minister has no moral right to distort it. I took the position earlier, and I take it now, that the parts of this legislation which improve the administration of welfare are good. There are some deficiencies, but I hope we can iron them out as time goes by. In the main they are good and this is the reason hon. members voted for this bill unanimously. However, the failure of this government to face up to the problems of our senior citizens, the failure of the minister to say something in his statement, is a disappointment like so many of the disappointments the government across the way has given us.
I call upon this government to face up to the fact that Canadians want this parliament to do the right thing by our senior citizens. The only thing that is right is to increase the old age security pension to not less than $100 a month without the reintroduction of a means test or a needs test or any indignity of any kind.


John B. Stewart: I move, Mr. Chairman, that the committee rise, report progress and ask leave to sit again later this day.


Mr. Rynard:: Before we proceed with this motion, Mr. Chairman, I should like to draw the attention of the minister to a statement he made that nobody had referred to the
200.000	women-


Herman Maxwell Batten: Order, please.


An hon. Member:: There is a motion before the committee.


Philip Bernard Rynard: I have a right to make this statement. The minister said no one referred to the 200,000 mothers. If he refers to page 6410 of Hansard he will find that I said this was a good framework within which to gather together all the loose ends such as unemployment assistance and so forth. The minister said that I believed it was a good plan and that is exactly what I said because there were too many loose ends. I also went on to say that the only addition to the plan was the
200.000	mothers. I am sure the minister would like to correct that statement.
July 5, 1966

Canada Assistance Plan


Allan Joseph MacEachen: Yes, I accept the hon. member's correction. I regret that I did not add that point to the commendation he made of the plan.


David Lewis: A motion has been moved by the parliamentary secretary, but would he be good enough to tell us the reason for it?


John B. Stewart: If it is in order to speak on this motion-


Herman Maxwell Batten: No, it is not in order to speak on the motion. A motion to rise and report progress is not debatable. Is it the pleasure of the committee to adopt the motion?
Motion (Mr. Stewart) negatived: Yeas, 21; nays, 32.


Herman Maxwell Batten: I declare the motion lost.
[DOT] (5:20 p.m.)


Mr. Baldwin:: Mr. Chairman, I should like to ask a question on clause 2. I have had some difficulty in following the debate with regard to this question and I hesitated to refer to the bill in detail on second reading because I might have been called to order. I want to ask the minister a question with regard to the definition in clause 2 (g) "person in need". I have been trying to discover the very fine distinction which exists between a means test and a needs test. Definition (g) is as follows:
(g) "person in need" means
(i) a person who, by reason of inability to obtain employment, loss of the principal family provider, illness, disability, age or other cause of any kind acceptable to the provincial authority, is found to be unable (on the basis of a test established by the provincial authority that takes into account that person's budgetary requirements and the income and resources available to him to meet such requirements) to provide adequately for himself, or for himself and his dependants or any of them-
I take that wording to constitute a mandatory direction to the appropriate provincial authority, in establishing who is a person in need, to take into calculation the means of that person. I would ask the minister whether I am correct in assuming that the needs test, which is given a statutory definition here, contains an element of the means test.


Allan Joseph MacEachen: Mr. Chairman, the answer is yes, it does contain an element of the means test.


David Lewis: Mr. Chairman, I am not going to keep the committee very long. Nor am I going to attempt to deal with the many parts

of the minister's speech which I respectfully suggest to him were an exercise in distortion such as I have seldom heard in my life.


Some hon. Members:: Oh, oh.


David Lewis: I rise to make two points. I am one of those who are unhappy about the requirement of a needs test, though as I said on an earlier occasion it is obviously an improvement on the means test. Of course I knew, as the minister a moment ago admitted, that a needs test necessarily included a means test as well. Certainly to require that account be taken of the budgetary requirements of a person as well as his means is an improvement. That is why I was pleased to vote for the bill, as I said I would on second reading and as also did others in this house.
However, I repeat what I said. No matter how glowing the words the minister may use in describing this bill, no matter how much he may draw upon witnesses outside the house such as the Canadian Labour Congress, welfare councils and the like, and no matter how much his advisers may insist the bill is great, I say to him that, improvement though it may be, the needs test remains a humiliating affair, as does any test for the purpose of dealing with people in need which requires an assessment of their livelihood.
People live in different ways. People expend their resources, large or small, by different choices, and any test that is applied to them is humiliating. If I and others failed to make ourselves clear earlier in expressing our disappointment at the bill, then let me try again.
It is my conviction, one which others share with me, that the only way to eliminate poverty in this country, aside from job provision and the like, is to have some general program of income maintenance. We require some general program providing a guaranteed annual income for a person or a family through the application of a negative income tax or some other method whereby, without the humiliation of a test and by a simple declaration of personal income, society makes up the difference between what a person or a family in fact has by way of income and that which, according to budgetary analyses, that person or his family requires to live on in their way, not in my way or in the way of the social welfare worker but in their way. So long as we are short of the goal of a guaranteed income for the needy, so long we will have humiliating situations, whether caused
July 5, 1966

by needs tests, means tests, or whatever they may be called.
Second, I should like to say that when the minister said if I remember his words correctly, in his speech closing the debate on second reading that by various programs the government intends to reduce the number of people who have to rely on public assistance, I say to him that the major reason that this party-and I can only speak for this party-made the stand it did with regard to old age security recipients is precisely that. In order to reduce the number of persons, particularly among our aged people, who will have to rely on public assistance, let us make a universal payment to the old age pensioners when they reach a certain age-we say age 65, to which the government agree except that they postpone the payment until 1970 in their legislation-of at least $100 a month. In this way you reduce not only the number of people who will have to apply for public assistance but you also reduce the requirement for public assistance of those who still have to seek it to provide the balance they require to live decently.
In this speech on closing the debate on second reading the minister made a point of reading extracts from other members' speeches. He accuses other people of hypocrisy. I have had short experience in this parliament but I am sure that other members, including the minister, are as fed up with this sort of thing as I am. I did not accuse him of hypocrisy but he accuses me of hypocrisy. When I say me, I do not mean me personally. He did not name me but he said at one point in his speech, "No wonder some members on this side used the word 'hypocrisy'". He said that in one of his more rhetorical passages.
Let me tell him in measured words that only a guilty conscience could have interpreted-


Some hon. Members:: Oh, oh.


Mr. Mcllraiih:: Order.


David Lewis: -what was said in that way. What we said to him, and what we say to him again, is that we feel it is our duty to keep on fighting for an improvement in the amount paid by way of old age security and we do so with a clear conscience, as we have done.


Some hon. Members:: Oh, oh.


David Lewis: Clarity of conscience-I am sure hon. members across the chamber will agree
Canada Assistance Plan with me-exists not only in one part of the house. We can lay some claim to it as well as the minister of mines and energy, and we do so with the same humility which he is showing now.
[DOT] (5:30 p.m.)
Finally, Mr. Chairman, I want to direct the minister's attention to this simple matter. The minister interrupted the speech by the hon. member for Comox-Alberni as reported on page 7063 of Hansard. I quote the words of the hon. member for Comox-Alberni:
I wish the Minister of Finance would come into the house right now and tell us why the government does not support the simple and immediate proposal we are making. Somehow I feel it is almost unfair of me to ask the Minister of National Health and Welfare to stand up and do it. He does not appear to be giving any indication of a desire to get up on his feet at the present moment.


Allan Joseph MacEachen: May I, Mr. Speaker?


Thomas Speakman Barnett: If he could give me some indication that that is what he has in mind, I would be quite happy to terminate my remarks at this point.
Mr. MacEachen. I am ready, Mr. Speaker.


Thomas Speakman Barnett: Does the minister wish to ask me a question?


Allan Joseph MacEachen: I accept the hon. member's invitation if he will sit down and allow me to wind up the second reading of this bill by making a statement.
After an exchange with the hon. member for Grey-Bruce, at page 7069 of Hansard the hon. minister said:
Yes, Mr. Speaker. I wish to reply to the point of order raised by the hon. member for Grey-Bruce. He was given a full opportunity to present his point of order and I should like to reply to it by saying that this is the second time tonight hon. members have asked me to reply on this general subject-
And the general subject was the old age pensioners.
-and make a statement with regard to the intentions of the government. Twice I have volunteered and have been refused. I am waiting anxiously to conclude this debate in order that the bill will be passed and so that the house will be fully aware of the government's plans.
If those words are not a clear undertaking that when the minister closed the debate he would make a statement on the subject of old age security and what the government's intentions are, I just do not understand simple English.
On June 30, as found on page 7080 of Hansard, the hon. member for Winnipeg North Centre asked this question:
Mr. Speaker, before we leave the order of motions, is it not the intention of the Prime Minister or the Minister of National Health and Welfare to make a statement on the government's intention with respect to old age security?

July 5. 1966
Canada Assistance Plan
The answer is recorded as follows:


Lester Bowles Pearson: Mr. Speaker. I understand we are debating the Canada Assistance Plan, and that will be a good occasion for the minister to make a statement.
Following those statements by the minister and by the Prime Minister, and the obvious leaks to the press which had all sorts of stories about what the content of the statement would be, I suggest to the minister, without accusing him of anything, that the time has come, and that time is now, for him to make this statement. He has second reading of the bill. He wanted a recorded vote. He would have got it too but he was slow in rising. He had made a long and tiring speech, as tiring to him as it was to those he attacked. But I say to him that he got approval on second reading. He got unanimous support of the principles of the bill. I say to him that in all honesty to the house, in all honesty to the older citizens of Canada, in all honesty to the people of Canada he owes it to them to rise and to tell us now what his intentions and the intentions of the government are.


Some hon. Members:: Oh, oh.


David Lewis: I can understand, although I could not appreciate, the reasons he appeared to have for refusing to make a statement on second reading. He said he wanted this bill to stand on its own feet.


George James McIlraith: Mr. Chairman, second reading of the bill has been passed on by the house after full opportunity for debate. The matter now before the house is clause 2 of the bill. It is not open to hon. members, in the committee stage when we are discussing particular clauses, to use that opportunity to continue the debate on second reading. It is not open, in other words, to hon. members to obtain by that device two opportunities to speak on second reading. The clause before the committee of the whole at the moment is clause 2 and debate now must be relevant to that clause. To continue and rehash the general debate on old age pensions and second reading in the specific form in which it is being done by the hon. member is, I respectfully submit, out of order.


David Lewis: Mr. Chairman, I have not been here nearly as long as the Minister of Public Works. Let me say first on the point of order that, as the hon. member for Winnipeg North Centre has pointed out, clause 2 deals with aged people. It specifically refers to them. It

specifically refers to a definition of need with respect to aged people.


George James McIlraith: Would the hon. member permit me to ask him a question?


David Lewis: Certainly.


George James McIlraith: On the point of order that I raised, would the hon. member not admit that he has been and is dealing specifically with the arguments on second reading again and that-


David Lewis: Not at all, Mr. Chairman. I understand that the Minister of Public Works is anxious, as we all are, to end the session and to deal with all the business we have before the recess that all of us deserve. But let me, as a relatively new member of this house, tell him that when he uses words such as "rehash" and the like he is going to be here just as long as it is necessary to make our points. And I do not appreciate-


George James McIlraith: On a point of order-


David Lewis: -any remarks-


Some hon. Members:: Oh, oh.


Maurice Rinfret: Order, please.


David Lewis: Mr. Chairman, I merely want to tell the minister that as one member of the house I do not appreciate and I do not propose to tolerate that kind of characterization of anything I have to say when I am on my feet.
I say to the minister in reply to his point of order that the word "age" is in this bill. I have no idea what the minister's announcement may be. According to what I have read in the press the announcement may well deal with the way in which the Canada Assistance Plan will provide, in the minister's opinion and that of the government, additional assistance for the aged. I have no idea what his announcement will be. I venture to say from what I have read in the press that his announcement will be precisely within the ambit of clause 2. The Minister of Public Works, it seems to me, is not on very strong grounds when he objects to my asking the minister under clause 2, which deals with the need of old people, for an announcement which he undertook to make, has not yet made and which the entire country expects him to make.


Allan Joseph MacEachen: Mr. Chairman, we ought to put this into perspective. Last Wednesday night the hon. member for Comox-Alberni
July 5, 19S6	COMMONS
volunteered to terminate his speech to allow me to wind up the debate. I said I would do so and I would disclose then and later the intentions of the government. I mentioned today that I was considering doing that at the time. Today I have indicated the intentions of the government with respect to old age pensions. But I wanted to have this measure dealt with on its merits and disposed of, because the other matter is another issue which will be dealt with within a short time.
I went much beyond that and stated that we would be dealing with a further program.


An hon. Member:: When?
[DOT] (5:40 p.m.)


Allan Joseph MacEachen: Surely that is completely in accord with any undertaking that may have been given at that time, which was totally conditional upon the opportunity being given that evening. It was not granted, and I do not complain about that at all. Surely I have discharged fully the undertaking, which was conditional, that I would disclose the intention of the government. I have disclosed it today. I have not disclosed the details of any plan and I never said I would. But certainly I have disclosed the intention of the government.


Some hon. Members:: Hear, hear.


John George Diefenbaker: I do not want to impel myself into the internecine strife which has broken out between the allies, the Liberal party opposite and the New Democratic Party. It is discouraging to see such a division and I only hope something can be done to bridge the chasm created between them. Throughout the entire session and, indeed, for several previous sessions there has been a beautiful relationship between those two parties and I want to do everything I can to heal the wounds which are apparently being inflicted.
I must say it is most unusual that the Minister of Public Works should rise and say there should be no general discussion on clause 2. This practice has always been followed-


Some hon. Members:: On clause 1.


John George Diefenbaker: -particularly when what is asked for has a full and complete relationship with the matter before the committee.
I was surprised to see in the Montreal Star metro edition this evening the headline: "Ottawa Prepares To Shelve Debate On Assistance Plan". Apparently the government 23033-4571
DEBATES	7213
Canada Assistance Plan is prepared to shelve this legislation. The article says:
Government house leader George Mcllraith told the Montreal Star last night he is seriously considering withdrawing the welfare bill and moving on to other legislation "if we are going to continue to sit around here doing nothing."


George James McIlraith: I wonder whether the right hon. gentleman would permit me to help him. My first request is that he try to approximate the pronunciation of my name. That is the important point. But the second point, which I might clear up at once, is that there was no suggestion that the government was going to withdraw consideration of the bill. No thought or consideration was ever given to that.


John George Diefenbaker: So far as the first matter is concerned, I must immediately apologize. I get "micks" and "macs" mixed up sometimes. I did in this case.
But let me read on, because I am disturbed by this.
Seldom angered by opposition floor tactics, Mr. Mcllraith charged: "It has been quite apparent to all that it is not very easy to assess whether the house is interested in proceeding with the consideration of the Canada Assistance Plan."
And this is all in quotes. If the minister says he did not say it, all I have to tell him is that the Star has indiscriminately used quotation marks when they ought not to have been used. I read on:
The house leader said that "continued opposition to an important piece of legislation such as this is not conducive to maintaining the high opinion which we hope this parliament holds in the minds of the public."


George James McIlraith: That is in Hansard.


John George Diefenbaker: I am sure all of us are
exhilarated to think that parliament holds a high position in consequence of the co-operation which has been shown by the opposition. But I cannot understand why the minister would have been quoted in such a blatant way when I now find out from him that he never uttered any of these words. However, I accept his denial.
Now I come to the one question which is in the minds of many members of this committee. I am not making any appeal to the minister in this connection but I suggest to him after his effort today, one which was in keeping with the best traditions of parliamentary debate, that now he has secured the passage of this bill on second reading he ought to make that announcement which everywhere across this country people are

July 5, 1966
Canada Assistance Plan panting to hear-the announcement which is going to bring about a new heaven and a new earth to those in need who are over 70 years of age. They are waiting for this announcement. It has been built up.
The minister said he never undertook to make it. I do not challenge his view in that connection but if the ordinary interpretation is placed on what he said and on what the Prime Minister said to me the meaning is clear, that when the minister had been given the opportunity of rising and concluding the debate he would meet head on the question which had been raised regarding the old people of the nation who are in need. I suggest to him he should give second thoughts to his decision not to make an announcement.
The ordinary sense of the words used in the statement made to the house conveyed an assurance that the minister would speak, and every hour, almost on the hour, various press men announced that as soon as he had an opportunity he would speak and explain this new plan which would guarantee to everyone with an income of less than $1,260 a year, a pension of $105 a month. Surely the minister, after his excellent effort today, does not intend to wipe out the accumulated good will resulting from some well directed remarks.


Some hon. Members:: Oh, oh.


John George Diefenbaker: I must say that when he spoke I could not but agree that some of the things he said needed to be said, because certain hon. members on my left have the habit of wrapping themselves up in the garb of political purity. They indicate that only they have in their hearts the desire to help others. Well, the appropriation of such a monopoly of philanthropy is not in keeping with the facts.


Some hon. Members:: Hear, hear.


John George Diefenbaker: I remember so well in the days of B.D.-that is, Before Douglas-we used to be told in Saskatchewan: All you have to do is elect a socialist government; everyone is going to get social security and it will be paid for out of the profits of businesses to be set up. Well, they went into boots and bunk and woollens. They went into boxes.


An hon. Member:: Trucks.


John George Diefenbaker: I cannot begin to cover the entire political phantasmagoria of promises and schemes. They rolled into action. A

business would open, and it was not very long before it closed in bankruptcy.


Some hon. Members:: Oh, oh.


John George Diefenbaker: Those were the happy, utopian days of the past. I was most interested by what the minister said in this connection. Always I have to conclude that those in the older political parties can still feel that as a result of their efforts a little something has been done for those in need over the period of 100 years during which they have alternated.
I am not here to quote statistics, but if challenged I can do so. I do not feel that way this afternoon. What I am trying to do is to make an appeal to the minister to stand up now and let us know what his policy is.
[DOT] (5:50 p.m.)
He used my words on another occasion with equal success and about this he got a unanimous vote. I would have done the same. I now say to him, you know where we stand; I ask you where do you and the others stand?


Herman Maxwell Batten: Order. I should like to make a comment regarding the point of order raised by the Minister of Public Works. May I read for members of the committee standing order 78. I wish to read this now because it is one of the standing orders which has bothered me since the new orders were temporarily adopted. Standing order 78 says this:
1. In proceedings in committee of the whole house upon bills the preamble is first postponed, and if the first clause contains only a short title it is also postponed; then every other clause is considered by the committee in its proper order; the first clause (if it contains only a short title), the preamble and the title are to be last considered.
Speeches in committee of the whole house must be strictly relevant to the item or clause under consideration.
The question which arises in the mind of the Chairman is this. If clause 1 is to be postponed, does that give the committee the right to have a general debate on clause 2. Further, I might quote standing order 59(2):
Speeches in committee of the whole house must be strictly relevant to the item or clause under consideration.
There is some doubt in the mind of the Chairman whether the discussion so far is relevant to clause 2 of this bill. However, I would hope that those who are going to take further part in the discussion would confine themselves as closely as possible to clause 2.
July 5, 1966	COMMONS


Thomas Speakman Barnett: Mr. Chairman, if any remarks or exchanges which took place between the minister and myself the other evening so piqued him that he changed his mind about making the statement which was requested, I would take this opportunity of apologizing most profoundly to him because I certainly would not want any remarks of mine to delay the announcement which it has been suggested a great many of the older citizens of Canada are awaiting. If the minister is so sensitive I will offer to go out of the house right now so as not to be in his way when he does it.
We have had some discussion about the definition of a person in need. The point that has been in the minds of a good many of us and which certainly was in the minds of a great many who took part in the second reading discussion is the relevance of including and continuing to include as a person in need persons by reason of their age. As I listened to the remarks made by the minister earlier he suggested I had made an offer and had withdrawn it. I think if the minister will read what I said at that point he will find that I was in effect challenging him to make a statement which would be an improvement upon the proposal advanced by the hon. member for Winnipeg North Centre.
It does seem to me, Mr. Chairman, that the passage of clause 2 of this bill certainly could be expedited a great deal if the minister were to accede to the request made by the Leader of the Opposition and by the member for York South and clarify the confusion in our minds as a result of the statements which he and the Prime Minister have made. The minister may recall that not too long ago, in answer to a question asked by the hon. member for Winnipeg North Centre in respect of what might be done in the field of legislation to improve the financial position of the aged, he said he could not say definitely there would be a proposal brought in but he would not rule out the possibility of a proposal being brought in by the government.
This whole thing has now built up to the point where a very relevant question in relation to the definition of a person in need in clause 2 is what other plans, if any, the government has in respect of the aged. I certainly would be quite willing to yield the floor. Not only would I yield the floor but I would withdraw from the house for the time being if that would induce the minister to make the statement which has been requested by so many hon. members of the house.
DEBATES	7215
Canada Assistance Plan


Mr. Orlikow:: Mr. Chairman, I wish to rise to say something on this clause because it seems to me that not only did the minister make it clear during various stages of the debate, as has been mentioned by the hon. member for York South, that he would make a statement with regard to the needs of old age pensioners and government policy in that regard, but also on Friday, Saturday and even today there have been reports in the newspapers that as soon as the debate on second reading was finished the minister would make a statement outlining the government's proposal in respect of how the needs of the senior citizens of this country would be met.
A few minutes ago the minister said he had been prepared to make a statement last Wednesday following the invitation of the hon. member for Comox-Alberni but that the house would not let him make the statement then and he had since changed his mind. I have not been around this place as long as the minister but I have been here long enough to know that when three, four or five competent, experienced House of Commons newspapermen write the same story it is not an accident, that they did not pick the story out of thin air and that in fact the story came if not from the minister himself from the minister's executive assistant or the minister's public relations office. Such stories certainly are inspired.


An hon. Member:: Six o'clock.


David Orlikow: On the front page of the Toronto Telegram of today's date there is a story by Fraser Kelly. The headline reads: "Aged Wait As Debate Drags On." Here is what Mr. Kelly said:
Political gamesmanship at the expense of the nation's old people continues-


Herman Maxwell Batten: Order.


Mr. Byrne:: Mr. Chairman, I move that the committee rise, report progress, and request leave to sit again.
[DOT] (6:00 p.m.)


Mr. Fulion:: Mr. Chairman, I rise on a point of order. Surely the situation is that the hon. member for Winnipeg North had the floor and that the only interruption that can be permitted is the calling of private members' hour at six o'clock. In my view that does not give any other member on either side of the house the right to slip in a motion as the hon. member for Kootenay East attempted to do.

July 5, 1966
Private Bills


David Orlikow: Mr. Chairman, I call it six o'clock.


George James McIlraith: The only relevant rule is that a vote cannot be taken between six and eight o'clock.


Mr. Monieilh:: It is now after six o'clock.


George James McIlraith: A vote cannot be taken during that time but there is no question regarding-


Mr. Fulton:: Mr. Chairman, my point is that the hon. member for Winnipeg North had not yielded the floor. He did not sit down but was interrupted because it was six o'clock. That does not give another member the right to make a motion on a matter of business other than what is before the house, which, after six o'clock, was private members' business.


Herman Maxwell Batten: Order, please. It being six o'clock and in order that the house may proceed to the consideration of private members' business I do now leave the chair.



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Deputy Speaker:: Pursuant to provisional standing order 39A, it is my duty to inform the house that the questions to be raised at the time of adjournment tonight are as follows: The hon. member for Port Arthur (Mr. Andras), Natural Gas-U.S. hearing on transmission between Canadian points; the hon. member for Prince (Mr. MacDonald), Research-suggested establishment of special committee on space research.


William Arnold Peters: Mr. Speaker, I am sure many members are aware that it is my intention to carry out an extended discussion on each of the insurance bills on the order paper until a decision is taken which will result in the handling of this type of bill in another manner. There are a number of other bills on the order paper which are not contentious so far as I am concerned and it may be that other members would like to deal with them now. I refer to such bills as those dealing with churches. With the indulgence of the house I suggest that the order for calling these bills might be No. 13, No. 14, No. 16 and No. 17 as they appear on the order paper.


George James McIlraith: Perhaps the hon. member would permit me to ask a question. Will the hon. member consider adding to his suggested list No. 6 on today's order paper?


William Arnold Peters: Yes, Mr. Speaker.


Mr. Cameron (High Park):: Mr. Speaker, when you recognized the hon. member for Timiskaming I was about to ask the house for unanimous consent to the second reading of Bill No. S-13 which is No. 19 on today's list. I wanted this bill considered first today during private members' hour for several reasons. It has been the subject of debate for at least an hour on a previous occasion. When private members' hour expired then the hon. member for Timiskaming was speaking on this bill. It was my impression that he had almost concluded his remarks, but because of sloppy footwork on my part the bill was not given second reading. This company, in anticipation of the passage of this bill, has hired a staff and is ready to go into business. Any further delay seems to be somewhat unreasonable and certainly is costly. I ask the house and particularly the hon. member for Timisakming to give consent to second reading at this stage.


Thomas Speakman Barnett: Mr. Speaker, perhaps I might make a suggestion in view of the remarks of the hon. member for High Park. Can we reach an understanding that No. 19 on our list will be considered immediately following those items referred to by the hon. member for Timiskaming and the Minister of Public Works? I think there is some merit in what the hon. member for High Park said about the accidental position in which Bill S-13 finds itself on the order paper. If we can have such an agreement it may be possible for the house to consider that order today.


Alan John Patrick Cameron: I am always reasonable and willing to compromise. If we can obtain the unanimous consent of the house to consider order No. 19 today immediately after the others to which the hon. member referred I will be satisfied.


Mr. Deputy Speaker:: Order. Do I understand that the order in which these bills are to be heard is No. 13, No. 14, No. 16, No. 17, No. 6 and No. 19?


George James McIlraith: I believe the hon. member for Timiskaming indicated that the order in which these items would be considered was 13, 14, 16 ,17, 6 and 19. Is that correct?


William Arnold Peters: Yes, that is right.
July 5, 1966


Mr. Depuly Speaker:: Does the house agree that this order of business be followed?


Edmund Davie Fulton: Before you put the question, Mr. Speaker, I should like to understand the position advanced by hon. members. I was engaged in another discussion and I was not able to follow what took place. What happens to Nos. 10 and 11 for instance? Is there any understanding with regard to them?


George James McIlraith: The point was made at the beginning by a private member that many of the bills on the order paper would require a considerable amount of debate before being dealt with and that these other bills might be called, such as the ones dealing with churches, out of their priority on the order paper. It was then decided that order No. 19 would be added to the agreed list. I hope that is an accurate summary of what has taken place in the last ten minutes.


Howard Russell MacEwan: the second reading of Bill No. S-33, respecting United Baptist Woman's Missionary Union of the Maritime Provinces.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on miscellaneous private bills.
Mr. Eric Stefanson (for Mr. Smallwood) moved: second reading of the Bill No. S-18, to incorporate Canadian Board of Missions of the Church of God (General Offices; Anderson, Indiana).


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on miscellaneous private bills.
[DOT] (6:10 p.m.)
Mr. Jim McNuliy (for Mr. Harley) moved: the second reading of Bill No. S-29, to incorporate the International Society of Endocrinology.


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


Thomas Speakman Barnett: Mr. Speaker, I wonder whether the sponsor of this bill could not give us at least some brief introduction to the bill and its purposes before it is given second reading.


Some hon. Members:: Carried.
Private Bills


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


William Arnold Peters: Mr. Speaker, this will be a very interesting bill when it goes to committee because I am sure that many members of the house are not even sure what international society we are establishing or what the society is for.


An hon. Member:: Endocrinology.


William Arnold Peters: I see the name "endocrinology" and I suppose it is the medical term in connection with endocrine glands, etc. A reading of the bill shows that it is a fairly extensive measure. I presume this society will have a membership that is provincial, federal and international. The schedule of the bill indicates that a number of companies are involved. This is why I would like the hon. member to explain the bill. The schedule indicates that such places as Australia, Argentina, Belgium, Brazil, Chile, Colombia, Czechoslovakia, Denmark, Ecuador, Germany, England, Haiti, Holland and Hungary are involved. The schedule enumerates on two and a half pages societies that are already formed. The interesting thing is that the head office of the international society will be situated in Canada in the city of Montreal.
It is unfortunate that the sponsor of this bill is not here, because I presume the purposes of the bill will bring credit to Canada in that the head office of the society is being established in the city of Montreal. The society will itself determine the type of bylaws it will have in effect. It is interesting to note that, unlike some other bills with which the house deals, there is written into this bill a clause that in my opinion is very worth while and should commend itself to sponsors of other bills. A reading of the bill shows that clause 4 is concerned with the head office of the society, which it says shall be in the city of Montreal, in the province of Quebec, or at such other place in Canada as the society may determine by bylaw from time to time. Then there is this subclause added:
Notice in writing shall be given to the Secretary of State by the society of any change of location of the head office, and such notice shall be published forthwith in the Canada Gazette.
This is a very interesting provision and I believe it is something the committee should recommend for future bills, because in the choosing of a head office we have found that a number of companies have had to come before parliament and have new legislation

July 5, 1966
Private Bills
enacted to enable them to change their address. This has been achieved by means of a very cumbersome piece of machinery whereas a very simple appendage to the statement of the location of the head office, which would allow any company to change the address of the head office by applying to the Secretary of State and publishing the change forthwith in the Canada Gazette, would achieve the desired purpose in a much more simple way.
I believe this is a very worth-while provision and it should recommend itself to the members of the committee who are interested in taking out of parliament many of the bills that are nothing but a nuisance when companies have to come before us to change the number on the board of directors or make other changes. If a clause were written into the original act it would allow changes to be made in the number of directors, where the head office will be, where the annual meetings will be held and so on. This method of dealing with the problem would get rid of the difficulty that has existed in changing the name of a company. Also, there has been a major problem in respect of some companies in putting into the French language the title of the company. This has been a difficulty in the past because the titles of some companies are not easy to translate into the French language.
It is interesting to note that the International Society of Endocrinology is in French translated into La Societe Internationale d'Endocrinologie, and I suppose our French members would agree that this is a simple, straightforward translation of the English name. The way I pronounced it would not really convey that impression. The functions of the society are not clearly dealt with in the bill. The society has asked for power to develop a constitution and make bylaws, rules and regulations as long as they are not contrary to this act. I presume the bill has been carefully studied by lawyers versed in international and constitutional law who are in a position to assess whether the bylaws of this international agency would be acceptable to the many countries already involved in that they have branches of this society.
I note that some countries, including England, have two such societies. It would be helpful if the sponsor of this bill was able to indicate on second reading whether the fact that England has the Society for Endocrinology, London, and the Endocrine Section, Royal Society of Medicine, London, means

that these two societies were established separately. He could also tell us what the relationship would be between these two societies and the international society now sought to be established.
[DOT] (6:20 p.m.)
It is interesting to note that in addition to the power to draw up bylaws the society has asked for this power:
To acquire the whole or any part of the rights and propertise held by, for or on behalf of the association.
They have also asked for this right:
To purchase, take on lease or in exchange, hire and otherwise acquire by gift, legacy, devise or otherwise.
It would be interesting to note just what the power to acquire properties by "devise or otherwise" would include.


Alan John Patrick Cameron: I wonder
whether the hon. member for Timiskaming would look at clause 2 of the bill which sets forth the objectives of the society in a very clear and comprehensive manner. May I suggest to him that we now approve the bill in principle, and all the matters which he is now discussing can be dealt with in committee. He will have another opportunity to discuss this bill when it comes back to the house after study in committee.


William Arnold Peters: I appreciate advice from one so learned in the law. I have read clause 2 which includes a lot of big words that I really do not understand. I am not capable of grasping the principle of this bill from such phrases as:
To disseminate knowledge of endocrinology by co-ordinating and organizing international congresses and conferences of endocrinology, by facilitating collaboration among national endocrinological societies and qualified persons interested in endocrinology and by publication of books, reports and other papers relating thereto.
This may be very clear, Mr. Speaker, but to me it is as clear as mud, and it is for this reason that we have a sponsor who usually avails himself of the opportunity to give us an explanation of such bills. I realize this bill will be considered in committee but his discussion may raise a major point in question. Members of this house have a habit of passing legislation on matters which they do not fully understand. While my education may have been neglected, I am of the opinion there may be other hon. members, including the hon. member Who raised the question, who may not be too familiar with the meaning of phrases such as "co-ordinating and
July 5, 1968

organizing international congresses" and "facilitating collaboration".
Maybe I need a retraining course, but I think this is one of the reasons for having a discussion of these matters and this may be one of the reasons for a bill incorporating such an agency being brought up for discussion in parliament. I will be very interested to read the committee's report containing the information provided by the sponsor of the bill.


Mr.  T. S. Barnell@Comox-Alberni: Mr. Speaker, 1 am inclined to agree with the hon. member for High Park (Mr. Cameron) that most of the questions that might arise on this bill can probably be discussed in the committee. For this reason I am happy to support its passage on second reading.
However, there are a couple of questions of general interest which I hope the committee will consider. One of them is the reason for this society seeking to incorporate under Canadian law in view of its very international composition which, as the hon. member for Timiskaming pointed out, appears to be virtually world-wide.
There is another matter regarding this bill which has been dealt with at some length by the hon. member for Timiskaming. I will not pursue it further but it is one of principle which I have not noted in any other bills of this nature seeking to incorporate societies for various purposes. I refer to the provision, in a fairly usual clause, which gives the proposed body power to hold property and to engage in financial transactions. Is it to be construed as authorizing the society to issue promissory notes intended to be circulated as money by a business engaged in banking or insurance? Many of the companies coming before parliament wish to engage in the business of insurance. It is refreshing to find a company not desiring to do so.


William Arnold Peters: Maybe that is why the hon. member wants this bill passed.


Thomas Speakman Barnett: The fact that this particular provision is contained in this bill raises a rather interesting question of principle. Perhaps it is one that should be considered by the committee and one that can be more fully understood as a result of that consideration.
The question that puzzles me is the reason for placing in this bill a provision empowering the society to hold property and make ordinary financial transactions which are usual in the incorporation of such bodies. In
Private Bills
concluding my remarks may I say, Mr. Speaker, that I am quite happy to support the passage of this bill.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on miscellaneous private bills.
Mr. S. J. Enns (Porlage-Neepawa) moved: the second reading of Bill No. S-37, to incorporate Mennonite Central Committee (Canada).


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on miscellaneous private bills.
Eric Alfred Winkler: Mr. Speaker, I would appreciate it very much if the house would consider at the present time a bill standing in my name to incorporate Lutheran Church in America-Canada Section. Since we are now considering religious orders, this would be the appropriate time for the consideration of this bill.


William Arnold Peters: We have overlooked this bill; it was not intentional.


Eric Alfred Winkler: the second reading of Bill No. S-39 to incorporate Lutheran Church in America-Canada
section.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on miscellaneous private bills.
[Stage Direction]
The house in Committee on Bill No. C-lll, to incorporate the Bank of Western Canada- Mr. Richard-Mr. Rinfret in the chair.
[DOT] (6:30 p.m.)
On clause 1-Incorporation.
William Arnold Peters: Mr. Chairman, the Bank of Western Canada has been a fairly controversial bank. The bill to incorporate it has had a rough passage not only in the house but in the committee as well. If hon. members are interested in the amendments, they may look at Votes and Proceedings No. 41 for Tuesday, March 15, and they will see that there are six or seven pages of amendments to this bill. I am sure the sponsor of the bill would like to say a few words on the amendments that have been moved as well as the problem raised by the fact that some questions have

July 5, 1966
Private Bills
been asked about whether or not there are dummy directors for the company.
One of the directors is the former president of the Bank of Canada who apparently has a very small number of shares but has played a fairly large role in the development of the Bank of Western Canada. Apparently this bank is not in fact, a bank of western Canada at all. It is an additional bank which will be situated in the city of Winnipeg but the financial control will remain in the city of Toronto. There was some discussion of this situation in the committee, and whether or not members were satisfied with the explanations I am not able to say.
This was a simple bill of only three pages but now there are four pages of amendments which I believe raises a problem. I would be remiss in my duty if I did not mention these facts. In my opinion the move to establish the Bank of Western Canada and the Bank of British Columbia should have been taken into consideration after the discussion of the amendments to the Bank Act. At that time consideration could have been given whether or not this bank was going to perform the usual functions of a bank.
It is true that the banking industry in Canada is not under monopoly control, but from the point of view of the borrower and the depositor the banks in Canada are really a monopoly operated in conjunction with the state bank, the Bank of Canada. For this reason there has to be a certain amount of consideration given to any banking legislation because it is obvious that banks play an important role in our country. They are important for the loans they make and for the facilities they provide. They are important too in their relations to the Bank of Canada, which is an establishment that can be used for the good of the nation.
I am therefore very sympathetic to the idea that people in western Canada will have the opportunity of having a bank of their own. I regret the fact that it has been necessary to look at the sponsorship of this bill, and I am not referring to the parliamentary sponsorship. I refer to the provisional directors of the company. One who is not named seems to have a great deal more influence behind the scenes in connection with this bank than the person who has been named chairman of the board of directors, I presume pro tem, Mr. Coyne.
We are well aware of the fact that there are parts of western Canada that have not been served sis well as they could be by

existing banks. For this reason it was not surprising that the other chartered banks in Canada did not in any way oppose this measure. There are a limited number of chartered banks, I believe only 11, of which six provide the majority of the banking service for most Canadians. The fact that these banks did not oppose this measure indicates they were not prepared to provide the service themselves in many of the areas in which the sponsors of this bill indicated they were prepared to provide service. For this reason the Bank of Western Canada possibly will serve a useful purpose.
I am hopeful that the day will come when not only the Bank Act will be changed so there will be a better opportunity to assess the banking needs of Canada but there will also be an opportunity to see what the policies of some segments of the banking system may be. It is a fact that you can go to one bank in a community with a certain proposition, outline this proposition to the bank manager and indicate what your collateral is, and if you are turned down at that bank and walk across the street to another bank you will be turned down in exactly the same way. In my opinion there is absolutely-I underline "absolutely"-no competition whatever between banks. I suggest that the Bank of Western Canada is going to be no better and no worse than the other banks.
I believe we should not be passing this bill but that we should be introducing a national banking authority to bring all the banks under some central control. It is interesting to note that while we talk about a 6 per cent interest rate for the banks there are indications that is not always the rate. I presume this bank will adhere to the same policy the other banks have. Someone says that the law provides the banks can only charge a 6 per cent interest rate. This is not true. Every one of the banks has a different interest rate for various types of loans. They have an interest rate that includes the 6 per cent, plus insurance and a number of other charges.
I was in a bank and we were discussing the rates of interest on small loans. I mentioned the rate of one bank and the manager said: That is not the rate over there; it is so much. He pulled a form from his desk drawer and showed me the rate on small loans at the other bank. It was interesting to note that the bank interest on small loans was running anywhere from 6 per cent to 8 per cent. The manager was quite willing to show me how they arrived at these charges.
July 5, 1966

It is interesting to recall that a few years ago the Imperial Bank of Commerce appeared before the banking committee and was willing to testify it had a bank rate considerably higher than 6 per cent. The bank was willing to outline how it arrived at this rate. It was interesting also to note how the lawyers got into the question because some of the officers of the Imperial Bank of Commerce were asked how they got away with having various rates of interest. They said they had legal advice which indicated that if they followed a certain pattern they would be able to increase the bank rate for certain loans under given conditions. The other banks indicated at the time that they were not interested in pursuing this course, their legal advisers having indicated it was not legal. It is interesting to note that since that time all the banks have gone into this business so either the lawyers had a change of heart or the banks saw some reason for the change.
[DOT] (6:40 p.m.)
It seems to me we are not taking into consideration the over-all needs of the country and that there is a similarity between these banks and the insurance companies which operate in a monopoly position. It is true that not every Tom, Dick or Harry can start a bank in Canada, although I understand that when my ancestors first came to this country they could and did do so. Whether or not they went broke escapes me, but it certainly has not rubbed off on me and I have not inherited anything from them. Therefore I do not know whether it was a good thing that we allowed at that time a variety of small provincial banks in one community to be owned by one individual.
It is true that in this country the banking industry has weathered the storms which have plagued other countries. I think it is safe to say that for at least the last 20 years no one who has deposited money in a bank has found it less advantageous than depositing it under the mattress at home, and some people may consider it more advantageous and even a little safer.
However, the purpose of this bill, let us face it, is not to provide a service. If we really want to provide a service to the Canadian people we should nationalize all banks and thereby provide the same service to all the people. If such were the case people in Toronto would not find it necessary to say that no money is available for mortgages. In my area the farmers would not complain
Private Bills
about no money being available to buy extra equipment or cattle for the farm. They would not say there was tight money or loose money, and they would be able to obtain money as the Minister of Finance decided money should be made available.
At the present moment a gentleman's agreement exists. The minister says "Let us tighten up the money supply". He said that a short while ago and all the banks played the game. I wonder whether those in the Conservative party who a few years ago did not have much faith in Mr. Coyne would expect him to play the game if he were the chief director of this bank. When he was asked to play the game he might not play the game, though he might be an exception. This sort of thing may be good or it may be bad. The situation here may not be the same as with other banks to which we have granted charters, and therefore we may find we will repent that we granted this company a charter, even though I am sure there are many people in western Canada who are looking forward to having a bank on their street to provide service.
It should be quite clear to the Canadian public by now that banks are not only supplying service. A bank is not just a place to deposit money but also a place which provides wealth to those who deposit a few dollars toward its incorporation. The only consolation I have is that these banks will not get rich on the amount of money I deposit in them, whether they have branches in Ontario or elsewhere. Although there is some advantage to those who incorporate a bank, there is less advantage offered to those using the facilities of the bank.
I suggest that in passing this bill we may open a chink in the banking industry of Canada, particularly with the vindictiveness that Mr. Coyne may feel toward some governments for some time to come. If so, this will bring us much closer to the day when we reach the goal of which I am personally in favour, namely, nationalizing the banking industry of Canada and having one large bank with outlets in every town in the nation to supply credit where credit is needed and on a much more equitable base than I have found in many local offices, particularly when they have to call upon the collector for the next two years. If this is the accomplishment in years to come I will be very happy to lend my small support to the passage of this bill.

July 5, 1966
Private Bills


Thomas Speakman Barnett: Mr. Chairman, as you recall this bill has previous consideration in committee of the whole on April 26 last. It has, of course, been in the parliamentary hopper for quite some time now, along with another proposal to establish what has been referred to as a regional bank, namely, the Bank of British Columbia.
As 1 have said on other occasion when we have had these measures under discussion, I believe that, properly handled, the development of regional banks in a country as widespread as ours and with the diversity of economic interests we have in different regions in Canada, can serve a useful purpose as long as our basic system of banking as we know it now is maintained. At this moment we do not exactly know what the government may have in its mind in regard to the future of the banking system, except in a very general way. We do know that the two banks being proposed will come under the regulations and rules of the new bank Act, whatever form they may take, and in that respect at least they will be in the same category as any other bank in Canada.
As far as I am aware, the other new bank which is being proposed, the Bank of British Columbia is not being organized in the present bill along the lines which were originally proposed. The former bill would have enabled the provincial authorities in British Columbia to direct its policy in the public interest, but I understand it will be a genuinely regional bank.
So far as the Bank of Western Canada is concerned I am not quite so sure in my own mind that it will operate in accordance with the manner in which the name proposed for it would suggest. The question has been raised, and I think quite well documented, that while it is being called the Bank of Western Canada its control is not going to lie among western Canadians. In this connection I would like to refer to remarks made on April 26 by the hon. member for Nanaimo-Cowichan-The Islands as reported at page 4339 of Hansard, in which he said:
We have been told that one of the purposes of organizing this bank was to have a financial institution in western Canada, based in western Canada, owned by people in western Canada and directed by people in western Canada. But what do we find?
He then went on to deal with some of the evidence that was adduced in the committee on banking and finance which made it clear that so far as the financial control of the

equity capital of this bank was concerned this was not actually going to be the case.
[DOT] (6:50 p.m.)
The hon. member concluded his remarks at page 4339 of Hansard. I shall not read everything he said but only his words in conclusion.
Obviously this bank is not only going to be directed by three eminent financiers from Toronto but is going to be owned substantially by residents of central Canada, not of western Canada.
Then he added:
I have no objection to people of central Canada owning property such as this but I do not think they should masquerade as residents of western Canada devoted to the interests of western Canada. This is one of the things that give me some concern.
It is true, Mr. Chairman, that I share the concern expressed by the hon. member for Nanaimo-Cowichan-The Islands. I only hope that some of the attention which has been focused on the discrepancy between the name of the bill and the actual ownership may serve to put the management of this bank on the alert so that they will make a genuine attempt to prove that some of the fears expressed have been unfounded. I hope that if they are going to portray themselves as the Bank of western Canada they will in fact devote their major attention to meeting the needs of western Canada with respect to banking services to an extent that some of the other chartered banks in this country have not done. I hope that they will deliberately shape and form their policies to that end so that the people of western Canada will derive some benefit from the establishment of this bank and the policies which it will follow. The people have not always derived adequate benefits from the other chartered banks which have their headquarters in the eastern part of the country.
I am not making these remarks in any sense of trying to set one region of Canada against another but only with the idea that all regions of Canada should develop economically and so develop the strength of their industry that the strengthening of one region can serve to make Canada as a whole a stronger nation in the economic and financial field. I hope that this will turn out to be the case in respect of the Bank of Western Canada if it finally receives approval and is incorporated under the laws of this parliament.
I note that the hon. member for Timis-kaming made some references to one of the persons who is named in this bill who is
July 5, 1966

widely known in Canada in the field of banking and who has been at one time or another a person whose name has been bandied about freely in this chamber and in the other place. We all know that he is a man of experience and of strong will. We hope that in so far as he has a voice in the affairs of this bank he will do his best to see that it does in fact carry out the purposes previously stated with respect to establishing a bank under the name of "Bank of Western Canada".
With these remarks, Mr. Chairman, so far as I am concerned I am prepared to see this bill pass this stage so that it may be considered in the other stages of the parliamentary process.


[Stage Direction]
Clause agreed to.
Clauses 2 to 4 inclusive agreed to.
On clause 5-Definitions.
William Arnold Peters: Mr. Chairman, I refer to clause 5(l)(a)(i). In that clause there seems to be included the wording of the old clause. The old clause read:
All directors of the bank shall be subjects of Her Majesty ordinarily resident in Canada.
That is explicit. But in the incomprehensible amendment, if I read it correctly, something appears to have been added. The amendment says:
(i)	Her Majesty in right of Canada or in right of a province, or
(ii)	the government of a foreign state or any political subdivision thereof,
I would ask the sponsor what that means.


Mr. Richard:: It means exactly what is in the definition. The clause reads:
(a) "agent", in relation to
(i)	Her Majesty in right of Canada or in right of a province, or
(ii)	the government of a foreign state or any political subdivision thereof, means an individual or corporation empowered to perform any function or duty on behalf of Her Majesty in either such right or on behalf of the government of a foreign state or any political subdivision thereof, other than a function or duty in the administration or management of the estate or property of an individual.
This is just the ordinary definition that is found in such a statute. It is more or less standard.


William Arnold Peters: What worried me was that in the previous clause before being amended the wording was:
All directors of the bank shall be subjects of Her Majesty-
Private Bills
Is this new clause inserted to prevent a take-over of this bank by an outside bank, as was the case with the Mercantile Bank? Is this clause designed to prevent that sort of thing?


Jean-Thomas Richard: That cannot happen here.


William Arnold Peters: Why is there not a simple clause saying that the directors shall be Canadian citizens regularly resident in Canada? The clause as it is now worded says:
Her Majesty in right of Canada or in right of a province, or-
Then it says "political subdivision". I was wondering whether this had to do with the provincial danger mentioned by previous speakers. I was curious about this.


Jean-Thomas Richard: No, Mr. Chairman. That clause was considered in committee. There was very full discussion about this matter. In fact, all the questions raised here were raised in committee. The same objections were raised and this wording was adopted after discussion.


[Stage Direction]
Clause agreed to.
Clauses 6 to 12 inclusive agreed to.
Preamble agreed to.
Title agreed to.
Bill reported.
The Acting Speaker (Mr. Rinfret):: When
shall the said bill be read the third time.


An hon. Member:: By leave, now.


Jean-Thomas Richard: the third reading of the bin.
Motion agreed to and bill read the third time and passed.
[DOT] (7:00 p.m.)


Alan John Patrick Cameron: Time has been consumed-the time which elapsed when we were discussing the orders for the private members hour. I suggest a little extra time might be given for the second reading of Bill S-13 respecting the Canada Health and Accident Assurance Corporation. I ask consent for this to be done.


The Acting Speaker (Mr. Rinfret):: Is there unanimous consent to proceed with consideration of Bill No. S-13?


Some hon. Members:: Agreed.

July 5. 1966
Private Bills


[Stage Direction]
The house resumed from Tuesday, June 21, consideration of the motion of Mr. Cameron (High Park) for the second reading of Bill No. S-13, respecting Canada Health and Accident Assurance Corporation.
The Acting Speaker (Mr. Rinfret):: Is the
house ready for the question?


William Arnold Peters: I should like to say just two things. Sponsors who are willing to play games should expect to get hurt occasionally. Second, I think it would be wise for sponsors not to sponsor too many bills in their own names, or they also might find it more difficult in these circumstances.
Motion agreed to and bill read the second time.


The Acting Speaker (Mr. Rinfret):: Pursuant to standing order the said bill stands referred to the standing committee on trade, finance and economic affairs.


Alan John Patrick Cameron: Could I again seek the indulgence of this house? The hon. member for Timiskaming (Mr. Peters) talks about playing games. This particular sponsor was not playing any games. The bills I have sponsored were all sponsored for personal reasons. In this case the solicitor for the company was a student of mine and a friend of mine for many years.
However, the point I am making is that a number of bills have been sent to the committee. My bill got bypassed in that process. It is a simple bill and, as I understand it, this company is prepared, if this measure receives third reading and is passed, to commence business immediately upon Royal Assent being given.


The Acting Speaker (Mr. Rinfret):: Is that agreeable to hon. members?


An hon. Member:: No.


Alan John Patrick Cameron: It has been done in connection with other bills. However, the hon. member for Timiskaming has indicated that he, in any event, is not prepared to consent. So that will settle the matter for the time being.


The Acting Speaker (Mr. Rinfret):: The bill stands referred to the standing committee on finance, trade and economic affairs.
[The Acting Speaker (Mr. Rinfret).]
The hour appointed for the consideration of
private members business having expired, the house will resume the business which was interrupted at six o'clock.



CANADA ASSISTANCE PLAN


[Stage Direction]
The house resumed consideration in committee of Bill No. C-207 to authorize the making of contributions by Canada toward the cost of programs for the provision of assistance and welfare services to and in respect of persons in need-Mr. MacEachen-Mr. Batten in the chair.
On clause 2-Definitions.
Herman Maxwell Batten: Order. When the committee
rose at six o'clock consideration was being given to clause (2). Shall clause (2) carry?


David Orlikow: When the committee turned to other matters at six o'clock I was developing the point that the minister had made a commitment in the house to make an announcement concerning assistance to old age pensioners. The references he made on this matter in the house have been placed on record by my hon. friend from Winnipeg South.
I wish to point out that the minister went further. He and his staff were busy convincing newspapermen, the people who cover parliamentary proceedings and sit in the gallery, that he was waiting and that he would have made a statement on Wednesday, or on Thursday, or on Friday-he could scarcely contain himself, and if only the nasty people in this corner, the members of the New Democratic Party who for purely political and party reasons were carrying on a filibuster would cease their activities, he would come forward and announce his proposal.
Not only did he indicate to the press that he was ready to make a statement, but details of that statement were spilled out. I do not know whether the minister saw the press himself or whether it was his very competent executive assistant who did so, or whether it was his public relations advisor, whom I saw sitting just above the press gallery only about five minutes ago.
I wish to place on record a few of the press stories which I suggest were inspired from the minister's office. They appeared in the press across Canada, not only on Wednesday of last week, but since then. I would begin
July 5. 1966

with the Winnipeg Free Press which carried
a story on Friday, July 1, by Victor Mackie. I start with this because I notice Mr. Mackie sitting in the press gallery. It begins:
Costing the federal treasury nearly $300,000,000 a year Health Minister Allan MacEachen is expected to make an announcement soon that the federal government has decided to provide a transitional old age pension benefit. It will likely become effective Jan. 1, 1967.
Later, Mr. Mackie says:
The minister is prepared to make the announcement He wanted to make it Wednesday. But if he made the statement it could close off the filibuster the New Democratic party has launched calling for an increase in the basic old age pension from $75 up to $100 a month and the lowering of the age limit to 65 years.
Then in today's Toronto Telegram there is a similar story by Fraser Kelly under the headline: "Aged wait as debate drags on". The story begins:
Political gamesmanship at the expense of the nation's old people continues in the commons today as members enter their fifth day of debate on the Canada Assistance Plan. Several times last night opposition spokesmen refused to grant Health and Welfare Minister MacEachen the floor to make an announcement about increased pensions.
It is expected the announcement will provide for up to $30 a month assistance beyond the $75 a month now being paid.
On Saturday, July 2, Mr. Fraser Kelly had a similar article in the Telegram. This was headed: "Sham pension fight stalls government offer". I wish to read a paragraph or two from this story:
The House of Commons is locked in a sham battle as the politicians compete to win the favour of the nation's needy old age pensioners.
New Democrats won't let commons business continue until the government has promised a substantial increase to the existing $75 a month pensions.
Health Minister Allan MacEachen has such an announcement to make but he won't make it until the opposition stops calling for it because the government doesn't want to appear to be giving in to opposition pressure.
What was the announcement Mr. Kelly was talking about? The stalemate could end on Monday, the article goes on to say. Then Mr. Kelly says:
[DOT] (7:10 p.m.)
If it does, Mr. MacEachen will announce a program to provide more money for pensioners who won't receive money under the Canada Pension Plan.
The Toronto Globe and Mail of Friday, July 1, has a story by Anthony Westell. The heading of that article reads:
Ottawa plans extra aid for over-65's in need.
Canada Assistance Plan
I should like to quote briefly:
Persons too old to benefit from the Canada Pension Plan are to receive a special payment to supplement the $75-a-month old-age security pension.
The cabinet has approved in principle the idea of special assistance, though details of the scheme have not yet been worked out. The legislation is expected to be put before the Commons in the fall.
Then Mr. Westell goes on again to deal with the fact that there would be an increase of $30 a month. Who is playing politics with this question; where did these reporters get these stories which are almost word for word alike? They did not pick them out of the air; they were not smoking marijuana before they wrote these stories. They got them from the minister's office. I wish to suggest to the minister that if, as has been said on a number of occasions-


Herman Maxwell Batten: Order. I must advise the hon. member for Winnipeg North that again the Chair is having some difficulty in attempting to relate to clause 2 the statements he now is making. I would hope the hon. member would adhere as closely as possible to the clause before the committee.


David Orlikow: I think my remarks are in order, Mr. Chairman, because I am discussing the problem of the assistance which will be given to the needy. What I am trying to do is to indicate that what we propose the minister should do, and what the minister supposedly was going to announce at the end of the debate on second reading which ended today, has not been announced. I do not know whether he did not receive the approval of the cabinet in the matter, or whether he got into a huff.
I suggest to the minister that if, as so many newspapermen have said, he really is a serious contender for the leadership of the Liberal party, one way not to get support is to tell newspapermen in advance that you are going to do something and then not do it. Newspapermen, like anybody else, like to be first with what they are doing. The worst thing the minister could do for himself was to leak a story or an idea to the press and then fail to come across. That kind of thing is not going to do any good to the minister. I am not very concerned about him, but I am concerned about the tens of thousands of people who have been waiting and who had high hopes on the basis of what had been said in the house by members like the hon. member for Brantford, whose presence in the house I doubt for the rest of this debate, because I have a feeling he expected the

July S, 1966
Canada Assistance Plan minister to make a statement which the minister did not make. The people in need had been led to believe there would be an early announcement today about increased assistance, at least of $25 and probably $30 a month.
The minister said he did not intend to make this statement today and that he would make it at some future date. I think even at this late date he would be wise in the interest of himself, his party and particularly the old age pensioners, to make the statement which he obviously intends to make in the not too distant future to the effect that there will be almost immediately an increase in the old age pension.


Mrs. Maclnnis (Vancouver-Kingsway):: Mr. Chairman, when I spoke on second reading of the bill I made my position perfectly clear. I would not repeat some of my words, except that they were twisted this afternoon in the comments addressed to the members of our group. I should like to refer to what I said as reported at page 7048 of Hansard:
Mr. Speaker, if there are members in this house who would like to see this bill killed or who would oppose it, I am not one of them.
Then at page 7049 I went on to say:
I am not going to go in detail into the new services, but there are such things as child care, homemaker services, provision for nursing in the home, and other forms of health care which are badly needed and which the people in the field realize are badly needed.


Mr. Cote (Longueuil):: On a point of order, Mr. Chairman; I doubt very much if a member is allowed to repeat a speech previously given.


Stanley Howard Knowles: Provided it is relevant, it is in order.


Winona Grace MacInnis: I
thought I might be able to save time by doing this, Mr. Chairman. Am I in order?


Herman Maxwell Batten: I think the hon. member is in order in referring to remarks she made in a previous part of the debate on this same subject.


Winona Grace MacInnis: Thank you, Mr. Chairman. I will not take any length of time. I wished to make our position on this abundantly clear.
In the third place, I think this legislation will give social workers more scope in preventive and rehabilitative work than they have had heretofore. Instead of having to wait until the families and individuals are in a very bad way they will be
[Mr. Orlikow.l
able to step in at an early stage of distress and difficulty.
The social workers will have much more scope to do preventive work and also to pioneer along new lines of rehabilitation. In the fourth place, I think undoubtedly this legislation will help secure more and more highly trained social workers. This is important in an age like ours where training is very necessary. In the last place, I think it is going to be very valuable because it will include the Indians under the same provisions as other people. I think this is a very essential and long overdue form of restitution which we are making to some of the native people in this country.
I wanted to quote that, because it was said this afternoon that none of us made any reference to the good and necessary features in the bill.
Now I wish to go on to deal very briefly with one or two of the features in this bill which I think are long overdue and very necessary in this country. I know that social workers in certain parts of the country are looking to this legislation as a means of getting ahead with child care, day care, nursery care, or whatever you choose to call it. In Canada we do not know exactly what we have or how much we need in the way of day care. We do know that we need a great deal more than we have at the present time. We know that in 1965 there were 2,020,000 Canadian women working for pay outside of homes. Of these, 1,054,000 were married;
191.000	were widowed or divorced. Sixty per cent of the married, widowed or divorced women-about 757,000-had children under the age of 16.
Who takes care of these children while their mothers are at work? The women's bureau of the Department of Labour in Ottawa did some research on this in eight Canadian cities. They found that most of these women,
757.000	of them, do not pay for the care of their children. They do not pay for it because they cannot afford to pay for it. Instead their children are left with the grandmother, with another adult or, worse still, an older child.
[DOT] (7:20 p.m.)
This is the situation to date in Canada. I was interested to find out how little accurate information on the amount of day care there is available across Canada. I came across a statistical work prepared recently by the Canadian Federation of Business and Professional Women, which indicated a shocking lack of day care services in existence in Canada in relation to the need. British Columbia is one province which is a little better off in this regard than many others, yet in that province there are only 311 institutions of this kind available, including
July 5, 19BS

private nurseries, private kindergartens, kindergartens, co-operative nurseries and day care nurseries. These institutions look after in the neighbourhood of 15,720 children. In addition there are 33 foster day care homes with an enrolment of 192 children. In that province there is provision of this kind for only 15,912 children.
The business and professional women's researcher discovered that in Alberta there was concern on the part of women's groups and family welfare agencies which resulted in the licensing of day nurseries, nursery schools and play schools by the department of public welfare. All facilities in Edmonton, with two exceptions, are privately operated either through a voluntary organization or a private enterprise. The only figures available show that the total number of children provided day care in the city of Calgary is 2,085. Information available in respect of Medicine Hat indicates that some children receive this type of care, but the number is not available.
In the province of Saskatchewan-and the minister will note that that province is under new management-at the present time there is provision for 90 children. In Manitoba no figures are available as to the amount of care provided, but I have learned that there are only four licensed day care nurseries, an unknown number of private nurseries, unlicensed operators and relatives and neighbours who provide this type of service.
In New Brunswick the day care nurseries look after 703 children. When one tries to find information of this kind in respect of Nova Scotia he is reminded of the Iron Curtain, because no information is available. Even the department of public welfare is unable to provide accurate information on the number of children for which day care provision is made. No information is available in respect of Prince Edward Island, Newfoundland or Quebec.
In Ontario information is available only in regard to the city of Toronto and the city of Ottawa. In Toronto some 20,018 children are enrolled in various types of day care schools, and in the city of Ottawa 360 children are enrolled in similar schools.
Admittedly there may be a few more such day care nurseries in operation in Canada than those for which we have figures, but on the basis of our information there are only 39,088 children being looked after through this kind of service. There are approximately
757,000	working mothers; so when you consider that only 39,088 children are being
Canada Assistance Plan provided with day care, you realize how absolutely impossible the situation is and you wonder what happens to the approximately three quarters of a million children who are being left on their own, without any day care provision.
I believe that this bill will do a great deal to help make funds available for the establishment of day care schools, provided provincial governments and local welfare authorities take advantage of this provision. The next hurdle that must be overcome relates to the lack of information about day care in those provinces I mentioned. I suggest that, because no information is available in this regard, this is a clear indication that provincial governments may not use the provisions of this bill to the greatest advantage. I hope they do, because this is a very far-reaching form of service.
Another form of service which may receive assistance through this measure is the homemaker service, and here again this should be regarded as a preventive service. This type of service which will now become available in Canada I am sure will prevent many Canadian homes from being disrupted and broken. I know nothing more conducive to broken homes than mothers going out to work and leaving their small children without proper care. Homemaker service is a very valuable form of service. I do not know the exact amounts of money that will be made available for this type of service during the remainder of this year, but I hope that when the minister replies he will give us some indication.
Let me make a brief reference to another form of service, neighbourhood services. This is a new service being provided in Canada. There are four agencies at this time in Canada that provide this service and they are located, as might be expected, in the four largest cities. In Montreal there is the Association of Neighbourhood Services; in Toronto there is the Association of Neighbourhood Services; in Winnipeg there are the Neighbourhood Service Centres and in Vancouver there is the Association of Neighbourhood Services. These organizations are all affiliated with the Canadian Association of Neighbourhood Services, the Canadian Welfare Council and the National Federation of Settlements and Neighbourhood Centres.
I believe that these organizations will be eligible for funds under this program because their purposes are: first, to stimulate public interest in the role of neighbourhood services

July 5, 1966
Canada Assistance Plan within the total welfare services structure; second, to serve as spokesmen for neighbourhood services on matters of national concern; third, to serve as a medium for the exchange of information and ideas regarding local and international developments in neighbourhood services; fourth, to co-ordinate neighbourhood service projects of national scope; fifth, to foster fact-finding studies and research in neighbourhood services and provide consultative services; sixth, to establish standards of practice for neighbourhood services and seventh, to encourage the development of neighbourhood services in areas not now served.
The Company of Young Canadians expects to place some of its volunteers in positions with neighbourhood services of the nature I have described, for the purpose of assisting the people in underprivileged areas in finding a better and more adequate way of life. They will help these people extricate themselves from the vicious circle of complete dependency on welfare. Some of these people have been dependent entirely on welfare agencies for two or more generations. These programs will assist them to get out of this situation and once more get into the stream of community living. I hope they will be among the agencies which will qualify for grants under this program.
I believe that training of social workers is another area which deserves assistance. While I am referring to this aspect I should like to point out something I forgot to say when I was speaking the other day. One of the biggest arguments for a flat over-all increase in old age pensions under the old age security plan is the relative lack of highly and properly trained social workers. It is a shame to think of taking our few adequately, highly trained social workers and making them spend their time totting up people's incomes and measuring them against a needs test, when these workers are needed for other much more desirable services such as social and rehabilitative work. I think they should be devoting their time to these things, rather than fussing around about means tests, when we have a perfectly good income tax system to take back the surplus from people who do not need it.
[DOT] (7:30 p.m.)
In conclusion, Mr. Chairman, I wish to say that I believe this legislation offers real hope to welfare people across this country and to provincial welfare departments. If the provinces and the local welfare people will take advantage of it, I think it can be made to

create a real advance in our social work outlook across Canada. This is a measure that is long overdue and that will be welcomed. The fact that it does not do the big job of looking after the older citizens of this country in the way in which that job should be done does not mean that we do not recognize its value in so far as it goes. We thought we had made that clear before. If not, I hope I have made it abundantly clear that' I think this bill has good features and should be welcomed for what it is.


Stanley Howard Knowles: Mr. Chairman, I should like to ask the minister a few questions about some of the things that are defined in clause 2. The first one has to do with the needs test. Before I deal with that matter, may I just say that it will not now be necessary for me to place on the record the quotations from Hansard which I said earlier I would place on the record, because as the minister knows the hon. member for York South has done this.
I might also say that I hope that now that the minister has got what he asked for today, namely a vote on second reading of the bill on the bill itself, he will reconsider his position with respect to the making of a statement on the situation regarding old age security recipients. I suggest that he might do it when we get back to clause 1 of the bill, or if he prefers to wait until third reading he might do it then. We have had our argument. I now make the appeal to the minister to reconsider his position in the making of the statement that it was earlier his intention to make.
The heart of this legislation, having in mind the things for which it provides, is what is generally referred to as the needs test which it is proposed to establish in place of the means test in various pieces of social welfare legislation. When one looks for the definition of the needs test he has to turn, I would say, first of all to subparagraph (g) of clause 2 which reads as follows:
"person in need" means
(i) a person who, by reason of inability to obtain employment, loss of the principal family provider, illness, disability, age or other cause of any kind acceptable to the provincial authority, is found to be unable (on the basis of a test established by the provincial authority that takes into account that person's budgetary requirements and the income and resources available to him to meet such requirements) to provide adequately for himself, or for himself and his dependants or any of them.
There is more to the subparagraph, but that is the main part. The key concepts in
July 5, 1966	COMMONS
that definition are budgetary requirements, on the one hand, and resources available to the person on the other. The minister has made much of the fact that a difference between the needs test and the means test is that no monetary ceiling is established; we talk, rather, in terms of a person's budgetary requirements. If I may ask the minister to turn back to subclause (a) (i) he will see that there is another reference, which I think is relevant to my question. The reference is to "food, shelter, clothing, fuel, utilities, household supplies and personal requirements (hereinafter referred to as 'basic requirements')." These are the things that are provided for under the general heading of "Assistance." On the side of what a person needs, as opposed to the side of what he has, there are two key phrases, "budgetary requirements" and "personal requirements". There may be other phrases that are important, but certainly those two are pretty important.
It must be obvious that the way in which one's budgetary requirements and personal requirements are defined will be crucial to the administration of this act. In subparagraph (g), which I read a moment ago, it would look as though this business of defining budgetary requirements has been tossed to the provinces, because the phrase used there is, "on the basis of a test established by the provincial authority that takes into account that person's budgetary requirements", and so on. However, a little later in this bill we will come to clause 9. I think I am in order in referring to clause 9 at this moment, Mr. Chairman, because there is in it a cross-reference back to clause 2.
In clause 9 the power is given to the governor in council to make regulations for carrying out the purposes of this act. I note in particular that the governor in council will have the power to make regulations-I am now reading from clause 9 (i) (c) defining the expressions "personal requirements" as set out in clause 2 (a) (i) and "budgetary requirements" as set out in clause 2 (g). The definition of these key phrases is to be left to the governor in council. I recognize that there is provision that if there is an order in council changing the definition of any matter that is important to the act, that change cannot be made until the province concerned consents to the making of such regulation that effects a change. But unless I misunderstand this language, it seems to me quite clear that in the first place the definition of the key
DEBATES	7229
Canada Assistance Plan phrases "personal requirements" and budgetary requirements" will be made by regulation, in other words by order in council of this government.
[DOT] (7:40 p.m.)
Just in case there are any other phrases that need to be defined before this legislation comes into effect, the government has protected itself by the provision in clause 9 (1) (b) which says that by order in council they can prescribe or define anything that by section 2 or this part is to be prescribed or defined by regulation.
Earlier today the Minister of National Health and Welfare took exception to some of the language used by my colleague, the hon. member for York South when my colleague wanted the standards spelled out for us. It seems to me that this is where we can get the standards or, if I may use the expression given to us by the Minister of Finance, the guide lines. I would therefore like to ask the minister to tell us what the standards will be and what definition the government has in mind with respect to the phrases that are contained in clause 2. Surely he will admit that the whole case for a needs test being better than a means test-and both of us agree it is-will depend upon these definitions.
I am also waiting to hear from the minister in reply to the question asked by my colleague, the hon. member for Vancouver-Kingsway.


Allan Joseph MacEachen: The hon. member for Winnipeg North Centre has drawn our attention to two concepts in the bill: first, the budgetary requirements and second, the personal requirements. As I understand it, assistance means aid to persons in need of any of the following items which are contained in 2 (a) (i) which are food, shelter, clothing, fuel, utilities, household supplies and personal requirements. In a sense this provides the basic group of items that must be shared in this particular plan and under which we expect that, in agreement with the provinces, there will be an obligation, as part of the sharing arrangement, to provide these basic requirements, including personal requirements.
I will carry the explanation further by stating that the budgetary requirements are similar to the basic requirements, because presumably in the provinces that follow this budgetary approach, the budgetary requirements will include these basic requirements that are spelled out in 2 (a) (i). It is to be expected that the provincial administrations,

July 5, 1966
Canada Assistance Plan on the basis of community studies, will make a determination of what are these basic budgetary requirements to maintain the support of individuals, and that in cases where variability is necessary, such as for example, rent, this could be added to what is regarded in the social welfare field as the pre-added budget.	[DOT]
The expression "personal requirements" is used in the welfare field to include items affecting the welfare of individuals, including personal grooming, smoking, church support, and items of that kind which would be included in the basic budget.
This is my understanding of the situation. I will attempt to answer any further questions which the hon. member may wish to ask.


Stanley Howard Knowles: Since the phrase "personal requirements" will be defined by regulation of the federal government, as prescribed in clause 9, will that definition be the same all across Canada or will it vary from province to province or even within each province?
While the minister is considering a reply to this question, may I put to him another at the same time? I recognize his point that personal requirements represent one of a list of things such as food, shelter, clothing, etc. However, the phrase "budgetary requirements" as set out in clause 2 (g) is an all inclusive concept. When it comes to deciding how much assistance a person is to get, two factors are considered in their totality, as I read clause 2 (g).
There are, on the one hand, budgetary requirements, and on the other hand, the resources available to the person in need. It seems to me that in this case the definition of budgetary requirements is even more sweeping and crucial to the operation of this act than the definition of personal requirements. Here again I should like to know whether the definition of budgetary requirements, which is to be made by federal regulation, will be the same all across Canada or will it vary from province to province.
May I remind the minister that one or the difficulties that has arisen in the administration of the Old Age Assistance Act, the Blind Persons Act, and the Disabled Persons Act has been the public conflict which has ensued over the regulations. I think it is an understatement to say that the provinces intended to blame the federal government for the regulations because they were passed here, and that the federal government's reply has been that they were passed in consultation with the provinces. I should like to avoid

such a conflict in this case and I would like to know just how these regulations are to be passed. Will they apply to the whole country and on what basis will they be established?


Allan Joseph MacEachen: May I say to the hon.
member in reply to his question with respect to the regulations that will be developed, that the same set of regulations will be applied to the whole of Canada but that naturally a certain amount of flexibility will have to be applied in their administration with respect to different individuals, because surely the personal requirements of individuals may vary from one end of the country to another. I presume we would include in the regulations a flexible definition of personal requirements which would be broad enough to cover all the necessary items, but which may not be applicable to each particular province. Presumably the requirements of a person receiving assistance in a fishing village in my riding might be somewhat different from the personal requirements of a sophisticated constituent in the riding of the hon. member for York South. We want to provide some flexibility to ensure that various needs are met.
My hon. friend has asked me to draw a distinction between the concept of basic requirements and budgetary requirements, the one contained in clause 2 (a) (i) and the other in clause 2 (g) (i). The basic requirements are food, shelter, clothing, fuel, utilities, household supplies and personal requirements.
[DOT] (7:50 p.m.)
Then clause 2(a) continues by referring to prescribed items incidental to carrying on a trade or other employment; care in a home for special care; travel and transportation; funerals and burials; health care services; prescribed welfare services purchased by or at the request of a provincially approved agency; comfort allowances, and so on. The basic requirements are those basic items, and the budgetary items include this additional range.


David Lewis: If I may put it in my words, the budgetary requirements would be the budgetary total of any of the items in clause 2(a) from (i) to (viii), as applied to a particular person or a family. I understood when I read it that 2(a)(i) would apply to everybody because it refers to the basic requirements of life, and the other paragraphs in clause 2(a) might apply to some people but not to others. Some person might need care in a special home, and that would apply to him but not to a person who did not have that requirement.
July 5, 1966	COMMONS
In view of what the minister has said, I find it very difficult to understand how you can have a federal regulation defining budgetary requirements that would be applicable all over the country. As I understand it, the budgetary requirements would be the dollars and cents application to the total items under clause 2(a) which would be applicable to the particular person or family concerned. This would mean you would put a dollars sign opposite each of the applicable items. I find it difficult to understand how you can do that equally across the country, unless you have a qualitative definition rather than a quantitative one.


Allan Joseph MacEachen: It seems to me, and I am sure this is the situation, Mr. Chairman, that the budgetary requirements would be defined by regulation to include all these items in a broad way. Then, certainly, the provinces would administer these requirements with respect to the needs that were apparent in so far as the individuals were concerned. As my hon. friend pointed out, some individuals would really be affected by the basic requirements, whereas in the application to individuals in the provinces, others may or may not apply but our regulations would be broad enough to cover them all.


Philip Bernard Rynard: I should like to ask the minister a question respecting the disability clause to which he referred when introducing the bill. He said the respective regulations were being lifted. Am I to understand that a fellow who is unemployable would be regarded as disabled? Am I right in that premise? If I am, will this principle be accepted right across Canada as the definition of totally disabled?


Allan Joseph MacEachen: In the application of the Canada Assistance Plan, the important thing is that a person is in need, and the cause of the need is not really a determining factor. For example, under the disability act and regulations a person may be in need but because of his disablement he must, as my hon. friend knows, undergo definite medical tests. What we look at is the fact of need. A man could be unemployable or a man could be employed and receive assistance under the Canada Assistance Plan if in certain circumstances his income is not sufficient to cover his requirements. The cause of the need is not important in our determination, it is the fact of need. In this case, if the case load or if future applications for disability pensions were extended at a given point, that would be
DEBATES	7231
Canada Assistance Plan a matter of indifference when this program is in effect.


Philip Bernard Rynard: I should like to ask another question. Suppose the wife of this disabled man earns $2,000 a year but, as a result of his disability, he requires a lot of medication and a lot of care; does the fact his wife earns that income take away from his disability pension?


Allan Joseph MacEachen: No, if additional amounts were required to look after both of them, they would be eligible.


Philip Bernard Rynard: Yes, I understand that he would be eligible. Suppose her earnings amounted to $2,340, as they did in a case to which I was referred some time ago, would the disability pension be cut off, as it was in that case?


Allan Joseph MacEachen: This would not be the case under the Canada Assistance Plan.


Eric Alfred Winkler: Is there a ceiling on the amount of income a couple may have?


Allan Joseph MacEachen: No, no ceiling.


Winona Grace MacInnis: May
I repeat the question I asked a while ago? Has the minister a breakdown of the amount of money that the provinces are expected to require for homemaker and day care services? Is there any projection of that kind available?


Allan Joseph MacEachen: I will try, when we come to the section dealing with costs, to deal with this matter as well as I can, in view of certain limitations.


Stanley Howard Knowles: Would the minister care to relate the subclause in paragraph 2 that deals with health care services to the prospective medicare program? I ask him to believe me when I say I am not trying now to pull medicare out of him. I can do that at the proper time. Should we not know what is going to be the relationship between the Canada Assistance Plan, in so far as it provides medical care costs, and the medicare program itself?


Allan Joseph MacEachen: This was one policy decision that had to be made in order to develop a consistent relationship between the Canada Assistance Plan and the proposed medical care insurance program. In so far as the federal government is concerned, it is prepared to share in the costs of providing
7232	COMMONS DEBATES	July 5, 1966
Canada Assistance Plan medical care for needy persons in any province until such time as that province has a medical care insurance program in effect. Once it has that program in effect, then of course we will not share under the Canada Assistance Plan, and I do not see why we should. On the other hand, it was a possible position to take, that when the opportunity for medical care insurance was available under another item, we should not even agree to participate under the Canada Assistance Plan.
I took the view that the sensible thing to do was to share until the province in question has adopted a medical care program. Then, we will not share under the federal plan.


Stanley Howard Knowles: Presumably at that point the federal government will be sharing in these people's medical costs under the medical care program?


Allan Joseph MacEachen: That is the idea; my hon. friend will realize there was a decision to be made and if any province refuses, then that problem will arise.


Mr. Smith:: In clause 2(g) there is the phrase, "loss of the principal family provider". Perhaps the minister could say a word or two about the exact meaning of that phrase, because we do have situations in which the husband and wife are both employed. If the husband makes a larger salary than the wife, in the event the husband was disabled would the wife become the principal family provider? It is a curious phrase and I think we should have a better definition of those words.
[DOT] (8:00 pm.)


Allan Joseph MacEachen: I suppose that the most definite description of the situation is the death of the husband. Through this definition we apply the provisions of the Canada Assistance Plan to mothers and their dependant children. In the case, for example, of a disabled husband whose wife is the principal family provider, this would operate to assist the family, in this case on the loss of the mother.


Sydney John Smith: Assuming that neither is disabled, and at a certain point the wife is making the larger contribution to the family income, is she to be considered the principal family provider, or is it automatically the husband, regardless of income? I think I understand the intent of this clause, which is to provide for cases where one of the parents
[Mr. MacEachen.)
is missing and the husband or his widow remains. But I do not think the situation is completely clear in the instance where both have been working and then suddenly the husband becomes disabled.


Allan Joseph MacEachen: I think the use of the words "a person who, by reason of inability to obtain employment, loss of the principal family provider, illness", and so on, is an effort to illustrate the principal causes of need. But all cases of need are covered, and my view is that every case of need, regardless of the cause, will be covered. In this case it will be covered.


[Stage Direction]
Clause agreed to.
Clause 3 agreed to.
On clause 4-Agreement for sharing assistance and welfare services costs authorized.
Stanley Howard Knowles: Mr. Chairman, I do not wish to speak to clause 4, but I think there is a desire on the part' of the government to switch to another item of legislation. We would be quite willing to have clause 4 carry, but we would ask that we carry on with clause 5 at some other time. We are quite willing to switch to another piece of legislation now, if the government so wishes.


Allan Joseph MacEachen: Mr. Chairman, may I move that we rise, report progress, and ask leave to sit again later this day or at the next sitting?


Maurice Rinfret: Order. 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.



BANK ACT


Mitchell William Sharp: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to provide for the decennial revision of the Bank Act and the extension of the charters of the existing chartered banks till July 1, 1976, and to provide further for certain changes in connection with the administration of the act.
Motion agreed to and the house went into committee thereon, Mr. Rinfret in the chair.
July 5. 1966


Mitchell William Sharp: Mr. Chairman, the purpose of this resolution is to authorize the introduction of the bill to make the decennial revision of the Bank Act. A bill for this purpose was introduced on May 6 last year, was given second reading on June 14 and referred to the standing committee on finance, trade and economic affairs but did not progress further before the end of the session.
Earlier in this present session a bill was passed extending the charters of the banks until November 30 this year in order to provide time for parliament to consider this important legislation. I intend to deal at this stage only with the general approach of the government and with the major features of the proposed legislation, and to speak in more detail on second reading. Even so, Mr. Chairman, this will require my speaking for more than 20 minutes if I am to do justice to even a general explanation of the purpose of the legislation, and I hope that I shall have the indulgence of the house to go beyond 20 minutes when that point arises.


Maurice Rinfret: Is that agreed by the committee?


Some hon. Members:: Agreed.


Mitchell William Sharp: I should like to thank the committee very much for their kindness on this occasion.
Introducing the bill last year, the then minister of finance related it to the report of the Royal Commission on Banking and Finance and described the bill as a first step, but a substantial one, toward the general objectives proposed by the royal commission. The central theme of the report of the commission was that all our financial institutions, and particularly our banks, should have broader investing and borrowing powers than any of them had at the time the commission reported in order to achieve a more competitive and flexible financial system which will best serve the changing requirements of the Canadian economy.
The government decided that this central theme of the report should be taken as a long-term objective in the evolution of our financial system and noted that already progress had been made in that direction in our legislation relating to insurance, trust and loan companies. The view of the government remains that we must have a more competitive and flexible financial system which will best serve the changing requirements of the Canadian economy and the interests of all the people of Canada.
Bank Act
We are particularly concerned that the position of the smaller borrower be improved. This view is reflected in the substance of the bill that will be placed before you. Changing circumstances and further considerations have led the government to propose a number of changes in the bill that did not seem necessary or desirable a year ago. I shall mention in a moment the particular points of policy which we have changed, but first let me say something about the general background.
As part of the long-term policy to promote competition and flexibility in the financial system, it is desirable that progress be made in the legislation governing all financial institutions, both federal and provincial, and that the measures taken in regard to the various classes of institutions should be related to one another in such a way as to achieve this broad objective. Already we have done this in considerable measure in regard to our federal institutions, and I expect that we will be able to carry the process further, not only in our banking legislation and our legislation relating to trust and loan companies and insurance companies, but also in subsequent legislation regarding corporations and related matters, especially with regard to the disclosure of information.
Officials of the federal and provincial governments have recently met to discuss these and related matters. Out of this activity of both levels of government will come, I trust, a broadly integrated approach designed to improve our financial system as a whole so that it can better serve Canadian individuals and Canadian business.
I might also note that on May 27 I wrote to the provincial treasurers and ministers of finance of the provinces stating that I am prepared to convene a federal-provincial meeting on the subject of consumer credit and interest disclosure, which is so important to those Canadians who buy on the instalment plan or who borrow from finance companies. Although not all the provincial ministers have yet replied there is general support from those that have and I expect to be announcing a date for the conference some time in the near future.
[DOT] (8:10 p.m.)
The constitutional situation relating to the jurisdiction of parliament over banking was reviewed by the minister last year in speaking on the resolution, and on second reading. I shall not endeavour to review it

July 5, 1S66
Bank Act
again this year. The bill we are now proposing relates only to the Bank Act without change in the jurisdictional scope of the existing legislation. It has, of course, been preceded by a bill to amend the Bank of Canada Act and will be followed by a revision of the Quebec Savings Banks Act. The then minister indicated that the government intended to give further consideration to possible changes in the clearing system, including suggestions made by the royal commission, and would bring forward legislation on this general subject, which seems clearly to come within parliament's jurisdiction over banking. We still have this in mind for a future year.
A system of insurance covering deposits in certain financial institutions would I think contribute substantially to our general objective of greater competition and flexibility in our financial system. It should be of help to new banks in getting started and growing, and it should be of help to trust companies and loan companies in developing their deposit business within the ambit of the legislation affecting them.
Events of last summer and the anxiety to which they gave rise concerning the position of a number of financial institutions have confirmed our belief that a system of deposit insurance would reassure the public as to the safety of deposits in insured financial institutions, and would provide in addition a residual source of liquidity for these institutions in circumstances where their liquidity might be in question. Such insurance would need to be accompanied by effective inspection and adequate regulation to safeguard the position of the insured institutions.
The government intends to introduce legislation during this session to establish a crown corporation in which the banks and other federally incorporated institutions would be required to have their deposits insured. Insurance premiums would have to be paid, although we believe these could be relatively low and would reflect the fact that the overall risk involved is likely to be small. The corporation would be authorized to insure the deposits of provincially incorporated institutions where this was desired by the institution and the provincial government concerned. The government will discuss this matter with the provincial authorities.
The bill introduced last year included a number of proposals intended to further the objective of greater flexibility in the working
[Mr. Sharp.I
of our financial institutions and greater competition between them. There were for example the proposals to enable banks to make conventional mortgage loans, to exempt mortgage loans from the maximum limit on interest rates, and to reduce the minimum cash ratio required against Canadian deposit liabilities. There were also provisions, to which I attach considerable importance, to prohibit agreements between the banks on interest rates both on deposits and on loans, and to prohibit bank mergers unless approval by the government has been obtained. Similar measures are included in the bill which it is our intention to introduce at the time of the approval of this resolution. In some cases there have been changes of detail. In addition, however, the present bill contains several further changes which will enable the banks to give better service to the public in circumstances which should increase competition among banks and between banks and other financial institutions.
The first of these changes is one to which I have referred in introducing the Bank of Canada Act. It is to accept in principle the recommendation of the royal commission that the cash reserves required on notice or term deposits should be lower than that on demand deposits. This will enable the banks to compete more actively with other institutions for term deposits. The weighted average cash requirement, based on the present distribution of deposits, would be slightly less than the 7 per cent proposed as a uniform ratio in last year's bill. The bill will provide for a gradual transition to this lower cash reserve requirement.
It is also proposed to enable the banks to compete more actively with other institutions for longer term funds. Many of these other institutions borrow a substantial amount of their funds by issuing debentures, whereas banks have been restricted to accepting deposits. Many banks in the United States have been issuing debentures in recent years and there seems no reason why our banks should not be able to do so. It is proposed therefore to allow banks to issue debentures which in priority will be subordinated to deposit liabilities, limited in total amount in the case of each bank to one half of its paid up capital and rest fund. This further source of funds should benefit bank borrowers generally.
The other major change which has been made in the bill is in respect of the ceiling on interest rates. The bill introduced last year
July 5, 1966

would have continued the existing 6 per cent limit. The minister stated, and I am quoting from his speech on second reading:
If at some future time there should be a general rise in world interest rates which would make these proposals unworkable, the government would reconsider the 6 per cent limit.
In fact there has been a general and substantial rise in interest rates in the western world. In the past year the rate of discount in our treasury bills has increased by about one and one quarter per cent, the rate of interest on long term corporate bonds has increased about three quarters of one per cent, and the rate of interest on conventional mortgages has increased by the same amount or somewhat more. As hon. members of the house know, interest rates in the United States and in Europe have increased substantially.
When the bill was introduced last year, the prime rate of interest on loans made by the banks was 5J per cent. The ceiling of 6 per cent, therefore, did not directly affect the prime rate. Its main effect was to limit the ability of Canadians to obtain the more risky or more expensive kinds of loans from the banks.
Now the general increase in interest rates has brought the prime rate of interest on loans made by banks up to the maximum rate permitted by law. All flexibility is gone. No variation in interest rate is possible to take into account the credit standing of the various borrowers, or other circumstances which would normally have a bearing on the interest rate. For all borrowers in the country, other than the Government of Canada, with perhaps minor exceptions, bank credit is now the cheapest source of credit available. Bank loans are in fact being rationed. In practice, this means that larger borrowers who could and should be seeking funds in the market are obtaining funds from the banks which would otherwise be available to the small borrower.
The royal commission had some pertinent observations to make on this kind of situation. I quote a few sentences from the report:
The distorting effects of the 6 per cent ceiling have been most acute in periods of credit restraint when the banks have been prevented from raising their rates on loans and deposits in line with market forces. At such times they cannot compete equally for funds and thus have no choice but to resort to arbitrary rationing procedures in their lending. The problem is further complicated by the fact that borrowers tend to press in on the banks because their lending rates remain artificially attractive while others rise.
Bank Act
There is no doubt at all what our long-term policy should be. The government accepts the view of the royal commission-and I quote again-that-
-the ceiling stands in the way of flexible lending by the banks in that it frequently prevents them from making loans on which higher rates must be charged to cover administrative costs and risks. Obviously, this is to the banks' disadvantage; more importantly, however, it discriminates against borrowers such as small businesses which, if they are to obtain funds at all, must turn to other lenders which charge rates well above those the banks would ask if free to do so. The banks have only been able to compete in the personal instalment loan market-in which they have substantially improved the facilities and lowered the average cost of funds-because the authorities have accepted what some might argue is a breach of the spirit of the 6 per cent law. This, however, is not an argument for forcing the banks out of this business, but is instead one for amending an outdated law.
That is the end of the quotation from the royal commission.
I also draw the attention of the house to the Second Annual Review of the Economic Council of Canada, published in December, 1965. In their conclusions and recommendations relating to monetary policy, the council said:
[DOT] (8:20 p.m.)
At the same time, the instabilities which have arisen in Canada's financial markets during the past year urge a careful reconsideration of both the needs and possible methods for improving and strengthening Canada's existing framework of financial institutions. More generally, to minimize distortions and instabilities in credit and financial markets and to ensure easier access by homebuilders, consumers and small business to credit, various recommendations of the Royal Commission on Banking and Finance deserve careful attention -including measures to promote more competitive credit conditions and removal of the arbitrary 6 per cent interest rate ceiling which currently forces many small borrowers into loans at much higher rates.
That is a quotation from the second and most recent report of the Economic Council. The clear message of both the Royal Commission and the Economic Council is that Canadians should not confuse the shadow with the substance. The present bank interest ceiling which appears to some to protect the smaller borrower in fact only protects those who are fortunate enough to be able to obtain bank credit, and forces the others to seek funds from other sources at higher cost.
The house will be aware, however, that the Porter commission made its report in 1964 at a time of comparative ease in credit conditions and that even in the months since the

July 5, 1966
Bank Act
Economic Council prepared its Second Annual Review there has been a strong surge of inflationary forces which has made it necessary to permit rising demands for credit to have an impact on credit conditions.
The puzzling problem is to decide what should be done in the changed and abnormal circumstances which now prevail when general economic conditions require that the expansion of credit be restrained. Although there is an economic case for removing the ceiling, even now we think this would be unwise, if only because the transition to unrestricted competition under present abnormal conditions could be abrupt and substantial and might well cause serious apprehension.
After considerable discussion-


Some hon. Members:: Oh, oh.


William Heward Grafftey: Explain.


Some hon. Members:: Oh, oh.


Mitchell William Sharp: -after very considerable discussion, the government has reached the conclusion that the law should provide for an objective test, in accordance with which the ceiling on interest rates will be removed when credit conditions have become substantially easier and when the present abnormal conditions that involve widespread rationing do not prevail. In the meantime, however, we feel the maximum rate should be adjustable to reflect changes in the general level of interest rates, which will help to reduce some of the distortions and injustices produced by the present rigid ceiling.
The interim arrangement in the bill making the ceiling adjustable should alleviate some of the consequences of the present situation in which the banks are the cheapest source of credit for larger borrowers. Some of these larger borrowers should be induced by this change to borrow in the securities market where rates are now moderately above the present ceiling rate on bank loans and this should enable the banks to lend more to other customers. Smaller borrowers who do not have the credit standing to borrow from the banks at a 6 per cent rate should have a better opportunity to get loans from the banks, instead of having to resort to other more expensive sources of credit.
Those who put their savings into bank deposits rather than other forms should be able to get a better return-particularly on the smaller deposits which have not benefited so far from the competition which has led to

higher rates on large corporate deposits which can be handled at less cost. In general, we shall be making a start toward the more competitive system which can be brought into effect when the current abnormal credit situation relaxes.
At an earlier stage of consideration of this question, an arrangement had been suggested to me by which the ceiling on rates would be removed on larger loans but retained temporarily on smaller ones. I came to the conclusion some weeks ago, that we should offer no inducement or even excuse for banks to favour larger borrowers in the allocation of credit at this time when the total amount must be under restraint. Consequently the formula proposed in the bill treats large and small borrowers alike.


Some hon. Members:: Hear, hear.


Mitchell William Sharp: In our opinion the best available basis from which to fix the maximum rate and eventually to measure the credit conditions under which the ceiling should be removed is the average market yield on short term government bonds. While several alternatives have been considered, the formula that is being submitted is reasonably simple and responsive to underlying credit conditions. I hope that when the bill is before the standing committee on finance, trade and economic affairs, to which I intend to ask that it be referred, the formula which is proposed will be examined with care to ensure that it is the best alternative to achieve our objectives.
Naturally, no one can say just when general interest rates will decline to the point that will release the ceiling on bank interest rates. I would hope it would come sooner rather than later, so that the proper development and evolution of our financial system as a whole can proceed on the basis of effective competition. Meanwhile, the provisions relating to mortgage lending, which have been somewhat modified from those in the bill of last year, will permit a greater measure of competition forthwith in this field, and this, I am sure, will be welcomed by the public. The bill will also permit continuing competition in the field of unsecured personal loans where the competition of the banks has resulted in a reduction of the rates paid for consumer credit. The experience with these consumer loans is, I think, an indication of the beneficial influence we can expect over the longer term by competition between the banks and other institutions.
July 5, 1966

Turning now to other matters being dealt with in the present bill, I would note that the government has decided to leave unchanged the provision in the present Bank Act that new banks shall be established only by special act of parliament. In last years' bill it had been proposed that new banks be incorporated by letters patent with the House of Commons having the right to nullify such letters patent within a stated period of time. After considering all the circumstances that could be involved, it has appeared to us that this long standing authority should remain with parliament. However, if further discussion on this point should indicate a general feeling that incorporation by letters patent is preferable, the government would be prepared to consider an amendment along these lines. Under either provision we would favour the establishment of more banks as a means of increasing competition.
The clause in last year's bill which would limit the over-all size of a bank in which one shareholder has a substantial interest-that is, a minimum of a 25 per cent interest-by reference to the amount of its authorized capital, has been continued in this bill. A bank which is dominated by one large shareholder, particularly if that one is an able and aggressive foreign bank, is not in the same position as other banks whose shares are held by many investors and which naturally have to increase their capital and issue additional shares from time to time as their business expands. The government does not believe that any bank should be an exception to the general situation in this respect. This measure of control need not involve any inequity.
One other change should probably be mentioned at this time. On second reading of last year's bill, the minister indicated government willingness to consider an amendment which would permit certain agencies of provincial governments, such as pension funds, to acquire modest amounts of bank shares perhaps on a non-voting basis. It has been decided to include this change in the present bill so that certain types of government funds will be able to acquire bank shares on a non-voting basis subject to the same over-all 10 per cent limit for the funds of any one government as applies in the case of other shareholders.
Provisions in the bill of last year limited to 10 per cent the number of voting shares that a bank would be permitted to own in any other corporation and limited to one-fifth the proportion of directors of a corporation who could be directors of any one bank. These 23033-4581
Bank Act
provisions we propose to continue and in addition, after the ceiling on the loans interest rate is removed and the banks have come into more direct competition with other deposit-taking institutions, this bill would provide that a director of any such institution, sometimes referred to as a near-bank, will not be permitted to become a director of a bank.
Finally I come to a point that has been the subject of much controversy at the time of previous revisions of the Bank Act. I have reached the conclusion that the shareholders of a bank and the public are entitled to have more complete information with regard to the financial operations of our banks and, for this purpose, this bill contains provisions which will require each bank for the first time to disclose in its annual financial statements the amount of its so-called inner reserves that have been created out of taxable income and the amount of its realized profits and losses during the year on investments and loans. The question of the extent to which the banks may create reserves free of taxation I am leaving until we have had an opportunity to receive and study the report of the Carter commission.
[DOT] (8:30 p.m.)
In addition to the more important matters which have been mentioned, there will be a number of minor changes as compared with the bill which was introduced last year. The time available for discussion and comment has enabled us to propose detailed improvements of a technical nature.
I should like to re-emphasize the determination of the government that the fresh winds of competition shall permeate our system of banking and finance. We are determined that the system shall operate in the interests of the greatest number of Canadian consumers and businessmen. We are determined, in particular, that the interests of the small borrower and the small businessman shall be protected and furthered. We believe that the most effective way to achieve these ends is to encourage and to enforce competition. In this view, the government is supported by the Royal Commission on Banking and Finance and by the Economic Council of Canada. If there are many competing sources of loan funds and many institutions freely competing for the custom of the consumer, we are convinced that he cannot help but benefit.

July 5, 1966
Bank Act
May I, in conclusion, review some of the measures that we are proposing today to bring about the competitive conditions in our financial system that I have been describing.
1.	We propose that banks should not, after July 1971, be able to hold more than 10 per cent of the voting stock of any Canadian corporation, including what are popularly known as near-banks with which the chartered banks will be competing for deposits and loans.
2.	We propose a number of measures which will cut through the system of interlocking directorates. For example-
(a)	a director of one bank may not be a director of another bank
(b)	not more than one-fifth of the directors of the board of any single Canadian corporation may sit as directors of any one bank. This will produce a considerable revolution.
(c)	after the interest ceiling has been lifted, no director of any near-bank such as trust and loan companies that accept deposits from the public may become a director of a bank.
3.	Agreements among banks on interest rates on both loans and deposits will be prohibited. Mergers of banks will continue to require the approval of the government. In other words, the main underlying principles of the Combines Investigation Act will apply to banks.
4.	In order to provide maximum flexibility and to ensure that the banks can serve the smaller and riskier borrower as well as the larger and stronger, we intend that the present interest rate ceiling be eventually removed. This will occur when credit conditions have eased sufficiently to ensure that borrowers will benefit from competition. In the meantime, a ceiling realistically related to general interest rates will be maintained.
5.	We propose to require the banks to reveal to the public for the first time their inner reserves created out of taxable income.
6.	In order that the important questions affecting consumer credit may be examined in relation to all credit-granting institutions, I intend to call a federal-provincial conference in the near future to deal with this matter.
7.	We propose to strengthen substantially the competitive position of the so-called near-banks through a system of deposit insurance. This will increase their ability to attract deposits and strengthen public confidence in them.
8.	The proposed system of deposit insurance will help promote the creation of new

banks by strengthening them in the early stages of their development.
9.	We propose to allow banks to make mortgage loans. When the banks entered the personal loan field a few years ago, the interest rates paid by small borrowers were reduced. We expect the same beneficial effect from more competition in the mortgage field.
10.	We propose to establish new flexible and reduced cash reserve requirements to enable banks to compete more actively with other institutions for loans and deposits.
These changes now being proposed in the act, as well as others to which I have referred, will permit, encourage and indeed require competition. The Canadian banking system is world renowned for its financial integrity and stability. Our banks now must become more flexible in their ways of doing business and learn to compete more effectively among themselves and with other institutions. It is my intention that the prohibition of agreements on interest rates shall be enforced. I would hope and expect that there will be competition in the rates charged on loans and in the interest rates and other terms offered on deposits. I would hope that we will see more frequent changes in the rates of interest that they charge, and that they offer, in response to market changes. I do not believe that competition should merely extend to the quality of service. There seems to be more room for individual banks to differ in the nature of the services they render. For example, it is surprising that banks have experimented so little with variations of office hours.
The bill will provide a blueprint for competition. I trust that in the next decade we will witness a significant modernization of our banking system.
When the bill has received second reading, I propose that it should be referred to the standing committee on finance, trade and economic affairs for detailed study.


Jay Waldo Monteith: Mr. Chairman, may I just
ask the minister a question. I think he intimated that the ceiling on interest rates of loans would be tied to the average market yield of short term government bonds. Just what is the formula by which means they are going to be tied to the industry?


Mitchell William Sharp: Mr. Chairman, that will appear in the bill; but, as I said, there will be a percentage spread between the average rates over a period of short term government
July 5, 1966

securities. When the resolution has been approved the bill will reveal all the terms.


Edmund Davie Fulton: What will be the percentage spread?


Mitchell William Sharp: Mr. Chairman, I do not think this is an appropriate question. I have spoken in general about the type of legislation. I do not think it would be appropriate for me to go into the particular terms of each clause.


Edmund Davie Fulton: Mr. Chairman, with respect, I suggest to the minister that this is one feature of the bill which is perhaps the most difficult as well as the most important. I think it is quite unusual-and I will be restrained in my language-for the minister to skirt so carefully the most important feature of the bill without giving the house and the country some idea of what he proposes. He is asking us to approve this in principle without giving us the information. I think the house is entitled to know what is the interest spread in what the minister has in mind.


Mitchell William Sharp: There are many details of this kind scattered through the bill. I do not think it appropriate for me to give the details at this time. The details are included in the bill and we propose to bring forward the bill just as soon as the resolution is approved.


John George Diefenbaker: Mr. Chairman, the committee has listened to a recital by the minister of a variety of generalities. He has refused to give particulars. He asks the house to accept his general view as expressed in the resolution. By his attitude he has indicated that we are supposed to accept a resolution unexplained and apparently unexplainable, a proceeding as unusual as it is unjustified.
>
(8:40 p.m.)
I say at once to the minister that he has simply placed before the house a hodgepodge of uncertain plans with a few definite conclusions, unchanged from last year, and he has asked the house in faith to accept from him the assurance that if the resolution is passed there will be revealed to the house various matters which up to the present time have not been elucidated or explained in any way.
I am going to speak for a moment on the general purposes of Bank Act revisions and then deal with several of the matters to which the minister alluded. All of us are agreed that we must share in this nation in the maintenance of confidence in our financial system. A royal commission was set up by the government, of which I had the
Bank Act
honour to be the head, under Chief Justice Dana Porter. It studied the banking situation for 30 months. In May of 1965 this government, after 11 months of study, brought proposals before the house and the country with the objective of a more open and competitive banking system and another objective, to remove the restrictions which impede response to new situations and to explain the need for revision long overdue.
A commission is set up and it makes recommendations, and I am going to refer to that in general in a moment. The government found itself in a dispute between the forces of the hon. member for Davenport and the present minister. According to the press, tremendous controversies have sprung up. Unity at any price is apparently the objective. What amendments have finally been determined? Out of chaos and uncertainty the government produces formulae of compromise. I do not have to go beyond this evening's issue of the Toronto Star, which is accepted in Liberal circles as the essence of all that is good, proper and appropriate.
The heading in that newspaper tonight is "When Marchand and Sharp Both Threatened to Quit". In the last few weeks there has apparently been a tremendous division. The article written by Martin Goodman states:
The threatened resignation from the federal cabinet of immigration minister Jean Marchand was the hidden factor that caused Prime Minister Lester Pearson to order a delay in bringing forward the revised Bank Act two weeks ago . . .
And, after finance minister Mitchell Sharp forced Pearson to reverse that decision by threatening to resign himself, one of the things that soothed Marchand and kept him in the cabinet was Sharp's agreement to okay increased aid to the aged-but only in the fall.
I emphasize the word "soothed", because when one sees some of the recommendations that were made by the minister this evening it becomes obvious that there was a great deal of soothing syrup used by the minister to bring about a feeling of equanimity. The article states:
One of the things that soothed Marchand and kept him in the cabinet was Sharp's agreement to okay increased aid to the aged-but only in the fall.
What a government this is. We hoped this afternoon to hear an explanation by the Minister of National Health and Welfare as to what the plans are to end poverty. This article in the Toronto Star states:
This hidden relationship between two of the government's major decisions-the removal of the 6

July 5, 1966
Bank Act
per cent interest ceiling in the Bank Act and $30 aid to needy pensioners-has been pieced together over the last week . . .
It is a tale of two threatened resignations, of a holiday weekend spent in feverish negotiations and, at the end, of a political saw-off that saw both Sharp and health minister Allan MacEachen emerge with important cabinet victories.
What a revelation as to the way in which these people in office produce policies for Canada. The article then states:
The Bank Act legislation is ready to be presented to the Commons and, at an opportune time, MacEachen is to announce the government's intention to give more aid to the aged.
The announcements will culminate six months of political manoeuvring by Sharp and MacEachen to win cabinet approval of their goals.
That is a magnificent story and it shows how utterly hypocritical is the attitude taken by the government in connection with this matter. The article then states:
At one point, MacEachen led 26 unhappy MPs into Pearson's office to plead for more assistance.
What a government. It goes on to state:
Early in June, Sharp finally got his way with the Bank Act.
Although the majority of the cabinet had political qualms, Pearson gave his approval . . .
Overworked and under pressure, disillusioned with some of the direction the so-called reformed party was taking, Marchand regarded removal of the interest ceiling as the last straw.
We know now that the ceiling is not being removed, so apparently all of those discordant elements almost threw them, you might say, into the cave of Adullam. The Old Testament speaks of the gathering together of the afflicted, the uncertain and the fearful. These people met together in a cave of Adullam.
The article then states:
At any rate, Sharp, conscious of the need to soothe ruffled feelings within the party over the Bank Act, finally agreed to an increase.
That is a reference to the increase to pensioners of $30 a month. Mr. Goodman then writes:
Meantime Sharp, too, was caught up in the effort to persuade Marchand to stay in the cabinet.


Mitchell William Sharp: You should get better bedtime stories than that.


John George Diefenbaker: This is all a bedtime story and it has been a bedtime story all along. That is exactly what this is. The
minister says this is a bedtime story and I shall deal with that in a moment.

[DOT] (8:50 p.m.)
They met together-the most frightful commentary on a hapless government that has ever been given to the people of any country on a matter as serious as amending the Bank Act. They waited. They thought. They compromised. They brought together those on the left and those on the right. Within the cabinet there was disagreement. Outside the cabinet-and it is the only time in Canadian history that there has been a cabinet and a shadow cabinet in the same government-the shadow cabinet under the member for Davenport, with the assistance of the member for Outremont-Saint-Jean, pulled one way. Neither of these former ministers is in the chamber tonight.
Is that a way to bring about amendments to the Bank Act, for a government to play around with this problem for 11 months? They postponed the matter and this evening instead of formidable and important changes to meet the challenges of the changing economy we have a series of uncertain, unstable compromises designed to hold unity in the government among those who support it, regardless of consequences to the country.
Let us examine what the commission recommended. It recommended the abolition of the statutory 6 per cent interest ceiling on bank loans. It recommended allowing mortgage lending by banks. It recommends that all institutions doing banking business be brought under the federal Bank Act. There was no suggestion of that whatsoever in what the minister said this evening. There was a suggestion that if companies incorporated under provincial legislation, and the province which they are incorporated, decide to accept deposit insurance, it will be brought into effect.
The royal commission recommended full disclosure of interest rates on all credit. There is nothing in what the minister said to give effect to that recommendation. The Porter commission went on to say that nearbanks should be brought under the Bank Act. This could be brought about by agreement with the provinces. It recommended that there be action taken to stop concentration in the financial community. There is no awareness of the other matters that were recommended, excepting fuller financial disclosure by corporations. The commission might just as well never have sat. What has been produced is simply an arrangement whereby the highest common factor relating to changes and amendments is to be recognized. The
July 5, 1966

caucus, according to the press references, would not stand for removal of the interest ceiling. And what do we get? We get the production of a plan as outlined by the minister, and he will not even give us the full detail.


Mitchell William Sharp: Yes I will; just as soon as the resolution is passed.


John George Diefenbaker: The minister cannot get around it. He went into detail in those matters that he wanted to reveal, but when questions were asked by the hon. member for Kamloops and the hon. member for Perth the minister immediately hid himself from possible cross-examination and took the attitude, "I cannot give you this information because, after all, we are in committee." What have we got here? A government afraid to face these issues; a government afraid to take a stand on behalf of Canada, lest it risk unpopularity.


Mr. Jorgenson:: How could it be more unpopular?


John George Diefenbaker: We have had a series of reports of what has happened. I have the clippings here but I shall not dwell on them this evening. They show the changes that have taken place. During the election campaign the minister said to his friends, "The ceiling will be removed." Does he say he did not undertake to do that?


Mitchell William Sharp: Yes.


John George Diefenbaker: In January after the election the press reported that the interest ceiling would be lifted and the minister was going to take a courageous stand.


Mitchell William Sharp: The press also said you were going to resign.


Some hon. Members:: Oh, oh.


John George Diefenbaker: I must say that I want to have the full benefit of these interpolations. What was the nature of that one?


Mitchell William Sharp: I said that the press also said you were going to resign.


John George Diefenbaker: Mr. Chairman, it is well to keep silent rather than make interruptions in a voice and manner that cannot be heard. The caucus convened. In February he sent his parliamentary secretary to placate the members of caucus, according to the press. On February 1 it was reported that in the first week of January the hon. member for Davenport sent a letter to the finance minister setting
Bank Act
out his views and warning the finance minister that he might have to state them publicly. He suggested in the letter, as reported in the press, that the Minister of Finance should consult him before acting; but the minister did not do so.
It is a strange situation. Where tonight is the member for Davenport? Have the ideas he uttered a year ago, accepted by the Prime Minister and the government as orthodox finance, become unorthodox in the last year? What has brought about the change? What has happened? As one press man with the Toronto Globe and Mail who seems always to know what is going on in Liberal circles said on February 15, there really was not a revolt among the members of the Liberal party. He said there was no revolt. They could not revolt because-and the second "because" was this-the minister had not yet declared his position on the interest ceiling. He went on to express the assured hope, in consequence of discussions with an individual usually most reliable, that the minister was going to insist on the removal of the 6 per cent ceiling. He did say as did the minister this evening, that the former minister of finance, the hon. member for Davenport, had stated that if at some future time there should be a general rise in world interest rates which would make these proposals unworkable, the government would consider the 6 per cent limit. What have they done? Are they going to bring about competition, to which the minister paid lip service? Will they ensure that the near-banks and trust companies are brought under federal supervision which could be achieved by arrangement with the provinces? What has been the actual reason for the concessions and changes that have been made? There were two essential issues: first, the ceiling- now forgotten.
[DOT] (9:00 p.m.)
All through the last few months we have been following the situation. We read in the Toronto Globe and Mail of February 15 "Interest ceiling bedevils Liberals". Then, on April 15, it said: "Sharp likely to remove 6 per cent bank interest". On May 26 it said: "Liberals split over banking act changes". On May 21 Victor Mackie of the Winnipeg Free Press wrote "Bank rate to be raised". On May 27 the Toronto Star wrote "P.M. follows 'Walter Sharp' line". On June 31 it wrote "Bank act is coming and the 6 per cent ceiling on bank loans will be lifted".

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The minister produced this unsatisfactory compromise which bears no regard whatsoever to the recommendations of the Porter commission. Where is the courage about which the Prime Minister spoke on April 23, 1963? Where has it gone? It has certainly not come to rest in the soul and heart of the Minister of Finance.
Arguments have been advanced on all sides in support of the freeing of the bank rate. The public argument is that it would permit the banks to enhance their profit position; that it would compel a shift to higher rates; that it would increase the cost of doing business. On the other hand the counter-argument is advanced that if the ceiling were removed, it would actually bring about expansion and development, would be beneficial to the small borrower and would assure depositors of higher rates.
What has the government done after all these months and months of gestation? It produced after much postponement a monstrosity on the subject of interest rates. It would have taken courage to have followed the recommendations of the Porter commission, but the minister's stand in the election campaign was the 6 per cent interest rate ceiling should be removed. He told us he did not hold that view, but all I can say to him is that in the city of Toronto there are many of those in high finance who must have misunderstood what the minister had said.
Here is the finest example of this government's attitude. Its major characteristic has been to act in the wrong way at the wrong time and for the wrong reasons. They speak about weightlessness in space: We have it in the present government. What is the position of the government? I can see the Prime Minister and the Minister of Finance sitting down together and discussing the matter. They say to each other "If we remove the ceiling, what will happen to the support in our party? What of the two leaders in the shadow cabinet?" They say: "If we don't do something we will be in trouble. Isn't there some formula that we can produce that will fool everybody?" That is what they have done.
Talk about a bigamous government-a government committing political bigamy. It is married to those who want an increase in interest rates and it is betrothed to those who oppose it. It is an amazing performance, and we are asked to take seriously the recommendations of the minister in this connection.
The delay in bringing in these amendments has been harmful to Canada. It has been
[Mr. Diefenbaker.)
seriously harmful to small businessmen, who have found it impossible to get necessary funds because the banks do not know what the rate will be. The government's tactics have contributed to the tight money situation in this country, and nothing whatsoever in the amendments proposed in connection with the interest rate will do anything to help the businessmen in our nation-not a suggestion.


Mr. Basford:: What is your policy?


John George Diefenbaker: That is the finest contribution the hon. gentleman can make from a sitting position.
The minister says to us "Don't worry about this. When the bill comes in, you will understand." All I can say is that it would have taken courage for the government to have faced the issue.


An hon. Member:: Which they have not got.


John George Diefenbaker: That is not the distinctive quality of the present government. They are asking the members of the opposition to bail out the government in the division in which it finds itself-its members divided, uncertain, critical and threatening. That is indeed an unusual type of incubator for the production of legislation beneficial to the nation.
What about some of the other recommendations? I do not want to take more than a short while to deal with them. The minister laughs.


Mitchell William Sharp: I was not smiling at what you said.


John George Diefenbaker: He laughs. I want to tell you that those people to whom he has promised the removal of the ceiling would enjoy seeing him as he smiles derisively at the substitute for action that he has produced. He did not dare face reality. He admitted tonight that he started off with a plan whereby the interest ceiling would be maintained up to a certain level of loans. I believe the figure he mentioned was $25,000. That would have destroyed small businesses in every part of Canada. The banking institutions would not have made loans at the lower rate of interest, realizing that they would be getting a larger rate of interest on larger and more compact loans. When that did not work, they came up with a further alternative.
What are the other plans to alleviate the general situation? The minister did not deal with that in any detail. It has been taken for granted that the chartered banks will be allowed mortgage lending at the going rates.
July 5, 1966

But if the restrictions are similar to those that were provided in clause 77, subclause (2), paragraph (b) of last year's bill, which indicated that land itself was the only acceptable security, they would exclude many other securities that should be available.
[DOT] (9:10 p.m.)
What about the bank from New York? What is going to be done about the Mercantile Bank? I should like to have heard something about that. I know the review was as elusive as the explanation regarding interest. What changes were made in the plan that was evolved last year by the former minister of finance?


Mitchell William Sharp: No change.


John George Diefenbaker: No changes; so, the position is this: On the one hand, the minister says we are going to encourage competition and, on the other hand, he says he is going to place that bank in a position of being subject to retroactive legislation, the most dangerous kind of legislation that could possibly be brought before a House of Commons. I hold no brief for the Mercantile Bank. I was not a visitor or a guest of those connected with that bank, but it is unfair, it is unjust that a bank that came in under the law as it was should be subject to the arbitrary ipse dixit of a government.
Why were near banks not brought under control? What action was taken in this connection? Why is it that the actual rate of interest which is to be charged by the banks should not be revealed? The 6 per cent rate is regularly eluded. Indeed, most borrowers find themselves paying 8 per cent or 8J per cent, even though there is a ceiling of 6 per cent, simply by means of requiring the borrower to leave a certain percentage of his loan on deposit as well as by way of certain service payments that have to be made.
Now then, we come to the next idea. You know, Mr. Chairman, it was interesting to listen to the minister. When he was dealing with unimportant things, he spoke with power. When he dealt with the interest rate, he spoke in a rather low, uncertain voice. When he came to deal with interlocking directorates and share ownership between banks, you would have thought this was going to do something to save the nation. Will it mean that the Royal Trust and Montreal Trust will have to be separated from their banks within five years, as was provided last year? Will provision be made so that banks can split 23033-459
Bank Act
their stock and have as many vice-presidents as they wish, as was provided last year?
The minister says it means an individual cannot hold more than 10 per cent of the issued shares of one bank; that was the plan last year. Will last year's plan that no bank can issue more than 25 per cent of its shares to non-residents be maintained? The minister indicates that that term will be there. The Royal, the Imperial Bank of Commerce and the Bank of Montreal may have exceeded this term already. But these are comparatively trivial matters. The essential recommendations were, as I said a moment ago, first, the removal of the ceiling on interest; second, the bringing of near-banks under the authority of the government. Why were these things not revealed and examined?
They talk about a revision. Last year the bill ran to about 110 or 112 pages, of which no more than 12 pages represented any changes. If I may summarize, Mr. Chairman,
I say what is being done is simply a repetition of old acts. I went back through the years and read all the Hansards back to confederation on this subject. I read the Porter commission report in detail, and carefully. The changes that are being made in the revision represent less than 5 per cent. The material changes that have been made are founded on political expediency; they are pallid, timid, fearful.
I looked forward to this new, aggressive Minister of Finance, expecting changes that could not be agreed upon by his predecessor. What we have is simply a bill with a few slight changes based on expediency and compromise. The interest ceiling provision is neither fish, fowl or red herring. The section that was placed before the house by the minister shows "Sharp" manipulation rather than economic need. I should like to hear the views of the former Minister of Finance. He has dealt with these things in his book. Apparently he has converted to his philosophy many of those who sit opposite. He did not succeed in securing everything he wanted, but he did succeed, through the power of those who fell in behind him and his leadership in bringing about an unsatisfactory series of compromises. This is a bill not in keeping with present day conditions.
I say to the minister, if you had faced the issue courageously you would have commanded universal approval, even though there might have been some criticism. I say this to you that we, in Her Majesty's opposition, do not intend to play that game, the

July 5, 1966
Bank Act
game of pretence. We do not intend to bail out the government. We do not intend to be pawns to bring about unity in the Liberal party.
[DOT] (9:20 p.m.)


Colin Cameron: Mr. Chairman, to begin with I think I should say that I am not particularly interested in the details of the real or imagined or reported split and division within the government and the Liberal party. I have never been interested in the squalid details of domestic quarrels. I am concerned with what the minister told us and even more concerned with what he has not told us tonight.
In fact, Mr. Chairman, we have had a remarkable exhibition today of two cabinet ministers both performing a sort of dance of the seven veils, and refusing to take the last veil off, out of modesty one presumes. Perhaps they realize that they were intellectually related under the seventh veil. At any rate, we are not told. One can be more kind and suggest that what we have seen has been a very skilful operation of the old pea and shell game. We are asked to guess what is under the shell, which pea is under it and which shell it is under. We cannot say, of course, because we are kept in the dark.
Frankly, Mr. Chairman, I have been very disappointed in the minister's presentation. I did not expect that I would altogether agree with him but I did hope that I was going to hear a reasoned case for the adoption of a certain policy, about which I might well have had some reservation. But we did not get that tonight. We had a number of rather discursive remarks suggesting certain things might be done, but nothing definitive and positive was told us.
The question of the 6 per cent interest rate is, of course, one which has engaged the public attention, and I am surprised that the Minister of Finance was not able to marshal respectable intellectual arguments in support of the rmoval of the 6 per cent limit and to present to this house a policy of substituting some other method of control of the banking system.
Instead of that he took refuge in extraordinarily vague statements. We were told that a ceiling will be retained-a ceiling. We are not told where it is, how high up it is, or what the ceiling is. There was mention of some approximation between the permitted interest rate and the average short-term yield on government bonds. But again, no definition

and no suggestion as to who was going to impose the regulatory functions upon this particular issue.
While I have not been entirely persuaded that it is essential at this particular time to remove the 6 per cent ceiling on bank interest rates, I am quite aware, of course, of the arguments in favour of a greater degree of flexibility in interest rates by the chartered banks. But having said that, sir, I think we then have to face something else that the minister refuses to face.
In fact, his speech tonight was in main a complete denial of something that I thought he would have recognized, something which I am sure most people in Canada, and I would suggest almost the entire business community in Canada, are all too well aware of, namely that the banking system of Canada is a monopoly. It is sheer nonsense and poppycock to talk of competition in our banking system. It is a monopoly, and I am not at all sure that it is not a good thing that it is a monopoly. It is a monopoly that has been given a privileged position in our society and our economy, to the degree that no bank in Canada can possibly fail, because no government can allow any bank to fail.
Twelve years ago, at the last revision of the Bank Act, I asked the then Governor of the Bank of Canada whether, in his opinion, it was possible at that time for a bank in Canada to fail. Mr. Towers, who was the Governor at the time, with commendable banker's caution, said well, he did not want to give a categorical statement that it was impossible for a bank to fail in Canada, but he would say that it was extremely unlikely and could only take place in conditions of virtual economic collapse.
So I think we have to face this fact: We have a monopoly with ironclad guarantees of survival and protection from any disaster. Because this is the case, we then must have some method of controlling it. If the minister is not prepared to devise a more sophisticated method of controlling it than he has suggested tonight, then I would submit to you, sir, that the safety of the Canadian people impels us to insist on the maintenance of the present 6 per cent limit, clumsy, unselective and inadequate as it may be, as a means of controlling this monopoly which has a privileged position and which, in the final analysis, is and must be supported by the Canadian government and the Canadian taxpayer. As I say, I was surprised that the minister appeared to be unable to bring
July 5, 1966

forward a more sophisticated approach to this problem.
It would appear to me that having granted, as those who have studied the matter must grant, that there must be some greater flexibility in our banking system, we must then turn our attention to this problem of just how to exercise the controls that we must exercise on this monopoly. I suggest to you, Mr. Chairman, that the answer will have to be the institution of a regulatory body before which the banks will have to present a case for an increase in interest rates; that this regulatory body will have to have the power to control the whole range of interest rates to prevent the banking monopoly from demonstrating its monopolistic character in the most disastrous way by discriminating between various classifications of borrowers.
I cannot understand why the minister continues to talk nonsense, using such lovely phrases as "the fresh winds of competition blowing through our banking system". Is the minister going to blow those fresh winds himself? Is this the case of the wolf in the child's tale-that "he huffed and he puffed till he blew the house down"? I am afraid that the minister will huff and puff but will never succeed in blowing any fresh winds of competition into an industry which, by its very nature, is a monopoly.
The minister talks nonsense about how he will have the banks brought up for examination under the Combines Investigation Act. If the minister does not know that that is nonsense, then he has no business to be Minister of Finance. If he does know, then he has no business to have made this ridiculous suggestion to us.
What is he going to do in this regard? Is he boing to call the president of the Royal Bank of Canada and the president of the Bank of Nova Scotia into his office and say: "Look, boys, I have discovered that each of you has made loans at 6J per cent. Obviously this is a combine. You must have different interest rates, otherwise I will charge you under the Combines Investigation Act"? What utter nonsense. Why produce these ridiculous straw men, suggesting that you can do something with a monolithic-and it is-and monopolistic institution?
I am not holding back against the idea of the banking system in Canada being an integrated system, virtually a monopoly in the performance of its functions, because it must be stable. There must be some uniformity. To suggest that we are going to gain anything by 23033-4591
Bank Act
pretending that we can bring the banks under the Combines Investigation Act is not worthy of the Minister of Finance of this country; it is sheer nonsense and an insult to our intelligence.
I would very much urge on the Minister of Finance, Mr. Chairman, that before he brings this bill before the house, or, having brought it before the house, before he appears before the committee on finance, trade and economic affairs in support of it, he seriously consider devising a much more sophisticated manner of ensuring flexibility in our major lending institutions and protection for the borrowers of money under the Canadian banking system. That this could be done I have not the slightest doubt. A regulatory body that could perform these functions could be easily devised, and it would not be without precedent in our history.
We have been faced with this sort of thing before, and on every occasion when we were faced with an industry that was in a monopolistic or semi-monopolistic situation, the operations of which were of great concern to the whole economy, we have established regulatory bodies. We have established such things as the Board of Transport Commissioners and the National Energy Board. These bodies were meant to deal with exactly the same powers and privileges that are enjoyed by the banking system, though not quite so wide; therefore there is even more necessity for such a provision under the Bank Act.
[DOT] (9:30 p.m.)
The minister also tells us that he is going to protect us from the evils of competition by making it illegal for the director of one bank to be the director of another bank, or to be the director of a near-bank. In July of 1971-and I do not know why July, 1971 should be the date chosen-banks can hold only 10 per cent of any other corporation's stock.
I wonder whether the Minister of Finance is so naive as never to have heard of a breed of animals that used to be known in Great Britain as guinea pigs? They sit on the boards of directors of large corporations, not knowing anything about them. Very often they are impoverished nobility in need of extra income. They sit on boards representing certain interests in the operation of that corporation, and they of course give the whole thing an air of respectability. Their chief function is to sit there on behalf of interests that do not want to come into the open. Can you imagine for a moment that

July 5, 1966
Bank Act
you are going to be able to root out every guinea pig that takes a position on a board of directors in defiance of this ruling by the Minister of Finance? If certain interests want those guinea pigs on boards, they will have them.
The minister tells us that he thinks more banks will permit more competition. I suppose "permit" is the right word. He did not tell us why he thought that more banks would ensure more competition, because I suppose he felt that was too much even for the House of Commons to swallow. We are all aware of what has happened to the banking system in Canada, and it is very difficult to persuade us that by establishing a number of banks you thereby establish competition. You may be able to develop a more effective system, providing a wider range of services, but as to competition, no; there can be and will be no competition. When the minister continually insists that it is going to be possible to permit competition, I think he is insulting our intelligence. Instead of doing that, instead of wasting his time, he should have been devoting his intellect to really dealing with the problems of banks in the modern world. If he is not prepared to do that, I want to say this, that we must retain the 6 per cent clumsy club of control that we now have over the banks.
If he does not provide a workable, sophisticated method of control, and one that does not give relief to the banks in order that they make more money, it will not be only the opposition in this chamber that he will have at his throat, it will be the people who write letters to me and, I imagine, to all members of this house on this question of the removal of the 6 per cent. The people writing will be business people and individuals viewing with great alarm and despair the thought that the banks are going to be set free to take an even greater tribute from our economy than they are taking at the present time.
Indeed, there was one phrase the minister used that rather disturbed me. I shall have to see Hansard tomorrow to find out exactly the text, but the minister spoke about carrying out his plans without changing the scope of the Bank Act.
The Porter Commission-and I have been waiting for an opportunity to say this for some time-made a very unsatisfactory report. It was one of the most poorly compiled technical reports I have ever seen. It was a mess. It left a great many loose threads dangling in the air. But it said that the

near-banks should be brought under the Bank Act. It did not say how that was to be done. It made one suggestion: that there should be a definition of banking that would bring the near-banks under the Bank Act. I think that might be possible. However, I should first want to refer to a constitutional lawyer to find out whether we can remove from provincial control an operation that is licensed by the provincial government, merely by defining that operation in this parliament. I do not know whether it is possible. Certainly, you will not be able to bring these concerns under banking legislation, in order to control them, until something like that is done.
I think we must be careful not to take any action that will encourage the growth of these so-called near-banks in our banking functions. Despite all the faults of our banks, despite their greed, if you like, and their ruthlessness, the minister is quite right; the banks and banking system of Canada are extremely efficient, and we should not encourage less efficient institutions to carry on functions that should be carried on by the chartered banks of Canada. Unless we are prepared to bring the near-banks under control, I do not know how we shall prevent their unrestricted operation. Apparently they will be enticed to come under federal control to some extent by the offer of taking part in the insured deposit system, which is to be carried out by a crown corporation, about which we heard very little.
I feel, Mr. Chairman, that as the minister has seen fit to withhold his confidence from us, not telling us anything about what this legislation is going to be, but merely offering disturbing hints in much the same way as the Minister of National Health and Welfare did this afternoon, and because it is extremely important for members of this house to discuss the possible consequences of the legislation that is still locked in the minister's mind that we have been abused. I think it was an abuse of the rights of members of this house for a minister of the crown to come before us with a resolution leading to a most important piece of legislation-one of the most important that will come before us for many years to come-and to take the position that he has the right to wrap the whole thing in mystery until tomorrow morning. We shall come across this bill in our mail boxes-


An hon. Member:: Not tomorrow.
July 5, 1966

Bank Act


Mr. Cameron (Nanaimo-Cowichan-The Is- He asked, what is to be the fate of the lands):: We probably will not get it tomor- Mercantile Bank of Canada. As you may row morning, but we shall eventually get it. recall, sir, I asked the minister a question We are asked to buy a pig in a poke. We about this some weeks ago. There have been are asked to agree to this resolution being stories in the papers that the minister had passed, when the minister will not treat us yielded to pressures and had changed the with proper decency and respect, and when policy that was introduced by his predecessor he will not tell us what to expect in the bill. with regard to containing the expansion of
this bank, which is now owned by the First


An hon. Member:: It is a hoax in a poke.	National City Bank of New York.


Colin Cameron: Yes, it is suggested that it is a hoax in a poke. I do not know whether it is a hoax. It may be that the minister has a very good plan. But why did he not tell us? Why did he not say what he proposed to do? Why did he not tell us, if he is going to maintain a ceiling, what that ceiling is going to be and how it will be determined? Where does that ceiling apply, and is there going to be the same ceiling for each type of borrower, or will there be graduated ceilings? He does not tell us these things at all.
I think it is sad that apparently no one in the Liberal caucus or the Liberal cabinet had sufficient knowledge or sufficient intelligence to overcome what my right hon. friend the Leader of the Opposition has described tonight as the shattering divisions within the party and within the cabinet, as they should have been overcome. The minister should have adopted a more intelligent and a more sophisticated approach, and one which would have presented to his colleagues a means of procedure which would have appealed to the economists of this country as a sensible procedure, and while which would not on the one hand have fallen into the error of assuming that by removing the 6 per cent limit we are saving the people of Canada from some frightful disaster or on the other hand, suggested that in order to bring more flexibility into the banking system we must let the banks run loose, at their own discretion.
A case could have been made for a logical and intelligent revision of the existing structure of the banking system that would have appealed to all intelligent members of the Liberal caucus. I say sincerely, and this is the sad part of it, that the majority of the Liberal caucus members are intelligent. I think it is a disgrace that they have not been given by the Minister of Finance the opportunity to endorse a rational, sophisticated plan for the banking system of Canada in the future.
The right hon. Leader of the Opposition mentioned toward the end of his speech a matter which I think deserves a word or two.
[DOT] (9:40 p.m.)
At that time the minister was indignant that I should even suggest he would yield to pressure, so one presumes he intends to retain the rights of control defended by his predecessor. I put it to hon. members that here is another place where the Minister of Finance might have taken a more courageous and intelligent stand. It is perfectly obvious that no matter what we do about the Mercantile Bank of Canada, so long as it remains in the hands of its present owners it will be a burr under the saddle of this government. I would suggest to the minister that he should consider killing two birds with one stone-removing this source of future trouble for himself, because it is obviously going to be troublesome; they will be up here bugging him every week-by taking this bank under public ownership as a means of ensuring that it will remain under Canadian ownership and, second, as a yardstick by which to measure the operations of other sections of the banking community and, in the third place, as a means of establishing some proper scale of behaviour and discovering something which may not be known even to the minister-the real, inner workings of the banking system of Canada.
In making this suggestion I do not pretend to be doing anything very revolutionary, because two of our sister countries in the Commonwealth, Australia and New Zealand, have for many years-


Maurice Rinfret: Order. I regret to interrupt the hon. member but the time allotted for his speech has expired.


Some hon. Members:: Carry on.


Maurice Rinfret: I regret but there is not unanimous consent for the hon. member to continue his speech.


Colin Cameron: Who said no?


J.-H.-Théogène Ricard: You have just said it.

July 5, 1966
Bank Act


Colin Cameron: Oh, yes; we have said it now. I should like to know. I don't think anybody did.


Mr. Gauthier:: Mr. Chairman, I should have liked the previous speaker to be allowed to complete his remarks, because they were very interesting. But since a single dissenting voice is enough to prevent someone from speaking, it seems that such a voice was heard this evening to prevent him from completing his remarks.
I cannot allow this resolution to be passed without saying a few words on behalf of the Ralliement Creditiste, even though this resolution took us somewhat by surprise, this evening. Frankly, we were expecting that the bill regarding the Canada Assistance Plan could Anally be passed this evening, but since the minister has decided otherwise and the house had to revert to the resolution concerning the Bank Act revision, I had to let go our expert on banking, because he had to attend a public lecture tonight. That is why we have been somewhat off our guard.
Mr. Chairman, the resolution under consideration, which is not very lengthy, reads as follows:
That it is expedient to introduce a measure to provide for the decennial revision of the Quebec Savings Banks Act and the extension of the powers of the existing savings banks till July 1, 1976, and to provide further for certain changes in connection with the administration of the Act.
As you can see, Mr. Chairman, the resolution is quite limited and, above all, it is being introduced very late. We are wondering why the government, after 110 days of session, introduces the most important piece of legislation of the session at this time.
It is introduced just before the end of the session. That is the most surprising thing. During the Arst 50 days of the session, bickering went on about everything and anything, discussions on all kinds of nonsense such as the Spencer affair and the Munsinger affair. Important questions were completely overlooked. Tonight, one of the last nights of the session, the resolution is brought in. I say, Mr. Chairman, that this government is operating contrary to all good sense. I am asking that the government program be prepared so that the main legislation is brought down at the beginning of a session, so that we may consider it for as long as necessary. I have the impression that the measure or the ensuing bill will be sent to the appropriate committee and may be considered during recess. That is
IMr. Ricard.]
why, Mr. Chairman, I was saying at the outset of my remarks that this resolution comes too late to be seriously considered. It should not be forgotten that this Bank Act is important.
It is not the Arst time it is brought before us. The Arst time, an extension was granted; the second time, a so-called amendment was introduced bringing down the reserves to 7 per cent. Now, as far as I can make out from the parables of the minister-tonight, he spoke in parables more than in anything else -it seemed to me that he was again trying to reduce the bank reserves. Before the last reduction, with $8 deposit in the Bank of Canada, banks could lend $100. Now with $7 deposit, they may lend $100. Possibly, under this bill, it will be enough to have $6 deposited in the Bank of Canada to lend $100. And if the interest is increased to 7 per cent, that will be quite an interest for an investment of $6 or $7.
There is some worry over the banks, Mr. Chairman, I have never been worried over banks. Let me have the powers the banks have and I shall be making money. I will not go bankrupt.
In his statement, the minister told us that the purpose of the bill was primarily to promote competition. To my mind, that is the main purpose of the bill: Competition between banks. When I consider the greatest monopoly in Canada which is that of the banks, I wonder where the competition can be? Whether the interest ceiling is set at 6 per cent, or at 6i per cent or at 6f per cent, you can be sure-the decision is made in advance-that if one bank lends at 6 per cent, all the banks will be lending at 6 per cent. How can you expect them to compete?
[DOT] (9:50 p.m.)
Let us suppose, for instance, in the commercial Aeld, that 100 or 150 stores constitute an absolute monopoly, such as the banks, and they determine that the price of a pair of shoes shall be $7 and that no store shall have the right to sell them neither for less nor for more. Do you believe there would be competition between those stores? No, Mr. Chairman, no competition would be possible. It would be an absolute monopoly and competition is not a feature of monopolies.
I would have thought that the minister would have wanted to talk about competition from the service standpoint-which would have made some kind of sense-and that each bank would have sought to give the
July 5. 1966


Herman Maxwell Batten: Order, please. 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, as the case may be?


Some hon. Members:: Carry on.


Paul Theodore Hellyer: Mr. Chairman, I heard several members suggest that we carry on. If it is the wish of the committee that we carry on that will be agreeable.


Michael Starr: Mr. Chairman, I think the comment was made for the purpose of allowing the hon. member who was speaking to use the full 20 minutes allotted to him.


Paul Theodore Hellyer: We are agreeable to that suggestion.

July 5, 1966
Bank Act


Stanley Howard Knowles: If that is all that is being asked we are agreeable, but perhaps in fairness we should also allow the hon. member for Medicine Hat to make his speech and then call it a day.


Paul Theodore Hellyer: Agreed.


Herman Maxwell Batten: Is that agreeable?


Some hon. Members:: Agreed.


Charles-Arthur Gauthier: Thank you, Mr. Chairman. I am nearly through. I also noticed that in his statement the minister warned us that in the future, in the studies made concerning banking reforms, provincial governments and companies will be able to acquire bank shares subject to a 10 per cent limit, but unfortunately, he added: not voting shares.
Mr. Chairman, I think this will be a matter of discussion during consideration of this bill and we intend to put our opinions forward in that connection. As we will base ourselves on the Royal Commission on Banking during these discussions on banking reform, I hope the minister will allow for once the Bank of Canada to take its true place in our financing system.
The analysis of our financial system has shown that the Bank of Canada plays second fiddle; I therefore submit that, during the future studies, the Bank of Canada recapture its natural part, the leading outstanding part it should play in our financial system, in short that it be called upon to finance all public sectors, in order to leave to chartered banks the financing of private sectors.
Thus we will no longer see chartered banks lack credit every season. When everyone is in his place and does his part, we will say that the Bank of Canada is the national bank; it must finance national affairs, national departments and not look after private affairs. I believe, Mr. Chairman, that as soon as we begin to study this bill, we will be able to shed some more light on the banking system, so as to inform everyone.


Mr. Olson:: Mr. Chairman, first of all I should like to thank the members of the committee for their indulgence in sitting past our regular adjournment hour so that I could make a few comments respecting the statement made by the Minister of Finance when he introduced this resolution. I would say at the outset that while we can agree with many of the objectives stated by the Minister of

Finance when he introduced the resolution, it seems to me that there is not very much in the remarks he made that would appear to give effect to those objectives.
For example, the minister talks about this new Bank Act being a blueprint for competition. From the information that we have thus far respecting the amendments which will be in the new Bank Act when we receive it after first reading, there does not appear to me to be very much that will assure any greater competition in the field of banking, particularly in so far as the chartered banks of Canada are concerned.
I want to state very briefly that we certainly hope that the changes that will be in the bill when we see it are not changes or amendments or compromises, or whatever you wish to call them, that have come about because of divisions within the Liberal party. The amendments to the Bank Act are so important that this should not be a matter of compromise between any ministers of the crown in trying to bring in changes that are of benefit to Canada and Canadians generally.
I want also to say that I hope there is no substantive foundation to the press report that the right hon. Leader of the Opposition read from the Toronto Star, to the effect that these compromises came about as a result of sharp divisions of opinion between the Minister of Finance and the minister of manpower, because I believe that the old age pension, the Old Age Security Act and even the Canada Assistance Plan are far too important to have amendments based on some compromise that can be reached respecting the Bank Act.
We in this party agree that there ought to be more competition in the banking field. There is no question about that. But it seems to me we have not as yet heard from the Minister of Finance how he intends to achieve this end. Yet there has certainly been plenty of time because, for example, there were the 10 years that expired in 1964 when the Bank Act should have been revised. In addition to that, the Minister of Finance and his colleagues have had the benefit of not only the Royal Commission on Banking and Finance, that took some 30 months looking into this matter, but they also have the reports of two years from the Economic Council of Canada in which comments were made about banks and banking in this country. In addition, we are now two years overdue in coming to grips with the changes that
July 5, 1966

72S1
are needed in the Bank Act. Therefore I do not think the minister can plead that he has not had sufficient time to come forth with the kind of amendments that will make the banks and banking in Canada more effective and in keeping with modern requirements.
I was interested in the minister's comment that all financial institutions will be brought under the umbrella of the Bank Act and that to achieve this end he has issued an invitation to the provincial governments to come to a federal-provincial conference, in an attempt to work out some kind of agreement and arrangements as to how this will be done.
[DOT] (10:10 p.m.)
I agree with the hon. member for Nanai-mo-Cowichan-The Islands when he suggested there might be some constitutional conflict in simply naming these other types of institutions that are close to banks, and thereby in fact requiring them to comply with the federal legislation. I am convinced that to bring a provincially organized institution within the terms of the federal act will be far more complex than that. However, Mr. Chairman, I suppose we will hear something more about this. I hope the Minister of Finance is prepared to tell this house what he intends to ask the provincial ministers of finance to do to bring these other institutions in line with a uniform banking policy.
The minister has also spoken about a crown corporation which would in fact provide insurance covering deposits, not only in banks but in some of these near banks. He suggested it would encourage people to place deposits in the banks. This may be true for some of the so-called near-banks, but all it will do with regard to chartered banks that are concerned will be to increase the cost of depositing.
I am therefore not impressed with the suggestion that the existing chartered banks in particular should require any kind of insurance for depositors. What is more, Mr. Chairman, I do not believe there is any satisfactory argument for insurance coverage jf deposits even in the new banks which may be formed in the immediate future because, as the hon. member for Nanaimo-Cowichan-The Islands suggested, when banks in this country receive a federal charter they are required to put forth such a substantial foundation that if they are to operate within the ambit of the existing Bank Act there is small likelihood of any insurance being required for those deposits. The only time it
Bank Act
would be necessary would be in case of a complete economic collapse of this country, and we certainly hope that this will never come to pass.
We also agree that chartered banks should be allowed a wider scope in the loans that they can make, such as mortgage loans and others. We were somewhat disappointed that the minister did not spell out some new conditions in this Bank Act which will legalize what we have considered to be a breach of the Bank Act in the statutory 6 per cent limit which has been set up to this time. I am speaking of small personal loans in particular. I am convinced it costs more to service this kind of loan and I am therefore prepared to consider, and perhaps to approve, some amendments to the Bank Act which would allow the banks to charge a slightly higher fee for such loans. I believe that some of those details should be spelled out in the act because at the present time the provisions of the act are being violated by the charging of a higher effective rate than that allowed by the statutory limit, and other ways, such as the date of discount and the date of repayment, and other similar practices. I do not believe that this is the proper way of increasing the limit even for those loans which in fact carry a higher service cost. I hope therefore that in the course of our debate on this bill we will evolve a provision spelling out these new conditions.
I agree, Mr. Chairman, that the banks should be allowed to raise funds in some way other than by deposits. As the minister suggested, they should be allowed to issue debentures. This is in keeping with the practices of some of the near-banks and I find it to be satisfactory. However, in so far as these small loans are concerned, I am not prepared to agree that the great growth of the nearbanks and other public financial institutions has been wholly due to the legislation, even as it is contained in the present Bank Act.
I believe that several years ago the chartered banks of this country failed to provide the kind of service that Canadians needed and wanted. Therefore, almost as a result of the default of the banks, these other types of institution have flourished in the personal loan field and small business loans. I think that perhaps in the last two or three years, or even a little longer than that, the banks finally woke up and realized there was a large, new market that they had missed which resulted in the growth of these other financial institutions. I believe we need to

July 5, 1966
Bank Act
recognize that the banks failed to provide the service that was desired.
The minister suggested that in so far as the statutory limit is concerned, it could not be changed suddenly. He did not say very much else about it except there would be some interim arrangement pending the complete release of the statutory limit. This interim arrangement will be tied to the effective rate on short term government bonds and will be set at some undisclosed percentage above that rate. I feel the minister should have and could have given this information to the house, because if you look over all the changes that have been suggested, this is the most important one with which he dealt. Surely the house ought to have heard what kind of formula is suggested, or at least what the percentage of spread was going to be over this so-called effective interest rate.
There are many other things that we want to discuss, such as this requirement concerning directorship and the percentage of stock that any individual may hold. However, there will be plenty of time to do that on second reading of the bill. I want to say again that while the minister calls this a blueprint for competition and he talks about the fresh winds of competition that will permeate the banking system, there is very little in what the minister said that will give effect to this statement. He did not say whether or not the prohibition against agreements so far as interest charges by the banks are concerned was going to be enforced by the Combines Investigation Act, or under some similar arrangement. If the minister means what he says, and he is going to give effect to it, then we will have to have some additional laws with some teeth in them. Otherwise, his suggestion that there will be competition between chartered banks is, in my opinion, simply so many words.
There has been no effective competition in the banking industry in the immediate past. There may have been a measure of competition between the managers of local branches, but so far as conditions generally are concerned, there has been no competition in the banking system. We do not see anything in the minister's statement that would indicate conditions are going to be any better. We would be interested in knowing, as quickly as possible, under what conditions the minister is going to release the statutory limit on interest altogether. He said this could not be done now because of current conditions in the financial market. We would like to know

when we can expect this information to be released. I hope the minister will come back to parliament for additional amendments before it is, in fact, released.
[DOT] (10:20 p.m.)
I will not keep the committee longer because, as I said, I appreciate the indulgence shown me in permitting me to go beyond the regular adjournment hour. As I said when I began my remarks, we agree with many of the objectives of the minister, particularly the state objective that there needs to be more competition in the banking field. But up until now the explanation given by the Minister of Finance has failed to spell out how that competition is to be made effective.


Maurice Rinfret: Shall the resolution carry?


Mr. Churchill:: Ten o'clock.


Maurice Rinfret: It being after ten o'clock, shall I rise, report progress, and request leave to sit again at the next sitting of the house?


Some hon. Members:: Agreed.
Progress reported.



BUSINESS OF THE HOUSE

Paul Theodore Hellyer: Mr. Speaker, before the questions commence I might give the order of business for tomorrow, which is, first, the continuation of the banking resolution, then the resolution on the Quebec Savings Banks Act, then the Canada Assistance Plan, and then any other business on the order paper.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Mr. R. K. Andras (Port Arthur):: Mr. Speaker, some ten years ago a proposal to build a natural gas pipe line from western to eastern Canada was the subject of considerable bitter debate in this house with far-reaching consequences. Nevertheless, the pipe line was approved and its subsequent operation has been a great success, so much so that just eight years later the capacity of the original line requires immediate expansion.
July 5. 1966

During the debate over this matter in 1956 Hansard indicates accord on one major related point, and that is the routing of the pipe line. Speaker after speaker from different parties stated his conviction that this should be all-Canadian. As a result, the line was built from Alberta through Saskatchewan, Manitoba, northern Ontario and thence to Toronto. It is claimed that the highest cost portion of that route was in northern Ontario, and this was known to be likely before construction began. But the decision of that day was to bear this additional capital cost, so as to keep this vital energy resource on Canadian soil and under Canadian control. And, Mr. Speaker, I say that this was a wise choice.
This year we face a similar decision. Trans-Canada Pipe Lines has applied for approval to build a second line, this time through the northern states. From the exit at Emerson, Manitoba, to the re-entrance at Sarnia, this facility would be on United States soil, subject forever to the control of the United States. Today it appears possible that all the sound arguments presented for an all-Canadian route may be in danger of being forgotten.
The public hearings before the National Energy Board of Trans-Canada's application were completed in March. We do not yet know what the decision might be, and quite properly the members of the National Energy Board will not indicate their reaction until their ruling is announced. I have confidence in the vast knowledge often displayed by the chairman and members of that board, but I rise tonight to bring this matter to the attention of the final Canadian authority, parliament itself, because I feel that it is a much too important decision to be made without discussion in this house. We are facing a major choice of principle in dealing with this application to place forever on foreign soil and under foreign control a major Canadian resource asset.
We are asked to accept this proposal, when there is an acceptable alternative course open to us which would retain this program as an all Canadian facility. Such an alternative does exist in looping and adapting the existing northern Ontario pipe line to provide the necessary increase in capacity. As a northwestern Ontario member I have a parochial viewpoint of course. We are conscious of the economic impact in our area of the capital expenditure of some $240 million to $260 million in northern Ontario if the existing line is looped.

Proceedings on Adjournment Motion
Already our industries are using more than twice as much gas as was originally estimated. Several industries and communities in northwestern Ontario are not yet serviced by natural gas. A number are not assured of an adequate supply from the present line for immediate needs, let alone future expansions and new industrial growth.
So I will not deny a local bias. But I am also vitally concerned about the danger to the national interest, if the U.S. location is approved.
Beyond identifiable and concrete economic factors identified in light of present laws and attitudes of the United States, we feel concern about future change in those attitudes and regulations. Such changes might be difficult to foresee now, but in any number of ways, and at any time, they could present a threat to the transmission system and the Canadian public interest-if the line is built in the United States. The Canadian route would eliminate that worry and danger, which must be considered as an intangible but significant factor.
When I appeared before the National Energy Board in March I supported the intervention of the Fort William/Port Arthur and District Council to the Trans-Canada application. Among other comments, I specifically requested that, before a decision is rendered, there be made, published and publicly discussed, an independent cost analysis and comparison of the total economic effect of both routes. No reply or indication of reaction to my request has been given by the board. This, partly, gives rise to my concern and to my action in bringing this before parliament tonight.
We are told by Trans-Canada that the difference in capital cost between looping the existing northern Ontario system and building a new line through the United States could amount to over $30 million in favour of the United States route. Even if this were so, we say there is great wisdom in keeping th s all Canadian for the reasons I have already outlined.
In addition I should like to draw attention to these other disadvantages of the United States route: First, the amount of United States dollars that are going to have to be invested initially by Trans-Canada; second, the continuing drain of United States dollars required to be paid by Trans-Canada to Great Lakes Transmission, Trans-Canada's United States partner, which would own the United States pipe line in question. So, for
7254	COMMONS DEBATES	July 5, 1966
Proceedings on Adjournment Motion these and many more reasons, we should not depart from the principle established ten years ago. But, in final argument, I want to introduce an important new fact that to the best of my knowledge was not presented during the National Energy Board hearings. Throughout Trans-Canada has claimed that by taking the United States route as opposed to the looping of the northern system, natural gas would be delivered at a lower price to the consumer in eastern Canada.
Today, I am in possession of a brief that purports to refute that claim. This was prepared by the Panhandle Eastern Pipe Line Company of New York and the Trunkline Gas Company of Houston, Texas-both United States corporations. It was tabled with the Federal Power Commission, in opposition to Trans Canada's application to that United States regulatory body, and is a matter of record there.
It was developed by experienced specialists in the field of pipe fine engineering and cost accounting, using the detailed engineering and cost data supplied by Trans-Canada to the National Energy Board. Because it obtained that information from presentations to the Energy Board in March-


The Acting Speaker (Mr. Rinfret):: Order, please. I must advise the hon. member that the time allotted for his speech has expired.
Mr. Jack Davis (Parliamentary Secretary to
Minister of Mines and Technical Surveys): Mr. Speaker, all other things being equal, I
am sure that all members of this house and most Canadians would prefer an all-Canadian route for a natural gas pipe line bringing gas from western Canada to central Canada. I say, all things being equal, that is so. One of the fundamental considerations would, of course, be that the route followed would deliver gas at the lowest possible price. It is conceivable that an all-Canadian route would do this. However, there have been submissions to the contrary.
[DOT] (10:30 p.m.)
The National Energy Board was set up in the late fifties to assess these projects in the Canadian interest and to take into account various technical aspects of the submissions made by the pipe line companies, by the producers and by the consuming utilities, most of them, in this case, being in eastern Canada. Trans-Canada has applied for permission to run, not north of the lakes but via an international route. The hon. member for Port Arthur (Mr. Andras) has said new evidence has recently been made available in

the case of an application by Trans-Canada now before the United States power commission. This takes the form of a submission to the effect that Trans-Canada's costs, were it to follow an all-Canadian route, would be lower than Trans-Canada has contended they would be.
The National Energy Board is fully staffed with accountants and other experts. It makes continuing studies of the costs of all Canadians as well as international routes. I am confident that the information tabled by the Panhandle Pipe Line Company is available to the National Energy Board and that the board is able to take critical note of that statement.
The National Energy Board will make a recommendation to the governor in council who can, of course, take into account any other information or policy consideration it deems fit. Normally, the governor in council will accept the recommendation of the National Energy Board. But I wish to assure the hon. member for Port Arthur that not only is the energy board capable of doing a first class job in this connection, but that the government itself will take a hard look at the recommendation of the National Energy Board with a view to protecting interests in northern Ontario and elsewhere which require natural gas in large quantities at the lowest possible price.



RESEARCH-SUGGESTED ESTABLISHMENT OF SPECIAL COMMITTEE ON SPACE RESEARCH

Mr. David MacDonald (Prince):: I should like to direct the attention of the house to the substance of a question I raised on July 4 as will be found reported at page 7,128 of Hansard with reference to a policy on space research for this country and the present position of space research.
I suppose each generation has before it a special challenge which stands out from the others as being of special importance, possibly as expressing the spirit of the age itself. When we think of the 'sixties our attention will undoubtedly be turned to the whole question of space. Outer space is the frontier of this half of the twentieth century. Many of us have spent hours viewing with fascination some of the great adventures which have taken place in space brought to us by means of television. Unfortunately, even though Canada has in the past few years begun to work in the area of space research, public
July 5, 1966	COMMONS
opinion generally has been uninformed and it has certainly not been clear to myself, and, perhaps to other hon. members, that we have had a clearly defined policy in this regard.
Perhaps our policy can best be described as reflecting the attitude: Ignore it, and perhaps it will go away. Unfortunately, our space program, if it can be called that in terms of being in harmony with interests of the Canadian people, does not possess the spirit, the purpose, the direction or the policy we might like to see. Space research has been divided among many departments and organizations. The National Research Council and the Defence Research Board are two groups which have taken some part in it. There have been a number of university projects, the high altitude research project at McGill among them. We even And in a place like Churchill a space research project which is Canadian. At least, Canada pays the bill, though the people employed are for the most part Americans.
Frankly I am at a loss to know-after all we have not been in the space business very long-why we have not had more parliamentary interest and a definite outline of our policy with regard to space research. More recently we have instituted a Science Council; but space research is more than science. It involves communications, transportation, defence, and ramifications involving industry. It even has a cultural effect. This is such a large and important question not only to the world at large but even to this country that we must not wait too long before we institute a parliamentary committee to examine this in detail. We are losing many well-trained people. I am told that only one person in ten who applies to work in space research in this country finds employment. We need to encourage our scientists; we need to develop a thorough-going policy in space research. In the United States for some time now there has been a full fledged congressional committee devoted primarily to space research. In the United Kingdom they had a minister who was responsible for this same area of space research.
I think it is time to see what is going on, and not just at the level of the civil service. I know we have in the civil service a number of people who are very competent in this field. I think it is time the representatives of the people had an opportunity to sit down and ask what are the facts, what are the capabilities of our country in the field of space research, and what are the kind of
DEBATES	7255
Proceedings on Adjournment Motion things we might be doing. We might complement the facilities developed in the United States. Money is not the main obstacle in terms of space research. It is ideas, far-sighted and well designed policy. I would hope the government would see it in their power when we come back after the recess this fall, if there is going to be a recess, to have appointed immediately a special parliamentary committee which will do more than examine the many possibilities which are before us.
Let me quote in conclusion three or four suggestions made by an outspoken man, a space engineer, Dr. Gerald V. Bull:
An arctic radio television satellite system that would provide reliable reception in the far north.
How important this would be in respect of northern communications.
A navigation satellite that could determine precisely the geography and mineralogy of the country.
That would be quite an improvement. There are a number of other suggestions all of which could be within the competence and financial resources of this country. I am most anxious to hear the views of the Minister of Industry (Mr. Drury) in this regard because I feel we can look forward to great and enlightened things from him. I would hope that we can begin to look for an exciting and important policy in space research for this country.


Hon. C. M. Drury (Minister of Industry):: Mr. Speaker, I commend the hon. member for his interest in and enthusiasm for space research, which he has described as a new frontier. While there would be those who would argue that Canada still has frontiers of a terrestrial character, I do think there is effort to spare and that certainly the time has come for us to look beyond the terrestrial limits. There is no doubt that in North America, and this is going over into Canada, there is a great interest in space research.
The hon. member has suggested the formation of a parliamentary committee to seek the answers to a number of questions concerning what we are doing, what we can do, what possibilities are open to us and how we can fit in with the programs of other nations, and perhaps make use of our talents. I should like to say that in my view, before this kind of program can be effectively tackled by a parliamentary committee, it is necessary to assemble the facts and to get some valid scientific views, particularly on future possibilities.
July 5. 1966

Proceedings on Adjournment Motion [DOT] (10:40 p.m.)
To this end the science secretariat of the Privy Council office early this spring commissioned a full scale study and review of what is being done in respect of space research in Canada, not only by the various government departments but also by universities, and an assessment of future areas in which we might be more active than we have been in the past. There is no question but that space research is a costly operation. With the limited resources of a country such as Canada we cannot attempt a complete space program on our own. We must do it in co-operation with others, and in those specialized fields to which our particular talents lend themselves.

It is my hope that this study will be presented to the Science Council not later than December of this year. When we are in the position to get the views of the Science Council, whose object the house will recall is precisely to lay out general guide lines for scientific research activities for the whole of Canada in the future, and when we have had the benefit of a review and an assessment exposed to the Science Council, I think it would be extremely useful for a parliamentary committee to look at the situation and give the necessary enthusiasm and impetus to this whole field.
Motion agreed to and the house adjourned at 10.45 p.m.

Wednesday, July 6, 1966