1966-06-13

[Stage Direction]
First report of standing committee on fisheries-Mr. Deachman.
[Englishi


Hon. Mitchell Sharp (Minister of Finance):: I wish to confirm the statement issued in London today indicating that the Bank of Canada in conjunction with the central banks of ten other countries and the Bank for International Settlements is co-operating in the establishment of a system of currency swap facilities with the Bank of England. The object of these facilities is to relieve pressure on the official reserves of the United Kingdom that may arise from fluctuations in the sterling balances of overseas countries. The participation of the Bank of Canada has been fully discussed with the government.
In the interests of the most effective operation of the measures it is not proposed to go into any detail beyond that released by the Bank of England. The new arrangement will come into effect on June 15, when the facilities made available last September expire.



TABLING OF VOLUME 1 OF TARIFF BOARD REPORT ON CHEMICALS

Mitchell William Sharp: I am tabling today copies in English and in French of volume 1 of the Tariff Board's report on reference 120, chemicals. I am tabling also a transcript of the evidence presented at the public hearings of the board.
The report came from the Queen's Printer only this morning. I know there is widespread interest in its contents, and for this reason I have tabled it without delay. It had been hoped to have the report available for sale at the government book shops outside of Ottawa on the date of tabling. However, because of the time factor, this has not proven possible.
This review of the chemical industry is the most extensive study which has ever been undertaken by the board. Recognizing the importance of this report for the Kennedy round of tariff negotiations in Geneva, the board has departed from its usual custom of submitting at one time a complete report. Volume 1 of the report contains only the schedule of tariff items recommended by the Tariff Board, a short prefatory note and certain statistical information. The summary and conclusions, notes on existing and recommended items and general information on the industry will be sent to me in subsequent volumes which I will make public as quickly as possible.
[DOT] (2:40 p.m.)
I have not yet had an opportunity to study the recommendations in the board's report. I can, however, assure hon. members that the government will give full consideration to these recommendations.
In this connection I would urge interested parties who may wish to comment on this report to do so promptly. Representations should initially be made in writing and addressed to the director, tariffs division, Department of Finance, Ottawa. A technical group of tariff specialists will be set up shortly to hear oral representations.



LABOUR RELATIONS


Hon. J. R. Nicholson (Minister of Labour):: I wish to report to the house on developments over the week end in connection with the longshoremen's strike.
A small committee of the cabinet met with the bargaining committees of the I.L.A. and the shipping federation here in Ottawa in continuous session all day Saturday and Sunday morning. In these intensive mediation efforts, my colleagues and I were assisted by Judge Rene Lippe and senior officials of the Department of Labour.
While these sessions did not result in agreement on all the issues in dispute, substantial progress-what I would describe as real progress-was made in further reducing the matters in dispute, so much so that the

June 13, 1966
Labour Relations
I.L.A. union in Trois-Rivieres this morning wired me its acceptance of the final proposals, subject only to clarification of some points with the employers.
The desire for an early settlement of this dispute, which was clearly in evidence over the week end, was further emphasized by a request from the I.L.A. to the Prime Minister this morning for a further meeting, conveyed by the president of the Canadian Labour Congress. Arrangements have been made to bring small ad hoc committees of both parties to Ottawa, distinct from the larger ones we have had here over the week end, for further meetings this afternoon. The urgent request received by the Prime Minister from the
I.L.A. for the meeting this afternoon is, to my mind, most encouraging.


Right Hon. J. G. Diefenbaker (Leader of the Opposition):: For several weeks, from day to day, the government has been making hopeful announcements as to the way it is proceeding to bring about an end to this strike. Almost daily we have had promises from the minister, and this is another. I think many people now realize as never before that this government is inadequate, inept, indecisive-


Mr. MacEachen:: And in office.


Some hon. Members:: Oh, oh.


John George Diefenbaker: There are no other adjectives I can use to describe it. It has been a showcase of complete dilatoriness on a matter affecting all Canada; and they laugh and sneer. They find it funny. In every part of this nation people should know their reactions. Today we are treated to another of these explanations and postponements. While this has been going on, trade is diminishing. Warnings have been given by the wheat board as to the potential loss which may be suffered. Goods are piling up, and the government says "Wait for a longer while."
One has only to look at the picture in the Gazette this morning to realize that it was not a very happy conclusion. Never before have there been three standing together looking so disheartened and dismayed. The only one who really stood out was the Minister of Transport. That face of his could not have done any harm. Indeed, he stood out as the one who at least had not lost hope. The other two were disheartened, dishevelled and disappointed. Why wasn't the minister of manpower there? He is the only one who knows

anything about labour problems. I say to the Prime Minister with great respect-


Mr. Pearson:: Sure; I know with great respect.


John George Diefenbaker: -that while these people met together and talked, he travelled. Important as are outside responsibilities, there was no reason why, on an occasion such as this he, the Prime Minister, having regard to Canada's serious economic crisis, should not have been here to do his part. This afternoon the paper reports that he is now going to step in. Why did he not do so during the weeks and weeks that have passed?
The explanation given by the minister is inadequate and meaningless. We have had it over and over again. Last Thursday the Prime Minister expressed the hope that a settlement was anticipated. It is no wonder that the press of the nation has been so critical, and, epitomizing that criticism, this morning's Gazette says "Pitiful Inaction in Ottawa." There is no better description of a government that does not know what to do and is doing its best to prove that it does not. The delay has gone on, and on, and on.
As I said a moment ago, the explanation that is given is entirely inadequate. When the opportunity comes I intend to move the adjournment of the house so we can get to the facts once and for all. On June 1 the hon. member for Burnaby-Coquitlam asked for leave to move the adjournment of the house. We had a discussion that afternoon. Read it in Hansard. There was the same repetitive explanation by the government. While Canada suffers, her international image is being defaced by the failure of the government to act. All we get is another postponement; wait until this afternoon, or tomorrow, or next week, or some time in the hope that ultimately something may be done.
Parliament should be acting on this. Parliament is ready to act on this. All it requires is a government; but up to the present time the government has shown itself to be a rock of jelly on this problem.


Some hon. Members:: Hear, hear.


Mr. T. C. Douglas (Burnaby-Coquiflam):: Mr. Speaker, the members of this party welcome the encouraging statement which has been given to the house by the Minister of Labour, and we are glad the negotiations are being resumed this afternoon at four o'clock. We certainly hope those negotiations will result in a settlement of the longshoremen's
June 13, 1966

strike in Montreal, Trois-Rivieres and Quebec city.
We have hoped all along that a settlement could be reached by the process of collective bargaining. Members of this party are adamantly opposed to compulsory arbitration. However, at the same time we recognize that this strike cannot continue without serious repercussions not only for the economy in general but also for the two parties engaged in the dispute.
[DOT] (2:50 p.m.)
That is why we have suggested some parliamentary intervention which would not result in the imposition of compulsory arbitration, but which would put the workers back on the job with the adoption of those wage increases that have generally been agreed upon, leaving the important point of dispute, namely the reduction in size of work gangs, for continued negotiation with the help of a commissioner of inquiry.
If there is some hope of an immediate settlement then certainly my colleague the hon. member for Skeena will be prepared to allow his bill to stand. I hope that by tomorrow the minister will be able to inform the house and the country that the strike is at an end and that traffic will once more be resumed. I urge upon the minister and the government, however, that if there cannot be a settlement within the next 24 or 48 hours they will not allow the Shipping Federation of Canada to attempt to starve its workers into submission by accepting a 15 per cent reduction in their manpower, which will mean the throwing of older men on the job out on the scrap heap. The federation should not be allowed to do that.
If no settlement is reached within the next 24 or 48 hours I hope the government will give serious consideration to introducing some legislation, not to provide for compulsory arbitration but legislation which will settle the strike on the points which have now been agreed upon, leaving the balance for continued negotiation under the process of free collective bargaining.


Mr. Gilles Gregoire (Lapointe):: Mr. Speaker, we are pleased to learn that the minister is hoping the strike will be settled this afternoon, because the longshoremen's strike in Montreal, Trois-Rivieres and Quebec harbours has lasted long enough.
When a group from the committee on finance, trade and economic affairs visited
Labour Relations
Expo on May 31 last, we were told then that if the strike went on great damage would be caused to Expo. That was on May 31 last; it is now June 13 and the strike has not yet been settled.
We find those hopeful and optimistic statements most encouraging, but we have been hearing them for too long and we feel they should be followed by the settlement of the strike.
We are told that a committee made up of a number of ministers was instituted to help solve the strike. Well, there is one minister, namely the minister of manpower (Mr. Marchand), who is a man with experience in industrial relations and who had occasions to settle strikes. In view of the fact that the problem is important, I wonder if he could not make a special effort, a heroic effort to settle that strike. When there was a strike the minister of manpower always said: It must be settled. Now that he is a member of the cabinet, he should do his share to settle that conflict which affects the country's economy and, in particular, the economy of the province of Quebec.
Mr. Speaker, we are hearing very optimistic statements but we believe that the government should be realistic and do something to settle that conflict as soon as possible.
If the strike is not over within 24 hours, then the government should take the necessary action to put an end to it as quickly as possible.
Therefore, we hope that the negotiations going on this afternoon will be fruitful, otherwise we will ask the government to take immediately the steps needed to settle the strike within 24 hours at the most.
[English!


Mr. R. N. Thompson (Red Deer):: Mr. Speaker, while we in our party have been very critical of the lack of initiative on the part of the government in dealing with this strike more effectively and at an earlier stage, we recognize that if there is any possibility of reaching a satisfactory negotiated agreement that possibility must be explored to the limit. We are therefore encouraged at least by the fact that negotiations are continuing, and we hope that perhaps this afternoon some kind of a mutually satisfactory agreement can be reached, satisfactory not only to the employees but to the shipping federation itself.
It is most important that some kind of an agreement be reached which will correct as soon as possible a situation which is doing

June 13, 1966
Questions
irreparable damage to the economy. Perhaps we will never know just how much damage has been done or how many sales have been lost. But as long as there is hope of negotiation I would urge the government to do everything possible to carry it through; and I suggest that even the right hon. Prime Minister has a personal role in this matter today to try and bring this dispute to some kind of settlement.
We recognize that it cannot continue much longer. If it cannot come to agreement within, say the next 24 hours there will be no alternative but to bring in compulsory arbitration that will put the men back to work. If it is possible to reach a settlement without compulsory arbitration, so much the better; but if that cannot be done there is no alternative but to bring in compulsory arbitration that will correct this problem. Because as all of us in this house and everyone across the country know-even the unions themselves-it cannot continue as it is now.



SHIPPING

[Stage Direction]
On the order:
Introduction of bills: Mr. Howard-Bill intituled "An act to provide for the resumption of the loading and unloading of vessels at the ports of Montreal, Trois-Rivieres and Quebec".
Mr. Frank Howard (Skeena):: Mr. Speaker, in the light of the discussion and information this afternoon, I wonder whether this bill might be permitted to stand.


Mr. Speaker:: Stand.



QUESTIONS

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

Mr. Winkler: 1.	What charge or charges did the Department of Justice lay or consider laying against Gilbert M. Young, Montreal (the case of Canadian Ingersoll-Rand Company, Limited, v. Gilbert M. Young)?
2.	If charges were not proceeded with, were the terms of the statute of limitations the reason therefor?


Hon. Lucien Cardin (Minister of Justice):: 1.	No charges were preferred.
2.	It is not considered to be in the public interest to disclose publicly information relating to cases wherein charges are not preferred.
(Mr. Thompson.]


LINDLOFF FISH HATCHERY EXPANSION, N.S.
Mr. Maclnnis (Cape: Breton South):
In 1965, did the Minister of Fisheries or any other minister of the government make a statement with respect to an expansion at the Lindloff fish hatchery in Richmond county, Nova Scotia, during the spring and summer of 1966 and, if so (a) where was such statement made and by which minister and under what authority (b) what was the approximate cost of the expansion (c) has work commenced on this project, and, if not, when will it begin?


Hon. Judy V. LaMarsh (Secretary of State):: The Minister of Fisheries in October, 1965, indicated the department's intention to proceed with a program of updating the fish culture station at Lindloff, Nova Scotia, and in so doing would take advantage of improved techniques in this field; (a) the minister advised his colleague the Minister of Labour of the proposal; (b) the estimated cost of renovation and expansion is $300,000; (c) the project will be undertaken as soon as possible after funds become available.


OLD AGE SECURITY FUND
Mr. Winkler: 1.	What was the balance on account in the federal old age security fund for the fiscal year ended March 31, 1966?
2.	What is the anticipated balance for the fiscal year ending March 31, 1967?


Mitchell William Sharp: 1.	$216,982,834.44 subject to minor accounting adjustment.
2.	$455,000,000.


ROAD CONSTRUCTION, MANICOUAGAN- GAGNON, QUE.
Mr. Blouin: By virtue of the program of access roads to mineral resources in the northeastern part of the province of Quebec, did the federal government pay part of the cost of construction of a road going from Manicouagan to Gagnon, Quebec begun in 1963 and 1964 and, if so, how much was spent by the federal government in accordance with the agreement with the province of Quebec and how far has the building of this road progressed?


Julia Verlyn (Judy) LaMarsh: I am informed by the Department of Forestry as follows;
1.	Under the federal-provincial forestry agreement, during the fiscal years 1963-64 and 1965-66 the federal government paid part of the cost of construction of a forest access road from Manicouagan to Gagnon.
2.	$473,793.95.
June 13, 1966

3.	56.5 miles of right of way cleared, 55.2 miles graded, 12.5 miles gravelled, six bridges constructed, 220 culverts installed.


POST OFFICE CONSTRUCTION
Mr. Southam: 1.	How many new post offices, including crown buildings or federal buildings used to house postal facilities, will be built in Canada in this fiscal year?
2.	What are the totals for each province slated for construction in this fiscal year?
3.	Where are the locations of these post offices?
Hon. G. J. Mcllrailh (Minister of Public
Works): 1. 173.
2.	Newfoundland, 23; Prince Edward Island, 5; Nova Scotia, 21; New Brunswick, 13; Quebec, 65; Ontario, 30; Manitoba, 1; Saskatchewan, 5; Alberta, 1; British Columbia, 8; Yukon and Northwest Territories, 1.
3.	Newfoundland: Arnold's Cove, Badger, Bay Roberts, Belleoram, Cartwright (Lab.), Catalina, Cow Head, Daniel's Harbour, Englee, Fox Harbour, Glovertown South, Heart's Content, Holyrood, Kelligrews, La Scie, Lower Island Cove, Newstead, Port de Grave, Pouch Cove, St. Albans, St. Brendan's, Shearstown, Springdale.
Prince Edward Island: Breadalbane, Elms-dale, Kinkora, Little York, St. Peter's Bay.
Nova Scotia: Amherst, Annapolis Royal, Aylesford, Bear River, Berwick, Bickerton, Centreville Kings, Chezzetcook, Christmas Island, Cleveland, Grand Etang, Hubbards, Lower Wood Harbour, Maccan, Malagash, Port Hawkesbury, Riverport, Sheet Harbour, Shubenacadie, Tusket, Waverley.
New Brunswick: Aroostook Junction, Bayfield, Black's Harbour, Cocagne, Debec, Elgin, Harcourt, Hartland, Lameque, Ludlow, Renous, Sheila, St. Isidore.
Quebec: Angers, Anse St. Anne des Monts, Bedford, Biencourt, Bolduc, Caplan, Carleton, Cross Point, Deschaillons, Hauterive, Havre Aubert, Joly, Lac des Aigles, Lac Ste. Marie, L'Anse St. Jean, La Patrie, Laprairie, Les Eboulements, Loretteville, Montreal (P.S. "S"), Mont Tremblant, New Carlisle, New Richmond, New Richmond Station, Notre Dame du Lac, Parisville, Paspebiac, Pierre-ville, Pointe Gatineau, Repentigny, Ripon, Riviere a Pierre, St. Alexis de Matapedia, St. Kamouraska, Ste. Anne des Monts, St. Ap-Anaclet, St. Andre Avelin, St. Andre de polinaire, St. Bruno, St. Camille de Belle-chasse, St. Cesaire, St. Charles de Bellechasse, St. Damase, St. Epiphane, Ste. Etienne de
Questions
Gres, Ste. Flore, St. Guillaume d'Upton, St. Honore de Temiscouata, St. Hubert Temis-couata, St. Isidore de Dorchester, St. Isidore de Laprairie, St. Jean Baptiste de Rouville, St. Jean Port Joli, St. Lambert, St. Mathieu, St. Octave, St. Omer, Ste. Philomene, Ste. Rose du Degele, St. Ursule, Sayabec, Terrebonne, Val Morin, Val St. Michel, Victoria-ville.
Ontario: Almonte, Aurora, Belmont, Blyth, Bruce Mines, Coboconk, Coldwater, Cooks-ville, Don Mills, Eganville, Emsdale, Erin, Hornepayne, Iroquois, Iroquois Falls, Lavigne, L'Orignal, Meaford, Moosonee, Newburg, Nipigon, Omemee, Ottawa (Postal Terminal), Port Credit, Port Hope, Prescott, Ripley, St. Eugene, Streetsville, Sutton West.
Manitoba: Durban.
Saskatchewan: Esterhazy, Estevan, Maidstone, Tamkins, Simpson.
Alberta: Edmonton.
British Columbia: Burns Lake, Fort Nelson, Fort St. John, Golden, Kelowna, Tofino, Vancouver, Vancouver West.
Yukon and Northwest Territories:	Hay
River.


POST OFFICE BUILDING, IONA, N.S.
Mr. Muir (Cape Breton: North and Victoria):
Is reconsideration being given by either the Post Office Department or the Department of Public Works to the construction of a post office building at Iona, Victoria county, N.S.?


Hon. Jean-Pierre Cote (Postmaster General):: No. There has been no change in the situation at Iona, N.S. as indicated in our reply to question No. 369 on February 21, 1966 (see Hansard, page 1502).


EXPO '67-SALE OF UN STAMPS
Mr. Berger: Has a special understanding been reached with the Postmaster General of Canada in order to permit the sale and use of UN postage stamps at the proposed United Nations pavilion at Expo '67, as is currently the case at the head office of the organization in Manhattan, U.S.A.?


Hon. Jean-Pierre Cole (Postmaster General):: An understanding has been reached with officials representing the United Nations, whereby postage stamps issued by the Canada Post Office will be cancelled in the United Nations Pavilion at Expo '67 to identify them as postage on mail emanating from that source.

June 13. 1966
Questions
The policy of permitting use of United Nations postage stamps in payment for mail posted in Canada is not in accord with principles of our department.


AUDITOR GENERAL'S OFFICE
Mr. Caouetie: 1.	What have been the annual expenses of the Auditor General's office over the past five years?
2.	Does the Auditor General's office have a special section to deal with the auditing of the financial activity of crown corporations involved in commercial, industrial or financial activities?
3.	Over the past five years, how many accountants have there been each year in the employ of the Auditor General?
4.	Can the Auditor General audit the accounts of all the crown corporations?
5.	When the Auditor General audits the accounts of a government owned corporation, is he paid by the said corporation?


Mitchell William Sharp: The following answers have been prepared by the Auditor General:
1.	The annual expenses of the Auditor General's office, exclusive of the estimated value of major services provided by other departments, in the last five years are as follows: 1961-62, $1,069,939; 1962-63, $1,218,834; 1963-64, $1,258,359; 1964-65, $1,589,888; 1965-66, $1,741,900.
2.	One of the six branches of the office specializes in the audit of crown corporations but three of the other branches also do some of this work.
3.	The number of accountants in the employ of the Auditor General at March 31 in each of the last five years was as follows:
Members of recognized
March 31	accounting associations	Others	Total1962	30	103	1331963	36	103	1391964	37	105	1421965	47	104	1511966	64	108	1724. Yes.	Under section	77(2) of	the Financial Administration Act the Auditor General is eligible to be appointed the auditor or joint auditor of a crown corporation. The Auditor General is prepared to undertake any work assigned to him by parliament, the audit of any crown corporation of which he is appointed auditor by the governor in council and, with the approval of the governor in [Mr. Cote (Longueuil).)
council, the audit of any crown corporation of which he is appointed auditor by the corporation or by the minister responsible for the corporation.
5. No.


MAN POWER SERVICE LTD.
Mr. Brand: Has the Minister of Citizenship and Immigration received representations from Man Power Service Ltd., regarding the proposed use of the name "manpower service" by the department of manpower; and is he taking steps to ensure that the rights and privileges of this company will not be infringed by government action?


Mr. J. C. Munro (Parliamentary Secretary to Minister of Citizenship and Immigration):: Yes. See reply to question No. 1,499 on pages 5989 and 5990 of Hansard dated June 6, 1966.


HARBOUR DREDGING, MAHONE BAY, N.S.
Mr. Crouse: 1.	What is the name of the company, or the names of the men who carried out a survey in Mahone Bay harbour, Lunenburg county, Nova Scotia, in order to determine the amount of dredging required to accommodate the deep sea fishing draggers at present being constructed in that port?
2.	What facts were learned from this survey?
3.	What is the estimated cost of the required dredging?
4.	What is the approximate date on which dredging operations will be carried out?


Hon. G. J. Mcllraiih (Minister of Public Works):: 1. A sounding survey was carried out by engineers of the Halifax district office of the federal Department of Public Works.
2.	The survey provided information on the available depths of water in the harbour.
3.	This cannot be made until a further survey consisting of borings and probings is carried out this summer to determine the relative quantities of rock and class B material.
4.	No date has been established.


REPAIR OF WHARF, DAYSPRING, N.S.
Mr. Crouse: 1.	Has a study been made of the cost of repairing the public wharf at Dayspring, Lunenburg county. Nova Scotia and, if so, what is the estimated cost of repairing this wharf?
2.	Will funds be made available in 1966 to cover the cost of the necessary repairs to the Dayspring wharf and, if so, on what approximate date is it anticipated that repairs will be carried out?


George James McIlraith: 1. Yes. It is not usual to give the estimated cost before tenders are called.
June 13, 1966

2. Funds can be made available for these repairs in 1966 provided satisfactory arrangements for the leasing of the wharf or the payment of wharfage fees can be worked out between the commercial users of the wharf and the Department of Transport.


NATIONAL DEFENCE WAGE RATE CRITERIA, HALIFAX AREA
Mr. Douglas: Are different criteria used for determining wage rates, and hence different wage rates for the same job, at H.M.C.S. Shearwater, Dartmouth, and at H.M.C. Dockyard, Halifax, even though they are both in the same area and. if so, for what reason?


Hon. Leo Cadieux (Associate Minister of National Defence):: Except for a small number of highly specialized occupations which are not found in private shipyards, rates of pay for prevailing rate employees at H.M.C. Dockyard, Halifax, are determined by reference to the rates paid by seven shipyards in the maritime and St. Lawrence areas, whereas rates of pay at H.M.C.S. Shearwater are based on rates prevailing in the Dartmouth-Halifax area. In using different criteria for establishing rates of pay at these units, the Department of Labour through their wage surveys, and the treasury board in authorizing pay rates, give recognition to the relationship between work performed in the Dockyard and the ship repair or ship building activity, and at the same time maintain an appropriate relationship between trades at Shearwater and the construction, maintenance and allied trades in the area.


POST OFFICE BUILDING, ST. LAURENT, MAN.
Mr. Stefanson: Has the government any plans to build a post office at St. Laurent, Manitoba and, if so (a) has land been purchased (b) when will this project be proceeded with?


John Cole: No. The post office at St. Laurent, Manitoba is in the category of offices where the postmaster is normally responsible for the provision of suitable accommodation as a condition of employment.
(a) and (b) Not applicable.


GRANT FOR NURSING HOME, BENGOUGH, SASK.
Mr. Watson (Assiniboia): 1.	Has the government had a request from the Saskatchewan provincial government for assistance under N.H.A. to build a nursing home at Bengough, Saskatchewan?
2.	If so, how large a grant was requested?
Motion for Adjournment


John Robert (Jack) Nicholson: 1. No request has as yet been received.
2. Answered by 1 above.


MANITOBA PROJECTS, PLEASURE CRAFT HARBOURS PROGRAM
Mr. Stefanson: Have any projects been undertaken in Manitoba under the capital assistance for pleasure craft harbours program, and, if so, what are they and what is the location and estimated cost of each?


George James McIlraith: No.
[DOT] (3:00 p.m.)


LABOUR RELATIONS
Hon. Michael Starr (Ontario):: Mr. Speaker, I ask leave, seconded by the hon. member for Winnipeg South Centre (Mr. Churchill), to move the adjournment of the house under standing order 26 to discuss a matter of urgent public importance, namely the calamitous economic paralysis consequent upon the government's failure to bring about an end to the longshoremen's strike in Montreal, Quebec city and Three Rivers, or to take appropriate action toward the resumption of shipping in the face of a critical blockage of grain shipments, disruption of shipping generally, and the serious interference with the timetable of Expo, and the government's continued inactivity with regard to threatened strikes of employees of the St. Lawrence seaway, the Canadian National Railways and Air Canada.


Mr. Speaker:: Will the hon. member for Ontario kindly address the Chair on the question of urgency of debate.


Michael Starr: Mr. Speaker, the urgency of debate is based on the fact that for the past five weeks the nation has been faced with a disruptive strike that affects every aspect of our economy. We have had from day to day, from week to week, assurances by the government that the strike is near the end and that a solution is imminent by the hour. As late as last Thursday the Prime Minister of this country assured this house, and we took his word for it, that the end of the strike was imminent.
Over the week end, according to the press, a 17 hour discussion took place attended by at least three or four ministers, who were not able to bring about a settlement of this strike.

June 13, 1966
Motion for Adjournment Today the Minister of Labour is holding off any action on the part of the government by making another statement that the settlement of the strike is imminent. I do not think this country can stand another delay of 24 hours in view of the disruption of our economy which is affecting every part of this country.
In addition to this strike we are threatened with strikes on the St. Lawrence seaway, the Canadian National Railways and Air Canada, as is set out in my motion. In view of the experience this government has had with the longshoremen's strike, which has already lasted for five weeks, it is surprising that they are still coming up with the same formula of mediation until the last deadline; no doubt we will be faced with strikes which will paralyse this country completely. That is the reason for the urgency which I submit exists in this matter.


Thomas Clement (Tommy) Douglas: Mr. Speaker, there can be no doubt about the importance of the matter which has been introduced by the member for Ontario, and also no doubt about the urgency of finding some very quick solution to the problem he has outlined. It is certain that if the encouraging statement which was made by the minister had not been forthcoming, there would have been every justification for a debate on this matter this afternoon. Hon. members of the opposition are of course in the position of not knowing just how close to a settlement the two disputants are, nor do we know what are the various points still at issue. However, it seems to the members of this party that in view of the statement made by the minister there appears to be a real and genuine hope that the negotiation will be successful, and I fear that a debate at this time might be more injurious than helpful.
I hope the hon. member for Ontario will be prepared to either withdraw his motion or let it stand for 24 hours, and if this matter is not settled by tomorrow and the government has not come up with legislation, then there would be every reason for having the debate. There can be no doubt that the public is impatient and fed up with the long delay in grappling with this problem, but if the longshoremen and the federation are close to a settlement a debate at this time might do more harm than good.
For this reason I hope the hon. member for Ontario will be prepared to postpone his motion until tomorrow in order to give the minister one more chance to try to effect a

satisfactory settlement of this unfortunate dispute.


Gilles Grégoire: Mr. Speaker, we are completely in agreement with the remarks of the hon. member for Burnaby-Coquitlam (Mr. Douglas). We believe the question is urgent and pressing. On the other hand, the Minister of Labour (Mr. Nicholson) has just announced that negotiations would continue at four o'clock and that there was definite hope at that time of finding a solution to this grave problem.
A debate now might be useless. Yet, in view of the importance and urgency of the problem, I wonder whether the hon. member for Ontario (Mr. Starr) would agree, with the consent of the house, to postpone his motion until seven o'clock tonight instead of tomorrow afternoon? The question is undisputedly most urgent and pressing. If, at seven o'clock tonight, further to the negotiations which the Minister of Labour and some of his colleagues are to have with the two parties involved, no solution has been found, then I feel we might agree to a resumption of this debate.
If the government does not come up with a solution settlement or does not propose any legislation, then the debate will be necessary so that other members of the cabinet and of the house may suggest motions to settle this strike which has been going on much too long already.
Mr. Speaker, as the hon. member for Burnaby-Coquitlam (Mr. Douglas) said a moment ago, the matter is most urgent. We know that this strike is paralysing many areas of the economy of the country and of the province of Quebec, and we believe it must be settled at the earliest.
If no solution can be found during the discussion which will be held this afternoon, we could then postpone the debate until seven o'clock tonight or, at most, until 2.30 tomorrow afternoon.
Even though we feel the debate is urgent, we would rather await the outcome of the negotiations this afternoon and resume the debate at seven o'clock after private members' hour.
CEnglish1


Robert Norman Thompson: Mr. Speaker, there is no doubt at all about the urgency of the motion that has been moved in view of the strike threat to the national economy. We are not just referring to the longshoremen's strike today but to a possible
June 13, 1966

Air Canada strike, the St. Lawrence seaway employees' strike and the threatened general strikes in transportation and of the international woodworkers in British Columbia as well. We could go on with the list. In the debates on this matter in the house it is essential that we look at the problem in that light.
It would seem only reasonable that to demand that the government make statements now in a debate that might ensue would only jeopardize the hope of a successful outcome of the negotiations this afternoon. It would seem to me much more reasonable to set this debate aside for a period of 24 hours in the hope that negotiations, which will start in less than an hour, might bring about a fruitful agreement. If this does not come about, then there will be reason for discussing this topic in a general debate in the house.


John George Diefenbaker: Mr. Speaker, there is only one point I wish to make, and it concerns a matter which hon. members who have previously spoken on the motion have lost sight of. It concerns the last three lines of the motion, which read as follows:
-and the government's continued inactivity with regard to threatened strikes of employees of the St. Lawrence seaway, the Canadian National Railways and Air Canada.
Today we are in the position of being faced with a strike of the St. Lawrence seaway employees which is to take place on Friday, and which will adversely and irreparably affect the Canadian economy. We are also faced with a strike of Air Canada which is tentatively set for Wednesday. No statements have been forthcoming on these two strikes. The threatened strike of the Canadian National Railways has been postponed, but the other two are at hand. Nevertheless, when we raise questions concerning these strikes the answer is that there is no urgency. May I point out that we are told that although there is urgency in solving the problem, there is no urgency in informing parliament.
May I ask you, Mr. Speaker, in making your ruling to take into consideration this additional paragraph which has not been answered by the inadequate statement made today so far as the stevedore strike is concerned; nor does the statement deal with the two serious projected strikes which will further paralyse this nation.


Mr. Speaker:: May I advise the hon. members that I am now in a position to make a
Motion jor Adjournment ruling, unless hon. members insist that the minister make a statement.


Allan Joseph MacEachen: Mr. Speaker, one would gather from the comments that have been made by the Leader of the Opposition this afternoon that we have abolished free collective bargaining in Canada.


Michael Starr: Sheer nonsense. This is a smokescreen.


Allan Joseph MacEachen: We have here a system of free collective bargaining, and it is the earnest endeavour of the government to reach a solution to these difficult labour situations through the procedures which have been established by law under that system of free collective bargaining.
[DOT] (3:10 p.m.)
With respect to the Canadian National Railways, to which the Leader of the Opposition has referred, the process of conciliation, a procedure established by the law of Canada, has just commenced. Certainly it is to cry alarm to suggest at the moment that this is a matter for urgent debate in the House of Commons on June 13.
In the case of the two other disputes involving Air Canada and the seaway, the process of mediation is actively under way and in each case an experienced mediator is dealing with the issues in dispute. I believe these established procedures ought to be given an opportunity to adjust themselves before it is suggested in this house that precipitate parliamentary action ought to be taken in these cases. Surely these gestures which are taken every day are undermining the process of free collective bargaining, which is the basic cornerstone of our dispute settlement procedure in Canada.
With respect to the immediate issue, Mr. Speaker, it is suggested that the ordinary business of the house be set aside in order to debate the longshoremen's strike, presumably with the objective of securing constructive statements from members of the House of Commons as to how this matter ought to be dealt with. The Minister of Labour provided an opportunity to the party spokesmen to make these suggestions when he made a statement earlier in the afternoon; and we certainly sensed the quality of such suggestions from the remarks which were made by the Leader of the Opposition. I suggest the opportunity has already been given this afternoon to the spokesman of each party to

June 13, 1966
Motion for Adjournment express himself on how the matter ought to be dealt with.
Furthermore, Mr. Speaker, if this motion were accepted today and a debate were initiated the Minister of Labour and the rest of the ministers would have to postpone the meetings slated for 4	p.m.,	45 minutes
from now, and the process of negotiation would have to be postponed in order for a debate to take place in parliament. I would ask hon. gentlemen to consider that point. The acceptance of this motion this afternoon would mean that no discussion or negotiations with the parties could take place this afternoon.
I make one final point, Mr. Speaker. The allegations made in the motion are incorrect. Real and substantial progress has been made over the week end.


An hon. Member:: Were you there?


Allan Joseph MacEachen: Yes, I was there. Real progress was made in narrowing the issues in this dispute, so much so that one local of the I.L.A., Trois-Rivieres, has already accepted the final proposals hammered out at these negotiating sessions over the week end. In addition, Mr. Speaker, the local at Quebec city has accepted these proposals subject to one minor point.
Surely the objective of the House of Commons and the government at the moment, in light of these developments and in light of the real desire of the parties to settle, should be to allow a further opportunity for intensive negotiations to take place so the system of free collective bargaining can be observed, and so that parliamentary action, which is so repugnant, can be avoided.


Mr. G. W. Baldwin (Peace River):: Mr. Speaker, I should like to recall to your attention that the issue before you is the question of urgency of debate, which seems largely to have escaped the Minister of National Health and Welfare, who has dealt with other matters.
Mention has been made of precipitate parliamentary action. I would point out, sir, that if parliamentary action follows the normal procedures, according to our standing orders a number of hours' notice must be given of any legislative proposal. If this matter is debated in its normal course it might well be Thursday at the very earliest before parliament, if it does desire to act, can act. Thursday is the day preceding the strike announced by the seaway employees.

I would also point this out, Mr. Speaker. I agree with one thing said by the Minister of National Health and Welfare about normal collective bargaining powers, but it is about time the members of this house had an opportunity to express the views of those whose interest is even greater than the interests of the two parties concerned in this issue. I am referring to the national interest. I suggest to you that at this time-it is this point on which urgency of debate largely rests-the members of this house, representing as they do the people of Canada who have a greater and more vital the overweighing interest in this issue than anybody else, should be given the opportunity to express their views. If these views were properly and moderately expressed at this time, then if the parties to this dispute are as close together as the Minister of Labour suggests-and I do not doubt what he said-these expressions might do a great deal to push the parties the final mile and bring about the settlement which we all so devoutly desire.
[Translation1


Mr. Mongrain:: Mr. Speaker, on a point of order.
I have always looked upon the hon. member for Ontario (Mr. Starr) as a star in the field of parliamentary procedure but his star loses its sheen when he calls my city the city of Three Rivers. I should like to remind him that it is called Trois-Rivieres.
[English1


Mr. Speaker:: Order, please. I thank hon. members for their comments in connection with the question of urgency of debate, which is the point which had to be considered. As has been pointed out by the Leader of the Opposition, there are two aspects to this motion. The first one deals with the strike of longshoremen at Trois-Rivieres, Quebec and Montreal; the other aspect deals with the labour difficulties of the Canadian National Railways, Air Canada and the seaway.
I have some doubt on the procedural aspect of this motion, as it deals with more than one matter. Under the terms of standing order 26 (6) (b):
-not more than one matter can be discussed on the same motion;
But perhaps this is a procedural difficulty, and I should not like to make a ruling specifically on this point.
In connection with the second aspect of the motion moved by the hon. member for Ontario, there does not appear to me to be the
June 13, 1966

urgency of debate which is required under standing order 26 or by citation 100 of Beauchesne. Because of this I would have serious reservations about allowing the adjournment of the ordinary business of the house to discuss the second aspect of the motion.
In so far as the first part of the motion is concerned, in view of the statement made by the Mininster of Labour I feel it might be wiser on the part of the Chair to say that the motion cannot be accepted at this time.


LABOUR CONDITIONS
[Stage Direction]
REVIEW OF EFFECTS OF AUTOMATION On the orders of the day:
John George Diefenbaker: Mr. Speaker, would the Prime Minister be able to tell the house, in view of the fact that one of the major elements of dispute so far as labour is concerned is the effect of, and result that follows from, automation, whether the government is giving consideration to setting up a commission to review in detail the general position created in employer-employee relations by reason of technological change, a matter that is of prime importance in connection with the various disputes which are arising?


Lester Bowles Pearson: Mr. Speaker, the matter mentioned by my right hon. friend is, of course, one of very great and continuing significance, as we have learned-if we needed to learn-from the dispute that we have been discussing. It may well be, Mr. Speaker, that if the house requires an opportunity to discuss this particular dispute, this will be one of the elements that we will be discussing. I quite agree that it should be considered in its wider context. I think it would be the feeling of the house that the government would give consideration to an examination of the kind suggested by my right hon. friend.


LABOUR RELATIONS
[Stage Direction]
REQUEST FOR REPORT ON POSSIBLE STRIKES On the orders of the day:
Thomas Clement (Tommy) Douglas: Mr. Speaker, in view of the statement which the Minister of Labour made earlier in the day with reference to the longshoremen's strike, I wonder whether he would give the house an interim report on the negotiations with respect to the Air Canada personnel
Inquiries of the Ministry dispute, the employees of which group had set a deadline for June 15, and the dispute between the seaway authority and the seaway employees, where again a deadline has been set for June 17. Could the minister tell us what successes the two mediators are having in bringing the parties together, and whether the minister thinks it is likely that strikes can be averted in both cases.


John Robert (Jack) Nicholson: Dealing first with the Air Canada matter, the mediator, who is Mr. Bernard Wilson, is the director of industrial relations in my department and has had very broad experience in this field. He has been successful in bringing the parties together again. They were in session all morning. Negotiations were resumed at 2.30 this afternoon, and are still going on.
With regard to the seaway dispute, it does not seem so very long ago, notwithstanding the novel week end that I put in, that I announced the appointment of a mediator with very broad experience in dealing with industrial relations. He spent Friday and Saturday here, in Ottawa, studying the problems and doing research so that he would be prepared to discuss matters intelligently. Yesterday he motored to Cornwall and worked there, even though it was Sunday. He began working again this morning. There is a strong probability that the scene will be transferred to Ottawa. Again, I am hopeful that Hon. Norman MacKenzie's efforts will result in averting any interruptions of operations on the seaway.


Thomas Clement (Tommy) Douglas: A supplementary question, Mr. Speaker. May I ask the minister whether any time has been set for the mediator in the seaway dispute to meet either of the parties in the negotiations?


John Robert (Jack) Nicholson: They met this morning.
[Translation1


BANK OF CANADA
[Stage Direction]
On the orders of the day:
Gilles Grégoire: Mr. Speaker,
I would like to put a question to the Minister of Finance.
As we are to consider this afternoon second reading of Bill C-190, an Act to amend the Bank of Canada Act, can the minister tell us whether he intends to refer it to the finance,
June 13, 1966

Inquiries of the Ministry trade and economic affairs committee after that debate?
IEnglish]


Mitchell William Sharp: Yes, Mr. Speaker.


NATIONAL DEFENCE
[Stage Direction]
On the orders of the day:
Robert Norman Thompson: Mr. Speaker, my question is directed to the Minister of National Defence. Does the statement of R.C.M.P. Commissioner McClellan made in Vancouver over the week end, to the effect that the Penhold air base is to be turned over to the Royal Canadian Mounted Police as a training centre, mean that the Department of National Defence has relinquished the base and its announced plans to continue the base as a training centre for the new integrated defence forces?


Mr. Speaker:: Order, please. This question is not urgent and should be placed on the order paper.


Robert Norman Thompson: With all due deference to your decision, Mr. Speaker, it is a very urgent question because obviously it concerns a conflict between two departments. One department has stated that the base is to be turned over to the R.C.M.P., and the other has stated that it will not be. I submit there is a certain amount of urgency in this respect.


Mr. Speaker:: By placing the question on the order paper the hon. member will give an opportunity to the departments to get together.


SUGGESTED CHANGE IN JURISDICTION OVER WHEAT BOARD
[Stage Direction]
On the orders of the day:
Mr. Reynold Rapp (Humboldi-Melforl-Tisdale):: Mr. Speaker, my question is addressed to the Minister of Finance. Could the minister inform the house whether he took note of the statement made by the Minister of Agriculture, (Mr. Greene) that the Canadian Wheat Board should come under his jurisdiction, where it rightly belongs, and not under the jurisdiction of the Minister of Finance. If so, when will the transfer take place?


Mitchell William Sharp: Mr. Speaker, I did not take note of the statement.


An hon. Member:: Neither did I.


HEALTH AND WELFARE
[Stage Direction]
On the orders of the day:
Mr. P. V. Noble (Grey North):: Mr. Speaker,
I wish to direct a question to the Minister of National Health and Welfare. In view of the statement made last Saturday by Dr. Alton Ochsner of New Orleans after performing 4,000 lung operations, that to smoke cigarettes is to commit suicide and that a bullet is cheaper, quicker and no pain is involved, will the minister, in view of this situation, advise what action he plans to take?


Mr. Speaker:: That is a good question for the order paper.


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
Mr. David MacDonald (Prince):: Mr. Speaker, my question is directed to the Prime Minister, and concerns his remarks in Springfield, Illinois, on Saturday. I wonder if he can tell the house whether or not the United States government was aware of his remarks prior to his address-


Mr. Speaker:: Order, please. This question is not in order.


David Samuel Horne MacDonald: A supplementary question, Mr. Speaker. May I ask the right hon. gentleman whether or not there has been any reaction to his remarks, as I believe he made some very interesting proposals in that address.


Mr. Speaker:: Order, please. I do not think this question is very urgent and should not be asked at this time.


David Samuel Horne MacDonald: Could I put this question, Mr. Speaker. In the light of the Prime Minister's remarks of Saturday afternoon, is he recommending or is his government going to recommend at some future date a federal union of North Atlantic countries which would provide for some kind of collective political and economic policies?
June 13, 1966


Mr. Speaker:: Order, please. The question is rhetorical.


Mr. David Lewis (York South):: Mr. Speaker, I wish to direct a question to the Prime Minister arising out of his speech at Springfield, Illinois. I would ask the right hon. gentleman what steps he proposes to take to implement the interesting suggestions for the alliance which he made in that speech.


Lester Bowles Pearson: All appropriate steps, Mr. Speaker.


[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, in order to give relief for a few minutes to the Minister of Labour, I wish to address a question to him and to go from the national to the international scene. Can the minister inform the house whether the United States labour delegation to the International Labour Organization conference at Geneva continues to boycott the conference because of the election of a Polish delegate?


Mr. Speaker:: Order, please. I doubt whether this question should be asked at this time.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Mr. J. P. Nowlan (Digby-Annapolis-Kings):: Mr. Speaker, my question is directed to the Minister of National Defence and involves a speech made over the week end. I wonder whether the minister is aware of a speech made by Air Vice Marshal Reyno before an Ottawa service club on Friday, June 10, in which debatable and argumentative statements were made on defence policy concerning service morale, pilot pay increases and integration. If the minister is aware of the speech, was it cleared by him? Can other officers and men in the services now make statements on similar questions of government policy?


Mr. Speaker:: Order, please. I would suggest that this question might be placed on the order paper.
6301
Inquiries of the Ministry


John Patrick (Pat) Nowlan: Mr. Speaker, without challenging too severely your ruling, which I respect, this is not similar to the question put by the hon. member for Prince, who was not allowed to put his question to the house. I do believe, Mr. Speaker, that many officers and men in the services would speak out-


Mr. Speaker:: Order, please.


John Patrick (Pat) Nowlan: -if a change in government policy were made.


Mr. Speaker:: Order, please. The hon. member is making an argument. I am sure he will find an opportunity to do so, but it should be on another occasion. It should not be done at this time.


John Patrick (Pat) Nowlan: Ten o'clock, Mr. Speaker. SHIPPING



CLEARANCE OF SHIPS IN SEAWAY IN EVENT OF STRIKE

[Stage Direction]
On the orders of the day:
['Order.']
Mr. W. C. Scott (Victoria (Ont.)):: Mr. Speaker, my question is for the Minister of Transport. In the event of a strike being called by the seaway employees at noon on June 17, would any ships in the St. Lawrence seaway system at that time be guaranteed clearance from the seaway?


Hon. J. W. Pickersgill (Minister of Transport):: Mr. Speaker, this is a hypothetical question-


Mr. Speaker:: Order, please. I thank the hon. Minister of Transport for making his ruling on my behalf.



[Stage Direction]
On the orders of the day:
Robert Norman Thompson: My question is for the Prime Minister, although it might be more appropriately addressed to the Secretary of State for External Affairs (Mr. Martin) or to his parliamentary secretary neither of whom is here at the moment. It is reported that the United Nations Secretary General U Thant has recommended that the Cyprus peace keeping mission be extended for another six months.
In view of Canada's large commitment to this operation has the Canadian government been consulted in advance on this matter, and what is the government's position?
6302	COMMONS
Inquiries of the Ministry


Lester Bowles Pearson: This report was issued only this morning in New York, though I believe it is dated June 10, and I would prefer to reserve any detailed comment on it until the Secretary of State for External Affairs and myself have had an opportunity to study the full text, which I have just seen.
Perhaps I might say, however, that the report pointed out that the continued presence of the force in Cyprus is indispensable if a danger of recourse to violence and conflict is to be avoided. Then again, to ensure better planning and greater economy, the Secretary General has recommended in his report that the force be sent for six months rather than for three months. The Security Council is to consider this recommendation on Thursday of the present week, I understand.
While the Secretary General noted there was still tension on the island, he pointed out that the situation has remained stable and that the good offices of his representative will continue to be available to the parties.
In this connection the Greek and Turkish foreign ministers had discussions in Brussels last week while the NATO Council meeting was being held, and agreed to continue those discussions. At that time the Secretary of State for External Affairs told both foreign ministers in Brussels that the Canadian government very much welcomed these discussions and the recent public assurances of both governments that they wish a peaceful solution to the Cyprus problem. We shall be studying the Secretary General's report in greater depth, and if a statement is required it can be made within a day or two.


Mr. D. V. Pugh (Okanagan Boundary):: A supplementary question. Is Canada still bearing the full cost of this operation?


Lester Bowles Pearson: We are carrying the expenses of our part of the force, Mr. Speaker.


David Vaughan Pugh: With no participation from other United Nations members?


Mr. Speaker:: Order.



LABOUR RELATIONS


[Stage Direction]
On the orders of the day:
Gilles Grégoire: Mr. Speaker, I wish to put a question to the hon. minister of manpower.

DEBATES	June 13, 1966
Can the minister tell us if he is one of the ministers presently working on finding a solution to the longshoremen problem?


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


Gilles Grégoire: Mr. Speaker-


Mr. Speaker:: Is the hon. member rising on a point of order?


Gilles Grégoire: Is my question in order?


Mr. Speaker:: I feel that it should not be, as it does not strike me as urgent; moreover, I do not think it is essential that the hon. member should know whether or not the hon. minister is a member of a certain group.


Gilles Grégoire: Mr. Speaker, in that regard,
I rise on a point of order.
First of all, my question is urgent, because tomorrow it will be too late to know; the negotiations will be over. Second, it is important that we should know, because we feel that if the hon. minister of manpower were a member of the committee of ministers involved, there would be a greater chance for success than otherwise. That is why I feel the question is urgent and important.


Mr. Speaker:: Order. The hon. member's representations will, I assume, be duly taken into consideration.
[English1



NORTHERN AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. Erik Nielsen (Yukon):: May I ask the
Minister of Northern Affairs and National Resources whether the government has yet made a decision on the replacement of the head of the government of the Yukon and, if not, when we may expect such an appointment to be made?


Hon. Arthur Laing (Minister of Northern Affairs and National Resources):: When the commissioner is appointed an announcement will be made in the house.


Erik Nielsen: In the interim, while a decision is being made, is it the intention of the government to pass the necessary order in council to clothe the temporary administrator with the powers of a commissioner?


Arthur Laing: I am informed that all the functions of the commissioner are now being exercised.
June 13, 1966


Erik Nielsen: May I address a further supplementary question to the minister, then, and ask him under what authority the administrator is exercising these powers?


Mr. Speaker:: Order. The question is out of order.



OLD AGE SECURITY


[Stage Direction]
On the orders of the day:
Mr. Barry Mather (New Westminster):: have a question for the Minister of National Health and Welfare. Bearing in mind reports which have appeared today and yesterday to this effect, can the minister say whether he and the cabinet have given consideration to improving old age security pensions by the provision of a bonus?


Mr. Speaker:: Order. This question is of a very general nature and cannot be asked at this time.



COMMONWEALTH RELATIONS


[Stage Direction]
On the orders of the day:
David Samuel Horne MacDonald: Undaunted, I press on. If need be, I appeal to the Minister of Transport for his ruling. I should like to ask the Prime Minister whether, in light of the meeting to be held shortly with heads of government of the British West Indies, the right hon. gentleman is contemplating a monetary and customs union with these islands-


Mr. Speaker:: Order. This question, again, is of a very general nature, and I have to remind hon. members that questions of this kind are out of order and cannot be asked at this time.


David Samuel Horne MacDonald: In the light of the rapidity with which events are moving in this area, is it not important that the country be made aware of the steps which may possibly be taken by this government-


Mr. Speaker:: Order. The hon. member has just done that.



HIGHWAY SAFETY


[Stage Direction]
On the orders of the day:
Percy Verner Noble: I have a question for the Prime Minister. Does he
Inquiries of the Ministry agree with chief metro coroner Morton Shulman who says it appears unlikely that early action on traffic safety will be undertaken by senior levels of government, and the hope of immediate improvement must lie at the municipal level?


Mr. Speaker:: Order. This question must be placed on the order paper.



THE CANADIAN ECONOMY


[Stage Direction]
On the orders of the day:
Mr. G. H. Aiken (Parry Sound-Muskoka):: My question is directed to the Prime Minister. In view of the further rise in the cost of living index published by the Dominion Bureau of Statistics on Friday showing an increase of 5.4 in the past year, is the government giving consideration to urgent measures to hold the line?


Lester Bowles Pearson: While any increase is, of course, regrettable, I would point out that this amounts to one tenth of one per cent, and I am glad it is a very small one. I can assure the hon. member that this is a matter which is of the greatest possible urgency and importance, and that it is being given continual attention by the government.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. Thomas M. Bell (Saint John-Alberl):: question for the Prime Minister: Has the government received the unanimous resolution passed by the New Brunswick legislature last week calling for the redesignation of Saint John and Fredericton under the incentives program and, if so, will the Prime Minister reply, in detail, in the house, now or later, to this proposal?


Lester Bowles Pearson: I do not recall having seen this resolution, but I had better check to make sure.



POST OFFICE DEPARTMENT


[Stage Direction]
On the orders of the day:
Thomas Clement (Tommy) Douglas: should like to ask the Postmaster General

June 13, 1966
Inquiries of the Ministry whether he has received a telegram from the British Columbia and Yukon postmasters in conference assembled in Kamloops protesting about the fact that they have not been given the same increase in salary as senior postmasters, and asking for a 15 per cent increase. Will the minister be able to comply with their request?


Mr. Speaker:: Order. I suggest to the hon. member that this question be placed on the order paper.


Thomas Clement (Tommy) Douglas: On a point of order. The postmasters are concerned about this matter.
I have a question on the order paper now which has been there for three months, and if questions are to lie there for three months, surely we should not be asked to put a question of this kind on the order paper when the minister can tell us immediately whether or not action has been taken.
tTranslation1



INQUIRY FOR RETURN

[Stage Direction]
On the orders of the day:
['Order. It is not only intriguing, it is out of order.\n[DOT] (3:40 p.m.)']
Mr.   J.-A. Mongrain@Trois-Rivieres: Mr. Speaker, my question is for the Minister of Transport.
In view of the fact that on February 2 the house adopted a motion for the production of papers concerning the Trois-Rivieres bridge and that, furthermore, I have twice inquired about the date they would be tabled, could the minister tell me when I will get those documents?
[English!


John Whitney Pickersgill: I am having the matter looked into. I think a reservation was made at that time that documents which represented exchanges with the provincial government would be tabled only with the consent of the provincial government. Certain events in Quebec of recent date have perhaps made it a little difficult for a lot of time to be spent examining the archives.



[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: have a rather intriguing question to ask the Prime Minister, of which I have not given him notice. Did the Secretary of State for External Affairs inform the Prime Minister
[Mr. Douglas.)
that the government of Belgium informed the NATO Council that their recent meeting in Brussels caused some embarrassment to that government?


Lester Bowles Pearson: That is indeed a very intriguing question-


Mr. Speaker:: Order.


Lester Bowles Pearson: -but I am afraid at the moment I do not have an intriguing answer.


Mr. Speaker:: Order. It is not only intriguing, it is out of order.
[DOT] (3:40 p.m.)



CANADA STUDENT LOANS ACT


Mitchell William Sharp: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to amend the Canada Student Loans Act to increase provincial allocations for the loan year commencing July 1, 1965 and subsequent loan years by authorizing the Minister of Finance, on application by a province, to determine a supplementary allocation for that province in an amount not exceeding 20 per cent of the basic loan provision for that year and by increasing to $58 million the basic loan provision for the loan year commencing in 1965: and to provide also for a certain change in connection with the administration of the act.
Motion agreed to and the house went into committee, Mr. Batten in the chair.


Mitchell William Sharp: Mr. Chairman, hon. members will recall that the Canada student loans plan came into operation just prior to the beginning of the 1964-65 academic year. This program was the government's first major step in providing student assistance on a large scale toward the objective that all those in Canada who have the scholastic qualifications and who want to get a college education or its vocational equivalent will not be prevented from doing so for financial reasons.
Today, after nearly two years of operation there is no doubt that the Canada student loans plan has been very highly successful in helping to meet this objective. During the first loan year over 42,000 students were assisted under the plan, and in the current loan year up to the end of March loans have been authorized to over 50,000 students, and total loans outstanding under the plan at that time had risen to approximately $57 million.
I would like to recall briefly the main features of the plan and to outline developments in effective demand for student loans during the past two years which give rise to
June 13, 1966

the resolution preceding the measure which will shortly come before the house.
Loans under this plan may be made by banks and certain credit unions to full-time students at universities and other postsecondary educational institutions which have been designated by the participating provinces for purposes of the plan. In keeping with provincial responsibilities in the field of education, the loans are made on the basis of certificates of eligibility which are issued by the participating provinces. A student must obtain a certificate of eligibility before approaching a bank for a loan. A student may qualify for loans up to $1,000 per academic year and up to $5,000 over his entire postsecondary educational career.
The loans made under this legislation are interest and repayment free to the borrowers while they are full-time students, and for the next following six months. During that time interest is paid to the banks and other lenders on behalf of the students by the government of Canada which also guarantees the lenders against loss. After this period, the principal and interest on the loans are repayable by the students on a monthly basis and may be spread over a period of up to ten years from graduation.
The total of loans that may be authorized through the issue of certificates of eligibility, and this is directly relevant to the resolution now before the committee, is limited for each loan year by the total loan provision established by this legislation and by the allocation of this amount among the provinces.
The provincial allocations during the first loan year were determined by dividing the total loan provision of $40 million for that year among all provinces and territories on the basis of population in the 18-24 year age group. Of this amount approximately $27 million was allocated to participating provinces, and approximately $13 million to the province of Quebec which is relying on its own plan and does not participate in the Canada student loans plan. The act provides that this total loan provision will increase each year by the estimated rate of increase of Canada's population in the 18-24 year age group.
The loan provision in the initial legislation was based on the best projection that we, in consultation with provincial officials, could make of the likely demand for student loans. In practice, the demand has exceeded expectations by a considerable margin. The demand for loans even during the first loan
Canada Student Loans Act year pressed against the limits of loan allocations in a few provinces. In November, 1964, the house approved a measure authorizing the Minister of Finance to increase the total allocations of individual provinces during the first loan year up to an aggregate of $8 million.
With the permission of the house, I would like to include in Hansard at this point a table which shows the provincial allocations for the first loan year, and the extent to which they were used.


Thomas Clement (Tommy) Douglas: Could the minister give us some idea of the allocations now?


Mitchell William Sharp: This first table, which I suggest should be printed in Hansard, shows that out of $30,266,000 authorized both in the original legislation and in the supplementary measure, some $26,748,000 was used. Several provinces had to take advantage of the additional aid program, notably Prince Edward Island, Nova Scotia and Ontario. The others lived within the original allocation. These figures are with respect to the first year of the legislation.


Thomas Clement (Tommy) Douglas: Could the minister tell us what provinces did not use their full allocation?


Mitchell William Sharp: I could give the amounts in round figures for each of the provinces. Out of a provincial allocation of $1,176,000 for Newfoundland, $459,000 was used. In Prince Edward Island out of $232,000 which was the original allocation, plus an additional $60,000, a sum of $289,000 was used. In Nova Scotia which had a total of $1,736,000 in the original allocation plus $170,000, for a total of $1,906,000 a sum of $1,766,000 was used. In New Brunswick out of $1,416,000 a sum of $1,356,000 was used. Ontario had an original allocation of $12,440,000, to which was added another $3 million bringing it up to $15,440,000, of which $14,372,000 was used. The figure for Manitoba was $1,968,000 provincial allocation of which $1,383,000 was used. The provincial allocation in Saskatchewan was $1,908,000 of which $1,888,000 was used. In Alberta the figure was $2,852,000 of which $2,102,000 was used; in British Columbia $3,236,000 of which $3,110,000 was used; in the Yukon $24,000 of which $8,000 was used, and in the Northwest Territories $48,000 of which $9,000 was used.
[Editor's Note: The table above referred to is as follows:]
June 13, 1966

Canada Student Loans Act
Canada Student Loans Plan Report on Certificates of Eligibility Issued during loan year ended June 30, 1965
Total amount of loans authorized by Provincial certificates allocation	issued

Newfoundland	1,176,000	459,652
Prince Edward Island	232,000 60,000*	
	292,000	289,904
Nova Scotia	1,736,000 170,000*	
	1,906,000	1,766,873
New Brunswick	1,416,000	1,356,088
Ontario	12,440,000 3,000,000*	
	15,440,000	14,372,527
Manitoba	1,968,000	1,383,495Saskatchewan	1,908,000	1,888,445Alberta	2,852,000	2,102,819British Columbia	3,236,000	3,110,751Yukon	24,000	8.600Northwest Territories	48,000	9,00027.036.000 3,230,000*	Total	30,266,000	26,748,154
Special increase for 1964-65 loan year.


Mitchell William Sharp: During the first year of operation, each province administered the plan without much reference to the practices being followed by the other provinces because time had not permitted the development of uniform standards. Careful consideration, however, was given to this subject in a series of federal-provincial meetings of officials during the first year. These consultations resulted in three federal-provincial reports on common administrative criteria for use by the participating provinces during the second loan year.
These reports, which appear in Appendix A to Hansard of June 11, 1965, deal with detailed criteria for determining a student's financial need, his provincial residence status, and certain definitions relating to the designation of educational institutions and other matters.
The process of developing these common criteria has been a continuing one. Improvements and refinements in two of these reports are being worked out, and revised

versions of these reports may soon be agreed to by the provinces and the federal government on the same basis as last year. The development of a co-ordinated approach to the administration of this plan is a fine example of federal-provincial and interprovincial cooperation. It has contributed immeasurably to the successful way in which students have been able to make use of the plan and provides assurance that the plan is being used effectively.
The second loan year began on July 1, 1965. Three months later, at the beginning of the new academic year, it became apparent that loan demand in all provinces was exceeding that experienced during the previous year, and could be expected to exceed by fairly wide margins the provincial allocations for that new loan year.
With the introduction of new agreed criteria governing the authorization of loans, the government was satisfied that this increase reflected a real and effective need for loans by students across Canada.
[DOT] (3:50 p.m.)
Action was required in these circumstances to enable the provinces to continue issuing certificates of eligibility on the basis of the agreed criteria. Otherwise, many deserving students would be refused loans during the latter part of the loan year. Because parliament was then not in session, the provinces were encouraged to place reliance on a section in the act which contemplates the issue of certificates in one year in excess of allocations of that year, by providing for the deduction of such an overrun from the next year's allocation, and the government undertook to place before parliament in the next session appropriate legislation that would obviate the need to charge allocation overruns against the following year's allocation.
On the strength of this undertaking, the provinces continued to meet the increasing demand for student loans and, in doing so, exceeded in most instances their respective provincial allocations for the current loan year. With the permission of the house, I would like to include in Hansard another table showing current allocations and certificates actually issued by participating provinces during the period from July 1, 1965 to to March 31, 1966.
[Editor's note: The table above referred to is as follows:]
June 13, 1966	COMMONS DEBATES
Canada Student Loans Act
Canada Student Loans Plan Certificates of Eligibility Issued (Loans Authorized by Provinces)
During Loan Year Commencing July 1. 1965
	Provincial	Certificates Issued	
Allocations	(July 1,1965-	-March 31, 1966)for	No. of	Total Amount1965-66	Students	of Loansloan year	Assisted	AuthorizedNewfoundland	$ 1,243.000	1,314	$ 891,016Prince Edward Island	248,000	613	454,210Nova Scotia	1,772,000	3,767	2,926,780New Brunswick	1,520,000	2,988	2,400,541Ontario	13,090,000	20,022	14,908,366Manitoba	2,003,000	3,431	2,306,380Saskatchewan	1,995,000	4,830	3,292,299Alberta	2,911,000	6,333	3,277,811British Columbia	3,519,000	7,090	4,977,279Yukon	29,000	23	19,119Northwest Territories	50,000	8	7,115$28,380,000	50,419	$35,460,916


Mitchell William Sharp: This indicates that loans authorized by participating provinces during the first three quarters of the loan year amounted to some $35 million. This total will probably rise to about $38 million by the end of the loan year on June 30, 1966 which would mean that participating provinces will have exceeded their allocations this year by about $10 million.
I have the table before me, Mr. Chairman, and perhaps I should just give some of the figures by way of comparison. The provincial allocations for the provinces are: Newfoundland, $1,243,000 with loans authorized in the amount of $891,000; Prince Edward Island, $248,000 with loans authorized in the amount of $454,200; Nova Scotia, $1,772,000 with loans authorized in the amount of $2,926,000; New Brunswick, $1,520,000 with loans authorized in the amount of $2,400,000; Ontario, $13 million with loans authorized in the amount of $14,908,000; Manitoba, $2,003,000 with loans authorized in the amount of $2,306,000; Saskatchewan, $1,995,000 with loans authorized in the amount of $3,292,000; Alberta, $2,911,000 with loans authorized in the amount of $3,277,000; British Columbia, $3,-
519,000	with loans authorized in the amount of $4,977,000; Yukon, $29,000 with loans authorized in the amount of $19,119 and the Northwest Territories, $50,000 with loans authorized in the amount of $7,000. So against provincial allocations of $28 million there have been loans authorized to the extent of $35 million.


Thomas Clement (Tommy) Douglas: May I ask the minister a question? 1 notice that in the first year of operation some provinces did not use their full allocations, and that during the second year many of them exceeded their allocations. Will they be able to charge the excess back to the year they did not use the full amount?


Mitchell William Sharp: No. We are proposing by this legislation to enable them to get an additional allocation for this year.
The measure now before the house would, first, increase the total loan provision, or the basic loan provision, for the current loan year from approximately $42 million to $58 million which will be allocated to provinces in the normal way on the basis of population in the 18-24 year age group. The allocations for participating provinces would increase from approximately $28 million to about $39 million. Second, it provides for an additional and discretionary loan provision equal to 20 per cent of the basic loan provision which may be allocated by the minister to provinces as required.
The provision for such a discretionary loan amount recognizes that there have been in practice differences in the levels of relative loan demand from province to province reflecting differences in the number of students, in regional income pattern, in the nature and magnitude of provincial student aid schemes and other factors and that these differences may continue. The existence of these differences makes it desirable not to provide all
6308	COMMONS
Canada Student Loans Act of the needed increase through an across- the-board increase in all provincial allocations, which would result in an unrealistically high over-all loan provision, but to enable the rounding out of individual allocations on a discretionary basis at the request of the province concerned. I would envisage consulting with or informing the other provinces before implementing such a discretionary increase, in view of the close co-operation with provinces on the criteria being applied in the administration of this program.
Escalation of the new, higher basic loan provision from one year to the next would continue on the basis of the growth in the population 18-24 year age group. Similarly, the formula contained in the act for alternative payments to non-participating provinces would remain unaltered. Since this formula is based on payments actually made by the federal government to banks and other lenders in respect of loans made under the legislation, alternative payments will reflect the increase in the volume of lending under the act.
We believe these two changes in the total loan provision to be sufficient to accommodate the loan demand that may arise in any province on the basis of the agreed criteria during the current and subsequent loan years.
The bill contains one other provision which can perhaps be best described as a housekeeping item. The act authorizes the minister to pay interest on loans while the borrowers are full-time students and for a period of six months thereafter, and unintentionally precludes the minister from paying interest on loans in cases where students must for some reason interrupt their education for a period of more than six months, and who later again become full-time students. This is in conflict with the provision which states that loans are interest free to students during any period during which they are full-time students. The proposed amendments will rectify this situation.


John George Diefenbaker: Mr. Chairman, I should like to ask the minister a question in relation to students coming to Canada from other countries. I do not think there can be a general plan put into effect regarding the granting of loans to these students because there seems to be a dissimilarity in the application of the principles that are followed in various provinces, so far as the students are concerned. Will the minister indicate what is the rule in this regard?
[Mr. Sharp.)
DEBATES	June 13, 1966


Mitchell William Sharp: Mr. Chairman, I am a little
reluctant to give a definite answer to the hon. gentleman's question at this time. I agree that there are differences in the application of the rules from province to province, but I would prefer with the hon. gentleman's permission to give an answer when we have the bill before us for consideration at the committee stage.


Thomas Clement (Tommy) Douglas: May I ask one further question. Of the $58 million that is being proposed under the bill which will be placed before us, how much will be set aside and allocated to the provinces? Will there be approximately 80 per cent so allocated with 20 per cent left for ministerial discretion?


Mitchell William Sharp: I will answer later.


Mr. Orlikow:: Mr. Chairman, in rising to speak on this resolution I wish to make it clear that the members of this party will vote in favour of it, but will do so regretfully and indeed under protest because if there is one thing that is obvious about the student loans program it is that it is a far cry from the promises made repeatedly by the present Prime Minister during several election campaigns. This program does what so often is done in Canada: It helps those who need help the least. I am reminded of the old biblical saying, that to him that hath shall be given and from him who hath not shall be taken even that which he hath.
For years this party has proposed that the cost of university education should be carried by the state and that there should be no tuition fee, but that every person who has the ability to go to university should be able to go, regardless of his or his family's ability to pay. When the minister was introducing this resolution he said the same thing, or that the student loans plan was the beginning of that kind of a program. Nothing could be further from the truth; and all the evidence that has been found as a result of studies, and I will refer to some of them later, demonstrate conclusively that we are not, through this loans program or anything else which we have provided, meeting the needs of the children of low income families, whether they live in the cities or in rural areas.
[DOT] (4:00 p.m.)
The children of the low income families are not attending university in Canada in any appreciable numbers. In this connection, Mr. Chairman, I would remind the Minister of Finance, in case he has forgotten, that in the 1958 election campaign the present Prime
June 13, 1966

Minister promised that if elected his party would institute a program under which 2,500 scholarships and 7,500 bursaries would be provided every year for Canadian university students-not loans, but scholarships and bursaries. Then in the 1962 election campaign the present Prime Minister raised the ante with a promise to grant 10,000 scholarships, each worth $1,000, to students who wanted to attend university. It is a long time since we have heard anything about that promise of the Prime Minister. Instead we have this completely unsatisfactory student loans program.
What are the problems arising out of this program? I think they can be summarized very quickly. We believe that the welfare of this country, the rate at which this country will progress, is tied very closely to the kind of education we give to our young people. We believe that the whole university and technical school program in this country must be increased at a very substantial rate. We ought to recognize the fact that we are now in a period of crisis in higher education, that there are inadequate funds for university education and that until we solve that problem this country will continue to be in a period of crisis as far as higher education is concerned.
We are concerned about this. We are concerned about the financing of education. We believe that until this problem is solved the whole ability of this country to make the progress that is required will suffer. We believe that the cost of education must be met, not by the individual, not by the student and not by his parents but by the country as a whole, because the value to the country is a value to all its people. The value of increased and better education redounds to the benefit not only of the individuals concerned but to the country as a whole.
A number of careful studies have been made by universities, by departments of education, by the new manpower department, all of which indicate conclusively that there is a very substantial increase in the earning power of every person who attends university. We ought therefore to keep this in mind. It has been estimated that the person who attends university will earn, for every year he attended university, for the rest of his life an average of $1,000 a year more than if he had not attended university. The income tax alone that that person pays will more than repay the cost which the state, the people of Canada, invest in the education of those people who attend university.
Canada Student Loans Act
But the cost of attending university for a year is not just the cost of tuition, it is not just the cost of room and board-and that is very high for students who attend university in a city in which they do not live-it is not just the cost of books. There is the cost of lost earnings, and the cost of wages which are not earned while a student attends university. It has been estimated that the actual cost of attending university for a year is over $4,000. The estimate is based on living expenses of $1,000, tuition fees of $500 and $2,000 per year of lost earnings.
That being the case, it is obvious that a loans program in general is not the way to deal with this problem. Professor Seymour Harris, one of the most eminent American economists, has objected to this kind of student loans program for the following three reasons. First of all he says that people are not ready to purchase such an intangible asset on credit. Second, he says that the burden of debt will no doubt be discouraging to those who are the most needy already. Third, he says it is not certain that the Liberal scheme of loans will provide the educational opportunity which is claimed for them. The low tuition device has opened the door best to educational opportunity.
I suggest that the loans program-which has been successful, and the minister has indicated that something in the neighbourhood of
100,000	students have availed themselves of it in the two years since the program was commenced-helps those who need help the least, because it is the well-to-do who attend universities at the present time. Loans will make sure that this group will continue to attend university, while the children of people in the low income earning groups will not attend university. That is not surprising. It is not unusual in this day and age to have families in which there are two or three young people of university age who would like to attend university.
In connection with these young people $1,000 a year lent for four years means the incurring by the family of a debt in the neighbourhood of anything from $8,000 to $12,000, if they have two or three children. With interest this represents a debt in the neighbourhood of $15,000, because these loans have to be repaid at 6 per cent interest. The minister has done very well by the chartered banks of Canada. They will make money out of this program; you can be certain of that. Therefore it is not surprising that the children of parents in the low income brackets
6310	COMMONS
Canada Student Loans Act are simply not attending university as they have a right to do.
The Canadian Union of Students, an organization which represents all university students in Canada, commissioned a survey of the incomes of parents of students attending university at the present time. This survey was sent to all members of parliament. Arising out of that survey, every member of parliament was circulated by letter from the Canadian Union of Students, signed by Patricia Horrobin, their associate secretary. I wish to quote a question which Miss Horrobin put to members of Parliament and to which I think the minister ought to give considerable thought. In the letter dated March 28, 1966, she asks the following question:
How long will 6 per cent of Canada's population, those who annually earn In excess of $10,000, send 25 per cent of all undergraduates to the 46 predominantly English speaking universities and colleges surveyed by the Canadian Union of Students? And how long will 52 per cent of the population, those who annually earn less than $5,000, provide only a matching 25 per cent of the undergraduate population?
[DOT] (4:10 p.m.)
That question has not been answered and it is not answered by the student loans program. I submit, Mr. Chairman, that rather than solve the problem, the student loans program as proposed will worsen the situation of the Canadian Union of Students. The survey which this union has commissioned demonstrates conclusively that what I said is true and that the young people coming from rural and urban families which are in the low income bracket will simply not go to universities. After all, more than two-thirds of the farmers of Canada are in the low income bracket.


Mr. Basford:: Will the hon. member permit a question? Is he aware of the fact that the survey from which he is quoting is an analysis of the income level of the families which send their children to the universities, and that this survey was financially supported by the government in order to find out the nature of the student population?


David Orlikow: Mr. Chairman, I accept the hon. member's statement as true and I can only say that I wish the government paid some attention to the results of that survey, because it demonstrates conclusively that the students who presently attend universities come mainly from the families in the middle and upper income levels in Canada. I submit

DEBATES	June 13. 1966
that the students loan program will not only continue the situation but will aggravate it.
What good is it for the government to help finance such a survey if it is going to ignore its results? According to the survey, less than one-quarter of the Canadian population sends nearly half of all students to the 47 Canadian universities and colleges surveyed in February of 1965. Another two-thirds of the Canadian population, 64.1 per cent of the blue collar or working class status, in turn account for a little over a third of the university students, or 35 per cent. I submit that this is wrong and completely immoral. I suggest that instead of putting forward the student loans program the government should have introduced the very simple and practical program which the Prime Minister has proposed in his election campaigns, namely a program of
10,000	scholarships each worth $1,000. This program would help the young people who need most assistance.
The survey of which I have spoken indicates very clearly that by and large Canadian students do not represent the Canadian class structure but only the middle and upper income classes in Canadian society. An annual salary exceeding $10,000 is earned by 6.1 per cent of Canadian families, which provide 25 per cent of all university and college students in the surveyed institutions. I submit this situation is indefensible.
Families which earn annually less than $5,000, or 52 per cent of the Canadian population, provide slightly over 28 per cent of the students. Families earning less than $3,000 annually, or 22.1 per cent, provide only 9 per cent of the university population. The student loans program has done nothing and will do nothing to overcome these tremendous deficiencies.
Nearly one-fifth of all the students come from families in which the father is a university graduate, although only 5 per cent of Canadian heads of families graduated from the university-in other words four times the national population average. The student loans program will continue this terrible disparity. It will do nothing to make university education representative of the Canadian population as a whole.
The people who are most poorly represented in Canadian universities at the present time are the youngsters who come from rural homes. They do not get to university in appreciable numbers, or in any number comparable to their percentage of the total population. This has been the situation ever since universities began to function in Canada.
June 13. 1966	COMMONS DEBATES	6311
We have proposed that university education should be freely granted to every person who has the ability to attend. I suppose that this is too much to expect from the government and from Canadian society, which has always given to those who ask. I suggest that the time is long past when we could at least have expected that the very minimal proposals made by the government would have been implemented. I am referring to the proposals for scholarships made by the Prime Minister. Instead of that we are asked today to increase the amount of money available for students at the university level.
I said at the beginning and I say in closing that we will not vote against this resolution because this program is better than nothing at all. However it is a far cry from what the government has proposed and has promised to the people of Canada. I suggest to the Minister of Finance that if the government were to bring in the kind of legislation which has been promised so often, it would be passed in this house in time to be made available to students for the forthcoming university year. However, we have been told again and again that the government has no intention of proceeding with the kind of proposal made by the Prime Minister as long as eight years ago.
That being the case, as I said earlier we will vote for this resolution but we will only do so under protest and with the greatest of regret.


Mr. Gauthier:: Mr. Chairman, just a few words about this resolution to tell the house that our group has, of course, nothing against it, as it will be followed by a bill to increase allocations for student loans.
But, as the hon. member who spoke before me said, and we agree somewhat or rather a lot with what he said on this matter, this again is mere patchwork following the numerous promises made by the Liberal government at each election across Canada, to the effect that scholarships would be granted. As a matter of fact, at one election, they will promise 20, 25 thousand scholarships; at the next, they will lower the number somewhat; at the following election, the number is practically nil. And finally when the time is ripe for action, there are none at all, or they are transformed into loans. When one sees, Mr. Chairman, how those loans are distributed, well, I will tell you frankly that in rural
Canada Student Loans Act circles, like my own constituency, nothing much is expected as far as those loans are concerned. Sons of doctors, sons of professional men are served first, and if there are any left-overs they go to farmers' sons, settlers' sons.
Furthermore, the service is rather poor because last year, I received many letters from farmers' sons and settlers' sons of my riding saying they could not obtain a loan because there was no more money available.
They start by selecting the university and the student. I saw for myself how it was done when I went to the university with my children. Just think, I, the son of a settler, dared enter the university.
Today, the situation is practically the same. As a matter of fact, when I went to register one of my daughters, the rector told me that they had received 260 applications and had room for 80 students only. Just think of that: 260 young people anxious to take a classical course to reach their ideal and specialize in a given science find themselves unable to get access to the university.
I asked the rector: What are you doing to do with the others? He replied: They will have to try their luck somewhere else.
Imagine the disappointment of those young people. We are wondering today why the young are rebels. They have good reasons to be.
Imagine the disappointment of the young who have sacrificed four, five or six years of their lives to get where they are now and who cannot get in because there is not enough room.
Imagine that in Canada, in the province of Quebec in particular, there are not enough classrooms, not enough room. That is a big joke. There is enough room but the university trust is to blame. Beware: There must not be too many doctors or lawyers in Quebec. It is the trust at work. I have known it since I was a child and it is still the main thing today.
The door is literally closed to real talent and very second-rate students are accepted simply because they were born in a certain class of society.
I want to say those things in the house to show that the people are not as stupid as one might think and that they see what is going on. One had a striking proof of that in Quebec and you will have another one at the next elections, gentlemen of the party in office. The people are watching you. You can
6312	COMMONS
Canada Student Loans Act no longer make empty promises as you did 25, 30 or 35 years ago when means ol communication were lacking.
Today, the people know what is going on in the afternoon; they know it the same night thanks to television and the radio. The people are watching you; they are more intelligent than you think and they will judge you as they judged the unkept promises as we have just seen in Quebec.
It is a warning. It is often said that a good warning is helpful. I wish to say to the government that after all its promises, it is smothering us with debts. The government is only a negotiating agent working to put the whole population into debt.
It is involving our young people in debt for years to come. In whose favour, once again? Chartered banks. Those are the ones which, after controlling us all our lives, will still control our growing children.
It is the government which authorizes chartered banks to make those loans, thus putting a noose round our students' necks.
Well, Mr. Chairman, since nothing else can be expected from such puppet governments, this must be accepted. Until the people are strong enough to teach a lesson to the federal government, we shall vote for the resolution, but we shall certainly have something to say when the bill is introduced.
[DOT] (4:20 p.m.)
[Englishl


Mr. Patterson:: Mr. Chairman, I just want to Say a few words this afternoon in support of the resolution now before the committee. I listened with a great deal of interest to the statement made by the minister, but I had difficulty in following it sufficiently well to make' too many comments today. However we will all read it very closely to And out exactly what is proposed. Of course when the bill itself is before us we will have a clearer understanding of the whole legislation.
The minister did indicate that the provisions which were made initially were very widely taken advantage of, in fact to the extent that the allocations in the first year were not sufficient to meet the need, necessitating the provision of additional amounts. We all recognize, Mr. Chairman, that the financing of education at all levels is a major and growing problem. I do not think there is any disagreement with the idea that provision must be made in some way for all young people to obtain the best possible education, commensurate with their wishes and capabilities.	' -
IMr. Gauthier.]
DEBATES	June 13, 1366
There is, Mr. Chairman, a great deal of disagreement as to just how this can best be accomplished. The suggestion has been made that as far as higher education is concerned we should engage in a program of free education, eliminating tuition fees and so on. Then there are others who have been very active in the educational field, as well as many of the young people themselves, who disagree with this particular proposal.
Therefore, Mr. Chairman, while there is general agreement that the problem must be resolved and provision made for our young people to achieve the highest possible degree of education, yet there is not unanimous consent or opinion on how this can be brought about. I just rise at this time, Mr. Chairman, as I say to support this proposal, and we will study the bill very closely when it is brought before the house.


Stanley Ronald Basford: Mr. Chairman, I just want to say a few words on the resolution about some of the housekeeping measures which the minister said he would be introducing in the bill.
I listened with great interest to the hon. member for Winnipeg North who, as is the wont of members of his party, indulged in a partisan, political diatribe on the subject of education. If he were so immensely interested in higher education I just wished he would have read the open letter which the law students of The University of British Columbia addressed to every member of the house, in which they said that they were fed up with the members of this house engaging in partisan politics, and wanted them to get on with the business of the country.
Therefore, Mr. Chairman, rather than answer the hon. member for Winnipeg North I would simply say that the government-and I hope he is aware of this-have planned for the coming week end a conference with the provinces to deal with the very subjects which he raised.
I want to say a few words with regard to some representations which have been made to the government over the last three years by CUSO-Canadian University Services Overseas which also have reference to The Company of Young Canadians, the legislation relating to which was before the house last week and is coming up again later this week.
[DOT] (4:30 p.m.)
Under the present legislation, students who have borrowed under the Canada student loans program must commence paying interest and principal seven months after graduation. This situation has created and is creating
June 13. 1966	COMMONS DEBATES	6313
great difficulties for those students who become volunteers either overseas for CUSO, or who will become volunteers for The Company of Young Canadians in Canada.
I know a number of CUSO students who worked hard in my campaign. I know them well. I get letters from them, from India, and they are having difficulty making payments on their student loans. That is because in India they are being paid a subsistence allowance, or are receiving the indigent salaries that they would receive in India. It is hard, under these circumstances, for a student to try to pay back $5,000 worth of loans after graduation. We want surely to encourage young people to take part in the work of CUSO and in the work of The Company of Young Canadians. If, while undertaking voluntary services with these organizations, they have to consider repaying their student loans, they might be actively discouraged from volunteering.
Officials of CUSO have told me that in order to get volunteers they have often had to assure prospective volunteers that arrangements would be made for them to pay their loans. Of course I know of other cases where the parents have taken over the repayment of principal and interest. Nevertheless I hope the minister will gove some thought to granting these volunteers special exemptions from the repayment of principal and interest during the period they are volunteers.
I know that in general legislation it is always very difficult to define exceptions and make exemptions for different and special classes of people, although where there has been a will to do something we have found the way to do it. As an example, we have in the Income Tax Act a method by which we can exempt contributions to certain organizations, which contributions are tax deductible.
I think that under the Canada student loans program it ought to be possible to make regulations exempting the volunteers for CUSO and The Company of Young Canadians with respect to the repayment of principal and interest while they are serving overseas or in Canada as volunteers. I think it would be simple to amend section 11 of the regulations, and sections 4 and 5, which require repayment to begin within seven months. It seems to me that it would be easy to change the regulations allowing the Minister of Finance or the governor in council, as the case may be, to exempt students who undertake such work is as envisaged in CUSO or in The Company of Young Canadians. I think that for
Canada Student Loans Act students to begin repayments of principal and interest seven months after graduation works a real hardship on them, especially when they are being of real service to their country and to their world, by working as volunteers. Thank you, Mr. Chairman.


Mrs. Maclnnis (Vancouver-Kingsway):: Mr. Chairman, I think that the amendments to this act are very important. The question of education concerns us all because we realize today that higher education is the key to modern living, to being able to get a modern and interesting job, to a modern income, to having an opportunity for a modern standard of living, with all that that means by way of travel, culture, and everything else that goes with it.
I cannot discuss this bill without in the first place making the same general criticism that was voiced by my colleague, the hon. member for Winnipeg North. I believe it is our duty as part of the opposition in this house to voice general criticism of the underlying principle of certain measures and to put forward alternatives. In a moment I shall indicate that this is not a waste of time because the suggestions voiced as alternatives today become the policies of tomorrow. That is why, before criticizing the bill in detail, I must say that the whole student loans program is today outmoded and mistaken in its concept of how this problem ought to be handled. The reason is that it does not begin to cover opportunity for anything like all the bright minds in the community.
My colleague from Winnipeg North has pointed out that we are taking the tax funds of the whole country and making it possible for those who are not quite in a position, but on the edge of being able to attend university, to obtain a university education:
The program does not touch on the much greater needs of those people who have no chance at all of going to university. This idea is summarized very briefly in an article in the Maritime Co-Operator of April 15 of this year which was reprinted in many publications across Canada, including the Western Canadian Lumber Worker. It says:
Further proof of the fact that university education is beyond the aspirations of students from low income families is found in part I of a study of student means made by the Canadian Union of Students, and released on March 15. It points out that over 25 per cent of the average student's budget goes to pay tuition fees. How many of them feel able to afford it can be gathered from the following statistics.
22.1 per cent of Canadian families earn less than $3,000 a year but their children make up only 9 per cent of our university population.
June 13* 1966

Canada Student Loans Act
32 per cent earn between $3,000 and $5,000 a year, but their children account tor only 19 per cent oi our student population.
32.4	per cent earn between $5,000 and $8,000 a year and their children account for 30 per cent of our university population.
7.4	per cent earn between $8,000 and $10,000 a year, and their children account for 12 per cent of our university population.
6.1 per cent earn over $10,000 a year, and their children account for 25 per cent of our university population.
Compare the top and bottom statistics. Only 9 per cent of the university student population comes from almost one-quarter of our Canadian families, those earning less than $3,000 a year. Thirty-seven per cent of our college students come from the numerically few affluent families with incomes of $8,000 and over. Let us not worry that easier access to university education will weaken the characters of low-income students until it can be proved that the performance of those who now go through college without financial strain is generally inferior to those who must make it the hard way. Availability of money and the lack of it, in our view, is often the big difference between the incentive and the lack of it.
I want to point out that the student loans plan, as shown by the figures the minister gave us, is not only welcome by those students who benefit from it, but is terribly necessary. The oversubscribing of the plan indicates how great is the void which the plan has not yet been able to fill.
We are proposing in this party that the fees in university, and for that matter in vocational and technical colleges should be abandoned altogether. We are proposing that students in low income groups who have a capacity to profit by university education should be helped as a result of all students getting their education free.
[DOT] (4:40 p.m.)
I was interested to hear a fellow member from the city of Vancouver refer to what was said on this subject by my hon. friend from Winnipeg North as being a partisan political diatribe. Well, if it was a partisan political diatribe it has been taken up on the other side of the house, as can be seen from the Montreal Star of May 21 which contains the following headline:	"MacEachen Forecasts
Action on University Fee Abolition". I wish to read part of what the minister had to say.


Stanley Ronald Basford: On a question of privilege. I did not reflect on the argument for freer education, a policy which I support. If one were to examine my record in my own party there whould be no doubt about that. I was reflecting on the way in which the hon.
[Mrs. Maclnnis (Vancouver-Kingsway) .1
member for Winnipeg North put his statement. It was certainly a very partisan statement, and I think this is too important a subject for partisanship.


Winona Grace MacInnis: So
do I. And in that speech I did not hear any unparliamentary language, or a single unparliamentary word used. Let us see what the Minister of National Health and Welfare had to say on this subject.
The day is "not far off" when federal and provincial government officials will have to discuss with Canada's universities, the abolition of tuition fees, Health Minister MacEachen said last night.
This will be one of the steps to assure that every Canadian qualified for a university education will have the chance to get it, Mr. MacEachen said in a speech to the first graduating class of St. Lawrence College, founded in 1958.
The arguments against tuition-free university education may be the same ones "clothed in different language" that were used before free elementary education was introduced, the minister said.
Modern society demands increasingly that its members be either university trained or technically skilled, Mr. MacEachen said.
"This being so, can we continue providing free education in that segment of the educational system which only lays the basic foundation for a space-age career, while maintaining the financial barriers in the higher education levels from whch an increasingly greater percentage of our work force must come?
". . . the day is not far off when governments- provincial and federal-must sit down with the universities and seriously consider the outright abolition of tuition fees."
I hope the day is not, in fact, further away. I cannot forget that during the last two elections we were promised that the loans would be superseded by bursaries to help students along.
Now I turn to one of the most influential eastern newspapers, the Globe and Mail of February 22, of this year. This is from an editorial:
There are three sound arguments against student loans. Students from poorer homes-those who really need assistance-are often unwilling to take on four-figure debts. Students with large outstanding loans are often reluctant to undertake post-graduate study. And the burden of repayment can often impose intolerable economic hardship on a student launching a career.
Committed to the concept of free higher education, the Canadian Union of Students has at one time or another employed all of these arguments in the campaign to persuade the federal and provincial governments to scrap student loans in favour of free university tuition. But it has also, as it did last week, offered a fourth reason: that women are reluctant to take student loans because indebtedness is a deterrent to marriage, a "negative dowry".
June 13. 1966

No one will argue that two debtors can live as cheaply as one, but it is impossible to believe that a young man would be guided more by purse strings than heart strings in his choice of a wife. And if he was, what girl would want him anyhow?
Let me tell hon. members about some of the girls I met coming out of the University of British Columbia last fall. One of them said this about the student loan program: "I shall be graduating within a year or so and already I am $3,000 in debt with the federal government. I want to marry a boy who is starting on a very long course, and as soon as I graduate I want to be able to marry him and work while he continues his studies in the university. What kind of dowry is a debt of $3,000? Then, suppose I get pregnant when we marry. What position will my husband be in for the rest of his life, and what sort of wife would I make for him?" This was her plea for the abolition of the student loans system.
I do not like seeing those smiles on the other side of the house because a few years ago hon. gentlemen over there were in favour, not of loans, but of bursaries at the least. Some of them have even reached the stage of saying that free education is the only answer.
Let me read, now, a letter from a young man who graduated this year. He says:
Since there is little likelihood that tuition fees at university will be done away with in the near future, I wonder if any effort is being made to achieve better conditions for the student loan fund.
I hope the Minister of Finance has his ears open wide at this stage, because these are the comments of a young student who has finished his studies and is saddled with a load of debt. I am sorry. He has not finished his studies. He is going on. He writes:
By the time I am ready to leave university I will be close to $5,000 in debt. I'll probably be just married, need a car, as well as having a lot of other expenses. Yet at this same time the bank will want its money back at 6 per cent interest. It's not only an impossible situation; it's not conducive to married life or a new job in the least. Since no radical changes are likely to be made in the existing student loan fund, I wonder if a little pressure would get the interest charges deferred from six months after graduation to a more reasonable three or four years? It would cost quite a bit but not nearly as much as it would cost the student emotionally as well as financially.
I know it's a small matter but it's sure important to some of us.
Had the Minister of Finance been listening he would have heard a very good idea for improving the loans assistance this year. I hope he will take account of suggestions such
Canada Student Loans Act as this. When we have a cabinet minister who tells us that lack of education is the single largest cause of poverty, as one did not long ago, and if we are serious about the war on poverty, we should be trying to give intelligent men and women of this country the chance to get free education irrespective of where they may be located or the social situation in which they find themselves. A young student growing up in a family where there is no university background has two or three strikes against him in the first place. He needs whatever help he can get. It is not only a matter of education fees; he must also forego the earnings which those in lower income families usually have to make in order to help the family along.
I urge the minister to make things easier for students who are getting loans. I would also urge that this should be the last occasion on which we have a student loan proposal in front of us. I should like to see the hon. gentleman come to us next year with a real proposal for free education at university or technical level-a proposal geared to the atomic age as free public school education was fitted for the horse and buggy era.
Some nations are ambitious to be the first to put a man on the moon. I think we in Canada should be ambitious to be the first western nation to offer university education free of tuition fees, if there is a chance of getting ahead of the other countries in this particular race. It is a goal which is well worth the effort.
[DOT] (4:50 p.m.)


Mr. Deachman:: Mr. Chairman, I want to deal briefly with a table of figures which appears in the Bladen report on the financing of higher education in Canada, a report by a commission to the Association of Universities and Colleges of Canada, successor to the National Conference of Canadian Universities and Colleges, and its executive agency, the Canadian Universities Foundation. This report into the financing of higher education in Canada was published in 1965, and on page 30 is a table which should be of interest to us when we are considering the financing of higher university education.
This table, marked lx B, and headed, "Operating Income of Universities and Colleges," gives the percentage figures contributed to the operating costs of universities by fees, federal government contributions, provincial governments and others. This table, covering the decade 1954 to 1964, shows that the percentage contribution of fees has
June 13, 1966

Canada Student Loans Act changed almost not at all. In 1954 it was in the neighbourhood of 27 per cent, and at 1964 it still remained about 20 per cent of the operating income.
The percentage contribution of provincial governments began at the order of 40 per cent and remained at 40 per cent at the end of the decade. On the other hand, federal government contributions were of the order of 14 per cent to 15 per cent a decade ago and increased to 18 per cent and 19 per cent at the end of the ten year period, an increase of about 4 percentage points. Other contributions toward the operating income of universities from private individuals and private capital declined over the decade from 17 per cent to 14 per cent.
Let us examine what that means to us as a federal house when we are considering the voting of money toward assistance for students in universities. It means that the provincial governments have not changed the percentage contributions which they make to universities, and universities are provincial institutions. It means that the federal government has contributed more on a percentage basis, the addition being approximately equivalent to the amount by which private capital and private individuals have decreased their percentage contributions, thus helping to keep the fees percentage contribution steady.
In other words, federal money has tended to go into the treasuries of the provinces and not into the financing of higher education. Those of us who live close to universities know that when it comes time for a university to present its budget, usually it has to increase its annual budget to cope with the large and growing inflow of students. The university then has to go to the provincial government and each year ask for higher amounts.
The provincial government estimates what will be the size of the federal contribution, finds out whether the per capita grant has increased, whether the Canada Council is helping with the cost of capital construction and finally, when it has reckoned what the federal contribution will be, it says to the university, "We cannot grant you the budget you ask for expanding higher education in this province this year, and we are going to cut your budget back seriously." The provincial government puts on the squeeze, and the federal contribution tends to flow indirectly into the general revenues of the province
[Mr. Deachman.l
rather than into assistance to higher education.
When we as a federal house contemplate higher education and its assistance, when we are considering assistance to students by way of loans or by direct grant, scholarship or research, or when we are considering per capita grants or construction grants through the Canada Council or C.M.H.C., we must ask ourselves how we can work out a device to assist higher education, and which at the same time does not tend to subsidize the general revenues of the provinces.
This is a serious problem that faces a federal government when it spends dollars in the field of higher education. I do not really know what can be done about it, but at the undergraduate level we must move more and more toward assistance to the student, and at the postgraduate level we must move more towards programs of research, programs of higher scholarship-in other words, fellowships and doctorates-and toward the provision of research equipment, so that the end product of the research laboratories of universities and the scholars which they produce tend to benefit the nation.
By doing this at the postgraduate level we can produce a higher yield, and by doing it at the undergraduate level we shall assist the student rather than the university itself, which is a provincial institution. In this way, as time goes on we should be able to direct federal dollars to better purposes in the higher education of Canadians.
[DOT] (5:00 p.m.)


Mr. Knowles:: Mr. Chairman, I should just like to say a few words about this resolution to the effect that I believe we should have a definite statement from the government as to its intentions in respect of the question of the abolition of tuition fees at the university level. My reason for asking for a statement on this question arises from a speech to which reference has already been made by the hon. member for Vancouver-Kingsway. This was a speech made in Montreal on May 20 by the Minister of National Health and Welfare.
My colleague has already quoted the key sentences from that speech by the minister, which were to the effect that the time would soon be here when steps would have to be taken to abolish university tuition fees. Frankly the statement made by the Minister of National Health and Welfare was so clear and forthright I thought perhaps the government was heading, in the right direction.
June 13, 1966

Accordingly I asked the Prime Minister a question about this subject in the House of Commons on Tuesday, May 24, but it received the ten o'clock treatment.
On Tuesday, May 31, during the overtime period I restated my question and quoted the significant parts of the spech made by the Minister of National Health and Welfare. I remind the minister and the committee that that was a speech in which the minister came all out in favour of the abolition of university tuition fees. To my surprise the answer given to me on the night of May 31 by no less a person than the parliamentary secretary to the Prime Minister was to the effect that that distinguished gentleman did not know what the Minister of National Health and Welfare was talking about.
The reply made by the parliamentary secretary to the Prime Minister is to be found in Hansard at pages 5809 and 5810. He made some remarks about my question bewildering him because he did not think this was a matter that the federal government should get into at all. He made this statement:
The federal government cannot in any way legislate toward the abolition of fees.
At that point I interjected this question:
Then what did the minister mean?
I was referring, of course, to the Minister of National Health and Welfare. The parliamentary secretary to the Prime Minister replied:
I am asking myself, sir, what the minister meant.
As one continues to read what was said by the hon. member for Mount Royal it becomes clear that he had doubts as to whether the Minister of National Health and Welfare was expressing government policy. I put it to the Minister of Finance, was that just a kiteflying speech made by the Minister of National Health and Welfare, or does the Minister of Finance agree with the objective stated by that minister? Does he not also agree, in view of what has been said, that the house is entitled to a clear statement on the government's intentions in this field?


Mr. Ricard:: Mr. Chairman, I should like to put a couple of questions to the minister concerning the resolution before us.
First of all, it is a well known fact, Mr. Chairman, that the matter of education comes under exclusive provincial jurisdiction. I remember, when that measure was introduced last year, I believe, we had expressed
Canada Student Loans Act the viewpoint of the province of Quebec and had succeeded, I think, in having these views recognized.
I should like to ask the minister, considering that there has been since then a provincial election and a change of government in the province of Quebec, whether he discussed this matter with the new Quebec premier in order to ascertain his viewpoint? If not, does ha intend to get in touch with the new premier, in order to know whether the latter's views are the same as his predecessor's?
When he answers, will the minister tell me what he means by the last resolution which reads as follows:
And to provide also for a certain change in connection with the administration of the Act.
What does he mean exactly by those last words in the resolution?
[English1


Mr. Reid:: Mr. Chairman, I should like to make a few remarks, and make a request to the Minister of Finance. One of the things I was most interested in was the scholarships program which the federal government announced some time ago. I have been one of those concerned because it has not gone forward, though I recognize there are some groups who are opposed to it. The Canadian Union of Students would prefer a bursaries system, and probably the administrators of universities would prefer to use this money for their building programs and to offset the increasing costs of administration, and salaries of professors and teachers.
Perhaps when the bill is brought forward the Minister of Finance will give us some indication of the negotiations that have taken place between the federal government and the various provincial governments in respect of this program, and indicate the major obstacles in the way of its implementation. Perhaps the minister will also inform us as to whether the federal government has in fact changed its plan, and whether it has another program in mind instead of the scholarship program, since various pressure groups are opposed to it.
I should also like to refer to certain allegations I have heard to the effect that the student loans fund in the province of Ontario is being used by the province in a way which I think is at variance with the original purpose of the fund. To be more specific, it has come to my attention that before the province of Ontario will grant a student a bursary it requires the student to take out a loan
June 13, 1966

Canada Student Loans Act through the student loans fund of approximately $150. As I said before, I do not think that is in keeping with the original purpose of the fund. I would appreciate it if the minister would look into this situation and let us know at a later date whether in fact these allegations are true.
In reference to federal aid to higher education in general, I have noticed that in all the programs which have been brought forward very often the things the federal government wants are at variance with those that the provincial governments in their wisdom decide to go ahead with. Perhaps this is something that exists in all areas of federal-provincial co-operation. This is a problem which I think in respect of education is particularly acute. Probably I am being a bit idealistic, but I should like to see some sort of national program worked out through which aid could be given on an acceptable basis.
One of the problems attached to scholarship programs relates to the fact that there are just not enough university professors and facilities available to educate the number of people who ought to be educated at this level. It seems to me that instead of providing scholarships it might be more productive for the federal government instead to assist the provinces in their university building programs to provide for more facilities, and also assist in the area of providing higher salaries for university professors in order to attract more people into this profession.
[DOT] (5:10 p.m.)


Mitchell William Sharp: Mr. Chairman, some of the questions that were asked today can more appropriately be answered when the bill is before us, but perhaps I ought to deal with a few of the general observations that were made. The hon. member for Winnipeg North in his remarks was very critical, it seemed to me, of these student loans provisions. I believe that whatever deficiencies there may be in student loans, they nevertheless represent a tremendous step forward in the objective that the government has, as I said at the outset of my remarks, in ensuring that all those in Canada who have the scholastic qualifications and who want to get a college education or its vocational equivalent will not be prevented from doing so for financial reasons.
I would be the first to admit that this legislation by itself does not secure that objective; but I would certainly feel, and I am sure most people in this house would feel,
[Mr. Reid.l
that it represents a very, very great step forward. I can recall when I was a student at university myself, and had somehow to finance my education, that it would have been of tremendous value to me if I had been able to secure one of these loans; and I am sure there are many others in this house who were in the same position, who had to go through all sorts of special activities of one kind and another to finance a Bachelor's degree.


Stanley Howard Knowles: What were our fees in those days?


Mitchell William Sharp: It was not only the question of fees and it still does not remain only the question of fees. The fees in those days were very low indeed. In fact I recall winning a scholarship at the University of Manitoba in my third year. It was the magnificent sum, I think, of $120 and that was almost sufficient to pay my fees. Nevertheless I was not able to attend university without doing a little work on the side. It was not a question of fees that prevented me for some years from going to university; it was the inability to live without working.
I agree with some of those who have spoken today and pointed to the fact that these student loans, indeed all of the things that are being done today to assist in giving Canadian youth an opportunity of a higher education, are not sufficient to ensure that all of them do get a university education. As I said on a previous occasion, at ten o'clock in one of those end-of-the-day debates, the problem is very much deeper than that. Free university education in this country would not ensure that all promising Canadian youth able to take advantage of higher education would obtain it, because there are other obstacles that stand in the way of a full realization of our potential.
In this legislation we are extending the provisions of what has turned out to be a most useful scheme. The fact that it has been used so largely and that it is necessary for me to come before the house to ask for its extension and to enlarge the scale on which loans may be made is evidence of how useful a scheme it has been.
The hon. member for Winnipeg North Centre asked if I would clarify the government's attitude toward free university education. The government has not specifically considered this question, and for very good reasons. The problem of financing higher education in this country is not going to be solved,
June 13, 1966

even if the federal government were to provide the fees for all students who wish to go to university. The federal government has to consider its responsibilities in the field of assisting the universities to provide the facilities, the teachers, and so on. This is a problem at least as important at the moment as the question of fees themselves, and that lies largely within the sphere of provicial responsibility. So even if we were disposed to decide amongst ourselves what should be our attitude toward free university education, this is not a decision that we could make as a government.


Mr, Knowles:: Mr. Chairman, would the minister mind giving his interpretation of the speech that was made by the Minister of National Health and Welfare on this issue?


Mitchell William Sharp: As has been demonstrated so many times in this house, the Minister of National Health and Welfare is well able to explain his own statements. I usually find myself in agreement with what he has to say, but I am not going to attempt to-


Stanley Howard Knowles: But you don't agree with this one?


Mitchell William Sharp: -discuss what he may or may not have said. I did not hear it and he did not discuss it with me. I want to say however that I do not think anyone on this side of the house would take second place to any members in any other part of this house in our desire to further the cause of adequate educational opportunities for all Canadian youth. This is our objective. There are many ways of pursuing this goal and all these pursuits have to be in agreement with the provincial governments which, under our constitution have a special, if not a unique, responsibility for education.
The hon. member for Kenora-Rainy River asked me to comment on the recent arrangements made by the province of Ontario of co-ordinating student loans with their system of bursaries and other forms of student assistance. I think that in general these arrangements are not inconsistent with the legislation that is now under consideration. I believe it is quite appropriate that when any province is considering how it can best help students to obtain higher education it should take into account the loans that are available under the Canada student loans plan.
Bank of Canada Act
Some particular questions may arise on which we would want to differ, but in general these arrangements, so far as I understand them are sensible and do, I think, help to promote the general objective that we all have of seeing that those students who are prevented, for financial reasons, from getting a university education should be assisted. These are all the general comments I would like to make at this time, Mr. Chairman. When the legislation is before the house and in committee I can answer some of the more detailed questions that have been asked.
Resolution reported and concurred in.
Mr. Sharp thereupon moved for leave to introduce Bill No. C-197, to amend the Canada Student Loans Act. Motion agreed to and bill read the first time.
[DOT] (5:20 p.m.)



BANK OF CANADA ACT


Mitchell William Sharp: the second reading of Bill No. C-190, to amend the Bank of Canada Act.
He said: the present bill to amend the Bank of Canada Act is virtually identical to that presented to the house a year ago but which lapsed when the last session of parliament ended. Today I shall explain some of the major amendments that are contained in the bill. Some of these are very closely related to certain provisions in the bill to revise the Bank Act, which will be introduced very shortly, and it will therefore be necessary for me to indicate what we intend to propose in that regard. It is, of course, the intention to refer both the bill to amend the Bank of Canada Act and the new Bank Act to the standing committee of finance, trade and economic affairs so that members may have the opportunity to study all the proposed changes carefully.
One of the major changes that is proposed in the bill to amend the Bank of Canada Act is a new section which will clarify the relationship between the government of Canada and the Bank of Canada in regard to the responsibility for monetary policy. This section accomplishes two purposes. First, it makes clear there must be, as there is now, continuous consultation on monetary policy between the government and the bank. Second, it provides a formal procedure whereby, in the event of a disagreement between

June 13, 1966
Bank of Canada Act
the government and the bank which cannot be resolved, the government may, after further consultation has taken place, issue a directive to the bank as to the monetary policy that is to follow. Any such directive must be in writing, must be in specific terms, and must be applicable for a specified period. This new section requires that the directive be published forwith in the Canada Gazette and that it be tabled in parliament within fifteen days. Another proposed change that is closely related to this new section is the elimination of the power which the governor was given in the original act, but which has never been used, to veto any action or decision of the board of directors or of the executive committee of the bank.
Members will recognize that the objective of the proposed new section, which follows the recommendation of the Royal Commission on Banking and Finance, is to remove any doubt which may ever have existed about the responsibilities of the government and the bank for monetary policy. Under the proposed legislation it will not be possible for the government to deny its ultimate responsibility for the monetary policy which is followed, any more than it can in any other field of national policy.
A most important feature of the proposed amendment is that if the government exercises its right to insist on a charge in monetary policy, it will be required to do so openly, that is, in a way which brings the issue to the attention of parliament and the public. At the same time there is nothing in the proposed arrangements which in any way relieves the bank and the governor of their responsibilities for monetary policy and its execution. If the government of the day ever issued a directive to the governor of the day to execute a monetary policy which he felt was contrary to the public interest, it can be presumed that he would resign rather than accept such a responsibility.
I should like to stress that the intent of the proposed amendment is not to change the basis of the existing relationship between the government and the bank, which is based on these general principles and is working well in practice, but rather to give it clear legislative recognition. In this connection, it may be recalled that the present governor of the bank at the time of his appointment publicly expressed views regarding this matter of responsibility which are consistent with the principles proposed by the royal commission and embodied in the proposed amendment.
{Mr. Sharp.]
I should like now to refer to the changes which are being proposed in this bill, and that it is intended to propose in the bill to amend the Bank Act, in the cash and secondary reserve requirements of the chartered banks. At the present time the minimum average cash reserve requirement of the chartered banks is 8 per cent of the Canadian dollar deposit liabilities calculated on a daily average basis for each calendar month. Members will recall that in the Bank Act presented last year it was proposed to reduce the percentage from 8 per cent to 7 per cent gradually.
When the bill to amend the Bank Act is introduced shortly the intention is to contain an amendment which will set a minimum cash reserve requirement of 12 per cent against deposit liabilities payable on demand in Canadian dollars, plus a minimum requirement of 4 per cent of deposit liabilities payable after notice in Canadian dollars. On the basis of the present distribution of the deposit liabilities of the banks the over-all result of the new proposal would not differ greatly from the previous one since the over-all ratio, that is, the ratio of required cash reserves to total Canadian dollar deposits, would work out to about 6.6 per cent. However, the proposed change which accepts in principle a recommendation of the royal commission would place the banks in a position where they may compete with other financial institutions on more equal terms for savings and time deposits. Provision is made for a gradual shift to the new cash reserve basis. It is also intended to propose that the period over which daily cash reserves are averaged for the purpose of meeting the requirement should be reduced from one month to half a month. These particular proposals will be contained in the bill to amend the Bank Act.
That bill will also propose that the Bank of Canada be given a stand-by power, within certain limits and subject to certain notice requirements, to impose a minimum secondary reserve requirement, the secondary reserves to consist of notes of and deposits with the Bank of Canada in excess of the cash reserve requirement which I have just outlined, together with treasury bills and day-to-day loans. The present bill to amend the Bank of Canada Act gives the Bank of Canada the power to vary this secondary reserve requirement. Should the Bank of Canada find it necessary to invoke the power to impose and vary the secondary reserve requirement, the bank could not set the initial requirement at more than 6 per cent of
June 13, 1966

total Canadian dollar deposit liabilities and could not increase it by more than one per cent per month. In no case could the required ratio exceed 12 per cent. At the present time, by agreement with the Bank of Canada, the chartered banks maintain a secondary reserve of at least 7 per cent, in conjunction with the 8 per cent cash reserve. The stand-by power to impose and vary a minimum secondary reserve requirement would replace the present power of the Bank of Canada to vary the minimum cash ratio, which will be removed by this bill. It has proven in practice to be of little use and we think the variable secondary reserve would be more practical.
The proposed stand-by power would provide a means of impounding or releasing chartered bank liquidity, which in turn would have an influence on bank lending policies, and it would supplement the more usual technique of changing the amount of cash reserves available to the banks in relation to the minimum requirement. The raising or lowering of secondary reserve requirements can exert this influence with less impact on interest rates, a technique which could have important advantages in some instances, particularly those in which it might be necessary to have regard to the effect of changes in interest rates on capital flows into or out of Canada. This is not an unusual power for a central bank. The Bank of England has the power to call up special deposits, which is equivalent to raising secondary reserve requirements, and the Federal Reserve Board has the power to vary cash reserve requirements of commercial banks.
[DOT] (5:30 p.m.)
There are several sections which have been in the Bank of Canada Act since 1934 but which have long been inoperative. The Royal Commission on Banking and Finance recommended that these be removed and in this bill it is proposed to follow that recommendation. One of these sections covers the power of the Bank of Canada to act as banker or fiscal agent of the government of a province; this power has never been used and it would be difficult to exercise in a manner consistent with the bank's statutory responsibility in the field of monetary policy and as fiscal agent of the government of Canada.
Another such section is the one which requires the bank to maintain a reserve of gold and foreign exchange against its note and deposit liabilities and to redeem its notes in gold on demand. This section ceased to have any practical meaning after the bank's
Bank of Canada Act
holdings of gold and its holdings of foreign exchange, other than working balances, were transferred to the government's exchange fund in 1940.
In a related amendment it is proposed to remove the description "payable to bearer on demand" in respect of notes of the Bank of Canada. Since these notes are themselves legal tender under the terms of the Currency, Mint and Exchange Fund Act and have never in fact been convertible into gold, the present wording is archaic, unnecessary and I am sure as puzzling to the members of the house as it has been to me for years.
In accordance with recommendations of the Royal Commission on Banking and Finance the bill contains several provisions which affect the existing arrangements regarding directors and management of the Bank of Canada. Partners, officers or employees of firms of investment dealers which act as primary distributors of government of Canada securities would be added to the list of those ineligible for appointment to the bank's board of directors, on the ground that their business activities involve direct dealings with the central bank. The membership of the bank's executive committee would be enlarged by the appointment of an additional director, and the aggregate annual amount of directors' fees would be raised in order to permit more frequent meetings of the full board. It is also proposed that certain pension provisions relating to the governor and the deputy governor be made subject to the approval of the governor in council, as their appointment and salary now are.
Hon. members might find it helpful if I were to draw their attention to the one change that has been made in this bill from the version that was presented a year ago, and that is a minor provision that lengthens from 14 days to 21 days the period that may elapse between the date on which the minister receives the annual accounts of the bank and the governor's annual report, and the date on which these documents must be tabled in parliament. The sole purpose of this change is to allow adequate time for translation and printing.
There is one other provision relating to the Bank of Canada which it is intended to propose in the new Bank Act which I should mention at this time. This would give the Bank of Canada power to require information from the chartered banks provided that the banks shall not be required to furnish information with respect to the accounts of an individual customer. This section is included

June 13, 1966
Bank of Canada Act
in the Bank Act simply because that act includes all other provisions dealing with bank returns.
Provisions of the bill to amend the Bank of Canada Act which I have not touched on involve a number of relatively minor technical matters. Hon. members will have the opportunity of considering them in detail in committee along with the matters that I have mentioned today.
While we are on the subject of the Bank of Canada, Mr. Speaker, I would like to say a few words about the way in which monetary policy has developed in recent years. It has been, I believe, consistently directed toward the encouragement of sustained economic growth, while at the same time taking full account of the need to maintain a sound external financial position. Although the central bank has had to contend with some special factors arising out of our own balance of payments problems and those of the United States, as well as a difficult situation last summer following the default of a major finance company, I believe the basic monetary policy followed has been clearly apparent. So long as the economy was operating under a general condition in which unused resources were available to be drawn into production, monetary policy allowed growing demands for credit to be met without any tightening of credit conditions.
Over the past year or so, however, as the amount of slack in the economy decreased and as we drew closer to the limits of our productive capacity, which fortunately is growing, it became necessary to permit rising demands for credit to have an impact on credit conditions. I recognize that in some areas of the country a certain amount of slack remains, and that these situations continue to require attention, but taking the economy as a whole there has for some time been little capacity to spare. This situation has been reflected in low unemployment rates, rapid growth of employment, shortages of many kinds of skilled workers, rising prices and costs and a high level of imports. In these circumstances, it would not be in the public interest to encourage generally easy credit conditions. At a time when the economy is operating close to its physical limits easy money could only put additional upward pressure on prices and costs.
The fact that credit is now somewhat more difficult to obtain and interest rates are higher is therefore a reflection of the high level of

economic activity and prosperity in this country. The upward adjustment of interest rates has not been a development limited to Canada; they have followed a similar trend in the United States. Indeed there has been a general rise in interest rates throughout the western world, which reflects the high level of economic activity in most countries and the widespread demand for capital.
I believe that it is essential that we follow policies that are designed to moderate inflationary pressures and thereby improve our opportunity for sustained growth. I believe, however, that monetary policy should not have to carry a disproportionate share of this burden, and in fact it could not do so successfully. The measures announced in the budget, in combination with monetary policy and the other economic policies of this government, will provide a mix of policies which, in the opinion of the government, is appropriate to our present economic circumstances and prospects.


John George Diefenbaker: Mr. Speaker, in view of the fact that this legislation will be submitted to a committee I am not going to do more than make two or three observations. The first has to do with the concluding paragraph of the speech to which the house has just listened, wherein the minister revealed one fact that I think needs to be emphasized, namely that almost without exception in the western world there is taking place today expansion and developments that could not have been anticipated even 10 years ago. When so much is made from time to time of our economic expansion in Canada, it is always well to remember that that expansion began six years ago, and not with the incoming of the present government.
In the United States today the developments taking place are tremendous. Unemployment has been at its lowest level in a period of 12 years. Nevertheless certain trends do demand attention. In the last few weeks there has been an increase in the amount of unemployment in the United States which cannot but affect the Canadian economy in the long run.
I should like very much to hear from the minister as to his views regarding the high interest rates of today in parts of our country which are paralysing the development of the economy. In the course of his remarks the minister mentioned there are some portions of Canada that are not reacting to the general
June 13, 1966



expansion of the economy. I think this demands that action of a regional nature should be taken to protect and preserve the general level of economic advancement, instead of restricting it to certain parts of Canada and denying it to other areas.
I also want to make reference to the general suggestion that the monetary policy that is being followed is one that is similar to that in other countries. There can be no justification today for a tight money policy. The minister says that the purpose of the policy is to meet inflationary pressures. The manner in which those inflationary pressures are being met is indicated by the fact that the cost of living in Canada in the last year has increased at a rate which indicates a serious inflationary trend. Tight money today strikes at the vitals of the preservation of smaller business in Canada. Large business secures the necessary funds; but small business is being interfered with unfairly and unjustly. Some action must be taken by the government to assure that small business, which is basic to the Canadian economy, shall not detrimentally suffer, as is the case in ever-increasing measure. Indeed in every part of this nation complaints are received from small business men to the effect that their developments are being held back because of policies which cause an unnecessarily high interest rate to rest upon them. Indeed to a large extent their borrowing sources have dried up.
[DOT] (5:40 p.m.)
The Bank of Canada Act continues to be a monument to the foresight of Right Hon. R. B. Bennett. We too often forget that many of the outstanding institutions in our country came into being during that period of office between 1930 and 1935, when he was in office. I am not going to mention the others, but the Bank of Canada is one of them, as is the Canadian Broadcasting Corporation.
The Bank of Canada, during the period when I was in office, had difficulties when Mr. James Coyne was governor. He had the idea that whenever he felt like it he could go out and deliver speeches which had a provocative, if not political, object in mind. He seemed to regard his position as that of a ministering angel whose words were infallible, and whose views were unchallengeable. Many who today sit opposite took strong objection to the stand taken by the government of that day, and in particular by the hon. member for Victoria-Carleton (Mr. Flemming), for expressing the view that a
Bank of Canada Act
government is responsible and that the final say shall not be with a governor of the bank.
We find that what was criticized so severely by the Liberal party when in opposition is now to be adopted as a principle under law. This indicates that while reformation is sometimes delayed, none the less it ultimately is brought about. What was criticized is now advanced by the minister as a basic principle in the amendments projected-


Mitchell William Sharp: Mr. Speaker,-


John George Diefenbaker: -during my period of office.


Mitchell William Sharp: -would the right hon. gentleman permit a question.


John George Diefenbaker: I want to pursue my argument. I sat and listened to the minister as he read, and I followed his argument. I ask him to maintain that standard of silence he so frequently asks for on the part of others.


Mitchell William Sharp: I never do.


John George Diefenbaker: Mr. Speaker, we appointed during our period of office as governor Mr. Louis Rasminsky, who should have been appointed as governor by the St. Laurent government. He was the man who had the knowledge and the wisdom necessary to fill this position. One of the reasons why he was not appointed before was generally rumoured to have been the fact that his religious faith might not be conducive-


Some hon. Members:: Shame.


John George Diefenbaker: -to the holding of that position.


An hon. Member:: You started that one.


John George Diefenbaker: Who has interrupted?


Mr. Byrne:: You started that one.


John George Diefenbaker: After all, the hon. gentleman always speaks without knowledge, and generally with ignorance.


James Allen (Jim) Byrne: Much like yourself.


Some hon. Members:: Oh, oh.


John George Diefenbaker: I say unequivocally that that was one of the reasons advanced for the failure to appoint this man. He has turned out to be a governor of unusual ability.


Some hon. Members:: Hear, hear.


John George Diefenbaker: And I say without fear of contradiction that his appointment as governor provided a new era for the Bank of Canada. I am not saying he was the only one. Graham Towers was a man of unusual ability, and there was not difficulty while he occupied the position of governor.
Today the government has finally determined to place in the law a directive which generally is as follows:
The minister and the governor shall consult regularly on monetary policy and on its relation to general economic policy.
That was the course that was followed during my administration. However, it became effective when Mr. Rasminsky became governor. At no time was there over anything serious disagreement. He always understood the operation of the Bank of Canada and realized that there must be continuing consultation. Then, after the consultations have taken place, if there is a difference of opinion between the minister and the bank concerning monetary policy, the minister may, with the approval of the governor in council, give a written directive concerning monetary policy.
I think that that is a purposeful section, and one that is necessary. Indeed, on the basis of the experience that we had in office I only wish the section in question had been in effect. It is a forward step. It is one that recognizes the responsibilities of government as well as the independence of the Bank of Canada. And I say to the minister this, that in this amendment a direction is being taken which is based not on novelty or experiment, but rather on the general concept of carrying into effect banking policy.
I would have hoped at the same time that this legislation is before the house that the Bank Act amendment would have been ready. Apparently, if the voice of rumour is again well founded, tremendous disputations are taking place within the ranks of the Liberal party. I asked the minister the other day to let the house and country know the degree to which he accepted or was in agreement with the monetary philosophy of the hon. member for Davenport (Mr. Gordon). The minister brushed that aside and said I was trying to stir up trouble in the Liberal party. The Liberal party needs no help in that regard.
[DOT] (5:50 p.m.)
It has found that, with the hon. member for Davenport going about the country, and

June 13, 1966
Bank of Canada Act with the publication of his book, divisions and schisms have taken place which have not yet been resolved. Apparently one of the reasons for the delay in the measure amending the Bank Act is that there is no real agreement within the ranks of the government, and much disagreement among the members supporting the government. I would have hoped they would have been able to resolve these fissures and bring in the legislation. We would like to see it. There have been suggestions that the interest rate is to be increased. On the other hand there have been suggestions that the interest rate is only to be increased on larger loans. Well, that type of diplomatic subterfuge will simply result in the small borrowers not being able to borrow, and the large borrowers having a wide open opportunity to secure the funds they need. Again this will mean that the small businessman in Canada will find himself caught by the increased rates of interest, which will make money still tighter.
I hope that when the government brings in this measure and when, in the fulness of time, agreement has been secured among the members of the government and those supporting the government, legislation will be produced which will bring about a condition of fairness and equity between the powerful and the small businessmen, and that all parts of our country will be regionally equal in opportunity.
I trust that when this bill goes before the committee it will be considered in detail, and I again express the hope that some time soon the government will be able to produce the amendments to the Bank Act which we were promised a year ago and which are still in cold storage. Let us have them. Let us have the whole picture. I am sure that when this has been achieved the divisions which now exist within the government will have been resolved and, having passed through the travail of uncertainty, that the minister may be able to speak with an authority which as yet he has not possessed or exercised.


David Lewis: I do not
propose to deal with all the various measures in this bill, but only with one at any tength, and even that not at great length. I want to suggest to the house and to the Minister that the provision he is now proposing for achieving greater governmental authority in the monetary operations of the Bank of Canada may not be adequate.
I do not propose to deal with the matter of secondary reserves, which is a technical
June 13, 1966

device, and discuss for example how much better it is than the previous authority to change the primary reserve in the Bank of Canada. Frankly I do not know. In any case we can find out a great deal about this when the bill is in committee.
1 was glad to note the removal from the Bank of Canada Act of the archaic reference to gold. It was about time. I wish merely, before we call it six o'clock, to say to the minister that again and again in these economic discussions we in this party have had to point out the obvious inadequacy and frequent unfairness of the indirect type of control which is now exercised.
In the final part of his remarks on the bill the minister himself admitted, in effect, that there has been and is now a tight money policy. He called it "not an easy money policy"; I assume he meant a tight money policy but could not bring himself to say so. He went on to say this was influence by the fact that there were some inflationary pressures. I will point out again to him, as some of us have done over the years, that this is precisely why we have grave doubts about the efficacy of this kind of indirect control.
When you deal with the monetary system by means of interest rates, and try to counteract inflationary pressures by increasing interest rates; when you deal with the need to encourage or limit investment by global totals of currency in effect at any given time, the result is a policy which is indiscriminate in effect, and therefore discriminatory.
This is always the case if you raise interest rates and contract the money supply, as is now the case in Canada. Everybody feels the effect of the higher rates and of the contracted money supply-the big corporations who can, perhaps, overcome it, as well as the smaller borrower who cannot overcome it. This is precisely what has been wrong with the application of economic theories which do not have the courage to handle the economy directly. The minister himself admitted this. I am not quoting him, but I am sure that this is an accurate summary: He said there were some areas in the country where there was still some slack in the use of our capacity to produce. The fact is that his monetary policy, the higher interest rates and the restrictive money supply, affects those areas where there is slack in the use of our productive machinery, just as it affects other areas where the burden can perhaps be borne with greater ease. This has always been a basic fault or
Canada Elections Act
flaw in this field of monetary or economic policy.
I thought I would say those general words before dealing quite critically with the inadequacy, in my view, of the proposals to place the government in control of monetary policy as exercised by the Bank of Canada.
May I call it six o'clock?



PROCEEDINGS ON ADJOURNMENT MOTION


Mr. Deputy Speaker:: It being six o'clock it is my duty pursuant to standing order 39A, to inform the house that the questions to be raised at ten o'clock this day are as follows: The hon. member for Kootenay West (Mr. Herridge), administration of justice-inability to recover costs in Supreme Court action; the hon. member for Vancouver-Burrard (Mr. Basford), Sports-hockey-possible contravention of combines legislation; the hon. member for Lethbridge (Mr. Gundlock), Agriculture- Charolais cattle-request for permission to export.
It being six o'clock the house will now proceed with consideration of private members business as listed on today's order paper, namely notices of motion.
[DOT] (6:00 p.m.)



CANADA ELECTIONS ACT


[Stage Direction]
On the order: Private Members' Notices of Motions:
That the Standing Committee on Privileges and Elections be empowered to consider the advisability of amending the Canada Elections Act in order to provide:
(1)	that persons confined to hospitals be allowed to exercise their franchise in federal elections;
(2)	that portable polls be provided for public hospitals;
(3)	that transfers be allowed up to and including election day for persons confined to hospital;
and, for such purposes, to recommend such amendments to the said Act as may be deemed advisable.
Mr. Jim McNuliy (Lincoln):: Mr. Speaker, could I have the unanimous consent of the house to stand motion No. 21? This happens to be one of six motions that the government wants to send to a committee, but we are waiting for a report from the Chief Electoral Officer before this one is sent to a committee.

June 13, 1966
The Senate


Mr. Deputy Speaker:: Does the house give unanimous consent for this motion to stand and retain its precedence on the order paper?


Some hon. Members:: Agreed.
Motion stands.



THE SENATE


Mr. Bert Leboe (Cariboo) moved:: That, in the opinion of this house, the government should give consideration to the setting up of ten provincial commissions, consisting of representatives appointed by each province and an appointment or appointments by the federal government, for the purpose of making appointments to the Senate of Canada.
He said: Mr. Speaker, I shall speak for only a few minutes in order to allow the maximum number of hon. members to participate, so that we may get as much of the opinion of the house on this motion as is feasible. Discussion of such a motion is not something new, and in dealing with it I shall refer to excerpts from Hansard to show the importance that was attributed to it by hon. members on previous occasions.
Much discussion has taken place in the past concerning the method of appointments to the Senate. The electorate of the country has exerted pressure to have changes made in the manner of making appointments-even going as far as the hon. member for Winnipeg North Centre (Mr. Knowles) would go, in seeking the complete abolition of that part of parliament. I sincerely believe that the other place has contributed and does contribute a great deal to the welfare of Canada and to the general benefit of Canadians.
I do not believe it should be abolished, but in this connection I would like to refer to the importance placed on this matter by the official opposition some years ago, when I first entered parliament. The importance of it was emphasized by amendments moved to motions to go into supply. At page 5245 of the 1954 Hansard, Mr. Drew, the then leader of the opposition moved:
That all the words after "that" to the end of the question be deleted and the following substituted therefor:
"the government should give consideration to initiating the necessary consultation and inquiry respecting reform of the Senate so that all appropriate steps may be taken, including such matters as the method by which the members of the Senate should be chosen and their tenure of office, so that the Senate may more effectively discharge the constitutional function it was intended to serve as an integral part of our parliamentary system.

At page 5335 of Hansard for 1955 Mr. Rowe moved a similar amendment:
The government should give consideration to initiating the necessary consultation and inquiry respecting reform of the Senate so that all appropriate steps may be taken, including such matters as the method by which the members of the Senate should be chosen and their tenure of office, so that the Senate may more effectively discharge the constitutional function it was intended to serve as an integral part of our parliamentary system.
The present Premier of Saskatchewan, Mr. Thatcher, had this to say on the matter, as recorded at page 5338 of Hansard for 1955:
I am not going to take the time of the house to go into the weaknesses of the Senate. They can be summed up very briefly. Members are appointed rather than elected; appointments appear to have been made as a reward for past political services instead of any particular ability.
The late former minister of finance in the Conservative government, Mr. Nowlan, had this to say as recorded at page 5254 of Hansard for 1954:
The Prime Minister is also the leader of the government of this country, and a man whom we all respect although we may disagree with him on many of the policies that he advocates from time to time. As the leader of the government of this country he has the direct responsibility for changing the situation whereby one arm of this parliament is now rapidly falling into disrepute, if not contempt. It is a situation, sir, that cannot be allowed to continue. Certainly the time has come when something definite must be done.
The hon. member for Fort William (Mr. Badanai) published a pamphlet in 1962, and I quote the following paragraphs from the last page of it:
The Senate should not be a device to reward party faithful for past favours, or for getting rid of a minister whose presence in the cabinet is no longer desirable. Here is where the room for reform lies . . .
Regardless of which party will win the next election, I express the hope that the Prime Minister of the day will embark on a new policy with regard to the appointments to the Senate, and let that body continue to do the useful job which they are now performing within the limits imposed on it.
I think I had better not read the comments I made after the last group of appointments to the Senate because I am afraid the paper might catch fire. I can honestly say that since I came to this house I was never more disappointed than when I looked at the list of the appointments made recently to the other place. That is no reflection on the individuals themselves, but the reason why they were appointed was apparent to everybody in the country.
June 13, 1966

The hon. member for Fort William put his finger on the reason in the paragraph I have quoted from his pamphlet:
The Senate should not be a device to reward party faithful for past favours, or for getting rid of a minister whose presence in the cabinet is no longer desirable. Here is where the room for reform lies.
I think there is no doubt in the minds of most of the members of this chamber that if we continue along the path that we have been following, which is to make the other place a receptacle of people who have been discarded by the public, and of people who are being rewarded for faithful service to a party, we shall be doing an injustice to democracy.
[DOT] (6:10 p.m.)
There are as many other points of view as there are parties in this house. The day of the two-party system as we know it I am sure has passed. Considering some of our provincial legislatures, I am sure that members of the government and the official opposition would be the first to admit that we have not gone back to a two-party system, and I am sure that members of the government party and opposition in the legislature of my own province would be the last to dispute that fact. In that province there are no Conservatives in the legislature, and have not been for some 12 years. There are very few Liberals in the legislature there. Many points of view have been expressed by the people of this country through their action at the polls, and in my opinion the expression of these people must be represented and voiced in the other place.
With those few words I shall resume my seat. I hope that the government of the day, through the leadership of the Prime Minister, will take steps to make certain that the present method of appointing members to the Senate will be changed.


Mr. Marcel Prud'homme (Saint-Denis):: Mr. Speaker, in rising to make a few observations on the notice of motion, I surely did not expect I would have to uphold either the Senate or the method of appointment of members to the other place. I thought I would speak on the notice of motion of the hon. member for Cariboo (Mr. Leboe) which reads as follows:
That, in the opinion of this house, the government should give consideration to the setting up of ten
The Senate
provincial commissions, consisting of representatives appointed by each province and an appointment or appointments by the federal government, for the purpose of making appointments to the Senate of Canada.
Without meaning any offence to my good friend the hon. member for Cariboo (Mr. Leboe), I must say I have never heard him explain why he advocates setting up ten commissions, instead of five, or one, for that matter. I thought he would have adhered to his notice of motion. I am forced, however, to make a few comments on some of his remarks, because personally I do not see the purpose or the necessity of setting up ten provincial commissions, plus a federal commission, to sit together and suggest Senate appointments to the government.
I think it has become common practice to criticize people appointed to the other place, as if the fact of having been long active in politics, a party contributor or treasurer would transform appointees into wretched persons or persons unfit to appear in public.
I should like merely to endorse the comments made by Senator O'Leary, who is certainly not a Liberal senator, when he said on June 2, 1965, as reported on page 192 of the Debates of the Senate:
Honourable senators, I have been reading, during the past two weeks, the convocation addresses of eminent persons before our various universities; and almost invariably these men stressed the need to get young Canadians interested in public life. They pleaded with students to go out and get into the dusty arena of practical politics and thus to help serve their country.
But, honourable senators, according to the Toronto Star's editorial, which has been repeated again and again in the press of Canada during the past three or four weeks, when it comes to appointing persons to this house, politicians are to be regarded as lepers and the house is to be filled with musicians, sculptors, painters, and so on, Honourable senators, that is nonsense.
In concluding, he said the following:
I repeat that, when I quit this Senate, whoever may be prime minister I hope he replaces me by a good staunch party man who has worked at party politics, and not by a man who, as I said is good at music or sculpturing.
Mr. Speaker, the more I listened to the hon. member, the more I realized that people seem to be unaware that, from the very beginning of confederation, it was provided that regions would be represented. Is it necessary to recall that Canada is divided into territorial divisions: 24 senators for Quebec, 24 for Ontario, 24 for the western Provinces, 24 for the Maritimes and six for the province of Newfoundland.

June 13, 1966
The Senate
Mr. Speaker, I fail to see why, in 1966, in an extremely difficult political period for Canada, we should try to divide this country more and more into areas. If we, in the House of Commons, are about to suggest that the Senate should reflect somewhat our own image, I wonder what would be the usefulness of the second house, namely the Senate.
If we are going to ask that all provinces, Alberta, Saskatchewan, British Columbia, Quebec or the Maritimes, etc. be represented exactly as they are in the provincial political field, I think we would then have a mere duplication of what already exists.
I have no doubt that if we asked that each region be represented according to the party in power, we would only encourage divisiveness in Canada. We know the member of parliament must not limit his interests to his riding. I am to some extent defining my own role as member, and I know I was elected to represent my riding. But I assure you that when I come to the House of Commons, I want to represent more than the limited interests of my riding, I want to take an interest in all that goes on throughout Canada, whether in Alberta, British Columbia, or elsewhere; in fact I feel that where things Canadian are concerned, I too should have my say, just like my good friend who preceded me can do as concerns the province of Quebec. I recognize his right, as he does mine, to discuss what happens in Quebec as well as in the prairies.
And I believe the same applies to some extent for senators. They are chosen by a man who was elected by the Canadian people, namely the prime minister. I find it more and more difficult to understand why attempts are made to remove from the people elected by the people such prerogratives as they hold through the constitution. As soon as a Prime Minister has the least bit of latitude, the least prerogative, in short as soon as he is given some authority, you hear at once that those powers should be delegated to groups, organizations, representatives who, in my opinion, are far less represnetative than the right hon. Prime Minister of the country himself. And, in this case, there is no doubt that it is the prerogative of the Prime Minister to appoint the members of the Senate.
Now, what will the Prime Minister do with this prerogative which he has? If that Prime Minister is a wise man-and I believe it will be in the interest of a Prime Minister, who is the leader of a party, to make appointments that will not be too unpleasant-and if he has a political sense, he will see to it that the

appointments he makes are as profitable as possible, as far as the national interest is concerned, and he will choose the most qualified people. I could not understand a prime minister having a personal prerogative under the constitution to nominate people to the other house or to key positions who would appoint people unqualified for these responsibilities. I cannot undertand this insistence, when you make a rather thorough survey of all the appointments or when you simply consult the Parliamentary Guide and read the biography of each of the honourable senators.
[DOT] (6:20 p.m.)	|
When you speak about Senate reform, I think that instead of saying that the senators should be appointed by the premier of some province or other, encouraging in this way the division of the country, as I said a while ago, we should rather try-and I hope my hon. friend will agree with me-to find the best formula under which the the Canadian Senate of 1966 should operate.
Would it not be rather by extending the powers of its members? Would it not be especially by asking them instead to sit on commissions? As a matter of fact, it is the member for Villeneuve (Mr. Caouette), I think, who said that the redistribution should not have been entrusted to ten provincial commissions made up of university teachers or of people unable perhaps to act as practical politicians; I do not see why that work should not have been entrusted to a Senate committee. That is how the Senate could prove justified or useful.
As far as I am concerned, as long as the Senate exists, as long as our Canadian institutions are not reformed, I feel there is no reason for giving some provinces a prerogative which belongs to the Prime Minister.
I recall that it is for these reasons-I am referring to the notes of my professor of constitutional law, Mr. Maurice Ollivier, notes which I have kept and which I now find quite appropriate today-during the past federal-provincial conferences when a formula to amend the constitution was being sought, that the provinces were insistent on their claims that the sections relating to the Senate be not amended without their consent.
The argument of the provinces, particularly of the province of Quebec, mouthed by Mr. Duplessis and, I should add, since that time by Mr. Paul Gerin-Lajoie, and shortly by someone else, was that if the Senate was truly designed as a defender of provincial rights, the sections of the British North America Act providing for the number of senators, for
June 13. 1966

provincial representation in the Senate, tor the increase or reduction in the number of senators should not be amended without the consent of the provinces.
Mr. Speaker, it is surely through a new definition of the powers of the Senate that we can ask its members to revert to their original functions. Instead of seeking to have them appointed by the provincial premiers, should we not rather give some consideration to the original functions of the senators? Have they consistently fulfilled the role they should have been playing? That is a question, I think, we could easily ask ourselves. It is a question I have often asked myself and I wonder whether the other place has truly fulfilled the first functions conferred upon it?
I am thinking more precisely, of the responsibility, incumbent upon it, to protect the rights of the minorities in each of the provinces. In school matters, has the Senate used its authority for the defence of minorities?
I hardly need to answer. I rather think that the last hundred years of history probably show that the Senate was unconcerned.
We can easily say, I think, that it is wrong to claim that all regions of Canada are not represented. I said a while ago that when the Prime Minister proposes to call someone to the dignity of the Senate, his choice is rather restricted. We know, for instance, that in the province of Quebec, he must select someone to represent a territory, which is non-existent in other provinces.
As we know, in the case of the industrial province of Ontario, he may simply choose a resident of that province. Of course, his choice will rest on someone acceptable to all Ontario electors. When exercising his prerogative, of course, he would surely not appoint someone who is unacceptable. A few moments ago, I expressed my feeling about those people who keep running down men who spent most of their lives in politics.
I do not take a stand on the Senate, as it is composed, nor on the method of appointment, because I am of the opinion that, under the circumstances, unless changes are brought about-and we must admit that in 1966-there are constitutional changes in the offing in this country which will make it more Canadian and which will enable each citizen to find, in his own way, the best way of life-
The Prime Minister will continue, as is his privilege, to appoint in each of these divisions, the person who can best represent the diversified interests of our country.
The Senate
I have not found any example of really bad appointments. There may have been some but one cannot condemn a whole institution because of a few unfortunate appointments.
If I may be allowed to add a last thought, I submit that if the Senate is to carry out exactly the same functions as the House of Commons, if it must reflect exactly the political image of the country, then we would only duplicate the House of Commons.
I cannot believe that members of this house, with all their experience, would be ready to accept that the Senate be an exact replica of the House of Commons.
As far as I am concerned, there is no reason for the setting up of ten provincial commissions consisting of representatives appointed by each province, with members -the French translation says members appointed by the federal government-I wonder whether the word 'membres" means "membres de la Chambre des communes". This is a French translation which does not correspond to the English version I read. It is said that members are to be appointed by the federal government for the purpose of making appointments. Is it the objective of the hon. member that members of this house be appointed to the provincial commissions consisting probably of representatives of the provincial legislatures, and that together, they make recommendations to the Prime Minister? I submit that we would thus be put in a practically negative situation.
In my opinion, if the Senate must continue to exist, the best way to appoint senators is still to leave the matter in the hands of the Prime Minister. The Prime Minister we have today is a perfect example of a man who can use his political sense and there is no need to share the fear of our hon. friend to the effect that the provinces will not be adequately represented in that house.
I say it is incumbent on the Prime Minister to avail himself of this privilege so as to establish throughout Canada a fair representation. What would ensure that these commissions would agree to appoint women representatives to the Senate? What would ensure that these representatives of the different provinces would agree to let the voice of the various ethnic groups in the country be heard? What would ensure that these various commissions could, for example, suggest the appointment of a French speaking senator in Alberta-an appointment which, in fact, has

June 13. 1966
The Senate
always been due to the French speaking element and which has not yet been made, but which will surely take place in the near future? What would ensure that these various commissions would make the very suggestions which are necessary so that all the groups of our Canadian society be represented?
With a prime minister who exercises his prerogatives wisely, one may expect a fair and just representation of the various elements which make up our society as well as of the various regions of our country. This, in fact, is the aim of the motion presented by the hon. member.

[DOT] (6:30 p.m.)


Mr. H. E. Gray (Essex West):: I think the hon. member for Cariboo (Mr. Leboe) is to be commended for placing this motion before the house today. I say this, not so much because I agree with the principle of his motion-I will say at the outset that I do not-but because I think that it is useful for all those who are interested in the development of our system of parliamentary government to discuss, to consider and to investigate proposals for the change of our parliamentary institutions, proposals aimed at making them work better and more effectively. I will say, however, Mr. Speaker, that my view, which I hope to put forward more extensively in the next few moments, is that the adoption of the proposal contained in this motion will not make our system of parliamentary government at the federal level work more effectively, but that it will do just the opposite.
Let us go back to the time of the Fathers of Confederation and look briefly at the reasons for establishing not only an elected House of Commons but also an appointed upper house, a Senate. I think it will be found that basically there were four reasons for the institution of the Senate in the initial structure of the new Canadian nation. First, I think it is clear that at that time there was a fear of the concept of democracy-a fear of the concept of the operation of the popular will.
Second, I think there was at that time a feeling that there needed to be some special form of protection of the institution of property, some special voice in the parliamentary system for property interests. Third, I think it was felt there was a need for some manner of protecting special privileges; I do not mean privileges of regions so much as privileges of classes or social groups in the operation of the parliamentary system. Fourth, a need was

felt for the protection of provincial and regional interests.
Whatever the Fathers of Confederation may have felt about the validity of these four arguments, I think that we in this house will agree that our views today are quite different on these points from what they were over a hundred years ago. There may still be some people, but there could not be very many, who accept the idea that the ordinary man-the so-called common man, if there is such a thing-is not fit to pass judgment and to make decisions on how his own affairs should be conducted. I think it is pretty well accepted that the ordinary man is quite capable, through his vote and through other means available to him of approaching his government through his elected representatives or even more directly of putting forward his views and expressing his ideas on how our government should be run.
I also think we have given up the idea that there is need for a special form of protection in our parliamentary system for the institution of private property. I think this problem, if there ever was one, has been largely eliminated by the evolution of an economic and social system which makes it possible for the ordinary man to acquire property in ways that the Fathers of Confederation would be amazed to see. They would be amazed to see, for example, to what extent factory workers acquire their own cars, their own homes and in those homes all sorts of appliances which, whatever value they may have or whatever effect they may have on our pace of life, are certainly such that the ordinary man today has as much a stake in the existence of this country as had any landed proprietor of over 100 years ago who felt that his property rights needed some special protection against what he then considered to be the uninformed approaches of the ordinary man. We have certainly rejected long ago the idea that certain economic or social groups need special protection through the institution of an upper house.
There remains then for us to examine the concept that provincial or regional interests need to have some special form of expression through a chamber of our parliamentary system. I think it is clear today that for various reasons the provinces have been put into the position of being able to take care of themselves without the need of special protection provided by a body of a national parliament created to give them or their representatives
June 13, 1966

some particular voice. Over the years between confederation and the beginning of the second world war, the courts, and especially the British privy council did an all-too-effec-tive job of constructing a framework of protection beyond what many others intended, including I feel even the Fathers of Confederation. I think it is clear, whether we all agree or not, that this certainly extended the powers and the role of the provinces beyond even the extensive powers they were given in the clear words of the British North America Act. The decisions in particular of the British privy council, which was then the final court of resort for Canadians, gave the provinces such power in many areas of economic and social policy that today the federal government is not in the position to act in these areas without the agreement or at least the co-operation of the provinces.
The provinces also have always found their premiers, their cabinets and their provincial assemblies quite willing to assert themselves and their own point of view. I think that because of the willingness, the ability and in fact the strong desire of provincial leaders to assert their ideas in the national sphere, there appears to be no real need for spokesmen for provincial interests in a body such as the Senate of Canada. Our means of communication today provide for direct contact with the federal cabinet, the Prime Minister and his ministers in ways undreamt of one hundred years ago. The Fathers of Confederation could hardly have been expected to consider that it would be possible for the premier of British Columbia, for example, to pick up a telephone and speak to a federal cabinet minister, or to the Prime Minister of Canada himself, on some matter of concern to the province of British Columbia.
[DOT] (6:40 p.m.)
Perhaps even more important, as a means of permitting provinces and their leaders to put forward their points of view, has been the development of the federal-provincial conference. Concern has been expressed in this house and elsewhere over the implications of the growth of the institution of the federal-provincial conference one hundred years ago. It is clear that the growth and de-velompent of the concept of the federal-provincial conference, not just as an occasional meeting taking place on an irregular basis every few years but on an almost month-to-month basis in our national structure, involving meetings not only between members
The Senate
of the cabinets of the provinces and the federal government but people at the official level both provincially and federally, as well has I think eliminated the need which the Fathers of Confederation might have been seen over 100 years ago for the use of the Senate as a place where provincial and regional voices need to be heard.
I think, Mr. Speaker, that the putting into effect of the idea contained in the resolution of the hon. member for Cariboo would do much to weaken the ability of the federal government as a national entity to make decisions and to implement these decisions in the interests of Canada as a nation.
There are those who feel there has already been a trend away from the federal government and toward the provinces in the matter of decision making. I am not going to enter into this subject this afternoon because it is one to which we could devote not only this private members hour, but whole days of discussion. Nevertheless I certainly feel there is need for a strong and effective government which can operate on a national basis across Canada to deal with problems which, whatever they may have been in the day of the Fathers of Confederation, can be effectively dealt with today, in my view at least, only on a national basis.
I note, Mr. Speaker, that the hon. member for Cariboo spoke critically of the method of appointment and of the calibre of Senators appointed at the present time.


Bert Raymond Leboe: Mr. Speaker, might I interrupt the hon. member to point out that I was emphasizing the method of appointment. The country is full of good people. I was merely emphasizing the method in which individuals arrived at a certain place. I was not casting any reflection on those individuals. Canada is full of good people.


Herbert Eser (Herb) Gray: I thank the hon. member for Cariboo for that intervention because I think it leads very well to the point I was about to attempt to make. I think the hon. member's intervention will illustrate even better perhaps than I could myself the idea which I am trying to get across to the members of this chamber.
Is there any certainty that the putting into effect of the hon. member's suggestion would bring into the Senate of Canada people who have ability and a record of achievement which is more impressive than those who are there at the present time? The hon. member

June 13, 1966
The Senate
for Cariboo has just suggested-and I thank him for this suggestion-that good people are to be found throughout the country, and I agree with him. But he has not demonstrated in any way that his concept of provincial commissions would bring people into the Senate who were any better qualified than those who are now being appointed and who have been appointed up until now.
If it is true that this is being done-and I am not saying that I accept this concept-then why would provincial premiers be any the less likely to reward political service or to find a place for those who have served their province in one capacity or another by recommending them for appointment to the Senate of Canada?


Bert Raymond Leboe: Mr. Speaker, I hesitate to interrupt the hon. member again, but at no time did I mention any provincial premier.


Herbert Eser (Herb) Gray: I am not saying that provincial premiers will make appointments, but certainly the hon. member speaks in his motion of setting up provincial commissions consisting of representatives appointed by each province. Now, who would appoint these representatives if it were not the provincial premiers? And what would these commissions represent if it were not the viewpoints of the provincial premiers holding office from time to time? I suggest to the house that no reason has been advanced to show that the criteria which would be used by these commissions would operate any differently from the criteria used at the present time for the appointment of people to the Senate of Canada.
At least, Mr. Speaker, those who are being appointed today are those who have some sense of responsibility toward the concept of a national federal state for Canada, of the Canadian nation as an entity, instead of just a weak confederation of provinces. At least, Mr. Speaker, the method we use today will avoid the possibility of having a group of senators who would obstruct or block legislation because they are more concerned with putting forward a narrow regional or provincial view than with supporting something which would benefit a great nation of Canada stretching from ocean to ocean.


Bert Raymond Leboe: Mr. Speaker, the hon. gentleman is assuming that today senators are not appointed from the various provinces. Of course they are. It is the method of appointment to which I am drawing attention. The hon. member is getting away from the issue.


Herbert Eser (Herb) Gray: Today there is a kind of limited way of narrowing or limiting this risk because people appointed to the Senate have usually been active in some form of public life, and have had an opportunity to develop some sense of responsibility.


An hon. Member:: As defeated candidates?


Herbert Eser (Herb) Gray: Perhaps as defeated candidates. The senators develop some sense of responsibility similar to that developed by representatives actually elected by and responsible to the people.


Mr. Deputy Speaker:: Order, please. I must inform the hon. member that the time allotted to him has expired.


Herbert Eser (Herb) Gray: Mr. Speaker, could I have consent to continue? I shall be a few more moments only.


Mr. Deputy Speaker:: Does the hon. member have unanimous consent to continue?


Some hon. Members:: Agreed.


Herbert Eser (Herb) Gray: I thank the house for its indulgence. I know that some hon. members for whom I have the greatest respect do not agree Quite obviously with what I am trying to put forward.
Even though senators do not have to face the public through the vote, and even though there is no way of recalling them, they do form part of their party groups, and attend the caucuses of their parties. They are able to develop a certain sense of moral obligation if you like and this applies whether a senator's party is in office or not.
Because it is argued that senators, in a democratic way, are not accountable to the people through elections, it is argued by some that the appointments to positions of senators should go to scholars, artists, and those completely outside political life in this country.
I say, Mr. Speaker, that we should not confuse the concept of the need for a sort of legion of honour with the need for a legislative body. If there is a need to more openly recognize our scholars, artists and poets, and perhaps there is, then let us do that. Let us do it through a concept similar to the French legion of honour. Let us not confuse the need of honoring people in the intellectual and academic sphere with the need for setting up another sort of legislative body. Intellectuals and scholars may never have had a real link with or great concern for the public. Even
The Senate
though candidates are defeated they will not have-and I see the hon. member for Anti-gonish-Guysborough and I do not mean this personally-the sort of intellectual arrogance occasionally seen which stems from not having their views tested in the popular marketplace of an election.


Mr. Stewart:: May I ask the hon. gentleman a question?


Herbert Eser (Herb) Gray: Yes.


John B. Stewart: I notice that the proposal is for provincial governments to participate in the selection of members of the Senate. I want to ask the hon. gentleman if the adoption of this motion, and the putting of it into effect, might not encourage a multiplicity of parties in this country, an effect damaging to parliamentary democracy as we know it.


Reynold Rapp: This is a good point.


Herbert Eser (Herb) Gray: I must say that the way to eliminate the multiplicity of parties in this country is for those who do not agree with that concept to so conduct themselves through their policies that the people will not be interested in voting for any other party than the one carrying out the policies. It is true, none the less, that multiplicity of parties has created problems for sound and effective parliamentary government. Those who support minority parties create the risk of bringing about certain forms of weakness in the abilities of governments to act firmly and effectively in the national interest.


Reynold Rapp: A very good point.


Herbert Eser (Herb) Gray: With respect to the argument advanced by the hon. member for Cariboo (Mr. Leboe), that his proposal would reflect views expressed by the ballot box, I submit that in provincial elections the people are directing their thoughts only to electing a government to carry out the administration of their province. Not to any other issue. If the hon. member is serious in his argument, let him support the concept of an elected Senate. If the people wish to elect a senator from his party or from some other minority party, even though this may be detrimental to effective national government, they could do so.
I do not think the hon. member's argument is sound in support of his motion. I therefore ask hon. members of this house to reject it. May I call it seven o'clock, Mr. Speaker.


Reynold Rapp: Well said.

June 13. 1966
Bank of Canada Act


Mr. Deputy Speaker:: Order, please. The hour for the consideration of private members business has expired. The house will now revert to the business interrupted at six o'clock.



BANK OF CANADA ACT


[Stage Direction]
The house resumed consideration of the motion of Mr. Sharp for the second reading of Bill No. C-190 to amend the Bank of Canada Act.
David Lewis: At the
adjournment at six o'clock, Mr. Speaker, I was indicating our doubts as to the efficacy of the policies for the guidance of the economy represented by higher interest rates, and those concerned with the global totals of the currency. As I said, that has an indiscriminate effect and therefore is discriminatory against the small borrowers, whether they are small businessmen or small individual borrowers.
I think the most important section of the bill before us concerns the relationship of the government to the policies pursued by the Bank of Canada. I have very grave doubts as to whether the particular provision of the bill that has been placed before the house by the Minister of Finance carries out the purpose which we should all have in mind, namely that monetary policy is essentially government policy and not that of the Bank of Canada.
[DOT] (7:00 p.m.)
I begin by reminding hon. members of the preamble of the Bank of Canada Act as it is found in the Revised Statutes of Canada, 1952.
Whereas it is desirable to establish a central bank in Canada to regulate credit and currency-
I draw the attention of the house to the following words:
-in the best interests of the economic life of the nation-
I continue quoting:
-to control and protect the external value of the national monetary unit and to mitigate by its influence fluctuations in the general level-
I ask the house to note the following words:
__of production, trade, prices and employment,
so far as may be possible within the scope of monetary action, and generally to promote the economic and financial welfare of the Dominion.
What this preamble means, and what in fact monetary policy relates to, is the entire 
economy of the country. When the Bank of Canada was set up by Prime Minister Bennett-the Leader of the Opposition (Mr. Dief-enbaker) mentioned with some pride the fact that Mr. Bennett introduced the Bank of Canada Act-the proposal of the then prime minister in 1935 was a proposal to make the Bank of Canada a privately-owned bank which was none the less to be a central bank. This was mistaken, and in 1936 the minister of finance, Mr. Dunning, and the Liberal government of that day recognized the fact that the Bank of Canada was dealing with policies which affected the entire economy and could not be separated from government control.
My first proposition, and there is nothing original about it, is that there has been undesirable confusion about the part played by the Bank of Canada in connection with the operation of policy, requiring technical knowledge, and that part which is concerned with the initiation and implementation of monetary policy. We have frequently taken the attitude in Canada that, because the technical operations of the bank must necessarily be left to technicians, the making of policy by the Bank of Canada should also be an independent process. This, in my respectful submission, is sheer nonsense. The Minister of Finance in his proposal in this bill, if he will forgive me for saying so, carries on the same nonsensical myth. What he proposes is that normally there should be consultation between the minister and the governor of the bank. Should a difference of opinion arise then the minister may, by order in council, tell the Bank of Canada what to do. But he must specify the thing to be done and specify the term during which his instruction is to last.
This carries forward the undesirable concept that the Bank of Canada is some sort of independent body which has independent authority to make monetary policy for Canada. I assume that the clause before us is concerned not with the technical carrying out of a particular policy but the making of policy, the decision as to what policy should in fact be carried out.
This is my submission. I do not say this dogmatically but nevertheless I do so with some conviction. Monetary policy itself is entirely, not partially but entirely, the responsibility of the government. The Minister of Finance at any time must be able to say what this policy should be and the governor of the Bank of Canada must be by law
June 13, 1966

obliged to carry that policy into effect by whatever technical means he may think advisable.


Mitchell William Sharp: I am very interested in the hon. member's views. May I ask whether he thinks it would be desirable in the event of a difference of view about monetary policy that the public at large should be aware of it?


David Lewis: Not necessarily. I imagine there are other ways of making the public at large aware of what is happening. What the public at large is interested in is the nature of the policy, not the fact that the minister and the governor of the bank have a difference of opinion. I believe the public at large could not care less, and I do not think it is of the slightest importance whether or not the minister and the governor agree or disagree. What is important is that we should know what the policy of the government is.
I can see no reason why the minister should not be able to control the policy as it affects the monetary system of the economy in the same way as he controls fiscal policy. We become tied by tradition. I support this is true of all people at all times and in all places. We become sold on an idea and cannot get rid of it. The fact is that the minister's decisions on taxation policy are just as important as decisions on monetary policy. Frequently, indeed, they have a more direct effect on the economy. When the bank rate is increased and the interest rate rises in consequence there is usually a time lag before the effect is felt. But a tax revision, whether upward or downward, invariably has an immediate effect on the economy.


Mitchell William Sharp: Is the hon. member suggesting that every activity of the central bank in the market should be subject to parliamentary approval, such as a decision to buy some government securities or sell them?


David Lewis: The minister's question enables me to illustrate what I have said much more clearly than I have done so far. His question is related to a direct operation to implement a policy. If it were decided by the minister that the interest rate should go up and that the currency available should be contracted, then there are certain operations which the Bank of Canada may carry out in order to achieve this purpose. Certain other steps could be taken to achieve an opposite purpose. This is a technical operation of the bank and the minister does not have to interfere with it at all. It is his responsibility,
Bank of Canada Act
and when I say this I mean the responsibility of the government and himself, to determine whether or not it is right at any given time for the amount of currency to be constricted and for the interest rate to go up in order that certain purposes may be achieved. Such decisions should not be left to the governor of the bank to be taken at his own discretion.
This has been argued in Canada over the years. When the late Mr. Dunning, minister of finance in 1936, introduced the act which made the Bank of Canada a publicly owned institution he spoke as follows, and I commend these words to the minister. They are to be found in the 1936 Hansard at page 3260:
[DOT] (7:10 p.m.)
-the matter of public ownership is in my opinion much less important than that of governmental control. If we study the constitution of central banks from this aspect we shall find ample precedent for the attempt which we are making to give the government adequate control over the Bank of Canada.
In 1956 Hon. Donald Fleming agreed with this but, despite what the right hon. Leader of the Opposition said, when Mr. Fleming became minister of finance he stated, as recorded at pages 3098 and 3099 of Hansard for April 27, 1959:
I wish to make it quite clear that the government, as such, does not exercise control over the money supply or over the amount of money in circulation.
Further on he said:
-I would point out that in the matter of monetary policy this parliament has placed the responsibility and indeed the power in the hands of the Bank of Canada. The government does not exercise any sway in the field of monetary policy.
I think Mr. Fleming was wrong.


Mitchell William Sharp: So do I.


David Lewis: In a speech broadcast by the C.B.C. on October 1, 1959, the present Leader of the Opposition said:
I should point out that the Bank of Canada, not the government, controls the money supply in Canada.
Let me interject that there again is the confusion between the technical operations which do the controlling and the policy decision as to whether there should be control and in what directions that control should be exercised. The Leader of the Opposition went on to say in that speech:
The bank was set up under law by act of parliament. It is independent and autonomous. It has one master, though: parliament, and through parliament the people.



E336 COMMONS DEBATES

[Stage Direction]
June 13, 1966
Bank of Canada Act
If it was that, and I really doubt if that was a statement of fact at that time, it was wrongly independent and autonomous.
My point is this, Mr. Speaker. We have reached in our economy, as have other countries, a situation of complexity which everybody now agrees requires an amount of planning by government which economies in the past did not require from the point of view of hon. gentlemen opposite and of those to my right. Personally I belong to a school of thought that has always believed our economy cannot serve the interests of the people without direct and conscious government planning of the direction in which the economy should go at any given time. But now the idea of planning is universally accepted and, whether members believe 50 per cent or 100 per cent in planning, one way or another there is hardly a member of the house who denies the basic proposition.
Some 30 years ago when I first became active in public life people denied government planning. They said it was wrong for governments to plan, but now every member of the house acknowledges the fact that government planning is necessary. I disagreed with the minister's budget. I thought what he tried to do was inadequate but none the less what he tried to do was to plan the economy from the fiscal point of view, to have certain fiscal policies which in his view would be adequate to meet what he thought were inflationary pressures in the economy.
I say that just as important as fiscal policy is the monetary policy of the country, the financial policy. I say that even the clauses which are before us in this bill, despite what the minister said, do not make it sufficiently clear that the monetary policy is his and not that of the Governor of the Bank of Canada. Essentially the minister says in this bill: I consult with him but if he disagrees with me I can override him.
I say that this bill ought to make it clear that monetary policy basically and at all times is the responsibility of the government, that it is the minister who decides what that policy ought to be, that it is the Bank of Canada which advises him, in the same way as many other people advise him, and that it is the Bank of Canada which carries that policy into effect through the technical operations which are required.
It is not sufficient to say that if the minister disagrees with the governor then certain steps will be followed. Indeed, it seems to me to be wrong in principle to suggest that each

time the minister is in disagreement with the Governor of the Bank of Canada this will happen. I suggest to hon. members that that will be a deterrent to this or any other minister insisting on his policy because in order to insist on the policy which the government considers to be right he will have to say to the governor: Look, fellow, I am going to order you to do this. If the governor is a man of ideas, a man of principles and selfrespect, all of which and perhaps a great deal more is true of the present governor of the bank, then the governor will say to the minister: You do it without me; I am going home; you can have my resignation.
If the minister is faced each time with the likelihood of the resignation of the Governor of the Bank of Canada I suggest that nine times out of ten the minister will bend his policy in order to avoid both the economic and political consequences of the resignation of the governor of the bank. There is no need for this at all. There is no reason in the world why the legislation should not clearly spell out that monetary policy is the responsibility of the government and that the Governor of the Bank of Canada must always implement the policy decided upon by the government and the Minister of Finance. If you spell that out as a regular part of the routine of the bank, then the kind of difficulty I have indicated would invariably follow a difference of opinion between the two would be obviated. I say again that I cannot imagine any minister of finance insisting on his policy being carried out in the face of the likely resignation of the governor of the bank unless the difference is so tremendous that he is willing to risk the consequences of such resignation.
In short, Mr. Speaker, I question the philosophy behind our attitude to the Bank of Canada up until now and even the philosophy behind the amendment which the minister has proposed. I do not deny it is an amendment which will make the situation much better in that it sets out government responsibility more clearly than was the case hitherto, but it still accepts a falacious philosphy that the monetary policy of the country is something that should be given to an outside body as its responsibility to evolve, even though in consultation with the minister and that it is only in an exceptional case that the minister can impose his will on the governor. This is a false understanding of monetary policy.
June 13, 1966
[Stage Direction]
There is not a branch of the economy that is not affected by the monetary policy initiated and implemented by the Bank of Canada. There is not a branch of the economy that is not affected when the Bank of Canada increases interest rates. There is not a branch of the economy that is not affected when the Bank of Canada increases or decreases the amount of money available. There is not a branch of the economy that is not affected by the action of the Bank of Canada when it insists on greater or lesser reserves being held by the chartered banks or when it buys and sells securities on the market.
All of these actions have a direct effect on the economy as a whole. The philosophy, the policy, ought to be the responsibility of the government and its responsibility alone in precisely the same way as it is now the government's responsibility to make taxation policy. After the minister consults the Governor of the Bank of Canada, consults his deputy, consults his economic advisers and consults, as he did the last time, organizations across the country, he is in the end responsible for taxation policy. In exactly the same way, and indeed a more urgent way, is it necessary that he be responsible for monetary policy.
Mitchell William Sharp: Again the hon. gentleman has left out an important step in the process of tax changes. Tax changes come before parliament for approval. He is surely not suggesting that every transaction of the Bank of Canada should be brought to parliament for approval. I do not make the taxation policy. It is this parliament that makes the taxation policy.
[DOT] (7:20 p.m.)


David Lewis: Mr. Speaker, the basic policy of taxation is presented by the minister, and if he is trying to get out of that responsibility in that way let me say to him that there are, I suppose, literally thousands of acts taken in the Department of National Defence, the Department of Public Works and in every other department he can think of based on policies which have an effect on our economy from day to day but which do not come before parliament for our approval. If the monetary policy pursued by the government is wrong in the opinion of parliament there are ways by which we can express criticism such as through motions of non-confidence and so forth, but the fact that the minister takes responsibility does not mean that parliament cannot have its say.
Bank of Canada Act
What I question very seriously is the philosophy behind the proposition that there is something sacrosanct about the Bank of Canada and something sacrosanct about monetary policy that is handed over to people outside the government. The policies followed must be the policies of the minister and the government at all times and under all circumstances, with the Bank of Canada then entrusted to carry them out. My time has expired so I shall resume my seat, Mr. Speaker.


Robert Norman Thompson: Mr. Speaker, I find the remarks and the general thesis presented by the hon. member for York South (Mr. Lewis) most interesting. I agree with the argument he has used with reference specifically to the policy of the Bank of Canada but I agree only up to a point. It seems to me that the Minister of Finance (Mr. Sharp), whether or not he will admit it, he has a great deal to do with the actual policy and operations of the Bank of Canada.
At the present time we have a tight money policy in Canada. It is not something new that the amount of money in circulation should be actually used to control deflationary or inflationary tendencies. It is obvious at the present time that the government feels there is a danger of inflation and that it is necessary to institute certain government policies, but I maintain that this is not the policy of the Governor of the Bank of Canada but rather the policy of the government of Canada and that it is merely the governor of the bank who is instituting it.
At the present time we are definitely experiencing a shortage of money for finance and credit and it is a deliberate shortage. It cannot be explained in any way except by the fact that it is a policy of the government and the Minister of Finance. Because the Bank of Canada has as one of its basic functions control over finance and purchasing power in the economy, the Bank of Canada is being used to institute this policy at this time. Whether it is admitted or not, it seems to me that it is at least apparent that the government is making monetary policy and using the Bank of Canada to implement it.
There is nothing wrong with that procedure but I think at this particular time we ought to be concerned with not only the policy but who is actually responsible for that policy so there can be no misunderstanding. In following up the remarks just made by the preceding speaker let me say that this is a

June 13, 1966
Bank of Canada Act
basically important premise which underlies the actual amendments that are being proposed to the Bank of Canada Act.
It was very interesting to hear the minister talk about changing the percentage of reserves so far as banks are concerned in respect of the issuance of credit. When he suggests increasing the amount of reserves under this new formula for adjusting secondary reserves what he is actually doing is putting in words that which is taking place and is the practice at the present time. This can be discussed when we reach our consideration of the bill clause by clause.
So far as monetary policy is concerned it has been the practice during the past number of years to use it as a tool for curbing excessive booms and stimulating lagging economic situations. This is why we now have tight money. The government believes that a tight money policy is the one that should be followed at this time. I am disturbed because bankers, and I am not only referring to private bankers but to Mr. Rasminsky, the present governor, as well, tend to minimize this fact. I do not know why that should be so because I think it is a simple but cold, hard fact. This is surely the reason why we have tight money at the present time. I do not agree with that policy nor with the suggestion that we should be manipulating the actual money supply as it relates to our economy because so long as we can gear the economy to the consumers' needs and their ability to use that which the economy is able to produce I do not think we should be concerned with inflation as such. After all, the only reason why we produce anything is because of the prospect that a consumer somewhere will use it.
The situation at the present time is not inflation in monetary supply but inflation in price. It is through the manipulation of monetary supply that the Minister of Finance is attempting to exercise some control at this time, but it seems to me he is actually doing things in the reverse order. This is not a policy that is new but one that has been considered on several occasions in the past.
I want to remind the Minister of Finance of a speech made by the late prime minister Mackenzie King in 1935 when the Bank of Canada was something new and just being given its present role. At that time he said:
-once a nation parts with the control of its currency and credit, it matters not who makes the nation's laws . . . Until the control of the issue of currency and credit is restored to government and

recognized as its most conspicuous and sacred responsibility, all talk of the sovereignty of parliament and of democracy is idle and futile.
On the basis of that statement, which I believe to be correct, there is nothing wrong with the Bank of Canada or the Minister of Finance through his control over the Bank of Canada, being made responsible for the monetary needs of the economy. That is a basic function of government.
In this regard I should like to refer to a statement made by Henry Ford in which he tried to set out this same principle in a practical way. He said:
The function of money is not to make money, but to move goods. Money is only one part of our transportation system. It moves goods from man to man. A dollar bill is like a postage stamp: it is no good unless it will move commodities between persons. If a postage stamp will not carry a letter, or money will not move goods, it is just the same as an engine that will not run. Someone will have to get out and fix it.
Our monetary policy at the present time needs fixing and we should not try to cover up responsibility for the readjustment of monetary policy. That responsibility should be accepted by the Minister of Finance. The policy embodied in the present legislation must fall within the responsibility of the minister and the government. Whether or not they will admit it, that is the fact of the matter.
The Bank of Canada is actually responsible for carrying out the monetary policy of the government in power. Let us face that fact and let us make sure that the policy which is carried out by the Bank of Canada is the policy best suited to the needs of a given economy. We are not simply faced with problems related to automation at this time, we are faced with problems of cybernation. Our problems do not relate only to economic production but to the economy of the consumer, and our monetary policy must be geared to that need. Our problems relate directly to cybernation and all its implications which are fundamentally related to monetary policy and, unless we realize that, a financial breakdown and economic disaster are inevitable. Unless we can implement effective and acceptable means of distributing sufficient purchasing power to consumers, regardless of whether or not they are wage earners, unless we can enable the benefits of total national production to be distributed promptly and efficiently, the economic liberty and freedom of the individual are lost.
June 13, 1966

[DOT] (7:30 p.m.)
Therefore I suggest to the Minister of Finance that this is his responsibility. Let us make sure that we understand that he as Minister of Finance has laid down a policy so far as the Bank of Canada is concerned which should make effective a monetary policy geared to the consuming needs of our economy, something that is basic at the present time as cybernation takes over more and more.
As we are discussing the principle of this bill I should like to mention a few points in relation to the function of the Bank of Canada which I think substantiate the remarks I have made and are very important as we consider this legislation. The purpose of the Bank of Canada is to control the total money supply of Canada in the best interests of the country, and the most important means of presently accomplishing this is through the sale of government bonds by the Bank of Canada. Actually this makes the Bank of Canada a borrowing agent, an agent in the issuing of government of Canada bonds. In fact, in 1965 the Bank of Canada issued to the market some $1,700 million worth of bonds. In this regard it looked after the preparation, promotion, sale and distribution of these bonds.
Strangely, this year a new policy was instituted which I do not think is a policy of the Governor of the Bank of Canada but is a policy of the Minister of Finance. The Bank of Canada adopted the policy of purchasing some of the bonds it had issued. In fact, at the present time something more than 12 per cent of all the bonds issued by the Bank of Canada have been bought back by the Bank of Canada. It pays itself the interest that is chargeable to these bonds. It comes in as an income to the Bank of Canada and is turned back to the consolidated revenue fund. There is nothing wrong with buying up Canada's debt. It is monetary policy moving in the right direction, but let us face up to it and name it for what it is.
This makes the issuing of the bonds of Canada one of the most important functions of the Bank of Canada and I think it is logical to assume that the government has to take responsibility for this kind of policy. Therefore let us face it. The Bank of Canada also serves as the custodian of these bonds; it even provides the bookkeeping facilities for their sale and transfer. In addition to this service rendered by the Bank of Canada in the issuance of bonds, it is also responsible for getting currency into circulation. In 1965 the
Bank of Canada Act
Bank of Canada printed more than $1,500 million worth of new currency, putting the currency supply at an all-time high of $2,513,600,000. This is a very important function of the Bank of Canada.
In addition the Bank of Canada stores the nation's gold supply, although gold has nothing to do with currency or bonds or with the money that is actually in our pockets. Last year the Bank of Canada stored a basic amount of $1,137 million worth of gold bars in its vaults, allowing for the fluctuation from day to day. But this has nothing to do with the sale of bonds or with the issuance of currency or coinage; it relates only to a reserve for foreign exchange. These are the basic functions of the Bank of Canada. I am not trying to oversimplify them but am relating them specifically to the responsibility of seeing that the economy of Canada has an adequate amount of purchasing power in the form of money.
This being so, Mr. Speaker, it seems to me that the policy which governs the Bank of Canada is very basic and fundamental. This responsibility cannot just be passed over to the one responsible for the administration of that policy, the management of the Bank of Canada. It comes right back to the government, and this legislation is very basically related to it.
In our economy at the present time I think some obvious things are not being considered in the drafting of policy as it relates to the Bank of Canada. No longer is it adequate that we merely classify capital in two groups, tax capital which is collected from the pockets of the taxpayers to pay for the services rendered by government, and private capital in the private enterprise system under which we operate. The tremendous need for capital for development in the public sector requires recognition of a third classification of capital, namely, public or social capital. This is the kind of money that is needed to build our schools, hospitals, harbours, bridges, highways, projects which in themselves do not earn money but merely facilitate a service, projects which are liquidated over a period of years of amortization.
Unless we make provision within our monetary policy for the recognition of this additional type of capital we are going to be faced with a constant increase in the cost of servicing our national debt, a constant increase in the debt and taxation structure of the country. As long ago as 1963 the Federation of Mayors and Municipalities submitted

June 13, 1966
Bank of Canada Act
a brief to the Royal Commission on Banking and Finance. Their main recommendation was:
That the federal government, in co-operation with the provinces, should establish a national municipal loan fund (or bank) for the purpose of facilitating the borrowing operations of municipal governments.
I mention this because the most acute and difficult area of governmental finance today is not at the federal or provincial but at the municipal level, because the amount of municipal debt increases year by year. It is interesting to note that the municipal bonded debt in Canada rose from $833 million in 1946 to nearly $9 billion in 1965. This is an increase of approximately 10 times in 20 years.
Together with this increase in municipal bonded debt has come a tremendous increase in the cost of servicing the debt. This is illustrated on the federal scene as well because at the present time more than $1,180 million of tax dollars is used to service the national debt of this country. I maintain that if the government would recognize the need of adding to its monetary policy the recognition of a third sector of capital, the public sector, whether it be called public capital or social capital, we would not be faced with the difficulties in regard to monetary policy that we face at the present time which the government is trying to control the economy with a tight money policy resulting in the amount of money in circulation actually being decreased. This is the type of manipulation which is being used by the government as a means of control and for which the Minister of Finance must take responsibility. This policy does not work in the best interests of the economy because we see what is happening at the present time. We are not building the number of houses that we should build. Goods are not moving because there is not the money in circulation. Those things which we recognize as being desirable objectives in our economy are not being attained because of the policies of the government.
Our monetary policy is restrictive in this regard. The United States market this year is already approximately three times greater than it was last year. The policies of this government are defeating what should be the purpose of our monetary policy. Therefore, Mr. Speaker, unless the government and the Minister of Finance assume their responsibility and recognize the fact that the Bank of Canada is merely the means of carrying out policy, we will go along from boom to bust,

from depression to prosperity, from inflation to deflation with a constant increase in the cost of living and the cost of taxes. In addition, the higher the cost of living goes the more strikes we will have such as the ones we are faced with today which seriously affect our economy. We are also not giving any consideration to those on fixed incomes, particularly those living on pensions which were fixed at a time when the cost of living was not nearly as high, and the whole economy and the Canadian people generally suffer as a result.
[DOT] (7:40 p.m.)
So, Mr. Speaker, I think the Minister of Finance had better face up to the fact that he is responsible for the policy of the Bank of Canada and that only if that policy is adjusted to the needs of the economy are we ever going to have a satisfactory monetary policy. I suggest that the federal government use the Bank of Canada to provide capital-I am speaking now of the third category, public capital-free of interest for every construction loan necessary to finance national capital wealth projects such as the seaway and other internal waterways, hospital facilities, tourist attractions, schools or any other type of project for which the government has to borrow money. We cannot find reserves of capital in Canada under the present tight money policy, so we go to the United States, borrow money there and place ourselves in bondage which we agree is not in the best national interest.
If the Bank of Canada can print the bonds of Canada, if it can be responsible for the currency needs of this country, why can it not be responsible for this kind of credit as well? This newly created real wealth would balance out with the newly created financial grants needed to produce it. If we did that we could let the international exchange rate float. This would then supply the additional Canadian capital so badly needed. Therefore, if monetary policy is to be realistic so far as the present situation is concerned the Bank of Canada should be authorized to form what might be called a municipal development bank, in the same way as the Industrial Development Bank is a division of the Bank of Canada, to provide the public or social capital that this economy needs. This would obviate the necessity for the present tight money policy because adequate money would be provided to the private sector for the development of our commerce and industry. I think that the Bank of Canada is basically
June 13, 1966

responsible for the administration of this kind of policy but it is the government which is responsible for its institution.
Therefore, in closing, I wish to make this suggestion to the Minister of Finance. In view of the fact that apparently he does not wish to admit responsibility for the monetary policy of this country but would sooner pass it on to the Governor of the Bank of Canada and in view of the argument he put to the previous speaker in regard to this very subject, I suggest to him that if he wishes to attune our monetary policy to the needs of our economy he should create a permanent monetary commission. We in the Social Credit party have advocated this for as long as 20 years. This commission would be responsible for the determination and spelling out of the monetary policy as put forward by the Minister of Finance to the Governor of the Bank of Canada. Representatives from the Bank of Canada, from the chartered banks, the Department of Finance, agriculture, labour and business throughout the country should sit on this commission. The commission might perhaps be an expansion of the board of the Bank of Canada and would meet regularly to consider all questions with regard to the financial and monetary policy of the country.
In our view such a permanent monetary commission could be made directly responsible to the representatives of the people in the House of Commons in the same way as the Auditor General is responsible. It could be called periodically before the appropriate committee of the House of Commons to give an account before the members of this house of what is the actual monetary policy of this country instead of it being kicked back and forth between the political side and the Bank of Canada. I believe this would provide for a much more satisfactory monetary policy, the implementation of which is the responsibility of the Bank of Canada.
I will end my statement at this point because we must get into committee so we can have a full discussion of Bill C-190. Regardless of whether or not the Minister of Finance is willing to listen to the suggestions I have made, I believe he will have to admit that under the present set-up he is responsible for the final, fiscal policy of this government. We need something more adequate than the tight money policy which the government is apparently favouring at present because it is defeating the very purpose of the Bank of Canada which is to make sure
Bank of Canada Act
that an adequate monetary supply is provided to the economy of this country.


Herbert Wilfred Herridge: Mr. Speaker, I wish to rise and, as a pragmatic socialist, support wholeheartedly the ideas put forward by the member for Red Deer (Mr. Thompson). I have never understood why our provinces and municipalities have had to go to the New York money market to borrow money when this credit would be issued on the basis of Canadian national resources, Canadian industrial equipment and the ability of Canadians to produce. I support wholeheartedly his contention that this is a function which should be performed at cost by the Bank of Canada for the Canadian people. I agree with him that such a monetary policy would enable us to retain control of our economy and to obtain the social and private capital that is required for the development of our country. This is a mystery to me which I have never been able to understand.
In this connection I wish to quote from one or two letters. I have here a letter from the Department of Finance dated May 21, 1952, which reads as follows:
Dear Sir,
I have your letter of May 6, 1952, and am replying to your questions in the order in which you ask them.
1.	The Bank of Canada holds many securities in its investment portfolio which form part of the unmatured funded debt but its weekly statement does not show a breakdown of its holdings by issues. At the time of issue the bank may purchase small securities both for its clients (other government agencies) and for itself, but the relative amounts are not disclosed.
2.	As and when securities are issued to the Bank of Canada, payment is made by a deposit to the credit of the Receiver General's account with the
bank.
3.	You will notice on page 54 of the 1951 public accounts that the summary of security issues and redemptions during the year specifically excludes treasury bills. Treasury bills included in "unmatured funded debt" are not shown in the table of new security issues for reasons of space. They are issued on the average every second week and including them in the table of new security issues would mean a listing of about 24 items.
Treasury bills appear in appendix No. 7, pages 112 to 113 of the 1950-51 public accounts about the middle of the page. They are shown as having paid interest varying in rate from .512 per cent to .755 per cent.
4.	$200 million treasury notes were originally issued on May 1, 1947 to provide funds for the redemption of various refunding loans.

June 13, 1966
Bank of Canada Act
Why could this not be done at the present time?
$550 million treasury notes were issued on March 1, 1947 to replace a substantial part of $606 million treasury notes issued on September 1, 1946.
This gentleman, who is a very important member of the Department of Finance, goes on to say:
$90 million 1.5 per cent bonds issued on November 1, 1949 and due November 1, 1952 was part of a total of $300 million issued in connection with the redemption of $268 million 1 per cent 8th Victory Loan issued on May 1, 1945 to the public for cash and the $290 million 4.5 per cent conversion loan issued on May 1, 1931 and called for payment on November 1, 1949.
$185,495,000 1.5 per cent bonds due March 1, 1953 was part of a total of $325 million issued as a renewal of 1.5 per cent bonds due March 1, 1950, which bonds were issued on March 1, 1948 for cash.
[DOT] (7:50 pm.)
5.	As you will have gathered from the above, the three year bonds with maturities on November 1. 1952 and March 1, 1953 are shown in the total, namely, $300,000,000 and $325,000,000 respectively, in Appendix No. 5, page 108 of the 1950-51 public accounts.
6.	During the fiscal years ended March 31, 1951 and 1952 redemption of securities issued to the Bank of Canada totalled $1,500,000,000 represented by four issues of six-month treasury notes. Funds for the redemption of these notes were provided by the issue of new notes.


Mitchell William Sharp: Very clear.


Herbert Wilfred Herridge: Yes.
7.	Various expenditures listed under the heading of War Demobilization and Reconversion, Special Expenditures and Government-Owned Enterprises have no corresponding assets in the accounts of Canada. There are no itemized statistics available showing the classes and amounts of such expenditures, short of tracing such expenditures through public accounts for the various years.
The government's practice in recording assets and liabilities was explained by the then minster of finance in his budget speech of May 18, 1920, when he said, in part, "Assets which are not readily convertible, as the specie reserve is convertible, or are not interest producing, are not such assets as ought to be deducted from the gross debt".
Appendix 27 of the public accounts for 1938, shows the adjustments authorized by the Canadian National Railways Capital Revision Act, 1937.
Yours very truly,
W. C. Clark
I have read that, Mr. Speaker, to indicate what is possible if the Bank of Canada were only used for the Canadian people as a whole. I should like to make reference to a bill, No. 297, to amend the Bank of Canada Act which received first reading on February 22, 1954. It was piloted by the then minister of finance. Section 18 (1) (c) of the bill read:
Buy or sell securities issued or guaranteed by Canada or any province.

This was the explanatory note:
Paragraph (c) of subsection (1) removes the limitation imposed by former paragraph (d) of subsection (1).
Paragraph (d), which was repealed, read:
Buy and sell securities issued or guaranteed by Canada or any province having a maturity exceeding two years from the date of acquisition by the bank, but the bank shall at no time hold securities not maturing within two years having a par value in excess of 50 per cent of its outstanding note issue and deposit liabilities, nor shall the bank at any time hold securities not maturing within ten years of a par value in excess of five times the amount of the paid-up capital and rest fund of the bank.
Before I conclude I should like to quote part of a letter written by Mr. K. W. Taylor, former deputy minister of finance, dated July 26, 1957. He said:
You are correct in your assumption that the Bank of Canada pays for its purchases of bills by crediting the purchase price to the account of the Receiver General of Canada with the Bank of Canada.
I have quoted the correspondence from Mr. Clark and Mr. Taylor, former deputy ministers of finance, to indicate the capacity of the Bank of Canada to provide social and private capital for the development of this country.
As a pragmatic socialist I wholeheartedly support the arguments which were put forward by the hon. member for Red Deer for the utilization of the Bank of Canada for the issuance of loans to provinces and municipalities on the basis of the security they can advance in terms of natural resources, industrial equipment and the capacity of the Canadian people to produce so that they will not have to continue to go cap in hand to New York for money. This would be entirely unnecessary if we used our own Bank of Canada properly.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on finance, trade and economic affairs.


Hon. E. J. Benson (Minister of National Revenue) moved: the second reading of Bill No. C-193, to amend the Public Service Superannuation Act, the Canadian Forces Superannuation Act, the Defence Services Pension Continuation Act, the Royal Canadian Mounted Police Superannuation Act, the Diplomatic Service (Special) Superannuation Act, the Intercolonial Prince
June 13, 1966

Edward Island Railways Employees' Provident Fund Act and the Canadian Corporation for the 1967 World Exhibition Act.
He said: Mr. Speaker, I rise to speak on this statute adjustment bill, which is a bill of the type very often urged on us by the hon. member for Carleton (Mr. Bell). The hon. member has said that we should not run these items through the estimates but rather should have a statutory adjustment bill, and this is what we now have in front of us.
As I indicated when speaking on the resolution which preceded first reading of this bill, the main purpose of this legislation is to provide for the co-ordination of a number of acts dealing with the provision of superannuation benefits for members of the public service of Canada with the Canada Pension Plan, as well as the Quebec Pension Plan in the case of persons employed in the province of Quebec.
The acts which are to be co-ordinated in a variety of ways that will be explained in the course of the debate are the Public Service Superannuation Act, the Canadian Forces Superannuation Act, the Royal Canadian Mounted Police Superannuation Act, the Diplomatic Service (Special) Superannuation Act and the Intercolonial Prince Edward Island Railways Employees' Provident Fund Act. The references to the Defence Services Pension Continuation Act and the Canadian Corporation for the 1967 World Exhibition Act appear in the title of the bill for reasons unconnected with the Canada Pension Plan legislation.
Hon. members will by now have had an opportunity to study the various methods by which it is proposed to accomplish co-ordination of the various measures I have mentioned and at the same time satisfy the principles which were explained at the resolution stage.
I should like to state again that the first principle that the total contributions paid by the employee and by the government on a salary on which contributions are now being paid under the relevant superannuation acts should not be increased. In order to accomplish this a portion of the contributions has to be diverted away from the superannuation fund to the Canada Pension Plan or the Quebec Pension Plan, as the case may be.
For example, for male contributors to the public service superannuation plan the reduction will be from 6.5 to 4.7 per cent in respect of that portion of salary from $600 to
Pensions
$5,000 which is subject to Canada Pension Plan contributions. For female contributors it will be from 5 per cent to 3.2 per cent in respect of that same salary portion.
While the percentage figure may differ for other increments, the amount of existing contribution rates which is to be diverted to the Canada Pension Plan or Quebec Pension Plan, as the case may be, will be the same, 1.8 per cent from $600 to $5,000 in every instance.
Reduction in the rates of contributions payable to the various superannuation funds means that the benefits payable out of these funds will likewise have to be reduced in respect of the period of service beginning January 1, 1966 for which the lower contributions will be made. In giving effect to this reduction the second principle comes into play, namely, that the combination of benefits under the relevant superannuation acts and the Canada Pension Plan after the reduction takes place should not be less than the benefits which would have been payable under the formula in the relevant superannuation acts prior to these amendments.
[DOT] (8:00 p.m.)
These proposals do not affect in any way the entitlement of persons who retired prior to the coming into effect of the Canada Pension Plan. In other words, Mr. Speaker, the intention of this plan is to affect contributions and benefits of members of the civil service of Canada or the public service of Canada subsequent to the present date. Consequently persons who have already retired prior to January 1, 1966, need have no concern that their benefits will be reduced because of the advent of the Canada Pension Plan. It is just not possible for this to happen under the provisions of this particular act, or that any portion of the contributions which they have made prior to January 1, 1966 will be transferred to the Canada Pension Plan account.
It was not long after the Canada Pension Plan was announced that requests for the adoption of the two principles I have mentioned were made to the government. These requests came from the staff associations themselves. In response to these requests the Minister of Finance referred to his advisory committee on the Public Service Superannuation Act the question of developing a formula which would meet these requirements in so far as that act was concerned. The advisory committee, which is made up of

portion of their combined benefits is concerned, from the escalation provisions contained in that legislation.
Hon. members will be interested to note that 95 per cent of the members of the regular forces and 80 per cent of the members of the R.C.M.P. will fall within the scope of the integration provisions which I have described. Fewer than 5 per cent of the members of the armed forces, those who enrolled prior to 1939, and fewer than 20 per cent of the members of the R.C.M.P. come within the scope of the continuation acts which I have mentioned and are thereby excluded from both the contribution requirements and the benefits of the Canada Pension Plan.
The next area of general interest which I should like to mention is the one which provides for greater portability of pension benefits. Perhaps the most important of these is the new clause in the Public Service Superannuation Act which would extend the power of the minister-and here I mean the Minister of Finance-to enter into reciprocal pension transfer agreements with any employer with an approved pension plan. This, in practice, means a plan of a type which is acceptable for income tax deduction purposes. A further provision extends the provision in the existing law under which actuarial equivalent benefits may be payable prior to the age of 60 under the Public Service Superannuation Act, while other clauses would permit the compulsory locking-in of contributions made after a date to be proclaimed by the governer in council in the case of a person retiring after the age of 45 with at least ten years of service. Most if not all of these changes are being introduced for the purpose of achieving a greater increase of portability in relation to other employer-employee pension plans in Canada.
It is the introduction of this concept of portability of pensions which is responsible for many of the amendments in the Diplomatic Service (Special) Superannuation Act where, as a result, benefits will henceforth become payable as a matter of right instead of being subject to a grant by the governor in council.
Still other clauses in the bill are designed to broaden the categories of employees covered by the Public Service Superannuation Act. Prevailing rate and seasonal employees will now be required to become contributors at an earlier date than has heretofore been the case. As a result they will derive the
Pensions
added advantage that they will be covered by the supplementary death benefit plan under part II of the Public Service Superannuation Act as well.
[DOT] (8:10 p.m.)
The bill provides for the removal of the present ceiling of $5,000 on the death benefit. In its place will be a provision setting the amount of death benefit at the multiple of $250 equal to or next above the salary of the employee. Actuarial advice indicates that this feature can be added to the plan for civil servants without jeopardizing the soundness of the plan. Rates for the civil servants who are covered will remain unchanged at 10 cents for every $250 of coverage.
Members of the regular forces have also been included under this plan and will be eligible, like members of the civil service, for the larger amounts of benefit. Their experience, however, as a younger and healthier group has been so much more favourable than that of civil servants that the adoption of this provision for a higher ceiling, related in the same way to their pay, can be accompanied by a reduction in the rate of contribution from 10 cents to 5 cents a month for every $250 of coverage. Since this would create a basic difference between the two groups of participants under Part II of the Public Service Superannuation Act and could create some confusion in the future, it is proposed to drop the members of the regular forces from this part of the Public Service Superannuation Act and to add a new Part III instead to the Canadian Forces Superannuation Act to provide them with coverage.
Basically this means that members of the armed forces will receive a higher death benefit at a much lower cost and rather than tie this in with the present superannuation act we shall create a new Part III in the Canadian Forces Superannuation Act. In effect, members of the forces will be able to get $1,000 coverage for 20 cents a month.
Hon. members will have noted that the bill seeks to remove a number of anomalies which have become evidence in the administration of the acts during the years since they came into force or were last amended. I do not propose to deal with most of these at the present time but will be pleased to explain the remedial provisions on reaching the various clauses concerned at the committee stage should any questions be asked.
Three or four amendments are proposed to give recognition to recommendations of the

June 13. 1366
Pensions
public accounts committee while others are of a purely administrative nature to deal with changes which appear necessary as a result of the experience gained over the years. In other words, where we have been introducing $1 items to carry many of the necessary changes in this particular legislation over the years we are now, following the recommendation of the hon. member for Carleton, introducing a statute amendment act to take care of these necessary amendments.
In keeping with the objective of giving more of the detailed administrative responsibility to the department administering the acts, there are a number of amendments which transfer certain authority from the Treasury Board to the appropriate minister.
In so far as the handling of the superannuation account is concerned, the three main superannuation acts, those dealing with the public service, the armed forces and the R.C.M.P., are being amended to implement the government's proposal for the systematic amortization of any deficits which arise from salary revisions or are reported as a result of the statutory quinquennial actuarial reviews of the superannuation accounts established under those acts. This complex problem is referred to in the Auditor-General's report for the year ended March 31, 1965, pages 34-37, as well as in previous years' reports. Following a policy statement on this matter by the former minster of finance on March 6, 1964, legislation was approved by parliament and given royal assent on June 2, 1965, for the purpose of ensuring that actuarial deficits in any of the main superannuation accounts arising from salary revisions affecting a significant number of public servants would be amortized on a systematic basis by equal contributions over a five-year period.
In this respect I should like to compliment the former minister of finance for what he did in this regard and draw attention to what the previous government failed to do by way of providing actuarial requirements of the superannuation account. Instead hon. gentlemen opposite let it grow into the huge deficit which faced this government when it took office.


An hon. Member:: If you want to get the bill through, don't be provocative.


Edgar John Benson: The amendments contained in this bill are designed to improve the wording of the existing legislative authority as it applies to the amortization of actuarial deficits arising from salary revisions, and to

extend the same principle to deficits arising out of the quinquennial actuarial evaluations of the different superannuation funds.
I conclude with a reference to two matters which will be of more than passing interest to members generally. One has to do with the post office strike of last summer, the other with the question, raised in debate on the resolution, of officers retiring from the armed forces and accepting employment in the public service. I will deal with this latter matter in more detail during the committee stage.
When the postal strike occurred in July and August last year several thousand employees absented themselves from employment without leave and thereby disqualified themselves technically from the right to contribute to superannuation in respect of those days of unauthorized absence, as well as from the right to claim those days as pensionable days of employment in calculating pension entitlement on retirement. The wording of the superannuation legislation permits days of authorized absence from employment to be counted for pension purposes under conditions which are spelled out in the act and regulations but does not provide for the counting of days of unauthorized absence. When this problem came to the attention of the responsible officials last December it was decided that legislative authority would be sought at the earliest possible opportunity to permit coverage of all postal employees for the days in question, even though these were days when the majority of postal workers were engaged in an unauthorized work stoppage. One of the amendments proposed in this present bill will give the governor in council authority to deal with this particular and, I hope, isolated problem by special regulation. I am sure that under the new collective bargaining legislation, to be reviewed by the committee which has been established for this purpose, this sort of thing will not happen again in the future.
I am satisfied that the provisions I have described will go far to meet the problems which have been the subject of representations by many retired members of the armed forces and by members on the other side of this house. The government, if given the authority to deal with this problem by regulation, will continue to keep the matter under periodic review and take such further action as subsequent experience with the proposed new regulations indicates to be desirable. I shall be pleased to deal with retired officers of the armed forces when we get into the
June 13, 1966

committee stage on the clause which deals with the subject.
It there are other questions I have not touched upon and which are of interest to hon. members I will be glad to deal with them either when I speak in closing the debate or during the clause by clause discussion ot the bill.


Hon. H. A. Bell (Carleton):: Mr. Speaker, if there be a more complex and complicated bill to come before parliament this session, I hope someone other than myself may be its critic. To work one's way through the intricate labyrinth of the diverse provisions of this bill is a task for a Philadelphia lawyer and I do not think an Ottawa solicitor or a Kingston accountant has achieved that particular distinction.
[DOT] (8:20 p.m.)


Edgar John Benson: Would the hon. member permit a question? I would like to ask him if he will give me an opportunity to do this as a Kingston accountant when we get into committee stage?


Richard Albert Bell: I am sure the hon. gentleman is going to have many questions to answer in committee stage, and I hope it is going to be at committee stage in a special joint committee and not in committee of the whole.
I say that none but an actuarial expert could be certain that he fully understands the technical and involved draftsmanship of this bill. It is for that reason I submit it is imperative that the bill should be sent to the special joint committee on the public service rather than to have it considered in the first instance by the committee of the whole. I appeal to the minister to adopt this suggestion because I am certain it will save time in the long run.
In all candour I say to the minister that I have tried as earnestly and valiantly as I can to study this bill in great detail and to seek to understand the integration of the proposed amendments with the existing superannuation structure. As a result I wish I could assert that I had made myself the master of the amendments. I have not, and when a member who has the background which I have in superannuation problems, from professional practice in the city of Ottawa over the years, from service in the last parliamentary committee on superannuation, and from extensive handling of superannuation matters as parliamentary secretary to the minister of finance, when such a member is perplexed
Pensions
about this bill I am sure there are other members equally perplexed, perhaps even the minister himself, for I thought that in his statement tonight he demonstrated that perplexity.
Before that special joint committee we would have the opportunity to examine experts, particularly that knowledgeable, yes, that brilliant pension expert, Mr. Hart D. Clark, to hear representatives of the staff associations and to assure ourselves that this bill is a wise and proper revision of the superannuation provisions.
There are three other reasons why I submit this bill should go to the special joint committee. First, I have reason to believe, as has the minister, that the staff associations have not yet had the opportunity to study the bill. I believe the minister has had a telegram from at least one staff association, and perhaps two, objecting to the consideration, so early in the proceedings of this house, of this bill. This bill has been available for only six days and I believe it would be offensive to the staff associations, and indeed court real trouble, to proceed with a bill which so intimately affects every civil servant until the representative staff associations have had a proper opportunity to study it and to make representations.
I shall be frank with the minister and say to him that if he persists in ramming this bill into committee of the whole, clause 2 will not be passed until we on this side are given assurances by staff associations that they have had the opportunity to examine the bill in detail and have no objection to it, or have such objection as may be stated and then debated. I am most anxious to be co-operative with the minister but I am equally determined that the civil service shall be protected and the staff associations shall have the opportunity to examine the bill and to say whether it is satisfactory to their members.
Second, sir, I think it is quite evident that if the special joint committee does not examine the bill the Senate will send the bill to one of its committees. I do not believe that we who represent the public service of Canada in this elected chamber should abdicate our rights to the other place.
Third, the special joint committee could divide this bill into seven components and report seven bills to the house rather than this single, omnibus bill. I repeat what I said at resolution stage, that this technique of

June 13, 1966
Pensions
legislating by omnibus bill is sloppy, confusing and untidy, and I say it is genuine legislative heresy. I really thought it was quite cute of the minister to try to attribute to me the authorship of this particular type of legislation.
Yes, I did say on the estimates and I will repeat on the estimates that, instead of having dollar items, for those simple and ordinary situations which are not matters of principle there should be a statute law amendment act. I never said, and the minister cannot find it said in any place by me, that matters of principle should be legislated in an omnibus bill, and I say to him tonight that that is evil per se. I say this house ought not to permit what is being done in this bill. This issue was argued on the government's reorganization bill and I adopt all the arguments then advanced.
If the government is permitted to get away with this new legislative technique of amending seven bills by a single bill, it will not be long until the whole governmental legislative program is contained in each session in one single bill. I repeat that this legislative omnibus practice is evil per se and the time to stop it is now on this bill.
I think the minister is one of the more reasonable of the present ministry. I appeal to him to accept these arguments and to send the bill to the special joint committee. If he does not agree there will be a time when we shall have to test the sense of the house in this particular.
The integration of the Canada Pension Plan and the various superannuation acts has been a difficult and complex task. It is something that ought to have been done long ago. It ought to have been done at the time the Canada Pension Plan was brought forward. We are now suffering from the neglect at that particular time.
All of us will need to study carefully what the minister said tonight before we can approve or disapprove of the proposals he has made. What he has said has been technical in every detail. Surely, sir, since he has announced tonight some of these procedures and techniques for the first time, he cannot object legitimately to an opportunity for members of the opposition and officials of the staff associations to study his statement, and I think I must insist upon that opportunity before this bill proceeds further.
There are some features of the bill of which I approve fully. For example, the inclusion of wartime service as the equivalent
[Mr. Bell (Carleton) .1
of service in the regular forces removes an anomoly which should never have been permitted to arise. It will bring justice to a considerable number of officers and men now approaching retirement age.
The intention to take authority to modify the existing harsh provisions relating to pensioned officers of the armed forces who enter the public service is a step forward. What happened tonight is that the minister obviously had two or three pages of his notes in which he meant to describe to us precisely what was intended by this. He skipped those pages and jumped to the end, saying he was sure the house would agree with what he had just described.
Although he gave us a commitment, positive and clear, at the time of the resolution stage that he would describe all these matters on second reading he has not done so tonight. He has again postponed the situation and said he will do it when we are in committee of the whole. I think the minister at the resolution stage was less generous and less graceful than he usually is when he refused to satisfy our curiosity in relation to these matters, but his failure tonight to give an outline of what is proposed is intolerable.
What he is asking for is a blank cheque, and if an additional reason be required for this bill to go to a special joint committee then I say this is it. Clause 2 certainly should not be passed until the representatives of the armed forces have had an opportunity to express their opinion on proposals which the minister has yet failed to outline to the house despite his specific commitment to that effect. Certainly, sir, I would prefer, whatever the proposals of the government may be in this respect, that they should be part of the bill and not included in an authority to enact regulations, which is the purpose of the present proposal.
I am opposed to giving blank cheques to anyone, but this is what we are being asked to sign for the minister. I oppose this bypassing of parliament in respect of this particular situation. It is all very well for the minister to assert that under the R.C.M.P. legislation, enacted when the right hon. gentleman from Prince Albert was prime minister, there was an equivalent provision.
[DOT] (8:30 p.m.)
Perhaps we did make a mistake at that time. We were not infallible, but I have no patience with these tu quoque arguments. This parliament has suffered too much from this "you're another" approach, "tit for tat", a
June 13, 1966

*"Roland for an Oliver", and other forms of argument of this sort. All I wish to know is what is right in the existing circumstances, and I doubt if this can be ascertained without hearing evidence before a joint committee. I know this cannot be permitted to pass when the minister only explains what his proposals are when we come to our consideration of the particular clauses of the legislation. There must be an opportunity for a representative of the armed forces to know what is intended before we come to that, and to know what is proposed by the government.
One aspect of the delegated authority to make regulations is that the pensioned armed forces officers, warrant officers or petty officers, who are afterwards employed by an agent of Her Majesty, may have their pensions placed in jeopardy. This has not been the case in the past when a retired officer was employed by a crown corporation. Although this	has	been the	case with theR.C.M.P. in the past it is now imported into armed forces provisions for the first time. Obviously I agree that the treatment should be uniform,	but	it	should	be generous. Irepeat, sir, that I have the gravest reservations about	what	is	proposed in this particular and	I must	insist	that before we
advance at all in this legislation the minister tell this house what he intends.
One feature of the bill, which runs through many clauses, vests in a single minister powers heretofore exercised only by the Treasury Board. As emphatically as I can I oppose this proposal. No doubt the draftsman of this bill thought it would be neat and tidy, and in theory that is correct. But political practicalities are not always neat and tidy. The futures of many individuals are being delivered into the decision of a single minister. I have a very vivid recollection of how harassed a minister may be at a particular time and how he will sign, however strong-minded he may be, the documents put before him by trusted advisers just merely to end the horrible day. If the documents he signs are only recommendations to the Treasury Board two checks ensue, first, a careful scrutiny by the Treasury Board staff and, second, a review by at least three ministers on Treasury Board. One may argue whether three harassed ministers are better than one, but at least mistakes may be caught. The mere fact of Treasury Board review is a salutary deterrent to arbitrariness at the departmental level.
I ask the minister to consider this point of view. I do not seek to move amendments to
Pensions
each of the many clauses which, for purposes obviously of so-called administrative convenience, seek to vest in a single minister authority heretofore exercised by Treasury Board, but will the minister consider that there is a check and a balance in multiplicity of review? If he does not concede that, will he consider whether some appellate procedure is required? I will return to this subject during our committee consideration.
May I now turn to the question of the actuarial status of the superannuation funds. The new bill will provide for the immediate crediting to the superannuation acts of the amounts necessary to provide increased benefits as the result of salary increases and would spread payment of that amount over five equal annual instalments. I venture to draw specific attention to the reply I received to a question which appears in Hansard, for Monday, June 6, at page 5980. The position may actually be summarized by the answer to part 4 of that question, the question being:
4. What is the total actuarial deficiency in the public service superannuation accounts as of March 31, 1966, for which no provision has been charged to budgetary expenditure?
The answer was:
4. Public service superannuation account, $93,620,600; Canadian forces superannuation account, $53,601,200; Royal Canadian Mounted Police superannuation account, $3,115,200.
In other words, among the three funds there is an actuarial deficiency for which no provision has been charged to budgetary expenditures of over $150 million.


Edgar John Benson: I wonder whether the hon. member would permit a question?


Thomas Miller Bell: Yes.


Edgar John Benson: Would he care to tell me what the actuarial deficiency was when his government left office, and does he realize that any actuarial deficiencies that exist must be amortized over a five year period under the provisions of legislation passed by this parliament last year?


Thomas Miller Bell: The latter point is one to which I intended to refer and will do so immediately if the minister will hold his patience. The first point is one in respect of which I do not have detailed information immediately before me. If the hon. gentleman wishes to make this a matter of politics, that is his prerogative. I have approached civil service matters in this house without political partisanship. If the minister is trying to

June 13, 1966
Pensions
change that attitude, then let him stand up and do so.
The extent of this actuarial deficiency is still a serious matter in spite of the fact that it is spread over a period of time. When the minister replies I hope he will indicate whether this deficiency is likely to become progressively larger in years ahead. It is all very well to spread this over a period of years but if the impact is that it becomes larger year by year then this is a matter that must be considered by parliament.
I want to say to the minister that this bill is actually much more significant in its omissions than in its provisions, and I refer basically to four principles upon which the bill improperly is either silent or less explicit than it should be.
First, the vaunted provisions of the bill allegedly providing for portability, and the minister spoke tonight about this at some length, are much less than satisfactory. Indeed, all of us would agree that mobility of manpower is one of the most significant requirements for these days of advancing automation. The government of Canada should set the standard for all employers and should make full portability possible. The provisions of this bill instead are trivial and insignificant in this field. A genuine national plan of portability of private pensions is an urgent need and the government should set the model. It should start to set the model by this bill dealing with its own employees and should then set a model in a bill which deals with portability for those employees who are under the jurisdiction of the parliament of Canada, which would integrate other bills which I hope could be passed by all legislatures of the provinces. There is opportunity here for this parliament to give the lead in portability of pensions.
Second, I submit that all superannuation acts dealt with by this bill should now have a built-in escalation clause which would reflect rising costs and changes in salary scales. Under the Canada Pension Plan a technique of escalation of benefits has been adopted. This has been accepted as a matter of government policy for all Canadians. I submit it should be introduced into the various superannuation acts for the public service as a technique of avoiding the hardships and injustices which are bound to confront many present civil servants when they retire, as they have confronted so many civil servants

already retired. These hardships and injustices are the result of the lack of an escalation clause. An escalation clause in the public service superannuation and associated acts would have a further salutary advantage in that it might set a significant standard for industry generally.
[DOT] (8:40 p.m.)
Third, I submit that this bill ought to provide for a reduction to a five-year average instead of the present six-year average. This would have a further advantage in bringing pensions more in line with current conditions. When hon. gentlemen opposite were in office years ago they raised it from a five-year average to a ten-year average. When the government of the right hon. gentleman from Prince Albert was in office it was reduced from ten to six. I think now it ought to be brought down to a five-year average and ought to reflect, as a five-year average would, a closer approach to what are the economic conditions at the time of retirement.
Fourth, Mr. Speaker, this bill perpetuates the existing shabby and shoddy treatment of retired civil servants, retired members of the R.C.M.P. and of the armed forces. Persistently before 1957 and since 1963, hon. gentlemen opposite have scorned the claims of retired civil servants consonant with the erosion of the value of their pensions due to the fall in the value of money.


Edgar John Benson: Mr. Speaker, I rise on a question of privilege. A few moments ago the hon. member for Carleton indicated in his speech that I had said I would indicate what the new regulations were on second reading of the bill. I have had the opportunity of looking up what I said as reported in Hansard at page 6045.1 said:
When the pertinent section of the act comes up for consideration I shall be pleased to comment on its contents.


Erik Nielsen: That is debate, not privilege.


Richard Albert Bell: Mr. Speaker, I have not had an opportunity to read the particular section of Hansard to which the hon. gentleman has referred. I think his opportunity to rise on a question of privilege would be when I had concluded and not when I was dealing with another matter. When I have finished I will read his remarks, and if there is something to be said on the hon. gentleman's question of privilege I will deal with it at that time.
June 13. 1966

I want to say that hon. gentlemen opposite have persistently scorned the claims of retired civil servants. Only the government of the right hon. gentleman from Prince Albert showed any appreciation of this problem. That government met the problem and established a useful and salutary precedent which this government now ignores. I say to the Minister of National Revenue that the existing situation cannot continue. The plight of some retired federal government employees belies description. It is the clear responsibility, I submit, of the government to recognize the seriousness of the problem and as a good employer to take immediate action to alleviate the economic distress of large numbers of former public servants by making adjustments in their pensions. The longer retired, the more acute the distress is for these dedicated public servants of Canada.
The various governmental superannuation plans are undoubtedly among the best in the country. This is not the point. The fact is that the rapid rise in the cost of living has seriously depleted the value of the pensions. In 15 years the rise has been over 40 per cent.


Edgar John Benson: Mr. Speaker, I rise on a point of order. As I explained at the resolution stage, this particular bill does not deal with the position of retired civil servants but rather with the position of civil servants employed at the present time and their future pension benefits. Therefore although I sympathize greatly, as does the hon. member for Carleton, with retired civil servants, I do not think it is proper to debate the question of the pensions of retired civil servants under this particular bill which is dealing with civil servants employed by the government of Canada at the present time.


Stanley Howard Knowles: On the point of order, Mr. Speaker, may I point out that the minister himself made at least two references to retired civil servants when he was speaking tonight on second reading.


Mr. MacEwan:: That is right.


Mr. Speaker:: I am sure that hon. members do not expect me to make a ruling on the point of order raised by the minister. I would think that basically he appears to be correct. I do not believe that hon. members would want to engage in protracted debate on the question of pensions payable at the present time to retired civil servants. I would think that as much as possible hon. members would want to confine their remarks to the principle
Pensions
of the bill itself which, as the minister has pointed out, deals with civil servants employed at the present time and does not refer to retired civil servants.


Richard Albert Bell: With respect, Mr. Speaker, I would indicate that the principle of this bill is superannuation for all civil servants. This is an amendment to the act under which all superannuation is paid. Therefore if there are deficiencies in the payment of superannuation to anyone, I venture respectfully to suggest that this is the place where it may be properly discussed in the house.
It was under such a bill as this that similar matters were discussed on another occasion prior to the introduction of the pension adjustment act which was presented to the House of Commons by the former government. What I think is needed is to bring that pension adjustment act up to date. This is not to ask something which is unknown elsewhere. In fact both the United Kingdom and the United States have made regular adjustments in pensions and they have done this in the very type of act that is before us this evening. The United Kingdom has made at least six adjustments in pension for retired civil servants of that country, the latest being November, 1965. If you will permit me, Mr. Speaker, I would quote from page 1351 of the British Hansard of November 18, 1965, from a speech of the Chief Secretary of the Treasury, Mr. John Diamond, M.P., on second reading of the pensions (increase) bill:
This is an important bill. It relieves human hardship, it is an exercise in the all-important sphere of social priorities, it affects more than 700,000 people and those who live with them, it is costly- more costly than any of the similar measures which have been introduced on five previous occasions since the war-and it has been given pride of place in the government's legislative program.
I wish the Minister of National Revenue would give pride of place in the government's legislative program to just such a bill. I continue:
I will begin by explaining the cause of the hardship to which I referred. Public service pensions are normally related to length of service and pay at retirement. They carry no built-in right or promise of increase after retirement, but when there has been a marked fall in the value of money causing hardship to pensioners the government, as a good employer, seek the authority of parliament to pay increases to alleviate this hardship.
Then he went on to say this and I draw the attention of the house to it:
We are responsible for the management of the public services and are, therefore, concerned to


Stanley Howard Knowles: Mr. Speaker, my interest in this bill is in the main twofold. On the one hand I am interested in it from the point of view of parliament's responsibility to our public servants. I want to see a piece of legislation that deals with their pension rights in the fairest possible way. On the other hand I am interested in this bill in so far as it sets a pattern with respect to the integration of other pension plans with the Canada Pension Plan. Because it does set a pattern, it may well be followed or used as an excuse by private
June 13. 1966

employers. I feel therefore that we have to look at this piece of legislation very carefully before we give it final approval.
I therefore share the desire of the hon. member for Carleton (Mr. Bell) that this bill be looked at in the best possible way. He has suggested that it should be referred after second reading to the special joint committee on the public service and I think that that proposal has much to commend it. I recognize the problem that exists because three other heavy pieces of legislation have been referred to that committee and if we have four bills of the weight of these pieces of legislation the committee may find itself in session until Christmas.
Nevertheless I hope that the minister and the government will find some way to meet the point that the member for Carleton has raised. I do not know whether there is any rule under which we could refer a bill to a committee for a short period of time. That might be one answer to the problem. Another way might be to refer this bill to a special committee consisting of the limited number of members of this house who have studied it so that the civil servants who have drafted it for us might be able to give us the benefit of their knowledge of this legislation.
1 think that one of the most useful aspects of the experience which we had as members of the special joint committee on the Canada Pension Plan was that we had before that committee civil servants who took us through the bill clause by clause and enabled us to understand it in all of its detail. I think that is needed with respect to this bill. It is so complicated that I do not suppose every member of the house would want to know the meaning of every section but I think that at least a representative number of members of the House of Commons should know pretty clearly what is contained in this legislation and some vehicle should be found whereby we can deal with it more effectively than will be the case in the committee of the whole house.
I am putting forward these thoughts not in the spirit of any threat nor in an argumentative manner but rather in the belief that this bill deserves better consideration than it will get if we deal with it in committee of the whole house. After all, it contains 94 clauses and it comprises 72 pages. It is not much shorter than the Canada Pension Plan itself. The details of this bill are complex and it excels most bills in the way in which it can reduce mathematical formulae to many para-
Pensions
graphs of words. It seems to me to give a different treatment to the same subject matter under the different acts with which we are dealing. For these reasons it is the complex piece of legislation described by the previous speaker.
I hope, therefore, that the government will discuss with hon. members representing the various parties the possibility of finding some way in which we can study this bill more thoroughly and more effectively than we can in committee of the whole. If that is what we have to do, some of us are ready to do it but I think the bill deserves better than that.
[DOT] (9:00 p.m.)
I have two other suggestions which I should like to make. One is that I think at some point the government should produce what we call a white paper on these various pension plans. Perhaps this is something that does not need to be done until after the legislation has been passed. But just as it was necessary to produce a white paper on the Canada Pension Plan so that the public could understand that piece of legislation, I think the same will have to be done with respect to the Public Service Superannuation Act as it is affected by this bill, the Canadian Forces Superannuation Act as it is affected by this bill, and so on with all the other pieces of legislation. After all, the number of people affected by these various government pension plans adds up to a considerable section of what we call the public, and I think that they have the right to a white paper, or to a document, call it what you may, in which they can read in understandable language what are the provisions of their pension plans and what are their rights under those plans.
The other suggestion which I think may be appropriate, having spent a good portion of the week end wading through Bill No. C-193, is that perhaps we need another Carter Commission. Perhaps I should withhold the use of that name until we have seen what the Carter Commission produces by way of a report; but in so far as we have any notion of what the Carter Commission is supposed to do, we understand that it is supposed to take a look at the complexities of our income tax structure to see whether or not there are ways in which they can be simplified. I suggest that the time has arrived when it may be necessary to simplify to some extent the complexities of our many pension plans, particularly those which come under government supervision.

June 13, 1966
Pensions
I know why these plans as they now stand are so complex: they were drafted in the first instance; then proposals were made for changes and amendments; and then as amendments were added certain qualifications had to be recognized. And so on the story goes; and while the plan did not grow just like Topsy, it did grow in all sorts of directions and, as I say, we now have a very complex system of pension plans.
Therefore, I believe that consideration may have to be given to the establishment of something like the Carter Royal Commission to see whether it is possible to simplify these plans and to put them on a more readily understandable basis. It may be, or course, that the idea of a commission to survey all our pension plans could wait for a few years until the Canada Pension Plan comes into full operation and until other plans have established their relationships with it. When that time comes such a commission would find that it would have to go not only into government pension plans but into all pension plans in this country; and I think that day is coming soon. Pensions are becoming a very important aspect of our economy, and as they become important and as the capacity to enjoy retirement with a decent standard of living becomes recognized, I suggest it also becomes urgent that our whole pensions structure be looked at and made as simple and as understandable as possible, in view of the right of those affected to know what is in these plans.
Now, Mr. Speaker, I come to a few comments on bill No. C-193 itself, and I use the word "few" advisedly because with a bill consisting of 94 clauses one does not go into all the points on second reading but leaves something for whatever stage we are going to have later. The first thing I want to say is that as I read the bill it does come through with the things that the government said it would do in this legislation. Some of those things which it said it would do are details of which we approve, such as bringing in the armed forces and the Royal Canadian Mounted Police, establishing portability, taking care of the post office workers who were out on strike last summer and so on. But, of course, the main purpose of the bill was to establish a basis for integration of the various government pension plans with the Canada Pension Plan, and this the bill does.
Furthermore, this integration is accomplished in line with the original statement that was made on the matter on behalf of

the government as recorded in Hansard for November 18, 1964, at pages 10233 to 10235. The member who made that statement was the then parliamentary secretary to the minister of finance, now the Solicitor General (Mr. Pennell). That was the first official statement on what the government had in mind regarding the integration of these various employee plans with the Canada Pension Plan and, as I say, the bill before us carries out what the present Solicitor General indicated on that occasion.
I suppose that because I stand here and say that the bill does what the government said it would do, this should be taken as a compliment and nothing more need be said. However, I find I must repeat the statement which I have made on previous occasions, namely, that I am not yet sold on the principle of as complete an integration of other plans with the Canada Pension Plan as that proposed by the government in this legislation.
I shall come in a moment or two to the question of the extent to which there is complete integration as opposed to the extent to which integration is but partial, but in the main this bill is a piece of legislation the effect of which is to deny to civil servants either all or part of the extra benefit which they might have received had the Canada Pension Plan been recognized simply as a supplement or addition to what they already have.
I know all of the arguments about the public service superannuation plan being a good one and about its rates of contribution being high, but it still seems to me that an arrangement could have been made to enable public servants to get a better share of the extra benefit which is available to Canadians because of the Canada Pension Plan.
As I said, Mr. Speaker, when we were at the resolution stage I believed, and I still believe, that the purpose of the Canada Pension Plan was to provide a pension for employees who did not already have one. Its purpose also was to provide an additional pension for those already had some pension rights and benefits. I feel very sad when I see any group of workers or employees denied the possible chance of an improved pension such as the Canada Pension Plan was designed to provide.
I am going to make the prediction, Mr. Speaker, that 25 or 30 years from now-I do not offer this as a threat to send chills down the spines of hon. members-there will be
June 13, 1966

another Stanley Knowles in this house who will be pleading-


An hon. Member:: It might even be the same one.


Stanley Howard Knowles: Yes, it might be-


Mr. Dinsdale:: You will be in the Senate by that time.
[DOT] (9:10 p.m.)


Stanley Howard Knowles: Oh, no.-and the plea that that member will make 25 or 30 years from now will be that it was unfair to the civil servants of 25 or 30 years ago to deny them the benefits of both plans, the one under the Public Service Superannuation Act and the one under the Canada Pension Plan. I believe that 25 or 30 years from now a member will be asking the government of that day to give the retired civil servants of that day the better break that they should have been granted in the first place. As I say, I do not hold this out as a threat, although I shall try to stay here and plead the case, if it is necessary, 25 or 30 years from now.
Let me document what I mean about the denial of the extra benefits of the Canada Pension Plan to the public servants. The formula as worked out in the bill, when it gets into language, is pretty complicated. But when one reduces it to mathematical characters it is not quite so difficult to understand. When one grasps that formula he discovers that civil servants today who are near the point of retirement and have, say, only one or two years to go will, as the result of the formula provided in this bill, pay in the same amount they are now paying and get, when they retire, a slightly better pension. I could give figures but I will leave that until we get to committee.
That increase in benefit which will be there for civil servants who are going to retire in the next year or two will grow year by year until the tenth year. Those who have precisely ten years to go, when they retire, will get the maximum extra benefits, the marginal benefit that is provided under this formula.
After the tenth year has gone by employees who are still in the service will find that the extra benefit they will get will start to decline. I do not mean just that the extra increment will be less but rather that the total extra benefit that employees will get if they work 11, 12, 20 or 25 years will actually be less than it would be if they were ten-year employees under both plans.
Pensions
When the point is reached where an employee has his full 35 years in he will find that he is just about even. In terms of percentages he will get out of the Canada Pension Plan 25 per cent of his year's maximum pensionable earnings, which at the present time would be $1,250, but in the terms of this bill he will lose 24J per cent of those same earnings. So at the 35-year point there is practically nothing of the extra benefit left, and the retiring civil servant, though he was in two plans, will be getting exactly the same pension within a few cents that he would have got if there had not been the Canada Pension Plan at all.
I just do not think that is good enough. That is why I said a few moments ago that 35 years from now there may well be another Stanley Knowles complaining about the unfair treatment accorded to some of our civil servants because of the nature of this integration formula.
I think that stacking, or decking would have been better. But if we are dealing with a plan where the rates of contribution are higher than in some other plans, a compromise would have been in order. It seems to me that this is not the best kind of compromise that could have been worked out, and I deplore the unevenness of the extra benefits. It starts in the first year and grows up to 10 years and then goes down from 10 years to 35 years.
I also want to urge that when we get into committee on the bill a very clear statement be made on the position of employees who are entitled to retire before they are 65 years of age. There are employees who get their full 35 years of service in at age 60 or 62. Under the Public Service Superannuation Act as it now stands they can retire and draw their full pension. Many persons have come to me about this and I have given them my assurance, an assurance that I am satisfied with, that they will not suffer any loss in their pension under the Public Service Superannuation Act. If I read Bill C-193 correctly, that is the case.
But will they get anything extra? The present Solicitor General, when he made his statement as parliamentary secretary to the Minister of Finance on November 18, 1964, was quite specific that it would still be possible for people to retire early and get the same public service pension, getting the additional Canada pension when they reach age 65. Because the Canada Pension Plan is so worked out that if you do not have any

June 13, 1966
Pensions
earnings between age 61, 62, say, and age 65-there is a formula under which the benefit is reduced-I can see possibilities of some people drawing the full public service pension at age 60 or 61 and finding when they get to age 65 that what they have left is not worth very much. I recognize of course that there is a clause in the bill that is supposed to provide protection in this sense, because it says that if that kind of complication produces a pension of something less than would have been the case if there had not been the Canada Pension Plan, there will be an adjustment.
It seems to me that in this whole area there is lacking the kind of clarity we ought to have. I am also surprised that if a person, for the reasons I have given, finds himself in a position of having to take a joint pension which is less than would have been his public service superannuation, in order to bring it up to its original level he has to apply for it. It seems to me something like that ought to be completely automatic.
I am listing a few of these things, Mr. Speaker, to indicate matters that in my view ought to receive attention and also to indicate the reason for my basic contention that we ought to take a pretty hard look at this piece of legislation for two reasons, to make sure that it gives the best possible deal to our civil servants and to make sure that we are setting a pattern that will be fair to employees of private industry in cases where private industry copies this plan.
I have already made passing reference to some of the things that are in the bill which are approved by all of us. Perhaps I can list them. We are glad to see that the armed forces and the Royal Canadian Mounted Police are brought under the provisions of the Canada Pension Plan. Since they have been brought under those provisions, provisions for integration similar to those of other government employees have to be made.
I welcome most strongly the portions of this bill that extend the principle of portability. I go all the way with the hon. member for Carleton. In fact, I go farther than he does with the suggestion that there should be complete portability of all pension plans in this country, and I regret that it has taken the government so long to act on the promise made by the former minister of finance on December 18, 1964, that there would be legislation providing for the regulation of pension plans that come under federal jurisdiction.

I hope the day will come when there will be the kind of over-all legislation that will ensure complete portability of pensions and ensure the possibility that our people generally can build up and enjoy decent pensions when their time comes to retire. Even though I regret that we have not gone as far as we should, yet I am glad to see a further extension of something that is already there in the government service, the right of portability, the right of people to move in and out of the public service, into certain other kinds of employment, and carry their pension rights with them.
I welcome too the increase in the amount of death benefit payable to public servants and I welcome the provision that protects the pension rights of the Post Office employees who were on strike last summer.
[DOT] (9:20 p.m.)
Now, Mr. Speaker, I must ask your indulgence for a moment to draw the minister's attention to the fact that the short title of this bill is "The Statute Law (Superannuation) Amendment Act, 1966". If this title describes the bill correctly as one which in an omnibus way amends the various statutes which are on the books having to do with public service pensions, then this was an appropriate opportunity for the minister to have done something about the pensions of retired civil servants. He could have done it by including in this statute amendments to the Public Service Pension Adjustment Act, or if he does not like that act because it was brought in by another government he could have brought in his own measure.
The minister is conscious of the fact that this problem exists. It is on his doorstep as, I hope, it is on the doorstep of every member of the government. Indeed, tonight he gave an assurance to retired members of the civil service that their own pensions would not be reduced or interfered with because of this legislation and that none of the money they had paid into the public service superannuation fund would be used for any other purpose than to pay their pensions.
I submit that if the Minister of National Revenue and the hon. member for Carleton can talk about these things, so can I.


Edgar John Benson: On a point of order, Mr. Speaker, the only reason I mentioned these matters was to answer two questions in order that the hon. member for Winnipeg North Centre who raised them last week might not lose his sleep tonight worrying about them.
June 13, 1966


Stanley Howard Knowles: I am sure the minister realizes that is about the weakest point of order he has ever raised. His reference to this subject is an admission on his part that this is a matter of concern. Mr. Speaker, it is not necessary for me to take time on this subject. The pages of Hansard are replete with my pleas on behalf of retired civil servants. I express my regret in the strongest terms I can that the government has ignored this golden opportunity. We are dealing in this bill with the whole question of pensions. We are trying to right wrongs, to provide greater portability, to bring the provisions of these various acts in line with the Canada Pension Plan. We are trying to improve the situation with respect to what are sometimes called deathbed marriages. It used to be that if a man got married three or four years before he died the pension of the widow was reduced accordingly. Now a man can marry and die within a year and even then his widow may not suffer provided the minister is satisfied that the husband was not supposed to die within a year.
After all we have said tonight about the complexities of this measure and its detail, I think the government and those who drafted this bill are to be commended on having taken this opportunity to straighten out many anomalies and make changes of a word here and there to clarify provisions in the legislation. But why, when the government was doing these things, did it not think to deal with this important question of adjusting the pensions of civil servants already retired?
I join with the hon. member for Carleton in expressing the hope that some way can be found for us to study these 94 clauses in a manner appropriate to this type of bill. I make no threat about the length of time this is going to take. Common sense tells us it will be better for half a dozen or 15 of us to sit down in a room somewhere with two or three civil servants

we know the names of those who must have drafted this bill and we know how familiar they are with this subject-who could go over it with us. This would be far better than trying to deal with these complicated clauses here in the committee of the whole. After all, we are not likely to get second reading in the 32 minutes between now and ten o'clock, so there could be consultation on this point.
I commend the government on a piece of legislation which carries out many of the things promised by hon. gentlemen opposite. I regret it denies civil servants the full benefits
Pensions
of both plans; maybe we could deal with this at some other stage of the legislation. I hope that as a result of discussing this question the whole idea of improving pension arrangements, increasing portability and building pensions up to a point where all Canadians can enjoy decent retirement will grow in the minds of members of parliament and of the population generally until we make still further progress in this important field.


Richard Albert Bell: I rise on a question of privilege. When I was speaking earlier with regard to the reduction of pensions for members of the armed forces the Minister of National Revenue interrupted to indicate I was not correct when I said he had promised to make a statement in relation to this matter on second reading. He told us he had promised to make it on a clause of the bill. The minister is right and I am wrong, and I want to make amends to him and say that if I had understood correctly what he had said my strictures would have been even more severe.


Edgar John Benson: I appreciate the hon. member's apology and the fact that he has admitted he was wrong.
[DOT] (9:30 p.m.)


Charles-Arthur Gauthier: Mr. Speaker, just a few words to congratulate the minister for bringing this resolution before the house. I feel the purpose of the minister is praiseworthy as he is endeavouring to merge all those plans into a correlated and better coordinated whole. Indeed, a look at the purpose of this bill reveals that it is fourfold:
(1)	to provide, because of the contributions required under the Canada Pension Plan, for a reduction in the contributions required to be paid to certain funds ... by Parliament-
(2)	to extend the . . . provisions of certain of these plans;
(3)	to raise the limit on the amount of the supplementary . . . benefit payable-
(4)	to make amendments of a general nature to certain of the Acts establishing these plans-
What we are most interested in, Mr. Speaker, is the matter of portability, as Quebec has its own pension plan. It is therefore certainly gratifying for those who will have to move from one province to another that they will be able to benefit from these pension plans, just like all other Canadian citizens, and that they will not lose such contributions as they have paid to the provincial pension plan. I trust the federal government will reach an understanding with the provinces in this regard.

June 13, 1966
Pensions
We have been hearing tonight about the complexity of this bill. No wonder, when we have before us a bill containing 94 sections.
I have been listening to the hon. member for Carleton (Mr. Bell) who is an expert on pension schemes; that is what he tells us, anyway, I do not know him personally but he seems to know his business. If he finds that Bill C-193 is complicated, you can imagine, Mr. Speaker, what people like us who are not insurance experts, will think of it. There is much to read and to consider in this bill, and it is impossible to try to consider it in committee of the whole. This bill must absolutely be referred to the special committee on the public service of Canada so that it may be considered, gone over with a magnifying glass, and especially so as to enable those who are interested, that is the employees, to have an opportunity of stating their opinion, since they are the ones to benefit from this bill.
It is imperative that pensioners and future pensioners be allowed to appear before the committee to enable the members who will have to vote on this bill to discuss it frankly and sincerely in committee, to improve it as much as possible and to come up with a piece of legislation as perfect as possible.
Thus, the government, the last interested party who will be called upon to vote on the third reading of this bill, will not be voting blindfolded. I believe this is also the opinion of the Minister of National Revenue who certainly does not intend to dictate an act to future pensioners, who wants a democratic act. In order to make this act democratic, it is imperative that after second reading, it be referred to the joint committee on the public service of Canada.
This is why, Mr. Speaker, I took part in the debate. I have already stated that I do not want us to drag on the introduction of resolutions. We have many opportunities to speak, especially on second and even on third reading. This is why, Mr. Speaker, I do not wish to delay the house further.
I hope that the motion on second reading will be passed as soon as possible, in order that the bill may be referred to the committee.
1English1


Mr.   J.-T. Richard@Ottawa East: Mr. Speaker, as a member from the city of Ottawa I have been interested for many years in matters affecting the civil service and I would
[Mr. Gauthier.)
like to say a few words on this bill. As members we want to act fairly toward civil servants. For that reason, when an important bill like this comes before us I would like to feel that all of us understand the effect of the legislation.
I want to congratualate the minister for introducing this bill. It is one of four affecting civil servants. I know there is a great deal of work to do in committees, but this is a complex bill. Its main principle deals with integration Like the hon. member for Winnipeg North Centre (Mr. Knowles) I have had doubts with respect to the benefits which integration will give to civil servants, and when the Canada Pension Plan was introduced I hoped it would contain some extra benefit for civil servants in addition to their superannuation plans.
Our duty in this chamber is to see that all legislation affecting civil servants serves as a model. We should not be followers but should be providing a model for others. At this stage I do not want to discuss the various features of the bill, but I would not like anybody to say I was recanting speeches I have made in this house since 1948 on the importance of the fact that governments should adjust the pensions of retired civil servants, as has partly been done in the old country and more recently in the United States.
I rise at this time to tell the minister that I am in favour, if it is at all possible, of referring this bill to a special committee so that it can be dealt with expeditiously or else referring it to the special joint committee on the public service.


Mr. Robert McCleave (Halifax):: Mr. Speaker, I would like to add my support to the eloquent plea made by the hon. member for Carleton (Mr. Bell) and others who have participated in the debate that this bill and its subject matter be referred for study to some committee outside this chamber.
The bill comprises 72 pages as well as explanatory material on opposite pages. It contains 94 clauses and amends seven acts. I am not a Kingston accountant, a Philadelphia lawyer, a Winnipeg North Centre printer or preacher; I am a Halifax lawyer. Two members of that breed have occupied the highest positions in government in this country, and I am sure if they were confronting the problem we are confronted with they would be whirling in their graves because this is a very large and intricate piece of legislation and should be dealt with by a committee whose
June 13, 1966

members could come to grips with experts and expert opinion.
In saying this I take nothing away from the Minister of National Revenue (Mr. Benson). I think any answers he would give us in the house would be as honest and fair as answers could be to the utmost of his ability, but the fact is that he is separated, except for some fleet-footed page boys, from the officials in the gallery who could go into some of the fine points of the legislation. If we referred the matter to a committee it would be possible to have those experts there for crossexamination. It would also be possible to get the views of the civil service associations and other groups affected by this omnibus bill which, as I have noted, amends seven acts.


Edgar John Benson: Mr. Speaker, if you would allow me to rise on a point of order I should like to say that I am completely in agreement with the purport of what my hon. friend is saying and, provided I am given the opportunity, I propose to move that this bill be referred to a committee for detailed study.


Robert Jardine McCleave: Mr. Speaker, when Sir
Robert Borden and Sir John Thompson got answers as eloquent as that to their pleas they had the sense to move on to other subjects, but I think I should commend the minister for giving us this information at this time.
[DOT] (9:40 p.m.)
I conclude by complimenting the minister on the changes that will be made in relation to wartime service. I support the criticism so well put by the hon. member for Carleton to the effect that superannuates' problems are not being dealt with at this time. I wish to thank the minister for the information he has given the house and I will not go over that ground again. I did have some thoughts as to what it would be like to have a future Stanley Knowles in this chamber 25 years from now but I will spare the house that as well.


Mr. Deputy Speaker:: I must advise the house that if the Minister of National Revenue speaks now he will close the debate.


Edgar John Benson: Mr. Speaker, I rise only to mention very briefly this simple little bill with 94 clauses which amends several acts and to repeat that this is a statute amendment act rather than an omnibus bill.
Pensions
Having listened to hon. members I think it might be useful if this bill were sent to a committee for several days so that members of the civil service and representatives of civil service associations may have an opportunity of appearing to express their views. I have been particularly moved to make this suggestion tonight by one of the civil service associations, which today indicated it would like to make representations. We as the government want them to have every opportunity to do so.
If we move through second reading I will then move by unanimous consent that we send this bill to the special joint committee on the public service for a period of ten days so that all members may have an opportunity of questioning officials and thus allowing me to get off the spot. In this way civil service associations will also have an opportunity to make representations.
Motion agreed to and bill read the second time.



REFERENCE OF BILL NO. C-193 TO SPECIAL JOINT COMMITTEE ON THE PUBLIC SERVICE

Edgar John Benson: That Bill C-193 be referred to the special joint committee on the public service; and
That the said committee report the bill back to the house on or before Thursday, June 23, next.


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


Gilles Grégoire: Mr. Speaker, we would be ready to pass that motion, but our group has no representative on the committee of the public service of Canada made up of 24 members. When committees were set up, we were not allowed to have a member on each committee.
Now that an important matter will be studied, a group of seven members will not have a single representative on that committee. I wonder if the minister would have a suggestion to make in that connection, so that we would have a representative.
We all know that committees find it hard to have a quorum-they cannot have a quorum when it reaches 13. Therefore, I wonder if the minister would object to the appointment of a 25th member during the consideration of that bill.

June 13, 1966
Bankruptcy Act
[English1


Edgar John Benson: Mr. Speaker, the committee has already been constituted but I will be pleased to take up the matter of constitution with those involved. I am sure we will want to allow the hon. member for Lapointe all possible representation on this committee.


[Stage Direction]
Motion agreed to.

Edgar John Benson: That a message be sent to the Senate to inform that house that:
Bill C-193, an act to amend the Public Service Superannuation Act, the Canadian Forces Superannuation Act, the Royal Canadian Mounted Police Superannuation Act, the Diplomatic Service (Special) Superannuation Act and the Intercolonial and Prince Edward Island Railways Employees' Provident Act to provide for a reduction in the contributions required to be paid under those acts as a result of the implementation of the Canada pension plan and for the correlation of the pensions or annuities payable under those acts with the pensions payable under the Canada pension plan; to extend the portability provisions of certain of the plans established under those acts; to raise the limit on the amount of the supplementary death benefit payable in respect of persons employed in the public service and members of the Canadian forces; and to make amendments of a general nature in connection with the administration of those acts and of the Defence Services Pension Continuation Act and the Canadian Corporation for the 1967 World Exhibition Act, has been referred to the special joint committee on the public service, with the proviso that the said bill be reported back to the house on or before Thursday, June 23, next.


[Stage Direction]
Motion agreed to.


George James McIlraith: the second reading of Bill No. S-17, to amend the Bankruptcy Act.


Hon. L. T. Pennell (Solicitor General):: Mr. Speaker, I hope this will be one of those non-controversial bills which fall to the law officers to introduce from time to time. In the unavoidable absence of the Minister of Justice (Mr. Cardin) the duty to explain it devolves upon me this evening. I know I shall best suit the inclination of the house if I discharge my duty with a few simple words. I can assure the house that at the committee stage the minister will carry the bill.

A complete revision of the Bankruptcy Act being still some time away, this bill is an interim measure amending the Bankruptcy Act to provide remedies to some of the most urgent areas of complaints. The amendments that have been incorporated in the bill may generally be grouped under six different headings:
1.	More adequate means of dealing with frauds connected with bankruptcies will be incorporated in the act and it will also be possible to disseminate information relating to previous bankruptcies so that prospective creditors may better judge the credit rating of their would-be customers.
2.	It will be possible for the court to review transactions which would not come within what may be called moral business practices.
3.	The provisions relating to a proposal made by an insolvent person will be tightened to afford creditors better protection and prevent a proposal from being used as a stalling device to permit a debtor to dissipate his assets.
4.	Bankrupts will be required to deposit with the trustee, for the benefit of their creditors, a certain portion of their salaries, wages or other remuneration.
5.	Certain of the provisions of the act dealing with offences by trustees will be expanded.
6.	A bankrupt corporation will be prevented from applying for a discharge.
The new section 3A of the act will give the Superintendent of Bankruptcy adequate powers to make any inquiry or investigation that may be necessary to expose frauds or other criminal offences relating to estates in bankruptcy that otherwise would not be revealed.
The bill also provides that the trustee will file with the Superintendent of Bankruptcy, in respect of each estate, a report setting out the name of the bankrupt and, where the bankrupt is a corporation, the name and addresses of the directors and officers of the corporation and, when applicable, the names of the persons controlling the day-to-day operations of the bankrupt, as well as the trustee's opinion whether the deficiency between the assets and the liabilities of the bankrupt has or has not been satisfactorily accounted for and, finally, the probable causes of the bankruptcy. The information contained in this report will of course be most valuable to the superintendent in assessing whether the bankrupt's affairs should be investigated by him or not.
June 13, 1966

A separate report setting out only the name of the bankrupt and the names and addresses of the directors and officers of the corporation, where the debtor is a corporation, as well as the names of the persons controlling the day-to-day operations of the bankrupt, will also be required to be filed by the trustee with the official receiver to permit the dissemination of information relating to previous bankruptcies so that prospective creditors may be in a position to better judge the credit rating of their customers.
[DOT] (9:50 p.m.)
This bill will incorporate in the Bankruptcy Act the technique used in income tax matters. It will provide that where a person has sold, etc., or purchased, etc., property or services to or from another person with whom the first mentioned person was not dealing at arm's length, and within 12 months of such transaction the first mentioned person becomes bankrupt, the court upon application of the trustee will have the power to review the transaction to inquire whether the consideration was conspicuously excessive or inadequate, and if so give judgment to the trustee for the difference between such consideration and the fair market value of the property or services. These amendments will also provide that where a corporation within 12 months preceding its bankruptcy has redeemed shares or granted a dividend when the corporation was insolvent or that rendered the corporation insolvent, recovery can be had against the directors or against certain of the shareholders of the bankrupt corporation. Other amendments will also be made to other provisions of the act to restrict the rights of creditors that are related to the bankrupt.
Another important amendment will eliminate the possibility of abuses by debtors by giving the creditors, under the direction of the court, more control over the assets of the debtor. These amendments will also provide that if the proposal is not accepted by the creditors or by the court, the debtor will be deemed to have made an assignment on the date the proposal was originally filed with the Official Receiver. Likewise, a proposal that will not be followed through by the debtor will have the same effect as if the debtor had made an assignment in bankruptcy.
Under another amendment the trustee will have to see that the debtor deposits for the benefit of his creditors a certain portion of his salary, wages or other remuneration. It is thought that these provisions will greatly
Bankruptcy Act
help to correct some of the abuses of the bankruptcy process, especially by preventing the obtaining of a too easy discharge from personal debts through bankruptcy proceedings.
The purpose of another amendment is to compel a bankrupt corporation to make a proposal for the benefit of its creditors should the shareholders wish to use a tax loss or stock exchange listing to their own advantage. These amendments will also prevent a corporate shell from being used to obtain further credit to the detriment of new creditors.
Dealing with offences by trustees, the main effect of the amendments in this bill is to make it an offence for a trustee to receive any remuneration or gift other than the remuneration payable out of the estate and to make any kind of arrangement for the splitting of his fees with a solicitor or other person.
I now wish to say just a word or two about the summary administration provisions in the bill. Over a period of years certain abuses have been disclosed in the administration of estates under the Bankruptcy Act and these abuses are attributed in considerable measure to the summary administration provisions. This bill therefore amends the Bankruptcy Act by repealing sections 114 and 115 which contain the summary administration provisions and re-enacting them with certain deletions and changes.
For example, the provision to which I have already referred whereby security is not required under the present act to be deposited by a trustee in respect of each summary administration estate is changed to provide that such security is not required "unless directed by the Official Receiver". The changes made in sections 114 and 115 eliminate or modify a number of the summary administration provisions in order to provide for the stricter administration of the estates to which the summary administration procedure applies.
Finally, Mr. Speaker, a word about the orderly payment of debts. An act of the province of Alberta, called the orderly payment of debts act, was held by the Supreme Court of Canada to be ultra vires the provincial legislatures as impinging upon the federal jurisdiction over bankruptcy and insolvency conferred by section 92(21) of the British North America Act upon the federal parliament. Both Manitoba and Alberta then requested that federal legislation be enacted

June 13, 1966
Bankruptcy Act
of the same character as the provincial legislation. The present bill enacts a new part of the Bankruptcy Act, part X, which closely follows the provincial legislation which was declared ultra vires.
Mr. Speaker, I respectfully commend this bill to the house.


Erik Nielsen: Mr. Speaker, the situation confronting the country with respect to bankruptcies, and particularly fraudulent bankruptcies, is one which I think can be properly termed an emergency. Our attitude on this side of the house is that we want to do everything possible to facilitate the early passage of the legislation. We will have some suggestions to make but in order to expedite the business of the house and the early passage of the legislation we are prepared to allow second reading tonight and advance to the committee stage assuming that the bill will come before the house at the earliest possible moment again, at which time the general and specific remarks can be made on the relevant clauses of the bill.


Stanley Howard Knowles: Mr. Speaker, we are prepared to join in the suggestion that this bill be given second reading tonight, but I hope that if this happens and we get into committee of the whole the government will be willing to let the bill stand at that point so that any speeches that might have been made on second reading can be made in committee of the whole.


Gilles Grégoire: I agree, Mr. Speaker.
1English]


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Rinfret in the chair.
The Deputy Chairman:: House in committee of the whole on Bill No. S-17, to amend the Bankruptcy Act.


Erik Nielsen: Mr. Chairman, may I call it
ten o'clock, please?
Progress reported.



BUSINESS OF THE HOUSE

George James McIlraith: Mr. Speaker, for tomorrow we propose submitting to the house for its consideration item No. 66 on the order paper, the resolution that it is expedient to introduce a measure to provide for the establishment of a health resources fund; then

item No. 45, the resolution that it is expedient to introduce a measure to be known as the Canada Assistance Plan. Then we propose to move into consideration in committee of the whole on the bankruptcy bill to which we have just given second reading.
[DOT] (10:00 p.m.)


Gilles Grégoire: Mr. Speaker, I should like to ask the government house leader when the house will consider Bill No. 194? All sections of that bill, except section 4, were passed the other day, and the hon. member for Ontario (Mr. Starr) had then requested that section 4 be allowed to stand until early this week.
Now, early this week means today or tomorrow, and in outlining the business of the house just now the minister said nothing about that bill. I would like to know when it will come before the house.


George James McIlraith: Yes, Mr. Speaker, I hope later in the week on the return of the Secretary of State.



PROCEEDINGS ON ADJOURNMENT MOTION

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

Herbert Wilfred Herridge: I rise this evening to bring to the attention of the house an injustice which I consider a constituent of mine, Mr. Charles Ghirardosi, has suffered as a result of having won his case before the Supreme Court of Canada without counsel.
Mr. Ghirardosi's property in Trail, B.C. was expropriated by the British Columbia highways department in 1961. He was told to go to arbitration and the decision of the arbitration was not in his favour. The award which he sought was refused and he had to pay the court costs. He then went to the Supreme Court of British Columbia which set aside the decision in favour of the British Columbia highways department. Nevertheless, again Mr. Ghirardosi had to pay court costs as well as legal expenses to his counsel. Then the minister of highways of British Columbia, Mr. Gaglardi, appealed the decision of the Supreme Court to the Court of Appeal of
June 13. 1966

British Columbia. The Court of Appeal reversed the decision of the Supreme Court of British Columbia and there again my constituent, Mr. Charles Ghirardosi, had to pay the court costs and the expenses of his counsel.
Continuing to seek justice in this case he came to Ottawa with a view to bringing his case before the Supreme Court of Canada. Before leaving Vancouver he asked a solicitor to represent him. The solicitor told him he would not take the case without receiving $12,000 in cash before even starting. Another solicitor offered to undertake this work for $5,000 and still another one demanded $4,000. Finally a solicitor in Ottawa offered to render his services for $850. Mr. Ghirardosi did not have this sort of money so, after thinking it over and reading the Supreme Court act, he decided to appeal his case in person before the Supreme Court of Canada without counsel.
Mr. Ghirardosi is a long-time resident of the Kootenays. He does not have a great deal of formal education but he has a sharp mind. He appealed to the justices of the Supreme Court and obviously convinced them that he had a sound case. The justices gave a judgment which I will read in part as follows:
I would allow the appeal, set aside the judgment of the Court ol Appeal and restore the order of Collins J. The appellant will recover from the respondent his costs in the Court of Appeal and in this court such costs as are taxable in view of the circumstance that he conducted the appeal in person.
Well, Mr. Speaker, the circumstances are that because this man did not have legal counsel all he could possibly obtain was some $100 or so which he paid out for stenographic help and things like that. He is not allowed his costs of coming from Trail to Ottawa, the lost time from his employment, his board and lodging and so on. According to the act, if he had had counsel all these costs would have been allowed. Therefore he considers that he has suffered an injustice in this case.
Naturally, Mr. Speaker, he discussed this matter with the member for Kootenay West. Anyone in that constituency who has problems relating to the parliament of Canada and a great many other matters besides discusses them with the member for Kootenay West. I have a wide range of interests. This man also went to see the hon. member for Red Deer and discussed the problem with him. He had heard that the hon. member was interested in this sort of thing, having said in the house on several occasions that he was
DEBATES	6363
Proceedings on Adjournment Motion interested in the appointment of an ombudsman or parliamentary commissioner to deal with injustices.
On that account, Mr. Speaker, the hon. member for Red Deer introduced the other day a bill to amend the Canadian Bill of Rights. The purpose of this bill is to provide that there should be no discrimination, by reason of one's belonging to a particular profession or trade or by reason of one's education, in respect of the enjoyment of the basic rights and freedoms recognized by the Canadian Bill of Rights. Finally, the bill provides that each individual shall have the right of access to all courts and tribunals, the right to appear in person before those courts and tribunals and the right to handle his own case. Furthermore, if a decision is rendered in his favour he should be reimbursed his costs, disbursements and reasonable expenses in the same manner as if he were a lawyer handling his own case. This is to emphasize the fact that a private individual should be entitled to obtain full justice in handling his case personally.
I have discussed this matter with Mr. Ghirardosi and other persons, and I have in mind the introduction of a bill to amend the Supreme Court of Canada Act and the rules by adding to section 48 of the act a subsection 2 which would read as follows:
When a party is awarded the costs, he will be entitled to such costs and disbursements with full equality, regardless of whether he has acted in person or through a lawyer.
That may not be worded quite correctly but the intent is there. I have brought this matter to the attention of the house, and I presume that under these circumstances the Solicitor General in the absence of the Minister of Justice, who I know is unavoidably absent this evening, will bring it to the attention of the minister to see whether something can be done to remedy an obvious injustice to a Canadian citizen.


Lawrence T. Pennell: Mr. Speaker, I know the hon. member will not take me amiss if I say that as a bona fida member of the legal profession who for the moment is debarred from private practice I sympathize with the point he has raised. I have listened attentively to the grievance he has aired and he can be assured that I will bring the matter to the attention of the Minister of Justice.
June 13, 1966
6364	COMMONS
Proceedings on Adjournment Motion



SPORTS-HOCKEY-POSSIBLE CONTRAVENTION OF COMBINES LEGISLATION

Stanley Ronald Basford: Mr. Speaker, in the overtime period I should like to discuss hockey, particularly professional hockey. I wish to discuss not the players who have played with distinction and brought such distinction to themselves and their sport but the owners of the franchises and the clubs.
Last February 25 I introduced in the house a bill to bring the operation of professional sporting leagues within the purview of the Combines Investigation Act, following the action of the National Hockey league in refusing a franchise to the city of Vancouver for a team to participate in Canada's national game. At that time I said that the amendment I was introducing included all professional sport. However, it is immediately directed at the National Hockey League whose president, Mr. Clarence Campbell, made it clear its owners are interesed only in their own welfare and not in the public interest. This bill would make them recognize their obligations to the public and to Canada whether they wanted to or not.
[DOT] (10:10 p.m.)
We must recognize that professional sport in this country and in North America is now very big business. One need only look at the innumerable newspaper clippings on the subject to recognize that. An extract from Maclean's magazine of November 15, 1965, reads:
You can't lick it, you can't join it-it's the sports establishment. It runs sports, sportsmen and (whether they know it or not) the spectators. It's snobbish and arrogant, with rites, rituals and rules -mostly to keep outsiders out. It's a moneyed tyrant with all the appeal of an offside call on a scoring play. So what else is new? The fans actually seem to like it!
Referring to the club owners and the franchise owners it is my considered opinion that there is need for a parliamentary inquiry into the whole operation of professional sporting activities. I have before me a copy of the Congressional Record of the United States where this same subject has come up before various committees of Congress. They have attempted to draft laws to deal with the situation in the United States. I think we in Canada also need a full scale parliamentary inquiry into professional sport in this country.
I welcomed very much the announcement the other day by the Minister of National Health and Welfare that there would be a wide-ranging study into hockey in Canada,


including the relationship between professional and amateur clubs and the impact of hockey on education. I think such an inquiry is extremely important so that the game in Canada can develop in the right way.
It seems to me that an inquiry into hockey is not sufficient for our needs. I earnestly hope that the minister will also consider my bill and the possibility of bringing the operation of the National Hockey League within the purview of the Combines Investigation Act. I think the committee making the inquiry should look into that. I think the committee ought to make a wide-ranging inquiry into the whole operation of professional hockey in Canada.
There is no doubt in my mind that the development of our young athletes and especially the development of amateur hockey players is closely bound up with the operation of the professional leagues. I think many things go on in any professional league that adversely affect hockey in Canada and amateur hockey players.


Mrs. Margaret Rideout (Parliamentary Secretary to Minister of National Health and Welfare):: Mr. Speaker, I listened with great interest to the statement of the hon. member for Vancouver-Burrard (Mr. Basford). By way of personal note may I say that I am sure no member of this house enjoys our national game more than I do.


An hon. Member:: No commercials.


Margaret Isabel Rideout: When hockey night in
Canada comes along I along with other Canadians am in the forefront enjoying our national sport. No doubt my hon. friend will recall that the Minister of National Health and Welfare announced some two weeks ago the setting up of a subcommittee of the National Fitness and Amateur Sports Council to study all aspects of our national game.
The announcement was greeted with a great deal of enthusiasm not only by officials of the Canadian Amateur Hockey Association, who were fully briefed in advance of the announcement, but by officers of the National Hockey League as well. I think there is a sincere desire on the part of all Canadians involved in hockey both at the official and player level to find answers to some of the important questions facing this great sport.
The subcommittee was established with the following terms of reference: First, to investigate the purposes, structure and functions of the CAHA and other groups as the sports governing bodies for amateur hockey; second,
June 13, 1966

to identify the problems facing amateur hockey and, third, to make recommendations to improve the government of amateur hockey and to aid in the solution of problems revealed by this detailed study. Other areas such as the relationships between professionals and amateurs, conflicts between hockey and education, playing rules, player drafts, Canadian participation in international competition and the role of Canada's national hockey team will also be discussed and gone into in detail.
While I cannot assure the hon. member that the contents of his bill will be discussed by members of the subcommittee I can repeat the words of the Minister of National Health and Welfare when he was asked a similar question. His answer was to the effect that the terms of reference are sufficiently broad for all matters, including the one to which the hon. member for Vancouver-Burrard has referred, to be gone into. If members of the subcommittee find it necessary to make comments on the subject of his question there is no reason why they cannot. I can assure the hon. member that any suggestions the subcommittee makes will be given very detailed consideration by the department and the government.
I am sure there is no reason, Mr. Speaker, why copies of the hon. member's private bill cannot be circulated to members of the committee and I would be more than happy to put the suggestion before the Minister of National Health and Welfare (Mr. Mac-Eachen) who has taken a very active interest in these matters since he took over the portfolio late last year.


Stanley Ronald Basford: On a question of privilege-*


The Acting Speaker (Mr. Rinfrel):: I regret to interrupt the hon. member but the time allotted for the discussion of the subject of hockey has elapsed. The game is over.


Stanley Ronald Basford: On a question of privilege-


The Acting Speaker (Mr. Rinfret):: I regret to interrupt the hon. member but there is no question of privilege arising at this time.



AGRICULTURE-CHAROLAIS CATTLE-REQUEST FOR PERMISSION TO EXPORT

Mr. D. R. Gundlock (Lethbridge):: 
Hon. J. J. Greene (Minister of Agriculture):: Mr. Speaker, I thank the hon. member for drawing this very important matter to my attention and to the attention of the government. First of all I would point out that in my view there is a very considerable difference respecting those cattle which were imported last year, apparently without restriction. No restrictions were made at the time the importations were made and the permits were granted.
Last year was the first year these cattle were ever imported and I think it took a considerable amount of effort on the part of the past minister who introduced this program to effect this importation. In so far as the terms that were granted are concerned, there was no restriction as to what could be done with these cattle with regard to them remaining here or being dealt with as the owner saw fit.

I may point out that other kinds of cattle are imported without restriction as to what may be done by the importer once they are clear of the station. The hon. member has made some valid points and in respect of this year's program I will take them into consideration. I do not think we can or should legislate retroactively. We on this side of the house, like other hon. members, are concerned that we do not interfere with the satisfactory arrangements we have at our border. We now have a very happy situation in that we have in essence established a North American market in respect of our cattle. Other types can be sold in the United States and vice-versa, and we would be very chary about doing anything that would interfere with this situation because I think this kind of market is in the best interests of our cattle producers.
In respect of this year's operation I quite concur that it might be made a condition of the right to bring cattle in that the cattle remain in Canada for as many years as deemed advisable. The members remarks in this regard are worthy of consideration and I assure him that when we are evolving this year's policy we will give consideration and take cognizance of them and the two precedents he brought to my attention with which I was not familiar. I thank him for that information.
Motion agreed to and the house adjourned at 10.30 p.m.

Tuesday, June 14, 1966