1967-06-15

[Stage Direction]
Melville C. Germa, Esquire, member for the electoral district of Sudbury, introduced by Mr. T. C. Douglas and Mr. Norman Fawcett.


Mr. C. S. Smallwood (Battle River-Camrose):: Mr. Speaker, I rise on a question of privilege arising out of an article in the Western Producer which carries the headline "Canada a 'stopping place' for U.S. Charolais imports". I will be brief and will not read all the article, but it says in part:
Charolais cattle, owned by United States interests, are quietly being imported into Canada from areas other than France without going through the elaborate quarantine station established in 1965 in Gross lie, Quebec-
Then the article goes on to describe two shipments of cattle to the Grant Campbell farm near Toronto and another to the John Miller farm near Ashburn. These cattle were the property of the union stock yards at Chicago and an Oklahoma syndicate.
[DOT] (2:40 p.m.)
On April 25, Mr. Speaker, I asked the Minister of Agriculture about this matter but he did not have any information. I am a very co-operative and patient member, I hope. I spoke to the Minister of Agriculture, who is also co-operative, and promised to send him this newspaper clipping. On May 3 his executive assistant telephoned our office and we sent this information. As of yesterday, June 14, we had received no answer regarding this serious matter of the United States circumventing Canadian laws to bring cattle into that country. I hope the minister will have his officials look at this serious matter at an early date, and I hope he will take action on behalf of the Canadian cattle industry.



COMMITTEES OF THE HOUSE


[Stage Direction]
Mr. Rosaire Gendron (Riviere-du-Loup-Temiscouala) presented the second report of the standing committee on housing, urban development and public works and asked for the unanimous consent of the house to move concurrence in the said report.
Some hon. Members:: No.


Mr. Speaker:: There is no unanimous consent.
Motion stands.



VETERANS AFFAIRS-FIRST REPORT OF STANDING COMMITTEE

Mr. Gerald Laniel (Beauharnois-Salaberry):: Mr. Speaker, as a result of the serious and expeditious work performed by the committee on veterans affairs, I have the honour of presenting the first report of this committee whereby the estimates of the department are referred to the house for concurrence.



JUSTICE AND LEGAL AFFAIRS-MOTION FOR CONCURRENCE IN FIRST REPORT OF STANDING COMMITTEE

[Stage Direction]
Mr. A. J. P. Cameron (High Park) presented the first report of the standing committee on justice and legal affairs, and asked for unanimous consent to move that the report be concurred in.
An hon. Member:: No.


Mr. Speaker:: There is not unanimous consent.
Motion stands.



HOUSING. URBAN DEVELOPMENT AND PUBLIC WORKS-CONCURRENCE IN FIRST REPORT OF COMMITTEE

Mr. Rosaire Gendron (Riviere-du-Loup-Temiscouala) moved:: That the first report of the standing committee on housing, urban development and public works, presented to the house on Tuesday, June 13, 1967, be concurred in.

June 15, 1967
Criminal Code


Mr. Churchill:: No, Mr. Speaker. I presume this has to do with the reduction of the quorum, is that right?


Mr. Mcllrailh:: No.


Gordon Minto Churchill: Or has this to do with sitting while the house is in session?


Some hon. Members:: Both.


Gordon Minto Churchill: So far as the reduction of quorum is concerned, two or three committees have already stated that-


Mr. Speaker:: Order, please. I understand that is not the report which is before the house. This report from the standing committee on housing, urban development and public works asks whether the committee may be authorized to sit while the house is sitting.


Gordon Minto Churchill: All right.


Mr. Gregoire:: On division.
Motion agreed to on division.
[Note: Text of the foregoing reports appears in today's Votes and Proceedings.]



CAPE BRETON DEVELOPMENT CORPORATION


Hon. Jean-Luc Pepin (Minister of Energy, Mines and Resources):: Mr. Speaker, I should like to table copies of the agreement entered into by the Canadian government and the government of Nova Scotia with regard to the coal problem in Cape Breton.



CRIMINAL CODE


Mr. W. B. Nesbitt (Oxford) moved: for leave to introduce Bill No. C-133, to amend the Criminal Code (control of motor vehicle).


An hon. Member:: Explain.


Wallace Bickford (Wally) Nesbitt: This is similar to a bill I introduced in the last session. It closely resembles legislation which was enacted in the United Kingdom about two years ago, and its purpose is to encourage drivers of motor vehicles who are intoxicated to remove their vehicles and themselves from public highways. [Mr. Gendron.l
Under the law as it stands they may be penalized for doing so. It is my hope that after this bill has been discussed on second reading it will be referred to the committee on justice and legal affairs.
Motion agreed to and bill read the first time.



NATIONAL ANTHEM


Mr. Maurice Allard (Sherbrooke) moved: for leave to introduce Bill No. C-134, to provide a national anthem.


Some hon. Members:: Explain.


Maurice Allard: Mr. Speaker, with a view to avoiding the confusion caused by the adaptation of French and English versions of the national anthem "O Canada", my bill proposes that the Canada Council choose suitable versions to be approved later by the house and the Senate.
Motion agreed to and bill read the first time.
[DOT] (2:50 p.m.)



CAPE BRETON DEVELOPMENT CORPORATION


[Stage Direction]
On the order: Government Notices of Motions:
June 13-the Minister of Energy, Mines and Resources-The following proposed motion:-That the house do go into committee of the whole at its next sitting to consider the following proposed resolution which has been recommended to the house by His Excellency:-
That it is expedient to introduce a measure to establish a Cape Breton Development Corporation to acquire, reorganize and rehabilitate certain coal mining works and undertakings on Cape Breton Island, to conduct coal mining operations in the Sydney coal field and to promote and assist the development of industry on Cape Breton Island to provide employment outside the coal producing industry and to broaden the base of the island's economy; to provide for the administration of the corporation and its initial financial and operating capital requirements including the consideration or compensation established or determined to be payable in connection with the acquisition by the corporation of the said coal mining works and undertakings, the sum of twenty five million dollars for the purpose of reorganizing and rehabilitating the said coal mining works and undertakings and for preparatory work in connection with the conduct by the corporation of coal mining operations, and the sum of twenty million dollars for the purpose of promoting and assisting the development of industry on the island.
June 15. 1967
Hon. A. J. MacEachen (Minister of National Health and Welfare):: Mr. Speaker, by leave we would like to deal with this resolution later this day.


Mr. Speaker:: Is this agreed?


Some hon. Members:: Agreed.


Mr. Speaker:: By unanimous consent Mr. Pepin, seconded by Mr. MacEachen, moves that the house go into committee of the whole later this day to consider this resolution, which has been recommended to the house by His Excellency.


[Stage Direction]
Motion agreed to.


Hon. Mitchell Sharp (Minister of Finance) moved: that the house go into committee at the next sitting to consider the following resolution, which has been recommended to the house by His Excellency:
That it is expedient to introduce a measure to authorize the Canadian National Railway Company to make capital expenditures and to supply the financial requirements ol affiliated companies in amounts not exceeding, in the calendar year
1967,	the amount of $264,800,000, and to make, in the calendar year 1968 prior to the 1st day of July,
1968,	certain capital expenditures, by way of investing in the securities of Air Canada, not exceeding $135,000,000 and to make certain other capital expenditures and enter into certain contracts, prior to the 1st day of July, 1968, for the acquisition of equipment, additions, and conversions not exceeding $94,000,000; to provide for the financial requirements of Air Canada in an amount not exceeding $122,000,000, either by means of loans from Her Majesty to the national company or by means of issues of securities of the national company, authorized and guaranteed as to interest and principal by Her Majesty, the cash proceeds by either method to be used only for the financial requirements of Air Canada, the capital needs of the national company itself being met entirely through the sale of preferred stock to Her Majesty and from reserves from depreciation and debt discount; to authorize Her Majesty to continue to purchase until December 31st, 1968, Canadian National Company 4 per cent preferred stock in an annual amount not exceeding 3 per cent of the gross revenues of the company; to extend until December 31, 1968, the moratorium on interest on the loan of $100,000,000 to the company authorized by the National Railways Capital Revision Act of 1952; to authorize Her Majesty to make loans to the Canadian National Railway Company and Air Canada to meet deficiencies in operating reserves to June 30, 1968, any such loans to be repaid from revenues of the railway company and Air Canada or, if revenues prove insufficient, by subsequent deficit appropriation by parliament.


[Stage Direction]
Motion agreed to.
1543
Inquiries of the Ministry BUSINESS OF THE HOUSE

Mr. Speaker:: Before I call orders of the day may I refer for a moment to the makeup of today's order paper. Acting on the assumption that the resolution concerning the Cape Breton Development Corporation had been set down, pursuant to standing order 61-A, as the first item of government business in this sitting, the order paper does not provide for a private members' hour between six o'clock and seven o'clock p.m. this day.
Standing order 15(4) provides for the suspension of the hour for the consideration of private members' business when a money resolution, pursuant to standing order 61-A, is set down as the first item of government business on a Thursday. Accordingly this day's sitting of the house will be suspended at six o'clock until eight o'clock p.m.



UNITED NATIONS


[Stage Direction]
On the orders of the day:
Right Hon. J. G. Diefenbaker (Leader of the Opposition):: Mr. Speaker, I would direct a question to the Prime Minister. The U.S.S.R. having been prevented or circumvented from effecting a resolution harmful to Israel and the matter now having been put before the secretary general, with a call on the part of the U.S.S.R. for a convening of the general assembly, and the request in this regard having been sent to the various members, what is Canada's reply to this request that the assembly should now be seized of this matter?


Right Hon. L. B. Pearson (Prime Minister):: Mr. Speaker, there are still two resolutions before the security council dealing with the matter to which my right hon. friend refers, and in the past it has been the practice not to refer a matter to the general assembly in special session until it had ceased to be dealt with in the security council. The Soviet union have indicated that if these resolutions were proceeded with, the United States resolution in particular, they would veto them. But pending that, as my right hon. friend has stated, they have asked for a special emergency meeting of the general assembly, a request with which 62 members must agree.
We have received a telegram from the secretary general bringing this matter to our

June 15, 1967
Inquiries of the Ministry attention and asking for our agreement or otherwise. The matter is now under consideration. My own feeling, Mr. Speaker, is that we should not object to a meeting of the general assembly because an objection at this time on grounds of procedure would not delay matters very long. Undoubtedly, from the information we have received, they are going to get 62 affirmative votes. Therefore it would be wise not to object to the matter going before the general assembly, without prejudice to the constitutional correctness of the procedure followed on this occasion.


John George Diefenbaker: Mr. Speaker, might I suggest to the Prime Minister that the answer by Canada should be in the negative, so Canada will make clear to all the world that it will not countenance the kind of attitude toward Israel which the U.S.S.R. has in mind and has shown in the security council in recent days. Would this not be the proper time for Canada to stand up and say we shall not accept this? If 62 other nations agree, well and good, but why should Canada not stand on its own feet?


Lester Bowles Pearson: Well, Mr. Speaker, I do not consider that this would be the situation in respect of a request from the Secretary General to express our views as to whether there should or should not be a special general assembly session. I do not believe the refusal to agree to a meeting of the general assembly would have any bearing on the stand we might take at the general assembly. If we have any views on the matter we can express them before the general assembly.



MIDDLE EAST-REPORTED STATEMENT BY MINISTER RESPECTING PEACE NEGOTIATIONS

[Stage Direction]
On the orders of the day:
Mr. David Lewis (York Souih):: Mr. Speaker, I should like to direct a question to the right hon. Prime Minister, asking him whether the statement by the Secretary of State for External Affairs at the NATO ministers' meeting-and I hope I read it correctly-to the effect that the best way of obtaining peace in the Middle East is to have negotiations between the parties rather than at the United Nations, represents government policy, and whether the Canadian representative at the United Nations has been instructed to follow that policy during discussions there?


Lester Bowles Pearson: Mr. Speaker, the most desirable procedure would be to have direct talks between the parties concerned, to be supplemented by an

international agreement to guarantee the security of countries in that area including, of course, Israel. It is difficult to adopt that procedure when at least one side to the talks is not willing to negotiate with the other side.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. T. C. Douglas (Burnaby-Coquiilam):: Mr. Speaker, I should like to direct a question to the Minister of Industry and Defence Production with regard to the 17 man delegation from Nova Scotia which waited on him and other members of the cabinet yesterday in respect of the steel crisis in Cape Breton, where some 700 men have already been laid off this month and another 400 are to be laid off at the end of this week. I should like to ask the minister whether it is correct that the delegation asked the government to give some financial assistance so that steel could be stockpiled pending the improvement of the steel market, and what reply the government is prepared to give to this request.


Hon. C. M. Drury (Minister of Industry):: Mr. Speaker, in response to the representations made yesterday the concern of the government in respect of the very difficult situation facing the steel producing communities of Cape Breton was expressed. There also were expressions of appreciation of this by the delegation. With regard to the proposal that the government should stockpile soft steel from the output of Dosco in Cape Breton, the delegation was assured that the government would give consideration to this. It was pointed out, however, that a program of stockpiling steel from one company alone would constitute a precedent to which careful consideration must be given before such a program is embarked upon.


Thomas Clement (Tommy) Douglas: I have a supplementary question, Mr. Speaker. May I ask the minister also what reply the government is giving to the appeal from Mr. C. H. Drury, the president of Dosco, that the government request that only Canadian steel be used in public works projects, since this would add some 30 per cent to the amount of reinforced steel used in the four Atlantic provinces which would be available in the Canadian market.


Charles Mills (Bud) Drury: Mr. Speaker, I think perhaps the conclusion drawn concerning the result, if there should be a prescription for the use of
June 15, 1967	COMMONS
Canadian steel, is incorrect. In fact the government of Nova Scotia does now in that province prescribe the use of Canadian steel in provincially financed projects. It is apparently in respect of privately financed projects rather than provincially financed projects that the consumption of imported steel is taking place.


Thomas Clement (Tommy) Douglas: In view of the fact that the appeal by the president of Dosco was to the federal government in respect of federally financed projects, which he says would enable some 30 per cent of the steel requirement in the four Atlantic provinces, which is now being met by foreign imported steel, to be met by Canadian steel, is the Canadian government prepared to accede to this request in so far as the federal jurisdiction is concerned?


Charles Mills (Bud) Drury: Mr. Speaker, I do not think any such request was made by the president of Dosco. He did make a statement to the effect that a substantial proportion of foreign steel was now coming into the Atlantic provinces, and he did quote the percentage mentioned by the hon. gentleman. He has not made such an appeal to the federal government, and I do not think he said that the entire 30 per cent related to government purchases.



REPORTED INFESTATION OF LUMBER EXPORTED TO AUSTRALIA

[Stage Direction]
On the orders of the day:
Mr. A. B. Patterson (Fraser Valley):: Mr. Speaker, earlier I directed a question to the Acting Minister of Trade and Commerce based on a report originating from Sydney, Australia, to the effect that a shipment of lumber had landed in Australia which was infested with insects which could cause millions of dollars of damage in that country, and it was alleged that this shipment came from Canada. Has the minister anything to report in this regard?


Hon. Robert Winters (Minister of Trade and Commerce):: Mr. Speaker, I understand that this report referred only to one ship. We have checked and found that the ship did not load lumber as a cargo in Canada. It did use some lumber as dunnage in Montreal, but I understand it was kiln dried and fumigated in accordance with standard practice. However, the ship did call at several other ports before reaching its destination. The shipping company is aware of this situation and is continuing to check into it, as are we.
DEBATES	1545
Inquiries of the Ministry EXTERNAL AFFAIRS



ASSISTANCE FOR EGYPTIAN SOLDIERS DYING OF THIRST IN DESERT

[Stage Direction]
On the orders of the day:
Hon. D. S. Harkness (Calgary North):: Mr. Speaker, I have a question for the Prime Minister in relation to news reports that several thousand Egyptian soldiers are now dying of thirst in the heat of the desert. This has caused a good deal of humanitarian concern among Canadians. Has the Canadian government made any representations to the government of Israel in regard to saving the lives of these people and, if not, will the Prime Minister do so?


Lester Bowles Pearson: Mr. Speaker, that and other related matters of a humanitarian nature were considered by the government this morning in an effort to see what we might do with the Red Cross as an emergency measure to assist in this situation. We are in touch with other governments, and I will be glad to get in touch with the government of Israel if we have not already done so, regarding the desirability of doing something about this situation at once.



TRANSPORTATION


[Stage Direction]
On the orders of the day:
Mr. J. E. Pascoe (Moose Jaw-Lake Centre):: Mr. Speaker, I have a question for the Minister of Transport. In his absence perhaps I should direct it to his parliamentary secretary. The Board of Transport Commissioners has called a conference in Ottawa for August 1 to be attended by all interested parties regarding proposed railway branch line abandonments. Could the parliamentary secretary explain the purpose of this Ottawa conference?


Mr. Speaker:: Order. I would think perhaps this kind of information should be given on motions rather than by way of an answer to a question at this time.



FINANCE


[Stage Direction]
On the orders of the day:
Wallace Bickford (Wally) Nesbitt: Mr. Speaker, I should like to direct a question to the Minister of Finance. In view of recent complaints that the chartered banks are turning down

June 15. 1967
Inquiries of the Ministry applications for loans under the Farm Improvement Loans Act because of the statutory rate of 5 per cent, will the minister look into this matter as soon as possible and take the necessary remedial action?


Mitchell William Sharp: Mr. Speaker, I do not have the information to which the hon. gentleman refers, but I certainly will be glad to make inquiries.



CRIMINAL CODE


[Stage Direction]
On the orders of the day:
John George Diefenbaker: Mr. Speaker, I should like to direct a question to the Solicitor General relating to the Dorothy Cameron case, in respect of which the Supreme Court of Canada ruled it had no jurisdiction to hear an appeal. There has been widespread criticism of the law in this regard by artistic organizations across Canada, supported by the views expressed in Toronto by the Secretary of State. The reports indicated that the minister intended to look into the matter when she returned to Ottawa, in an effort to make sure that a magistrate shall not have jurisdiction to determine whether art is or is not obscene.
What action has been taken in this regard and does the government intend to bring in an amendment to the Criminal Code to bring this matter up to date rather than leave it in the state it is in today and as it has continued for some years? This has now come to the fore as a result of the supreme court ruling to the effect it had no jurisdiction to determine the matter.


Hon. L. T. Pennell (Solicitor General):: Mr. Speaker, my colleague the Secretary of State has privately expressed views to me concerning the law as it relates to works of art and literary matters. We have also received submissions, one oral and one written, requesting a change in the law in this regard. All such submissions are considered when amendments to the Criminal Code are being considered.


John George Diefenbaker: Is the minister in a position to say whether the government is going to carry out the purport of the views expressed by the hon. lady officially in charge of art in Canada?


Lawrence T. Pennell: I can only say that we will follow the usual course and give serious consideration to all representations made as we review the Criminal Code from time to time.



LABOUR RELATIONS


[Stage Direction]
On the orders of the day:
Gilles Grégoire: Mr. Speaker, I wish to direct a question to the Minister of Labour.
Since the Canada Labour Relations Board was to render its decision on June 12 last about the request of the C.N.T.U. to represent the C.B.C. employees, can the minister tell us if the C.L.R.B. has reached a decision and when it will be made public?


Hon. J. R. Nicholson (Minister of Labour):: Mr. Speaker, I am quite sure that any such decision would have been brought to my attention by this time, if it had been announced, and I have not heard of it as yet.


Gilles Grégoire: A supplementary question, Mr. Speaker.
Could the Minister of Labour tell us if the report of the cabinet committee studying that matter was submitted for consideration by the Canada Labour Relations Board?


John Robert (Jack) Nicholson: No, Mr. Speaker.



INDUSTRY


[Stage Direction]
On the orders of the day:
Mr. Eric A. Winkler (Grey-Bruce):: Mr. Speaker, I should like to ask the Minister of Industry whether, in relation to the recent extension of the designated area program, he considered the strong representations made by the Georgian bay development association regarding the balance of economy in that area?


Mr. Speaker:: Order, please. I would think that question should be placed on the order paper.



CANADA PENSION PLAN

[Stage Direction]
INQUIRY AS TO REFUNDS TO EMPLOYERS On the orders of the day:
Mr. A. D. Hales (Wellington South):: Mr. Speaker, I should like to address my question to the Minister of National Revenue. Has the minister arrived at a satisfactory system or formula whereby employers will be paid back
June 15, 1967

the excess contributions they have made to the Canada Pension Plan, reputed to be as high as $12 million to $14 million?
Hon. E. J. Benson (Minister of National
Revenue and President of the Treasury Board): No, Mr. Speaker.


Alfred Dryden Hales: Will the minister advise the house when he expects to arrive at such a formula?


Mr. Benson:: Mr. Speaker, we are presently compiling information and I cannot give an exact date as to when this will be complete. We require this information in order to consider this matter.



INQUIRY AS TO ACTION TO CONTROL INCREASED NARCOTICS TRAFFIC

[Stage Direction]
On the orders of the day:
['I thank the Prime Minister.']
Mr. Heward Grafftey (Brome-Missisquoi):: Mr. Speaker, I should like to direct a question to the Solicitor General based on a report this week to the effect that there is a heavy increase in drug and narcotic traffic. Naturally we cannot expect an answer in detail, but will the minister assure this house that appropriate action is being taken?


Lawrence T. Pennell: I should like to refer the hon. member to the remarks I made at the opening of the debate on my estimates last week. I said at that time that the R.C.M.P. had reason to believe that traffic in hard narcotics was reasonably well under control, but were not as optimistic regarding soft narcotics, particularly marijuana.



[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: Mr. Speaker, on Tuesday last the right hon. Leader of the Opposition asked me a question about four British cargo ships now marooned in Great Bitter lake in the Suez canal. The right hon. gentleman asked whether I could give him any indication as to the condition of these ships and their crews. As I have mentioned, they are British ships. The British government has asked our ambassador in Cairo

the Canadian embassy is now responsible in the United Arab Republic for British interests-to give what help we can to the crews of these ships, and find out anything we can about their condition.
Inquiries of the Ministry
The ambassador sought permission from the U.A.R. foreign ministry and from the Suez canal authorities for consular officials to make contact with the crews of these ships. He has not yet received that permission, but we have learned that the officers and men of the ships seem to be well and in no difficulty.


John George Diefenbaker: I thank the Prime Minister.



PUBLIC SERVICE


[Stage Direction]
On the orders of the day:
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question either to the Prime Minister or to the President of the Treasury Board. In order to prevent the matter becoming caught in the scramble over a summer recess, will the government now place on the order paper its legislation to provide for increases in the pensions of retired civil servants?


Lester Bowles Pearson: Mr. Speaker, I said the other day that this matter was under urgent consideration. It is. I hope that consideration will be completed shortly. I can assure my hon. friend that it will not be caught in any scramble over a summer recess, because I hope there will be no such scramble.


Stanley Howard Knowles: A supplementary question, Mr. Speaker. Is there any reason why the matter cannot be placed on the order paper within the next few days?


Mr. Speaker:: Order, please.



TELEVISION


[Stage Direction]
On the orders of the day:
Maurice Allard: Mr. Speaker, I should like to put a question to the Secretary of State.
Could the minister confirm to the house whether an agreement has been concluded between the Quebec government and the C.B.C. for educational broadcasts for 1967-68, and can she tell us who is responsible for the selection and contents of these programs?


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


Maurice Allard: At ten o'clock, Mr. Speaker.

June 15, 1967
Inquiries oj the Ministry INQUIRY OF THE MINISTRY
On the orders of the day:


Mr. Auguste Choquelte (Lolbiniere):: I
should like to join with the hon. member for Sherbrooke at ten o'clock, Mr. Speaker, and to put for the first time the following question to the Minister of Manpower and Immigration: Have the Estates General of French Canada requested the government or a group of government members to send a delegation to take part in the meeting which this organization will soon be holding?


Mr. Speaker:: This question could be put on the order paper.



AGRICULTURE


[Stage Direction]
On the orders of the day:
Hon. Theogene Ricard (Sainl-Hyacinihe-Bagot):: Mr. Speaker, I should like to put a question to the Prime Minister and, in order to enable him to understand the problem more clearly, I should like to read part of a telegram addressed to Hon. J. J. Greene by the minister of agriculture of the province of Quebec. I quote:
The federal government has allowed-*


Mr. Speaker:: Order. The hon. member is aware that the rules do not permit him to read a telegram in support of a question. The hon. member can put his question directly I am sure.


J.-H.-Théogène Ricard: Mr. Speaker, In view of the fact that the Prime Minister has probably not received the message, I simply wanted to acquaint him with its contents.
In his telegram to the federal Minister of Agriculture, the Quebec minister of agriculture protests against the fact that the federal government has admitted 90,000 cases of eggs from January to May 1967, as compared to
15,000	cases for the same period last year. Would the right hon. Prime Minister convince his Minister of Agriculture to take the necessary measures to put an early end to this harmful situation for our egg producers?


Mr. Speaker:: Order. This is a suggestion or a representation much more than a question.



DAMAGE TO PAINTING IN RAILWAY COMMITTEE ROOM

[Stage Direction]
On the orders of the day:
Mr. D. V. Pugh (Okanagan Boundary):: Mr. Speaker, my question is for the Secretary of

State, or through the minister to the appropriate person connected with the hanging of art in the House of Commons, or paintings.


Lester Bowles Pearson: "Art" who?


Some hon. Members:: Oh, oh.


David Vaughan Pugh: Is the minister aware that the picture "Vimy Ridge" hanging in the railway committee room has become damaged? I suggest that it be looked at immediately and that steps be taken to stop any irreparable damage.


Hon. Judy V. LaMarsh (Secretary of State):: Mr. Speaker, I thought for a moment the hon. member was talking about the hanging of my colleague who usually sits on my left, which has been suggested from time to time.


Some hon. Members:: Oh, oh.


Julia Verlyn (Judy) LaMarsh: However, this is not the responsibility of my department; it is in fact within the province of the Speaker. But I shall be very happy to have members of the National Gallery staff offer any assistance required so there shall be no damage.



INDUSTRY


[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, I wish to address a question to the Minister of Industry. I might say that I rise as a very sensitive soul who has been touched to the quick because I did not expect to receive from a fellow comrade and colleague the treatment I will mention. In view of headlines to the effect that Mr. Ray Perrault, leader of the Liberal splinter group in the legislative assembly of British Columbia-


Some hon. Members:: Oh, oh.


Herbert Wilfred Herridge: -has arranged a meeting with the minister to plead the Kootenay area's case for economic development, would the minister inform the house if it is now the government's policy to give particular consideration to representations made by Mr. Ray Perrault in ridings in British Columbia not represented by Liberal members of parliament?


Mr. Speaker:: Order, please. I do not think this question is in order.


Herbert Wilfred Herridge: Mr. Speaker, I know the minister would very much like to answer this question, and it is the cause of some concern in British Columbia.
June 15, 1967



CANADIAN CENTENNIAL


[Stage Direction]
On the orders of the day:
Mr. Joseph P. O'Keefe (St. John's East):: Mr. Speaker, my question is addressed to the Secretary of State. Could the hon. lady tell the house whether any provision is being made for the children of Canada to meet Her Majesty the Queen during her forthcoming visit?


Julia Verlyn (Judy) LaMarsh: Mr. Speaker, on the afternoon of July 1, on the grounds of parliament hill, a birthday party will be held. It will be particularly for children but will be open to any Canadian or visitor who may be here. Hopefully there will be many thousands, perhaps tens of thousands, of children here. In addition a special meeting has been arranged for Her Majesty at Landsdowne park with certain selected children.



PROPOSED NATIONAL CONFERENCE ON POLITICAL EDUCATION

[Stage Direction]
On the orders of the day:
Hon. W. G. Dinsdale (Brandon-Souris):: Mr. Speaker, I have a supplementary question that is related to an earlier question. Some weeks ago the minister indicated that the ad hoc committee dealing with the political youth seminar would be called together to consider the recommendations of the Canadian political youth council. Could the minister indicate when that meeting might be called, in view of the passing of time?


Julia Verlyn (Judy) LaMarsh: Mr. Speaker, I answered a similar question yesterday. The ad hoc meeting was held and the proposal was rejected, but since that time the centennial commission has offered some assistance. It is now a question whether the citizenship branch will be able to offer other assistance and whether cabinet will approve it.



INQUIRY AS TO NATIONAL TOURS BY CANADIAN PERFORMERS

[Stage Direction]
On the orders of the day:
Mr. Robert McCleave (Halifax):: Mr. Speaker, I wish to direct a question to the Secretary of State which will leave nobody in suspense. The question involves the centennial commission. Has the commission lined up other national tours by outstanding groups, such as the one now being undertaken by Don Messer and his Islanders complete with
Inquiries of the Ministry Charlie Chamberlain and the Buchta dancers, who are now in the far galleries from Your Honour, to mark centennial year?


Some hon. Members:: Hear, hear.



FINANCE


[Stage Direction]
On the orders of the day:
Mr. George Muir (Lisgar):: Mr. Speaker, I have a question for the Minister of Finance. Would the minister inform the house what type of construction will be exempt from the 11 per cent sales tax on building materials under his budget proposal?


Mitchell William Sharp: Mr. Speaker, that is a legal question that I do not think is answerable at this time.


George Robson Muir: A supplementary question, Mr. Speaker. Is the 11 per cent sales tax exemption applicable now to home construction?


Mr. Speaker:: Order, please. This question cannot be answered at this time.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Thomas Clement (Tommy) Douglas: Mr. Speaker, may I again ask the right hon. Prime Minister the question I asked him on Monday last and referred to yesterday. The Prime Minister did not have the note about it on his desk and thought he might be able to answer the question today.


Lester Bowles Pearson: Mr. Speaker, I did receive the telegram. I answered it and said the matter is being considered by the ministers concerned. I think the Minister of Industry can perhaps supplement this answer.


Charles Mills (Bud) Drury: Mr. Speaker, as hon. members will be aware since it was mentioned during the discussion of the estimates of the Department of Defence Production, a policy of national competition for government shipbuilding requirements has been introduced which included a transitional assistance program whereby certain federal requirements were allocated for competition on a regional basis only. I understand
1550	COMMONS
Cape Breton Development Corporation that existing government work at Burrard Dry Dock consists of a tidal and survey vessel with a value of some $3.5 million which is scheduled for delivery in late summer, and a research vessel which the company recently won under the transitional assistance program. Work on this research vessel, which has a value of some $9 million, is now in the design phase and it is anticipated that the work force will progressively build up over the summer months.
In addition to this government work already under contract, the company is bidding on two of the new destroyer escort vessels, with the successful bidder to be determined before the end of the year. Finally, invitations to tender for the first of the Restigouche class conversions will be issued during the summer for competition which will be limited to west coast yards.


Thomas Clement (Tommy) Douglas: In view of the fact that out of 800 employees some 350 are in the process of being laid off, does the minister have any figures from the company in question as to when it expects to get back to a full complement of employees.


Charles Mills (Bud) Drury: I have not any such figures.



CAPE BRETON DEVELOPMENT CORPORATION


Jean-Luc Pepin: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to establish a Cape Breton Development Corporation to acquire, reorganize and rehabilitate certain coal mining works and undertakings on Cape Breton Island, to conduct coal mining operations in the Sydney coalfield and to promote and assist the development of industry on Cape Breton Island to provide employment outside the coal producing industry and to broaden the base of the island's economy; to provide for the administration of the corporation and its initial financial and operating capital requirements including the consideration or *compensation established or determined to be payable in connection with the acquisition by the corporation of the said coal mining works and -undertakings, the sum of twenty-five million dollars for the purpose of reorganizing and rehabilitating the said coal mining works and undertakings and for preparatory work in connection with the conduct by the corporation of coal mining operations, and the sum of twenty million dollars for the purpose of promoting and assisting the development of industry on the island.
Motion agreed to and the house went into committee, Mr. Batten in the chair.
IMr. Drury.]
DEBATES	June 15, 1967


Jean-Luc Pepin: Mr. Chairman, I have kept very carefully, for several months, in order to use it today, a quotation from the London Observer, published in the Vancouver Sun of August 19, 1966.
[English}
Democratic politics is the art of finding sound policies that are also acceptable to the people.
The resolution and the bill that we are about to introduce are of that kind. Those of us who have worked on it, and we worked hard, Mr. Chairman, think that the content of the bill is sound, that it offers the best solution in the circumstances to a most difficult problem. They hope that spontaneously or after reflection the public will agree with them.
For the benefit of those who are not too familiar with the Cape Breton coal problem, Mr. Chairman, may I offer a few basic background elements. The coal industry in the Syclney-Glace Bay district employs some 6,500 people; that is in the mines, in the railways and in the shops. Along with the steel workers they represent one third of the wage earners of the area.
The Dominion Coal Company Limited, a partly owned subsidiary of Dominion Steel and Coal Corporation, that is Dosco, owns and operates No. 12 colliery at New Waterford, No. 21 and No. 26 collieries at Glace Bay.
The Nova Scotia Steel and Coal Company Limited, a wholly owned subsidiary of Dosco, owns the Princess at Sydney Mines, also referred to as Old Sydney, and McBean mine also referred to as Acadia, in the Pictou area. The production of the three collieries of Dominion Coal I have mentioned amounts to 2.6 million tons per year, and they employ 3,790 people on an average. These figures are for 1966. The production of the other group, that is Princess and McBean, is as follows: Princess, about 600,000 tons; McBean, about 200,000 tons, Which is 800,000 tons altogether. Princess employs 1,071 people and McBean 376.
Added to this there is the contribution of the independent operators. There are three of them in Cape Breton and four of them on the mainland. They produce altogether a little less than half a million tons of coal per year. The total production of coal in Nova Scotia in 1966 was 3.8 million tons, and in the Sydney coal field 3.3 million tons. This gives an idea of the importance of that production.
June 15, 1967	COMMONS
What about reserves? Even under the most liberal of geological assessments the coal resources of Nova Scotia comprise no more than 3 per cent of the Canadian coal resources which, as you know, are confined mostly to western Canada. The existing working and structural plant of the seams of the Sydney coal field point to the extension of the coal seams to about 12 miles out to see. Coal is now currently being extracted up to four miles under the sea and at depths approaching 3,000 feet from the sea bottom. I have been down there, as some other members have, and I must say I was surprised to realize that it sometimes takes more than one hour for people to move from the pit head to the face of the mine. Of course the same time is consumed coming back after a day's work.
[DOT] (3:30 p.m.)
Consequently we are faced with increasing problems of transportation, rock pressure and ventilation which bear directly on mining costs and the costs of maintaining safe working conditions. These considerations place a finite limit on the amount of coal which can be recovered, even by using the best tools which current mining technology provide. It should be added, Mr. Chairman, that coal is in competition with other sources of energy in the maritimes and in other parts of Canada and in other parts of the world. We very often read in the daily press and in magazines on the situation in France, Great Britain, Germany and Japan. Coal presents a problem in all of these countries as a result of technological changes. We are not in the nineteenth century any more. Coal today is not the near-exclusive source of energy that it was then. Canada is not the only country in the world with a major coal problem. The situation in regard to coal in the maritimes will be further aggravated if the current offshore exploration program in respect to oil and gas is successful.
A word or two about markets, Mr. Chairman. Fifty-two per cent of the Nova Scotia production is marketed in Ontario and Quebec at very high subsidy cost. May I give some examples. To move coal to Toronto requires a subsidy of about $9, to Noranda about $7.50, to Sudbury about $9.50, to Trois-Rivieres about $8. The remaining 48 per cent, or about 2 million tons, was marketed in the four Atlantic provinces at lesser subsidy costs, the average there being about $6.66. Hon. members know that the maximum federal subsidy is $10.50 in Quebec and Ontario and $8.50 in the Atlantic provinces.
DEBATES	1551
Cope Breton Development Corporation
The current market for Dosco coal in the Atlantic provinces is about 1.1 million tons per year. The thermal power coal market is not expected to grow significantly beyond the 1.5 million tons level in the Atlantic provinces because of the probability, perhaps I should say the certainty, of new power plants being based on oil rather than on coal.
To illustrate the uncompetitive nature of coal, let me say that residual oil is available at Atlantic and St. Lawrence ports at about $2.15 per barrel, which is the equivalent of about $9.10 per ton of coal. Dosco coal at the pithead currently costs about $14 per ton, and with a minimum transportation rate of about $3 per ton the level of subsidy required to make it competitive with oil in the Atlantic provinces and at St. Lawrence ports would be at least $8 per ton.
Feasibility studies have shown that a mine-mouth power plant is not an attractive proposition compared to the shipping of coal to existing generating centres. Some hon. members might disagree with that but this is the best information available to us at this time. The metallurgical coal market of some
500,000	tons to the Sydney steel plant has been largely lost to United States coal due to a high and increasing sulphur content in the Sydney coal, notwithstanding efforts which have been made to purge the sulphur from that coal. Last year 474,000 tons were imported from the United States for the Sydney steel plant and only 120,000 tons from the Sydney coal mines were used by the plant.
The difficulties of coal mining in Cape Breton are thus of long standing, Mr. Chairman. The industry has been investigated by several royal commissions, the last three being in 1946, 1960 and 1966, and also by a collection of committees. During 38 years of subvention payments the Nova Scotia coal industry has received nearly $200 million in subventions. Over half of this has been provided since the public hearings of the 1960 royal commission on coal.
Perhaps it would be well to underline that in 1957-58 the subventions were about $8 million, in 1964-65 $17 million, and that this year they will be $31 million. This figure is a little bloated because it includes some carryover from the previous year. The estimate for next year of $27.4 million gives a better picture of the situation.
The amount of subvention per coal miner represents today over $4,000 annually.
June 15, 1967
1552	COMMONS DEBATES
Cape Breton Development Corporation


David Lewis: That is an improvement on the figure given by Dr. Donald. As I remember it his figure was $3,500 or somewhere around there.


Jean-Luc Pepin: I do not know that I would call that an improvement.


David Lewis: The word "improvement" was in quotes.


John George Diefenbaker: Would the minister allow a question? What is the average production per miner on which those statistics are based?


Jean-Luc Pepin: It varies very much from one mine to another.


John George Diefenbaker: But what is the average?


Jean-Luc Pepin: I would say that two or three tons a day would be a good average but I will check that to make sure.


David Lewis: I think 2.8.


Jean-Luc Pepin: In comparison with production in other countries, for example, strip mining in the United States, I think the figure is four or five times lower than the results achieved in the United States by strip mining. However, I will come back to this because I would not want to give a false impression.
In addition to direct coal subventions, other forms of assistance to Nova Scotia coal mines amount to some $5 million per year. This assistance is provided under the Atlantic Provinces Power Development Act, the Maritime Freight Rates Act, the Canadian Coal Equality Act and the Coal Production Assistance Act.
I have before me the subventions per mine, and if during the course of debate hon. members would like to have them I would be delighted to provide them.
In 1950, following the 1946 royal commission report, Dosco embarked on a $18 million program to rehabilitate the mines and introduce new mechanical coal cutting equipment. This program was financed with the aid of a $7.5 million loan from the federal government under the Coal Production Assistance Act. I might point out, by the way, that the principal and interest payments are now in default by about $5 million.
This financial transfusion, however, was not sufficient. Early in 1965 Dosco informed the government that in order to continue operating it would require large capital grants ranging from $21.5 million to $37.8 million for a second major program of mine rehabilitation.

Subsequently Dosco informed the government that it wished to withdraw from coal mining altogether, and it offered to sell its entire coal mining interests to the government. So the mines will be forced to close unless substantial new capital is provided for rehabilitation and modernization. It is obvious that no commercial organization or financial institution is willing or eager to advance the necessary capital funds.
[DOT] (3:40 p.m.)

The policy followed by the Canadian government has been influenced by several major considerations. One of the first considerations is the limited viability of the Dosco mines.
A factor other than the one I have just stated is the intention of the Dominion Steel and Coal Corporation to get out of its coal mining operations in Nova Scotia.
A third factor is the need for very large capital to modernize and rehabilitate all those mines. A fourth is the lack of a market for Nova Scotia coal without federal subsidies.
I do know that there are markets, as I have often been told, but those markets remain as long as the federal subsidies remain and, moreover, provided those subsidies are increased.
At the present production pace of 3.5 million tons per year, it has been calculated that subsidies would have to reach close to $400 million during the next fifteen years; even then, the basic sources of the problem would not be eliminated. In other words, if we do nothing today, if we simply continue the present policy, fifteen years from now, having spent $300 to $400 million, we will be faced with the very same problem as we have today.


David Lewis: As in the past.


Jean-Luc Pepin: As in the past. I am not here to blame or justify the actions of past governments; I leave that to the conscience of the members of this house. I consider that all the preceding governments meant well, and I am not accusing them of not having done any better.
Of course, we cannot allow this situation to endure. However, nowhere in Canada shall we find one social problem comparable to this one. Here, and I insist upon this because it is the reason for our intervention, here we are faced with an important urban labour force, we are faced with established collectivities
June 15. 1967

which depend almost entirely upon a big industry which is no longer profitable, which cannot survive for more than a few years, by means of substantial subsidies. This is probably the most thorny problem that this country has ever had to meet.
The coal problem in Cape Breton is essentially a social problem. It is because of its concern for the welfare of individuals and collectivities, and not for the welfare of companies, that the government intends to subsidize the regional economy so that it may evolve from a state of subjection to a declining natural resource toward a more wholesome economic situation.
Undoubtedly, extraordinary efforts will be required and that is what we will be asking the house today, to activate the industrial renewal so as to create new jobs in that area.
Since the development of resources is involved, it seems that corrective measures should be left to the province. This opinion was often expressed before me. The answer is that the Canadian government has historically been involved through its subsidies programs which have kept the mines producing long after they would have been forced to close down, and this would have caused considerable economic and social dislocation.
That is why the Canadian government feels somewhat obligated-together with the Nova Scotia government-to provide financial and other assistance as long as the Sydney collieries are operating.

It was in the light of the foregoing circumstances that the government, through the then minister of trade and commerce who is now Minister of Finance, asked Doctor J. R. Donald to investigate the Cape Breton coal situation once again and to recommend a possible solution. Doctor Donald submitted his report and it was tabled in parliament on October 11, 1966. There is much good philosophy in the Donald report. I mention that partly because the hon. member for Qu'Ap-pelle accused me yesterday of lacking philosophy in the presentation of my estimates. There is much good philosophy, as I said, in the Donald report.
Doctor Donald examined the coal industry not in isolation but in relation to the broad economic and social conditions prevailing in that region. His approach was not only economic and financial; it was also humanitarian and social. His recommendations are based on the fundamental premise that even on a heavily subsidized basis the realistic working
DEBATES	1553
Cape Breton Development Corporation life of the Sydney mines can hardly exceed about 15 years, and that the government should use this period to prepare in a positive manner for the cessation of coal mining. This preparation must involve the creation of new foundations for the Cape Breton economy and a new and more attractive economic environment. That is the only way to forestall the economic debacle which would otherwise result from the closure of the mines.
Doctor Donald says that the choice is not one of preserving or not preserving coal mining indefinitely; the choice is one of planning or failing to plan for what is inevitable. The government is indebted to Doctor Donald for his analysis of the Cape Breton coal problem and for his imaginative and enlightened recommendations. I am pleased to see him in the gallery of the house at this time.
The report was criticized at first, mostly, of course, by the miners and also by other people, some of whom said it was not generous enough while others said it was too generous. I have always been comforted when people around me say that I do not move fast enough or others that I move too quickly. I expect that Doctor Donald also likes this position.


The Chairman:: Order, please. I must advise the minister that the time allotted to him has expired.


Some hon. Members:: Carry on.


Herman Maxwell Batten: Does the committee give unanimous consent for the minister to carry on?


Some hon. Members:: Agreed.


Jean-Luc Pepin: Mr. Chairman, I feel that this report will be a landmark in the economic history of Canada. Doctor Donald made many recommendations, but considering the lack of time I will not spell them out. We have agreed to very many of them and they will be found in the legislation and in the agreement that was tabled today.
On December 29, 1966, the government, I repeat, following careful consideration of the Donald report and its recommendations, the receipt of views of interested persons and organizations, and discussions with the government of Nova Scotia, announced in consort with Nova Scotia certain basic points of policy. The Minister of National Health and Welfare and I went down to the area to listen to the views of the people. We have received many views since then, just as other ministers had received many views before. As I say, on December 29 in consort with Nova Scotia we
June 15. 1967
1554	COMMONS
Cape Breton Development Corporation announced certain basic points of policy. May I spell them out.
1.	We agreed that parliament be asked to establish a suitable crown corporation, in which both Canada and Nova Scotia will participate, to acquire, reorganize and manage the coal mining interests of the Dominion Steel and Coal Corporation and simultaneously to help promote and finance the development of industry on the island of Cape Breton.
2.	For these purposes, Canada agreed to make a contribution of $45 million to the crown corporation, for the rehabilitation and operation of the mines about $25 million and for the development of new industry about $20 million.
3.	Nova Scotia agreed to contribute $10 million to the initial economic development fund of the corporation.
4.	In place of the present system of providing subsidies to a private corporation on its individual coal sales, the government agreed to request parliament to provide funds to the crown corporation to enable it to mine and market its coal to the best advantage, that is, to underwrite the annual coal losses of the crown corporation.
5.	Canada agreed to augment the initial industrial development fund of the crown corporation from expected savings in federal subsidies resulting from reductions in the level of coal production.
6.	It was agreed that the crown corporation, in rationalizing the mines, should give full consideration to the need for orderly adjustment, including the implementation of a generous early retirement plan as recommended by Doctor Donald.
7.	In view of the federal government's acceptance of the major financial responsibility for the long-term solution to the coal problem of the Dosco mines in the Sydney area, a problem of national concern, Nova Scotia agreed to accept complete responsibility for the independent coal mines of Nova Scotia. These are the several independent coal mines that I have already referred to.
[DOT] (3:50 p.m.)
8.	Nova Scotia agreed to consult with the crown corporation on coal markets in order to maintain an orderly market for Nova Scotia coal.
9.	Nova Scotia agreed, moreover, to issue no further coal mining permits or leases during the next 15 years unless the application for the coal permit or lease carries the approval of the crown corporation.


10.	The opening of a new mine at Lingan has been a matter of much controversy. In view of the government undertaking of October, 1965 and of Doctor Donald's strong recommendation against it, the government agreed to allocate sufficient money to fulfil its own commitment but to leave to the crown corporation the decision as to how these sums can best be used in the interests of the community.
11.	Canada and Nova Scotia agreed to establish a joint framework which will permit the concentration and co-ordination of all federal and provincial efforts to promote the economic development of Cape Breton island.
There are all sorts of organizations already in existence at the federal and provincial levels. We do not want to duplicate these efforts. There will be a great need for co-ordination between the two levels of government.


David Lewis: Before the minister speaks on another point, may I ask him whether one would be right in assuming that any payment to be made to Dosco for its alleged assets in Dominion Coal and Nova Scotia Steel and Coal would be in addition to the sums mentioned in the resolution?


Jean-Luc Pepin: Yes, but we can deal with that more profitably when we are discussing the legislation itself. There are clauses in the legislation in connection with the acquisition of the mines. I can guarantee that it is our interpretation that the money which may have to be paid for the acquisition of the mines is additional to the sums mentioned in the resolution.
I was talking about the agreement with Nova Scotia. Since the joint announcement in December by Canada and Nova Scotia of the basic points of policy on which the two governments are in accord, detailed discussions have been held with the province. I labour this point a little because people have so often asked, in the press and elsewhere, what we were doing at that time. I can guarantee that we have been working on this legislation, but the subject is much more complicated than is realized by many of the people who were asking us questions. The Leader of the Opposition knows how difficult and complex the writing of legislation can be. As a former professor of political science I did not suspect it would be as complicated as it is.


John George Diefenbaker: One learns from experience.


Jean-Luc Pepin: I expected the right hon. gentleman to invite me to go back to the university
June 15, 1967	COMMONS
in view of the fact that I am now more competent to teach properly.
The agreement I have tabled today contains provision for co-operation between Ottawa and Halifax in a number of areas which I shall enumerate. They include the form and functions of the Cape Breton Development Corporation and of its two divisions, the coal division and the industrial development division; the responsibility of each government in respect of the corporation; the matter of the annual capital and operating budgets of the two divisions of the corporation; the annual report of the corporation-the corporation will, of course, have to report to both governments; the early provision of a target phaseout timetable for the coal mines; the general means by which the two governments will co-ordinate economic development activities on Cape Breton island; the acceptance by Nova Scotia of responsibility for the independent coal operations; the agreement that no further coal mining permits or leases will be issued for the next 15 years without the approval of the corporation, and so on.
Thus, the two preoccupations of the corporation are the nationalization of the mining operations and the stimulation of industrial development in Cape Breton. Both are of equal importance. Can Cape Breton be stimulated? Can the economic base of Cape Breton be broadened to use the wording of the resolution? My colleague the Minister of National Health and Welfare will, I hope, take part in this debate. He will tell the house about recent developments in Cape Breton and about the federal contribution to these developments. He will tell us about the contribution made by the various departments-transport, public works, industry, manpower-and about the contribution made by the agencies of the government such as the Atlantic Development Board and ARDA. He will tell us about the new industrial park at Point Edward, about the new heavy water plants, about the new B.A. refinery project at Point Tupper.
I have studied these things with him. I have taken part in some of the negotiations and consultations which led to some of these projects, and I must say I am optimistic. Hon. members expect that from me, anyway. But very often in the past we have been told that there is no future for Cape Breton in coal and steel. Present events are demonstrating, I think, that there is a future for Cape Breton, partly out of coal, anyway, and that Cape Breton can be modernized.
I have read a report on the B.A. refinery project for Point Tupper which is of extreme
DEBATES	1555
Cape Breton Development Corporation interest. This project could contribute immensely to the broadening of the economic base of Cape Breton.
The purpose of the forthcoming legislation is to delegate to an autonomous crown agency the responsibility for carrying on this developmental work. I am well aware that problems of the magnitude which face Cape Breton island cannot be solved by governments alone without the full support of the people themselves. Without their help one cannot arrest the social blight which has afflicted their area. That we shall receive their support I have no doubt, for as Mr, Justice Rand wrote at page 50 of his report in 1960:
The people who make up the communities concerned, miners and their families, clergy, professionals, tradesmen, skilled and unskilled workers, are of the ordinary stuff of Canadians and, to general, are outstanding in personal relations, in friendliness and hospitality.
One cannot imagine such a people failing to-respond to this new challenge. I am sure they will take an active part in the rebuilding of the economic basis of their island.


David Lewis: Before the minister resumes his seat, may I ask him a question-unless the hon. member for Cape Breton South is rising to ask a question?


Mr. Maclnnis (Cape Breton South):: It is
quite possible I shall be asking a considerable number of questions and I trust the hon. member for York South will get the answers to his at the same time.
The minister told us that the resolution was a landmark in the economic history of Canada. I hope that in particular it will be a landmark in the economic history of Cape Breton island. If we wait as long for the implementation of this resolution and the bill that will follow it as we waited for other potential developments that were to take place, the miners in Cape Breton will continue to go underground for a considerable time yet.
[DOT] (4:00 p.m.)
The minister gave us a rundown on what the Minister of National Health and Welfare will have to say about economic development in Cape Breton. He referred to the B.A. development, the heavy water development, and so on. I trust that when the Minister of National Health and Welfare addresses the committee he will give members an understanding of what the Liberal leader in Nova Scotia said during last month's election campaign about developments in Cape Breton in recent
June 15, 1967
1556	COMMONS
Cape Breton Development Corporation years. I trust he will point out the actual facts.
I and I think all other hon. members directly interested in the coal industry in Nova Scotia are willing to expedite the passage of this resolution in order that we may get the bill before the house, at which time we may have further remarks to make. However, when making his arguments on behalf or in favour of Cape Breton whichever way one wants to look at them, the minister returned to another touchy subject, and I think it is time the government told the people of Canada the truth with respect to what is involved in subventions or subsidies paid to support Cape Breton coal mining. I appreciate very much, and I hope I will continue to appreciate, what is being done now for the mining situation in Cape Breton, but it is only right that the committee be given more of the history of what mining has meant to Cape Breton and what future developments to replace mining will mean.
At present in the town of Sydney Mines 38.6 per cent of the actual working force is employed in the coal mines. In the Glace Bay area 38 per ent of the actual working force is employed in coal mines. In the town of New Waterford 56 per cent of the actual working force is employed in coal mines. This gives an over-all average of 44 per cent of the work force employed in the mines. Everybody must understand what that means to the economic base of the area. Without the mines there would be no such towns. They could not possibly exist without the work which the mines provide.
Prior to the 1963 election Liberal candidates in Cape Breton as part of their platform said that a Liberal government would bring about great development, would start a research program and look after sales. But history moves on, and on October 5, 1965 in the city of Halifax, not in the coal mining area, the Minister of National Health and Welfare made a grand promise of $25 million to mechanize and improve mining in Cape Breton. Not only did he promise $25 million but poll workers for the Liberals in all the mining towns had the flat statement in their instruction books that $25 million would be given to the coal industry in order to put new life into it.
History moves on further to 1967 and now, despite assurances given over the last 20 months by the Prime Minister, the Minister of Transport, the Minister of National Health and Welfare, the Minister of Energy, Mines
[Mr. Maclnnis (Cape Breton South) .1

and Resources and the Minister of Industry-you name them, they are all included- that the policy announced on October 5, 1965 would be carried out, we have here what I hope will prove to be the answer to our problems. Unfortunately, however, another problem is developing. Mention of this other problem was made today by the Minister of Energy, Mines and Resources, although this resolution does not tie in with it. We all hope that the future new development will have favourable consequences and that it will prove to be what we all hope it will be and give new opportunity to the working force.
I trust that the bill to the resolution will give an assurance to each and every miner that before he is displaced from a colliery he will receive employment elsewhere. The difficulties in this connection will be tremendous, because one cannot just phase out a coal mining operation by taking individuals out of the mine. As many as 300, 400 or 500 new jobs will have to be available for the men taken out of a coal mining operation. There is also the question of training to be considered. The government will have a hard task before it.
I draw some satisfaction from the fact that, following passage of this resolution and the bill which will come before us on Monday, until the new development corporation can get its schemes off the ground the miners will have the protection of this legislation. However, I take strong exception to some remarks made by the minister. Since 1963, when the government took office, its members have been unable to differentiate between subvention and subsidy. Today the minister referred to subsidies and what they would mean. He used the word subsidies and said they mean a total of $4,000 per year to each and every miner employed in the coal industry.
The hon. member for York South questioned this figure and referred to the fact that Doctor Donald used the figure of $3,500. Doctor Donald was the commissioner appointed by the government to look into the matter of subsidies, and that was the figure he used. But worse, within the last month the Minister of Indian Affairs and Northern Development had the audacity to say that these subsidies would mean $7,000 per year to each and every miner employed in the Cape Breton coal fields.
We have a situation where Doctor Donald says $3,500, one minister says $4,000 and another minister says $7,000, and we keep on hearing these ministers use the word subsidy. Let it be understood by the minister once and
June 15, 1967

for all that it is not only the miners who are covered by the subventions. Without these subvention payments we could not get our coal to market, but the subventions cover any number of C.N.R. employees and the employees of other carriers. The subventions are paid to the carriers; they are not subsidies paid to the coal company itself.
The minister is still shoving the same old argument down our throats with respect to what the government has been doing. I say, let him point out the number of other industries and other developments in the economic life of this country that are also getting subsidies from the government. If he wants to talk about subsidies he can talk about the American magazines that are receiving subsidies. But no, one of the ministers talks about $7,000 a year as a subsidy to each coal miner. As I said to that minister when he made his stupid statement in the first place, if he wants to save money why not give $5,000 a year to each and every miner? They will be happy to spend the next 15 years of the phase-out period receiving $5,000 a year. According to the minister's figures this would be a saving of $2,000 per year on each and every miner employed in the coal fields.
[DOT] (4:10 p.m.)
Now we have a Cape Breton crown company. The hon. member for Coast-Capilano made a grand statement about this industry being one which we allowed to die. A member of the New Democratic party, speaking in Montreal-I cannot recall the date-said that they did not believe in nationalizing a dying industry. If this should be questioned I will do the research because it will only take a minute or two to check the date. I realize that the hon. member for York South is very anxious to have something to say on this matter. No doubt he has some questions to ask. I believe that the hon. member for York South could tell an interesting story about what may have developed on the sixth floor yesterday when the individual from the Canadian Labour Congress who recently joined the Prime Minister's staff ran the risk of getting his mouth shut in the proper way. Possibly the hon. member for York South could tell us the story.
It is regrettable that the agreement signed by the province of Nova Scotia and the federal government was placed in my hands only 15 minutes after the house opened, because I did not have much of an opportunity to go over it. No doubt, with Premier Stanfield's name on it, it is acceptable to me in most
DEBATES	1557
Cape Breton Development Corporation instances. There is one question but I can deal with it later when referring to the policy statement made by the Prime Minister.
With regard to the acquisition of the coal mines from Dominion Coal, I should like to refer in part to the policy statement of the Prime Minister on Cape Breton coal which was released on December 29, 1966. At the bottom of the first page and the top of the second page it reads as follows:
Assured of the participation of the government of Nova Scotia, the government of Canada is prepared to ask parliament to establish a suitable crown corporation-the composition and powers of which will be defined by the two governments at an early date-to acquire, reorganize and manage the coal mining interests of the Dominion Steel and Coal Corporation and simultaneously to help promote and finance the development of modern industry on the island of Cape Breton, within the context of a comprehensive economic plan for the redevelopment of the Cape Breton economy.
The resolution before the house covers that statement. He went on to say:
For those purposes the government of Canada will make a capital contribution of $45 million to the crown corporation for the rehabilitation and operation of the mines (about $25 million) and for the development of new industry (about $20 million).
I think we arrive now at the question to which the hon. member for York South was anxious to have an answer. I did not quite catch the minister's answer. Apparently the $25 million is for the rehabilitation of the coal mines and will be used for that purpose. The $20 million for the development of new industry will also be used only for that purpose and anything else paid for the acquisition of the coal company assets will be something which the federal government will look after over and above the other sums. Here I might make a recommendation to the government. In the acquisition of the coal company assets by the crown company there should be a rider attached-this might be part of the answer to the problem in respect of steel-to the effect that, since this company has done nothing but let the operations go downhill from the time it came to Nova Scotia, any money involved in the transaction between the federal government and Dominion Coal should remain in Cape Breton. This money might be used to help develop the steel industry in Sydney. In any event, it should remain in Cape Breton. Otherwise I would recommend to the minister that the whole thing should be expropriated. The shareholders of Dosco would not be hurt financially. It is granted that they would lose money, but anybody who could afford to hold Dosco stock
1558	COMMONS
Cape Breton Development Corporation over the years without receiving a dividend would not miss the money.
The Prime Minister in his statement went on to say:
The new crown corporation will have, as one of its two objectives, the broadening of the industrial base of Cape Breton. To further this objective, the government of Canada will augment its initial $20 million economic development contribution to the [DOT]crown corporation from expected savings in federal subsidies.
There is that word again, Mr. Chairman. One would think that in respect of something like this they would use more care in choosing their terms.


Jean-Luc Pepin: Mr. Chairman, may I be permitted to interrupt? I have the Concise Oxford Dictionary definition of the word subvention. It is: "Grant of money in aid, subsidy."


Mr. MacEwan:: That is not a recognized authority in Cape Breton.


Mr. Muir (Cape Breton North and Victoria):: You had better get another dictionary.


Jean-Luc Pepin: I am ready to accept that the Oxford Dictionary is not a recognized authority in Cape Breton.


Donald MacInnis: Now
that the minister has convinced himself that a subsidy and a subvention are the same thing, probably he could clarify for the benefit of the members of the house how much money went to the Dominion Coal Company as a subsidy. Is he prepared to say that a cheque was sent or will he admit that this money was paid to Canadian National Railways and other carriers?


Jean-Luc Pepin: The subsidy or subvention was paid to the coal producers of Nova Scotia.


Donald MacInnis: The
minister had better do some homework. The Prime Minister's statement continues:
In addition, it is the intention of the federal government to establish with the province a joint framework which will permit the concentration of all federal and provincial efforts to promote the economic development of eastern Nova Scotia and Cape Breton Island in accordance with a comprehensive plan.
I do not intend to say too much about that. The hon. member for Pictou is far more qualified to speak on that question. However, the resolution before us, unless the bill provides otherwise, is definitely not in accordance with the policy announcement of the

DEBATES	June 15, 1967
Prime Minister. The Prime Minister made this definite statement:
-the economic development of eastern Nova Scotia and Cape Breton Island in accordance with a comprehensive plan.
[DOT] (4:20 p.m.)
Again I repeat that the hon. member for Pictou, who has much more personal knowledge of he situation in this area, particularly in respect of the McBean mine which has been eliminated under the resolution, will deal with this matter when his opportunity arrives. The statement then continues:
The government of Canada and the government of Nova Scotia believe that a rigid adherence to a fixed timetable to reduce the level of coal production might involve unnecessary hardship on the dependent communities. Consequently, the rationalization of the mines will be related to the success in the introduction of new industries.


Herman Maxwell Batten: Order, please. I must advise the hon. member for Cape Breton South that his time has expired.


Some hon. Members:: Carry on.


Herman Maxwell Batten: Does the hon. member wish to continue?


Donald MacInnis: 
David Lewis: Mr. Chairman, I suggest that the hon. member for Cape Breton South was right, for two reasons, when he twitted the minister and others for constantly repeating the total amount paid by way of subventions or subsidies. First, subsidies and subventions of one sort or another are not new in the development of the Canadian economy. I have a great deal of sympathy with the miners of Nova Scotia for resenting the implication of the suggestions constantly made that they have been beneficiaries of particularly privileged treatment, when in fact subventions have been made over the years to the western coal producers and support prices have been instituted for other products and resources in our economy.
An economy such as Canada's, stretched over many thousands of miles from one ocean to the other, frequently presents the country with a need to support the production and transportation of a particular product, one instance being to bring cheaper fuel to the markets in central Canada. My friends in Cape Breton, Nova Scotia generally and the other Atlantic provinces refer at times to those in upper Canada as having been greedy throughout the 100 years history of this country. I agree with the hon. member for Cape Breton South in his objection to the constant reference to subsidies. But, second, that is not the problem. The problem, as the minister has stated and as Doctor Donald has stated, and as many other inquiries before Doctor Donald's have established, is the constant, almost total economic deterioration of a whole community, and the fact that the two major industries on which the community of Cape Breton has depended and still depends have been over the years on a toboggan slide downward. For this reason, even though my colleagues and I of course support the belated but useful step taken by the government as

indicated in this resolution, I submit that once again this government and this parliament under the leadership of the Liberal government will take a half step instead of a full step to deal with the community problem of Cape Breton because the resolution deals with only one industry in the area.
The Minister of Energy, Mines and Resources referred in glowing terms to the report of Doctor Donald. Undoubtedly it is a very important document, couched in concern for the community and the human problems involved. But his terms of reference, as I remember the statement in his report, were limited to a consideration of the coal industry. So he considered that industry. But the fact is that there is another industry on which Cape Breton's future depends and that industry is also going down. The same corporation is involved. Unemployment is increasing in that industry, in the Sydney plant. Neither this resolution nor the legislation to be based on it deals in any way with the second industry which is the basis of the Cape Breton community, namely, the steel industry. That is my complaint and the complaint of my colleagues about steps now being proposed by the government. I will come back to that in a moment, if I may, Mr. Chairman.
I went to Cape Breton island for the first time about 30 years ago. I do not recall whether I had the privilege of meeting the hon. member for Cape Breton South at that time. He is probably too young. But the thing that has struck me over the 30 years-and the blame for this lies at the door of this and other governments, federal and provincial-is that every time I have gone back to Cape Breton, and I have done so, I suppose, about 20 times in the 30 years, I have found that the same problems existed but they had grown worse every subsequent time I visited there.
Inquiry after inquiry has been held. The Minister of Energy, Mines and Resources referred to one of them. I think there have been four of five inquiries. The volumes of the reports and their supplementary data could fill a library. Almost every one of the reports-and over the years I have studied most of them-has emphasized the need of doing something fundamental, even though none of them was quite as extensive and broad as Doctor Donald's and, I would say, Mr. Rand's report of 1960, if my memory serves me right.
For all these years we did nothing as a country or as a province. What has been the result? I think it is important for everyone of us, those of us like myself who do not live in
June 15, 1967

Nova Scotia or Cape Breton, to realize what we as a country have allowed to happen in Cape Breton. It is not the fault of the people in Cape Breton. It is superfluous for me to say, as I am sure every member of this house who has visited that island will agree, that the people of Cape Breton are as industrious and as devoted to Canada and their community as any other people in this country. It is not their fault. It is the direct fault of a corporation, a non-human, indeed inhuman copora-tion that has exploited the coal and other resources of that province.
In the case of the steel plant at Sydney, at the turn, of the century this corporation was given municipal tax incentives by the city. It was given other incentives. Through the years it has received almost $200 million in subventions, subsidies and other assistance and has cared not a fig for the future of the community. It has cared not one iota for the future of the people of Cape Breton island and the communities they have built. It has taken all the largesse throughout these years from the federal, provincial and municipal governments. After these moneys had been paid the corporation closed down mines and is now closing down, bit by bit, the Sydney steel plant.
My social philosophy is well known to members of this house. Perhaps one of the most typical examples of what I am saying is to be found in what Dr. MacKintosh once said. Dr. MacKintosh is a famous Canadian economist. I have his words before me. With respect to the capitalist or free enterprise system he said:
[DOT] (4:40 p.m.)
It draws a very bad mark indeed for its allocation of the penalties of the destructiveness of change.
This is exactly what has happened. The people of Cape Breton have paid the penalty. Dosco and the government have paid no attention to the long-range problem. I should like to cite from a speech by Reverend A. Hogan to the 18th dominion-provincial coal conference on September 16, 1966. He is a well known economist who teaches at St. Francis Xavier and he has been interested in Nova Scotian social and economic matters, particularly those relating to Cape Breton, for a good many years. In addition he is, if I may say so, a social economist instead of one of those economists who claim not to make any
Cape Breton Development Corporation moral judgments. He makes them, and I respect him for it. This is what he says in the speech to which I have referred:
All of us know from common observation and history, as well as a general understanding of the nature of our economic system, that the decline and disappearance of an industry is not a new thing. We especially realize this in regard to the gradual depletion of the economic seams of a non-renewable resource such as coal or any other mineral.
Yet I venture to say that for many of us regardless of age, education or skill, the experience of being caught up in such a ferment of change with all its implications, is an abstract one.
I am trying not to make it abstract for myself and for those who are listening to me.
We've read about such occurrences, heard about them, but rarely if ever have concrete experience with what this type of upheaval means, in social and economic terms.
As have hon. members who represent ridings on Cape Breton island.
At a deeper psychological level we are scarcely aware of the emotional impact in terms of fear, suspicion, despair and even rage that a severe dislocation effects in relationships between individuals and groups at such a time.
This is the kind of problem with which governments, federal and provincial, have been faced for many years. The Reverend Mr. Hogan also says in the same speech, and it is worth putting a few of these quotations on the record, that one of the consequences of the neglect of Cape Breton as a community by the corporation, Dosco, which has been the main corporation in the community, as well as by the provincial and federal governments, has been a constant migration from Cape Breton. This has resulted not only in a loss of population but a loss of that adult population which is productive. He says, after setting out a table, that the figures above reveal there has been a substantial migration of the young and active element of the population. Many of those who are left have low or no mobility potential.
These are the problems, I insist, that we face. Father Hogan also points out that the loss of people in the most productive years of their lives has meant that the local communities have not been able to get the taxes necessary in order to produce the services that are needed, whether they be housing, education, road building or sewage facilities. These facilities have not been produced at a level which the people of Cape Breton deserve and which the local municipalities want to have.
Obviously, in a declining economy and with the loss of people in the age groups which are most productive, you necessarily have a lower
June IS, 1967
1562	COMMONS
Cape Breton Development Corporation base for municipal revenue. You have, therefore, immense obstacles to the building of what economists call an infrastructure to a level which can receive modern industry. I refer to the various services that are required for this.
I should like, finally, to refer to page 13 of the speech, a copy of which I have before me, where Rev. Mr. Hogan repeats in strong terms what the minister said. I agree with Father Hogan, and I think with the minister, that there is every possibility for the re-development of the Cape Breton area. It is both possible and feasible, Father Hogan says, and he reaches that conclusion after a long and careful study of all the literature available to him. I may be putting this in a more exaggerated way than he would, in humility, have put it himself. However, he has obviously come to this conclusion on the basis of study.
Since there is a shorter time limit on speeches at the resolution stage I have to be sketchy. I may have to exceed it as others have done, but I do not want to do so to any great extent. I may say, very briefly, that the government opposite, which has been in power in Canada for most of this century, carries on its shoulders responsibility for the fact that an entire community has been permitted to become run down. It is ready to take action only at the moment when the situation is so desperate that even the doctrinaire people sitting opposite are forced to do something in the only way in which it could have been done, that is, by the direct intervention of the federal and provincial governments.
I hope I do not have to spend very much time indicating to the public and to members opposite that the steel industry in Cape Breton now presents a difficult problem, almost as difficult as the coal industry. The Rev. Mr. Hogan pointed out in his speech on page 2:
Your concern here is primarily with coal and its acute problems. In my opinion there is just as real, if not as immediately pressing, a threat to that area's future survival from an impending serious situation confronting operations of the Sydney steel plant.
This is true. It has been increasingly true for ten years, Mr. Chairman. There is nothing in the resolution before us or in the bill based on it, because I have looked at the agreement which was tabled today, to suggest that this government or indeed the corporation which is to be set up will do anything about this plant at Sydney. The only thing that can be done for the Sydney plant, and probably the


plant at Trenton as well, is that they be included under public ownership of the crown corporation being set up. The reason I say the only way I will come to in a moment, if I may. In the meantime, may I indicate some figures that have been provided to me by the unions at the Sydney plant?
The working force somewhere around the beginning of this year, including the hourly rated as well as the salaried people, was about 3,075 at the Sydney steel plant. This was a reduction from an average of about
5,000	to 6,000 not more than ten years ago. Since these figures were obtained, I went back to the reports in the newspapers to write down the lay-offs that have already been made or announced. We find that on June 4, 210 were laid off and on June 11, 112, even though the forecast was only 90. We have also been told that about 300-probably more-are to be laid off on June 18. If you add to that-this is an estimate made by certain people-the 100 office employees who will be laid off because the employees on the production force have been laid off, you have a reduction of about 25 per cent from the work force at the beginning of the year. There will be a reduction of about 730 or 740 people if the figure for June 18 is not more than the 300 which the company now forecasts.
9 (4:50 p.m.)
It is also clear, Mr. Chairman, without taking the time to go into the details, that Dominion Steel and Coal Corporation has no intention of improving or diversifying its steel operations in Sydney but, on the contrary, has every intention of moving department after department of its Sydney operation to the Contrecoeur complex near Montreal. I challenge anybody here to contradict this statement in view of the actions of the company during the last little while. It is perfectly clear, and this is what we ought to guard against, that if Dominion Steel and Coal carries on its operation on the same basis as it has hitherto-and there is no reason in the world to suspect that it will do otherwise-that is to say, looking at its financial statements without regard to the welfare of the community which it is supposed to have served for many decades, from the point of view of the profitability of Dosco it is better for the company to transfer more and more of its operation to Contrecoeur which is closer to the Quebec market. By doing this they will probably forestall the building of a large steel complex by the Quebec government because they will have pre-empted the market.
June 15, 1967	COMMONS
What action does the government take in this regard, Mr. Chairman? Surely it is senseless and utterly irresponsible-and I suggest to the minister that his government is irresponsible in this situation-to talk about phasing out coal, because whether this is done at a slow or fast rate it will mean tremendous local dislocation and the creation of tremendous human problems. The government talks about building new industry-


Herman Maxwell Batten: Order. I regret to interrupt the hon. member but the time allotted to him has expired.


Some hon. Members:: Carry on.


David Lewis: Thank you, Mr. Chairman, and I thank the members of the committee. The government talks about building new industry but takes no steps now to ensure that an important industry, which according to many experts could be made economically viable and on which so much of the economy of Cape Breton rests, is not allowed to continue to go down the drain, as is the steel industry in Sydney as a result of deliberate action taken by Dosco.
I said before, Mr. Chairman, that if the minister should say or if anyone should suggest that the corporation it is proposed to establish will be free to assist Dosco to modernize its plant in Sydney and so on, then as far as I am concerned-and I think I speak also for all of my colleagues-I have no confidence whatever in the intentions of this giant corporation which has bled Cape Breton island for decades and has left nothing of value in return. I certainly have no confidence in them knowing that the decisions are not made by Dosco but are made by the large international corporation, Hawker Siddeley, of which Dosco is now a part.
Second, Mr. Chairman, I say to the minister that there is no evidence whatever that any help that Dosco gets to rebuild its plant in Sydney will be used for the purposes that he and I have in common. There is only one way. I would urge the minister, as the members of the C.C.F. party and the New Democratic party have urged govermnents over the past 30 years, to accept that the only way to save the steel industry in Nova Scotia and thus to save the second most important industry in the Cape Breton economy, is to bring the steel industry as well as the coal industry under public ownership through the crown corporation being set up.
DEBATES	1563
Cape Breton Development Corporation
This crown corporation would be able to formulate a plan and would have the opportunity to co-ordinate the two basic industries in Nova Scotia. Even if the coal industry were eventually phased out, I venture to prophesy, though this is dangerous to do particularly for a layman, albeit one who has made some study of the subject, that there will be a coal industry in Nova Scotia for many years to come. The industry will be modernized.
The Prime Minister said in his statement that coal production should be reduced to two million tons. However, even that means a relatively substantial industry for that community and it would take a good many years to achieve that reduction. I am not saying that I agree with the Prime Minister because I honestly do not know. I am prepared to leave the matter to the corporation, which because it is a public corporation will, I hope, act with the welfare of the community at heart rather than act in the heartless way in which Dosco, as could be expected, in fact acted.
I am not saying that I agree with the Prime Minister's estimate of two million tons or with the conclusions of Doctor Donald, though I have every respect for the competence of Doctor Donald and I am not contradicting him. But for the purpose of the present discussion I am saying that it will take many years before this reduction to two million tons per year will take place, and this in itself will retain a pretty substantial coal mining industry in that particular community.
Therefore, I suggest that the corporation ought to be given authority over both steel and coal. I am informed both by those who have studied the subject and from my own reading that it is perfectly possible to produce in Sydney various shapes and sizes of structural steel both for use in the Atlantic provinces and for export, particularly to developing nations. I am also told, and I understand from my reading on the subject, that all of this will require a great deal of modernization of plant as well as the introduction of new equipment. This is something Dosco would not undertake; if they wanted to do it they would have done it before. They did not have to do this at Contrecoeur. No one forced them to go to Contrecoeur. Therefore it is obvious they would not undertake this in Sydney; it can only be undertaken as a result of public ownership.
I want to spend a minute or two on one other subject and I will be through, Mr. Chairman. I am very concerned about the
June 15, 1967
1564	COMMONS
Cape Breton Development Corporation negotiations which are going on with Dominion Coal and Steel Company and Nova Scotia Steel and Coal with regard to the compensation that those companies are to receive.
I hope-I say this with some sense of responsibility-that those companies will not receive any compensation under the circumstances. I emphasize the words "under the circumstances" so that no one will take that sentence out of context and say on political platforms across the country that the hon. member for York South, or the deputy leader of the N.D.P., or David Lewis, however they put it, says that he is in favour of not compensating an industry when the government takes it over, because this would not be true. I am in favour of compensating companies when they deserve compensation, when what the company in question hands over is a going concern.
What is happening in this case, Mr. Chairman? The coal mines are not owned by Dosco or by the subsidiaries of Dosco. They are, of course, crown property and Dosco is supposed to pay royalties for the use of the land. But what assets does the company have? Since only the coal mines are being taken over, this means that this company will be saved the headache of carrying on an industry which has lost money for years. What compensation should a company receive for being relieved of a headache? That is what I should like to know. We would be much more justified in saying to Dosco that it was about time that they paid something out of the huge treasury of Hawker-Siddeley ins-stead of putting their hands in the public treasury to pay their preferred shareholders, or whoever it is, when they are operating a losing proposition.
[DOT] (5:00 p.m.)
I hope the minister will tell us during the course of the resolution stage or on the committee stage of the bill who these preferred shareholders are, how long they have held their shares and how much they have received in dividends up to 1962, since when, we are informed by the officers of the company, no dividends have been paid. I am not saying this merely because I am being hard on a company but because one of the subjects raised by the hon. member for Cape Breton South is important. If the minister or the federal government have an extra $1 million or $2 million or $3 million to spare, then, instead of giving it to the company which does not deserve it, they ought to give it to the pensioners of the Dominion Steel and Coal Company.


As the hon. member for Cape Breton South said, if my memory serves me correctly, in 1952 or 1953 this company reduced the gratuity which it paid to its retired employees. The hon. member is really justified in what he says. I am not saying he is justified in his legal arguments with the Minister of National Revenue because those have to do with another subject, but he is justified in characterizing what the company paid not as a pension but as a gratuity. There was no pension plan; not only was it non-contributory but there was no fund. It was entirely unfunded. Whether somebody got the pension depended on the company's will and when the company decided 15 years ago to cut the pension it did so and no one had any recourse; no one could do anything about it. Whether or not there is any spare money, I think that the welfare of the pensioners of the Dominion Steel and Coal Company and of the other coal company ought to have priority. I know that my colleague, the hon. member for Vancouver-Kingsway, wrote to the Minister of Industry about this pension problem. That minister handed the letter over to the Minister of Energy, Mines and Resources, and I know that the hon. member for Cape Breton South and others have raised this matter many times.
I say, Mr. Chairman, that the bill ought to give three guarantees, which are as follows: First, that whatever pension is now being paid will be taken over by the new corporation, because as the payment was in the form of a gratuity rather than a pension the new corporation could make that payment disappear in law. I hope that the bill will show that that guarantee is included. Second, that the bill will contain a guarantee that those who are now retired will have their pension increased to a decent level, at least to the level of some years ago before the company reduced it. Third, that the promise of the Prime Minister that Doctor Donald's recommendation for a generous and just retirement plan will be adopted will also be written into the law as a guarantee, because God knows what might happen were the members of the board of directors of the new corporation or the bureaucracy left without some statutory guidance on these points and problems that might arise.
I wish it had been possible-with all my heart I say this-for me as the first spokesman for our party today to say to the minister, "You have taken a useful and important step and I have no criticism of it in general terms, whatever criticism we might have
June 15, 1967

when we see the details." I cannot say that. To do a real job for the Cape Breton community and to assure all the people of that community that a new dawn has really risen and that they can look forward to a future of progress, which might even attract those young people who have left the community back to it, the government in this resolution and in the legislation ought to have included steel as well as coal. Their failure to do that proves to me once again for the umpteenth time that from the government, with its social and economic concept and conscience, we can at best expect a half step taken under the duress of desperation but never a full step.
That is why I cannot extend the kind of heartfelt thanks that I should have liked to extend with respect to the resolution before us and the promised legislation. The step could be important. Whether it will be will depend on what the government does in the future with the steel industry and the coal industry and will depend particularly on the imaginativeness with which new industry is brought into the community and how community needs are geared to the reception of new industry.


Mr. Olson:: Mr. Chairman, I wish to speak briefly at this stage of the debate on the matter before the committee. I do so not because I have knowledge of the economic and social conditions of Cape Breton but because several millions of dollars of federal government money are involved in giving effect to the proposal now before the committee. At the outset I wish to say that we in this party do not disagree with the federal government giving emergency assistance to any area of Canada to help with economic and social problems. In his statement the Prime Minister said that the federal government realizes that the Cape Breton coal problem essentially is a social problem. On that basis our party in large measure agrees to support this action to revitalize the economy and to deal with the social problems of the area concerned.
The economic climate in Cape Breton has declined, and I wish to ask one or two questions of the minister. On the second page of the Prime Minister's statement we find the Prime Minister saying that it is anticipated that the operating losses in the first year alone will be in the order of $25 million. My first question is: How long will the federal government be called upon to make up these losses on the coal operations? The government will also assist with the social problems of the area. In another place the Prime 27053-100
DEBATES	1565
Cape Breton Development Corporation Minister says in his statement that the government of Canada will make a capital contribution of $45 million, $25 million for the rehabilitation cf the operation of the mines and $20 million for the establishment and development of new industry.
The $25 million that is apparently earmarked for the rehabilitation and operation of the mines, according to the resolution and the bill to follow, is to be for only one year. Will we be asked to contribute $25 million for 1968, 1969 and 1970? What plan is there for diminishing this amount? The minister did say that the federal government was concerned with the planning which would take care of this problem. If the government has planned well we ought to know before the resolution passes what the losses on the coal operation will be in subsequent years.
I listened fairly carefully to the minister's opening remarks and I did not hear him suggest that there would be an aggregate amount of $250 million or $300 million. Perhaps the minister wishes to say something now.


Jean-Luc Pepin: The $25 million is for the development or rehabilitation or modernization of the mines. The $20 million is for economic development. Then, as I have already said, the corporation will take over the subvention-I do not know what other word I could use. It is expected that in the first year the loss will be of the magnitude of $25 million but as we progress in the phasing out of mines it is expected that savings will occur. I cannot now say what the savings will be in the first, second, third, fourth or fifth years. That will depend on the number of mines which will be closed.
[DOT] (5:10 p.m.)


Horace Andrew (Bud) Olson: What this committee and the House of Commons are being asked to approve is $25 million for the rehabilitation of the operation of the mines, to be provided in the first instance as a capital investment by a crown corporation. Then there is an additional $20 million, to begin with, as a capital contribution toward the development of new industry. Over and above this there is an additional $25 million, at least in the first year, to cover losses in the mining operation. In other words, this is a call for something like $70 million, to start with, not $45 million, and there will probably be a call in the next fiscal year for another $25 million or perhaps a little less, and the same in subsequent years, if I understood the minister correctly.


Jean-Luc Pepin: Yes.
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1566	COMMONS
Cape Breton Development Corporation


Donald MacInnis: The
minister is nodding his head in agreement. But does he not place this interpretation on it, that the loss which would be faced by the crown corporation would correspond to the moneys which are now paid by way of subvention? It is not really a case of a double loss, as the hon. member seems to understand it and as the minister appears to be approving. It is really a matter of the government taking money out of one pocket and putting it into another.


Jean-Luc Pepin: I am sure the hon. member for Medicine Hat understood that.


Horace Andrew (Bud) Olson: I understand that the $25 million does not represent an entirely new expenditure. It is a substitute for an expenditure which has been made up to the present time. But we have not been told whether the precise amount now paid by way of subvention is to be paid. Is the cost to the federal government in subventions $25 million at the present time or does the $25 million represent a substantial increase in the cost to the federal treasury?


Jean-Luc Pepin: I said in my speech that this year the amount will be $31 million and that it was expected to be $27 million next year. May I be more precise? We already have two sums, $25 million for the mines and $20 million for economic development. The third sum is not dealt with in the bill. It will be voted as usual by estimates.


Horace Andrew (Bud) Olson: That clarifies one or two of the points I wished to raise. My next question is this. Reference was made in the minister's statement to another $10 million. We were told that the government of Nova Scotia would contribute $10 million to the economic development fund of the corporation. Is there any arrangement between the federal government and the province under which the federal government would assume all or part of this provincial obligation? I ask this question because there have been a number of examples of cases in which provinces have been party to an agreement under which they undertook to make contributions to certain programs whereas in fact, as became known later, arrangements were made for a large portion of those contributions to come from the federal treasury.


Jean-Luc Pepin: In this case it is as simple as it looks. The Nova Scotia government will give $10 millon to the corporation for the economic development of the island. I understand that
f.Mr. Pepin.]

some of this money has already been voted in the provincial legislature.


Horace Andrew (Bud) Olson: That is fine. There is one other point I wish to make with respect to the $45 million. It seems to me, after a cursory examination of the situation and having listened to the minister and to the hon. member for Cape Breton South, that perhaps more money be spent on the development of new industry and less on the modernization of an industry which some people believe is declining rapidly. It seems to me a wrong balance may have been struck. Perhaps the minister could give us an explanation later of the reason these figures were chosen.
Finally, I wish briefly to bring up the subject of the compensation to be paid to the company which now owns the operations to be taken over by the crown corporation. We in this party do not believe that the federal treasury has any inherent responsibility even in this situation to compensate shareholders for the loss of an asset which apparently has no market value. I believe it may be a bad precedent for the government to agree to pay any arbitrary amount as compensation for so-called assets which are really no assets at all. These undertakings have exhausted their value as viable economic units. I say it would be a bad precedent to pay compensation because it would establish that in one case at least the government had taken over a dying industry, on the grounds that a social problem was involved, to the benefit of shareholders who were not part of that social problem. We can look across Canada at prosperous areas as well as depressed areas and find examples of businesses which have failed causing hardship to their employees and to the surrounding communities, and we are apprehensive about giving our approval to any substantial payment being made for an alleged asset which really has no value.
It has been pointed out by several hon. members that the marketable value of the Dosco assets is nil except, perhaps, for some salvage. We do not believe it is the proper function of the federal government to bail out the people involved in a corporation, at the end of an industry's life, when those people are not part of the social problem with which we are trying to deal. What matters here is the welfare of the people of the communities on Cape Breton island, not the situation of those either in Canada or abroad who may happen to own shares in the corporation. So I hope the government does not intend to raid the federal treasury to pay people who, as I
June IS, 1967

say, are not part of the social problem we are trying to solve.
We in this party are in favour of assisting our fellow citizens when they face a serious social or economic problem but we would be opposed to any action which would compensate people who do not require social assistance.
[DOT] (5:20 p.m.)


Robert Muir: Mr. Chairman, I will not be too long because we are anxious to see the resolution pass and have the bill come before the house.


Some hon. Members:: Hear, hear.


Robert Muir: I appreciate the applause from the Liberal benches. I say I will not be too long because we have waited a year or more for this legislation to be introduced. However, a few more hours will not matter too much.
I appreciate the remarks of the previous speaker, the hon. member for Medicine Hat, who expressed support for the resolution and for the new corporation to be established. I fully agree with his comments regarding the payment of compensation to people who came to Canada about ten years ago and took what they could out of this industry.
I also wish to commend the minister for his introductory statement on the resolution. He gave us some of the history and background of the coal industry. I am sure he must have been surprised to receive such condemnation from the hon. member for York South because it was only a few short weeks ago that one of the principal speakers for the New Democratic party was in Nova Scotia and on that occasion the minister's name was not mentioned at all. In fact, someone demanded to know why a fellow by the name of Stanfield had not set up the Cape Breton Development Corporation. I am sure the hon. member for York South realizes that this is a joint arrangement between the federal and provincial governments. But on the occasion to which I refer, someone seemed misinformed regardless of the fact that he had sat in the house day after day and heard questions posed to the government front benches regarding the Cape Breton Development Corporation. The initiative for introducing this measure had to come, of course, from the minister and the government.
I would express one more word to the minister with respect to the delay in introducing this legislation. I agree with him that it is not 27053-100J
DEBATES	1567
Cape Breton Development Corporation an easy matter. I know that the minister has spent many nights working on it, and some time ago he said to me that he was willing to learn all he could about the problem. X see the hon. member for Antigonish-Guysborough saying something in the minister's ear. He is probably telling him, "Now you can expect the brickbats." I can tell the minister they will not be directed at him. They will be directed at the government both for the delay and for several things mentioned in this resolution.
On October 5, 1965, the cabinet representative from Nova Scotia announced all the great things that were going to be done with the $25 million he promised. Among these was the opening of a new mine at Lingan. I do not see anything about that in this resolution. Possibly it may be mentioned in the bill which will follow or we will be told that the new corporation will go ahead with it. That statement was made by the cabinet representative from Inverness-Richmond, with a great fanfare and eruption at Halifax. It just happened that it was only a few weeks before a federal election and maybe that had something to do with his making the statement. I do not know.


Mr. Cote (Longueuil):: It did not help very much.


Robert Muir: No, it did not. I appreciate that remark from the Postmaster General. He is realistic.
Then, on October 11, 1966 the Donald report was tabled. Despite the fact that day after day we in this party and members in other parties had been asking about the Donald report, no one on the treasury benches knew anything about it. We got the impression it was not ready, that this guy Donald was lazy and was not getting it out. As I say, it was tabled on October 11, but it is interesting that the date of the report is May, 1966.
I must presume that during all the time statements were being made by the Prime Minister and by the Minister of Energy, Mines and Resources we were being given evasive replies in answer to our questions. Many times we would have liked to pose questions to the minister from Nova Scotia who now avoids his responsibilities, unlike other representatives from Nova Scotia who were ministers in previous governments, including the present Minister of Trade and Commerce. But we cannot pose questions to the present Nova Scotian minister on any subject but health. Well, we hope he remains healthy.
June 15, 1967
1568	COMMONS
Cape Breton Development Corporation
As I say, Mr. Chairman, the report was tabled on October 11 but the date on it was May. There may be an explanation for that.
I am sure the Minister of Energy, Mines and Resources, in his usual genial manner, will have some explanation for it. However, a few hours after it was tabled I was asked to issue a statement on it to the press and radio. Unlike the hon. member for Antigonish-Guysborough I dislike quoting myself but I must read part of my statement into the record because it is pertinent to this debate. As I say, I made this statement a few hours after the report was tabled and I had only time just to skim through it. This is what I said:
Since I have not had an opportunity to thoroughly digest all of the long-awaited Donald report, I feel that while it certainly paints a black future for Cape Breton in many ways, it also has some good points.
The recommendation for the Cape Breton Development Corporation looks excellent on paper; how it will work out in actual practice is another matter. If this corporation were established, it would have to bring new employment to our island post haste and provide displaced miners with new jobs with a pay equivalent to what they are already earning or more, and not subject them to a long period of unemployment.
We are all aware of the efforts made by Industrial Estates Limited over the years to bring industry into our area, and while they have made excellent progress we have seen that it requires a tremendous expenditure to provide even a few jobs. Further to that, we have been faced with the loss of 650-700 jobs at the Point Edward naval base through the actions of the present government, and within the next year or so we are going to see another 600 to 700 men displaced at the North Sydney ferry terminal, again through the present government's action. So, I would think that this, along with the recommendations of Dr. Donald, would mean that such a corporation would have to act and act very quickly.
The member for Inverness-Richmond on October 5th, 1965, made a definite commitment on behalf of the government that a new mine would be opened in the Lingan area, plus several million dollars of new capital for rehabilitation and modernization of existing mines. Strangely enough, Mr. MacEachen's policy announcement came only several weeks prior to the last federal election. He, along with the Prime Minister and Minister of Transport, have reiterated this commitment on a number of occasions since. Surely they are not going to back down on such a commitment at this time. If they do, we can only assume that this is a continuation of phony promises to secure votes before an election.
After all this time, we are now confronted with information in the house from Mr. Pepin, minister of mines, that there are now going to be further discussions take place and representations made to the government in the coming weeks before any action is to be taken or any policy announced on the Cape Breton coal situation. So, was Mr. MacEachen announcing government policy when he made his original statement on October 5th,


1965, a few weeks before a federal election, and which he reiterated just recently when he stated at his annual Liberal meeting in Inverness that "any new policy announced by the federal government would be fully consistent" with his announcement last fall?
[DOT] (5:30 p.m.)
So, Mr. Chairman, I presume we are going to have a new mine at Lingan because the Minister of National Health and Welfare stated that new coal policy would be consistent with his announcement. I continue the quotation:
If the Donald report is going to be implemented by this government in full or in part, I feel that the people of Cape Breton and Nova Scotia must demand that there will not be the phasing out of even one job at the coal mines unless the present federal administration makes available an alternative source of employment in the immediate area. And, that Walter Gordon's now famous "one-way ticket out", now known as the manpower mobility program, not be put into effect.
I have put that on the record for one reason, to show that my feelings have not changed. We must have employment before any mine or portion of a mine is closed, as the hon. member for Cape Breton South has said. It would be rather difficult to shut down a portion of a coal mine. I am sure that all of us are looking forward to the development corporation which will go ahead and bring in industry to provide employment in substantial numbers so that 200, 300 or whatever number is necessary can be moved into other employment immediately.
The minister has said that on some occasions we have accused him of moving too slowly and on other occasions of moving too quickly. I say that on this occasion he has moved too slowly. I would be expected to say that, because it is a fact. The question of subsidy or subvention is a matter of words. However, I have always understood that a subvention is something which is paid to carriers such as the Canadian National Railways or the shipping lines. I was surprised to hear the minister say that it went to the corporation. It may be channelled through the corporation to the carriers. Certainly it is not received by the coal miners. It is paid to the transportation companies and in turn benefits the constituents of the hon. lady for Westmorland. Canadian National Railways, in the eastern Atlantic provinces area, assists many people, not only coal miners, because when a subvention is paid in respect of the transportation of coal they in turn use it to employ people who operate the railways and so on. That is why I say it assists the constituents of the dear lady from Westmorland. I mention
June 15, 19S7	COMMONS DEBATES	1569
her because she represents an area in which there is a very large number of railway employees.
The hon. member for Cape Breton South said something in his remarks about the Minister of Energy, Mines and Resources stating that the minister from Nova Scotia would refer to a heavy water plant, and so on. I am pleased that the minister is so happy about this plant but, by gosh, there is a fellow by the name of Regan, the leader of the Liberal party in Nova Scotia, who does not think it would be any good at all. We thought it was pretty good, and I am sure that the government of the province of Nova Scotia and the federal government thought it was very good. However, the leader of the Liberal party in the province of Nova Scotia does not agree. One of his cohorts, Dr. Kirby, the second rate professor whom they sent to Cape Breton, stated that it was a terrible thing, a waste of money and shocking. He did not make that speech anywhere else after that.
I should like to say a further word about the Cape Breton Development Corporation. I suggest to the minister and the government that the board should be composed of the most competent persons available. I am sure both the provincial and federal governments have been looking everywhere for the most capable and able men that can be found to take over the duties of this corporation. It is my hope, and my suggestion to the minister, that it will not be a haven for defeated Liberal candidates, party hacks, or what have you, because this is something which does happen in government, whether Liberal of Conservative. Indeed it happened under the N.D.P. in Saskatchewan or wherever it might be. In this case I would certainly hope we would get the most competent persons regardless of their politics or where they come from, because we will need the best people we can get. I notice that the Postmaster General is interjecting. I cannot hear what he is saying but possibly he would like a position on that board. I would hope not, because so far as I am concerned he is doing a very good job as Postmaster General.
To reinforce the argument I am making I should like to refer to a newspaper item which appeared in the Cape Breton Post of Friday, April 28:
The Cape Breton Development Corporation must lead Cape Breton forward in the future and not serve as an avenue to pay off political debts, Harvey Webber, president of the Sydney Board of Trade, warned Thursday.
Cape Breton Development Corporation
This is an indication of how some people in the island feel in this regard. I hope we will obtain the best men possible. We would also hope that the minister would obtain the best people possible for the co-ordinating committee.
If I may refer again to the question of what is to be paid for the Dosco holdings, may I say that I fully concur with what was said by the hon. member for Cape Breton South when he suggested expropriation. I think this is a wonderful idea. Let some independent board decide how much a lot of the junk they have is worth. I believe the minister would agree with me when I say that Dosco shares have gone up since the word went out that the federal government might take over. Well, they certainly received their pound of flesh over the years they have been there. This old boy, Sir Roy Dobson, sits in his ivory tower in Britain pulling the strings and operating the puppets. He is not too worried about the guy who gets smashed up in his coal mines as long as he brings in a few dollars. But now that they are not making any money for him he decides to throw the operation in the ashcan and not worry about It.
I do not think the government should be too worried about what they pay these people. They already owe the government over $5 million for loans granted some years ago. When these big shots came to Cape Breton they put on dinners for the Board of Trade, the Rotary Club and other groups. They were going to make Cape Breton the Pittsburgh of Canada in respect of steel. Well, it is not the Pittsburgh of Canada, far from it. They were going to do great things for coal too but we have not seen them either.
The hon. member for York South mentioned the assistance to the industry and at the same time said that this is a characteristic of the history of the country. Down through the years there has been assistance to different industries. By the same token we have subsidies in the reverse form. We have a tariff policy in this country. If we wanted we could get cheaper cars. We could go across to the state of Maine and pick up our cars there rather than keep the workers going in Oshawa or anywhere else in Canada. The same thing is true of goods such as refrigerators, washing machines, television sets, and so on. They are all protected by tariffs. I do not see why anyone should object to what is happening today; it is usual. I think the government is taking a proper step.
June 15, 1987
1570	COMMONS
Cape Breton Development Corporation
Let me also say a word about the coal miners who are now on pension. The hon. member for Cape Breton South and I have been working on this problem for many months. We introduced the matter in the house and have discussed it with the minister.
I wrote a letter to the Minister of National Health and Welfare in respect of the problem.
[DOT] (5:40 p.m.)
I received a very nice, fine, two-page reply, but it did not say whether these miners were going to be classified for the guaranteed income supplement. All it said was that if the Minister of National Revenue ruled one way such and such would be the situation but if he ruled the other way something else would be the situation. That minister has never committed himself. We have brought this situation to the attention of the minister of mines. He wrote me a short letter, a copy of which I sent to the pensioners' union. At that time the minister suggested that this matter should be taken up with the Cape Breton Development Association. I do not think we should wait that long. I think the minister with the advice of the Minister of National Health and Welfare should decide to amend the bill in order to cover this situation. These pensioners have given their lives to the coal mining industry and they have received very little in return.
I was very pleased to hear the hon. member for York South speak so highly of the people of Cape Breton, their hospitality, industry and so on. It is very nice to hear that, particularly from someone who is not from Cape Breton. Some of us who as children saw mounted soldiers breaking up strikes, who have served on the picket line, who have worked in mines and have been carried out of them, know something about this whole situation. It is not the prerogative of members of the N.D.P. only to have a feeling of sympathy for the workers and the ordinary man, as he is often called. The majority of people in the Liberal party, the Conservative party and other parties are not so-called big capitalists or millionaires. They work for a living. Many of these people who suggest they are all for the working man just wrap themselves up in the white robes of purity and sanctity and pretend to worry about the working man.


Herman Maxwell Batten: Order, please. I must advise the hon. member that his allotted time has now expired.


An hon. Member:: Carry on in the same vein.


Herman Maxwell Batten: Does the hon. member wish to continue?


Robert Muir: Yes, Mr. Chairman, and I thank hon. members for their kind indulgence in allowing me to continue. The point I am trying to make is that there are many, many people in this country with various political affiliations who worry about the so-called working man. This worry is not confined to socialists. Many of us have been involved in this type of thing, and I venture to suggest that a number of members of the N.D.P. have never been involved. The ability or desire to worry about the farmer, the miner, the steel worker, the fisherman or about any person who works with his hands is not a domain of the N.D.P. We are all interested in these people.
Progress has been slow during the years in some respects, both under the Liberals and the Conservatives. Much as I love to condemn the Liberals, they have made some progress. If a socialistic government is so great, and this has been said very often in this house, why did we not witness a great rush on the part of people from other regions of Canada to the province of Saskatchewan? They did not rush out there to get on the Douglas bandwagon or obtain the fruits of socialistic government.


Thomas Clement (Tommy) Douglas: We did not let the coal industry collapse, anyway.


Robert Muir: You let a lot of other things collapse including the morale of the people.


Thomas Clement (Tommy) Douglas: You have never been there. You don't know anything about it.


Robert Muir: I am afraid the New Democratic party is living in a dream world as it has for many years. Its members keep making crazy, weird promises that they know they will never be in a position to fulfil, and the hon. member knows that full well.
The hon. members for Cape Breton South and York South spoke very wisely and eloquently about the steel industry in relation to this resolution. On many occasions we have asked questions in the house about including the steel industry for consideration by the new development corporation. The Prime Minister in his statement, whether unintentionally or not, gave the impression that this would be the case. I am not the only one who has had this feeling. Obviously the editorial
June 15. 1967

writers of the Halifax Chronicle-Herald, understood the Prime Minister's remarks in the same way.
The Halifax Chronicle-Herald on Monday, June 12 carried the following editorial which I should like to read. It is headed "Major Development" and it states:
Undoubtedly, the major news item of this week, as far as Nova Scotia is concerned, will be the introduction by the federal government in parliament of a bill to establish the long-awaited Cape Breton Development Corporation. Thursday has been suggested as the day on which this action will be taken.
Whatever the timing, the legislation will be unveiled against a background of mounting concern about the Cape Breton steel industry, in which a number of disturbing layoffs have occurred in recent days, notwithstanding the acquisition of yet another order to produce rails for the Mexican national railways. The matter was discussed, somewhat heatedly, in the House of Commons late last week, and it was possible to infer from Prime Minister Pearson's remarks that the development corporation might have something to contribute to a solution of the steel industry's difficulties.
Certainly, Nova Scotia's voluntary planning board has suggested that the corporation should be concerned about the uncertain health of this Dosco operation. Presumably, the thought is that the agency might be able to help the promotion of a process of product diversification in an industry which confines itself largely to the production of basic steel.
Hopefully, some encouragement on this score can be drawn from the legislation when it is introduced.
So you can see that quite a number of us had the idea from the Prime Minister's statements and the statements of others that the steel industry would be improved.
Yesterday a delegation from Cape Breton communities was in Ottawa. These people came to present their case in respect of the steel industry. They received a very cordial welcome from the Prime Minister and other members of the cabinet including the Minister of National Health and Welfare, the Minister of Fisheries, the Minister of National Revenue and that great leftist of them all, Barry Goldwater-the Minister of Industry. He was not very encouraging in his comments. [DOT] (5:50 p.m.)
It has been pointed out very clearly to the Prime Minister and other members of the cabinet how very great are the problems that confront the steelworkers in Sydney. For many weeks now the hon. member for Cape Breton South, the hon. member for York South, the hon. member for Burnaby-Coquitlam and myself have been trying to obtain some information regarding the steel industry. The situation goes back six or eight
DEBATES	1571
Cape Breton Development Corporation months so the government cannot cry and say: Well, at this last minute, what can we do? We have not had time to do anything.
The government has certainly had time to investigate-I have called for an investigation on several occasions-the future intentions of Dosco with regard to steel. This investigation has not been forthcoming. There is a small investigation going on now with regard to the dumping of steel, and so on. The union cannot get any reply from Dosco officials. Community leaders cannot get any information. They get a reply but it is like some of the answers we get from the government benches, a few words but no information. The premier of Nova Scotia cannot get information. Therefore we look to the federal government to get information for us. Because of the closeness of the Minister of Industry and the president of Dosco, surely we can find out something more about the future intentions of this corporation.
As the hon. member for York South asked: Is Dosco also going to allow steel to crumble? As I asked in the house a couple of weeks ago: Are we going to end up without any steel industry at all? I know it is not an easy situation for the government, but we should have action of some sort by the government to find out what is happening in this respect. The cabinet member from Nova Scotia was present at the meeting yesterday and heard the problems and information outlined by the international representative of the union, the mayor of Sydney and representatives of other areas that are concerned. There is no lack of information; it has all been provided to the government by these people. Now we ask: What is the government going to do?
Now we are faced with another lay-off this week end, the 18th, of between 300 and 400 men at the Sydney steel plant. Is the government going to do anything to attempt to solve the problem? I know it is difficult for the government to move before the end of the week, but is there any intention by the government to do anything? Is the Prime Minister going to make a statement, is the minister from Nova Scotia going to make a statement, with regard to the future of steel? Is anyone on the government benches going to tell us about this corporation or is it to be allowed to do anything it likes?
I believe that steel should come under the auspices of the Cape Breton Development Corporation. This is my view. The Minister of Energy, Mines and Resources raises his eyebrows, but I sincerely believe this is what should happen, although it is not my usual
June 15, 1967
1572	COMMONS
Cape Breton Development Corporation policy. Here we have a situation where people are going to be hungry, and I am not exaggerating. It is an extremely serious situation. Within the last eight months almost 1,200 people in the city of Sydney and environs have been thrown on the streets. Some of these men have 25 years' service. There is nothing for them in the future, so far as anyone knows.
Someone must take action to solve this problem. I suggest that it be the Cape Breton Development Corporation. Someone must do something. I am now dealing with the social aspects of the situation. Almost all the speakers from the government side of the house, the minister and the minister from Nova Scotia who knows the situation so well, as well as Dr. Donald and Mr. Justice Rand, know the social problems connected with this question and the seriousness of what may occur if so many people are thrown on the streets. I urge the government to give very serious consideration to the points I have raised. I should like to quote from the statement made by the Prime Minister on December 29 last when dealing with the question of the Lingan mine. He said:
The federal government gave in October, 1965-*
That is when the minister from Nova Scotia made the statement that there would be a new mine at Lingan.
-an undertaking to provide financial assistance for the rehabilitation of existing mines in Cape Breton and in the opening of a new mine at Lingan.
When the Minister of Energy, Mines and Resources was dealing with this matter he made it sound as though the Cape Breton Development Corporation would now decide whether there would be a new mine. However, as I stated earlier in my remarks, the cabinet representative from Nova Scotia said there was to be a new mine. All the advertising by Liberal candidates in the election campaign of 1965 said it was a fait accompli. They said: We have a new mine at Lingan. We have told you this, and our minister has said so. Therefore we are looking forward to a new mine. The minister nods his head. I am so pleased at that indication that there will be a new mine at Lingan. I thank the minister very much for that indication, because we have been quite worried about this matter for some time. There is now no need to deal further with the question because we will have a new mine at Lingan.
Mr. Chairman, it is close to six o'clock. I have not had very much opportunity to deal


with a few smaller details. I hope later to say a little more about steel. Our dealings with the minister have been very good. He has been most co-operative. I hope he continues in that manner in the future. I am sure he will with regard to the Cape Breton Development Corporation and anything he can do for Cape Breton. I hope to have an opportunity later to say a few words. I see it is six o'clock.


Mr. Otto:: Mr. Chairman, may I call it six o'clock?


Herman Maxwell Batten: Order. It is my duty, pursuant to provisional standing order 39A, to inform the house that the questions to be raised at the time of adjournment tonight are as follows: The hon. member for Kootenay West (Mr. Herridge), National Disasters-suggested establishment of Canadian fund; the hon. member for Hamilton South (Mr. Howe), Health and Welfare-request for investigation into addition of antibiotics to livestock feed; the hon. member for Laurier (Mr. Leblanc), Northern Affairs-inquiry as to continued development at Frobisher Bay.
At six o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 8 p.m.
Steven Otto: Mr. Chairman, let me say at the outset that I support this resolution wholeheartedly. I look forward to the bill and to the results of that bill possibly with more anticipation than the minister seems to possess. What I have to say is not on the resolution or the contents of the proposed bill, but about the mood that prevails in this house. It seems to me, having listened to the debate here that there is something lacking. Optimism is lacking. I have attended wakes at which a greater air of optimism was noticeable than during the introduction of this measure.
Consider what was said. The minister pointed out that in reality what this resolution anticipated was a development corporation which, over a period of time, will cost us about $155 million. The hon. gentlemen from Cape Breton North and South pointed out the social benefits that would flow from this measure. There was some argument over whether or not a subsidy was involved. However, no one has yet said what will be the results of this legislation. What do we expect
June 15, 1967

the benefits of this corporation will be? Now, surely if that attitude prevails at a time when young people, the active people of this country are going forward with great strides and undertaking great ventures, we will not attract them.
Here, we have a development corporation. The minister, who has a keen sense of the meaning of words, should tell me what we mean by a "corporation". Do we mean a group of individuals incorporating themselves into a body for the purpose of undertaking something, something that would bring beneficial results to Canada? Here we seem to have a development corporation-of course, I do not believe it is going to turn out this way-which is going to die, judging by the attitude that prevails here.
Comments were made from the other side that we should make sure we do not use worn out politicians on this board. Well, do you expect you are going to get an active group of people together to run this corpration, if it appears to have no future? This is my argument, and I am not referring to the resolution or the bill, which seem to be good. I should like to see some measure of confidence exhibited, some anticipation of beneficial results, rather than just the impression that the corporation will spend money without any idea aboxit how we are going to make this corporation worth while.
I want to say a few words about the minister's remarks, as well as the remarks of other hon. gentlemen, about how this corporation is going to entice industry into Cape Breton. I think we should be rather pragmatic about this. Industry will not go to an area unless it foresees a future for itself. Surely, as a short term prospect, it will go to an area if it is given tax concessions. Essentially, however, industrial expansion requires that some advantage be given to industry. You must give industry something more than it gets elsewhere. You may give cheap electrical power, and you will entice industry. If you give raw materials not found elsewhere, you will entice industry. A fluid labour market, specialized skills, transportation facilities to markets- these things will entice industry.
What are you going to give industry in Cape Breton? Are you going to give cheap power? Are you going to give proximity to markets or a fluid labour supply? What will you give? The minister has not explained in what way industry will be convinced to go into Cape Breton on a long term basis. I suggest that we have the answer, but it takes some daring and it takes some confidence. Let me 27053-101
Cape Breton Development Corporation point out to the minister the present situation in connection with the heavy steel industry. The ore goes from Labrador and by boat through the great lakes to Chicago. Coal is brought in from Pittsburgh and the southern United States. Steel is made and then the finished product is brought back down the St. Lawrence to the New York market, the Montreal market and the world market.
[DOT] (8:10 p.m.)
Let us consider that ore, a very heavy commodity, is brought all that distance, six times the distance between Sept lies and Cape Breton. In spite of this, somehow they are managing to prosper. I suggest to the minister that with a little technical skill and ingenuity great things could be done. There is no reason in the world why iron ore could not be brought down this short distance to Cape Breton, which is much closer to the buyers' market in New York, Montreal, indeed the whole world, instead of sending it all the way to Chicago and back again. I understand there is some problem with the sulphur content in the coal, but neither the minister nor the department could convince me that in this technological age a solution to this problem could not be found, and quickly. It needs incentive and leadership. Most of all, it needs a dedication that a solution can be found.
We should be able to make this area the steel centre of Canada, and then I dare say that the interests in Chicago and around Pittsburgh would follow this development. This is the logical place for a steel industry. The raw material is close at hand, and all we need transport to the market is the finished product, not the heavy raw material. Anyone who has been in business will understand the advantage that the maritimes have. They have coal there, iron ore close by, they have the people and the technicians. There are fantastic possibilities. This is the sort of mood I should like to see prevailing in the approach taken in any legislation.
The minister said that the production of electricity at the pithead was not a good idea, and that may be so. It may not be a good idea to bring coal out of the mines for use in producing electrical power on Cape Breton Island, which would be sent out through the grid; but there are methods today which achieve the same objective without the coal even being brought out of the mine. The coal is burned in the mine, and the heat generated is used to produce power. I believe this is being done in England today. What we need
June 15, 1967
1574	COMMONS
Cape Breton Development Corporation is confidence; we need to know that this can be done
It is not enough to say that eventually we will have to disband the coal industry, that we are not going to make use of any advantages that we have, that what we will do is to facilitate the phasing out of the industry. This is no trick. Anyone can phase out industry; the trick is to create something. Surely this is possible in our centennial year, a time when we take such great pride in our country and listen to the laurels and tributes paid our forefathers who came to this land and with their bare hands wrested the prize, which they left to us. Our forefathers did not intend us to sit idly by; they wanted us to emulate their actions, to have confidence, to know that there is a fantastic future for us, instead of taking the position that Canada is a sixth or seventh rate nation.
I fail to understand the attitude of some of the members here, Mr. Chairman. We accept it, yet we know full well that if we were to deny wheat to the world market we could bring half of the people in the world to their knees in hunger. We supply the United States with most of their iron ore. We have the sole source of uranium and we have large supplies of fresh water. We have natural advantages, no matter which way we turn. What we have not got-and this is why I decry the attitude here-is a sense of destiny and accomplishment.
I repeat, Mr. Chairman, that I am wholeheartedly in support of this resolution, but I should like to see some confidence among us here, and also some indication of what this corporation is going to do. In this way I think the government would have shown that we are going to lead, rather than follow.


Howard Russell MacEwan: Mr. Chairman, may I say first of all that I enjoyed the interesting discourse of the hon. member for York East, which is a Toronto riding. We in the mari-times and Atlantic provinces appreciate the interest taken in us by other members.


Robert Muir: We might get him to run for Inverness-Richmond.


Howard Russell MacEwan: I do not know about that. However, I did note in the press not long ago that an alderman in the city of Toronto-I do not know whether he was resident in the hon. member's constituency-made a statement about sending some of the maritimers home because they were taking up all the housing in the Toronto area, so I would suggest to the


hon. member that he might speak to some of his fellow Torontonians and ask them to accept maritimers.


An hon. Member:: Do a little missionary work.


Howard Russell MacEwan: Yes, a little missionary work.
First of all, Mr. Chairman, as is usually said in this place on these occasions, I agree with the resolution but it does not go far enough. I also agree with the remarks of the two able members from Cape Breton, the hon. member for Cape Breton South and the hon. member for Cape Breton North and Victoria, who I might say came into the house the same time as I, and who have done an excellent job of representing their constituencies. We know that day by day they are here hammering away at matters of importance to the people of Cape Breton; and as has been shown by the number of times they have been re-elected, the people of Cape Breton appreciate their efforts.
I have something in common with them in that the area I represent depended at one time, although to a lesser extent today, almost totally on coal mining. This is why I said at the beginning of my remarks that I am not in full agreement with the resolution put forward by the minister.
On December 19 of last year, Mr. Chairman, I asked the Prime Minister a question in the house at the time the proposed setting up of this Cape Breton Development Corporation was being considered. As reported at page 11300 of the debates for December 19 last year I asked this supplementary question of the right hon. gentleman:
I have a supplementary question for the Prime Minister, Mr. Speaker, arising from the reply he made to the leader of the official opposition. If it has not already been done, will the Prime Minister, in respect of any agreement with the province of Nova Scotia-
That is with regard to the Cape Breton Development Corporation.
-take into consideration the Dosco-owned mine in the constituency of Pictou, which will also require aid?
I was referring there to the McBean mine in Thorburn, which is in my constituency. The Prime Minister answered:
All relevant matters have been considered in relation to this very important question.
That raised my hopes, Mr. Chairman. That was on December 10. On December 29 I received through the mail at the kind instance of the Prime Minister's office a copy of his
June 15, 1987

statement of that date, December 29, 1966, which has been referred to by other speakers today. On the first and second pages the following statement appeared:
Assured of the participation of the government of Nova Scotia, the government of Canada is prepared to ask parliament to establish a suitable crown corporation-the composition and powers of which will be defined by the two governments at an early date

These next words are the important part.
-to acquire, reorganize and manage the coal mining interests of the Dominion Steel and Coal Corporation and simultaneously to help promote and finance the development of modern industry on the island of Cape Breton-
[DOT]-and so on.
The part I want to underline is:
-to acquire, reorganize and manage the coal mining interests of the Dominion Steel and Coal Corporation-
[DOT] (8:20 p.m.)
In his opening statement today the minister disclosed the interesting and detailed background of the corporate set-up of the Nova Scotia Steel and Coal Company, as well as Dosco and the Dominion Coal Company Limited, but I am not going to go into that. My suggestion is that this resolution should also deal with the McBean mine which employs more than 400 people. As the minister said in his opening statement, it employs 376 miners, plus office staff, plus those on the surface running the engines, plus those in the wash plant in the town of Stellarton. This is quite a sizeable industry, employing 400 people.
I read quite a bit of the Donald report, after it came out. It is a well prepared document, but I did not agree with some parts of it. I issued a statement at that time, in response to a request by a newspaper, in which I said in part:
One recommendation of the report-
That is the Donald report:
-calls for the early closing of the McBean mine at Thorburn. Such a move would cause unemployment for over 400 coal miners and would cause great hardship to these hard working citizens, unless alternative employment is provided. The Nova Scotia Power Commission will be constructing a new thermal power plant at Trenton-
I shall refer to that later:
-which will require an additional quantity of coal to what is now used at the present plant, and the McBean mine could supply a considerable amount of it as well as the independent mine in the area. There should be definitely no closing of this mine, as I have stated, unless alternative employment is provided ...
DEBATES	1575
Cape Breton Development Corporation
And so on. The report continues to talk about independent mines and about the one at Westville.
The minister will probably say, from reading the Donald report of May, 1966, that the McBean mine has a probable life of about four years. I am led to believe, from information of the last few days, that the company does not agree with that assessment; it says that the mine has a lesser life span. Whatever the life span of the mine may be, and whatever its resources are-and I will accept Doctor Donald's estimate of four years from 1966, which would bring the end of the mine life to 1970-every assistance ought to be given to it. The employees of the mine should be taken under the protection of the crown corporation to ensure that the mine might continue working until the very end, so long as resources are there to be mined.
Not long ago I received a telegram, which the minister also received, from local 8672 of the United Mine Workers of Thorburn protesting that money for new equipment was not allotted for the McBean mine. The people out there were very put out. I was advised that certain equipment was required and was purchased by the Dominion Coal Board, for lease to Dosco. That was to ensure that the mines should continue in operation pending the setting up of the crown corporation. I was advised that certain equipment is necessary at this time for the McBean mine.
In replying to me and to the U.M.W., the minister said that the location of equipment and the use of equipment which was purchased by the Dominion Coal Board is subject to the decision of company management. I do not know whether that is so, and perhaps the minister can enlighten me further when he has an opportunity to speak. Perhaps that is the situation, but my information was that this equipment is definitely necessary to continue the McBean mine in operation to the end of its life, which I hope will be in 1970. I do not know whether the government intends to take the estimate of the Donald report; frankly, I do not know what will become of this mine. It is a little orphan, being the only one of the Dosco mines which is not covered by this agreement. I do not know whether Dosco will continue to operate it and I wish the minister would enlighten me on that point, and enlighten as well the 400 people who depend on the mine for their livelihood.
I suggest to the minister that if this mine is not covered in the resolution, or in the bill which is to be brought forward, alternatives should be considered for this area. The life of
June IS, 1967
1576	COMMONS
Cape Breton Development Corporation the mine must be lengthened as much as possible to alleviate the situation and to see that these people are kept employed, until the employees could be taken by another independent mine which could be set up or until alternative employment is found for them. Nevertheless I suggest that the McBean mine must be continued, and I hope that the minister does not adopt suggestion "I"-I think it is, of the Donald report, that the McBean mine will have only one year to go. However, since it is now 1967 I presume that under this suggestion the mine would close in 1968.
The same report states that the life of the mine would terminate in 1970, as its resources are adequate until then.
I do not think the Dosco people intend to open another mine in the area; they are getting out of the mining business. The government ought to assist in the establishment of another independent mine or an alternative means of employment for 400 people in the McBean mine, before it closes.
The minister may ask, "What is the point of that?" I noted at the beginning of the debate that he was optimistic about the corporation and about getting other industry into the Cape Breton area, but pessimistic so far as coal in this country is concerned. I wish to make a few observations about the future of coal in Canada, and in that connection to quote from the Montreal Star of March 27, 1967. This is a Canadian Press dispatch, containing this report of what was said by the chairman of the Dominion Coal Board:
Consumption of coal in Canada is rising slowly but steadily and probably will continue to meet a vital part of Canada's future energy needs, J. Watson MacNaught. chairman of the Dominion Coal Board said.
"For industry, there is no doubt that the use of more convenient fuels will increase more rapidly," he told the coal division of the Canadian Institute of Mining and Metallurgy.
"But directly or indirectly through thermal electricity, coal, I think, will always have a substantial share of the market."
Then he continues:
Despite rapid development of other fuels, coal consumption "is again slowly but apparently steadily increasing," due mainly to demands for coal-fired electric generating stations.
The thermal electric power industry in Canada expects to be using in the future more coal than this country consumed for all purposes at the peak of past consumption in 1948-and this in spite of the fact that Canada is a leader in the development of nuclear power plants."
Next I wish to read from something that will interest the hon. member for York East;
[Mr. MacEwan.l

something from the Ontario Hydro News which is put out by the Ontario Hydro people. The article speaks of the uses of coal in Ontario in the next few years, and goes on to say:
Coal remains by far the largest single item on Hydro's shopping list. Last year, expenditures in this field amounted to approximately $37,000,000- an all-time record but one likely to be eclipsed regularly as the balance of generation swings more heavily in the direction of coal-burning thermal plants. By 1980, the Commission's annual coal bill could reach nearly $77,000,000.
Ontario, a power-hungry province, tends to double its electrical energy requirements every 10 to 12 years-a demand far beyond the ability of our rivers to satisfy. And so the emphasis now is on coal-burning facilities located close to major load centres and with adequate water facilities for cooling and coal transportation purposes.
Then the article refers to the Lambton plant.
* (8:30 p.m.)
Of course, it may well be said that these remarks refer to Ontario. Subventions had to be paid on the coal going to that area. I wish to point out that the capacity of the new generating station to be placed a few miles from the McBean mine will be 150.000 kilowatts as compared with some 60,000 kilowatts generated by the present plant. Operating at full capacity, this plant, which is being set up with assistance from the Atlantic Development Board, will require approximately 400,000 tons of coal each year. The McBean mine at Thorburn would be no more than ten miles from the new station at Trenton. For this reason I believe the mine should be continued in operation as long as possible. Perhaps an independent mine could then be set up with assistance from the federal government, because the power plant will provide a market for the coal produced.
The minister will no doubt tell us, when he speaks what has been done by the Atlantic Development Board to help establish new industry. There is the Clairtone plant, and so on. I feel strongly that the industry I have mentioned is one that should be carried on, especially if, as the leader of the Liberal party in Nova Scotia says, operations with high labour content are needed.
I went over the agreement between Canada and Nova Scotia and I should like the minister to advise me as to precisely what is meant when the agreement states, on page two, in connection with subventions:
Immediately the corporation acquires the Cape Breton coal mining and related coal works and coal undertakings of Nova Scotia Steel and Coal Company Limited and Dominion Coal Company
June 15, 1967	COMMONS
Limited, Canada shall withdraw order in council PC 1936-54 dated March 23, 1966, which provides lor the payment of subventions in respect of coal produced in Nova Scotia, in so far as these subventions relate to the coal mines being acquired by the corporation and to the independent coal mines, it being understood by both Canada and Nova Scotia that the McBean Mine in the county of Pictou is not an independent mine.
I have a copy of that order in council here. It refers to the subvention mentioned by the minister of $10.50 per net ton in Ontario or Quebec and $8.50 per net ton in the Atlantic area. Will this subvention continue to be paid for coal mined at the McBean mine? What about the assistance given under the Atlantic Provinces Power Development Act which provides for subventions in respect of coal used in power plants to generate electrical energy?
I recall that Doctor Donald said in his report that the government should review the various acts under which assistance is provided for the Nova Scotia coal industry. I wonder whether clause 3 on page two of this agreement wipes out all these subventions under the Atlantic Provinces Power Development Act. Or would it be correct to say that it only wipes out this particular subvention of $10.50 in Ontario or Quebec and $8.50 in the Atlantic provinces?
The independent mines will of course be under the jurisdiction of the provincial government. I have one such mine in my own constituency, the Drummond mine. The Drummond mine is a colliery close to my heart inasmuch as it helped me get my education. I worked there during vacations. It still employs about 100 miners. I am hopeful that this mine will continue in operation. But I am wondering whether the Atlantic Provinces Power Development Act which has assisted it so greatly, as well as the McBean mine, will continue to give this support. The agreement is not clear on this point, in my opinion, and I should like the minister to clear the matter up.


Herman Maxwell Batten: Order. I must advise the hon. member that his time has expired.


Some hon. Members:: Carry on.


Herman Maxwell Batten: Does the hon. member wish to continue?


Howard Russell MacEwan: Yes, Mr. Chairman.


Herman Maxwell Batten: Does the hon. member have consent to continue?


Some hon. Members:: Agreed.
DEBATES	1577
Cape Breton Development Corporation


Howard Russell MacEwan: I thank the committee for allowing me additional time. I shall take only a couple of minutes. May I again urge the minister that an amendment be made, in this resolution or in the bill which we hope will shortly follow, which will cover the McBean mine at Thorburn. I ask this in view of the words in the Prime Minister's statement of December 29 that the crown corporation when established will "acquire, reorganize and manage the coal mining interests of the Dominion Steel and Coal Corporation". This pronouncement led me, the union and the workers in that area to believe that this mine, too, would be taken over by the crown corporation which is to be set up.
There is much anxiety among the miners, the clerical staffs and the rest of the workers in my area to know what will happen to them. Once this corporation has been set up, will Dosco close down the operation within the year or will it continue as long as the resources of this mine can be exploited?
These anxieties would be relieved if the operations of this mine could be continued for the full life of the undertaking, and I therefore ask the minister to broaden this resolution, if necessary, or the bill when it comes before us, so as to make provision for this mine with its 400 workers in my constituency.


Allan Joseph MacEachen: the coal industry, which is in economic difficulties. I think it is important to underline that the policy at the root of this measure is a joint policy, agreed to by the government of Canada and the government of Nova Scotia, and carrying the support both, morally and financially, of the government of Canada and of the government of Nova Scotia.
I regard as a real triumph the work of the Minister of Energy, Mines and Resources in undertaking these negotiations so successfully with the government of Nova Scotia. No other minister in any government of Canada has been able to engage any former government of Nova Scotia in such an ambitious joint undertaking to resolve the problems of this industry, and it seems to me the fact that both governments are involved ensures that the task will be undertaken on an objective basis and with the public interest in mind.
There is no conflict between the governments on the policy. There is no conflict between the governments on the objectives. There is a clear understanding that has been incorporated first of all in a policy pronouncement of last December and which is now crystallized in an agreement signed on the one hand by the Minister of Energy, Mines and Resources, and on the other, by the premier of Nova Scotia, so that in this resolution we are dealing with a bipartisan approach to a long standing problem.
The fact that two governments with a great deal of public support have been able to produce this kind of policy underlines an immense change in public attitude towards the existence of this historic industry in Nova Scotia. If the former member for Cape Breton South, the late "Clarie" Gillis, were in the house he woud be surprised that at the present time a public authority had been established not only to rehabilitate the coal industry, but had been established to provide alternative employment for any persons who would be displaced as a result of that modernization. I remember when the late "Clarie" Gillis was the coal authority in the House of Commons and when his interests were always directed to the problems of the coal industry.
There has been an immense change in public attitude, not only in the readiness to bring forward a public corporation but also in the readiness to accept a possible progressive decline in coal production in the coal industry in Nova Scotia. The economics of the situation are clear. Because of rising costs of production, because of the onrush of competitive fuels, it is becoming increasingly difficult for Nova Scotia coal to compete in fuel markets.
June 15, 1967

Increasing public support has been given to the industry through subventions to the extent that, in the words of the minister, this year approximately $31 million will be spent for this purpose.
The government was faced with the prospect of continuing these large subventions with no ultimate solution to the problem. The expenditures would continue and, in the absence of any plan, at some point these mines would no longer be able to operate and the result would be the collapse of the economy of the island of Cape Breton. We know that if these mines were allowed to close today, if suddenly the public support were withdrawn, it would mean the collapse of the economy of eastern Nova Scotia and it would have a very bad effect on the total economy of the province of Nova Scotia.
[DOT] (8:50 p.m.)
No modern government could permit this to happen, especially in view of the long standing commitment to the industry in the form of subventions. So the economics are that of an industry embattled by unfavourable economic forces, and the sociology is the readiness on the part of the public authorities to move in to help the industry modernize and phase out its operations on a progressive basis, and in the meantime build up alternative industries so that there will be a cushioning effect on displacement and so that the total economy and the total community will be protected.
The governments of Canada and of Nova Scotia have agreed that there must be a relationship between the phasing out of the coal industry and the development of alternate industries. It would be inconceivable to me, for example, that suddenly No. 12 mine at New Waterford would be closed out without there having been some success in establishing alternative industries. This is a mine which employs about 1,000 men. This attitude is clearly stated in the policy pronouncement by the two governments and I think will be implicit if not explicit in the bill when it is revealed to the house.
The resolution authorizes the investment of $25 million in the coal industry. The question immediately will arise, why spend $25 million in an industry which it is believed over the long term will not be a permanent industry. Well, the reason is that this capital investment is necessary to maintain the industry in a safe and economic condition over a period of 10 or 15 years, which is regarded as its normal working life. So the corporation will have this capital to use in modernizing the
DEBATES	1579
Cape Breton Development Corporation mines, or in opening a new mine if in its judgment this is the best way to spend the money. In addition the corporation will have an initial endowment from the federal authority of $20 million and an initial endowment from the provincial government of $10 million so that it will be in a position to engage in industrial promotion and industrial development. This will be a powerful weapon which can be used in an effort to encourage industry to come into this area. It is part of the policy pronounced that savings from subventions will be applied to augment the industrial development fund.
Members from all parts of the house will understand that this is not a local problem. It is a national problem because of the large numbers of individuals, their families and, as a result, other persons who are dependent upon a single industry. It is reasonable therefore to plan the adjustment of this industry. It is for that reason that the public authority has been obliged to step in, take over the operation of these mines, modernize them, rationalize them throughout their lifetime, and simultaneously develop the alternative industries which will be necessary to maintain a strong economic foundation. That is the philosophy behind the resolution.
In the House of Commons for a long time we have grappled with the problem of the coal industry. This is the first time we have been able to come forward with a realistic solution which takes into account the economics of the industry and the sociology of the people living in this part of Canada. The hon. member from Pictou county understandably is concerned about the operations at McBean. Undoubtedly he will have some further discussion with the minister who is directly responsible. All of us are concerned about and understand the problem.
We are gratified, that among all the areas of Nova Scotia, in recent years Pictou county has made marked industrial progress. It has made marked industrial progress because of the operation of Industrial Estates and because of the funds channelled into Pictou county from the Atlantic Development Board. As my hon. friend will realize, these were very large amounts indeed. There are 400 men employed at McBean. There are 6,000 or 7,000 miners involved in the economy of Cape Breton island. This government and the government of Nova Scotia were not indifferent to the interests of the McBean miners and the people of Pictou county. It was concluded, however, that the special thrust of a special corporation was not essential to the solution of the McBean
June 15, 1967
1580	COMMONS
Cape Breton Development Corporation problem, especially inasmuch as the mine is located in an area which has shown a healthy industrial development.
I have always been interested in the coal industry. There are very few miners in the constituency of Inverness-Richmond. Previously it had been a constituency with several large mines. It was an important coal producing area. These mines worked themselves out; they left ghost areas, not only in that part of Nova Scotia but elsewhere. This tragic result in the coal mining industry was caused by a lack of planning and adjustment. There is no industry that has more tragedy behind it than the coal industry, not only in Canada but in every part of the world.
I have been interested, even though there are very few miners in my constituency, because my father worked in a coal mine for 44 years. He spent all his life in the coal mines. I was closely associated with the psychology, the working conditions and the economic conditions of the coal miners of Cape Breton Island. I have taken a part in the debate on the resolution stage, Mr. Chairman, because of a long standing interest in the problem and because of an immense satisfaction that proper steps are ultimately being taken to resolve this problem.


Donald MacInnis: Mr. Chairman, would the minister permit a question. I should like to ask him whether he would take time out to explain how he can assume that the policy statement has been crystallized by the resolution, when we go back to the problem faced by the hon. member for Pictou. The policy statement says:
In addition, it is the intention of the federal government to establish with the province a joint framework which will permit the concentration of all federal and provincial efforts to promote the economic development of eastern Nova Scotia and Cape Breton Island in accordance with a comprehensive plan.
The inclusion of the McBean colliery, as the hon. member for Pictou so ably put before us, certainly was referred to in the original policy statement.
s (9:00 p.m.)
The minister might also consider the fact that when the naval base closed down, placing 600 people out of employment, the federal government at that time announced an alternative work program for each and every man laid off. Today there are still a number of people laid off at this naval base who have not been placed in alternative employment. In this connection we must remember that
[Mr. MacEachen.l

phrase used by the Prime Minister, to the effect that the development corporation would cushion the effects of displacement. It was my understanding from the earlier statements and the resolution that any minor displacements in Cape Breton would be looked after by alternative employment.


Jean-Luc Pepin: Mr. Chairman, I might try to answer some of the questions at this point very quickly so as not to filibuster my own resolution.


Herman Maxwell Batten: Order, please. I must remind the committee that the minister requires the unanimous consent of the committee to speak again.


Thomas Clement (Tommy) Douglas: Mr. Chairman, the Minister of National Health and Welfare has described the resolution and the legislation which is to follow it, regarding the setting up of the Cape Breton Development Corporation, as a star of hope for the miners of Cape Breton. I hope his prophecy proves to be accurate and that when the legislation comes down we will be able to find as much hope as the minister seems to indicate. Certainly, in the statement made this afternoon by the Minister of Energy, Mines and Resources I cannot see this star of hope shining on the horizon. As a matter of fact, the program the government is introducing at this time is like so many of its programs: It is a matter of too little and too late. It certainly is very late.
The problems which are now on the government's doorstep have been accumulating over a long period of time. The minister made reference to the late "Clarie" Gillis. He and I were deskmates in this house for quite a few years. Some 25 years ago he was pleading with the Liberal government of that day to set up the kind of corporation we are now considering, to establish a Cape Breton coal, iron and steel complex under the authority of the federal government. The minister said he was sure that the late "Clarie" Gillis would be surprised now if he were here and saw this legislation. He certainly would be surprised that it has taken the government 25 years to get around to it. That hon. gentleman recognized the tragedy of the political leadership of this country for so many decades, mainly because they are always bringing in the solutions of yesterday to meet the problems of today. Had the corporation been set up 25 years ago, or even immediately after the war while the industry was still reasonably economical, before the resources had been depleted and the profits had been sucked out
June 15, 19S7

of Nova Scotia, and before the communities had been allowed to deteriorate, we would now face a totally different situation.
We are now facing a crash program to deal with a crisis. The government is dealing with it very, very late. The hon. member for York East was quite right and with very good reason, when he said that the government was dealing with this matter as though it were attending a wake. Almost everything the minister said this afternoon, and a considerable part of what has just been said by the Minister of National Health and Welfare, had to do with phasing out the coal industry. Clause 5 of the agreement which was signed by the Minister of Energy, Mines and Resources and the premier of Nova Scotia sets out the responsibilities of the corporation, one of which shall be to establish the target phase-out timetable for the coal mines.
I am not as pessimistic as some people about the future for coal either in this country or in the world generally. I know there are particular problems in respect of the Nova Scotia coal industry. However, most coal authorities admit that with the increasing capital costs of hydro power and the very high capital costs for nuclear power, thermal plants are coming into their own.
There has been a very considerable expansion in the demand for coal in many areas. New research is being done with reference to chemical production from coal. I notice that the Nova Scotia voluntary economic planning board suggested in a summary of a report that there seems to be a fairly firm demand for some 4,500,000 to 5 million tons of Cape Breton coal until about 1972. I have not seen their working papers and do not know how dependable th;s estimate is, but as the member for York East has done, I rather deprecate the government for its assumption, that the main purpose here is not to praise the coal industry, but to bury it.
When we get to the bill itself I hope we can obtain from the minister some idea of what he means by phasing out the coal industry. If he means phasing out some of the uneconomic mines and opernng some new seams that are more economical, like the Lingan seam, that would make sense. If he means a gradual phasing out of the coal industry in Cape Breton the people should be told.
What has the government in mind? Is it aiming at 2 million tons per year as the norm, or 1 million tons by 1980? Does it estimate that coal production in Cape Breton will have been reduced 1 million tons per year by then?
DEBATES	1581
Cape Breton Development Corporation We should have some idea of what this phasing out program is, because phasing out really means phasing out the livelihood of some 6,500 coal miners, many of whom are probably too old to be retained for other kinds of employment.
I think we should know something of the training programs that are going to be introduced. On second reading of the bill we will want some assurance from the minister that there will be no phasing out of any coal operation, or a discharging of men engaged in the coal industry until such time as the industrial development program has provided job opportunities for them. There has to be a synchronization so that coal miners and others will not be thrown out of work until the Cape Breton Development Corporation is able to assure them employment in some other industry in Cape Breton.
Mention has already been made of the matter of compensation. The minister has not said anything about it, but I assume that when the legislation comes down we will be authorizing the development corporation to acquire the mines presently owned by the Dominion Coal Company. Certainly this parliament ought not to be asked to give such authority to an autonomous corporation without knowing the basis upon which compensation is to be paid, and the underlying principle, and whether or not there is to be a ceiling.
[DOT] (9:10 p.m.)
I noticed that a report in the Globe and Mail of March 8, 1967, said that a government committee had met with a committee of the preferred shareholders of Dominion Coal Company and had agreed that the pro forma book value would be a reasonable price for their acquisition. The pro forma book value, according to this report, is $19,947,677, possibly $20 million.


Jean-Luc Pepin: Mr. Chairman, I should deny immediately that such an agreement was reached.


Thomas Clement (Tommy) Douglas: Then I think it would have helped a great deal if the minister had told us this afternoon, when he introduced the resolution, what will be the basis of compensation. The minister is surely not going to come into this house with legislation-


Jean-Luc Pepin: It is in the bill.


Thomas Clement (Tommy) Douglas: The minister says, "In the bill." He introduced the resolution. The resolution ought to cover the main tenets of the
June 15, 19G7
1582	COMMONS
Cape Breton Development Corporation bill. If the minister is going to introduce a bill into the house asking us to authorize an autonomous corporation to handle certain arrangements, we ought to know on what basis the corporation will be operated and what arrangements will be made, because the cost of operating the corporation will come back into parliament in the form of supplementary estimates.
When the minister introduces the bill I hope he will tell us what payments will be made and on what basis they will be made because, as has been said repeatedly already, we ought not to be paying for liabilities. These are mainly what the government will be taking over. The resolution says we will be asked to authorize the payment of $25 million to this development corporation for the purpose of rehabilitating and modernizing the industry. I hope the minister will give us some information about this.
The minister said this afternoon that whereas the Minister of National Health and Welfare had said on October 5, 1965, that $25 million would be given to the coal industry, $10 million to open the Lingan seam and $15 million to modernize the industry, Doctor Donald in his report had taken a contrary view. So the government, with its usual decisiveness has decided to leave the matter to the development corporation to settle. I hope the minister does not think he will get a bill through the house without something more specific than that.
In October, 1965, the government thought it was worth spending $10 million of the taxpayers' money to open the Lingan seam and it was worth another $15 million to modernize the coal mines in Cape Breton. That was the policy. If that is not going to be the policy the government intends to follow, we want to know what policy it is going to follow. Also we want to know the reason for a change in policy, unless the minister thinks the Minister of National Health and Welfare was not speaking for the government and was merely making up that policy out of his head.
When the minister introduces the bill I hope he will also tell us what relationship there will be with the seven small, private coal companies which I understood him to say this afternoon are going to be taken over by the province of Nova Scotia. Will they be operated by this development corporation? It would seem to me somewhat ridiculous to have the federal government setting up a corporation to provide a coal marketing service and to have the provincial government


setting up a different coal marketing service, and to have both of them carrying out certain research on the uses of coal and market prospects for coal. Surely it makes sense if this development corporation which we are now setting up is to operate all these mines with some arrangement with the province of Nova Scotia, and also to include the McBean mine. I see no sense in leaving that mine by itself, even though it is in Pictou county.
When I said this measure was not only too late but too little I had in mind the fact that the government is in danger of proceeding to do in respect of steel what it has already done in respect of coal. Having neglected all the pleas for action by the coal industry until we are now in the position where the government is talking about phasing it out, we are facing an almost identical situation with regard to the steel industry.
The minister said a few moments ago that to include the steel industry in this development corporation would not gain widespread support. I do not know on what the minister bases that statement. If there is one thing the government ought to learn, it is that the art of governing is the art of foreseeing. It is not a matter of waiting until the government is pressed into doing something. It is a matter of the government seeing the signs that are all about it that the steel industry in Cape Breton island is in trouble. The government should not wait until the steel mill is closed, but should do something about it now.
The steel industry has for some time been having increasing difficulty. I do not think there is a doubt that it is in the process of being phased out by Dominion Steel and Coal Company. Dominion Steel and Coal Company constructed its rod and bar plant at Con-trecoeur. It constructed its flat plate mill at Contrecoeur. This means there is virtually no processing at all being carried out at the Sydney plant. Those two mills at Contrecoeur will each require about 300,000 tons of steel per year, but the capacity of the Sydney steel plant is over one million tons a year. Where is the market to come from for the other 400,000 tons, unless there is some diversification of the steel plant at Sydney to begin processing light standard fabricated steel? There is no indication that Dominion Steel and Coal Company has any such intention. As a matter of fact, it is much more likely that if they decide to fabricate light structural steel, it will be fabricated at Contrecoeur.
It is rather significant that the steel plant at Sydney has two blast furnaces and two open-hearth furnaces. It is almost the last plant to
June 15. 1967	COMMONS
continue with open-hearth furnaces. There are a good many people who suspect that when the time comes to close out these obsolete furnaces, the plant will be moved to Contrecoeur, and that we are now in the first stages of phasing out the steel industry.
The minister says there is no public support for this, but I would point out that the Cape Breton Post in an editorial of Saturday, June 10 last, suggested three things: First, a takeover by more competent management; second, a take-over by government, federal and provincial, in association with new management; and third, a transfer of control and management to the new crown corporation which comes into being shortly, operating the Sydney plant under the status of a new industry. So there seems to be some support in Cape Breton for the government including the steel industry in this new development corporation. The Federation of Labour has made similar representations. As a matter of fact, I predict that if this government does not take steps now to include the Cape Breton steel industry in the development corporation, 10 years from now some government in this chamber will be introducing legislation to deal with a steel industry that has folded up in Cape Breton. Now, instead of wasting time as we did with the coal industry, instead of allowing opportunities to slip by and then engaging in a phasing out operation, surely this is the time for the government to step into the steel industry in Cape Breton. These industries are complementary, as they have found in other countries where governments moved in to set up a complex of coal, iron and steel. They go together naturally.
[DOT] (9:20 p.m.)
As a matter of fact, the steel industry provides some of the market for coal. I understand that 50 per cent of the coal which is used in the steel plant is Cape Breton coal. If the steel industry folds up, this will be another set-back for the coal industry in Cape Breton. I hope the minister and the government, before they bring in the bill, will give very serious consideration to this matter. They are not going to be able to evade this issue by doing what the Minister of National Health and Welfare did this evening, by saying, "I cannot conceive of a development corporation being set up that will not concern itself with the steel industry." What can this corporation do about the steel industry, with $20 million?
This is a matter of total government policy. As I said this afternoon, the president of Dominion Steel and Coal Company, Mr. C. H.
DEBATES	1583
Cape Breton Development Corporation Drury, pointed out last year that in the Atlantic provinces 14,000 tons of steel were brought in from other countries.


Herman Maxwell Batten: Order. I must advise the hon. member the time allotted to him has expired.


Some hon. Members:: Carry on.


Herman Maxwell Batten: Does the committee consent to the hon. member continuing?


Some hon. Members:: Agreed.


Thomas Clement (Tommy) Douglas: I thank the members of the committee, and I will certainly not impose on their generosity. Mr. C. H. Drury, the president of Dominion Steel and Coal Company, has pointed out that last year 14,000 tons of steel from other countries came into the four Atlantic provinces. He points out this represents 30 per cent of the consumption of reenforcing steel in the four Atlantic provinces. It was for this reason he made an appeal to the government of Canada to specify in all their contracts that Canadian steel must be used. This would not solve the whole problem, but it points up the very serious situation in which the steel industry finds itself in Cape Breton.
Some 700 men have been laid off since last November. The latest notice which has been given to the union is that one blast furnace and one open-hearth furnace are to be closed. This will mean laying off another 400 men. I urge the government not to give us any more soporifics, that this situation will right itself. It is not going to right itself unless there is direct and dynamic government action. The time to take that action is when this legislation is before the house. The Cape Breton Development Corporation should be given jurisdiction over the steel industry in Cape Breton, as well as the very sick coal industry which we are handing over to their care.
May I say just one other thing, Mr. Chairman, before I sit down? I should like to refer to the second function which is being given to the development corporation, namely that of sponsoring and initiating new industries. I would certainly say that $20 million is a very small capitalization upon which to establish new industries. There are many small cities in Canada with bigger industrial development funds than $20 million. As a matter of fact, millions of dollars have already been invested in Cape Breton by the government of Nova Scotia and as a result of the activities of the Atlantic Development
June 15, 1967
1584	COMMONS
Cape Breton Development Corporation Board. To date, I think they have provided something like 400 new jobs. I am not complaining about this. I am simply pointing out the tremendous sums of money it takes to provide employment.
I believe they have been able, with three new industries, to create 400 jobs. If that is so, how much does the government think it is going to take to provide jobs for not only the 6,500 miners who may be eventually displaced, but for the 1,500 jobs which must be found every year in Cape Breton if we are going to keep the young people from having to move off the island. If the government feels that this $20 million is merely a token payment and other money will be brought along as it is needed, then that is fine. I believe the government would have given the committee a much more realistic impression of its intentions if it had put a lump sum in the resolution and in the legislation, on the understanding of course that it would be spent only as the opportunities arose. We should know from the minister what goal he has in mind and what sum of money is to be available. Surely he does not think that $20 million is going to be an adequate amount.


Jean-Luc Pepin: I stated very clearly this afternoon that the moneys saved on subsidies would be devoted to economic development. This is clear, so the sums the hon. member is referring to now are simply a first investment in this operation. We are just as aware as he is of the requirements that are needed to proceed to the kind of economic development we have in mind for Cape Breton.


Thomas Clement (Tommy) Douglas: I heard the minister say that.
I also understood, unless I misunderstood him, that the sums which the government is going to save by discontinuing the subvention will also be used to meet the losses of this corporation in operating the coal industry. The coal industry in Cape Breton is now going to operate without subventions. Is the minister telling the committee that the government will meet the losses out of the federal treasury, and that the savings on the subventions will be turned over to this development corporation for the development of new industry? Is that what the minister is telling us?


Jean-Luc Pepin: I will repeat what I said. The moneys saved on subsidies will be transferred to the economic development branch of the corporation.


Thomas Clement (Tommy) Douglas: Oh, yes, of course. However, the minister must not try to kid the troops


Herman Maxwell Batten: Shall the resolution carry?


Some hon. Members:: Carried.


Herman Maxwell Batten: Shall I report the resolution?


Howard Russell MacEwan: I asked the minister some questions, Mr. Chairman. Would he answer them now or does he prefer to wait for second reading?
June 15, 1967


Herman Maxwell Batten: I should point out that according to the rules under which the committee now operates the minister would require the unanimous consent of the house to speak again.


Some hon. Members:: Agreed.
[And the Chairman having left the table:]


Donald MacInnis: On a
point of order, Mr. Speaker. When the chairman put it to the committee whether the resolution should pass, both the hon. member for Pictou and myself came to our feet intending to pose a question to the minister. The Chair then advised that the minister would need unanimous consent to speak, and I thought he was given that consent.


Allan Joseph MacEachen: No.


Howard Russell MacEwan: Who objected?


Jean-Luc Pepin: Do it on second reading of the bill.


Mr. Depuly Speaker:: Order. The Chair has not yet reported the resolution. If there is any desire on the part of members of the house to resume in committee, there is no reason why that cannot be done. Is it the wish of the house to resume the committee?


Some hon. Members:: Agreed.


Some hon. Members:: No.


Robert Muir: The minister said he was in a big hurry. Where is the hurry now?


Donald MacInnis: I rise on a point of order, Mr. Speaker. When the Chair asked for unanimous consent, agreement was indicated on this side of the house. Unless someone cares to deny it, no one on this side of the house heard any objection to that from the other side of the house. The fact that you are now in the chair, Mr. Speaker, is an automatic way of getting this question out of the committee. We on this side have already given unanimous consent. It seems you are back in the chair just because the Liberals would not allow you to take the chair in committee. That seems to be the case.


Mr. Deputy Speaker:: Order. I asked the committee whether they would give unanimous consent to allow the minister to speak again, but under the terms of standing order 61A the minister, like other members of the house, with the exception of the Prime Minister and the Leader of the Opposition, is
DEBATES	1585
Cape Breton Development Corporation limited to 20 minutes. The minister having spoken for 20 minutes, he has exhausted his right to speak unless the committee gives him unanimous consent to speak again. Then when I asked whether the minister would like to have unanimous consent to speak again, he said that he would speak on second reading of the bill.


Donald MacInnis: With all due deference to Your Honour, that remark of the minister's was not heard. When as Chairman of the committee Your Honour put it to the committee whether the resolution should pass, both the hon. member for Pictou and myself rose to our feet in order to pose a question. The fact that Your Honour is now in the chair I think is a denial of the privilege of the members on this side of the house who are greatly concerned with this particular matter.


Mr. Deputy Speaker:: I apologize to hon. members. The resolution has not yet been reported. If it is the wish of the members of the house to resume in committee of the whole, I shall certainly do so.
[And the Chairman having returned to the table.]


Herman Maxwell Batten: Order. House again in committee of the whole.


Donald MacInnis: Mr. Chairman, the question I wanted the minister to clarify was the matter which was brought up this afternoon by the hon. member for Medicine Hat.


Herman Maxwell Batten: Order. I shall also have to point out to the hon. member for Cape Breton South that according to the rules he too has exhausted the time allotted to him.


Donald MacInnis: Am I
not allowed a question, sir?


Howard Russell MacEwan: Does the minister prefer to answer the questions on second reading?


Jean-Luc Pepin: Yes, Mr. Chairman, I have already indicated that. I have about 25 questions to answer and I do not think the time would allow me to do it properly.


Gordon Minto Churchill: Mr. Chairman, I am raising a point of order. I have often wondered about this rule 61 A, which deals with a money resolution. I quite understand that it limits the debate to one day, and subsection 2 provides that no member shall speak for more than 20 minutes. When we are in committee of the whole it is customary, and has always been the case, when dealing with resolutions
June 15/ 1967
1586	COMMONS
Cape Breton Development Corporation to make a speech of a duration, say, of five to 20 minutes, but at the same time to ask questions and to get answers. Surely this rule does not prohibit the long established custom of this house, despite the length of time a member may have spoken in a prepared speech, of asking questions and getting answers from the minister.
I do not think it was the intention of the committee on rules to change this particular procedure that has been followed in the past. As it stands now-and this is the point on which I should like your ruling-it appears that a member is prohibited from asking a series of questions, but that he must get up and make a speech which is not to exceed 20 minutes duration. That never was the purpose of the study of resolutions in committee of the whole house.


Herman Maxwell Batten: Perhaps I can refer the hon. member to a ruling made by Mr. Deputy Speaker Lamoureux on April 27, 1965 when a similar question was discussed in the committee of the whole. At that time the ruling of the Chairman was that a member of the committee could speak as many times as he wished but the total time was not to exceed 20 minutes.
My difficulty with the minister is that, if he were to be asked a number of questions, since he has already exhausted the time allowed him he would need the unanimous consent of the committee to answer those questions. The Chair of course, has no objection at all to asking for that unanimous consent.


Donald MacInnis: Mr. Chairman, a little common sense approach would go a long way toward solving this problem. Do I understand from that ruling that any member who had used up his 20 minutes would therefore be debarred from asking any questions? Since it has been established that I used my allotted time this afternoon and I was permitted to ask a question, it seems to me that a precedent has been established. I am sure that the same principle could be applied to the minister here, even though he has used up his allotted time of 20 minutes.


Allan Joseph MacEachen: Mr. Chairman, I understand the desire of hon. members to ask questions of the minister, but if we pass the resolution hon. members will then have the bill. They will have a full opportunity to study the bill and to ask more informed questions in committee, at which time there will be no limitation such as that now imposed by this


particular rule. My only point in rising is to assure hon. members that they are not losing anything by allowing the rule to be observed.


Thomas Clement (Tommy) Douglas: Mr. Chairman, may I ask the house leader a question. The hon. gentleman said that we will have an opportunity to discuss the matter when the bill comes in. Can he tell us when the government intend to proceed with second reading of the bill? That will certainly facilitate any settlement that might be made of this matter at the moment.


Allan Joseph MacEachen: Mr. Chairman, we have laid on the Registrar General's estimates for tomorrow. If we complete those we will take second reading of this bill; otherwise we will take it on Monday.


Howard Russell MacEwan: On the point of order, Mr. Chairman, may I say I did not intend to ask further questions. I thought that in my speech during the 20-minute period allotted to me I had asked sufficient questions. I wondered whether the minister wished to answer the questions now. He seems to have decided that he would answer them on second reading, and I am agreeable to that. I have asked my question, and I do not wish to ask more at this time.
[DOT] (9:40 p.m.)


Stanley Howard Knowles: Mr. Chairman, it seems to me that the purpose of the 20-minute rule in this kind of debate was associated with the fact that the debate was limited to one day. In other words, since we were limited to a debate of one day we did not want a few members to monopolize the whole day. But we have not used the whole day; 17 minutes of it are left and nobody else wishes to speak. What is wrong with the common sense of allowing the minister to have the floor to answer some of the questions which have been put to him. I understand the difficulties in interpreting the rules, but there seems to be agreement for the minister to use the rest of the time to answer the questions. Why is there the timidity?


Herman Maxwell Batten: 
Stanley Howard Knowles: The word "timidity" did not apply to Your Honour. It was expressing the hope that the minister would take advantage of these few minutes to answer some questions.


Robert Muir: On a point of order, Mr. Chairman, it appears that the minister, in common with the Minister of National Health and Welfare is tired. We have 16 minutes left. I wonder if we could agree to let this request stand. Perhaps after the minister has had a good night's sleep he may be in a better position to answer questions.


Donald MacInnis: Mr. Chairman, I do not rise on a point of order or on a question of privilege, but merely to say that the minister allowed the hon. member for Medicine Hat, who spoke this afternoon, to misinterpret him. The subvention money will not be withheld once the corporation is set up. The corporation will of necessity have to use that money for transportation, and to keep the mines operating until they can be phased out. There will be no additional money, as I said this afternoon, and the minister agreed with me. This evening he tried to leave another impression. It is a matter of taking the money, so to speak, from the subvention pocket and putting it into the corporation's pocket. As I said, the corporation would have to spend money for the transportation of coal to markets if the mines are to be maintained until they are phased out. At least the minister ought to make that point clear.


Mr. MacLean (Queens):: I want to say a few words, not because we have any coal mines in my province, but because this matter is important to the economy generally of the maritime provinces. We have no coal mines in Prince Edward Island, though by devious means we have produced at least one chairman of the coal board.
I want to impress on the minister the importance of finding a solution, without reservation or hesitation, to this serious problem, and I want to ask him and the government to bring the most generous and exacting consideration to it.
The economy of any area such as Cape Breton island and eastern Nova Scotia is not an entity in itself that can be separated from the general economy of the area. When the economy of Nova Scotia is prosperous, there is an ever widening circle of economic benefit that accrues generally to the maritime provinces. When the reverse obtains we in Prince
Cape Breton Development Corporation Edward Island feel the pinch. Traditionally, when eastern Nova Scotia is prosperous we have found there an important market, chiefly for our farm and food products. When a depression or lack of employment becomes apparent in the industries of Nova Scotia, the effects, rather strikingly, are immediately and recognizably felt in the economy of Prince Edward Island.
There was a time half a century ago when the industrial prospects of eastern Nova Scotia seemed bright. That was a period of buoyancy and optimism and it had beneficial effects on the economy of the entire area. For the last 25 years we maritimers generally have been plagued by a series of industrial difficulties, first in one industry, then in another; and often these were not unrelated to each other. The failure of an industry, or the lack of vitality in an industry owing to its low profits or because it could not be viable without subventions or an artificial stimulus, had a depressing effect and lowered confidence in the whole area.
This matter is not of exclusive and direct concern to the industries in the area we talk of. What happens has a subsidiary effect on the whole economy of the maritimes. I am sorry to take time with the statement, but I want it to be understood that this is a matter in which all maritimers have a deep interest. I believe all Canadians should be deeply interested in this, and they probably are.
In the maritimes and the Atlantic provinces generally we are cursed-that is not too strong a word to use-because, to balance our economy, we have to buy for the most part manufactured goods which are manufactured chiefly in central Canada, behind protective tariff walls, and we must find markets for our own products, not generally in Canada but in foreign places. This is especially true of Newfoundland, and it is true to almost as great an extent of Nova Scotia and the other maritime provinces.
In that part of Canada we have no bargaining position vis-a-vis the rest of Canada. We cannot argue about tariffs and other arrangements which might be beneficial to large segments of our economy. We are the victims quite often of measures that are considered beneficial to Canada as a whole, or beneficial to the large economic interests. By "large economic interests" I refer to the large segment of the Canadian economy, e (9:50 p.m.)
This leaves us in the Atlantic provinces in the position where we have not enough
June 15, 1967
1588	COMMONS
Cape Breton Development Corporation weight from a political point of view to give our views an overriding effect-I use the phrase "political point of view" in a general way to mean that we are not large enough in the over-all picture to do so, and that is only to be expected. So we have to make the best of circumstances in which artificial effects on the economy are brought about by tariffs and other devices. Then we are left, or have been, historically, to forage for ourselves-to do the best we can to find markets for our products, products of the mines, the forests and the sea which for the most part must be exported to world markets at a world price which is generally based on lower wage standards and lower local prices than those which exist in Canada and the United States. Only in some cases are markets for our products to be found in the United States. Most of them go to low price areas, low labour cost areas such as the West Indies, Spain, Portugal and Italy.
If the bill which is to follow this resolution will do anything to solve the serious economic problems of Cape Breton and Nova Scotia generally, we in the maritimes support it wholeheartedly. We are not at all certain that this will be the effect. All I want to say is that this is not a matter which is of interest only to members of parliament from eastern Nova Scotia.


Mr. Peters:: Now that I have thought about it, I am sorry I do not have more time in which to make a speech. The question which the minister has to answer is: Where does the subvention go? There is a relationship between the Dominion Coal Board, with its subventions, and the effect of the Emergency Gold Mining Assistance Act on the operations of mines in northwestern Ontario. These subventions concern the economy of the gold mining area, as they do the economy of the maritimes.
The fact that the hon. member for In-verness-Richmond has left the chamber is no reason for the minister not answering the question which was put to him. It will undoubtedly be brought up again on the second reading of this bill. The Prime Minister has said that this $25 million, the coal subvention, will be given to the corporation. But does the minister not realize that if the corporation mines and sells coal it will have to pay exactly the same subvention as the coal board did, or it will find itself with no markets? This means that the $25 million is transferred from one pocket to the other; the situation will be unchanged.


The fact that the industry will be operated by a government agency and that the Canadian public is now becoming more interested in allowing efficient crown corporations to run economic operations in this country, will not really make much impression on Toronto when that city buys coal for its steam generating plants; it will still want to pay the same price, and to maintain the same price the government would have to pay a transportation subvention of approximately $25 million. There will be no change. No inducement has been offered to consumers to warrant their paying more to a crown agency than to the Dominion Coal Board.
The minister can be assured he will be faced again with this question on second reading. I am of the opinion he will find it more rewarding politically to answer it than to avoid it. Indeed I am surprised that the minister, who is usually informative, should decline to clarify a point of this kind. There must be a very obvious answer, because it is a very obvious question. It might be in our best interest to have the question answered tonight.


Jean-Luc Pepin: The answer is obvious, too.


William Arnold Peters: If the answer is obvious, I should like to hear it, even in the last minute before this debate concludes. I would be prepared to give the minister just two minutes in which to answer the question.
Resolution reported and concurred in.
Mr. Pepin thereupon moved for leave to introduce Bill No. C-135, to establish the Cape Breton Development Corporation.
Motion agreed to and bill read the first time.



BUSINESS OF THE HOUSE

John Angus MacLean: May I ask the
leader of the house whether he is in a position to inform us of the business for the next few days-for a week, if possible.
* (10:00 p.m.)


Allan Joseph MacEachen: As I stated earlier, the business for tomorrow is the estimates of the Registrar General. If we complete those tomorrow we would start the second reading of the development corporation bill and continue it on Monday, or otherwise begin it on Monday. On Tuesday we will take the estimates of the Minister of Energy, Mines and Resources; on Wednesday the estimates of the Minister of National Health and Welfare; on Thursday those of the Minister of National
June 15, 1967

Defence, and on Friday those of the Minister of Labour.


Gordon Minto Churchill: May I ask the house leader one question. Is he counting Wednesday as a full day for the consideration of estimates, because the practice last year was that Wednesday counted as only a half day?


Allan Joseph MacEachen: I would have to check the practice, Mr. Speaker, but I had understood that Wednesday was a day.


Gordon Minto Churchill: May I point out to the minister that on Wednesday of this week we spent only one hour and 45 minutes on estimates, and that surely is not a day. A day normally is five or five and half hours.


Donald MacInnis: wonder if the house leader would now make available copies of the development corporation bill to hon. members?


Allan Joseph MacEachen: Yes, Mr. Speaker, the bill will be made available in English and French. We do not have it in Gaelic.


Donald MacInnis: Made available when-tonight?



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: Mr. Speaker, in opening my remarks I think it is a bit unfortunate we have not got the television cameras here to televise the drama of parliament, as I have heard it called. Anyway, I must say that for years I have been convinced of the need for a national disaster fund. I remember when this idea came to my mind in embryo in 1929. I was in charge of building 20 miles of highway through a mountain pass in British Columbia. As the result of a spark coming from a locomotive climbing a steep grade I witnessed in four hours the destruction of sawmills, of homes, of farm property and of 200 million feet of timber. As a witness to the whole spectacle, I shall never forget thinking to myself that there should be some reasonable way, through law, to meet a disaster of this magnitude.
Proceedings on Adjournment Motion
In recent days, Mr. Speaker, the Fernie disaster and other disasters that have threatened as a result of forest fires and are presently threatening as the result of the flooding of some of our rivers, indicate the need is increasing for some form of national disaster fund. It was only yesterday the Minister of Industry (Mr. Drury) informed us that the Emergency Measures Act is established as a result of co-operation between the federal, provincial and municipal governments and that it can be applied on the municipal level where the resources are sufficient. Where they are not sufficient at that level they can apply to the provincial government, and where they are beyond the scope of the provincial government they can apply to the federal government. There is a logical basis for the operation of that fund, as a result of co-operation between all levels of government to meet any particular situation, whether it is in peacetime or under a wartime emergency.
It is because of my interest in this question, Mr. Speaker, that for many years I have introduced a bill entitled, "An Act to provide for the establishment of the Canada Disaster Fund." As a result of studying this bill, I find I would now call it a national disaster fund, so as not to compete with a private organization that is in the field.
I introduced this bill for the following reasons. It is intended to meet the problem of deciding at what point disaster losses are beyond the capacity of a province to deal with effectively, and the disaster essentially becomes national. The bill would set up a fund to which contributions can be made in advance by federal and provincial governments and by individuals, companies and institutions. The board of trustees would determine each year in advance, in respect of each province, the provincial financial tolerance point above which losses are of national scope. Should a disaster occur in a province the board would contribute to the province out of the fund in respect of the losses above the tolerance point.
I am not suggesting, Mr. Speaker, that this bill is perfect in all respects. It was introduced to give members an opportunity to study the question and to give the government an opportunity also to consider the importance of this matter. It was because of my interest in the subject initially, and the interest which has been stimulated as a result of my experience in this house over a period of 22 years, that I introduced the bill. It was for
June 15, 1967

Proceedings on Adjournment Motion that reason that I asked the Prime Minister the following question:
In view of the recent Fernie disaster, the possibility of disaster to the residents of Sioux Lookout and Chapleau, and other disasters, has the government given consideration to the need for a Canadian disaster fund after the fashion of the bill introduced by the member for Kootenay West, that will provide for a Canada disaster fund to which contributions can be made in advance by federal and provincial governments and by individuals, companies and institutions for assistance where the losses are considered of national scope.
I am very pleased to see the minister here this evening. I shall be interested to hear of the government's intentions with regard to the establishment of the disaster fund I have mentioned.


Hon. Jean Chretien (Member of the Administration):: Mr. Speaker, I should like to point out to the hon. member that there is a law on the Canadian statute books entitled the Canadian Disaster Relief Fund Act. This act, passed in 1953, provides for almost the same thing for which the hon. member is asking. It sets up a corporation known as the Canadian Disaster Relief Fund, Incorporated, consisting of five members, each of whom represents one of the geographical divisions of the country. The first members of the corporation were named by the act, which provides that when a vacancy occurs in the membership of the corporation the Secretary of State may appoint a new member.
The corporation was established to manage and distribute the Canadian Disaster Relief Fund which consists of all money, property and securities received by the corporation for the purposes of the act and all income derived therefrom. No payment shall be made out of the fund except as authorized by the act. Section 6(3) of the act provides this:
The corporation may make payments out oi the fund for the purpose of meeting emergencies and needs arising in Canada from flood, fire, tempest, earthquake, pestilence or other disaster, mitigating loss and suffering caused thereby assisting in repairing damage resulting therefrom, and rehabilitating persons who have suffered injury or loss by reason thereof, when in the opinion of the corporation the implementing of such purpose is beyond the reasonable capacity of the area affected.
I think, Mr. Speaker, there are associations such as the Red Cross Society which do their best to help in these situations. In every case the government looks into the situation and does its best to improve the situation in respect of those who have suffered discomfort.


Herbert Wilfred Herridge: These are private associations and are not under the control of the government.



HEALTH AND WELFARE-REQUEST FOR INVESTIGATION INTO ADDITION OF ANTIBIOTICS TO LIVESTOCK FEED

Mr. William Dean Howe (Hamilton South):: Mr. Speaker, yesterday I asked a question actually of the Minister of Agriculture in the absence of the Minister of National Health and Welfare, simply because I could not decide who is responsible for the feeding of cattle in this country. In an article which appeared in the Globe and Mail of June 13 I learned that there is widespread use of large quantities of antibiotics as animal feed supplements. The danger in this regard of course is that there are remainders of small amounts of antibiotics in the meat which humans ingest every day.
In the practice of medicine we must be very careful, when we use antibiotics, that we use them in effective doses for a certain period of time until we kill the infection, rather than in small ineffective quantities, so that the bacteria do not gain the opportunity to build up resistance to the effect of the antibiotics.
e (10:10 p.m.)
I was unaware through my own ignorance, that antibiotics were used in cattle feed and that all of us were ingesting small amounts of antibiotics at all times when we ate meat. Because of the care we have to take in the practice of medicine it was a source of worry to me that possibly we are losing the effectiveness of antibiotics in that practice, because of this gradual but insidious absorption of antibiotics. I do not understand or pretend to understand the purpose of using antibiotics in cattle feeding.
There was a three day symposium held in Washington, the date of which is not given in the article, and I could not find out precisely when it was held, but according to the article Canada was one of the nations represented. It was my intention in asking the question to derive what the government's role was, what was said and what investigation is being carried out to prevent a link between the drug resistant bacteria found in man and the widespread practice of using antibiotics as a food supplement for animals whose meat we ingest.


Mrs. Margaret Rideout (Parliamentary Secretary to Minister of National Health and Welfare):: Mr. Speaker, there was a public symposium held in Washington on June 5 to June 7 on the use of drugs in animal feeds. Representatives of the food and drug directorate of the Department of National Health
June 15, 1967

and Welfare and representatives of the Department of Agriculture were in attendance.
It was evident from the proceedings of the symposium, which was attended by officers of our departments, that antibiotics added to animal feeds can result in the emergence of antibiotic resistant strains of micro-organisms. The possible impact on human health of such micro-organisms in animals is not at all clear. The Department of National Health and Welfare is continuing to keep this problem under close surveillance.



NORTHERN AFFAIRS-FROBISHER BAY-INQUIRY AS TO HOUSING PROGRAM

Mr.   Fernand-E. Leblanc@Laurier: Mr. Speaker, yesterday I asked the following question to the Minister of Indian Affairs and Northern Development:
Does the department intend to carry on the intensive development program at Frobisher Bay by building this year new houses for Eskimos and government personnel?
If the Chair had not felt that the question was out of order, I would have asked the following supplementary question: Can the minister tell the house about the 1967-68 program concerning the number of units which will be built as well as their total value?
During my trips to that locality, I had the opportunity to realize the economic importance of Frobisher Bay and to consider also the sanitary needs and others for which it is urgent to make provision.
Frobisher Bay has a population of approximately 1,600 inhabitants, 1,000 of whom are Eskimos. It is the largest centre in the eastern Arctic both by its size and its large Eskimo population. It has the only international airport in the far north, and one is pleased to find that Nordair company serves this area effectively on a regular basis. It is the headquarters of a great number of government officials and other private enterprise employees who often live under deplorable conditions. Frobisher Bay is a regional centre whose administrative role is comparable to and even more important than that of centres like Churchill, Inuvik and Yellowknife. Capital investments there exceed $25 million.
Apart from the federal building which was constructed on a permanent basis, the other buildings, houses, schools, are temporary and as you all know, temporary services and quarters which are not up to Canadian standards reduce the efficiency of the workers and
Proceedings on Adjournment Motion weaken their morale. It is absolutely necessary to replace all these temporary buildings with permanent and modern constructions.
The government's construction program has been set for a five year period. In 1967, it was projected to build 30 houses for government employees and 20 for the Eskimos. This program was carried out and I want to congratulate the government for that. This does not mean, however, that all the needs have been met. Nevertheless, this was a promising start which now seems endangered for 1967-68.
This was the program for the 1967-68 period: Construction of 70 houses for government employees; construction of 100 houses for the Eskimos; construction of adjacent roads; planning for the construction of office and store buildings; preparation of plans for living quarters of 100 bachelors; preparation of plans for building a technical school.
I hardly think it is necessary to list the projects for the years to come, but I do hope that they will not be abandoned, so that the economic development of this area may be pursued satisfactorily.
However, I note that vote No. 25 of the Department of Indian Affairs and Northern Development in the estimates for 1967-68 provides no money for part of the 1967-68 program, particularly for the following items, according to the replies given by the minister to the member for the Northwest Territories (Mr. Orange) at the beginning of June: No money to continue the program to build 70 houses for government employees; no money to prepare plans for the construction of office and store buildings; no money for the preparation of plans to build living quarters for 100 bachelors.
Due to the fact that Frobisher Bay has no basic resources and is entirely dependent on the government for its existence, this attitude by the department is causing a feeling of frustration and instability among the population and, consequently, is reducing its productivity and legitimate aspirations.
I hope that the government will not only continue the program submitted to and accepted by Treasury Board but that it will step it up and improve it.
[DOT] (10:20 p.m.)


Joseph Jacques Jean Chrétien: Mr. Speaker, may I say to the hon. member for Laurier (Mr. Leblanc) that it is most refreshing, on a day such as this when the heat is intense, to hear about the Canadian northland.
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Proceedings on Adjournment Motion The hon. Minister of Indian Affairs and Northern Development is away at the present time. Indeed, he is up north attending to his business with the diligence and determination for which he is known. As he is not here to answer that question, I shall be glad to convey to him the representations of the hon. member for Laurier.
It is also most interesting to see a member from an urban centre like Montreal show
DEBATES	June IS, 1967
concern for the people living up north. The Canadians of the province of Quebec thus show that they take an interest in all Canadian problems, including those having to do with northern development, and I wish to congratulate the hon. member for that initiative.

Motion agreed to and the house adjourned at 10.20 p.m.

Friday, June 16, 1967